Posted tagged ‘Federal Reserve Policies’

Must Reads For The Week 12/15/18

December 17, 2018

Egypt Restricts The Sale Of Yellow Vests Suspecting That Egyptians Might Copy The French, at egyptianstreets.com.  This could be a satirical headline. But it’s true. These geniuses can’t possibly believe that the vests are causing the protests, can they? Just remember these are the same people who think guns cause murder.

Shocking Data Show 40% Of American College Students Never Graduate, at zerohedge.com. 80% of those who don’t finish college have student loan debt. Why do we push college on individuals who have no business going in the first place. College is a racket. All it does is create debt serfs.

Elon Musk’s Taxpayer-Funded Gravy Train, by Allan C. Brownfeld, at mises.org. Elon Musk is a multi million dollar welfare recipient. His businesses wouldn’t survive unless they were subsidized by taxpayer dollars.

House Passes $867 Billion Farm Bill Which Rejects Curbs On Food Stamps, at zerohedge.com. I’m surprised Elon Musk hasn’t figured out a way to get his hands on some of this money. The Government is confiscating the production of some people and redistributing it to others people who haven’t earned it. What is sad is that the supposed party of small government (Republicans) voted for this big government bill.

McKenzie Adams, Alabama 9-Year-Old Who Hung Herself, Faced Racist Bullying, Her Family Says, by Issac Stanley-Becker, at washingtonpost.com. This story is an example of the main stream media shaping the news by what they don’t report. I read the first page of articles of this stories google search. Not one article mentioned that the bullies were black kids. If you read the headlines you would think white kids bullied her. Ask yourself this, if it was white kids doing the bullying, would it have been front page news.

How Government Bureaucrats And The New York Times Are Misleading The Public About Climate Change, by Robert P. Murphy, at mises.org. The government and the media are teaming up to feed us propaganda about global warming.

We Need Unilateral Free Trade With Post-Brexit Britain, by Ryan McMaken, at mises.org. The EU and pro EU bureaucrats in Great Britain are trying to over turn the vote of the British people who decided to get out of the EU. Bureaucrats say they can’t come up with a Brexit deal they can agree on. Why do you need a new “deal” to get out of the old deal. How about you just state that the EU rules no longer apply. That’s one sentence. These bureaucrats are fighting the Brexit straw man they created in order to run out the clock and force another Brexit vote in the hope it turns out different this time.

“Peak TV”: Streaming Originals Overtake Basic Cable, at zerohedge.com. This is an example of the creative destruction of the market. Streaming came into the market and has provided a lower price product that individuals like.

What Is Economic Growth? (And What Is It Not?), by Per Bylund, at mises.org. Increasing productivity is economic growth. In other words producing more output with less imput. Here is an except from the article: “….increased productivity really increases the purchasing power of all money, including (and most importantly) low wages, thus making it much more ‘affordable’ to satisfy one’s needs and wants. But note that the distribution of such prosperity cannot be equal or instantaneous: any new innovation, new good, new service, etc will be created somewhere, by someone– it cannot be created for seven billion plus people instantaneously. So anything new, including new jobs and new productive abilities, has to spread–as ripples–across the economy.

The Myth Of The Neutral Interest Rate, by Frank Shostak, at mises.org. It is impossible for Federal Reserve policy makers to know what the neutral interest rate should be at any particular time. Excerpt from the article: “Now, even if the Fed were to know the level of the neutral rate it could not achieve economic stability. The reason being that the Fed would have to pursue active monetary policies to maintain the neutral rate target”

“This act however, will lead to boom-bust cycles and economic instability. Hence, there cannot be such thing as the neutral interest rate policy, which will result in economic and price stability.”

“Rather than targeting the money market interest rate towards the unknown neutral rate by means of monetary tampering, which leads to more instability, a better alternative is to leave the economy alone, In a free market economy without a central bane, no one would be conducting any kind of monetary policies.”

“In the absence of central bank monetary policies, which enrich some individuals at the expense of other individuals, interest rates that emerge will be truly neutral.”

“In a free market, no one then would be required to establish whether the interest rate is above or below some kind of imaginary equilibrium.”

 

THE BREAK DOWN OF THE RULE OF LAW

DEEP STATE INSIDERS ABUSES OF POWER

Google CEO Exposes Shocking “Full Extent” Of Russian Meddling In 2016, at zerohedge.com. There is very little Russian meddling compared to how much is portrayed by the main stream media.

Despite Comey’s Struggle With Amnesia, Ex-FBI Director Confirms Dossier Totally Unverified, at zerohedge.com. “I Don’t Recall.” This is the phrase that will get you out of a perjury trap. I learned this from the Clintons back in the day. Comey and all insiders know the importance of this phrase. They use it all the time when being questioned. But let me give you better advice. Don’t talk to law enforcement. Assert your fifth amendment rights.

Judge Overseeing Michael Flynn’s Sentencing Just Dropped A Bombshell, by Margot Cleveland, at thefederalist.com. They set a perjury trap for Flynn. He pleaded guilty to a crime he didn’t commit because he didn’t have the resources to fight an all-powerful government.

Former FBI SSA Exposes McCabe & Mueller’s “Unethical, Target & Destroy Coercion” Tactics, Defends Flynn, at zerohedge.com. If you are ever questioned by law enforcement always remember this little fact before you decide to talk or not talk. They can lie to you, but if you lie to them you can be charged with perjury.

DOJ Destroyed Missing Strzok/Page Texts Before IG Reviewed Them, by Bre Payton, at thefederalist.org.  –  Also –  Mueller Destroyed Messages From Peter Strzok’s iPhone, OIG Recovers 19.000 New “FBI Lovebird” Tests, at zerohedge.com. Hillary did this and got away with it. She destroyed Emails after they were subpoenaed. You or I could never get away with this. Only Insiders can get away with this.

 

SATIRICAL HEADLINES

Clintons Outnumber Crowd At Latest Speaking Engagement, at babylonbee.com.

Ninth Circuit Court Rules Border Wall Must Be ‘Short’ Enough That A Pregnant Woman Carrying A Child In Each Arm Could Be Expected To Scale It Without Difficulty’, at babylonbee.com.

Steph Curry Questions Whetherr Michael Jordan Actually Went To Space To Help Bugs Bunny Win A Basketball Game, at babylonbee.com.

Hollywood Working ON Official List Of Comedians It’s OK To Laugh At, at babylonbee.com.

Heisman Winner Proves If You Work Hard And Believe In Yourself, You Can Gave Journalists Try To Ruin Your Life By Combing Through Your Old Tweets, at babylonbee.com.

CNN Opens Up 24-Hour Anonymous Tip Line For Anyone With Synonyms For ‘Meller Closing In’, at theonion.com.

 

CARTOONS

from theburningplatform.com

Political Cartoons by Steve Kelley

Political Cartoons by Henry Payne

Political Cartoons by AL Goodwyn

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Federal Reserve Policies Cause Booms And Busts, by Richard M. Ebeling

September 26, 2014

In God (or money) we trust - making money on the hand printing press - stock photo

Federal Reserve Policies Cause Booms And Busts (read here at mises.org), is a fantastic article by Richard M. Ebeling, explaining what happens when central banks, like the Fed, intervene in the economy. Electronically printing counterfeit money and artificially lowering interest rates are the tools the Fed uses to “improve” the economy. The Fed may pay lip service to the free market, but the policy makers at the Fed truly don’t like the outcome resulting from the voluntary decisions individuals make in the free market. If they did, they wouldn’t intervene after the fact to try to exchange what they want the economy to look like, for what actually exists as a result of what each individual decides to produce, consume, save, and exchange.

Their tools of intervention, electronically printing counterfeit money and artificially lowering interest rates, send false information through the market. People in the market start to make decisions on what to produce, consume, save, and exchange based on this false information. The structure of the production process has no anchor to reality and the result is distortions and malinvestment. Scarce resources are allocated to areas of the economy that can’t be sustained unless ever-increasing amounts of electronically printed counterfeit money is pushed into the economy. The economic forces of supply and demand are always trying to reach equilibrium (balance). These economic forces, that are trying to correct the interventions of the central planners, will eventually win.

HERE ARE SOME EXCERPTS FROM THE ARTICLE

“In the free market, interest rates perform the same functions as all other prices: to provide information to market participants; to serve as an incentive mechanism for buyers and sellers; and to bring market supply and demand into balance. Market prices convey information about what goods consumers want and what it would cost for producers to bring those goods to the market.”

“Market rates of interest balance the actions and decisions of borrowers (investors) and lenders (savers) just as the prices of shoes, hats, or bananas balance the activities of the suppliers and demanders of those goods...”

“…There is one crucial difference, however, between the price of any other good that is pushed below that balancing point and interest rates being set below that point. If the price of hats, for example, is below the balancing point, the result is a shortage;”

“…In contrast, in the market for borrowing and lending the Federal Reserve pushes interest rates below the point at which the market would have set them by increasing the supply of money on the loan market. Even though savers are not willing to supply more of their income for investors to borrow, the central bank provides the required funds by creating them out of thin air and making them available to banks for loans to investors. Investment spending now exceeds the amount of savings available to support the projects undertaken”

“…The twin result of the Federal Reserve’s increase in the money supply……is an emerging price inflation and an initial investment boom…”

“…The boom is unsustainable because the imbalance between savings and investment will eventually necessitate a market correction when it is discovered that the resources available are not enough to produce all the consumer goods people want to buy, as well as all the investment projects borrowers have begun.”

“Interest rates, like market prices in general, cannot tell the truth about real supply and demand conditions when governments and their central banks prevent them from doing their job. All that government produces from its interventions, regulations, and manipulations is false signals and bad information. And all of us suffer from this abridgement of our right to freedom of speech to talk honestly to each other through the competitive communication of market prices and interest rates, without governments and central banks getting in the way.

Related ArticleThe Role Of Interest Rates In A Market Economy, by austrianaddict.com.

Related ArticleThomas Woods Explains The Austrian Business Cycle Theory, by austrianaddict.com.

Related ArticleCounterfeiting By The Federal Reserve, Although Legal, Still Results In Theft, by austrianaddict.com.