The Federal Reserve: “A God That Has Failed”

Why does Wall Street keep recovering after recessions but the economy seemingly never does? The reason, as I document in my book, “The Scandal of Money: Why Wall Street Recovers but the Economy Never Does” is that Washington and the Federal Reserve together have created a closed loop economy where the Fed creates money for the government and the S&P 500 and Main Street is left out. The Fed decides what money is worth and who receives it and how much. The Fed prices it at zero interest rates, allegedly to stimulate economic growth. But whenever something is free, it’s

The Government Can’t Print Its Way to Economic Growth

Trump baffles conservative elites: how with such a talented field of candidates we could we end up with an isolationist, big-government, trade-war nominee? But give the American people this much credit: they understand the economic game has been rigged: that while the crony capitalists are still getting richer, ordinary Americans and their children face a bleak economic future. Give Trump credit for flagging the problem in an interview with The Hill last October accusing Federal Reserve Chairwoman Janet Yellen, of keeping interest rates low in order to shield Obama from having to leave office during a recession. “She’s keeping the

“The Scandal of Money” Interview

My book, The Scandal of Money: Why Wall Street Recovers But the Economy Never Does, launches today: The Fed creates money for the government and for the Fortune 500 corporations and nobody else gets it. . . this has starved Main Street — turned Main Street into Mean Street; it’s kind of gelded Silicon Valley made them into petitioners in Washington and it has turned Wall Street into a kind of servant of Washington; Wall Street has been effectively nationalized by the Obama administration. So we have covert socialist coup in America accomplished through the Federal Reserve and this has

The Real Myth Lies With Gold Standard Critics

The real deep myth at the heart of criticism of the gold standard is that it’s value stems from its use as a commodity. The fact is that gold is valuable because its scarcity is founded in the scarcity of time (the time to extract it, which has hardly changed in centuries). Commodity prices change; time is changeless and irreversible. That is the source of gold’s immemorial power as the monetary element, and it will be the source of the value of the digital forms of gold that are emerging around the globe. The present system — the global ocean of currency trading — has no secure

Cruz Is Right About Gold

Ted Cruz grasped the nettle in the debate and explicitly upheld gold as the “ideal” monetary foundation. Perhaps he understands the scandal of money: that gold currency is now effectively illegal in the U.S.; that the murky $5.3 trillion a day churning of currencies now muddles rather than defines all value in the global economy. The next step from the nettle is an actual program for the net, which should include digital currencies such as bitcoin as well as the cancellation of capital gains taxes on the alternatives to the dollar. As Hayek wrote: “The source of all monetary evil is the government monopoly on money.”

Fiorina Triumphs While Bush Makes the Case for Growth

Hey, don’t tell anyone, but Carly Fiorina is my new heart throb, breaking through the maginot lines of poll-driven mediocrity, where candidates carefully tell the audience what they already think, and establishing a new standard of leadership for the Republican tribe. From a lackluster Senate candidate in California, she has transformed herself into a consummate communicator. Last night, Carly Fiorina looked as if she were born to wield both the scales of judgment and the sword of justice for our party. But she never really engaged the economic issues. I was struck how little a role economics played in the debate,

Greece and Gold

Megan McArdle, a smart journalist, is dead wrong in arguing that the moral of the Greek story is bad for gold.  The reason for Greece’s troubles is the failure of the global fiat money regime that McArdle supports as the remedy. With nearly meaningless money, all economies will eventually slump and stagnate and marginal ones will collapse. All enterprise depends on the guidance of reliable money. Money must serve as a measuring stick for enterprise, not as a magic wand for governments. Central banks waving magic wands stultify commerce by reducing most of it to currency speculation and arbitrage. With $5.4 trillion

Ramesh is Wrong

My short book presents a new information theory of money. Only in passing did I cite Ramesh Ponnuru and National Review as influential representatives of a monetarist faith curiously shared with Paul Krugman and most Democrats. With colleague David Beckwith, Ponnuru is a savvy and sophisticated monetarist who, like virtually all of his faith, wants us to attend to all the refinements of the recherche views that distinguish him from his unwonted allies. My book, however, regards centralized monetary policy itself, regardless of refinements, as a socialist temptation. Controlled by central banks with floating currencies, and oriented toward the needs of