Central Planning Vs. Economics

By Keith Weiner – Re-Blogged From Gold Eagle

We have spilled barrels of electronic ink, making the point that central banks are wreaking havoc. They hurt the poor, the middle class, and the rich. They hurt the wage earners, the business owners, the investors (aka the “rentiers”), and the pensioners. They have variously inflicted rising interest rates, too-high rates, falling rates, and too-low rates. They have imposed perverse incentives to destroy capital and consume wealth.

Those discussions focused on the specific injuries, their causes and effects. An analogy is studying the damage done to the body if it is cut by a sharp blade, bludgeoned by a blunt instrument, burned by a hot flame, or poisoned by a toxic chemical. One can study these things in excruciating detail, without considering one thing.

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Post-Brexit Planning

Brexit will be done by the end of next month, when trade negotiations with the EU will begin. Importantly, Britain’s negotiating position has strengthened immeasurably, and the new government is not afraid to use it.

This Conservative government has a greater sense of political and economic direction than Britain has seen in a long time. Unbeknown to the public, not only will the establishment that obstructed Brexit be side-lined, but a slimmed-down post-Brexit cabinet through a network of special advisers lead by Dominic Cummings will revolutionise central government, reducing bureaucracy and refocusing resources on public service objectives instead of wasted on process.

But there is a dichotomy. While both the government and the new intake of MPs lean towards free markets, Cummings and Johnson will increase government intervention to secure their electoral advantage for the future, and to ensure a planned outcome in a world which in following decades will be dominated by new large Asian economies.

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The Monetary Lessons From Germany

By Alasdair Macleod – Re-Blogged From GoldMoney

Germany suffered two currency collapses in the last century, in 1920-23 and1945-48. The architect of the recovery from the former, Hjalmar Schacht, chose to cooperate with the Nazi successors to the Weimar Republic, and failed. In that of the second, Ludwig Erhard remained true to his free market credentials and succeeded. While they were in different circumstances, comparisons between the two events might give some guidance to politicians faced with similar destructions of their state currencies, which is a growing possibility.

Introduction

Let us assume the next credit crisis is on its way. Given enhanced levels of government debt, it is likely to be more serious than the last one in 2008. Let us also note that it is happening despite the supposed stimulus of low and negative interest rates, when we would expect them to be at their maximum in the credit cycle, and that some $17 trillion of bonds are negative yielding, an unnatural distortion of markets. Let us further assume that McKinsey in their annual banking survey of 2019 are correct when they effectively say that 60% of the world’s banks are consuming their capital before a credit crisis. Add to this a developing recession in Germany that will almost certainly lead to both Deutsche Bank and Commerzbank having to be rescued by the German government. And note the IMF recently warned that $19 trillion in corporate debt is a systemic timebomb, and that collateralised loan obligations and direct exposure to junk held by the US commercial banks is approximately equal to the sum of their equity.

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Socialism Is Bad for the Environment

By Shawn Regan – Re-Blogged From National Review

And markets are much better

As the Soviet Union began to collapse, the socialist economist Robert Heilbroner admitted that central planning had failed economically but said we needed “to rethink the meaning of socialism.” Now it was the thing that had to emerge if humanity was to cope with “the one transcendent challenge that faces it within a thinkable timespan.” Heilbroner considered this one thing to be “the ecological burden that economic growth is placing on the environment.” Markets may be better at allocating resources, Heilbroner thought, but only socialism could avoid ecological disaster.

A metalworking plant in Chelyabinsk, USSR, 1991 (Peter Turnley/Contributor/Getty Images)

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In Defence Of Free Markets

Why is it that no one defends free markets, and socialism, despite all the evidence of its failures, comes back again and again? Unsurprisingly, the answer lies in politics, which have always led to a boom-bust cycle of collective behaviour. Furthering our understanding of this phenomenon is timely because the old advanced economies, burdened by a combination of existing and future debt, appear to be on the verge of an unhappily coordinated bust. But that does not automatically return us to the free markets some of us long for.

Cycles of collective behaviour

Throughout history there have been few long-lasting periods of truly free markets. Contemporary exceptions are confined to some small island states, forced to be entrepreneurial by their size and position vis-à-vis the larger nations with which they trade. The governments of these islands know that the state itself is not suited to entrepreneurship. Only by the state guarding the freedom of island markets and the sanctity of property rights can entrepreneurs serve the people in these communities and create wealth for all.

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BERNIE: ‘You’re Damn Right’ Health Insurance Companies Should Be Eliminated

[Not much doubt – the UGLY face of Socialism in the Democratic party. -Bob]

By Lionel Parrott – Re-Blogged From Liberty Headlines

‘You are not going to be able…to have cost-effective, universal health care unless you change the system…’

(Lionel Parrott, Liberty Headlines) Democratic senator and presidential candidate Bernie Sanders (D-Vt.) isn’t backing down from his call to eliminate health insurance companies, according to an article from The Hill.

After the Republican National Committee (RNC) tweeted Tuesday that the Vermont senator had called for eliminating health insurance companies, Sanders proudly tweeted back: “You’re damn right.”

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Central Planning Is More than Just Friction

By Keith Weiner – Re-Blogged From Gold Eagle

It is easy to think of government interference into the economy like a kind of friction. If producers and traders were fully free, then they could improve our quality of life—with new technologies, better products, and lower prices—at a rate of X. But the more that the government does, the more it burdens them. So instead of X rate of progress, we get the same end result but 10% slower or 20% slower.

Some would go so far as to say, “The free market finds ways to work even through government restrictions, taxes, and regulations.” We won’t address cardboard straws emerging where plastic straws are banned. Or gangs selling illegal drugs on the black market, when they are prohibited by law.

As usual, we want to talk about the most important kind of government intervention. And it happens to be the one kind of government intervention that is accepted by nearly everyone. The intervention supported by the otherwise-free-marketers.

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Professor Calls Out College Administrators for Overwhelming Liberal Bias

Re-Blogged From Total Conservative

You don’t really expect to see a college professor calling out college administrators for their liberal bias, and you really don’t expect to see them do it in the pages of The New York Times, but hey, the Gray Lady throws us a bone every now and then. On Tuesday, Professor Samuel J. Abrams of Sarah Lawrence College argued that while there was no question that professors and academics tended to be on the more liberal side of the spectrum, the imbalance was nothing compared to school administrators, who are practically walking in lockstep towards a more “progressive” future.

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Macroeconomics Has Lost Its Way

By Alasdair Macleod – Re-Blogged From Silver Phoenix

The father of modern macroeconomics was Keynes. Before Keynes there were macro considerations, which were firmly grounded in human action, the personal preferences and choices exercised by individuals in the context of their own earnings and profits. In order to give a role to the state, Keynes had to get away from human action and devise a positive management role for central planners. This was the unstated purpose behind his General Theory of Employment, Interest and Money.

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State or Individual?

By Alasdair Macleod – Re-Blogged From Gold Money

The most important question faced by the human race is almost never addressed in modern times: which should be the master, the state over the individual or the individual over the state? It is particularly relevant today, bearing in mind President Trump is demolishing the established order both domestically and within America’s wider sphere of influence. The blowback he is getting from all the vested interests that have wormed their way into the processes and assumptions that drive government policy is considerable. It is very much relevant to the UK’s Brexit process, where the establishment is trying to scupper the freely expressed will of the people in a referendum.

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Marx: The Worst Man In Modern History

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

It seems extraordinary that in defiance of all factual history and philosophical knowledge anyone should celebrate the bicentenary of the birth of Karl Marx. More than anyone, through wrong-headed ideas, he bears responsibility, indirectly admittedly, for the deaths of an estimated one hundred million people in the last century, and the severe suppression though economic and social servitude of fully one third of the world’s population. And if you also include those who have suffered under the yoke of Marxist-inspired modern socialism, the philosophy that says the state is more important than the individual, you could argue nearly the whole world is influenced by Marxian philosophy today.

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Economics 101: Who Sets Prices?

By Alasdair Macleod – Re-Blogged From http://www.Gold-Eagle.com

Since the advent of nineteenth century socialism, politicians and economists in the centre ground have argued for a balanced approach, where vital services are provided by the state, and capitalism is left to provide the rest. Vital services in a modern economy are taken to include pensions, unemployment and disability benefits, healthcare and education. Most states also provide communications, such as rail and road infrastructure, electrical grids and perhaps telecommunications. They often own and operate on behalf of the people utilities, such as the railways, ports, electricity and water.

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Brexit – The Battle For Ideas

By Alasdair Macleod – Re-Blogged From GoldMoney

The battle for ideas in the Brexit debate comes down to two basic economic approaches. The neo-Keynesian macroeconomists in the permanent establishment, who manage the state as economic planners and regulators are on one side. They are naturally sympathetic with the policies and ideals of their EU counterparts. Against them are those who argue that in economics free markets must have primacy over the state.

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Will Macro-Economists Ever Learn?

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

As we lurch through successive credit crises, central bankers and economists believe they learn valuable lessons every time, and that the ultimate prize, the suppression of business cycles through monetary policy, will be achieved. Enormous effort is put into computer models to enable economists to predict the future, and no doubt, the modellers are now working with artificial intelligence to improve their accuracy.

We saw, over Brexit, how wrong the Bank of England’s and the UK Treasury’s models were, and these errors were also evident in the OECD’s model. Brexiteers smelled conspiracy, but in the absence of evidence, perhaps we should give them the benefit of the doubt and assume the errors were genuine. If so, all computer economic modelling has been a waste of time.

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When Will Free Markets Emerge?

By George Smith – Re-Blogged From http://www.Silver-Phoenix500.com

If someone asked you to define “free market,” could you?  Could you do it on the spot without recourse to dictionaries or other crutches?

There’s an old tale about the origin of the term “laissez-faire” that gets to my point.  Here’s the write-up in Wikipedia:

The term laissez faire likely originated in a meeting that took place around 1681 between powerful French Comptroller-General of Finances Jean-Baptiste Colbert and a group of French businessmen headed by M. Le Gendre. When the eager mercantilist minister asked how the French state could be of service to the merchants and help promote their commerce, Le Gendre replied simply “Laissez-nous faire” (“Leave it to us” or “Let us do [it],” the French verb not having to take an object).

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The Long March BACK through the Institutions Dupe

By Cheadleg – Re-Blogged From iPatriot

Do the words above sound familiar? They are a take-off of the slogan that has motivated the socialist, Leftist movement since WWII.

The Long March refers to Mao Zedong’s grueling year-long march in 1934/35 with his Peoples’ Liberation Army around the rocky periphery of China to eventually overcome the Nationalist forces and establish the current Chinese Communist state. “Long March” has become a metaphor for long-lasting struggle through many hardships, resulting in final victory.

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Free Market Is Rising From the Ashes of Obamacare

By Will Ricciardella – Re-Blogged From Independent Journal Review

The complexity and costs of Obamacare mandates regarding medical records, billing codes, and prior authorizations forced thousands of independent doctors, mostly primary care doctors, to become part of large hospital networks to help absorb the added costs. Add the complexity and lack of cost transparency for the patient, and you have a recipe for a free market solution.

Government Recovery Act Funds South Florida Low-Income Health Clinics

Joe Raedle/Getty Images

Technology Disrupts White Collar Workers

By David McWilliams – Re-Blogged From http://www.Gold-Eagle.com

– Every era, every century, every generation has its massive technological disruption
– Taxi drivers being “disrupted” by technology of Uber
– History shows how “middle men” frequently made redundant
– Skill set of many professionals today can be replicated by machines and technology
– Technology may make lawyers, accountants, architects and doctors redundant
– We risk “cannabalising ourselves” with internet and emerging technologies

Jean-Luc Picard “assimilated” by the Borg in Star Trek

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Back to Economic Basics

   By Bob Shapiro

My blog is about 2½ years old now, and I’ve had well over 30,000 views. Articles automatically also get posted onto my Facebook page, where a larger number of my friends see them; most of the comments show up on my Facebook page.

While I still write posts myself, the lion’s share are re-posts from friends around the world who write well on the issues which are important to me (hey, it’s my blog). Many times, I fall into the trap of forgetting that many (most?) readers have zero training (and less understanding) of the subjects I blog about.

Because so many people (Americans and not) have no real clue about the good that is Capitalism and the benefits that each person enjoys because of Capitalism, I’d like to go over a few basics. So, this is for the good people out there who say things like, “He can afford it,” and “He’s just greedy and only worrying about making a profit.”

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Your Money or Your Life

By Herman Gazort – Re-Blogged From iPatriot

The armed robber puts a gun in your back and says it simply and frankly. The Marxist socialist says the same thing with more words.

As a matter of fact, the socialists main tool is words. They weaponize them by redefining concepts. They take a privilege and say it is a right. A socialist redefines himself as a “liberal” to confuse liberty with socialism. They redefine “tolerance” to confuse mercy and impunity and brand justice as “intolerant.” Now they redefine perversion as “sexual preference” so that soon pedophilia, necrophilia and animalism will be as “acceptable” as homosexuality. They have converted emasculation into “sensitivity” and masculinity into monstrosity, but in their insane rebellion against truth, the most “feminist” of “feminism” go to the most antifeminists of beliefs — Islam. In recent cases they are trying to convert immigration — a privilege by any sane standard — into a “right” for the purpose of eliminating nationality and thus national defense, sovereignty and patriotism. Socialists in judicial power will continue to do so until executive power stops their abuse and enforces constitutional law.

your-money-or

(Congratulations for standing up for RIGHTS President Trump.)

Globalists say they’ll take your money and kill you (wage external war or internal strife) if you don’t accept their debt based money, or accept their conditions of interest and political policy (like “human rights,” “social justice,” “tolerance,” “political correctness” and, eventually “global government and the New World Order.”) — These will use the money they created from our future to wage street protests and make nations fight each other Russia or China if you reject their money, their debt or their conditions, like not “bailing out” their banks with our future and the future of our future generations. Your money or your life — same concept different words.

In the “Affordable Health Care” plan, the globalists are, saying that they’ll keep you from even getting into a hospital if you don’t pay a big and ever increasing deductible or accept an unpayable debt. Same concept different words.

Communists say we’ll take your productive facilities or we’ll kill or throw you out. So they do, and the only thing they prove is that bureaucrats and politicians can’t produce, because they only know how to steal. And when the leaders only know how to steal, the people can’t learn how to produce. But they do learn how to steal from each other, so parasites eat parasites. In the early stages people have to wait in long lines to get bread, soap or toilet paper. In later stages, they hunt and eat each other. Same concept different words.

Fascists say, you need to buy our protection from competition with higher taxes or we’ll tax you to death and send criminal elements to shut you down. So, the net effect is big, inefficient, corporations that produce goods of less value for more costs, because of their overhead to government and banks. Honest, hardworking, creative competition dies out, and so does the morality of exchanging value for value. Same concept different words.

What dies is sovereignty, for the individual and the nation.

With the loss of sovereignty comes the loss of freedom. True freedom, the responsibility-driven freedom of doing the best and promoting the common good instead of the average bad of giving in and taking in so that you get some loot. It is, in essence a gradual loss of values which comes at a gradual increase in price. This is what religion calls selling your soul to the devil. The bigger the religion, the more formalized is the acceptance and “tolerance” of the average bad. Now, Marxism is the biggest religion.

The same concept — Your Money or Your Life.

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A Tale Of Two Economies: Singapore And Cuba

By Frank Holmes – Re-Blogged From http://www.Gold-Eagle.com

On Friday November 25, Fidel Castro died at age 90. The former revolutionary and hardline dictator of Cuba was among the 20th century’s longest-serving leaders, third only to Elizabeth II and Bhumibol Adulyadej, the King of Thailand, who passed away in October.

Castro’s death comes at a pivotal moment in US-Cuban relations. With trade between the two countries on the path to normalization, and with US airlines making scheduled flights to Havana for the first time in more than 50 years, President-elect Donald J. Trump has pledged to reinstate many of the Cold War embargos that were lifted by President Barack Obama.

“If Cuba is unwilling to make a better deal for the Cuban people, the Cuban/American people and the US as a whole, I will terminate deal,” Trump tweeted on November 28.

In light of Castro’s passing, we are rerunning this Frank Talk from March 2015, in which Frank compares and analyzes the widely divergent economies of Cuba and Singapore under their now-deceased leaders, Castro and Lee Kuan Yew.

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Fiction, Fairy Tales And Fiat

By Guy Christopher – Re-Blogged From https://www.moneymetals.com

Do young Americans today know anything about economics?

No, they don’t, according to a study during the 2016 presidential primary season, which says lots of other Americans don’t either.

The survey found 58% of millennials favor government-run socialism (statistically 6 out of 10), while a nearly identical number (64%) don’t want government interference in free markets.

The incompatible findings make no sense, unless… Americans aged 18-24 simply don’t understand the real meanings of either concept.

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Regulation – The Hidden Curse

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

Regulations are nearly always introduced with the best intentions. In financial services, they aim to stop unscrupulous brokers and banks from ripping off the public through bad practices. Manufacturers are banned from making products which are dangerous to children, the environment, or which might fail through shoddy workmanship. However, state intervention in commercial matters is based on shaky grounds, consistent with denial of the role and workings of markets, and an overriding desire to interfere.

This contrasts with a true understanding of why free markets work, and the control the consumer exercises over prices and choice, subordinating them to his subjective decisions. Consequently, regulation is based on an unreasoned belief that the individual needs state intervention to ensure standards are maintained, and that bad practices will be eliminated. The incorrect assumption is that free markets encourage unscrupulous manufacturers and service providers to defraud the consumer, when in fact, reputation becomes the paramount relationship in trade.

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Greed – Good or Bad?

cropped-bob-shapiro.jpg   By Bob Shapiro

Most Americans are greedy most of the time.

If we own a business, we want as much profit as we can generate. If we buy stocks, we want the price to go way up. If we work, we want to be paid as much as we can get. If we sell a house or a car, we want to get as much as we can. Of course, when we buy a house or a car, we want to pay as little as possible.

In every single transaction, we want to get the better of the deal compared to the person on the other side of the table. Is this a good thing – or an evil we should strive to stamp out?

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