When interest rates are kept arbitrarily low by government policy, the effect must be inflationary. In the first place, interest rates cannot be kept artificially low, except by inflation. The real or natural rate of interest is the rate that would be established if the supply and demand for real capital were in equilibrium. The actual money interest rate can only be kept below the natural rate by pumping new money into the economic system. This new money and new credit add to the apparent supply of new capital just as the judicious addition of water add to the apparent supply of real milk.— Henry Hazlitt
Nominations for Nanny of the Month.
Ugh. Why can’t government just leave us alone?
Edward Snowden thinks of himself as a cyber-age guerrilla warrior, but in reality he is a self-publicizing narcissist. He did not find or expose anything illegal, nor did he exhaust all legal and constitutional options to express his reservations about the intelligence and security services. He did not attempt to limit any potential damage in making his point. He did not show that any agency activities were unreasonable in law. Let us not imbue his cowardice with higher motives. Let us not confuse his egotism with public service. Let’s not call his treachery by lesser terms. Let us be clear about the intent and impact of his actions. Let us be clear to the American people and their allies about the threats they now face from enemies inside and out, terrorist and criminal. For once, let’s say what we mean. Let us call treason by its name.—
This editorial is Exhibit A of a circle-the-wagons, defend the establishment, assuming-what-you’re-trying-to-prove argument in defense of a government so drunk on power it can’t distinguish between terrorists and the very citizens its tasked with protecting. The threats to our liberties imposed by our own government are far more imminent than any existential terrorist threat out there.
We need true conservatives (and true classical liberals) who are willing to reduce the size, scope, power, and authority of government in our lives. The biggest problem with our government isn’t that they have spied on us; it’s that they are even capable of it to begin with.
Peter Schiff - Bailing Out Banks Put Homeowners Underwater
We keep hearing about the Federal Reserve “tapering” its quantitative easing exercise in money creation. But a tweet from the St. Louis Fed says: “adjusted monetary base rises by more than $65 billion over the past two weeks to $3.963 trillion.” The sum of currency in circulation plus deposits held by banks at the Federal Reserve, this measure of money supply stood at less than $900 billion before the financial crisis. What will happen to prices in the economy once banks start lending this money out to customers?—
Did you get that? Our money supply increased from around $900 billion to almost $4 trillion in the last few years. This goes beyond tinkering—it has been and will continue to be hugely disruptive to our economy and standard of living.
There is quite a bit that we don’t know [about climate change] so you might want to gulp down an extra bit of oxygen before starting the next sentence. First, we don’t know that climate change is even happening; in the next instance, we don’t know whether it would be a bad thing or a good thing if it were, for it is quite possible that we will like it when Iceland is famous for her white wines; in the third place, we don’t know, if it is happening and if it is bad, that we, as in we humans, are in any way responsible for it, another possible culprit being the flaming hot ball of fire in the sky; and fourth, we don’t know that anything can be done about it.—
However, one thing we can be pretty sure of is that if it is happening, and if it is bad, and if we are causing it, and if we can reverse it, then the last people on earth we should entrust with the responsibility of reversing it would be those statist functionaries who are clamoring for more power in the name of climate change. I would rather die in a rising ocean of inconvenient truths than to pass out the rest of my days smelting our old toothpaste tubes before an important bureaucrat in that big office building across the continent says that it is safe to throw them away.
The people who brought you trillion dollar deficits, the government education system, the spiraling chaos of Middle East politics, the roll-out of Obamacare, departments of motor vehicles everywhere, and a Federal Reserve honeycombed with crony capitalists, are now asking, on the basis of their record, a record that looks like the trail left by an F-5 tornado, to be put in charge of the weather.
And so I am afraid that if you take longer than a couple seconds to think about whether to be against this galloping folly, then you are a worthy recipient of everything you are about to get.