There is no exit strategy because the results of the Fed withdrawing its artificial support would be disastrous for the US Treasury and in the short-term, the US economy.
MARKETS
Singapore A Wise Owl Among Currency Snakes
Currency devaluation is not a winning strategy, especially for a country with a strong balance sheet.
Eating Quinoa: Capitalist Exploitation?
The newly rediscovered, nutritious “miracle grain” quinoa, eaten increasingly by health-conscious consumers in the developed countries, is making the rich richer and the poor poorer. At least if we are to believe the recent article in The Guardian newspaper of the...
AFL-CIO Is Wrong: Right To Work Laws Are Not The “Right-to-Freeload”
Right-to-work laws prevent unions from imposing mandatory fees, giving employees the right to work without paying union dues. Otherwise, right-to-work has no effect on collective bargaining. All other negotiations continue as before. What’s wrong with that?
Make Union Representation Voluntary: Workers Should Choose Their Representatives
Collective bargaining laws give unions an effective monopoly on many state and local government workforces.[1] They force the government to negotiate employment terms with the union, and all employees must accept that union’s representation. Unions use this power to...
To Braid or Not to Braid
Benta Diaw immigrated to the United States from Senegal. She decided to open a business braiding hair as she was taught by her grandmother in Africa. However, the state of Washington declared her business illegal. Was Diaw misleading her clients and using dangerous...
Why Whole Foods CEO John Mackey Was Right to Call Obamacare “Fascist”
Whole Foods co-CEO John Mackey recently backed off his description of Obamacare as “fascism.” Mackey stated, “I made a poor word choice to describe our health care system, which I definitely regret. The term fascism today stirs up too much negative emotion with its...
The Trillion Dollar Trick
The birth, and the apparent death, of the trillion dollar platinum coin idea may one day be recalled as a mere footnote in the current debt crisis drama. The ultimate rejection of the idea (which was to use a loophole in commemorative coinage law to mint a platinum...
Inflation Propaganda Exposed
Economists who hold the popular view that expanding the money supply will provide the best medicine for our ailing economy dismiss the inflationary concerns of monetary hawks, like me, by pointing to the supposedly low inflation that has occurred during the current...
A Bank CEO’s Advice to Congress
With the “fiscal cliff” mess not solved but merely kicked down the road a few months, it’s a good time to summarize a few points I make in my book, The Financial Crisis and the Free Market Cure. I hope – but do not expect – that our elected representatives learn to...
A CEO’s Message to Congress
In the long term, we cannot consume more than we produce.
The False Security of the SEC
Founded in the aftermath of the Great Depression, the stated mission of the Securities and Exchange Commission (SEC) is “to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.” While this seems like a laudable goal, like...
No Way Out
By upping the ante once again in its gamble to revive the lethargic economy through monetary action, the Federal Reserve's Open Market Committee is now compelling the rest of us to buy into a game that we may not be able to afford. At his press conference this week,...
Fedophilia: Irrational Adoration of the Federal Reserve System
Although the movement to “End the Fed” has a considerable popular following, only a very tiny number of economists—our illustrious contributors amongst them—take the possibility seriously. For the rest, the Federal Reserve System is, not an ideal currency system to be...
Central Banks Hedge Their Bets
Gold appears to be headed for an impressive price appreciation for the second half of 2012. Since the beginning of July, gold is up almost 10 over the same time frame. What is noteworthy here is that in recent months, fears of a worldwide recession have increased...
The Profit Motive is Good; The Loss and Theft Motive is Evil
Obama and his wife, call for service to replace the motive of profit. Yet if money and profit are so bad, why do those seeking the trillions in redistributed wealth want it so badly?
Magical Thinking Won’t Stop the Layoffs
Associated Press and FoxNews.com reports: Medical supply giant Stryker is the latest company to announce job cuts in anticipation of coming costs associated with Obamacare, even though the man who inherited a fortune from the company's founder is a fan. The company...
Rent Control Hypocrites
Those who benefit from government coercion seldom like it when the gun is turned around and pointed at them. They have no hesitation to demand that government use compulsion for their benefit, but complain when compulsion is directed at them. As an example,...
Teamwork and the Virtue of Independence
If we are to believe people like President Obama who famously said: “You didn’t build that”, individual accomplishment is insignificant; only as a group we can build something. While collaboration, trade, and learning are great benefits of living in a society and we...
Zoning Versus the Internet
The stated purpose of zoning is to control land use within a community to prevent “incompatible” land uses and to promote planning. Most Americans accept zoning as a “necessary evil” that prevents pawn shops and factories from operating in residential neighborhoods....
Altruism is Not a Guide for Living—or for Business
Most of us pursue self-interest every day: we eat nutritious food, engage in productive work (to have a purpose and to make a living), look after our health, enjoy recreation and entertainment, spend time with friends and loved ones, and go to the mall to buy things...
Why Governments Should not Interfere in the Sale of Publicly Traded Companies
This is an issue mostly in countries with abundant natural resources and governments bent on economic nationalism, but it nevertheless poses an interesting ethical dilemma. Canada’s economy is dominated by resource companies: in oil and gas, minerals, the forest...
What Drives Innovation, the Engine of Economic Growth?
Many economists today are arguing that the unprecedented era of innovation—the last 250 years or so since the industrial revolution—is going to be over soon, ending economic growth. Why should we care about economic growth? Because our well-being depends on it—the...
Inflation: Washington is Blind to Main Street’s Biggest Concern
Journalists, politicians and economists all seem to agree that the biggest economic issue currently worrying voters is unemployment. It follows then that most believe that the deciding factor in the presidential race will be the ability of each candidate to convince...
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