You are browsing the archive for 2014 March 18.

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New Paper: “”Roundaboutness is Not a Mysterious Concept”

March 18, 2014 in Economics

By Mises Updates

Nicolas Cachanosky, Metropolitan State University of Denver

Peter Lewin, University of Texas at Dallas – School of Management – Department of Finance & Managerial Economics

March 16, 2014

Abstract: 

We apply the EVA® terminology to the concepts of roundaboutness and average period of production in capital theory. By doing this we show that these terms have a clear and well understood financial interpretation. A financial application to capital theory helps to clarify obscure and controversial economic terms. We then extend our financial interpretation of roundaboutness and average period of production to the Austrian business cycle theory and show how this approach can be used to shed light on the subprime crisis.

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Source: MISES INSTITUTE

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Wednesday: Patients, Families, Doctors Host Medical Marijuana Educational Forum in Syracuse, New York

March 18, 2014 in PERSONAL LIBERTY

By drosenfeld

Advocates Say There Are Enough Votes to Pass Medical Marijuana in NY: Senate Must Act Now

East Syracuse – Wednesday, patients, families, advocates, and doctors will host an educational forum in East Syracuse. The public forum is part of the March for Compassion—a month-long series of actions and events across the state to educate New Yorkers about medical cannabis and build support for New York’s comprehensive medical marijuana proposal – the Compassionate Care Act (A.6357-A -Gottfried) / S.4406-A -Savino).

March 18, 2014

Drug Policy Alliance

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Source: DRUG POLICY

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2013 Top Mises Dailies

March 18, 2014 in Economics

By Mises Updates

The authors of numbers 19, 21, 27, 28, 35, and 48.

The authors of numbers 19, 21, 27, 28, 35, and 48.

A bit late, but some great reads here! Top 50 most-read Mises Dailies during 2013, by unique page views:

1. A Virtual Weimar: Hyperinflation in a Video Game World – Peter C. Earle
2. The Truth About SwedenCare – Klaus Bernpaintner
3. Hushing Up Conspiracy Theories – Jeff Riggenbach
4. How the Stock Market and Economy Really Work – Kel Kelly
5. The Hiroshima Myth – John V. Denson
6. The Money-ness of Bitcoins – Nikolay Gertchev
7. Cartman Shrugged: The Invisible Gnomes and the Invisible Hand in South Park – Paul A. Cantor
8. Decriminalize the Average Man – Wendy McElroy
9. Inflation and the Fall of the Roman Empire – Joseph R. Peden
10. Lincoln’s Inversion of the American Union – Donald W. Livingston
11. Where Is the Inflation? – Mark Thornton
12. The Great Thanksgiving Hoax – Richard J. Maybury
13. The Truth About the “Robber Barons” – Thomas J. DiLorenzo
14. Bitcoin: Money of the Future or Old-Fashioned Bubble? – Patrik Korda
15. The Fed Must Inflate – Chris Martenson
16. A History of Labor Unions from Colonial Times to 2009 – Morgan Reynolds
17. The Forgotten Depression of 1920 – Thomas E. Woods, Jr.
18. The Economics of ObamaCare – Robert P. Murphy
19. The Libertarian Paradox – Llewellyn H. Rockwell Jr.
20. Krugman’s Call for a Housing Bubble – Daniel J. Sanchez
21. How to Fight the Modern State – Hans-Hermann Hoppe
22. How the Paper Money Experiment Will End – Philipp Bagus
23. The Keynesian Endgame – David Stockman
24. Native American Reservations: “Socialist Archipelago” – Andrei Znamenski
25. Ten Economic Blunders from History – John S. Chamberlain
26. The Ethics of Whistleblowing – Ben O’Neill
27. The Paradox of Imperialism – Hans-Hermann Hoppe
28. The Logical Beauty of Libertarianism – Hans-Hermann Hoppe
29. The Oslo Housing Bubble Syndrome – Mark Thornton
30. What Caused the Irish Potato Famine? – Mark Thornton
31. Judge Napolitano on the Worst Supreme Court Decisions – Judge Andrew P. Napolitano
32. The Economic Sense in Game of Thrones – Matt McCaffrey
33. Why Legalize Now? – Mark Thornton
34. The Bitcoin Money Myth – Frank Shostak
35. Outlawing Jobs: The Minimum Wage – Murray N. Rothbard
36. Elizabeth Warren’s Unwarranted Wage – Walter Block
37. Recessions: The Don’t Do List – John P. …read more

Source: MISES INSTITUTE

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Economic Freedom of the States of India 2013

March 18, 2014 in Economics

India’s economic freedom has increased notably since the 1990s, but the level of economic freedom within India varies greatly. The latest Economic Freedom of the States of India report shows how the state of Gujarat has widened its lead on the index, and includes a chapter on how Bihar, the poorest Indian state, took advantage of improved national policies to achieve double-digit growth.

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Source: CATO HEADLINES

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Libertarian Purists: Libertarian on Everything — Except Liberty

March 18, 2014 in Blogs

By Robin Koerner

The American Liberty movement is no longer nascent. Its mainstreaming is under way, as evidenced by this article in the New York Times — the paper that (almost) defines the American mainstream — about the impact of liberty-focused activists on the (“mainstream”) Republican party, as reflected at CPAC last week.

Both culturally and politically, libertarianism is on the rise.

At its simplest, it is a philosophy that asserts the simple principle that we are all free to live our lives as we please inasmuch as we do not limit the freedom of others to do the same. It recognizes that we all have different backgrounds, desires and ambitions, and different metrics and systems for judging the behaviors and choices of ourselves and others.

Since it rests on the notion that one human being cannot know what is best for another — or at least cannot know it better than the other person, himself, it is an essentially humble philosophy in disposition and an essentially tolerant philosophy in prescription. Indeed, tolerance, manifest as lack of aggression, is just about its only hard-and-fast prescription.

Because libertarians put the moral burden of justification on those who would use coercion (reduce liberty) to do good, and the State is inherently coercive (it puts you in jail if you don’t comply), they emphasize civil society as critical to delivering welfare to those less fortunate among us. Civil society includes non-state organizations, formed voluntarily, that act privately to better the lives of their members and, usually, their non-members. These organizations can be more nimble and effective than the state as the good they do does not involve the forced transfer of resources from some people to others, nor does it involve the use of such co-opted resources in ways that the people from whom they are taken would not approve. Moreover, civil society can often deliver much more targeted remedies of social and economic injustice than can the one-size-fits-all programs of government. A libertarian society, then, harnesses for social good the civility of the people who comprise it.

So there we have the three dispositions of a good libertarian: humility, tolerance of diversity, and civility.

Strange, then, that arguably the biggest drag on the rise of libertarian thought is the lack of humility, tolerance and civility of some of its most fervent advocates. <br …read more

Source: ROBIN KOERNER BLOG

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Ron Paul in ‘USA Today’

March 18, 2014 in Economics

By Mises Updates

From his column in today’s USA Today:

Critics point to the Russian “occupation” of Crimea as evidence that no fair vote could have taken place. Where were these people when an election held in an Iraq occupied by U.S. troops was called a “triumph of democracy”?

Perhaps the U.S. officials who supported the unconstitutional overthrow of Ukraine’s government should refocus their energies on learning our own Constitution, which does not allow the U.S. government to overthrow governments overseas or send a billion dollars to bail out Ukraine and its international creditors.

Though the Obama administration has applied some minimal sanctions on selected Russian and Crimean individuals, neither the U.S. nor the EU can afford significant sanctions against Russia. Global trade provides too much economic benefit to both sides.

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Source: MISES INSTITUTE

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How the Artificial Boom of 1914-1929 Caused the Great Depression

March 18, 2014 in Economics

By Mises Updates

732px-Unemployed_men_queued_outside_a_depression_soup_kitchen_opened_in_Chicago_by_Al_Capone,_02-1931_-_NARA_-_541927

by David Stockman

From David Stockman’s Contra CornerRemarks to the Committee For The Republic, Washington DC, February 2014 (Part 3 in a 6-Part Series) Go to Part 1.

In this setting, Bubbles Ben 1.0  (New York Fed Governor Benjamin Strong) stormed in with a rescue plan that will sound familiar to contemporary ears. By means of his bond buying campaigns he sought to drive-down interest rates in New York relative to London, thereby encouraging British creditors to keep their money in higher yielding sterling rather than converting their claims to gold or dollars.

The British economy was thus given an option to keep rolling-over its debts and to continue living beyond its means. For a few years these proto-Keynesian “Lords of Finance” —- principally Ben Strong of the Fed and Montague Norman of the BOE—-managed to kick the can down the road.

But after the Credit Anstalt crisis in spring 1931, when creditors of shaky banks in central Europe demanded gold, England’s precarious mountain of sterling debts came into the cross-hairs.  In short order, the money printing scheme of Bubbles Ben 1.0 designed to keep the Brits in cheap interest rates and big debts came violently unwound.

In late September a weak British government defaulted on its gold exchange standard duty to convert sterling to gold, causing the French, Dutch and other central banks to absorb massive overnight losses. The global depression then to took another lurch downward.

Inventing  Bubble Finance : The Call Money Market Explosion Before 1929

But central bankers tamper with free market interest rates only at their peril—-so the domestic malinvestments and deformations which flowed from the monetary machinations of Bubbles Ben 1.0 were also monumental.

Owing to the splendid tax-cuts and budgetary surpluses of Secretary Andrew Mellon, the American economy was flush with cash, and due to the gold inflows from Europe the US banking system was extraordinarily liquid. The last thing that was needed in Roaring Twenties America was the cheap interest rates—-at 3 percent and under—that resulted from Strong’s meddling in the money markets.

At length, Strong’s ultra-low interest rates did cause credit growth to explode, but it did not end-up funding new steel mills or auto assembly plants.  Instead, the Fed’s cheap debt flooded into the Wall Street call money market where it fueled that greatest margin debt driven stock market bubble the world had ever seen. By 1929, margin debt on Wall Street had soared to 12 percent …read more

Source: MISES INSTITUTE

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How Measuring GDP Encourages Government Meddling

March 18, 2014 in Economics

By Mises Updates

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John Cochran writes in today’s Mises Daily: 

Despite recognizing the many (insurmountable?) problems with the accuracy of national income and product accounts, Ms. Coyle takes the other side. She “joins the Commerce Department in celebrating her pet datum as ‘one of the greatest inventions of the twentieth century.’” What is Coyle’s justification for this positive assessment of GDP? Grant answers, “GDP may or may not measure human happiness, but it does measure growth, she says, and on the rate of growth in output no small part of human satisfaction depends. Grant adds, “The unspoken corollary is that, if growth falls short of some politically desired minimum, it’s incumbent on government to spend money and/or to print it.”

Ms. Coyle’s defense of GDP is unconvincing to Mr. Grant as he expects it will be to discerning readers. Grant draws the following insight from the book:

Though it was evidently not Ms. Coyle’s intention, I read her book as a brief for “positive non-intervention,” the Cowperthwaitian approach to macroeconomic management. If one really can’t measure economic activity, perhaps it’s better not to meddle in it.

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Source: MISES INSTITUTE

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Mainstreaming Fringe Science with John Holdren

March 18, 2014 in Economics

By Paul C. &quot;Chip&quot; Knappenberger

Paul C. “Chip” Knappenberger

In recent months, White House science adviser John Holdren has repeatedly pushed the link between extreme weather events and human-caused climate change well beyond the bounds of established science. Now, veteran climate scientists are pushing back.

The White House science adviser confuses global-warming fact and fancy.”

Mr. Holdren’s efforts started in January, as much of the nation was shivering in the midst of an excursion of arctic air into the lower 48 states.

Anyone with a passing interest in the climate of the United States knows that is hardly an unusual occurrence (“citrus freeze” anyone?), but outfit the chill with a new, scarier-sounding moniker and a blase-sounding “cold-air outbreak” goes viral as the “polar vortex.”

Apparently, sensing the time was ripe for a bit of global-warming alarmism, the White House released a video titled “The Polar Vortex Explained in 2 Minutes,” featuring Mr. Holdren describing how “a growing body of evidence suggests that the kind of extreme cold being experienced by much of the United States as we speak is a pattern that we can expect to see with increasing frequency as global warming continues.”

Although this statement is not outright false, it is, at its very best, a half-truth — and a stretch at that. In fact, there is an ever-larger and faster-growing body of evidence that directly disputes Mr. Holdren’s contention.

This was pointed out last month in a letter to Science magazine authored by five veteran climate scientists, who are all experts in the field of atmospheric circulation patterns.

The scientists disputed Mr. Holdren’s explanation, writing that “we do not view the theoretical arguments underlying it to be compelling” and concluded that while such research “deserves a fair hearing to make it the centerpiece of the public discourse is inappropriate and a distraction.”

One of the letter’s authors, atmospheric science professor John Wallace from the University of Washington, even wrote a guest post at the popular Capital Weather Gang blog run by The Washington Post, to proclaim, “I disagree with those who argue that we need to capitalize on recent extreme weather events to raise public awareness of human-induced global warming.”

Such pushback didn’t stop Mr. Holdren, though.

A couple of weeks ago at a congressional hearing, Mr. Holdren attacked the views of University of Colorado professor Roger Pielke Jr. concerning the connection between anthropogenic global warming and the ongoing drought in the Southwest.

Mr. Pielke, an expert on the relationship between natural disasters and climate change, had previously testified to Congress that the best science regarding …read more

Source: OP-EDS

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Three Years after U.S. Intervention, Libya's an even Bigger Disaster

March 18, 2014 in Economics

By Gene Healy

Gene Healy

Libya suffered through an eventful St. Patrick’s Day on Monday: car bomb attacks in Benghazi killed at least eight people, and the U.S. Navy SEALs scored “one for the Morning Glory” by capturing the runaway oil tanker bearing that name in order to return it to the Libyan government, such as it is.

Obama’s Libyan adventure looks like a moral vanity project carried out by careless people who couldn’t be bothered to worry about unintended consequences.”

Earlier this month, the North Korean-flagged tanker switched off its satellite transponder — a device that could probably do without an “off” button — and sneaked into Libya’s largest oil port, whereupon Libyans linked to a breakaway eastern militia made off with millions of dollars in oil. But the return of the Morning Glory hardly fixes the problems confronting Libya.

Three years ago today, President Obama announced that America would “not stand idly by in the face of actions that undermine global peace and security;” he’d decided to order military action in “support for a set of universal values.” The next day, the bombing began.

How did that work out? Splendidly! says one of the principal architects of the war, former National Security Council official Samantha Power. Last summer, after becoming U.S. ambassador to the United Nations, Power tweeted: “Great example: Qadhafi fell because the Libyan people bravely stood up, the U.S. stood strong, and the Arab League stood united. #Results.”

Let’s test that self-congratulatory hashtag against what a top official from the previous administration once contemptuously called the “judicious study of discernible reality.” “Political Killings Still Plaguing Post-Qaddafi Libya” is the headline from the New York Times last week, reporting, “[M]ore than 100 prominent figures, senior security officials, judges and political activists have been assassinated in two years, and the wave of killings is decimating local leadership and paralyzing the government and security forces.” Unrest has likewise decimated Libya’s oil production, and “militias hold 8,000 people in prisons.”

But didn’t we at least stop a genocide? That’s what State Department legal adviser Harold Koh suggested in an interview. Koh, previously an ardent opponent of presidential warmaking, gave Obama legal cover for Libya, arguing that bombing Libya didn’t count as “hostilities” under the War Powers Resolution.

Koh defends that decision by insisting that “thousands of lives were saved” — which isn’t much of a legal argument. It’s also not true.

As political scientist Alan J. Kuperman pointed out at the time, Obama “grossly …read more

Source: OP-EDS