… Troubles Our Sleep …
It is the vision of what the United States will be like when the authorities have obliterated almost three millennia of monetary progress and have their boots on our necks.
Here’s Peter Bofinger, a leading German Keynesian economist, in Der Spiegel magazine:
“With today’s technical possibilities, coins and notes are in fact an anachronism. They made payments incredibly difficult, with people wasting all sorts of time at the cashier as they wait for the person ahead of them to dig through their belongings to find some cash, and for the cashier to render change (rather than, for example, waiting for someone to find the right credit card, complete the transaction, and wait for approval).
But the additional time is not the largest benefit of the elimination of cash. It dries out the markets for moonlighting and drug trafficking. Almost a third of the euro cash in circulation consists of 500-euro notes. No one needs those for shopping; light-shy figures use them for their activities. [Also] it would be easier for central banks to impose their monetary policies. At this time, they cannot push interest rates appreciably below zero because the savers would hoard cash. If there is no cash, the zero bound is eliminated.”
They said they were going to make me an advisor ... Bofinger discovers they lied to him.
Painting by Zdzislaw Beksinski
This is the first time we’ve been in Colombia. Greener, more mountainous, richer, newer, and more flowery – it is many things we didn’t expect.
We’ve seen a lot of press on Medellín. It is supposed to be lively. It is “springtime all year round.” It is beautiful. And it is a lot safer now than when drug kingpin Pablo Escobar called it home.
We haven’t been here long enough to know if those things are true. All we know so far is that it is so modern, so big, and so wealthy that we are a bit disappointed.
We’d expected a bit more charm and authentic poverty. Maybe they are on the other side of town… we don’t know. We’ll let you know if we find out anything more…
A mugshot of former Colombian drug lord Pablo Escobar Gaviria – at the time he still seemed fairly confident. It is no exaggeration to say that he once owned Medellín lock, stock and barrel – but a great many things have changed in Colombia since his heyday. Notorious kingpin Pablo is no longer among the quick, but at the height of his power he was without a doubt the richest criminal ever, worth an estimated $30 billion. There is broad agreement that Medellín is a nicer place without him.
Another Keynesian Voodoo Economist Wants to See Cash Abolished
We have a few more bad news and for a change also some good news with respect to the ongoing attempt to prepare the ground for a ban of cash currency. By now everybody should know how this works: Whenever another step to curtail individual liberty further is in the preparatory stage, the ruling class starts trial balloons in the mainstream media, flanked by “expert” opinion pieces, to see how people react. If there is an uproar, they will pull back and wait for a better opportunity. If there is no uproar, you simply wake up one morning with yet more of your personal freedom taken away for the “collective good”.
This is why contrary to what some people seem to think, it is not a good idea to ignore what superficially appear to be outlandish notions. After all, as current EU commission president Jean Claude “we lie if we have to” Juncker once explained, this is precisely how the EU’s centralizers go about imposing policies which they suspect might be unpopular with voters.
A cash ban would bring about even more thorough surveillance and be one step closer to total bureaucratic control
Old Age and Treachery
Old age and treachery will always triumph over youth and skill. At least, that is the way it looks.
The jobs picture, for example, is even bleaker. And depriving young people of jobs is like depriving pandas of bamboo shoots: It’s all they have.
Older people can watch their stocks, real estate, and bonds go up in price. A young person can only look at the “Help Wanted” ads … and hope for a break.
David Bowie – Young Americans. Will she still want the young American today?
They All Said a Strong Currency is Bad …
We feel absolutely certain that the people running the SNB won’t be convinced by any evidence, whether theoretical or empirical, that puts their misguided assessment of the alleged dangers of “deflation” and a strong currency into doubt. In spite of Switzerland’s reputation as a nation of that holds conservative values in high esteem and is among the economically most free in the world, its central bankers are almost by necessity strong believers in central planning and assorted Keynesian and monetarist shibboleths.
We say “almost by necessity” because admitting to the truth of the matter, namely that the institutions of fiat money and central banks are utterly alien to the market economy and are harming it more than just about any other human invention, would be tantamount to conceding that they themselves are surplus to requirements – which of course they are. Among other things, these walking and talking impediments to prosperity and economic progress continually assert that nations can somehow be made richer if only they devalue their currencies. This is typical Keynesian logic: You can get richer by becoming poorer!
Photo credit: Daniel Rohr
The Unwanted Speech
Yesterday, we began our high-minded graduation speech to the Class of 2015.
We explained how the young graduates were not only the most heavily indebted in history, but also the least likely to be able to pay their debts. Median wages have been going down since these graduates were about five years old … So have economic growth rates.
Today, we continue the speech no one wants us to give …
A drone firing on cave dwellers in the Hindu Kush. It’s not making anyone safer, but it sure makes the US feared and hated in the region, especially as the “collateral damage” keeps piling up. Oh, and it’s part of the war racket, that is making a few people very, very rich. But not you. You’re paying for it.
Photo credit: Charles McCain
Dull, Embarrassing, Earnest and Trivial
A long, long time ago
On graduation day
You handed me your book
I signed this way
“Roses are red, my love
Violets are blue
Sugar is sweet, my love
And boy are we screwed”
– With apologies to Bobby Vinton
Image credit: Merlon Drâs
Why Market Participants Liked the Payrolls Report
Some people have wondered why the stock market reacted with such a big rally to last Friday’s payrolls data. After all, the report wasn’t much to write home about, especially if one ponders the details. In addition, the already weak March payrolls data were revised lower to an even worse figure.
However, the report certainly did one thing: it kept the “Goldilocks illusion” alive. While jobs data are a lagging economic indicator and would likely be completely ignored in an unhampered free market (if anyone even took the trouble to collect them, that is), they are regarded as decisive for Fed policy. Few things illustrate more vividly that the central planners are driving forward with their eyes firmly fixed on the rear-view mirror.
Say hello to Goldilocks
Image by Mario Rodrigues
I attended a panel discussion yesterday on the problems start-ups have in raising capital caused by securities regulation. Start-ups have to hire a lawyer before they raise the first dollar of capital. It’s a real catch-22.
Entrepreneurs are often surprised to find that raising capital means selling securities. They cannot legally sell securities to just anyone. They are restricted to Accredited Investors (basically people with high income or high net worth). Most young entrepreneurs don’t have a rolodex full of such investors. There are other restrictions, for example, they can’t hire someone to help them raise capital unless he has a license to sell securities.
Image credit: Simon & Schuster
More Articles of Interest:
- Cameron's New Thought Police
- Switzerland is the Ultimate Safe Haven for Liberty and Wealth
- Economist on Gold – A Dissection
- Ominous Stock Market Charts
- A Vision of Monetary Hell …
- “Hello Dictator” - Leader of Socialist Superstate Project Meets Magyar Renegade
- Is the Fed Going to Raise Mortgage Rates?
- Are You Guilty of Crimes Against the Young?
- The “Junkie Economy”
- Why Bonds Are No Longer a “Safe Haven”