monetary policy

Author: Mark Thornton, Mises.org We are constantly told that unprecedented levels of money printing by the Federal Reserve and other central banks are necessary to stimulate the economy, create jobs, and generate economic growth. The truth is, this is a scheme to covertly steal purchasing power…

By Jeff Deist, Mises.org Bloomberg Terminal, the financial software used by countless analysts and traders around the world, has a problem: its system can’t price bonds that use negative interest rates. The programmers never even considered such a situation possible, so they didn’t …

Author: Hristiyan Atanasov About a month ago, The Wall Street Journal published an article explaining the intentions of the Eurosceptic parts of the Italian political sector to issue mini-bonds (mini-BOT from Buoni Ordinari del Tesoro – i.e. lit. “small ordinary treasury bonds”) with a face value of €50[1], according to other sources €100. The idea of …

The common European currency is not particularly successful in its task of bringing the peoples of the Old Continent closer together – this is easily seen in the division of Europe into one or two speeds, the groups of countries that comply with and do not comply with the Maastricht criteria, and of course the severe tension between center and periphery, north and south, expressed most clearly...

Author: Frank Hollenbeck, Mises.org The gap between the rich and the poor continues to widen. In 1975, the top 1% of the U.S. population owned 8% of the economic wealth. Today, they own more than 20%. This is a striking change from the 1950s and 1960s, when the top 1% owned just over 10%. A study by Emmanuel Saez found that …

In the midst of Brexit, about which I[i] wrote on June 22, 2016[ii] and where nothing unexpected has happened since the then-forecast, and in the midst of domestically important political topics, the approaching expected actions for Bulgaria’s entry into the “eurozone waiting room” and membership in the zone itself were completely forgotten. If we exclude the statements of …

Author: Kristiyan Korelov It has been more than a decade since one of the largest stock market panics in the United States occurred. Credit markets had completely stopped functioning (Gorton, 2008), and the situation was very similar to that of the panic of 1907, when banks were in massive need of liquidity and a huge part of …

Wherever we turn, deflation is always portrayed negatively, and every author is quick to present the fight against deflation as the absolute minimum for economic competence. There are two definitions of deflation: one is a “fall in the price level,” as measured by the so-called Consumer Price Index; a definition common to mainstream economists. …

Author: Frank Shostak, Mises.org According to many mainstream economists, the lack of a strong correlation between money supply growth and growth in various price indices casts doubt on the theory that increases in the money supply are the main source of inflation. It is also argued that before 1990 there was a positive correlation between …

Emerging Market Pain May Be a Sign of Future U.S. Trouble Emerging markets are on fire. In the past week, Turkey’s currency crisis has been joined by similar financial conflagrations in Argentina and Indonesia. The central bank of the Gauchos raised its key interest rate to 60% (the world’s highest) from 45%, after …