Time to end the Fed

Thanks to lewrockwell.com for publishing this short but excellent article on how the Federal Reserve has destroyed the purchasing power of the U.S. dollar. Isn't great to know that the rest of your life you'll be working for dollars that are worth only four cents or less. It's time to eliminate the Federal Reserve (peacefully, that is) and institute free banking led by entrepreneurs (who would have us on the gold standard).

Rogers understands Ben Bernanke

Jim Rogers, the billionaire investor who left the empire, tells us here that the chairman of the Federal Reserve, Ben Bernanke, is clueless and doesn't understand economics. Rogers is right - all Bernanke knows how to do is print money out of thin air. The consequences? We'll see, but if I were you, I'd be buying gold and silver every month.

Great article from mises.org

The government and the clueless pundits on CNN, MSNBC, and Fox won't explain to you why the dollar is now worth only four cents. In fact, they don't even want you to know that. In a step-by-step process, the government destroyed the value of our dollar since they created the Federal Reserve in 1913. Now nothing backs our fiat currency.

This great article explains a lot of what the government did to us. Thanks to the Mises Institute for another great article on economics.

End the Fed

The inflating central bank of the U.S., the Federal Reserve, has got to go. As you can read in this article by Eric Vorhees, the Fed has destroyed the value of our dollar. Time to read Texas Congressman Ron Paul's book, End the Fed. Thanks to lewrockwell.com for posting Eric's article.

Austrian Business Cycle Theory

Unlike the cranky economics of the Keynesian school, which is taught in government schools, the Austrian school is key to understanding what happens in the economy. This school of thought gets it and predicted the current downturn.

The core of Austrian economics is the Austrian Business Cycle Theory, briefly explained in this article. By studying this theory, people can come to an understanding of the booms and busts of the economy; they will also realize we must get rid of the inflating central bank (the Fed).

Jefferson knew best

Thomas Jefferson, one of the very few who were actually good at being president, knew the dangers of war and of centralized banking. He reduced the size of the army and the navy, and said "we must stay out of Europe, they are nations of eternal war."

He was also suspicious of the power of judges and the power of central banking. If he could see the Fed today, he'd have a stroke. He said:

"I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a monied aristocracy that has set the government at defiance. The issuing power (of money) should be taken away from the banks and restored to the people to whom it properly belongs."

Inflationary Time Bomb

Kyle Bass understands economics, and he knows the history of what happens when government ratchets up the printing of money. He says we all need to protect ourselves:

“If you are following stocks or bonds (like in 1923 Germany or Argentina in 2001), you are likely to get rope-a-doped because you are not watching the government steal your hard-earned savings with their printing presses,” Bass wrote. “It is time to defend yourselves from this insidious crime against the financially prudent.”

You can read the full article here. Are you prepared?

Keynesian economics is dead

Well, at least it should be. But the government rolls it out, year after year, teaching it in the schools and using it to "guide" us to prosperity. Well, we know how that's turned out. As Hans Herman-Hoppe stated in his The Misesian Case Against Keynes:

I will show that Keynes's new economics, like that "underworld" tradition, is nothing but a tissue of logical falsehoods reached by means of obscure jargon, shifting definitions, and logical inconsistencies intended to establish a statist, anti-free-market economic system.

Why is the U.S. economy in bad shape? Because of the Federal Reserve, its fiat currency, and devotion to Keynesian economics. When, and only when, we are able to free ourselves from paper money backed by nothing and the cranky economics of Keynes will we be able to return to true prosperity.

Greenspan exposed

Another great article from the Mises Institute, this one exposing the former Fed boss Alan Greenspan. Unfortunately for America, Greenspan tried to nullify the fundamental laws of economics. Once of his worst sins was printing money, and printing money, and printing money. The "Great Printer" printed so much in the 90's that the NASDAQ went up ten times in ten years! That's not really supposed to happen, and it all began to unravel in 2000.

So when your friends tell you it was the "free market" that caused all of our problems, just have them go to mises.org or here to find out the truth.

More evidence

Even though the government hasn't officially declared our current economic crisis a recession, we all know it's here. Car dealers know for sure, and he's an excerpt from an article on cnn.com regarding a car dealership in Florida:

Mr. Thomas has stopped ordering new vehicles, and he is relentlessly cutting costs, including his own salary. He is slashing medical benefits and matching funds for the retirement accounts of his remaining employees. He has stopped giving free oil changes and tires to charities, stopped offering coffee to customers and even canceled janitorial services for the bathrooms.

Sounds like the contraction phase of the business cycle. Government grows the money supply leading to easy credit, malinvestment occurs, we reach a peak (consumers are tapped), and then the pain begins, as you can see above.

More government help - please no!

Governments around the world are trying to figure out how to "save" their economies. They all vow to do something, and usually use the term "stimulus." So, they want to stimulate their economies. Unfortunately for them, that is impossible. Only entrepreneurs, who invest capital to start businesses and employ millions while providing the goods and services we want and need, can "stimulate" the economy. Since governments don't make bicycles, candles, pizza slices, pens, shirts, cars, and the billions of other items we desire, they cannot "stimulate" their economies. They can only get out of the way, and leave businesses alone.

The loons who created this mess (by allowing their central banks to inflate) are meeting to discuss the problem. The problem is, they are prescribing the same medicine - the wrong medicine. Get out of the way, stop taxing and regulating, eliminate your central bank, and stop printing fiat currency. Then, and only then, will economies flourish. They won't do this, of course, so we're in for a decades-long global recession. Mark my words.

Beware the spin doctors and the ignorant!

The pundits on TV (Dobbs, Beck, Hannity, Colmes, O'Reilly, etc.) and the politicans and bureaucrats are spinning the story and telling us that "free market capitalism" caused our current financial crisis.

Nothing could be further from the truth. The government and its cranky quasi-governmental agencies, like the Fed, Fannie, and Freddie, caused the crisis. But of course, they are never wrong. Now they are spinning the story, not only because they are ignorant of Austrian economics, but because they are constantly seeking legitimacy and power.

As you can read here in this article by a great economist, George Reisman, it's not the market that caused the problem. It's the government. Thanks to mises.org for publishing yet another great article that cuts through the crap.

Mises knew it a long time ago

The greatest economist of the 20th century, Ludwig von Mises, wrote one of his many great works back in 1934. The title: The Theory of Money and Credit. This book is especially important now because of the devastation of American wealth caused by the inflating central bank, the Federal Reserve. An excerpt:

"Native inflationism demands an increase in the quantity of money without suspecting that this will diminish the purchasing power of money. It wants more money because in its eyes the mere abundance of money is wealth. Fiat money! Let the state "create" money, and make the poor rich, and free them from the bonds of the capitalists! How wrong to forgo it simply because this would run counter to the interests of the rich! How wicked of the economists to assert that it is not within the power of the state to create wealth by means of the printing press! - You statesmen want to build railways and complain about the low state of the exchequer? Well, then, do not beg loans from the capitalists and anxiously calculate whether your railways will bring in enough to enable you to pay interest and amortization on your debt. Create money, and help yourselves."

Mises knew back then that the creation of money backed by nothing leads to disaster. As we watch the economy collapse this year and next, we can only hope that Mises' works catch on so we can finally abandon Keynesianism, that economic crap they teach in public schools.

What happened?

The root cause of the current crisis is central banking (the Federal Reserve) and its fiat money system. Whenever any central bank prints money out of thin air, the chickens ultimately come home to roost. Only a few of the "experts" you see on CNN, Fox, etc. actually understand this. So all the meaningless talk is just that, meaningless, unless they discuss the Fed and its policies.

Only the Austrians knew what was coming, and they predicted it years ago. By studying Austrian economics, you'll not only know more economics than almost the entire U.S. population, but you'll also be better able to invest your money and avoid catastrophe.

Simply invest $6.00 and buy The Case Against the Fed by Murray Rothbard. Then you'll also realize that neither Obama nor McCain knows what's going on or how to fix it.

The Great Rip-Off of 2008

The U.S. government has done it to us again. It's been downhill since that dark year of 1913 when we got the income tax, the Fed, and the direct election of senators, but now they've really done it to us.

This bailout will be a complete, unmitigated disaster. The ultimate cost will be borne by us, the taxpayers, and Wall Street and the economy will never be as free as it once was.

Plan your exit strategy now, which may include learning a second language, obtaining dual cititzenship, and purchasing real money (gold and silver).

Late 1890's redux

I don't know who said it, but it's a great quote: "The only thing we learn from history is that we don't learn from history." Well, we're not learning, and the ones really not learning are the fascists in Washington.

In the late 1890's, after the Panic of 1893 was over, big business and a new group of "progressives" kicked off what's called the Progressive Era. These groups called for more government regulation because, they claimed, that free- market or laissez-faire capitalism failed. They spun the whole story, making it sound good to an uniformed public that the government was good and that they were here to help.

Now the powers that be (the government and the mainstream media) are spinning the whole story again, and once again are blaming capitalism. As you can read in this article (thanks to prudentbear.com), politicians and pundits alike say that de-regulation is the root cause of our economic woes. Actually, it's the Federal Reserve's reckless behavior of printing almost worthless dollars that is the root cause.

Don't buy into the spin! Instead, read Murray Rothbard's great, short book, The Case Against the Fed. Find out the truth, and don't let the government dupe us once more. Entrepreneurs create wealth; the government, through taxation and regulation, destroys wealth. So let's say no to more government intervention in the economy.

Just click on the title of Murray's book and you can purchase it for only $7.00. And be careful of Wikipedia's entries on the Progressive Era and the Panic of 1893. They may have been written by statists who also blame the free market.

Turn off your TV!

Turn off your television and no longer watch the loons in Washington, D.C. or the crazy financial pundits talk about how they are going to fix all of our financial problems. As you can see by this article, a major U.S. bank has gone under. This is serious stuff. Lehman Brothers, a Wall Street investment bank, is also looking quite shaky. Remember, Bear Stearns became insolvent and went away a few months ago. May it rest in peace.

Mark my words: the government will step in and make things worse. They'll spin it and make it sound good, and they'll even blame the free market and laissez-faire capitalism. They'll say we're here to save the day, and only the Fed, acting in concert with Congress and the Treasury, can fix our problems.

Nothing is further from the truth! There will be more regulation and oversight, and things will get worse. The rest of this year and the next will be brutal. The market will get hit, more banks will fail, unemployment will rise, and the foreclosures will continue.

Start saving your weak dollars, which are only worth four cents. Don't buy that new car or big screen TV. You might need the money to get out of Dodge.

Fannie Mae took the Fed's bait

According to this article, the Federal National Mortgage Association, nicknamed "Fannie Mae," is in some trouble. But it's their own fault. As Alan Greenspan, former Fed Chairman, and his successor, "Helicopter" Ben Bernanke, the current Fed Chairman, inflated away the dollar by pumping excess liquidity into the market for years and years, Fannie Mae took the bait and got involved in the whole game. Instead of being more prudent, Fannie Mae was just one cog in the whole housing bubble.

What kind of trouble is this quasi-governmental agency in? Well, there may be substantial problems, since the article points out that as of December it had assets of $35.8 billion. Now? $12.2 billion. Ouch.

Refill the punch bowl!

Every time the market tries to take the punch bowl away and end the party, the Fed steps in and refills it. The new punch is simply more "soma" to keep Wall Street happy. Wall Street and the big banks are hooked on the drug, and they want the party to be never ending. Today's action by the Fed, and the subsequent rise in the markets, spells ultimate doom and more pain later. The more the Fed prolongs the party, the greater the ultimate pain will be. There will be a reckoning.

As you recall, soma was the drug most people were hooked on in Aldous Huxley's dystopian novel about the future, Brave New World.

Inflation is back with a vengeance

As you have observed yourself while shopping, it seems like the price of everything is going up, especially food and gasoline. Here's an interesting article that states it could get much worse. If only the Fed would stop the printing presses and adopt a sound monetary policy. Only if . . .