The Gold Standard

Thanks to the Mises Institute for posting another great article by Robert Murphy. Read his concise defense of the gold standard here. Note the chart regarding consumer prices. See how it really starts to go up at the beginning of the 1970's - that's when President Richard Nixon put the final nail in the coffin when he closed the international gold window.

By the way, I own and highly recommend Murphy's book, The Politically Incorrect Guide to Capitalism.

Minta doesn't get it

Minta Garcia, a bus driver, and her husband, a construction worker, don't understand economics or finances. You see, Minta and her husband bought a house a few years ago in suburban Washington for $800,000. Somehow, they couldn't figure out that a bus driver and a construction worker can't afford a house approaching $1 million.

She hasn't asked for help, but says she is waiting to see if she qualifies for help from you and I (through the confiscation of our taxes by the federal government). Sorry, Minta, time to move into an apartment and save up for a down payment on a house that a bus driver and construction worker can afford. I'm sure you wouldn't stick a gun in my face to steal my wallet. Then why ask the federal government to do it for you?

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?

Geithner refuses to answer question

In front of the House Ways and Means Committee today, new Treasury Secretary Geithner refused to answer a simple question: "Where's the money for the stimulus and other programs coming from?" When pushed to answer, he once again rolled out his tired rhetoric that what he's doing is necessary. He never answered the question on where the money's coming from.

He didn't answer because we know where it's coming from, and we know it's bad: the money will be printed. More fiat currency. Another great increase in the money supply, which is how we got into this mess.

Unfortunately, the cowardly congressman who asked the question allowed himself to be distracted, and another coward took over and asked some irrelevant questions. A dog and pony show that means nothing.

Have you been buying your gold? Is your exit strategy in place?

Why you should read "Meltdown"

Iceland went under, Austria's banks are about to collapse, and England is teetering. The news from China is just as bleak: 70,000 factories have closed in the last few years, and the unemployed from those closings has hit 20 million. Why?

The root cause is that every country now, following our foolish lead, has an inflating central bank. The favorite tool of these banks: fiat currency. Fiat means "of nothing." So all of this supposed "money" is simply paper backed by nothing.

Thomas Woods, one of the best historian/economists in the country, has come out with a great, relatively short book that explains it all. Meltdown: A Free Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse.

If you read it, you will know more than over 95% of the people in the U.S., and then you can figure out and implement a plan to save your investments and yourself. A small price to pay in these turbulent and scary financial times.

Socialized medicine in Japan fails again

Socialism doesn't work because economic calulation is impossible because of the lack of prices. Socializing goods and services leads to long lines, shortages, higher taxes, less quality, and ultimately, rationing.

As you can read here in this article, the socialized hospitals in Japan killed a man because they wouldn't accept him. He was turned down by 14 hospitals! Gee, I can't wait until Obama gives us "change we can believe in" and implements full-blown socialized medicine, I mean "universal health care," here in the America. Not!

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.