One of my major theses is that in times of too much debt and too little growth, countries resort first to currency wars and then to trade wars and then finally to shooting wars to steal growth from trading partners and geopolitical rivals. The problem with currency wars is that all advantage is temporary and […]
“Central banks are overwhelmingly more concerned about deflation than about inflation. It is precisely the deflationary fear — the fear of the liquidity trap — that will drive central banks to be extremely loose with their monetary policies. Central banks are afraid of the fall in monetary velocity, and because of this, they will continue to flood the world with money until they are convinced velocity will rise.”
The problem is that this prevents the poor and middle class from enjoying lower prices for the products and services they buy; the rich don’t care if prices rise as they can easily afford higher prices for consumption goods. The rich will also benefit by the rise in the price of the huge amount of […]
There is no means of avoiding a final collapse of a boom brought about by credit expansion.
The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion or later as a final and total catastrophe of the currency system involved. Ludwig von Mises