Classical Economics in a Quantum World
The financial media is abuzz with news of a strong dollar vs a weak dollar. Which way will the dollar go? Traders churn trillions in currency and interest rate derivatives every market day betting on the outcome of this question. …
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The PhD Scourge Danielle DiMartino Booth has written a timely book about the Fed, Fed Up, An Insider’s Take on Why the Federal Reserve is Bad for America. Fed Up deconstructs the Fed from the lofty pedestal upon which conventional wisdom has…
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“As long as excess reserves persist, with IOR, in amounts necessary to facilitate Federal Reserve control of the price of interest, the trend for the minimum price of gold is determinative by its average price over the duration of debt.”…
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The market is still applying the Fed’s old operating rules when pricing gold. Funds rate hikes in the era of massive excess reserves and a bloated Fed balance sheet offer buying opportunities in gold. The general misconception is that funds…
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Financial media, pundits, economists, government officials, and pretty much everyone else continue to categorize rate hikes as if the Fed were still conducting policy under normalized, traditional operating procedures. Bernanke tore asunder normalized Fed operating procedures after the 2008 financial…
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Jude Wanniski was a journalist, WSJ editorial page writer, author, historian, Polyconomics founder, and brilliant revivalist of Classical economics. He passed in 2005 but left a massive compilation of writings that span decades. Jude was a prolific writer. During his Polyconomics…
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Understanding Gold 8 There’s a very odd thing about a gold standard. Hardly anyone understands it, least of all economists. It’s not like there is no record of the previous three centuries. From the late 1600s until the 1970s, major…
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Understanding Gold 7 The Ratio of Two Ratios The unique properties of gold combined with how the Fed operates determines the dollar price of gold (POG). Similarly, other central banks’ monetary management determines the POG in their currency. Because gold…
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George Gilder has authored a prescient piece that succinctly sums up the challenges that the Trump administration faces in righting the global economic system. Titled Trump Can Succeed On Trade By Ending Global Currency Manipulation, Gilder gives fair warning that the…
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Update: I learned on 1/5/2017 that the Wilbur Ross tweet referenced below was from a fake account. This is good news if the Trump administration is in fact not advocating a weak dollar, despite contrary suggestion from the Nikkei Asian…
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