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Freedom of Contract and Property Rights
Author: Wanjiru Njoya
Categories: 6b.) Mises.org
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The classical liberal defense of contractual freedom is derived from the principle of individual autonomy. Freedom of contract entails the right to enter into or exit from contracts at will. As Richard Epstein argues in his defense of the contract at will:The first way to argue for the contract at will is to insist upon the importance of freedom of contract as an end in itself. Freedom of contract is an aspect of individual liberty, every bit as much as freedom of speech, or freedom in the selection of marriage partners or in the adoption of religious beliefs or affiliations (p. 953).Utilitarian classical liberals, like Epstein himself, who agree with him on the value of individual liberty therefore defend the widest possible scope for contractual freedom. They would only accept limits on
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Central Banks Are Wrong about Rate Cuts
Author: Daniel Lacalle
Categories: 6b.) Mises.org
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When we talk about monetary policy, people do not understand the importance of interest rates reflecting the reality of inflation and risk. Interest rates are the price of risk and manipulating them down leads to bubbles that end in financial crises, while imposing too high rates can penalize the economy. Ideally, interest rates would flow freely and there would be no central bank to fix them.A price signal as important as interest rates or the amount of money would prevent the creation of bubbles and, above all, the disproportionate accumulation of risk. The risk of fixing rates too high does not exist when central banks impose reference rates, as they will always make it easier for state borrowing—artificial currency creation—in the most convenient—what they call “no distortions”—and
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Week Ahead: FOMC, US Jobs, EMU Inflation, JPY Pressure
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Author: Marc Chandler
Categories: 4.) Marc to Market, 4) FX Trends
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The backing up of US rates did not lift the dollar broadly as it appeared to have done previously. The dollar-bloc currencies, led by the Australian dollar, and sterling advanced last week, while the Swiss franc and Japanese yen were unable to find traction. The Bank of Japan had an opportunity to have protested the yen's weakness more adamantly but did not do so. Recognizing the role of interest rate differentials as an important driver, the Ministry of Finance threatens action but seems reluctant to intervene. Still, the market continues to probe for the official pain threshold. This year, the greenback has generally weakened in the run-up to the employment data and recovered afterward. It has trended lower over the last couple of weeks and that correction may be over.Still, after
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The Great Chocolate Crisis
Author: Mark Thornton
Categories: 6b.) Mises.org
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What is the Mises Institute?
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The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard. Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.
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Economic Education Has Become Economic Disinformation
Author: Per Bylund
Categories: 6b.) Mises.org
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Modern economics is in terrible shape. But economics education appears to be worse still. This becomes clear when discussing basic economics with those who have taken courses in the field. Rather than doing away with economic misunderstandings and outright nonsense, economics education apparently provides students with a pseudoscientific rationale for their illusions.Two such ideas are annoyingly common. One is the view that markets can only work under perfect conditions. The other is that economic growth requires that profits tend toward zero. Yes, they are ridiculous, but they are so commonly held (and believed so strongly) that they suggest a fundamental failure of economics education. Whether or not they are explicitly taught, it is easy to see how an economics education that focuses
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What’s Wrong With Biden’s Housing Tax Credit?
Author: Laurence M. Vance
Categories: 6b.) Mises.org
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In his state of the union address, President Biden expressed his desire for a $400 a month tax credit over two years for first time home buyers. I have argued for years that tax credits are a good thing, and still maintain that they are a good thing. Yet, I am leery of Biden’s tax-credit proposal.Biden’s proposal was one of several relating to housing:I know the cost of housing is so important to you.If inflation keeps coming down mortgage rates will come down as well.But I’m not waiting.I want to provide an annual tax credit that will give Americans $400 a month for the next two years as mortgage rates come down to put toward their mortgage when they buy a first home or trade up for a little more space.My Administration is also eliminating title insurance fees for federally backed
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Did the MMT Camp Correctly Predict the Post-Covid Economy?
Author: Robert P. Murphy, Jonathan Newman
Categories: 6b.) Mises.org
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What is the Mises Institute?
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The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard. Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.
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Word of the Day: Performative
Author: Karen Kwiatkowski
Categories: 6b.) Mises.org
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The western media are, above all, phraseologists. Managing massive vertically integrated “states” requires the controlled and targeted use of repetitive government approved language, propaganda, jingoism, repeated phrases to channel thought and energy.We’ve seen a lot of “performative” progressivism in recent years – Black Lives Matter and reparations from the Civil War, incessant genderology above the fold, Trump Derangement Syndrome, tomato soup weilding environmental activism, and DEI departments in every company, corporate board, and investment portfolio.Each of these has consumed and wasted the mental, spiritual, and physical energy of millions of people. Thankfully all are fading in their usefulness to the state. Yet these performative movements were handmaid to the exercise in
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Help Us Publish These Three New Books
Author: Mises Institute
Categories: 6b.) Mises.org
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Please consider helping us publish these three new books: The World at War, Full Reserve Banking vs. Real Bills Doctrine, and Austrian Business Cycle Theory: an Introduction. The World at Warby Ralph Raicoedited by Edward FullerTo understand war, you also have to understand economics. Ralph Raico’s lecture “The World at War” is a masterpiece. Recorded in 1983, it remains perhaps the best introduction to the classical-liberal interpretation of the two world wars of the twentieth century. Raico touched on many of the topics he discussed in this lecture in his other writings, but he never wove them all together as concisely as he does here. Raico’s interpretation and insights into the causes of perpetual war are much needed today in light of the war-hungry, interventionist politicians that
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Low Time Preference Leads to Civilization
Author: Soham Patil
Categories: 6b.) Mises.org
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Time preference refers to the preference of satisfaction in the present as compared to a future time. A person who heavily prefers current consumption to future consumption has a high time preference as he places a heavy premium upon satisfaction as soon as possible. By contrast, a person who does not place a heavy premium upon instant satisfaction has a low time preference. People with low time preferences are more likely to save and invest their money for greater future rewards. This tendency to delay consumption for the sake of increased production leads to the accumulation of wealth that propels the process of civilization.In Democracy: The God That Failed, Hans-Hermann Hoppe states:However, no matter what a person’s original time-preference rate or what the original distribution of
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