“As the nation’s central bank, the Federal Reserve derives its authority from the Congress of the United States. It is considered an independent central bank because its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government, it does not receive funding …
There’s plenty of gushing about the Janet Yellen appointment as Federal Reserve Chairman. Yale economist Robert Shiller says she’s “a real mensch.” Greg Mankiw from Harvard says President Obama made a great decision in choosing her. “Reports of Janet Yellen’s forthcoming nomination will be greeted well by market agents,” says David Kotok. “It should be.” …
The voting machine that is the market deemed an ounce of gold to be worth $1,600 a few days ago and then, whoops, two days later, that same market, the collection of rational minds that trade in the metal, valued that same ounce to be worth less than $1,400. Keep in mind: These prices are …
In 2008, the American dream of homeownership turned into an incredible nightmare for millions. The government had been subsidizing this stuff for nearly a century, and it all turned to dust. As is typical, government has swung back the other way, seeking to discourage reckless borrowing on houses and to suppress mortgage rackets. This time, …
The great battle since 2008 has pitted the ghosts of F.A. Hayek against John Maynard Keynes. Team Keynes dictated the policies we know too well: more government spending, flood the economy with money, prevent liquidation. This team predicted a recovery that still hasn’t come. Meanwhile, Team Hayek has had a different set of predictions. This …
Memories are short, and 2008 is ancient history. Consumers can’t suppress their urge to consume. Lenders can’t suppress their urge to lend. We’ve learned nothing from the last boom-bust. We are repeating it, piling error upon error. “People will spend more of their equity,” Chris Christopher, an economist at IHS Global Insight in Lexington, Mass., …