Saturday, May 26, 2018

Yuri Maltsev on Socialism's Resurgence

Jeff Deist writes:
Listen to Yuri Maltsev!
He understands the enduring fetish for socialism among western elites. This is a fun conversation about the Che Guevara T-shirt types and the people creating a new class of them among millennials.
This is really great stuff. Don't miss it. Maltsev is probably the most underrated living economist.



-RW  

Why People in Illinois Should Have an Extra Drink This Holiday Weekend



-RW  

Friday, May 25, 2018

New Federal Reserve Board Chairman Sends Message to Trump: Don't Mess With Me


Federal Reserve Chairman Jerome Powell on Friday issued his sternest warning yet that politicians should not interfere with interest-rate policy, in what appeared to be a  message to President Donald Trump, reports Politico.

In a speech in Sweden, Powell indirectly referred to a previous Fed chairman, Arthur Burns, who was pressured by President Richard Nixon in the lead-up to the 1972 presidential election to keep interest rates low. (See: Nixon used Alan Greenspan to get into the head of Burns.)

“For a quarter century, inflation has been low and inflation expectations anchored,” said Powell, a Trump appointee. “We must not forget the lessons of the past, when a lack of central bank independence led to episodes of runaway inflation and subsequent economic contractions.”

This is an interesting warning from Powell. Why is he doing it now?

Did Powell issue this warning because someone close to Trump has attempted to influence him?

Remember, in his recent book, the well connected Henry Kaufman wrote:
Perhaps presidential preferences [about Fed policy] are conveyed through operatives; certainly they are no longer public.

-RW  

Elon Musk, Crony Capitalist



By Lee Enochs

Elon Musk is at it again. The billionaire tech magnate continues to get richer and richer on the American taxpayer’s dime, highlighting the need to do as Murray Rothbard advised of reassessing the “partnership” of government and business.
At first glance, Elon Musk appears to be a quintessential capitalist success story. The South African born-American technology magnet, lead designer of SpaceX, and product architect of Tesla, Inc. is now ranked 25th on Forbes Magazine’s list of the World’s Most Powerful People, and as of February 2018, Forbes has Musk listed as the 53 rd richest person in the world.
One might conclude that Musk’s staggering wealth was produced via faithful adherence to the timeless and inexorable principles of laissez-faire capitalism, where personal wealth is accrued through the federal government leaving commerce alone and staying outside the affairs of private industry. However, this perception of Elon Musk’s economic independence from government interventionism is largely a fabrication and carefully manufactured distortion since

It's Getting Insane: Trump's Top Trade Adviser Compares Treasury Secretary to Nazi Appeaser

Peter Navarro (left) and treasury Secretay Mnuchin
The tension between Donald Trump advisers Treasury Secretary Steve Mnuchin and Trade Aviser Peter Navarro is at an all-time high, reports The Daily Beast.

Mnuchin, correctly, believes Navarro to be a crank and a recurring nuisance, and Navarro is accusing the Treasury Secretary of trade capitulation akin to Nazi appeasement.

Navarro is a crazed nationalist, anti-trade protectionist hardline, especially when it comes to trade with China, and Mnuchin is part of the free-trade-lite camp.

 Trump, also from the dumb anti-trade camp, has dubbed Navarro “my Peter.”

Navarro has—according to multiple sources who spoke to The Beast on the condition of anonymity—privately nicknamed Mnuchin “Neville Chamberlain” (in reference to the Conservative British prime minister whose foreign policy position was, rightly or wrongly, seen as appeasement toward Nazi Germany and Adolf Hitler) and likened the economic threat from China to that of fascist dictator Hitler.

According to The Beast,  a senior White House official described the dynamic between the two as a “Cold War that became hot,” especially during the China visit....Navarro has privately fingered Mnuchin and his team—including Tony Sayegh, the Treasury Department’s assistant secretary for public affairs—as the ones orchestrating an aggressive leak and smear campaign against him in recent weeks.

-RW  

Oxfam Is At It Again:This Time the Distortion Machine is in Overdrive



-RW  

Thursday, May 24, 2018

Creating The "Height-Based" Balance of Payments



By Robert Higgs

Let us define the set of all human beings whose height is greater than 170 cm and less than 180 cm. Call this set A. Now let us collect data on all the dealings between members of set A and members of set B, which consists of all human beings whose height is less than or greater than those in set A. What economic significance can we ascribe to the aggregate of monetary flows between members of set A and members of set B? Correct answer: none. This aggregation of persons who trade with persons in the complementary set has no economic meaning; the sets are arbitrary so far as economic understanding is concerned. People—individuals, firms and other organizations, and governments—trade in order to improve their economic condition. Whether they trade with shorter or taller people or with people within a certain height range or outside this range has nothing to do with economics or human well-being. To draw up a balance of inter-set payments for set A and set B, or any given subset of B would serve no purpose. It would be a nonsensical exercise.


Now let us define the set of all human beings who

When Hyperinflation Mixes With Socialism



If only the masses understood the horrors of government money printing and socialism.



-RW  

BREAKING U.S. Justice Department Opens Criminal Probe Into Bitcoin Price Manipulation


The Justice Department has opened a criminal probe into whether traders are manipulating the price of Bitcoin and other digital currencies, reports Bloomberg.

The investigation is focused on illegal practices that can influence prices -- such as spoofing, or flooding the market with fake orders to trick other traders into buying or selling.

So much for Bitcoin being an anonymous trading vehicle. The DOJ is going to rip into the big players and look deep under the hood.

Bitcoin extended its Thursday declines after Bloomberg News reported the investigation, and was down 3 percent in the last 24 hours to $7,409 as of 9:32 a.m. London time. In late December 2017, Bitcoin traded as high as $19783.06.

Although I have been highly suspicious of Bitcoin, I did advise it as

Trump Wants New 25% Tariff on Imported Automobiles



The Trump administration is using national-security laws to consider imposing new tariffs on vehicle and auto-parts imports, the Commerce Department said Wednesday, according to the Wall Street Journal.

Trump is asking for new tariffs of as much as 25% on automobile imports and  has asked his team to investigate using a legal provision of the 1962 Trade Expansion Act to find whether tariffs or other restrictions are needed on imported cars, according to WSJ. It is the same legal justification the administration used to impose tariffs on steel and aluminum imports in March.

In a Twitter message on Wednesday, Trump said, “There will be big news coming soon for our great American Autoworkers. After many decades of losing your jobs to other countries, you have waited long enough!”

But it won't be so good for American buyers of foreign cars and for those who buy products once made by those workers in America who will now be shifted to automobile manufacturing.

In other words, such a tariff will shrink the economy in ways easily seen and not so easily seen.

-RW  

Should Foreign Language Requirements be Abolished in US Schools?



Alex Tabarrok posts this podcast exchange between Bryan Caplan and Robert Wilbin:
Bryan Caplan: In the U.S. I’ve heard so many times – I learned Latin and it really improved my score on the SAT because of all the Latin roots of the English vocabulary words. How about you learn some English vocabulary words, wouldn’t that be a little easier?
Robert Wiblin: I’m just… I’m pulling out my hair here.
Bryan Caplan: Well if you wanna pull out your hair a little bit more. Out of all my ultra moderate reforms that I suggested, the one that I stand behind more strongly than any other is abolishing foreign language requirements in the United States. Because there, we’ve got a bunch of facts, which are: hardly any jobs use foreign languages, it takes a lot of time to get any good. And furthermore, in this book I’m able to go and snap together a bunch of pieces of data to show that virtually zero Americans claim to… even claim to speak a foreign language very well in school.
So I say, look, even if it did have these big payoffs, the system is just a waste of time, and people spend years doing it for nothing. And even here, I just run against a brick wall and people say, well in that case we should just improve the teaching of the foreign language.
Well, how about you do that and then get back to me, but continuing to fund the thing that we have, this is garbage!
And again, Washington state from what I understand, now allows kids to use a computer language in place of foreign language. Like, why not do that? Then it’s like, “No, no we need to do both.” People don’t have an unlimited amount of time, and shouldn’t teenagers be able to have a frigging childhood! Like how much of their childhood do you want to destroy with jumping through these stupid hoops?

Caplan is correct here but there is an additional reason that it makes no sense to learn a second language for most English language speakers. English is the global language of business. Nearly every businessman doing international business is going to speak English. It is a waste of time to learn another language for most English speaking businessmen since most business counterparts will be able to converse in English. And further, what if you study French and end up doing business with Russians or Chinese?

And Engish is not only the commanding language when it comes to business, as I have pointed out previously, English is the international language of love.

-Robert Wenzel