Monday, August 31, 2015

"Dr. Evil" (?) Buys Times Square Billboard Bashing $15 Minimum Wage

On Monday, a billboard went up over NYC's Times Square  ridiculing the call for a $15-an-hour minimum wage for fast-food workers. The billboard depicts a doofy good-for-nothing millenial shrugging his way toward a $30,000-a-year salary, 

According to the Gothamist, the $100,000 ad was paid for by the Employment Policies Institute, an arm of Washington, DC corporate operative Rick Berman's PR organization.

Gothamist goes on:
Berman has garnered the moniker "Dr. Evil" from activists and CBS's 60 Minutes for his ad campaigns promoting high-fructose corn syrup, and advocating against indoor smoking bans, against tighter drunk-driving standards, and most recently, against raising the minimum wage in venues nationwide.
Being against raising the minimum wage is pro-work for black youth. Is this evil? Hey, black youth matter. I'll go even further. I am not only against raising the minimum wage, I am for abolishing it altogether.


BREAKING Ron Paul Responds to ISIS Video That Mentions Ron Paul on Gold

Here's the striking professionally produced ISIS video that is discussed by Dr. Paul and Daniel McAdams:


Reading on Kindle Will Now Be Taxed 8% in Japan

Amazon is sending out this notice:


Starting October 1, 2015 an 8% consumption tax will be applied to all ebooks sold to customers living in Japan. No action is required of you, but we are notifying you because you currently have one or more titles available through KDP that may be affected by this change.

One-time Adjustment for Existing KDP Titles
 Beginning October 1, list prices set for will be tax-inclusive, meaning that the 8% consumption tax will be included in the list price you give us. For example, if you set your list price at ¥1250, your new tax-inclusive list price would be ¥1250. Tax will be deducted from this price, and your royalties would be calculated on a resulting price of ¥1157. Keep in mind that you can change your price at any time subject to KDP’s Terms and Conditions....

Setting List Prices for
Starting October 1, to make it easier to set customer friendly list prices without having to calculate tax, authors will set list prices for the JP marketplace that include consumption tax. To accommodate this, the KDP pricing grid will be updated to accept tax-inclusive list prices. In the pricing page, authors will also see their suggested price without tax to help them understand how royalties will be calculated. For those authors who set their JP marketplace price automatically from their US list price, we will convert the US list price to local currency and that will be the list price that includes tax.

For more information about this change, visit our Help pages.

Best regards,
The Kindle Direct Publishing Team


Oil Up More Than 27% in Last 7 Days

Oil continues to soar. It is up more than 7% today, and up more that 27% over the last 7 days,

I wrote last week in the EPJ Daily Alert:
As I write, it is up just over 9.0%. I have written more than once that investors need to slowly accumulate gold, silver and oil because when the turnaround occurs it will be fast and furious. I often wonder if all readers understand what I mean by this, that prices will climb so fast that it will be difficult to get in without paying a much higher price.


Would a $15 Minimum Wage Have Helped Me? Absolutely Not.

By Mirta Gutierrez

Living in poverty in Argentina was not easy. Like many Argentinians trapped at the bottom of the economy, I was determined to make something of myself. I pursued a degree in accounting, but I quickly discovered that even with an education in my country, I was on a path to a dead end.

I knew that I needed to find my path elsewhere. With the help of family, I came to the United States — literally with the clothes on my back and an eye on making something better of my life.

After arriving in Washington, I learned at a job fair that an Angelo & Maxie’s restaurant was opening and hiring 300 people. I met the chef, and in very broken English I asked for an opportunity to prove myself. He agreed, reluctantly, to hire me as a dishwasher at $5.50 an hour. It was 2001. I watched everything, took mental notes and looked for every opportunity to try something new in the back of the house.

One day, I learned how to open clams. Before long I was preparing shrimp scampi and other dishes. On the job, I learned English — and everything about the kitchen and food prep. One day, I asked my boss about the business end of running a restaurant. He was stunned that I had a background in accounting. “Numbers are numbers,” I explained to him.

When Angelo & Maxie’s closed, I went to work at District ChopHouse near Verizon Center. In nine years, the general manager and executive chef taught me everything he knew about the restaurant business. Then, in a bittersweet moment, he told me, “It’s time for you to fly.”

I was hired as the executive sous chef at Rosa Mexicano, where I was able to apply the skills that I had learned over the years. Before long, restaurant executive Spike Mendelsohn asked for my help with kitchen management and bookkeeping for one of his restaurant concepts, Good Stuff Eatery, on Capitol Hill. Soon, I was recruited to be executive chef at Tortilla Coast, where I am today.

I am an immigrant who started at the bottom with nothing. I became an executive chef who understands the kitchen and an accountant who understands the numbers of running a business.

Read the rest here.

BAM Six Mistakes Paul Krugman Makes About Medicare's Finances

By Charles Blahous

My usual custom when writing about Medicare and Social Security finances is to simply present the relevant data instead of discussing others’ commentaries about the programs. After this year’s Medicare trustees’ report was released, however, a subsequent Paul Krugman column prompted a number of questions from his readers, suggesting it would be helpful to address Dr. Krugman’s specific assertions. 
The essence of Dr. Krugman’s column was to cite the latest Medicare report as evidence that “there never was an entitlements crisis.” Dr. Krugman’s view of the Medicare financing outlook differs with the trustees’ perspective as reflected in our joint message, which states, “Medicare still faces a substantial financial shortfall that will need to be addressed with further legislation.” The difference between these two perspectives derives in part from problems of incomplete information and analysis.
Problem #1: Conflating expectations with reality. Dr. Krugman’s piece points to long-term Medicare cost projections that now look less daunting than they did in 2009, and asserts that the entitlement cost problem is therefore “disappearing.” That characterization, however, is incorrect. Comparing to prior projections is in this context a distraction, irrelevant to whether Medicare is now on a stable financial course (it is not). 

WalMart Follows Up On Raising Its Minimum Wage By Cutting Employees Hours

Imagine my surprise.

After raising the minimum wage for its lowest compensated workers, Walmart is now cutting some workers’ hours to try to trim costs.

Store managers were recently told to cut back on hours to reduce costs, which has led to them eliminating hours from the schedule, telling workers to leave their shifts before they end, or having employees take longer lunches, Bloomberg News reports, according to Think Progress.

One anonymous Walmart worker near Houston told Bloomberg that her store had cut more than 200 hours a week by asking people to go home early. Another in Fort Worth was told that the store would cut 1,500 hours and said that employees who had been asked to stay late for extra work earlier in the week were told to take two-hour lunch breaks later on to make up for those hours.

In February, Walmart announced that it would raise its base pay to at least $9 an hour by April and $10 an hour by early next year, increasing wages for about 500,000 employees and spending more than $1 billion on the effort. At the time, the CEO said the company expected those changes to lower employee turnover and attract better talent, as well as to lead to better customer service that would boost sales.

But earlier this month, the company lowered its annual earnings forecast based in part on the higher cost of employee compensation.

The full story is here.


Islamic State Begins to Mint Gold Coins

ISIS claims it is now minting its own gold coins and other currency, according to a lengthy propaganda video released Saturday by the militant group, according to Vice News.

Entitled "The Rise of the Khilafah and the Return of the Gold Dinar," the documentary-style video features an English-speaking narrator who says the IS currency will be made up of gold, silver, and copper coins. The narrator calls gold the "only true measure of wealth."

In the video, which goes on for nearly an hour, the narrator explains that the new currency is aimed at strengthening the group's self-proclaimed caliphate and harming the US economy. It says the new currency will deliver a "second blow" to the US and its "capitalist financial system of enslavement" after 9/11.

ISIS first indicated it was going to print its own currency last November in an effort to escape the "satanic usury-based global economic system."


El Nino Could Set Off Next Great Surge in World Food Prices

Forecasters are predicting that El Nino, characterized by ocean warming in the equatorial Pacific, may be the strongest since records began in 1950, reports Bloomberg.. It has already brought torrential rains to parts of South America and dryness to Southeast Asia. The Philippines said on Thursday it plans to boost rice imports to prepare for potential shortages, while Rabobank International warned that wheat crops in Australia may be under threat.

Demand for food may also be larger than some analysts anticipate, leaving consumers vulnerable to shortfalls in production, Nomura analysts said in an e-mailed report last Thursday,  according to Bloomberg. Crop shortfalls and surging prices contributed to sparking riots and civil unrest in some countries over the past decade.

“It may not take much disruption in global food supply to trigger another price surge,” analysts including Rob Subbaraman and Michael Kurtz said in the report. 

Food prices probably will rise any way during the next decade as demand increases, especially in developing countries, and developments in agricultural productivity and arable land supplies lag behind, Nomura said

.  -RW

How to Adjust a $1,449 Herman Miller Pre-Assembled “Embody” Chair

Gary North is a genius economist and marketer, He recently bought a top of the line, Herman Miller "Embody" chair for $1,449.00

See that, you don't get to buy a $1,449.00 chair unless you are very good at what you do. He is good. What kind of chair are you sitting in?

That said, Dr. North had trouble adjusting his $1,449.00 chair:

They sent it. I unpacked it and sat in it. I was sitting as low as the chair allowed. So, I tried to raise the seat. No go. The little button that is supposed to raise the seat does nothing.
I brought in my wife, who is a true fix-it lady. No go.
There is a little instruction booklet, but there is no YouTube video on how to adjust the chair to the user’s size and shape. Yet these adjustments are crucial features in the marketing of this chair. It has been around since 2008. 
I contacted the company.
He titled a post about this:  My $1,449 Herman Miller Pre-Assembled “Embody” Chair Did Not Work. Perhaps he was not in a good mood when he wrote the post, given all the work he had to do to get his chair in adjustable shape.

But my post headline is going to attract much more traffic than his. (This is something, as I say, it is rare you beat Dr. North at marketing.Though, I am not sure he was even thinking marketing when he wrote his post.)

I don't do it often, but when I write a "how to" post, it is about a problem that I believe others have, and where I don't believe there is an easy way to find solution by a Google search.

(NOTE: Since this is a blog mostly about economics, I am justifying this post as an object lesson on scattered knowledge and how knowledge is a source of profit. I'm talking about a lesson in pure entrepreneurship, baby!)

In November last year, I wrote this post, How to Install Your SIM Card In An Amazon Fire Phone.

I still generate income from this post everyday. Everyday! Amazingly, I even sell Fire Phones, through the Amazon link regularly, even though the link itself is only to Amazon Fire accessories.

I thought this would be a big hit: How to Call Forward Calls as an ATT Customer, but so far it is only "okay."

But this Herman Miller how to post could be big. As Dr. North notes, there is no readily available information on the internet about how to adjust the chair that can be found by search. And it is such a high ticket item, anyone who comes to this post has the potential to click on some very high tickets ads. Yes!

So here goes for those of you trying to adjust a Herman Miller chair:

Here's the video on how to adjust the chair:

And for those of you that absolutely need one of these chairs, now that you are aware of it, I say, go for it. Click here:


Sunday, August 30, 2015

A Lesson From Hayek on How to Smash Someone

Hayek's brief discussion of Joseph Schumpeter's career included this:
[H]e also showed a strong receptivity to dominant opinions in his environment and the prevailing fashion of his generation. 

The Career Opportunities in Confused Economics

As a method of economic analysis econometrics is a childish play with figures that does not contribute anything to the elucidation of the problems of economic reality.
-Ludwig von Mises, The Ultimate Foundation of Economic Science

Somebody, please send these kids The Counter-Revolution of Science by F. A. Hayek.

These kids think the methodology of economics is the same as it is for physics.


Woman, 80, Trampled to Death in Venezuelan Supermarket Stampede

Crazed money printing plus price controls equals chaos and death.

The  Democratic Unity coalition said Maria Aguirre died and another 75 people were injured - including five security officials - in chaotic scenes when National Guard troops sought to control a 5,000-strong crowd with teargas.

"Due to the shortage of food ... the desperation is enormous," local opposition politician Andres Camejo said, according to the coalition's website. It published a photo of an elderly woman's body lying inert on a concrete floor.

Camejo said thieves had also attacked the crowd, members of which were seeking to buy cheap food at an outlet of the state's Mercal supermarket chain in Barinas state.


This is What Happens to You in China if You Report the Chinese Government Has Ditched Keynesian Interventionist Policy


Cuba Turns To Cloud Seeding Amid El Nino-Triggered Drought

Cuba announced Friday that it will employ cloud seeding to artificially induce rain in areas hit by the Caribbean island nation's worst drought in years. State newspaper Granma reported that the country will deploy a Russian Yak-40 aircraft in September to increase precipitation in areas that feed into the Cauto River. The Cauto is the country’s main source of water for reservoirs, reports the International Business Times.

"The period from January up to the present has been the driest in terms of precipitation since 1901," Argelio Fernandez, infrastructure head at Cuba’s state-run waterworks, told the Granma.

"The drought is everyone's problem and so every state entity has to ... create a plan immediately," Chapman Waught, head of Cuba’s waterworks, told Reuters earlier this month, in a typical socialist, central planning perspective that has made Cuba one of the the poorest countries in the Caribbean.

Drought conditions have hit several other Caribbean islands, including Costa Rica, due to the weather phenomenon known as El Nino, a warming of Pacific waters that affects wind patterns.


The European Migrant Crisis

Murray Rothbard's Ode to Lone Scientists and Inventors

In the recently released pamphlet written by Murray Rothbard in 1959, Science, Technology and Government, my favorite chapter is the one where Rothbard discusses lone scientists and lone inventors.

From the pamphlet:
The twentieth century has produced some great independent inventors, creators of many important new devises. One of them, the Englishman S.G. Brown (components for telegraphy, telephony, radio, and gyro-compass) declared: “if there were any control over me or my work every idea would stop.” Brown never accepted financial aid for experimental work, or for producing a new devise. How would such a man fare under the control of a government-directed research team, or one that was government-controlled? P.T. Farnsworth, great television pioneer, has always preferred to do his research on a small scale and with simple equipment. F.W. Lanchester, great British inventor in aerodynamics and engineering once wrote:
 “the salient feature of my career . . . (is that) . . . my work has been almost wholly individual. My scientific and technical work has been almost wholly individual. My"scientific and technical work has never been backed by funds from external sources to any material extent.”
 Lee de Forest, eminent inventor of the radio vacuum tube, always found it difficult to work under any conditions short of complete autonomy. Sir Frank Whittle invented the jet engine with very slim resources
C.F. Kettering often positively preferred simple equipment. And R.M. Lodge recently warned:
  “The trend towards more and more complex apparatus should be carefully watched and controlled; otherwise the scientists themselves gradually become specialist machine-minders, and there is a tendency, for example, for analytical problem to be passed from the microanalytical laboratory to the intra-red laboratory and from there to the mass spectrographic laboratory, whereas all the time all that was needed was a microphone and a keen observer.”[16] 
The worthy individual inventor is far from helpless in the modern world. He may, in a free enterprise system, become a free-lance consultant to industry, may work on inventions on outside grants, may sell his ideas to corporations, may form or be backed by a research association (both profit and non-profit), or may obtain aid from special private organizations that invest risk capital in small speculative inventions (e.g., the American Research and Development Corporations). 
One very important reason for the success of the independent inventor, and his preservation from the dominance of large-scale government-controlled projects, stem from the very nature of invention: “The essential feature of innovation is that the path to it is not known beforehand. The less, therefore, an inventor is pre-committed in his speculation by training or tradition, the better the chance of his escaping from the grooves of accepted thought.”[17] There are many recorded instances of the inventor winning out despite the scoffing of the recognized experts in the field, perhaps even emboldened because he didn’t know enough to be discouraged. One authority maintains that Farnsworth benefited from his lack of contact with the outside scientific world. Once, a professor gave him four good reasons why his idea—later successful—could not possibility work. Before the discovery of the transistor, many scientists claimed that nothing more could be learned in that field. Eminent mathematicians once claimed to prove logically that short-wave radio was impossible. Government-controlled research would undoubtedly rely on existing authorities, and thus would snuff out the searchings of the truly original minds. Many of the great inventors of recent times could not have gotten a research job in the field for lack of expertise: the inventors of Kadachrome were musicians; Eastman, the great inventor in photography, was a bookkeeper at the time; the inventor of the ball-point pen was an artist and journalist; the automatic dialing system was invented by an undertaker; a veterinarian invented the pneumatic tire. Furthermore, there are many inventors who are part-time, or one-shot, inventors, who are clearly more useful on"their own than as part of a research team. 
As the eminent British zoologist John Baker points out, the life of an independent researcher involves the willingness to bear great risks:
The life is too strenuous for most people, and the timid scientist hankers after the safety of directed teamwork routine. The genuine research worker is altogether different kind of person.[18] 
 Darwin once wrote
I am like a gambler and love a wild experiment.
  The importance of self-directed work to great scientists is stressed by the Nobel prize-winning chemical discoverer of vitamins, Szent-Gyorgyi, who wrote: 
The real scientist . . . is ready to bear privation . . . rather than let anyone dictate to him which direction his work must take.[19] 
 Not only inventors, but many types of scientist benefit from the work of independent researchers in their fields. Einstein said that: “I am a horse for single harness, not cut out for team work,” and suggested that refugee scientists take jobs as lighthouse-keepers, so that they could enjoy needed isolation. The fundamental discoveries in valence theory, cytogenetics, embryology, and many other fields of twentieth-century biology, were made by individual scientists.[20] Scientific discoveries, furthermore, cannot be planned in advance. They grow out of apparently unrelated efforts of previous scientists, often in diverse fields. The radium and X-ray treatments for cancer owe most, not to planned research, on cancer cures, but to the discoverers of radium and X-rays, who were working for quite different goals. Baker shows that the discovery of a treatment for cancer of the prostate emerged out of centuries of unrelated research on: the prostate, phosphatase, and on hormones, none of which was aimed toward a cancer cure....
[C]ompanies were originally apathetic about the possibilities of wireless telegraphy; RCA resisted Armstrong’s FM ideas; the Edison Company, at the turn of the century, scoffed at the idea of a gas motor for transportation, insisting on the future of the electric motor for that purpose; the established aircraft-engine firms scoffed at the jet engine and at the retractable under-carriage; the British and American chemical firms were highly critical of penicillin, and almost refused to take part in its development; The Marconi Company expressed no interest in television when it was brought to their attention in 1925; the manufacturers of navigational equipment took no part in the invention of the gyro-compass. When the Ford Motor Company sought to introduce automation in their factories, they turned to the small specialized firms in the machine-tool industry, “The small uninhibited firms with no preconceived notions.” And even Henry Ford resisted the thermostat, or hydraulic brakes.


Saturday, August 29, 2015

A Hint of Austrian Business Cycle Theory in NYT?

Pretty damn close.

At one point, William D. Cohan writes on current Fed interest rate policy in an essay that is awesomely titled, Show Some Spine, Federal Reserve:
 Like any commodity, the price of borrowing money — interest rates — should be determined by supply and demand, not by manipulation by a market behemoth. Essentially, the clever Q.E. program caused a widespread mispricing of risk, deluding investors into underestimating the risk of various financial assets they were buying.

The only way to return the assessment of risk to something resembling normalcy is to stop the manipulation.

Krugman's Take on Trump's Take on China's Stock Market Crash

I can't argue with this.
Then there’s Donald Trump, who likes to take an occasional break from his anti-immigrant diatribes to complain that China is taking advantage of America’s weak leadership. You might think that a swooning Chinese economy would fit awkwardly into that worldview. But no, he simply declared that U.S. markets seem troubled because Mr. Obama has let China “dictate the agenda.” What does that mean? I haven’t a clue — but neither does he.

Why the Fed Will Likely Raise Interest Rates Soon

Federal Reserve Vice Chairman Stanley Fischer spoke today at the Federal Reserve Bank of Kansas City Economic Symposium in Jackson Hole, Wyoming.

He said that "the labor market is approaching our maximum employment objective."

He also said, however, that "inflation has been persistently below 2 percent. That has been especially true recently, as the drop in oil prices over the past year, on the order of about 60 percent, has led directly to lower inflation as it feeds through to lower prices of gasoline and other energy items. As a result, 12-month changes in the overall personal consumption expenditure (PCE) price index have recently been only a little above zero."

But he went on to say, “With inflation low, we can probably remove accommodation at a gradual pace. Yet, because monetary policy influences real activity with a substantial lag, we should not wait until inflation is back to 2 percent to begin tightening.”

Thus, it is extremely likely that either at the September 16-17 FOMC meeting or the October27-28 meeting, the Fed will raise rates by a small amount, most likely 25 basis points.

My one caveat to this forecast is if a US stock market crash or extremely volatile stock market, with much downside action, develops. As I am reporting in the EPJ Daily Alert, because of a recent slowdown in money supply growth, a stock market crash is possible, though not a certainty.


Murray Rothbard on Alan Greenspan


Best Jobs for Millennials

WSJ explains the chart:

To come up with its list, researchers Konrad Mugglestone and Tom Allison considered three factors. First, the occupation’s median salary, to give a sense of what occupations may pay by mid-career. Second, the occupation’s projected growth in coming years. (Ask any journalist and you can get an earful about how a career path in a shrinking industry can be tough.) Third, whether a significant number of young people are in an occupation. Being a chief executive is great, but you don’t get hired for that role at age 22.

VIDEO: Tracking El Nino

BTW: Don't pay any attention to her comments about taking shorter showers or putting out rain buckets. Shortages and supply and demand are economics questions that have nothing to do with a necessity to act in some kind of group fashion to save a commodity---water or any other commodity.

Herbert Hoover Trump

By Lawrence Kudlow and Steve Moore

Here’s a historical fact that Donald Trump, and many voters attracted to him, may not know: The last American president who was a trade protectionist was Republican Herbert Hoover. Obviously that economic strategy didn’t turn out so well — either for the nation or the GOP.

oes Trump aspire to be a 21st century Hoover with a modernized platform of the 1930 Smoot-Hawley tariff that helped send the American and world economy into a decade-long depression and a collapse of the banking system?

We can’t help wondering whether the panic in world financial markets is in part a result of the Trump assault on free trade.

Mr. Trump is also now running full throttle on an anti-immigration platform that could hurt growth as well and alienate Republicans from ethnic voters that the GOP needs if it is going to win in 2016.

We call this the Trump Fortress America platform. He clearly sees international trade and immigration as a negative sum game for American workers.

He recently announced that as president he would prohibit American companies like Ford from building plants in Mexico. He moans pessimistically that “China is eating our lunch” and is “sucking the blood out of the U.S.?”

But strategic tax cuts and regulatory relief after the anti-business rule-making assault by President Obama, not trade and immigration barriers, are the solution to America’s competitiveness deficit.

A draft of Mr. Trump’s 14-point economic manifesto promises that, as president, he would “modify or cancel any business, or trade agreement that hinders American business development, or is shown to create an unfair trading relationship with a foreign entity.”

Read the rest here.

Friday, August 28, 2015

The Debate: Austrian Economics vs Neoclassical Economics

Dr. Walter Block responds to an email question  Original questions in red, Block's responses in blue: 

-----Original Message-----
Sent: Wednesday, August 26, 2015 4:57 PM
To: Walter Block
Subject: Austrian economics vs neoclassical debate


A. I watched your debate with Bryan Caplan. I was not impressed with him. I believe Mises was correct that economics is a science of logical deduction.
<< thanks. Here 'tis: for those who have not seen this.

B. Regardless, isn't it true that Hayek rejected the entire methodology and became an empiricist?

<< Yes, Hayek did reject the praxeological method; thus, he was an empiricist.  See this on that: Knott, Adam. 2012. "Hayek and Praxeology." November 13

However, even though he rejected what I see as the core of Austrian economics, he made magnificent contributions to Austrian business cycle theory. I'm a big tent kind of guy on matters of this sort, so I consider him an Austrian economist. Well, at the very least, a quasi Austrian. He wasn't all that good on libertarian theory, however:

Block, 1996, 1999, 2006; Knott, 2012; Rothbard, 1980, 1981-1982, 1998 (ch. 28)

Block, Walter E. 1996. "Hayek's Road to Serfdom," Journal of Libertarian Studies: An Interdisciplinary Review, Vol. 12, No. 2, Fall, pp. 327-350,; reprinted in Ama-gi: Journal of the Hayek Society at the London School of Economics, Vol. 1, No. 1, pp. 22-25

Block, Walter E. 1999. "The Gold Standard: A Critique of Friedman, Mundell, Hayek, Greenspan from the free enterprise perspective," Managerial Finance, Vol. 25, No. 5, pp. 15-33,

Block, Walter E. 2006. "Fanatical, Not Reasonable: A Short Correspondence Between Walter E. Block and Milton Friedman (on Friedrich Hayek 's Road to Serfdom)." Journal of Libertarian Studies, Vol. 20, No. 3, Summer, pp. 61-80;

Rothbard, Murray, N. 1980. "Hayek On Coercion and Freedom."  Literature of Liberty, Winter, pp. 53 54.

Rothbard, Murray, N. 1981-1982. "Hayek's Denationalised Money," The Libertarian Forum, Vol. 15, Nos. 5-6 (August-January), p 9;

Rothbard, Murray N. 1998 [1982]. The Ethics of Liberty, New York: New York University Press. (chapter 28)

C. Since praxeology uses logic to reach economic truths, doesn't the fact that Mises and Rothbard disagreed on the necessity of a state mean that one of them made a logical error?

There is an important distinction that must be made between normative and positive economics. Only the latter concerns "economic truths." But, whether a state is necessary is really a normative question. Thus, I see no necessary conflict between Mises and Rothbard.

D. Thanks, I appreciate your time. I'll try to stop e-mailing you so frequently!

<< no problem. I enjoy answering very good questions such as yours.

PS This Keynesian has done a lot of work exploring the different factions within the Austrian school. His blog is interesting.

Financial Times Calls For Abolishing Cash...

By Robert Wenzel

The establishment hates the idea that we often use cash and that we can not be tracked 24 hours a day. The hate is becoming more clear by the day. Now the Financial Times, partly owned by Lady Rothschild and her 83-year old husband, has issued an anti-cash diatribe.

FT, stealing from the flaming prose of John Maynard Keynes, has published an anonymous article, entitled The case for retiring another ‘barbarous relic’.

It calls for the abolition of cash in order to give central banks and governments more power.

Notes Paul Joseph Watson at Infowars, the article laments the fact that people are stockpiling cash in anticipation of another economic collapse, a factor which is causing, “a lot of distortion to the economic system.”
In other words, the bastards really don't want a penny to go thorough the system without their ability to monitor and control it.
Abolishing cash would also give governments more power to collect taxes directly from people’s bank accounts, the FT piece argues, noting how the “Value added tax, for example, could be automatically levied — and reimbursed — in real time on transactions between liable bank accounts.”
The article, as Watson notes, also calls for punishing people who use cash by making users “pay for the privilege of anonymity” so they will, “remain affected by monetary policy.” 
This is not the first call by the establishment for the abolishment of cash, the push to end cash has been picking up steam of late amongst elitist organizations, in recent months.
Watson notes:
As we previously reported Kenneth Rogoff, former chief economist of the International Monetary Fund... who has called for high denomination banks notes such as the €100 and €500 notes to be phased out of existence. attended a meeting in London earlier this year where he met representatives from the Federal Reserve, the ECB as well as participants from the Swiss and Danish central banks. The issue of banning cash was at the forefront of the agenda.
Last year, Rogoff also called for “abolishing physical currency” in order to stop “tax evasion and illegal activity” as well as preventing people from withdrawing money when interest rates are close to zero.
The agenda to ban cash was also discussed at this year’s secretive Bilderberg Group meeting, which was attended by the Financial Times’ chief economics commentator Martin Wolf.
Former Bank of England economist Jim Leaviss penned an article for the London Telegraph earlier this year in which he said a cashless society would only be achieved by “forcing everyone to spend only by electronic means from an account held at a government-run bank,” which would be, “monitored, or even directly controlled by the government.”
In the UK, banks are treating the withdrawal of cash in amounts as low as £5,000 as a suspicious activity, while in France, citizens will be banned from making cash payments over €1,000 euros from Tuesday onwards. The withdrawal and deposit of cash over the amount of €1,000 euros will also be subject to ID verification.

And I have reported,  JPMorganChase has started to prohibit the storage of cash in its safety deposit boxes. and Citi Group's top economist, Willem Buiter, has issued a report calling for the abolishment of cash.

The banishment of cash would, of course, put the entire economic system under the observation of the elitists, from where they can plot,control and take.

This is one of the most evil propositions now being advanced by the elitists. The idea must be shot down and discrdeited at every turn.

 Robert Wenzel is Editor & Publisher at and at Target Liberty. He is also author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics

Volens et valens: A Pregnant Latin Teacher Lands a Job

Don Boudreaus writes:
Duke University economics professor Ed Tower sent to me this morning the following e-mail, which I share below in full (with Ed’s kind permission):
When I got a job teaching economics at the University of Auckland in New Zealand, my wife, pregnant with our first to be born, and fresh with a MA in Classics from Harvard wanted to teach Latin at the university. She knew there wasn’t a big demand for Latin instructors, especially those who are going to have to take some time off in the middle of the semester, delivering offspring.  She wrote the Classics department chair, saying I want to teach for you and  you don’t have to pay me.  She was hired at her reservation wage of zero. The  classics department invited us to great  parties. The next year the Classics department paid her. Her experience teaching  at the university level enhanced her appeal for her subsequent career teaching at the Carolina Friends School and the Chapel Hill NC public schools, where she taught the young woman who delivered the Latin oration at her graduation from Harvard.    I suspect the university teaching helped  my wife get  a Fulbright to study one summer in Rome.  She maintained a warm friendship with the department  chair for the rest of his life. Had the University of Auckland been encumbered by minimum wages and fears of law suits for treating women unfairly, our two years in New Zealand would have been considerably less satisfying.  Ed Tower
The above originally appeared at Cafe Hayek.

Saudi Troops Invade Yemen; Oil Surges

 The Turkish newspaper, Haberler, reports that Saudi ground troops have entered Northern Yemen and seized control of two areas in the Saada province.

From Haberler:
Saudi Arabian ground troops have advanced into northern Yemen, in a bid to push back against Houthi Shia militia and forces loyal to ousted president Ali Abdullah Saleh, military and tribal sources said.

This is Saudi Arabia's first ground offensive in Yemen since it launched an extensive military campaign in March targeting Houthi positions.

The sources told Anadolu Agency that Saudi Arabian troops advanced into Saada province after Houthi militants recently stormed Saudi positions in the southern Saudi province of Jizan.

"Saudi ground forces seized control of two areas in Saada province and intend to advance toward Houthi positions," sources said.

Yemen descended into chaos last September, when the Houthis overran capital Sanaa and other provinces, prompting Saudi Arabia and its Arab allies to launch a massive air campaign against the Shia group.

Pro-Hadi forces – backed by Saudi-led air power – have managed recently to retake Aden and Taiz from the Houthis.

Crude oil is up 5.12% following an advance yesterday of 10%.


Fed's Fischer: Still Too Early to Tell if September Hike Will Happen

It's still too early to tell if recent market turmoil has made a September rate hike more or less compelling, Federal Reserve Vice Chairman Stanley Fischer told CNBC this morning.

In other words, the Fed is driving completely by the seat of its pants.If the market stabilizes over the next 2 to 3 weeks a rate hike is possible, If there is no volatility, there will be no rate hike.

"I think it's early to tell: The change in the circumstances which began with the Chinese devaluation is relatively new and we're still watching how it unfolds, so I wouldn't want to go ahead and decide right now what the case is—more compelling, less compelling, etc.," he said.

He added that "there was a pretty strong case" for a September hike, although that had not yet become a conclusion.


While Many Panicked, Japanese Day Trader Made $34 Million

Bloomberg reports:
While a lot of investors were hitting the panic button Monday, a Japanese day trader who’d made a big bet against the market timed the bottom almost perfectly and narrated a play-by-play of the trade to his 40,000 Twitter followers. He claims to have walked away with $34 million.
As financial markets got crazy this week, many people turned cautious. Some were paralyzed. Not the 36-year-old day trader known by the Internet handle CIS.
“I do my best work when other people are panicking,” he said in an interview Tuesday, about an hour after winding up the biggest trade of a long career betting on stocks. He asked that his real name not be used because he’s worried about robbery or extortion. To support his claims, he shared online brokerage statements showing his trades second by second.
CIS had been shorting futures on the Nikkei 225 Stock Average since mid-August, wagering it would fall. By the market close on Monday, a paper profit of $13 million was staring him in the face. He kept building the position. When he cashed out late that night, a collapse in New York had caused his profit to double.
Instead of celebrating, he kept trading. He started betting the market had bottomed. When he finally took his winnings off the table on Tuesday, he tweeted, “That’s the end of my epic rebound trade.” His profit, he said, had almost tripled.
“It was a perfect trade,” said Naoki Murakami, who follows CIS on Twitter and whose markets blog has made him a minor celebrity in his own right.

IT'S HERE The Ultimate Minimum Wage Attack: A Totally Robotic Restaurant

Not surprising, it is being launched in San Francisco, the land where Janet Yellen pumps money daily and which has one of the highest minimum wages in the country.

Therese Poletti writes  (my bold):
I must admit that I fully expected to dislike Eatsa, a new restaurant slated to open next week in San Francisco with a sleek, 21st Century take on the famous Horn & Hardart Automat...

Eatsa now is looking to become the modern-day equivalent....driven by 21st century technology. Customers place their orders on touch-screen iPads or iPhones. No humans take your order or serve you; a half-a-dozen or so people are preparing orders on an automated assembly line behind the scenes. And in minutes your name appears on a food cubbie with your order, a $7 quinoa bowl.

But instead of being horrified, this nearly robotized fast-food restaurant stole my vegetarian heart. Eatsa’s co-founders have ambitious and seemingly virtuous goals: they want to serve healthy food faster and cheaper — and give their items the sort of crave-ability factor that sends you to the refrigerator late at night. “Healthy food does not have that crave-ability,” said Scott Drummond, co-founder of Eatsa....

Eatsa executives did not disclose much about the technology, except to say it is data-, science-, and software driven. The company will use automation as much as possible to keep costs lower, and the team spent more than a year on scientific research and taste-testing to create the menu.


HOT Schwab Says Online Trading Unavailable

Charles Schwab has issue a release that says it's online trading platform is down.

The firm did not immediately provide additional details.

This is a developing story, please return to this post for updates.


Charles Schwab's online trading platforms are back online this morning after being "temporarily unavailable."

New National Labor Relations Board Ruling is Going to be a Major Problem for Fast Food Chains

The National Labor Relations Board, in a long-awaited ruling, made it easier on Thursday for unions to negotiate on behalf of workers at fast-food chains and other companies relying on contractors and franchisees.

The labor board, changed the definition of a crucial employer-employee relationship that had held in some form since the Reagan era of the 1980s.

Now, a company that hires a contractor to staff its facilities may be considered a so-called joint employer of the workers at that facility, even if it does not actively supervise them.

A union representing those workers would be legally entitled to bargain with the parent company, not just the contractor, under federal labor law.

NYT explains:
“The decision today could be one of the more significant by the N.L.R.B. in the last 35 years,” said Marshall B. Babson, a lawyer who helped write a brief opposing the rule for the U.S. Chamber of Commerce. “Depending on how the board applies its new ‘indirect test,’ it will likely ensnare an ever-widening circle of employers and bargaining relationships.”
For example, if employees at a fast-food restaurant run by a franchisee were to unionize — something almost none have succeeded in doing to date — they would immediately be entitled to negotiate not just with the owner of the individual restaurant but also with the corporate headquarters.
If the corporate parent were to agree to pay higher wages or provide better benefits, it would apply only to that particular restaurant, in the same way that concessions granted to employees in a single unionized portion of a national company that is not franchised apply only to that portion. At the same time, however, the concessions may give unionized employees at other locations practical leverage in their negotiations with the company.
Many large companies maintain that they should not be required to bargain with employees of their contractors or franchisees...
The ruling may have an immediate effect on a case the labor board is litigating against McDonald’s and several of its franchisees. In that case, the N.L.R.B.’s general counsel, who essentially acts as a prosecutor, asserts that the company is a joint employer along with a number of franchisees, making it potentially liable for numerous reported violations of workers’ rights, like retaliating against those who have tried to organize unions.
Business representatives said the labor board was making it much harder to operate franchises in the future, undermining a popular path for many entrepreneurs.
Richard Adams, a former McDonald’s franchisee who runs a franchise consulting firm, said the ruling made no sense to him, given how most franchise businesses operate.
“It’s so far from the reality of what actually takes place in the business that it can’t have any practical application,” Mr. Adams said. “McDonald’s doesn’t control these employees — it doesn’t hire them, it doesn’t train them, it doesn’t supervise them, it doesn’t pay them, it doesn’t even have their Social Security numbers.”
This is going to be a regulatory nightmare,that will include  harassment of corporations by franchise employees, at the instigation of union operatives, It will take the franchiser/franchisee relationship to an unnecessary much more complex level.


Inflation, Inflation, Inflation (Don't Worry, The Central Bankers Have It All Under Control)

Going on right now in Jackson Hole, Wyoming is the annual central bankers' symposium sponsored by the Federal Reserve Bank of Kansas City. For a group that thinks it has price inflation under control, they certainly are spending a lot of time discussing the topic. has obtained  copy of the symposium agenda (below)

Thursday, August 27, 2015
6 p.m.
Opening Reception and Dinner

   Host: Esther George
  President and Chief Executive Officer
  Federal Reserve Bank of Kansas City

Thursday, August 27, 2015

Latin Americans Lead World in Emotions

According to Gallup, led by Bolivia and El Salvador, Latin American countries dominate the top of the list of the most emotional countries in the world for 2014. On average, nearly six in 10 residents in each of these countries reported experiencing positive or negative emotions the previous day. Post-Soviet states largely dominate the list of countries at the other end of the spectrum, where at most four in 10 residents reported experiencing any of these feelings.

Gallup measured daily emotions in 148 countries in 2014 by asking people whether they experienced five positive and five negative emotions a lot the previous day. The five negative experiences include anger, stress, sadness, physical pain and worry. The five positive experiences include feeling well-rested, being treated with respect, enjoyment, smiling and laughing a lot and learning or doing something interesting. The most and least emotional countries are based on the rankings of the average "yes" responses to all questions.

'Black Lives Matter' Activist Opposes Minimum Wage Hike

A St Louis alderman who appears to have a good gut instinct recognition of the problem with minimum wage laws (via WaPo)
[I]n St. Louis, a small fracture appeared Wednesday when Democratic Alderman Antonio French — who came to national prominence during the protests, has supported Black Lives Matter and sees himself as a mediator between residents and the police — published an editorial in the St. Louis Post-Dispatch explaining his opposition to a measure that would raise the city’s minimum wage to $11 by 2018. Doing so, he argued, could send what few jobs exist in the community out to St. Louis County, which has given no indication it’s willing to raise its own wage floor.

"In my neighborhood, when I look at the young guys, black males, unemployment is close to 50 percent,” French said in an interview. “For me, my main interest is to get people to work.”

That puts him at odds with some constituents, like Ashli Bolden, a community organizer with Missouri Jobs with Justice who lives in French’s ward.

“He’s screaming black lives matter, but we don’t deserve higher wages?” Bolden says. She’s noticed plenty of low-wage employers opening in the area, and thinks they could afford to pay more. “I can’t see these Family Dollars moving to the county because of a wage increase.”