Business Cycles

A general rise in prices can only occur if there is either a drop in the supply of all commodities or an increase in the supply of money.

James Grant, writing in the New York Times, gives the briefest possible explan

The Hans Sennholz Memorial Lecture, delivered at the Austrian Student Scholars Conference hosted by Grove City College; 2 November 2007.

Here lie the two key factors that make the current cycle different than the past 2 cycles.

We suggest that by attempting to counter various shocks that are predominantly the product of Fed's own policies, Bernanke's Fed has likely made things much worse as far as real economic fundamentals are concerned.

How did the Mises Institute come to be the publisher of Mises: The Last Knight of Lib

In the Austrian view, the boom-bust cycle is caused by the Fed's maintenance of artificially low interest rates, which causes businesses to expand, hire workers, buy other resources, and so forth, even though these projects are not justified by the true supply of savings in the economy. The greater the "stimulus" the worse the malinvestments.

In the Christian Science Monitor, here is George Selgin:

Despite what critics of the ABCT say, entrepreneurs can't easily avoid the effects of Fed intervention.

James Grant writes in the New York Times today, on cue as