No one can contend that the Federal Reserve System has brought economic stability or conquered the trade cycle, writes Hans Sennholz. On the contrary, its critics are convinced that a politically conceived and administered money monopoly, such as the Federal Reserve System, is the worst of all money systems. It will breed business cycles as long as it lives.
The best thing Greenspan can do, other than to close down the fraudulent entity known as the Federal Reserve System, is to sit back and do absolutely nothing. A sedentary Alan Greenspan harms no one. When he is active, however, watch out, says William Anderson. The man is dangerous.
Frank Shostak explains why Greenspan's latest move to cut interest rates will not only not help, but it will actually delay recovery by months or even many quarters. The fundamental problems inhibiting recovery are too severe to be fixed by mere money creation.
The Spitzer restructuring of Wall Street will not achieve its stated objective of restoring confidence in the stock market, writes James Sheehan. Instead, it will create a government sanctioned stock research cartel, the legacy of which will be higher costs, more inefficiency, and less competition.
The idea of resorting to work and entrepreneurialism as a means to material well-being has historically become a poor second to the idea of acquiring resources through theft. This robbery is always most effectively perpetrated when disguised and when legally underwritten by the threat of political violence–-i.e., when it is committed by the State.
There is something about monetary phenomena that make them a particularly misunderstood aspect of economic life. Deflation is no exception. There seems to be little understanding as to what it is, what causes it, and whether or not it is something that should be prevented. The effects of deflation, like the quality of drinking water, cannot be considered without regard to its source.
The Federal Reserve is continuing to experiment with new, more counterfeit-proof paper money. Recently, it was big faces, along with the introduction of a variety of other difficult-to-counterfeit characteristics into our Federal Reserve Notes. Next, maybe, it will be color. Or, writes Clifford Thies, perhaps the real issue is not the color on the back of the money, but money’s real backing.
The trouble with lowering the interest rate, writes Frank Shostak, is not that the Fed may lose a tool to fight a further downturn; the problem is that a lower rate now will make things much worse rather than better. Fifty years of experience suggest it will set in motion a much more painful economic adjustment in the months ahead.
News reports now indicate that WorldCom's overstatement of its profits in the last few years may exceed initial reports. But, writes George Reisman, whatever the ultimate figure may be—$7.1 billion or even $10 billion—it pales into insignificance in comparison with the overstatement of profits regularly engineered by the U.S. government.
