The Bank of Canada's official mandate to promote the “the economic and financial well-being of Canadians,” isn't compatible with the Bank's real mandate which is apparently to look out for the good of a small number of powerful banks.
By creating money out of thin air, central banks repeatedly create bubble industries that must inevitably be liquidated.
Dr. Jeffrey Herbener joins The Human Action Podcast for an extended discussion of Mises's seminal work.
While government spending re-allocates and distorts resources, it is not necessarily inflationary. Inflation really just stems from money creation and fractional-reserve lending carryied out by central banks and private banks — thus creating money "out of thin air."
Since we don't know the future, all investment is a type of speculation, and this doesn't mean banks are behaving nefariously when investing other people's money.
Keynesian economics is the economics of debt-addicted, lower-class spendthrifts: modern governments.
As flaws in the system of fractional-reserve free banking began to appear, private central bank-like institutions known as clearinghouses sprang up, and they helped pave the way for the Fed.
Like taxation, government spending diverts resources from real wealth-generating ventures. Borrowed funds for continued spending must also be repaid, so current spending translates to future taxation.
Dr. Salerno discusses his intellectual roots and scholarly work, as well as his funny adventures with Murray Rothbard.
Regardless of expectations, tampering with the economy by means of monetary policies will always undermine the foundations of the real economy.
