Money and Banks

Interviewed by host Elijah Johnson, Mark Thornton explains how the Austrian view of economics contrasts

The Greeks may still default, and that would mean big trouble not so much for Greece as for other EU member states who will be on the hook for even more bailouts.

The Greeks may still default, and that would mean big trouble not so much for Greece as for other EU member states who will be on the hook for even

Popular opinion seems to be that falling prices—or even stable prices—are bad for the economy, but I’ve never seen any good arguments about why.

The recent de-peg of the Swiss franc from the euro illustrates the importance of currency competition, and the damage that state monopolies over money can do. We Americans should embrace currency competition here at home as well.

If given a choice, people will avoid paper money that is declining in value, thus putting a restraint on inflationary bank notes. To shield banks from this, they turned to a monopolist central bank that issues legal tender and helps private banks inflate.

The Swiss franc was pegged to the euro in 2011, but after years of easy money in the eurozone, the Swiss have bailed in an effort to save the franc from even more inflation that's expected from the Europen Central Bank.

The homeownership rate is now back where it was forty years ago. So what did all that federally-subsidized homebuying over the past decade accomplish? There was a lot of malinvestment, and a lot of politically-favored interest groups that got richer.

The lesson is clear. If Switzerland can retake control of its money, so can any eurozone nation.

The homeownership rate is now back where it was forty years ago.