At the beginning of the Great Depression, world trade dropped by an “astounding 65 per cent in gold-dollar terms”.
Vito Tanzi has again given us a solid economic explanation of what went wrong and why, and what can be done about it. Governments have grown too large, have spent way too much money, and have tried to get out of the mess through the inappropriate use of monetary policy rather than by drastically cutting spending.
In Getting it Wrong1 William Barnett, an aggregation and index number theorist, makes a few important points about monetary policy in the United States, along with a few questionable claims for how to fix it, and some fairly bazaar speculations about why his proposals have received so little traction.
In 1814, the US already had the highest per capita income and one of the largest territories of any country, a mid-sized population of eight million – significant for countries of the time; and it had taken on Great Britain, the military and economic superpower of the day, and fought it to a stalemate on the land and sea.
The United States has had 14 banking crises over the past 180 years! Canada, which shares not only a 2,000-miles border with the United States but also a common culture and language, had only two brief and mild bank illiquidity crises during the same period
Inflation is the work of the devil, because it respects appearances without destroying anything but the realities. Jacques Rueff
In his “Europe’s Unfinished Currency”, Thomas Mayer gives us a highly readable account of the political origins of the European Union and its currency and its current weaknesses and promise.
Detlev Schlichter says that “Today’s mainstream view on money is logically incoherent because it is in fundamental conflict with essential aspects of money and money’s role in a market economy.”
Have you ever wondered how the United States and other countries actually conduct “financial warfare”?
Robert Pringle’s The Money Trap should be very high on the list of books for anyone wanting to understand the weaknesses and flaws in the existing approaches to national monetary and banking policies and the international arrangements that link them.