Monetary policy

Europe’s slow, painful death

There is something comical about current talk about a potential Greek bankruptcy. No, the state of Greece’s public finances is certainly no laughing matter. But it is funny how politicians and financial markets are getting excited about this as if it were news. [...]

Property bias

Price increases in any other market are called inflation, but when house prices go up the market is said to be healthy. But house price increases are only shifting wealth from non-owners to owners. Rising houses prices never create wealth. In fact, they make tenants wishing to buy property worse off. [...]

Australia’s forgotten savers

Australia’s addiction to the property market needs to stop if we care about housing affordability. And if we care about the level of private debt, then we need to make saving a much more attractive option for young Australians. [...]

Kredit verspielt

Angesichts der Dimensionen der aktuellen Krise nimmt es nicht wunder, dass das Vertrauen in Marktwirtschaft und Globalisierung erschüttert ist. Ob es jemals besonders verbreitet war, ist eine andere Frage. Aber selbst entschiedene Anhänger freier Märkte sind irritiert. [...]

Lack of trust, not lack of cash

There is no economic law that says that share prices should never fall. It would be wiser if central bankers stepped back and let the markets clear up the mess that was first and foremost caused by loose monetary policies. [...]

Disaster of our credit culture

Private and public overspending has fuelled Britain’s economic growth of the past but it is now high time to rid ourselves of our sweet tooth for debt. The Chancellor is right but his words are just a little hollow without an acknowledgement that the Government has contributed to the current credit crisis. The forthcoming comprehensive spending review would be a good opportunity for Mr Darling to follow his words with action. If his own finances were in order, his advice to the private sector would carry greater weight. [...]

A plea for sound money

Strangely enough, although most other kinds of socialism have frequently been attacked by advocates of the free market, the ‘meta-intervention’ of government-created paper money is hardly being called into question. In the long run, however, the destructive effects of false money could be even more disastrous than Soviet-style communism. [...]