Fed Chairman Ben Bernanke loses sleep over the possibility that the United States may suffer a repeat of the 1930s Great Depression. Inflation hawks and opponents of President Obama’s Keynesian “stimulus” warn continually of a possible repeat of the 1970s stagflation. Yet recent data is beginning to suggest a more unpleasant possibility still: that the […]

The United States is often held out as the world’s principal beacon of free-market principle. To the extent that it backslides, there is thought to be little hope for such principles in other countries. Yet as last week’s housing finance debate demonstrated again, the United States was populist before it was capitalist, and free-market principles […]

The last 15 years in global markets have been marked by one consistent factor: the ready availability, even overabundance of capital. Returns to investors have been driven down to dangerously low levels, both in debt and equity, by over-expansionary monetary policy, while asset values even after crashes have been far higher than their historical norms. […]

Observers have been startled by the recent slowing of US economic recovery. A recession as deep as that of 2008-09 would normally be followed by a recovery of exceptional vigor. Austrian and other anti-Keynesian commentators, myself included, have pointed the finger of blame at the excessive fiscal stimulus of 2009-10 and at the locked-in Fed […]

Niall Ferguson’s new biography of Siegmund Warburg is interesting in many respects, but it illuminates in particular one aspect of Warburg’s belief system: even in the latter part of his life — the 1950s through his death in 1982 — he believed that he was witnessing the decline of European civilization. Given that he saw […]

The increasing divergence of the U.S. and EU economies, and the sluggish statistics coming out of the former, point to one inescapable conclusion: the U.S. policy mix, in fiscal, monetary and regulatory areas, has been uniquely bad. This is not simply a question of party or ideology: under the Democrat Clinton administration economic policy was […]

The British government’s announcement that it intends to force a change in indexing of private sector pensions from the Retail Price Index to the Consumer Price Index, thereby making British pension schemes sounder while depriving aged pensioners of 25% of their expected income is typical of an unpleasant recent trend. Governments are manipulating official statistics […]

There’s a new acronym for favored emerging markets – CIVETS. Coined again by Goldman Sachs’ Chief Economist Jim O’Neill (who invented the BRIC acronym for Brazil, Russia, India and China in 2001) it stands for Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa. However the new acronym’s enthusiasts may have missed out on one thing: […]

For the past three months, markets have been worrying about the future of countries in the European Union, and more particularly within the zone that uses the euro. The euro has fallen consistently against the dollar and euro denominated bond yields of southern European countries have risen to heights at which financing budget deficits becomes […]

As anyone who has played “Diplomacy” knows, the economic and political world from 1871 to 1914 was one of Mancihean struggle, with countries attempting to establish spheres of influence behind high tariff barriers, and multiple power centers between which war was by no means impossible. As the mildly social democrat Nirvana of the 1990s recedes […]