Category Archives: Monetary Theory

Leverage – The Loose Joint Which Makes The Trade Cycle Inevitable

Credit and leverage are at the heart of Friedrich Hayek’s conception of the boom and bust cycle.  In the current crisis leverage and credit are receiving a good bit of attention — and even a few economists are beginning to take notice of their significance.  … Continue reading

Posted in Boom & Bust, Monetary Theory, Money & the Trade Cycle | Tagged | 1 Comment

Credit & Leverage – The Fulcrum Of The “Loose Joint” Launching Booms & Busts

Hayek identified money and the institutions it gives rise to as the “loose joint” of the economic system.  Money and finance are the massive pivot points that allow the coordination system of the market to spend years getting itself twisted … Continue reading

Posted in Boom & Bust, Monetary Theory | 1 Comment

SEMINAR: Hayek’s _Monetary Theory and the Trade Cycle_

There can be no better time than now to grapple with Hayek’s most broad ranging book on the problems of money and the trade cycle, at a time when economists are again opening their minds to the fundamental questions of … Continue reading

Posted in Boom & Bust, Monetary Theory | 1 Comment

Steve Hanke vs Ben Bernanke & the Fed

Quotable: “During his face time [on national TV Ben] Bernanke explained many things ..  Unfortunately, he did not address my main beef with the bank: that it clings to a flawed inflation-targeting regime with a horrible history of monetary policy … Continue reading

Posted in Deflation, Federal Reserve, Monetary Theory | Comments Off on Steve Hanke vs Ben Bernanke & the Fed

It’s Back To First Principles — And Hayek — At The Bank of England

The London Telegraph: in a strange way, the by-product of this financial collapse has been to free economics of this burden. In the corridors of the Bank of England and Treasury, there is a distinct whiff of excitement. For the … Continue reading

Posted in Monetary Theory | Comments Off on It’s Back To First Principles — And Hayek — At The Bank of England

wikipedia: “Neutral Money”

The Wikipedia entry on “Neutral Money”: The term “neutral money” was coined by Friedrich Hayek, and was originally defined as a market coordinating money rate of interest which did not create a boom and bust cycle by falsely misdirecting investment … Continue reading

Posted in Monetary Theory | 2 Comments