Category: Federal Reserve

Dear Republican Candidates: It’s Monetary Policy, Stupid

At barely five feet tall and armed only with a Ph.D in economics, Milton Friedman hardly had the look of a hero set out to save a nation. Yet, Professor Friedman predicted with near perfection the disastrous economic situation the United States is enduring today. He did this with a simple idea – the Quantity Theory of Money.

MV = PQ. This is the simple mathematical formula which explains the death of American prosperity. Where M is the supply of money, V is the velocity that it circulates, P is prices, and Q is the quantity of transactions. Simply put, if the government prints more money, prices go up unless the number of transactions also increases. Too many dollars chasing too few goods, as they …


Pondering the Passion for Paul: Ron Hits Town as Iowa Campaign Hits Stride

On a macro level the last few weeks of the Ron Paul Presidential campaign have been a little bumpy. The turbulence was provided by a much publicized exchange with WHO Radio’s Simon Conway and rough national television interviews with MSNBC’s Chris Mathews and Fox News’ Chris Wallace. The fact that the Mathew’s interview would be contentious was likely known, but having Chris Wallace, on Fox News Sunday, aggressively infer that the “general welfare” clause was valid justification for unlimited Federal government involvement had to come as a shock (I know I was shocked).

If one thought that would dampen his supporters’ enthusiasm, a few minutes spent at the Paul campaign headquarters in Ankeny on Monday would be enough to prove them mistaken. In fact the …


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The Big Spanking

Our grandchildren were over last weekend–two boys ages 5 and 3.  At one point the 3-year-old was telling me about being disobedient and how Daddy had to give him a big spanking.  Now I know my son and I’m sure that he was providing gentle discipline, but the point wasn’t lost and can be applied to last week’s election.

Much has been made of the Republican’s gains in the House and Senate, and their effective control of Congress.  This was clearly a repudiation of the Obama, Reid, and Pelosi policies of economic stagnation.  Make no mistake about it, this was about the economy.  The Democrats insistence on spending taxpayer’s money ineffectively, squandering it, actually, passing huge and unpopular bills, and their complete lack of caring …


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