{"id":326247,"date":"2024-02-27T18:51:02","date_gmt":"2024-02-28T00:51:02","guid":{"rendered":"https:\/\/conk.com\/?p=326247"},"modified":"2024-03-06T09:23:32","modified_gmt":"2024-03-06T15:23:32","slug":"why-mainstream-economics-is-the-dismal-science","status":"publish","type":"post","link":"https:\/\/conk.com\/contributors\/sabrin\/why-mainstream-economics-is-the-dismal-science\/","title":{"rendered":"Why mainstream Economics is the dismal science"},"content":{"rendered":"

Take a few minutes and read the recent piece by Paul Davidson in USA Today<\/a> about whether the Federal Reserve should lower interest rates in March or no later than June to fight a recession.\u00a0<\/p>\n

Davidson and the economists he interviewed do not mention the Fed\u2019s inflationary policies that increased the money supply by trillions of dollars in 2020 and 2021. This huge surge in \u201cnew money\u201d was the primary reason for inflation reaching a peak of 9.1 percent in June 2022.<\/p>\n

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Murray\u2019s Newsletter is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.<\/p>\n<\/div>\n

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Increases in the money supply is the cause of price inflation.\u00a0 And the Fed\u2019s driving down interest rates to nearly 0% for several years is the cause of an overheated economy that eventually leads to a recession.\u00a0 The Fed\u2019s hiking of interest rates is its reaction to the inflation it caused in the first place.<\/p>\n

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In short, the Fed causes inflation and recessions.\u00a0 The proper monetary policy is for the Fed not to do \u201cquantitative easing\u201d like it did for two years to boost the economy during Covid and it should not manipulate interest rates to goose production and employment.\u00a0<\/p>\n

In other words, the Fed should close its doors or at the minimum stop inflating and that would end the boom-bust cycle.\u00a0 As Ludwig von Mises observed decades ago:<\/p>\n

\u201cThe wavelike movement affecting the economic system, the occurrence of periods of boom which are followed by periods of depression is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion\u201d. \u00a0Human Action<\/a><\/em>, p.572<\/p>\n

If the Fed lowers interest rates in 2024, it means the economy has indeed entered a recession and this will be followed by another round of inflation and then the inevitable bust down the road.\u00a0 Currently, the economy is indeed weakening.\u00a0 It is not as strong as the economic data suggest.\u00a0<\/a><\/p>\n

In the meantime, don\u2019t let the headlines spook you.\u00a0 If you are concerned about being laid off, get a side \u201chustle\u201d ASAP to earn some extra money before a pink slip could your way.<\/p>\n

Tom Woods provides tools to increase your income.\u00a0 https:\/\/tomwoods.lpages.co\/my-crash-course\/<\/a> and https:\/\/tomwoods.lpages.co\/online-course-profits\/<\/a>.<\/p>\n

Take advantage of the free advice.\u00a0<\/p>\n

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Every Wednesday at\u00a011:05am talk show host Gary Nolan and I discuss<\/a>\u00a0the economy and politics.\u00a0\u00a0The Fort Myers Mises Circle presentations are available online<\/a>.\u00a0<\/p>\n

Latest podcast on healthcare<\/a>\u00a0with host Johnathan Westover;\u00a0Incentivizing wellness podcast<\/a>\u00a0with Bernadette Pajer;\u00a0the Human Action podcast<\/a>\u00a0with Bob Murphy on my American journey;\u00a0Joseph Cotto and I<\/a>\u00a0discuss Argentina and the US, and the Human podcast with Bob Murphy on<\/a> healthcare; Robert Scott Bell and I discuss healthcare<\/a> on the second hour of his podcast.<\/p>\n

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Murray Sabrin, PhD, is emeritus professor of finance, Ramapo College of New Jersey. Dr. Sabrin is considered a \u201cpublic intellectual\u201d for writing about the economy in scholarly and popular publications. His new book,\u00a0The Finance of Health Care: Wellness and Innovative Approaches to Employee Medical Insurance<\/a><\/strong>\u00a0(Business Expert Press, Oct. 24, 2022), and his other BEP publication,\u00a0Navigating the Boom\/Bust Cycle: An Entrepreneur\u2019s Survival Guide (October 2021),<\/a>\u00a0provides decision makers with tools needed to help manage their businesses during the <\/em>inexecrable business cycle.\u00a0 Sabrin’s autobiography,\u00a0From Immigrant to Public Intellectual: An American Story,<\/a><\/strong>\u00a0was published in November, 2022.<\/em><\/p>\n

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Murray\u2019s Newsletter is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.<\/p>\n<\/div>\n

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Journalists and economists still don\u2019t get it More<\/a><\/p>\n","protected":false},"author":1,"featured_media":245423,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[310],"tags":[],"_links":{"self":[{"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/posts\/326247"}],"collection":[{"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/comments?post=326247"}],"version-history":[{"count":0,"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/posts\/326247\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/media\/245423"}],"wp:attachment":[{"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/media?parent=326247"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/categories?post=326247"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/conk.com\/wp-json\/wp\/v2\/tags?post=326247"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}