Uneasy Fiscal View from Jackson Hole

The weather has been great in the Grand Tetons.  Sunny, highs in the 80s, lows in the 40s with a chance of thunderstorms (always a possibility when central bankers gather).  Grand Teton, Mt. Owen, and Teewinot look down in all their majesty on Jackson Lake Lodge, where the world top financial officials can try to spot moose feeding in Willow Flats below, sip a merlot on the Sunset Terrace, and contemplate the limitations of their tools to manipulate the world’s financial problems while meeting in the Explorers Room.

One thing the central bankers will be unlikely to do – mingle with the millions of people around the world who have become unemployed because of their policies. Theoretically, they will be looking ahead to a better more, prosperous world.   Fat chance. "When Kansas City Fed leaders decided months ago on the topic of this year's conference — "Achieving Maximum Long-Run Growth" — they did so advisedly," wrote the Washington Post's Neil Irwin. "The implicit message was that the focus of the world's economic policymakers was no longer about financial crisis firefighting, but about laying the groundwork for a stronger global economy over the longer run. It's not about growth in the next quarter but in the next decade, or three. In hindsight, the topic seems almost aspirational. If only the world were in position to worry about the long term, rather than the short term!"

Jackson Hole - Ben Bernanke Fed PolicyFor Fed Chairman Ben Bernanke, the annual conclave offers him the opportunity to give a sort of “State of the World Economy” address. In advance of his speech Friday, the markets gave a thumbs down to what he might say and the dollar fell against the euro and the yen. Friday morning, Bernanke announced essentially a wait-and see approach to monetary policy without closing the door to the quantitative easy that has flooded the world with U.S. dollars: “We will continue to consider those and other pertinent issues, including, of course, economic financial developments, at our meeting in September.”

Unhelpfully, Bernanke observed: "Fortunately, the two goals of achieving fiscal sustainability — which is the result of responsible policies set in place for the longer term — and avoiding the creation of fiscal head winds for the current recovery are not incompatible." But he batted the ball for fiscal recovery to Congress and the Executive branch for them to devise "policies that support robust economic growth in the long term."

A bit more clearly, he said of the problems of European governments and banks: "It's difficult to judge how much these developments have affected economic activity so far, but there seems little doubt that they have hurt household and business confidence and that they pose ongoing risks to growth."

So, while the East Coast battened down for a hurricane, out west it was policy as usual, the same ones that got us in this mess. Have another merlot. Thunderstorms predicted for Saturday.

Image courtesy of: http://www.ecotripadvisor.com

Vinaora Nivo SliderVinaora Nivo SliderVinaora Nivo SliderVinaora Nivo Slider

The Most Important Thing Holding Up the US Dollar

by Ron Paul

Today’s economic conditions reflect a fiat monetary system held together by many tricks and luck over the past 40 years. The world has been awash in paper money since removal of the last vestige of the gold standard by Richard Nixon when he buried the Bretton Woods agreement — the gold exchange standard — on August 15, 1971.

Since then we’ve been on a worldwide paper dollar standard. Quite possibly we are seeing the beginning of the end of that system. If so, tough times are ahead for the United States and the world economy.

Yellen’s Missing Jobs

March 31, 2014

The new Federal Reserve chairman, Janet Yellen, gave a policy speech today at Chicago, where, in a startling gesture, she mentioned three working individuals by name — Jermaine Brownlee, Vicki Lira, and Doreen Poole. They lost their jobs the Great Recession and have been struggling ever since. It was a refreshing, even affecting demarche by Mrs. Yellen, who has made a return to full employment a public priority. She underscored her sincerity by telephoning Mr. Brownlee and Ms. Lira and Ms. Poole before delivering her speech.

Read More


The Rueffian SynthesisJohn D. Mueller

Publisher's Note: Originally released in June/July of 1991, this detailed report discusses Jacques Rueff's economic theories and applies them to modern economic events.

By John D. Mueller

Who Was Jacques Rueff?

... Trained in science and mathematics at the Ecole Polytechnique, Rueff devoted his first theoretical work to showing that the same scientific method applies to “moral” or “social” sciences like economics as to the physical sciences (Des Sciences Physiques aux Sciences Morales, 1922). In both cases, he pointed out, individual acts can be “indeterminate,” but the pattern of large numbers of individual acts can be predicted as a matter of probability. And so in economics no less than physics, as he later wrote, “A scientific theory is considered correct only if it makes forecasting possible.”

Read More

Excerpts From:

by Lewis E. Lehrman

"Forerunners of man lived upon the planet several million years ago. But the unique, modern, social order of man – civilization – emerged only four to five thousand years ago. Historical and archaeological evidence suggests that the institution of money evolved coterminously with civilization. From the standpoint of the 100,000-year history of Homo sapiens, civilization and money are but young and fragile reeds. Today their very existence is threatened by financial disorder."

Learn More


Turkey’s Cut-rate Expectations

Kathleen Packard  |  Apr 18, 2014
There is a lot of bad behavior in the global political and monetary world. Much of it comes in countries that should know better. Recep Tayyip Erdogan’s Justice and Development Party (AKP) easily won municipal electons in Turkey but the party’s candidates won far short of the nation’s votes. The Wall...
Hostility toward gold has a long pedigree.  19th century depiction of Pliny the Elder courtesy of the Library of Congress Gaius Plinius Secundus, commonly known as Pliny the Elder, in his The Natural History, Book 33, section 3, writes: Would that gold could have been banished for ever from the earth, accursed by...
Jacques Rueff, a key figure in European economic circles from the 1930s until the 1970s, was, first and foremost, an...
Apr 09, 2000
Key Monetary Writings
Lawrence H. White and George Selgin

Why Private Banks and Not Central Banks Should Issue Currency, Especially in Less Developed Countries

In all but a few areas of the world today (Northern Ireland, Scotland, and for the time being...
Prosperity Through Gold
Please sign me up to receive free, noncommercial, news and analysis.
You can easily and safely unsubscribe anytime. Privacy Policy

Kathleen M. Packard, Publisher
Ralph J. Benko, Editor

The Gold Standard Now
Board of Advisors:

Senior Advisors

Sean Fieler, James Grant,
Steve Hanke, John D. Mueller,
Lawrence Parks, Judy Shelton,
Lawrence H. White

Senior European Advisor
Paul Fabra

Jeffrey Bell, Ralph J. Benko,
Andresen Blom, Frank Cannon,
Rich Danker, Brian Domitrovic,
Charles Kadlec, Christopher K. Potter,
John Tamny and Frank Trotta

In Memoriam
Professor Jacques Rueff

Now Available on Amazon and from The Lehrman Institute

Gold Standard 3-Pack

Three Gold Standard Titles for One Low Price. Only from The Lehrman Institute Store.

Buy from
The Lehrman Institute

Breaking News