State of monetary chaos

By all accounts, President Barack Obama will refocus in his 2011 State of the Union address on “jobs and competitiveness.” One must hope he succeeds. But Treasury Secretary Timothy Geithner’s previews strongly suggest that both men are unaware that these two problems are essentially unrelated, and that even with continued economic recovery, Obama won’t propose the two measures that would cut unemployment sharply and start to reverse the decline of U.S. manufacturing: reversing recent extensions of unemployment benefits from 26 to 99 weeks, and negotiating the end of the dollar’s role as chief official reserve currency.  Geithner  regards the first as “stimulus” and the second as unthinkable.

As the chart below shows, the decline in the U.S. overall net investment position by 30% of GDP almost exactly matched the decline in U.S. net monetary reserves (U.S. foreign official assets minus liabilities). Yet by the latest figures, U.S. net private assets were in surplus by about 7% of GDP. This proves that the U.S. loss of competitiveness is entirely due to financing Federal deficits through foreign monetary authorities. The next successful U.S. president will implement both reforms.

netusmonetaryreservesvsinvestmentpostion

Vinaora Nivo SliderVinaora Nivo SliderVinaora Nivo SliderVinaora Nivo Slider

Exclusive Interview With Jerry Bowyer, Part 2

September 1, 2014

An extended interview with Jerry Bowyer: some thoughts on the "rediscovery of a virtuous monetary system."

BOOK REVIEWS

Signs Of The Gold Standard Emerging From Great Britain?

by Ralph Benko

... Given Kwarteng’s current and, likely, future importance to the world monetary discourse it really would be invaluable were he to master the arguments of Jacques Rueff, and of Lewis Lehrman, as well as those of Triffin (who shared the same diagnosis while offering a different prescription).

Read More

 

The Federal Reserve System's James Narron and David Skeie, career officials with the Federal Reserve System, are two eminent historically erudite figures.  Writing in the New York Federal Reserve Bank's online publication, Liberty Street Economics, they recently provided a continuation of their valuable historical "revue," Crisis Chronicles: The Collapse of the...

BLOGS


Paul Krugman's Projection

Ralph J. Benko  |  Jul 14, 2014
On July 6th, Nobel economics laureate and Princeton Professor launched, in the New York Times, one of his occasional polemics, entitled Conservative Delusions About Inflation, against proponents of the gold standard.  Krugman Caricature under creative commons license from DonkeyHotey As usual, Prof. Krugman is, conveniently for the position he takes, beyond lopsided...
VIEW BLOGS
An article headline in Saturday’s Wall Street Journalread “Rate Talk Heats Up Within The Fed.” As Journalreporters Jon Hilsenrath and Michael Derby...
VIEW WORLD NEWS
Feb 21, 2014
Key Monetary Writings
Steve Hanke

The Great Destabilizer

Dr. Karl Schiller, West Germany’s Economics Minister between 1966 and 1972, pithily pronounced that: “Stability is not everything, but without...
VIEW KEY MONETARY WRITINGS
 

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

In Memoriam
Professor Jacques Rueff
(1896-1978)

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