The Gold Standard 

President Obama chose to deliver his State of the Union address this year on the 204th anniversary of the birth of Abraham Lincoln. It was a good selection of a significant date. As Steven Spielberg makes clear in his epic film "Lincoln," Americans of all backgrounds and political persuasions can learn much from the character and presidency of the 16th president.

With regard to human rights and economic liberty, Lincoln adhered to two fundamental principles. First, that every person was entitled to the fruits of Read more

Who caused the financial collapse? Just about everyone.

To appreciate this landmark work it is necessary to know a bit about the author’s background.

John Allison is not only a banker-entrepreneur; he is also a recognized intellectual leader of American business. Moreover, Allison’s financial expertise is a product of his personal biography: In a mere two decades, he built BB&T (Branch Banking & Trust Co.), a comparatively small Southern bank of $4.5 billion in assets, into a $152-billion financial enterprise, ma Read more

“The problems that exist in the world today cannot be solved by the level of thinking that created them.”
– Albert Einstein

EVERY DAY WE WAKE UP hoping for good economic news: lower unemployment numbers, more jobs created, stronger growth. But we miss the forest for the trees. Our markets, for the past 100 years, have been engulfed in perennial financial crises.

Many of these crises have been associated with major Federal Reserve credit expansions and contractions. Upon examination, these volatile market episodes Read more

Statement and Testimony of Lewis E. Lehrman Chairman, The Lehrman Institute Prepared for September 21, 2012 Hearing

... Now we are able to formulate an authentic, bipartisan program to restore 4 percent American economic growth over the long term. Tax rate reductions with an enlarged tax base, government spending restraint aimed at a balanced budget, simplification of business regulation designed to empower entrepreneurial innovation -- these reforms can be made effective for America and the world by a modernized Read more

Gold, a fundamental, metallic element of the earth’s constitution, exhibits unique properties that enabled it, during two millennia of market testing, to emerge as a universally accepted store of value and medium of exchange, not least because it could sustain purchasing power over the long run against a standard assortment of goods and services. Rarely considered in monetary debates, these natural properties of gold caused it to prevail as a stable monetary standard, the most marketable means by which trading peoples wo Read more

In the absence of government prohibitions and restrictions in favor of inconvertible paper and credit money, history shows that gold—or paper and credit money convertible to gold—was preferred and accepted in trade and exchange from time immemorial.  Until recent times the gold standard also underwrote, indeed required, the trade rebalancing and equilibrium mechanisms of the international economy.  In the absence of prompt balance-of-payments settlements in gold, the undisciplined official reserve currency syst Read more

In 2012, inflation proceeds gradually in the United States because of unemployed resources.  At full employment, inflation accelerates.  But then, as the Fed and the banking system reduce the growth rate of credit, the threat of deflation will reappear (as in 2006-07 and 2012).  Because the reserve currency system generally leads to a rapid increase in global purchasing power without a commensurate increase in the supply of goods and services, the systemic tendency of the reserve currency system is inflation— Read more

Since 1971, the floating, world dollar standard has been even more perverse and crisis-prone than the reserve currency systems of Bretton Woods and of the interwar era.  Indeed, the privilege and the burden of the dollar’s role as the world’s official reserve currency has been a cause not only of extreme inflation and the threat of deflation, but also of industrial and manufacturing displacement in the United States.  The world dollar standard is a primary cause of declining U.S. competitiveness, a witness of w Read more