As promised, in this episode of Cantillon Effects, I have considered in much more detail whether there is such a thing as a ‘Consumer’ in isolation? I ask if a person’s role as producer is not more important. I look at the part played by interest rates, capital, and entrepreneurs, as well as by the state. I argue that worship of that False God – the ‘Consumer’ – not only slows economic progress in general and encourages heavy-handed and often harmful policies of intervention but also that it leads directly to the wastefulness of Boom and Bust. [To listen instead to Part I and Part II of my podcast on this, please go to CantillonCH at SoundCloud, or search Apple Podcasts here and here and Spotify for ‘Cantillon Effects’] Continue reading
Tag Archives: bust
Ten Years After
A little over 10 years ago, a hitherto obscure German institution called IKB – majority-owned by an arm of the German government – suddenly made headlines around the world.
On the last day of July 2007, a company which ironically had its origins in a foredoomed effort to ‘stimulate’ the German economy in the aftermath of the Weimar Republic’s disastrous by financing small businesses, but also by partaking of the contemporary, pre-Depression boom in real estate, revealed that, once again, it had been seduced by the lure of a property bubble. [A version of this article appeared as part of the inaugural edition of ETF Stream] Continue reading
Give us another Oil boom
Dear Lord, Y’all give us another oil boom…
If there is one sector of the US economy where an Austrian-style Boom-and-Bust bust has taken place, it is the onshore oil industry – though, by extension, other primary resource industries, such as metals and mining and farming have also suffered in the ongoing aftermath of the general commodity bust.
The Austrian Prescription
At the start of the year it has become wearily traditional for us pundits to offer one of two genres of prediction.
The first takes the form of a genuine—if ultimately foredoomed—attempt to lift a ragged corner of those thick shrouds of unknowability which separate today from tomorrow. The second combines such futility with a certain arch attempt to make one’s name in the event one chances upon what can afterwards be trumpeted as the inspired prediction of what the consensus presently regards as a highly unlikely event. Continue reading
Busts are not ‘inevitable’
There are those who can display a solid grasp of the oft–misunderstood mechanics of credit and money generation by banks and who are also well aware of the episodes of endemic mistakes this entrains in in our system. Yet, perhaps because they possess a certain ideological bent, many such commentators cannot seem to steel themselves to take the next step and admit that very little of this has anything to do with a free market, or that those mistakes are decidely not an intrinsic feature of what they like to call ‘capitalism’.