Contact: TheAustrians@RocketMail.com
Update June 28, 2009: Mark Thornton of the Mises Institute was kind enough to pass along a collection of his prediction articles foreseeing the housing bubble, rising gold prices, and a declining economy. The first Austrian scholars were predicting the bubble back in 2003. What is the cause of boom-and-bust cycles? Most mainstream Keynsian economists blame the free market for boom-and-bust cycles and prescribe various types of government intervention as the cure. Implicitly or explicitly, this perspective is taught in most American schools and given the most air-time by the major media. The various perspectives we are presented disagree over specific details, but the overall paradigm remains the same. But there is an alternative. The Austrian School of economics explains that it is the government sanctioned (and in the United States' case privately run) central bank that is at the heart of the business cycle. Under the Federal Reserve System, it is legal for banks to increase the money supply on top of the money held in their reserves without a corresponding increase in goods and services, i.e., fractional-reserve banking. Similarly, the Federal Reserve has the power to artificially change the price of borrowing, i.e., artificially alter interest rates. Ultimately, resources are stretched too thin for both consumption and profitable production. This is the true cause of artificial booms and inevitable busts. The Austrians explain that these powers have other negative effects on the economy and society as well: a constantly devaluing dollar, a transfer of wealth to the creators and receivers of the newly created fractional-reserve money such as the banks and the government (constituting a deceitful form of taxation), and even a push towards a corruptive partnership between big government and big banking. This site is intended as both an introduction to the ideas of Austrian economics as well as showing its predictive power. The Austrians were right as this video of Peter Schiff shows. For more information on Austrian economics visit http://www.mises.org as well as our links section. Follow this link, http://www.lewrockwell.com/paul/paul494.html, to read Ron Paul's "The Austrians Were Right" speech given to the House of Representatives.
The Austrian Economists Saw This Crises Coming
Update May 2, 2009: For an in-depth audio presentation of the boom-and-bust cycle, give this presentation by Joseph Solernno a listen.
http://mises.org/multimedia/mp3/Salerno-Klein2007/10-Salerno.mp3
If you prefer to read rather than listen, give this paper by Larry J. Secrest a read.
http://mises.org/journals/qjae/pdf/qjae9_4_4.pdf
And Now They Are Seeing This
What is the future of the American economy according to leading Austrians?
In the first video, Thomas Woods, author of "Meltdown," gives some historical perspective from the Austrian point of view on government intervention in the economy and the implications for the future of America. In the second video, Austrian economist Peter Schiff continues to disagree with current Keynsian policies enacted by Bush and Obama and their coming effects on the economy.
In fact, many Austrians are predicting very different outcomes than their Keynsian counter-parts. Leading Austrians believe...
• In the near future, the dollar is going to be severely devalued and precious metal prices will skyrocket.
• Government intervention (bailouts, price fixing, stimulus packages) will prolong the economic downturn as it did during the great depression. • If policies don't change, the United States will experience massive inflation and unemployment, that is, stagflation.
If they're right, is it too late? No one knows for sure, but the sooner we can change the government's policies the better. This site recommends endorsing Ron Paul's legislation, H.R. 1207 and H.R. 833, to audit and ultimately abolish the Federal Reserve System. Please visit www.campaignforliberty.com as well as www.endthefed.us for more information.
May 28, 2009: Austrians Vs. the Keynsians
What are the Keynsian solutions to the current crises as compared to the Austrian's? Mark Thorton explains in this Mises article. http://mises.org/story/3465
October 8, 2009: The Price of Gold Jumps
Are Peter's predictions starting to come true? Well, the price of gold is at a record high.
