The PIGS Must Go: Flood-Sale Prices!
It’s spring cleaning time and I want to get rid of my inventory. I had bulked up on copies of The Politically Incorrect Guide to Capitalism and The Politically Incorrect Guide to the Great Depression and the New Deal for the April 15 Tea Party deal. Now I’ve got a couple dozen lying around my office. I had toyed with just sitting on them until the July 16-17 extravaganza, but here at Consulting By RPM we practice just-in-time practices.
So if you have always wanted a signed copy of either PIG book, but were waiting for the price to dip, now is your time. For $15 (plus shipping) you can get either book, with whatever personalized message you want. Just shoot me an email with the necessary info, and then I’ll tell you where to send the check.
Orders can still reach you by Memorial Day! Makes a great gift for that special soldier in your life!
And remember, it’s Crazy Bobby’s, where the prices are innnnnnsaaaaaaane.
Rothbard Anecdote
I am tutoring Vaughn Kraft on various Austrian books, and he just sent me this email:
Several libertarians in the 70’s wrote (Browne, Ringer, Tuccille, etc.) about Karl Hess’s wonderful disrespect for the state and his political jaunt through the whole political spectrum. So anyway, as Goldwater’s chief political speechwriter, Barry referred to Hess as Shakespeare—a writer par excellence. Hess and MNR became close friends and Murray taught him Austrian economics over one summer. While I was working in the Libertarian Party during the MacBride campaign of 1976, the LP had a casual party wherein I had the unique opportunity to speak to MNR and ask him questions. Now picture this if you can: next enters the most prolific mind of the 20th century, making his much anticipated entrance down the majestic stairway—all decked out in his faded and jaded flowered Hawaiian shirt, with an 11-cent black BIC pen, clipped to his shirt pocket—all decked out for a typical, casual California summer day. What an entrance!!! How could ANYONE not love the unassuming Rothbard.
Of course, MNR and Hess had parted ways by this time, but I was still enamored by Hess’s radicalism. Well, anyway, I asked MNR what he thought about Hess at this casual event, to which he replied: “Hess had the unique ability of writing things once without having to go back and edit them.” Whoa!!! I knew Hess had super talent, but after what Rothbard had related to me, Karl just hit 10 on my hero-meter scale for the one millionth time. In retrospect, I do agree with Rothbard’s final words as such, as Hess ended up a mere “hippie”. Let’s face it: Hess never landed. He just kept changing his political underwear.
Thanks for indulging me, no response required; just a minor tidbit of my 15 seconds of libertarian fame. Let’s face it: I was quite simply in the presence of Greatness! Just a short and sweet story about Rothbard and Hess that I thought you might appreciate.
It’s On…
Clash of the econogeeks. Bryan Caplan and I apparently have another wager.
UPDATE: Because I fear that my genius is (as usual) being misunderstood, let me do one last iteration on this and I promise I will drop it. In the comments of Bryan’s new post, one of his fans congratulated Bryan on setting me straight on the mathematics of it all, and then said:
“It’s also great to see someone publicly making predictions in advance.”
To which I replied:
Bryan has done nothing courageous of the kind; he’s like Janet Reno taking “full responsibility” for Waco, and then not resigning. He “went out on a limb” and said that if unemployment breaks 8%, he will reevaluate the effectiveness of TARP.
And then, a long time after that daring public proclamation, he thinks it is so obvious that TARP has been a failure, that he chastises bailout proponents for not looking at the lessons of history.
Doesn’t anyone else see a problem with that, or am I taking crazy pills?
Potpourri
* Hinkle calls off the Mann-hunt due to Climategate. (I agree, and HT2 Jerry Taylor.)
* Richard Ebeling sends an interesting email to Robert Wenzel about Machlup’s perspective on booms, back in the 1930s. (BTW, do you wish you could see Richard Ebeling give a fascinating talk in a fun city? Hmm, if only some entrepreneurs would cater to that desire…)
* Von Pepe sends this story of a $540 million suit against the NYPD.
* I liked Arnold Kling’s approach in this blog post, though some of his commenters raised legitimate criticisms.
* A great WSJ piece from Gerald O’Driscoll, who is an extremely interesting and sharp guy. (He mostly hangs out in the comments at ThinkMarkets, except of course when he’s lighting it up on the pages of the WSJ.) The only quibble I have is that I don’t think Austrians should keep saying that Mises predicted communism would fall, and that he was proven right 70 years later. Mises said socialism couldn’t calculate from Day One. I think it miscontrues his argument to say it was an empirical claim about the ability of a socialist regime to stay in power.
* Bryan Caplan has a neat suggestion for different weight classes in prisons. The added benefit is that it would make people watch what they eat! I would be nervous to go to prison right now, but holy cow if I were housed with all the convicts in my weight class from around the country?! I would have to perfect my Barack Obama impression pronto.
Artificially Low Interest Rates Are Bad for the Economy
I don’t know if the Detroit News in general has a “conservative” editorial position, but the opinions editor apparently is a fan of Austrian economics. He ran my piece:
The Federal Reserve and its supporters claim that the unprecedented interventions rescued the financial markets and the housing sector. Also, they point to the moderate consumer price inflation for the past year as evidence that the Fed isn’t “overheating” the economy.
Yet these are exactly the same excuses from the Greenspan era.
It is now obvious that housing prices during the mid-2000s were completely divorced from reality and that the U.S. economy was in an unsustainable dreamland. Five years from now, Americans may look back and think the same was true of 2010.
Printing money to keep zero percent interest rates has never worked long term, will only postpone the inevitable correction, and indeed make another crash more likely.
Gold Hits All Time High
I was listening to Dave Ramsey–whom I love now, by the way, despite his views on whole life–and he was pooh-poohing gold. He said something like, “I look at an investment based on its track record, not on ‘feelings.’ And if you throw out the last 7 seven years, gold has performed just horribly.”
Now Dave’s recommended strategy is to put your money in a mutual fund. Does anyone know how many years back we would need to go, in order for a mutual fund to have outperformed gold as of today? It’s a lot more than 7 years.
No One Takes Caplan Seriously on Bayes Law, Not Even Bryan
Back when TARP was first passed, Bryan Caplan said something that I considered absurd at the time:
Ex ante, though, basic Bayesian reasoning doesn’t allow us to claim that whatever happens confirms our position. If the occurrence of X raises the probability of A, then the occurrence of not-X must reduce the probability of A. See Eliezer’s classic essay.
…
I’ll bite first. If the bail-out happens, and unemployment stays below 8% for the next two years, I’m going to become less confident that the bail-out prevented disaster. After all, even a near-miss with disaster should look pretty ugly. Alternately, if the bail-out happens, and unemployment hits 8% or higher during the next two years, I’m going to become more confident that the bail-out prevented disaster. I still won’t be convinced, but I’ll be less skeptical than I am now.
Because had thus boxed himself in, he was forced to say in March 2009:
Now that unemployment has passed 8%, I now admit to having underestimated the severity of the threat, and marginally reduce my skepticism about the effectiveness of the bail-out. I still think it’s a bad idea, but at least it’s no longer much ado about nothing.
I’m not going to walk you through the specific flaws in Bayes’ Law that he (must) have made. Just try a different example: A guy says, “You have a fever? Take my special blend of rat poison as medicine!” Then the guy takes it and his fever goes up. Bryan says, “Hmm, my a priori hunch was that rat poison wouldn’t help, but man, it turns out this guy was on his deathbed after all! I’ll need to reevaluate my initial skepticism.”
OK but it’s good to see that Bryan actually now (apparently) thinks that when the economy kept getting worse, even after the TARP and stimulus, that that was prima facie evidence that free-market economic theory is right. Today he writes:
I’ve been against bail-outs from the beginning. So should have all economists. It’s reasonable to debate the merits of contracyclical monetary policy. It’s not reasonable to debate the merits of rewarding failure on a grand scale.
Alas, in “practical politics” almost no one’s interested in figuring out whether we took the wrong course two years ago. Instead, it’s all about the latest crisis – and the next crisis on the horizon. It really does seem like the crises just keep getting bigger: Wall St., Greece, then what? Italy?
Gold Flirting With All-Time High
News here.
As Robert Wenzel pointed out, the day of the Greece bailout announcement, gold actually dipped. That made no sense, at least from a “fundamental” viewpoint. If I subscribed to conspiracy theories, I would say the plunge protection team dumped a bunch of gold futures to push down the gold price at least the day of the announcement, to maintain some face, but now they can’t hold back the flood.
In any event, I have never regretted telling Free Advice readers to stock up on physical gold and silver coins. My warnings of price inflation in general have yet to come to fruition, but you have done OK if you followed my actual recommendations.
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