Quotulatiousness

November 10, 2018

Hitler’s Beer Hall Disaster I BETWEEN 2 WARS I 1923 Part 1 of 2

Filed under: Germany, History, Military — Tags: , , , , , , — Nicholas @ 10:34

TimeGhost History
Published on 10 Nov 2018

When Germany spirals into hyperinflation and the French occupy the Ruhr, Adolf Hitler and Erich Ludendorff make a grab for power.

Join us on Patreon: https://www.patreon.com/TimeGhostHistory

Hosted by: Indy Neidell
Written and directed by: Spartacus Olsson
Writing and Research Contributed by: Rune V. Hartvig
Produced by: Astrid Deinhard
Executive Producers: Bodo Rittenauer, Astrid Deinhard, Indy Neidell, Spartacus Olsson

Archive by Screenocean/Reuter https://www.screenocean.com

A TimeGhost chronological documentary produced by OnLion Entertainment GmbH

And from the comments:

We jump ahead briefly to 1923 as this week is the anniversary of the Hitlerputsch and the Georg Elser Bomb in 1939. We will return to part 4 of 1920 in shortly. Many thanks to Rune V. Hartvig for contributing to the writing of this episode.

READ BEFORE YOU COMMENT: This episode was recorded before we had our studio, therefore our the sound is not great. Also READ OUR RULES:

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Thanks for reading, and now…. let’s make history!

October 28, 2018

QotD: Revolutionary price controls and the plight of Washington’s army at Valley Forge

Filed under: Economics, History, Quotations, USA — Tags: , , , , , , — Nicholas @ 01:00

By the end of 1775, Congress had already increased the nation’s money supply by 50 percent in less than a year, and state paper issues had already begun in New England. The Congressional Continental bills followed what was to become a sequence all too familiar in the western world: runaway inflation. As paper money issues flooded the market, the dilution of the value of each dollar caused prices in terms of paper money to increase; since this included the prices of gold, silver, and foreign currencies, the value of the paper money declined in comparison to them. As usual, rather than acknowledge the inevitability of this sequence, the partisans of inflationary policies urged further accelerated paper issues to overcome the higher prices and searched for scapegoats to blame for the price rise and depreciation. The favorite scapegoats were merchants and speculators who persisted in doing the only thing they ever do on the market: they followed the push and pull of supply and demand. In another familiar attempt to deal with the problems of inflationary intervention, they outlawed the depreciation of paper, or the rise of prices.

[…]

State and local governments presumed to know what market prices of the various commodities should be, and laid down price regulations for them. Wage rates, transportation rates, and prices of domestic and imported goods were fixed by local authorities. Refusing to accept paper, accepting them for less than par, charging higher prices than allowed, were made criminal acts, and high penalties were set: they included fines, public exposure, confiscation of goods, tarring and feathering, and banishment from the locality. Merchants were prohibited from speculating, and thereby from bringing the needed scarce goods to the public. Enforcement was imposed by zealots in local and nearby committees, in a despotic version of the revolutionary tradition of government by local committees.

Price controls made matters far worse for everyone, especially the hapless Continental Army, since farmers were thereby doubly penalized: they were forced to sell supplies to the army at prices far below the market and they had to accept increasingly worthless Continentals in payment. Hence, they understandably sold their wares elsewhere; in many cases, they went “on strike” against the whole crazy-quilt system by retiring from the market altogether and raising only enough food to feed themselves and their own families. Others reverted to simple barter.

Murray N. Rothbard, Conceived In Liberty, Volume IV, 1979.

October 21, 2018

This is why Keynesianism doesn’t work in practice – the politicians flub the hard part

Filed under: Economics, Government, Politics — Tags: , , — Nicholas @ 03:00

Tim Worstall explains the fatal flaw in Keynes’ economic theory … not so much in the theory part, but in the practical application by flesh-and-blood human beings:

We’re told that government borrowing is falling, the deficit closing. This therefore means that it’s possible to relax austerity, to start spending more upon sweeties for the voters. This being exactly and precisely why Keynesianism as a practical matter doesn’t work. For politicians will follow the fun bit and not the difficult part. Thus as an overall theory it simply is, to use a governmental phrase, no longer operative.

[…]

Think of what that basic Keynesian idea is. When the economy’s in the doldrums we should blow out the deficit in order to increase demand and thus boost the economy. But when we’re running at the resource limit then any such attempts will just turn up as inflation. So, we should stop doing that. Also, as Keynes himself pointed out, when the Sun shines is the time to repair the roof. Perhaps pay down some of that national debt so that the next time we need to blow that deficit out we’ve got space to do so.

Do note that this basic set up is also entirely consistent with modern monetary theory. When the economy is running at its limits then we should be taxing more of that created money back to prevent inflation. That is, running a smaller budget deficit, possibly even a surplus.

So, what happens to kill either theory in reality? Well, here we are. Unemployment at its lowest since the early 1970s. Employment to population ratio at its highest since then. And what are people talking about? Blowing out the deficit again to buy sweeties for voters. That is, the political imperatives just don’t militate in favour of anyone using these theories as they’re supposed to work.

In the meantime, of course, we’ve effectively changed the meaning of the word “austerity“:

Austerity is a political-economic term referring to policies that aim to reduce government budget deficits through spending cuts, tax increases, or a combination of both. Austerity measures are used by governments that find it difficult to pay their debts. The measures are meant to reduce the budget deficit by bringing government revenues closer to expenditures, which is assumed to make the payment of debt easier. Austerity measures also demonstrate a government’s fiscal discipline to creditors and credit rating agencies.

To a modern politician — or political activist — “austerity” now means something more like “only spending a bit more this year than you did last year”. British commentators have been accusing the government’s “austerity” measures for all kinds of negative effects, yet there have been no large scale austerity measures brought in.

October 13, 2018

Why Governments Create Inflation

Filed under: Economics, Government — Tags: , , , — Nicholas @ 02:00

Marginal Revolution University
Published on 14 Feb 2017

Inflation can carry with it quite a few costs. But some governments, like Zimbabwe under President Robert Mugabe in the early 2000s, will go out of their to way to create inflation. Why?

Well, in the Zimbabwe example, the government printed the money and used it to buy goods and services. The ensuing hyperinflation acted as a tax that transferred wealth from the citizens to the government.

However, this is a fairly uncommon reason. Inflation doesn’t make for a good tax and it’s a last resort for desperate governments that are otherwise unable to raise funds.

There are other benefits to inflation that would make governments want to create it. In the short run, inflation can actually boost economic output. However, as we’ve previously covered, an increase in the money supply leads to an equal increase in prices in the long run.

If there’s a recession, governments might create inflation to spur productivity and ease the economic downturn. However, this type of inflationary boosting can be abused. Long-term boosting causes people to simply expect and prepare for it.

Reducing inflation is also costly. If the process is reversed and the growth in the money supply decreases, we get disinflation. Unemployment will likely increase in the short run and an economy can go through a recession. But in the long run, prices will adjust as well.

Inflation can be a neat trick for governments to boost productivity in an economy. But it can easily get out of hand and has even been likened to a drug. Once you start, you need more and more. And stopping is awfully painful as the economy shrinks.

This concludes our section on Inflation and the Quantity Theory of Money. Up next in Principles of Macroeconomics, we’ll be digging into Business Fluctuations.

October 2, 2018

Costs of Inflation: Financial Intermediation Failure

Filed under: Economics — Tags: , , , — Nicholas @ 02:00

Marginal Revolution University
Published on 7 Feb 2017

In the previous video, we learned that inflation can add noise to price signals resulting in some costly mistakes from price confusion and money illusion. Now, we’ll look at how it can interfere with long-term contracting with financial intermediaries.

Let’s say you want to take out a big loan, such as a mortgage on a house. The financial intermediary (in this case, a commercial bank) is going to charge you an interest rate as their profit for loaning you the money. In this situation, inflation has the potential to work against you or it can work against the bank.

If the bank charges you a nominal interest rate (i.e., the interest rate on paper before taking inflation into account) of 5% and inflation climbs unexpectedly to 10% for the year, the real interest rate (nominal minus inflation) falls to -5%. The bank actually loses money. However, if inflation has been higher and banks are charging 15% for mortgages and inflation rates fall unexpectedly to 3%, you’re stuck paying a real interest rate of 12%!

The above scenarios are similar to what actually happened in the United States in the 1960s and 1970s. Inflation was low in the 60s. But then in 70s, inflation rates climbed up unexpectedly. People that purchased a home in the 60s lucked out with low interest rates on their mortgages coupled with higher inflation, and many were able to pay off the loans more quickly than expected. But anyone that purchased a higher interest rate mortgage in the 70s only saw inflation fall back down. It was good for the banks and a costly choice for the homeowners. They were saddled with a high-interest mortgage while lower inflation meant a lower increase in wages.

It’s not that the people buying homes in the 1960s were smarter than those in the 70s. As we’ve noted in previous videos, inflation can be very difficult to predict. When banks expect that inflation might be 10% in the coming years, they will generally adjust their nominal interest rates in order to achieve the desired real interest rate. This relationship between real and nominal interest rates and inflation is known as the Fisher effect, after economist Irving Fisher.

We can see the Fisher effect in the data for nominal interest rates on U.S. mortgages from the 1960s through today. As inflation rates rise, nominal interest rates try to keep up. And as the inflation rates fall, nominal interest rates trail behind.

Now, if inflation rates are both high and volatile, lending and borrowing gets scary for both sides. Long-term contracts like mortgages become more costly for everyone with much higher risk, so it happens less. This is damaging for an economy. Coordinating saving and investment is an important function of the market. If high and volatile inflation is making that inefficient and less common, total wealth declines.

Up next, we’ll explore why governments create inflation in the first place.

September 6, 2018

Costs of Inflation: Price Confusion and Money Illusion

Filed under: Economics — Tags: , , — Nicholas @ 04:00

Marginal Revolution University
Published on 2 Feb 2017

The inflation rate can be somewhat volatile and unpredictable. For example, let’s take the period between 1964 and 1983 in the U.S. The inflation rate jumped around from 1.3% in 1964 to 5.9% in 1970, and all the way up to 14% in in 1980, before dipping back down to 3% in 1983. These dramatic changes, though still fairly mild in the realm of inflation, caught people off-guard.

Peru’s inflation rates in the late 1980s through the early 1990s were on even more of a rollercoaster. Clocking in at 77% in 1986, its inflation rate was already quite high. But by 1990, it had jumped to 7,500%, only to fall to 73% a mere two years later.

High and volatile inflation rates can wreak havoc on the price system where prices act as signals. If the price of oil rises, it signals scarcity of that product and allows consumers to search for alternatives. But with high and volatile inflation, there’s noise interfering with this price signal. Is oil really more scarce? Or are prices simply rising? This leads to price confusion – people are unsure of what to do and the price system is less effective at coordinating market activity.

Money illusion is another problem associated with inflation. You’ve likely experienced this yourself. Think of something that you’ve noticed has gotten more expensive over the course of your lifetime, such as a ticket to the movies. Is it really that going out the movies has become a pricier activity, or is it the result of inflation? It’s difficult for us to make all of the calculations to accurately compare rising costs. This is known as “money illusion” – or when we mistake a change in the nominal price with a change in the real price.

Inflation, especially when it’s high and volatile, can result in some costly problems for everyone. Next up, we’ll look at how it redistributes wealth and can break down financial intermediation.

August 20, 2018

Causes of Inflation

Filed under: Economics — Tags: , , , , , — Nicholas @ 02:00

Marginal Revolution University
Published on 24 Jan 2017

In the last video, we learned the quantity theory of money and its corresponding identity equation: M x V = P x Y

For a quick refresher:

‌•M is the money supply.

‌•V is the velocity of money.

‌•P is the price level.

‌•And Y is the real GDP.

In this video, we’re rewriting the equation slightly to divide both sides by Y and explore the causes behind inflation. What we discover is that a change in P has three possible causes – changes in M, V, or Y.

You probably know that prices can change a lot, even over a short period of time.

Y, or real GDP, tends to change rather slowly. Even a seemingly small jump or fall in Y, such as 10% in a year, would signal astonishing economic growth or a great depression. Y probably isn’t our usual culprit for inflation.

V, or the velocity of money, also tends to be rather stable for an economy. The average dollar in the United States has a velocity of about 7. That may fall or rise slightly, but not enough to influence prices.

That leaves us with M. Changes in the money supply are the driving factor behind inflation. Put simply, when more money chases the same amount of goods and services, prices must rise.

Can we put this theory to the test? Let’s look at some real-world examples and see if the quantity theory of money holds up.

In Peru in 1990, hyperinflation came into full swing. If we track the growth rate of the money supply to the growth rate of prices, we can see that they align almost perfectly on a graph with both clocking in around 6,000% that year.

If we plot the growth rates of the money supply along with the growth rates of prices for a many countries over a long stretch of time, we can see the same relationship.

We’ll wrap-up the causes of inflation with three principles to keep in mind as we continue exploring this topic: ‌

•Money is neutral in the long run: a doubling of the money supply will eventually mean a doubling of the price level.
‌•“Inflation is always and everywhere a monetary phenomena.” – Milton Friedman ‌
•Central banks have significant control over a nation’s money supply and inflation rate.

July 20, 2018

Fiat currency and the impact of cryptocurrencies

Filed under: Economics, Government, Technology — Tags: , , , , — Nicholas @ 03:00

At Catallaxy Files, Sinclair Davidson explains some of the advantages and disadvantages of both fiat (government-issued) and private currency:

As George Selgin, Larry White and others have shown, many historical societies had systems of private money — free banking — where the institution of money was provided by the market.

But for the most part, private monies have been displaced by fiat currencies, and live on as a historical curiosity.

We can explain this with an ‘institutional possibility frontier’; a framework developed first by Harvard economist Andrei Shleifer and his various co-authors. Shleifer and colleagues array social institutions according to how they trade-off the risks of disorder (that is, private fraud and theft) against the risk of dictatorship (that is, government expropriation, oppression, etc.) along the frontier.

As the graph shows, for money these risks are counterfeiting (disorder) and unexpected inflation (dictatorship). The free banking era taught us that private currencies are vulnerable to counterfeiting, but due to competitive market pressure, minimise the risk of inflation.

By contrast, fiat currencies are less susceptible to counterfeiting. Governments are a trusted third party that aggressively prosecutes currency fraud. The tradeoff though is that governments get the power of inflating the currency.

The fact that fiat currencies seem to be widely preferred in the world isn’t only because of fiat currency laws. It’s that citizens seem to be relatively happy with this tradeoff. They would prefer to take the risk of inflation over the risk of counterfeiting.

One reason why this might be the case is because they can both diversify and hedge against the likelihood of inflation by holding assets such as gold, or foreign currency.

The dictatorship costs of fiat currency are apparently not as high as ‘hard money’ theorists imagine.

Introducing cryptocurrencies

Cryptocurrencies significantly change this dynamic.

Cryptocurrencies are a form of private money that substantially, if not entirely, eliminate the risk of counterfeiting. Blockchains underpin cryptocurrency tokens as a secure, decentralised digital asset.

They’re not just an asset to diversify away from inflationary fiat currency, or a hedge to protect against unwanted dictatorship. Cryptocurrencies are a (near — and increasing) substitute for fiat currency.

This means that the disorder costs of private money drop dramatically.

In fact, the counterfeiting risk for mature cryptocurrencies like Bitcoin is currently less than fiat currency. Fiat currency can still be counterfeited. A stable and secure blockchain eliminates the risk of counterfeiting entirely.

July 17, 2018

Measuring Inflation

Filed under: Economics — Tags: , , — Nicholas @ 02:00

Marginal Revolution University
Published on 10 Jan 2017

Inflation is common in a modern economy. Shifts in supply and demand for goods and services cause prices to change accordingly. When the average level of prices rises, that’s inflation. It means that you’ll need more money to purchase the same stuff.

Inflation in the United States can be measured using the Bureau of Labor Statistics’ Consumer Price Index (CPI) – a weighted average of the price increases. We can calculate the inflation rate by the percentage change in the CPI over a given period of time.

How much do prices actually change? Well, using FRED, we can see that, over the past thirty-three years, prices have more than doubled. That may seem like a lot. However, wages have also risen, on average, by more than prices during that time period. Inflation doesn’t necessarily mean that we’re worse off.

The inflation rate in the United States has averaged at about 2.5% per year since 1980, which is fairly low and indicative of a stable economy. Prices may be increasing, but the changes are small. Wages have time to catch up. You can be confident that the $5 in your pocket isn’t going to be worth drastically less in a year.

Let’s take a look at a different scenario — one that’s playing in Venezuela right now. As the country faces an economic crisis, inflation is skyrocketing. Rates reached 180% in 2015 and have continued to rise since. 5 bolívar in your pocket could be worth less even by the end of the day.

But Venezuela still doesn’t compare to the hyperinflation that Zimbabwe experienced in the 2000s, reaching dizzying rates of billions of a percent per month. (See MRU’s previous video for more!)

While some inflation is perfectly normal, high rates of inflation make it difficult for consumers to use a nation’s currency. If the value is changing a lot by the week, day, or even minute, people don’t want to hold onto or accept the currency for goods and services — leading to a full blown currency crisis.

Up next, we’ll take a deeper dive into what causes inflation and its consequences.

July 14, 2018

Trump’s tariffs are working

Filed under: Business, Economics, Government, Politics, USA — Tags: , , — Nicholas @ 03:00

Tim Worstall explains that the recent US price hikes in washing machines is exactly what the Trump administration wanted:

The part of import tariffs that all too many fail to understand is that it is consumers being “protected” by them who actually pay them. That is, import tariffs on foreign goods entering the United States are paid by those inside the United States. Or, as we can also put it, Trump’s tariffs are making Americans poorer. This isn’t a known to be desired effect of economic policy.

However, it’s important to note that the real burden doesn’t come from the rise in price of the imports. It’s what the domestic producers do to us all in the absence of that foreign competition which is important:

The clear and obvious effect of import tariffs – Credit, BLS, via Mark Perry and AEI, by permission

    If you’re unfortunate enough to be shopping for a new washing machine, you can thank the Trump tariffs on imported washing machines, washing machine parts, steel and aluminum for the largest three-month price increase — 16.4% from February to May this year — in the 40-year history of the BLS series for Major Appliances: Laundry Equipment that started in January 1978 (see chart above). In the May CPI report (see Table 2), the one-month increase in the CPI for Laundry Equipment of 7.4% in May followed a 9.6% increase in April, and in both months was the largest monthly price increase of any of the 300 individual CPI categories or sub-categories. For the month of May, the 7.4% increase in the washing machine series was twice the increase of the next highest increase of 3.7% for educational books and supplies (mostly college textbooks).

What’s worse than this price rise is that this is planned. This is the desired outcome from the people who imposed these taxes.

July 7, 2018

Zimbabwe and Hyperinflation: Who Wants to Be a Trillionaire?

Filed under: Africa, Economics, Government, History — Tags: , , , — Nicholas @ 02:00

Marginal Revolution University
Published on 3 Jan 2017

How would you like to pay $417.00 per sheet of toilet paper?

Sound crazy? It’s not as crazy as you may think. Here’s a story of how this happened in Zimbabwe.

Around 2000, Robert Mugabe, the President of Zimbabwe, was in need of cash to bribe his enemies and reward his allies. He had to be clever in his approach, given that Zimbabwe’s economy was doing lousy and his people were starving. Sow what did he do? He tapped the country’s printing presses and printed more money.

Clever, right?

Not so fast. The increase in money supply didn’t equate to an increase in productivity in the Zimbabwean economy, and there was little new investment to create new goods. So, in effect, you had more money chasing the same goods. In other words, you needed more dollars to buy the same stuff as before. Prices began to rise — drastically.

As prices rose, the government printed more money to buy the same goods as before. And the cycle continued. In fact, it got so out of hand that by 2006, prices were rising by over 1,000% per year!

Zimbabweans became millionaires, but a million dollars may have only been enough to buy you one chicken during the hyperinflation crisis.

It all came crashing down in 2008 when — given that the Zimbabwean dollar basically ceased to exist — Mugabe was forced to legalize transactions in foreign currencies.

Hyperinflation isn’t unique to Zimbabwe. It has occurred in other countries such as Yugoslavia, China, and Germany throughout history. In future videos, we’ll take a closer look at inflation and what causes it.

November 5, 2017

The decline of the (western) Roman empire

Filed under: Economics, Europe, History — Tags: , , , , — Nicholas @ 03:00

Richard Blake considers some of the popular explanations for the slow decline of the Roman empire in the west:

The Empire was an agglomeration of communities which were illiterate to an extent unknown in Western Europe since about 1450. Even most officers in the bureaucracy were at best semi-literate. There was no printing press. Writing materials were very expensive – one sheet of papyrus cost about £100 in today’s money. Cheaper materials were still expensive and were of little use for other than ephemeral use. Central control was usually notional, and the more effective Emperors – Hadrian, Diocletian, et al – were those who spent much of their time touring the Empire to supervise in person.

The economic legislation of the Emperors was largely unenforceable. Some effort was made to enforce the Edict of Maximum Prices. But this appears to have been sporadic, and it lasted only between 301 and 305, when Diocletian abdicated. The Edict’s main effect was to leave a listing of relative prices for economic historians to study 1,500 years later.

As for inflation, it can be doubted how far outside the cities a monetary economy existed. This is not to doubt whether the laws of supply and demand operated, only whether most transactions were not by barter at more or less customary ratios of exchange. This being so, the debasement of the silver coinage would have had less disruptive effect than the silver inflation in Europe of the sixteenth century. Also, the gold coinage was stabilised over a hundred years before the Western military collapse of the fifth century. And the military crisis of the late third century was overcome while the inflation continued.

Nor is there any evidence that people left the cities in large numbers for the countryside. The truth seems to be that the Roman Empire was afflicted, from the middle of the second century, by a series of epidemic plagues, possibly brought on by global cooling, that sent populations into a decline that continued until about the eighth century. The cities shrank not because their inhabitants left them, but because they died. So far as they were enforced, the Imperial responses to population decline made things worse, but were not the ultimate cause of decline. Where population decline was less severe, there was no economic decline. Whenever the decline went into temporary reverse – as it may have in the fifth century in the East – economic activity recovered.

Von Mises is right that the barbarian invasions were not catastrophic floods that destroyed everything in their path. They were incursions by small bands. What made them irreversible was that they took place in the West into a demographic vacuum that would have existed regardless of what laws the Emperors made.

February 23, 2017

Words & Numbers: The CBO Can’t Count

Filed under: Economics, Government, USA — Tags: , , — Nicholas @ 04:00

Published on 22 Feb 2017

In this episode, Dr. Antony Davies, Professor of Economics of Duquesne University in Pittsburgh, and Dr. James R. Harrigan, Senior Research Fellow at Strata, in Logan, Utah discuss the way the Congressional Budget Office works, and outline its history of failure at accurately forecasting increases in the national debt.

Find out more about the CBO and debt projections here:
https://fee.org/articles/the-congressional-budget-office-cant-count

here:
http://www.usnews.com/opinion/economic-intelligence/articles/2017-02-01/the-cbo-federal-budget-predictions-are-dangerously-optimistic

and here:
http://www.huffingtonpost.com/entry/58a0810be4b0e172783a9daa

Plus, check out this great 360 Video from Learn Liberty with Antony Daves that helps put the massive scale of the current US Federal debt into perspective: https://www.youtube.com/watch?v=ErUZjM16r1M

And track the National Debt in real time here:
http://www.usdebtclock.org/

February 19, 2017

Nominal vs. Real GDP

Filed under: Economics — Tags: , , , , — Nicholas @ 03:00

Published on 19 Nov 2015

“Are you better off today than you were 4 years ago? What about 40 years ago?”

These sorts of questions invite a different kind of query: what exactly do we mean, when we say “better off?” And more importantly, how do we know if we’re better off or not?

To those questions, there’s one figure that can shed at least a partial light: real GDP.

In the previous video, you learned about how to compute GDP. But what you learned to compute was a very particular kind: the nominal GDP, which isn’t adjusted for inflation, and doesn’t account for increases in the population.

A lack of these controls produces a kind of mirage.

For example, compare the US nominal GDP in 1950. It was roughly $320 billion. Pretty good, right? Now compare that with 2015’s nominal GDP: over $17 trillion.

That’s 55 times bigger than in 1950!

But wait. Prices have also increased since 1950. A loaf of bread, which used to cost a dime, now costs a couple dollars. Think back to how GDP is computed. Do you see how price increases impact GDP?

When prices go up, nominal GDP might go up, even if there hasn’t been any real growth in the production of goods and services. Not to mention, the US population has also increased since 1950.

As we said before: without proper controls in place, even if you know how to compute for nominal GDP, all you get is a mirage.

So, how do you calculate real GDP? That’s what you’ll learn today.

In this video, we’ll walk you through the factors that go into the computation of real GDP.

We’ll show you how to distinguish between nominal GDP, which can balloon via rising prices, and real GDP—a figure built on the production of either more goods and services, or more valuable kinds of them. This way, you’ll learn to distinguish between inflation-driven GDP, and improvement-driven GDP.

Oh, and we’ll also show you a handy little tool named FRED — the Federal Reserve Economic Data website.

FRED will help you study how real GDP has changed over the years. It’ll show you what it looks like during healthy times, and during recessions. FRED will help you answer the question, “If prices hadn’t changed, how much would GDP truly have increased?”

FRED will also show you how to account for population, by helping you compute a key figure: real GDP per capita. Once you learn all this, not only will you see past the the nominal GDP-mirage, but you’ll also get an idea of how to answer our central question:

“Are we better off than we were all those years ago?”

December 8, 2016

The History of Paper Money – VI: The Gold Standard – Extra History

Filed under: Economics, History, WW1 — Tags: , , , — Nicholas @ 04:00

Published on Nov 5, 2016

Even as the use of paper money grew, ties to the gold standard remained… and remained challenging. From the First Opium War to the Great Depression, events around the world stretched the capacity of bullion based economics. So what – and who – finally abandoned it?

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