Vortex Mulligan : the market for media of exchange

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Vortex Mulligan : the market for media of exchange

				click triangles and ••• links — December 25, 2009, 3 pm MDT

				The Cobden Centre - founded (I think, -leif) June 2009 •••

				"Bastiat's Iceberg," a fascinating article on economic crisis, recommended by The Cobden Center (for honest money and social progress). Toby Baxendale, at The Cobden Center •••, on 21 December 09, writes: "Sean Corrigan of Diapason Commodities Management packs more sound applied economics into this report than ever: Toby Baxendale provides a commentary." Download the report here. [1.6 MB pdf] — This is one of the few analyses I've seen that employs Hayek's time-conscious structure of production in explanation of the monetary causes of economic crisis. -leif

				Cobden Centre seems to have an interest in the work of Jesús Huerta de Soto, as do we (see below).

				Bin of recently found stuff - what do you think of all this? - I have not read it yet -leif

				Hülsmann's Ethics of Money Production

				http://mises.org/store/Ethics-of-Money-Production-P536.aspx

				Sean Corrigan - writings

				http://www.lewrockwell.com/corrigan/corrigan-arch.html

				http://mises.org/articles.aspx?AuthorId=502

				"Twilight of the Gods" http://mises.org/daily/2706

				Books on Money and Banking by Murray N. Rothbard

				What Has Government Done to Our Money

				The Mystery of Banking

				The Panic of 1819: Reactions and Policies

				A History of Money and Banking in the United States: The Colonial Era to World War II

				The U.S. Financial Crisis of September 2008

				Llewellyn H. Rockwell — 20 September 2008: Understanding the Crisis [link]

				Anthony Mueller — 18 September 2008: What's Behind the Financial Market Crisis? [link]

				Articles by Anthony Mueller on Mises Institute site [link]

				Jesús Huerta de Soto — Professor of Political Economy, King Juan Carlos University of Madrid, Spain

				http://www.jesushuertadesoto.com/

				Money, Bank Credit, and Economic Cycles

				A brief description of the book, and a complete outline

				Taken from: http://www.mises.org/store/product.aspx?ProductID=290 Can the market fully manage the money and banking sector? Jesús Huerta de Soto, professor of economics at the Universidad Rey Juan Carlos, Madrid, has made history with this mammoth and exciting treatise that it has and can again, without inflation, without business cycles, and without the economic instability that has characterized the age of government control. Such a book as this comes along only once every several generations: a complete comprehensive treatise on economic theory. It is sweeping, revolutionary, and devastating--not only the most extended elucidation of Austrian business cycle theory to ever appear in print but also a decisive vindication of the Misesian-Rothbardian perspective on money, banking, and the law. Jörg Guido Hülsmann has said that this is the most significant work on money and banking to appear since 1912, when Mises's own book was published and changed the way all economists thought about the subject. Its five main contributions: • a wholesale reconstruction of the legal framework for money and banking, from the ancient world to modern times, • an application of law-and-economics logic to banking that links microeconomic analysis to macroeconomic phenomena, • a comprehensive critique of fractional-reserve banking from the point of view of history, theory, and policy, • an application of the Austrian critique of socialism to central banking, • the most comprehensive look at banking enterprise from the point of view of market-based entrepreneurship. Those are the main points but, in fact, this only scratches the surface. Indeed, it would be difficult to overestimate the importance of this book. De Soto provides also a defense of the Austrian perspective on business cycles against every other theory, defends the 100% reserve perspective from the point of view of Roman and British law, takes on the most important objections to full reserve theory, and presents a full policy program for radical reform. It was Hülsmann's review of the Spanish edition that inspired the translation that led to this Mises Institute edition in English. The result is astonishing: an 875-page masterpiece that utterly demolishes the case for fiat currency and central banking, and shows that these institutions have compromised economic stability and freedom, and, moreover, are intolerable in a free society. De Soto has set new scholarly standards with this detailed discussion of monetary reform from an Austro-libertarian point of view. Huerta de Soto’s solid elaboration of his arguments along these lines makes his treatise a model illustration of the Austrian approach to the study of the relationship between law and economics. It could take a decade for the full implications of this book to be absorbed but this much is clear: all serious students of these subject matters will have to master this treatise. 875 page hardback CONTENTS • Preface to the English-Language Edition • Preface to the Second Spanish Edition • Introduction Chapter 1: The Legal Nature of the Monetary Irregular-Deposit Contract • A Preliminary Clarification of Terms: Loan Contracts (Mutuum and Commodatum)and Deposit Contracts • The Commodatum Contract • The Mutuum Contract • The Deposit Contract • The Deposit of Fungible Goods or "Irregular" Deposit Contract • The Economic and Social Function of Irregular Deposits • The Fundamental Element in the Monetary Irregular Deposit • Resulting Effects of the Failure to Comply with the Essential Obligation in the Irregular Deposit • Court Decisions Acknowledging the Fundamental Legal Principles which Govern the Monetary Irregular-Deposit Contract (100-Percent Reserve Requirement) • The Essential Differences Between the Irregular Deposit Contract and the Monetary Loan Contract • The Extent to Which Property Rights are Transferred in Each Contract • Fundamental Economic Differences Between the Two Contracts  Fundamental Legal Differences Between the Two Contracts • The Discovery by Roman Legal Experts of the General Legal Principles Governing the Monetary Irregular-Deposit Contract • The Emergence of Traditional Legal Principles According to Menger, Hayek and Leoni • Roman Jurisprudence • The Irregular Deposit Contract Under Roman Law Chapter 2: Historical Violations of the Legal Principles Legal Principles Governing the Monetary Irregular-Deposit Contract • Introduction • Banking in Greece and Rome • Trapezitei, or Greek Bankers • Banking in the Hellenistic World • Banking in Rome • The Failure of the Christian Callistus's Bank • The Societates Argentariae • Bankers in the Late Middle Ages • The Revival of Deposit Banking in Mediterranean Europe • The Canonical Ban on Usury and the "Depositum Confessatum" • Banking in Florence in the Fourteenth Century • The Medici Bank • Banking in Catalonia in the Fourteenth and Fifteenth Centuries: The Taula de Canvi • Banking During the Reign of Charles V and the Doctrine of the School of Salamanca • The Development of Banking in Seville • The School of Salamanca and the Banking Business • A New Attempt at Legitimate Banking: The Bank of Amsterdam. • Banking in the Seventeenth and Eighteenth Centuries • The Bank of Amsterdam • David Hume and the Bank of Amsterdam • Sir James Steuart, Adam Smith and the Bank of Amsterdam • The Banks of Sweden and England • John Law and Eighteenth-Century Banking in France • Richard Cantillon and the Fraudulent Violation of the Irregular-Deposit Contract Chapter 3: Attempts to Legally Justify Fractional-Reserve Banking • Introduction • Why it is Impossible to Equate the Irregular Deposit with the Loan or Mutuum Contract • The Roots of the Confusion • The Mistaken Doctrine of Common Law • The Doctrine of Spanish Civil and Commercial Codes • Criticism of the Attempt to Equate the Monetary Irregular-Deposit Contract with the Loan or Mutuum Contract • The Distinct Cause or Purpose of Each Contract • The Notion of the Unspoken or Implicit Agreement • An Inadequate Solution: The Redefinition of the Concept of Availability • The Monetary Irregular Deposit, Transactions with a Repurchase Agreement and Life Insurance Contracts • Transactions with a Repurchase Agreement • The Case of Life Insurance Contract Chapter 4: The Credit Expansion Process • Introduction • The Bank's Role as a True Intermediary in the Loan Contract • The Bank's Role in the Monetary Bank-Deposit Contract • The Effects Produced by Bankers' Use of Demand Deposits: The Case of an Individual Bank • The Continental Accounting System • Accounting Practices in the English-speaking World • An Isolated Bank's Capacity for Credit Expansion and Deposit Creation • The Case of a Very Small Bank • Credit Expansion and Ex Nihilo Deposit Creation by a Sole, Monopolistic Bank • Credit Expansion and New Deposit Creation by the Entire Banking System • Creation of Loans in a System of Small Banks • A Few Additional Difficulties • When Expansion is Initiated Simultaneously by All Banks • Filtering Out the Money Supply From the Banking System • The Maintenance of Reserves Exceeding the Minimum Requirement • Different Reserve Requirements for Different Types of Deposits • The Parallels Between the Creation of Deposits and the Issuance of Unbacked Banknotes • The Credit Tightening Process Chapter 5: Bank Credit Expansion and Its Effects on the Economic System • The Foundations of Capital Theory • Human Action as a Series of Subjective Stages • Capital and Capital Goods • The Interest Rate • The Structure of Production • Some Additional Considerations • Criticism of the Measures used in National Income Accounting • The Effect on the Productive Structure of an Increase in Credit Financed under a Prior Increase in Voluntary Saving • The Three Different Manifestations of the Process of Voluntary Saving • Account Records of Savings Channeled into Loans • The Issue of Consumer Loans • The Effects of Voluntary Saving on the Productive Structure • First: The Effect Produced by the New Disparity in Profits Between the Different Productive Stages • Second: The Effect of the Decrease in the Interest Rate on the Market Price of Capital Goods • Third: The Ricardo Effect • Conclusion: The Emergence of a New, More Capital-Intensive Productive Structure • The Theoretical Solution to the "Paradox of Thrift" • The Case of an Economy in Regression • The Effects of Bank Credit Expansion Unbacked by an Increase in Saving: The Austrian Theory or Circulation Credit Theory of the Business Cycle • The Effects of Credit Expansion on the Productive Structure • The Market's Spontaneous Reaction to Credit Expansion • Banking, Fractional-Reserve Ratios and the Law of Large Numbers Chapter 6: Additional Considerations on the Theory of the Business Cycle • Why no Crisis Erupts when New Investment is Financed by Real Saving (And Not by Credit Expansion) • The Possibility of Postponing the Eruption of the Crisis: The Theoretical Explanation of the Process of Stagflation • Consumer Credit and the Theory of the Cycle • The Self-Destructive Nature of the Artificial Booms Caused by Credit Expansion: The Theory of "Forced Saving" • The Squandering of Capital, Idle Capacity and Malinvestment of Productive Resources  Credit Expansion as the Cause of Massive Unemployment • National Income Accounting is Inadequate to Reflect the Different Stages in the Business Cycle • Entrepreneurship and the Theory of the Cycle • The Policy of General-Price-Level Stabilization and its Destabilizing Effects on the Economy • How to Avoid Business Cycles: Prevention of and Recovery from the Economic Crisis • The Theory of the Cycle and Idle Resources: Their Role in the Initial Stages of the Boom • The Necessary Tightening of Credit in the Recession Stage: Criticism of the Theory of "Secondary Depression" • The "Manic-Depressive" Economy: The Dampening of the Entrepreneurial Spirit and Other Negative Effects Recurring Business Cycles Exert on the Market Economy • The Influence Exerted on the Stock Market by Economic Fluctuations  Effects the Business Cycle Exerts on the Banking Sector • Marx, Hayek and the View that Economic Crises are Intrinsic to Market Economies • Two Additional Considerations • Empirical Evidence for the Theory of the Cycle • Business Cycles Prior to the Industrial Revolution • Business Cycles From the Industrial Revolution Onward • The Roaring Twenties and the Great Depression of 1929 • The Economic Recessions of the Late 1970s and Early 1990s • Some Empirical Testing of the Austrian Theory of the Business Cycle • Conclusion Chapter 7: A Critique of Monetarist and Keynesian Theories • Introduction • A Critique of Monetarism • The Mythical Concept of Capital • Austrian Criticism of Clark and Knight • A Critique of the Mechanistic Monetarist Version of the Quantity Theory of Money • A Brief Note on the Theory of Rational Expectations • Criticism of Keynesian Economics • Say's Law of Markets • Keynes's Three Arguments On Credit Expansion • Keynesian Analysis as a Particular Theory • The So-Called Marginal Efficiency of Capital • Keynes's Criticism of Mises and Hayek • Criticism of the Keynesian Multiplier • Criticism of the "Accelerator" Principle • The Marxist Tradition and the Austrian Theory of Economic Cycles: The Neo-Ricardian Revolution and the Reswitching Controversy • Conclusion • Appendix on Life Insurance Companies and Other Non-Bank Financial Intermediaries  Life Insurance Companies as True Financial Intermediaries • Surrender Values and the Money Supply • The Corruption of Traditional Life-Insurance Principles • Other True Financial Intermediaries: Mutual Funds and Holding and Investment Companies • Specific Comments on Credit Insurance Chapter 8: Central and Free Banking Theory • A Critical Analysis of the Banking School • The Banking and Currency Views and the School of Salamanca • The Response of the English-Speaking World to these Ideas on Bank Money • The Controversy Between the Currency School and the Banking School • The Debate Between Defenders of the Central Bank and Advocates of Free Banking • Parnell's Pro-Free-Banking Argument and the Responses of McCulloch and Longfield • A False Start for the Controversy Between Central Banking and Free Banking • The Case for a Central Bank • The Position of the Currency-School Theorists who Defended a Free-Banking System • The "Theorem of the Impossibility of Socialism" and its Application to the Central Bank • The Theory of the Impossibility of Coordinating Society Based on Institutional Coercion or the Violation of Traditional Legal Principles • The Application of the Theorem of the Impossibility of Socialism to the Central Bank and the Fractional-Reserve Banking System • (a) A System Based on a Central Bank Which Controls and Oversees a Network of Private Banks that Operate with a Fractional Reserve • (b) A Banking System which Operates with a 100-Percent Reserve Ratio and is Controlled by a Central Bank • (c) A Fractional-Reserve Free-Banking System • Conclusion: The Failure of Banking Legislation • A Critical Look at the Modern Fractional-Reserve Free-Banking School • The Erroneous Basis of the Analysis: The Demand for Fiduciary Media, Regarded as an Exogenous Variable • The Possibility that a Fractional-Reserve Free-Banking System May Unilaterally Initiate Credit Expansion • The Theory of "Monetary Equilibrium" in Free Banking Rests on an Exclusively Macroeconomic Analysis • The Confusion Between the Concept of Saving and that of the Demand for Money • The Problem with Historical Illustrations of Free-Banking Systems • Ignorance of Legal Arguments • Conclusion: The False Debate between Supporters of Central Banking and Defenders of Fractional-Reserve Free Banking Chapter 9: A Proposal for Banking Reform: The Theory of a 100-Percent Reserve Requirement • A History of Modern Theories in Support of a 100-Percent Reserve Requirement • The Proposal of Ludwig von Mises • F.A. Hayek and the Proposal of a 100-Percent Reserve Requirement • Murray N. Rothbard and the Proposal of a Pure Gold Standard with a 100-Percent Reserve Requirement • Maurice Allais and the European Defense of a 100-Percent Reserve Requirement • The Old Chicago-School Tradition of Support for a 100-Percent Reserve Requirement • Our Proposal for Banking Reform • Total Freedom of Choice in Currency • A System of Complete Banking Freedom • The Obligation of All Agents in a Free-Banking System to Observe Traditional Legal Rules and Principles, Particularly a 100-Percent Reserve Requirement on Demand Deposits • What Would the Financial and Banking System of a Totally Free Society be Like?  An Analysis of the Advantages of the Proposed System • Replies to Possible Objections to our Proposal for Monetary Reform • An Economic Analysis of the Process of Reform and Transition toward the Proposed Monetary and Banking System • A Few Basic Strategic Principles • Stages in the Reform of the Financial and Banking System • The Importance of the Third and Subsequent Stages in the Reform: The Possibility They Offer of Paying Off the National Debt or Social Security Pension Liabilities • The Application of the Theory of Banking and Financial Reform to the European Monetary Union and the Building of the Financial Sector in Economies of the Former Eastern Bloc Conclusion: The Banking System of a Free Society  Bibliography  Index of Subjects  Index of Names

				The entire book, online, free from the Ludwig von Mises Institute

				http://mises.org/Books/desoto.pdf — 6 MB file will download [Thanks Mises Institute, a fine gift!]

				Articles in English & Spanish

				[I have found no way to provide links directly to these articles. Navigation of the site will discover them quickly and probably turn up some unexpected articles of interest not listed here. -Leif, July 1, 2009]

				http://www.jesushuertadesoto.com

				Ludwig Von Mises' Human Action as a Textbook of Economics

				The Theory of Dynamic Efficiency

				A Critical Note on Fractional-Reserve Free Banking

				Abstract. This paper presents an alternative, dynamic view of economic efficiency as a replacement for the static Paretian approach prevalent until now. The development of the Paretian perspective is traced, and a proposal is then made to reintroduce the dynamic aspect of efficiency, a dimension based on the creative, coordinating potential of entrepreneurship. In addition, the close relationship between ethics, personal morals, and the dynamic aspect of economic efficiency is studied, and the application of the new criterion of efficiency to various areas of economics is suggested.

				La Teoría de la Eficiencia Dinámica

				Resumen. En este trabajo se presenta un concepto alternativo de eficiencia económica de carácter dinámico y que pretende superar al concepto está- tico de origen paretiano hasta ahora dominante. Tras explicar el proceso de formación del concepto paretiano, se propone reintroducir la dimen- sión dinámica de la eficiencia basada en la capacidad creativa y coordi- nadora de la función empresarial. Se estudian, asimismo, las íntimas rela- ciones que existen entre la ética, la moral personal y la dimensión dinámica de la eficiencia económica, proponiendo la aplicación del nuevo criterio de eficiencia a distintos campos de la ciencia económica.

				The School of Salamanca, by Marjorie Grice-Hutchinson ••• (pdf) — 16th century Spanish theologian-economists whose ideas seemed precursors to those of the modern Austrian School.

				Brazil, India, China, Russia (BRIC)

				Michael Hudson, "Dismantling America's Financial-Military Empire", June 13, 2009

				This article is about some of the consequences of ignoring the work of Mises, Rothbard, Huerta de Soto, and other advocates of sound money and honest banking.

				http://www.michael-hudson.com/articles/globalism/090614De-DollarizationDismantlingEmpire.html

				"BRIC Countries Conclude Uneventful Summit", Michael Johnson, June 18, 2009

				http://seekingalpha.com/instablog/404911-michael-johnston/9071-bric-countries-conclude-uneventful-summit

				Events - recent history

				Mises Circle, Vancouver, September 13, 2008 — all day event: "Choice in Currency: A Path to Sound Money"

				Participants

				Leif Smith, Jim Bennett, Ricardo Valenzuela, Margaret Olsen

				Invited: Robert Himber, Brad Hughes, Jim Bennett

				.oOo.