Monetary policy (page 23)

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    No wonder you’re feeling the pinch: 2011 inflation of 8 percent for everyday purchases

    Given that the Federal Reserve is now the nation's largest creditor, through expansions of the money supply, one should hardly be surprised that prices are rising. Although the inflation tax has not reared its ugly head so much in the last couple of years, more reports are coming in that the devaluation of the currency has arrived. The American Institute for Economic Research (where I worked in 2009) has shown a particular interest in this development, and they're publishing a new measure, one which they call the Everyday Price Index. This only measures frequent purchases—once per month or more—which accounts for almost half of all spending but excludes big ticket items such as household appliances, automobiles, and houses. AIER has chosen these items because individuals have less ability to avoid or put them off. Additionally, one cannot plan well for them, and therefore price changes will have a greater impact on people's wallets. These particular price changes also explain, to a large degree, people's experiences and perceptions the best, since they are the prices they deal with most regularly. For this refined measure, AIER finds an inflation rate of 8 percent between 2010 and 2011—compared with 3.1 percent for the official, published rate (the Consumer Price Index). This finding caught the attention of media outlets across the country, including the Wall Street Journal. Here is their concise overview and analysis:
    Fergus Hodgson, March 16, 2012
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    CPAC v. Occupiers: My money’s on Keb and Co.

    National Review Online’s Morning Jolt reports on a possible showdown between CPACers and Occupiers this weekend: The language of the yahoos at Occupy D.C. sounds like an over-the-top parody, but this is apparently how they really think: On February 9th through February 11th, a who’s who of dastardly politicians…
    Becki Gray, February 8, 2012
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    Ferg’s take on Ron Paul: Interview on WGSO’s Ringside Politics

    With successful campaigns in the Iowa and New Hampshire presidential primaries—third and second, respectively—Ron Paul remains in the national spotlight. However, two broad misunderstandings are impeding his rise as the conservative front-runner and alternative to Mitt Romney: first, confusion about Paul's policy positions as a constitutional or paleoconservative; second, the dire state of the United States economy, which compels more aggressive action than the other candidates offer. Jeff Crouere (pictured), a radio host I admire with WGSO in Louisiana, had me on to address these concerns and respond to questions from callers. Click below to listen (24 minutes, mp3), and I encourage people to check out his show, weekdays at 7 to 11am CST. [audio:]
    Fergus Hodgson, January 18, 2012
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    A century of failure: for the Federal Reserve apologists

    Since the role of the Federal Reserve and its impact on the economy is becoming an issue in the GOP campaign, I encourage people to take in this lecture by George Selgin. He is a sharp, dispassionate economist, and he gives a tight overview of its record (40 minutes).
    Fergus Hodgson, January 14, 2012