Authored by George Ford Smith via Mises Institute,
Though Herbert Hoover was a pioneer among presidents in getting the government to "do something" about a depression, he was no maverick. He had the support of distinguished court economists who promoted the idea that stable prices were the key to lasting prosperity.
Common sense tells us that if we walk into a store and find prices consistently lower than they had been, we are better off, other things equal, because our money buys more. As Rothbard wrote, "Increased productivity tends to lower prices (and costs) and thereby distribute the fruits of free enterprise to all the public, raising the standard of living of all consumers. Forcible propping up of the price level prevents this spread of higher living standards."
While the concept "stable price level" may not sound menacing, the mechanism for achieving it was. The theory's proponents, which included such economics luminaries as Irving Fisher and John Maynard Keynes, weren't too concerned with price stability when prices tended to rise during a boom, especially if prices were rising on the stock market where they were heavily invested. The price stability priests were mostly concerned with falling prices during a bust, and for that they relied on government's creature, the central bank. Falling prices, in fact, were regarded as the cause of depressions. Using enlightened "monetary policy," central banks needed to keep prices from falling to keep economies from collapsing.
Yale and Harvard Go Boom and BustYale professor Irving Fisher helped popularize the view that the "new era" economy of the 1920s would last indefinitely. With the exception of stocks and real estate, prices were fairly level, and since the mainstream definition of inflation was and still is "a general and progressive increase in prices," the 1920s were and still are said to be a period of inconsequential inflation. Rothbard tells us that,
Fisher was particularly critical of the minority of skeptical economists who warned of over-expansion in the stock and real estate markets due to cheap money, and even after the stock market crash, Fisher continued to insist that prosperity, particularly in the stock market, was just around the corner.
Beginning in 1923, Fisher wrote a syndicated column, carried by leading newspapers, in which he discussed relevant economic issues of the day. Fisher's column was Yale's answer to the Harvard Economic Service. A 1986 paper issued by the National Bureau of Economic Research (NBER) says that,
Fisher's predictions in the period before and after the crash, were no closer to the mark than those of his Harvard brethren.
"In two months I expect to see the stock market much higher than today," Fisher said on October 15, 1929. Economist Hernán Cortés Douglas tells us that,
Days after the crash [on October 29], the Harvard Economic [Service] informed its subscribers: "A severe depression such as 1920-21 is outside the range of probability. We are not facing a protracted liquidation."
After repeated forecasts of optimism, the Harvard Economic Service folded in 1932. Fisher's professional reputation gradually collapsed. Fisher's son estimates his father lost $10 million during the Depression (roughly $241 million in 2026 dollars). Yale had to buy Fisher's house and rent it back to him to keep him from being evicted. When he died in 1947 he left an estate so small it wasn't taxed.
Interestingly, the authors of the NBER paper applied "modern statistical techniques" to analyze the data Fisher and the Harvard service used in their forecasts. The result: "The statistical findings mirror the verbal pronouncements' systematic over-prediction of economic activity." In other words, both Fisher and Harvard were sound methodologically; it was just unfortunate that reality led them astray.
(NBER, it should be mentioned, runs a dating service - it dates when recessions begin and end. For example, its Business Cycle Dating Committee announced in December, 2008 that the US economy was in a severe recession that began a year earlier, in December, 2007. In September, 2010 they announced that the recession had ended 15 months earlier, in June, 2009. As top-tier economic scientists they avoid rushing to conclusions, so we can be sure of their results. Given that the last one has officially ended, there will be no continuity between it and the one to follow.)
Keynes was no less a forecasting bungler. An avid speculator, he saw nothing but good times ahead during the 1920s boom:
He met the Swiss banker, Felix Somary and was begging Somary to give him some great stock picks. When Somary said he couldn't recommend any stocks right now because he was expecting a crash, Keynes responded infamously, "We will not see another crash in our lifetimes." (Somary once said, correctly: "the state alone is responsible for inflation: inflation without government . . . is impossible.")
Keynes lost a fortune but went bargain-hunting in the early 1930s, putting aside his loathing of the barbarous relic and buying up gold stocks and managing money for insurance companies. He recovered handsomely until he was wiped out again when an incipient recovery collapsed in 1937. When he died of a heart attack in April, 1946 he had once more accumulated an impressive fortune.
Austrians Explain the Crisis - and the CureLudwig von Mises and F. A. Hayek were among the few economists to identify the economy of the 1920s as a credit bubble. Their crystal ball was the economic theory they had developed, known today as the Austrian Theory of the Trade Cycle. It says bank credit expansion based on money created out of nothing generates booms that eventually go bust.
Activities that were profitable when money was made cheap are revealed as unsustainable when low-interest loans are no longer available. Economist Roger Garrison explains:
Mises showed that an artificially low rate of interest, maintained by credit expansion, misallocates capital, making the production process too time-consuming in relation to the temporal pattern of consumer demand. As time eventually reveals the discrepancy, markets for both capital goods and consumer goods react to undo the misallocation.
The market reaction is the bust phase of the business cycle, as producers attempt to bring production in alignment with actual consumer demands. Hans Sennholz has written,
Economic booms and busts occur in every case of fiat expansion, whether the expansion is one percent or hundredths of a percent. The magnitude of expansion. . .merely determines the severity of the maladjustment and the necessary readjustment.
Even if most prices should decline while monetary authorities expand credit at a modest rate, the injection of fiat funds falsifies interest rates and thereby causes erroneous investment decisions.
"Credit expansion" is another name for a policy of inflation. Inflation creates "the illusion of profit," as Mises noted in Socialism; inflation "discourages saving, and thereby prevents the formation of fresh capital." It is this "rottenness" - inflation - that must be extirpated along with all the bad bets, but - since Fisher and Keynes - it is considered the cure.
For further discussion see The Jolly Roger Dollar.
Tyler Durden Mon, 08/31/2026 - 17:00New York Governor Kathy Hochul, a self described feminist and "social justice Catholic", has raised eyebrows this week after appearing in a hijab at an Islamic Cultural School in the Bronx to make statements against "Islamophobia". The visit is part of a greater Democrat Party effort to strengthen political alliances with world immigrants and Islamic immigrants in particular.
NY Governor Kathy Hochul is now wearing a hijab. pic.twitter.com/tzd7VIRxoS
— Breaking911 (@Breaking911) August 30, 2026Hochul received immediate backlash and criticism from conservatives, pointing out the hypocrisy of a feminist pandering to migrants who, under Sharia Law, view women as property. Rep. Brandon Gill (R-TX) mocked Hochul, saying liberals like her complain President Donald Trump is “turning America into the Handmaid’s Tale” - only to then cover their heads with a symbol of submission to Muslim "patriarchy."
Democrats: "Sexist Republicans are turning America into the Handmaid's Tale!"
Also Democrats: pic.twitter.com/7lWhOtvXFN
Hochul's virtue signal is not exactly a new thing among Democrat women, however. Hochul has worn the hijab in the past. Female politicians breaking out the hijab to rub elbows with Muslim advocacy groups are common these days.
Last year Peggy Flanagan (Minnesota Lt. Governor, Catholic), then a U.S. Senate candidate, wore a hijab while visiting the Karmel Somali Market in Minneapolis and speaking on Somali-language television. She used the greeting “As-salamu alaykum” and said the Somali community is “part of the fabric of the state of Minnesota.” Critics called it pandering amid the now infamous Somali-linked welfare fraud investigation.
Mikie Sherrill (New Jersey Governor) posted photos in March of herself wearing a hijab at the Islamic Center of Passaic County in Paterson during a Ramadan event. She took selfies with attendees and the mosque’s imam. The visit drew scrutiny because of the imam’s past deportation case involving alleged Hamas ties.
And of course, Alexandria Ocasio-Cortez (NY Congresswoman, Catholic) wore a hijab at an Eid al-Adha event in the Bronx alongside Mayor Zohran Mamdani. She spoke onstage and later said head coverings were “the respectful move” at a mosque.
The act of wearing the clothing is not in itself the issue. The issue is the incessant cries about "women's oppression" from feminists when it comes to western culture, all while bowing at the feet of a foreign ideology that actually, factually, treats women as second class citizens.
This is yet more proof that the political left is obsessed with securing a multicultural "Utopia" in the US. So much so that they are willing to look the other way when it comes to their most "sacred" principles and ideals if it means maintaining alliances with third worlders.
Tyler Durden Mon, 08/31/2026 - 16:40Authored by James Howard Kunstler via Clusterfuck Nation,
"Carney increasingly reminds me of Fauci. He has that exact same air of technocratic infallibility. . . ."
- Hans Mahncke on X
You go for decades without even thinking of the place. The Great White North. Very polite people, somewhat Scottish, seems like. There's poutine! Une invention Québécoise - an indigestible mélange of French fries, gravy, and cheese curds, like something you'd cook up at 4am after a toga party in a frat house. Ice hockey (of course, but was it necessary?) Polar bears. Puffins on the Labrador cliffs. Tar Sands. Plaid upholstery...
Years ago, we used to go up there from college in the farthest reaches of upstate western New York just to get a half-fake buzz of being in "a foreign country." Niagara Falls was like Times Square without the charm. Bunch of squalid wax museums and ashtray shoppes. Toronto was Rochester on steroids, beyond forgettable.
I once took a choo-choo train from Seattle to Vancouver just to take in the scenery along the Pacific Coast. Bald eagles galore all the way up feeding on stuff out in the Pacific tidal mud-flats. Got to Vancouver. They yanked me out of the customs line and stuffed me in a back office. A female immigration officer swaggered in, said they found a nine-year-old DUI conviction for me on some computer (well. . .. okay. . . a night of fishing with rum). Said she could keep me out of the country if she was in a bad mood. I couldn't help wising off: "Nice to know Canadian immigration policy depends on your mood." Whoops. They detained me for an extra two hours just to make me feel the pain. But I was eventually released into that boring city. Thank God for the Chinese restaurants.
And now. . . Mark Carney! He's a beauty. A refined ectoplasmic manifestation of all the Globalist huggermugger working tirelessly to upend Western Civ. He has a weird glow of semi-transparency - not in the sense of revealing any truths, but more like you can partly see through him . . . he's only half there . . . a ghost in the geopolitical machine.
More to the point, Mark Carney has made himself a pain-in-the-ass for President Donald Trump.
On the surface, this US / Canada rift appears to be all about trade relations.
Naw. It's about Mark Carney being a tool for merry old England attempting to capture the resource base of northern North America to collateralize what little remains of the UK's once-sprawling, now sinking, empire. England is not so merry these days. It has somehow managed to issue a fatwa on itself and entered a gruesome process of assisted economic and cultural suicide. You can't even raise a British flag there anymore without risking weeks in the slammer. The home folks get stabbed and beheaded. It's all blight, rape, kebabs, and hijabs over there. Not a good look if you still want to be that country you dimly remember.
Plus, they want to kick off a big war with Russia. Bwa-ha-ha-ha-ha-ha! Really? Lacking much of a military, Ukraine was Britain's tool for that. Trouble was the huge expense of that project. Thought they could work-around it by turning Ukraine into a money-laundry, washing, rinsing, and disbursing US-sourced funds to Mr. Zelenskyy, with giant kickbacks to the Democratic Party's money apparatus. Worked nicely when the phantom "Joe Biden" haunted the White House. He and his sicko son, Hunter, were already in so deep in Ukraine since JB's felonious veepdom that Mark Carney - then chief of the Bank of England - could hang the Bidens out to dry anytime, if required.
Lo, these many years, then, Britain and NATO have sponsored all that drone-making and missile-launching action from Ukraine deep into Russia - in case you wonder how Zelenskyy carries on this stupid war, considering there are no young men left in Ukraine eligible to reinforce the battle lines in Donbas. Britain and NATO probably also furnish the satellite targeting of Russian assets. You must doubt that the USA is involved in that anymore. Luckily, Mr. Putin has the Christian patience of a true saint.
Our president is sick of Ukraine and the festering geopolitical disease it has been infected with by our increasingly-former allies in Europe. NATO's aim with Russia is exactly the same as Britain's push in Canada - a resource grab for the failing nations of Europe, who are getting choked to death by Ursula von der Leyen and her EU flying monkeys. Germany, France, the Netherlands, Italy, Spain. . . all whirling around the drain. Our president sees all that. (You don't need magic glasses.)
Maybe it's time to just send the 82nd Airborne into Ottawa. Flight time: under two hours from Fort Bragg, NC. Drop them on Parliament Hill. Let them hang around a few hours. Then, declare the whole thing a gag and fly them home. It'd be worth it. Or maybe go in and snatch Mark Carney like we did Maduro. Stuff Carney in an adjoining cell at the MDC in Brooklyn. I'm sure the two could amuse each other, swap satisfying gripes and sob stories.
Really, why stop at just re-naming Lake Ontario. Take the whole darn thing like a pie that has been left on the windowsill too long. The Canadian people would get over it in five minutes. Everything is easier in the USA. Running a company, especially. They could keep their poutine and their hockey, learn to have a little fun once in a while. Quebec could become a theme park (what else have they got going there?). No more tariffs to get hung about. Honk if you like the idea.
We publish a variety of perspectives. Nothing written here is to be construed as representing the views of ZeroHedge.
Tyler Durden Mon, 08/31/2026 - 16:20