Author Archives: admin
Humor — Hitler finds out that Scott Walker won the Wisconsin recall election
The Tax Man wants your travel plans — US & Argentina
Imagine a day when you plan a trip abroad… and you exchange some dollars for the currency of your destination country before you depart.
At the airport, uniformed agents ask whether you have any foreign currency. You are then asked to prove you obtained the currency legally… and inform the IRS about where you’re going, how long you’ll be away and the reason for your trip.
As of seven days ago, this is the new reality in Argentina. And as of 11 days ago, an event in Washington should give pause to anyone who says, “it can’t happen here.”
The new rules in Argentina came into effect a week ago today. They are aimed squarely at holders of U.S. dollars.
The government wants to keep those dollars within the country, the better to shore up the central bank’s reserves and pay down its debts.
“Many Argentines,” reports The Associated Press, “only declare part of their wealth and income to evade taxes, and use black-market currency exchanges to convert their inflationary pesos into dollars. Travel agencies are the latest target since they manage multiple currencies and offer customers black-market rates for their money.”
A curious letter addressed to Treasury Secretary Timothy Geithner raises the specter of similar rules coming down the pike in this country.
Dated May 24, it comes from Rep. Barney Frank, the top Democrat on the House Financial Services Committee… and Rep. Sander Levin, the top Democrat on the Ways and Means Committee.
“Frank and Levin,” says a joint press release, “have long been concerned that the language in U.S. trade and investment treaties was too restrictive and did not leave adequate flexibility for governments to use controls to stem the massive flows of speculative capital that can exacerbate economic crises.”
So they’re asking Geithner to make it clear, in writing, that the United States retains “the ability to deploy capital controls on the inflow or outflow of capital without being challenged by private investors.”
“You no longer have to read between the lines when it comes to currency and capital controls,” says an email from Addison this morning. Indeed, you can just read the lines directly.
Once Geithner obliges the Congress members with a written statement — do you really expect him to do otherwise? — a new brick will be erected in the “virtual Berlin Wall” that Addison has described to readers of Apogee Advisory for nearly a year now.
“Even if you’re a person of modest means,” he wrote last July, “and you merely want to ‘spread the risk around’ by putting a portion of your wealth outside U.S. banks and the U.S. dollar… it’s becoming harder and harder to do so.”
(Read more)
letter to National Review Magazine re: The Real Cause of the Euro Debt Crisis
From Patrick Barron: Dear Sirs:
In his essay “Four Kinds of Dreadful”, John O’Sullivan discusses the possible outcomes of the Greek debt crisis (which really is a euro debt crisis). It is important that readers understand the cause of the crisis. Mr. O’Sullivan repeats some common misconceptions about that cause when he states that:
“Its original design was flawed because it sought to include too many countries with too-diverse economic characters and histories, too-different levels of unemployment, and so on.” He later states that “Above all, the euro zone did not include…transnational labor mobility; and transnational monetary transfers.” And finally, that “a single currency required a single budget, a single treasury, and a single fiscal policy.”
None of these reasons is the cause of the crisis. First of all, there is nothing to prevent people with different characters, etc. from adopting a common currency. Here in the US we have many people with different characters, different levels of productivity, etc. all using the dollar. There may indeed be cultural barriers to labor mobility, but several nations with different cultures have adopted the dollar as their national currency. Finally, all fifty states of the union use the dollar, without requiring that they meld their budgets, treasuries, and fiscal policies.
The real cause of the euro debt crisis has been explained by Dr. Philipp Bagus of King Juan Carlos University in his book, The Tragedy of the Euro. Dr. Bagus explains that the European System of Central Banks did not eliminate national central banks. These national central banks buy their respective country’s sovereign debt and use that debt as collateral for euro loans at the European Central bank. The result is predictable. All seventeen members of the European Monetary Union have the ability to monetize their government’s sovereign debt and force monetary inflation on the rest of the members. It is similar to having seventeen counterfeiters trying to outdo one another. First debt soared, and now inflation is being felt even in the more responsible nations such as Germany, because all use the euro.
There is no solution to this problem, as the euro is currently constructed. Fiscal treaties to prevent the inevitable money printing will be ignored, since there is no enforcement mechanism. Furthermore, there never will be an enforcement mechanism, because the seventeen members are sovereign nations with electorates that must be mollified. The euro was doomed from the day it was born.
Shanghai Composite Index Reflects Tienanmen Square massacre – Censored by China
The Shanghai Composite Index was down 64.89 on the anniversary of the massacre, which occurred on June 4, 1989.
Written in the American style, the date of Tiananmen Square was 6/4/89.
The WSJ also notes that the days opening was 2,346.98, which seems to refer to 23, and the date reversed.
Predictably, of course, searches for Shanghai Composite Index were banned on Weibo within hours. (Read more)
China Forbids International Tourism to Tibet Indefinitely
In a matter of days, the number of expected foreign visitors to Tibet has gone from millions to zero.
Chinese authorities alerted foreign travel agencies Tuesday that they would no longer be issuing entry permits to Tibet, the latest in a series of regulations being put on travelers to Tibet. The announcement follows the self-immolation of two Tibetans last week.
Tibet is no stranger to Chinese interference in its tourism industry. Tibet’s failed rebellion in March 1959 and the event’s annual memorial on National Uprising Day has chronically put the region at odds with the People’s Republic of China. In 2008, protests after National Uprising Day turned into riots that were met with violence by PRC forces. The Chinese government temporarily closed Tibet to foreign visitors. That is a now-annual practice in March, and during other national events significant to the Chinese government. (Read more)
Why Rand Was Right to Endorse Romney
Not sure I completely agree with the endorsement of a war-mongering, wealth redistributing, neo-con. But for those committed to working within the system (as opposed to turning your back on it and “going Galt”) this makes sense:
Here Come QE3…
Disappointing U.S. economic data, new strains in financial markets and deepening worries about Europe’s fiscal crisis have prompted a shift at the Federal Reserve, putting back on the table the possibility of action to spur the recovery.
Such action seemed highly unlikely at the central bank’s April meeting, when forecasts for growth and employment were brightening. At their policy meeting this month, Fed officials will weigh whether the U.S. economic outlook is deteriorating enough to justify new measures to boost growth, according to interviews and Fed speeches. (Read more)
Obesity in America: To Win, We Have to Lose Government
Walter Block — Jews for Ron Paul
Peter Schiff: Reality Bites – A Look Behind the Dismal Economic Data
maximum-wage law was enacted by Massachusetts as early as 1630
he first maximum-wage law was enacted by Massachusetts as early as 1630. Due to the high wages commanded by the scarcity of construction craftsmen, the law concentrated on maximum-wage rates in the building trades. Carpenters, bricklayers, etc., were limited to two shillings a day and any payment above this rate would subject both the employer and the worker to punishment (for instance, a buying-cartel of employers established by the law punished the recalcitrant employer who decided to break ranks). Almost immediately, the magistrates decided to imbibe more of the magic medicine, and legal wage rates were pushed down to 16 pence a day for master carpenters and bricklayers, and correspondingly lower for other laborers.
But the economic laws of the market made enforcement hopeless, and after only six months, the General Court repealed the laws, and ordered all wages to be “left free and at liberty as men shall reasonably agree.” But Massachusetts Bay was not to remain wise for long. By 1633 the General Court became horrified again at higher wage rates in construction and other trades and at the propensity of the working classes to rise above their supposedly appointed station in life by relaxing more and by spending their wages on luxuries. Denouncing “the great extortion … by divers persons of little conscience” and the “vain and idle waste of precious time,” the court enacted a comprehensive and detailed wage-control program.
The law of 1633 decreed a maximum of two shillings a day without board and 14 pence with board, for the wages of sawyers, carpenters, masons, bricklayers, etc. Top-rate laborers were limited to 18 pence without. These rates were approximately double those of England for skilled craftsmen and treble for unskilled laborers. Constables were to set the wages of lesser laborers. Penalties were levied on the employers and the wage earners who violated the law. Sensing that maximum controls below the market wage led to a shortage of labor, the General Court decreed that no idleness was to be permitted. In effect, minimum hours were decreed in order to bolster the maximum-wage law — another form of compulsory labor. Workmen were ordered to work “the whole day, allowing convenient time for food and rest.”
Interestingly, the General Court soon decided to make an exception for the government itself, which was naturally having difficulty finding men willing to work on its public-works projects. A combination of the carrot and the stick was used: government officials were allowed to award “such extraordinary wages as they shall judge the work to deserve.” On the other hand, they were empowered to send town constables to conscript laborers as the need arose.
Although merchants were happy to join the landed oligarchy and the Puritan zealots in forcing down the wage rates of laborers, they were scarcely as happy about maximum controls on selling prices. The gentry were eager, however, to force downward the prices of products they needed to buy. A blend of mercantilist fallacies and Puritan suspicion of commerce, the result was persistent attempts to force commodities below their market prices. Having little conception of the function of the price system on the free market, the Massachusetts authorities also felt that maximum-price control would bolster the maximum-wage-rate program. There was no understanding that general movements in prices and wages are governed by the supply of and demand for money, and that this too can best work itself out on the free market.
Corn was the major monetary medium of the North, and in 1630 Massachusetts set the sterling price of corn at six shillings per bushel. Failing to work, this control was repealed along with the wage laws of 1631, and corn was “left at liberty to be sold as men can agree.” In 1633, however, maximum-price controls were reimposed as an auxiliary to the wage controls.
The massive wage laws of 1633 were quickly discovered to be a failure; once again the quiet but powerful economic laws of the market had triumphed over the dramatic decrees of the coercive state. After one year the actual wage rates were 50 percent higher than the statutory levels. At that point, the General Court repealed the penalties against paying, but retained those against receiving, wages above the fixed legal rate. While, in fact, no employer had ever been tried or penalized under the old act, the wage law was now an open and flagrant piece of class legislation. This was nothing new, however, as there were ample precedents in English maximum-wage laws since the early 15th century.
Another change made in 1634 allowed a little flexibility in decreed prices and wages by permitting each town to alter the legal rate in case of disputes. Only a year later the General Court, despairing of the continued failure of the law to take hold, repealed the comprehensive wage controls and the auxiliary price controls. Just before this comprehensive repeal, the courts had apparently been driven by the failure to inflict ever harsher penalties; fines had been so heavy that two workers were imprisoned for failure to pay. The authorities were at the crossroads: should they begin to impose on workers violating clearly unworkable economic decrees the sort of punishment meted out to heretics or to critics of the government? Happily, common sense, in this case, finally prevailed. (Read more)
Public Swearing In Middleborough, Mass. Now Subject To Fine
Residents in Middleborough voted Monday night to make the foul-mouthed pay fines for swearing in public.
At a town meeting, residents voted 183-50 to approve a proposal from the police chief to impose a $20 fine on public profanity.
Officials insist the proposal was not intended to censor casual or private conversations, but instead to crack down on loud, profanity-laden language used by teens and other young people in the downtown area and public parks. (Read more)
David Henderson – Does Government Make You Safer?
Pirate Bay Ready For Perpetual IP-Address Whac-A-Mole
Last week The Pirate Bay added a new IP-address which allows users to circumvent the many court-ordered blockades against the site. While this proved to be quite effective, the Hollywood backed anti-piracy group BREIN has already been to court to demand a block against this new address. But that won’t deter The Pirate Bay, who say they are fully prepared for an extended game of whac-a-mole using the hundreds of IP addresses they have available.
The Pirate Bay is arguably the most censored website on the Internet.
Courts all around the world have ordered Internet providers to block subscriber access to the torrent site, and the end is still not in sight.
Within a few days, a new deadline for five UK and five Dutch Internet providers passes. This means that millions more will be unable to access The Pirate Bay, at least, that is the plan.
Last week The Pirate Bay team responded to the blockades by adding a new IP-address. The new location was setup to make it easier for people to start their own dedicated proxy sites, but it also allows blocked Pirate Bay visitors to gain access to the site.
Instead of the normal address they simply go to 194.71.107.80, bypassing the court order – for the time being at least. (Read more)