Northern Trust Gives the Austrian School a Big Thumbs-Up
All We Are Sayin' Is Give Free Markets a Chance [pdf]
Given the economic and financial market "challenges" of the past year, some pundits and politicians are concluding that these challenges are the result of the failure of free markets. I would respond that we cannot determine whether free markets have failed unless we have had free markets. I do not think we have.
[…]
There is at least one group of economists that realizes the economic mischief caused by central banks — economists who belong to the Austrian school. (For information about Austrian economics, click on this link to the Ludwig von Mises Institute, http://mises.org/ or this link to Leithner and Company, a private investment firm located not in Austria, but in Australia, http://www.leithner.com.au/. I am not endorsing the political views or the investment advice of either of these entities, but I am endorsing their approach to economic analysis.)
– Paul L. Kasriel, Director of Economic Research, Northern Trust Global Economic Research
Comments (13)
eric lansing
Caroline Baum frequently cites him in her Bloomberg articles.
Published: July 18, 2008 12:09 PM
Jake
Wow!!! This is fantastic news.
A BIG pat on the back to everyone at the LVMI for all their hard work spreading the message of Freedom and Austrian Economics.
Congratulations!!!
Published: July 18, 2008 12:10 PM
fundamentalist
That's great! I have noticed from watching hours of CNBC that the finance guys get it. Years of experience has taught many of them the truths of Austrian econ even though they may not know what Austrian econ is. The big fights tend to happen between the mainstream economists and the financial guys, or between the finance guys who really get it and the ones who cling to their "random walk" or popular Keynesian dogma.
Maybe we should think about losing the term "free market" for a while, though. It seems to me that when people here "free market vs the government" they see the government on the side of the people and the free market on the side of big business. And they tend to see the free market as one institution (big business) against another.
Maybe we should frame the arguement instead in terms of the people vs the government. So we might say "let the people decide instead of the government." After all, a free market is nothing but the egalitarian process of the people voting with their dollars on how the economy should proceed as opposed to bitter bureaucrats dictating how we should choose.
Published: July 18, 2008 12:55 PM
chas
Great news. This is a major endorsement from such a highly respected economist.
Published: July 18, 2008 1:36 PM
chas
Great news. This is a major endorsement from such a highly respected economist.
Published: July 18, 2008 1:37 PM
chas
Great news. This is a major endorsement from such a highly respected economist.
Published: July 18, 2008 1:37 PM
chas
Out-of-this-world news, for Kasriel is such a bright and respected economist (it takes more than an average IQ to understand ABCT, something you couldn't expect from any Keynesian disciple).
Published: July 18, 2008 1:48 PM
chas
Out-of-this-world news, for Kasriel is such a bright and respected economist (it takes more than an average IQ to understand ABCT, something you couldn't expect from any Keynesian disciple).
Published: July 18, 2008 1:49 PM
Erik
fundamentalist,
Great points. I think you're onto a winning strategy here. I'll be using it in my future discussions with my uneducated Keynesian friends!
BTW, the CNBC analysts have been turned onto the Austrian ideas because it makes them gobs of cash!
Published: July 18, 2008 3:27 PM
William H. Stoddard
The trouble with "let the people decide" as a motto is that nearly everyone in an American audience will hear that and think of voting, whether in elections to public office or on initiatives and referenda. "The people" is thought of in collectivist terms, as a single entity that makes a single choice—necessarily through some sort of vote-counting procedure. And since democratic majorities are just as capable as political elites of endorsing foolish or malevolent economic policies, this doesn't do much good. I recommend finding a different slogan.
Published: July 19, 2008 7:23 PM
William H. Stoddard
The trouble with "let the people decide" as a motto is that nearly everyone in an American audience will hear that and think of voting, whether in elections to public office or on initiatives and referenda. "The people" is thought of in collectivist terms, as a single entity that makes a single choice—necessarily through some sort of vote-counting procedure. And since democratic majorities are just as capable as political elites of endorsing foolish or malevolent economic policies, this doesn't do much good. I recommend finding a different slogan.
Published: July 19, 2008 7:25 PM
liberty student
We need to stop avoiding words because the statists change the definitions or through mass brainwashing, create negative connotations where none should exist.
There are times for tactical retreat, but no one wins a battle running backwards.
Free markets are key to Austrianism. Don't dilute the message, become more effective preaching it.
Published: July 19, 2008 10:14 PM
Chris
Kasriel also analysed the bust of the early 2000s in explicitly Austrian terms. See http://wps.prenhall.com/wps/media/objects/84/86643/ie/ie14_02.html and particularly http://www.ntrs.com/library/econ_research/weekly/us/010330.html.
Cheers, Chris
Published: July 21, 2008 7:17 PM