Monetary Liberty is NOW!

The Real Immigration Issue

Being a first generation American I have an appreciation for the immigration issue and it's complexities. Although at the end of the day I feel that many of problems in immigration isn't immigration but the struggle over remaining resource in a economy that is getting weaker and weaker everyday from a growing government. So in a debate at RonPaulForums.com about immigration I had this to say:

Correlation is not causation, there are two main problems economically with
the current state of immigration.

1) The Welfare State - due to having a welfare state
citizens and non-citizens are becoming more and more a drain on taxpaying
citizens and non-citizens... you have to dismantle the welfare system. The
solution to this issue is a supply response, not a demand response. As long as
there is a supply of government services, there will be a demand for it whether
it's domestic or foreign. We must dismantle the supply of government services
which taxpayers must pay for. Volunteered from private sources are encouraged
and a not a drain on those who choose not to volunteer their limited resources.
Also as far as immigration goes, these types of programs attract probably the
wrong people. If you have no welfare system there is no incentive for anyone to
immigrate unless it's to be productive and to have the opportunity to be
productive.

2) Growing Public Sector, Shrinking Private Sector - Due
to unions and a growing state the amount of public sector jobs have increased
which have very rigid wages, they don't go down, and they always go up. This
growing sector has consumed the amount of private sector jobs who have more
elastic wages that can adjust to changes in the supply of labor and demand for
the goods produced. Shrink the public sector, the private sector will grow
enough and be vibrant enough to handle immigration. With the growth in labor
there is a growth in demand for goods to offset it in a healthy free market
economy.

In countries where open borders have had problematic effects have had large
governments and small private sectors. Prosperous countries like Switzerland
have multiple languages spoken. As far as assimilation, culture is constantly
changing on a daily basis, so to argue that there is some constant standard of
values, traditions that hasn't changed in perception or execution is an
idealistic delusion. The beauty of humanity is how it's culture changes one
generation to the next.

None of us talk with a 1920's accent or vocabulary or wear 60's attire
(without a sense of novelty). The world is constantly changing faster and
faster, you either diversify your outlook, knowledge and skills to adapt or get
lost in the changes. It's in this diversity of culture, ideas, and values where
innovation is conjured.

Why Money Doesn't Matter

Why Money Doesn't Matter

by Alex Merced

If you spend enough time reading and listening to the media at Mises.org put out by the Mises Institute it becomes quite apparent that the supply of money doesn't change anything fundamentally in the economy. The market always adjust prices in the economy to the supply and demand of goods, so money being a good like anything else will adjust it's prices when the supply of it changes but nothing has fundamentally changed. The way we subjectively value all our goods and services haven't changed, all that has changed is how we value it relative to the changing money supply.

Although prices don't change immediately with any change in supply in demand, a period of price discovery must occur. During this period through trial and error of human action people will overvalue and undervalue goods and services in the search for the “market price” of money and the goods and services relative to it. When this market price is found the overall subjective value of things will not have fundamentally changed, although this allows an opportunity for arbitrage. Arbitrage is the act of taking advantage of over or under evaluations in market prices. Those who best take advantage of this are those who get the new supply of money first or understand this process, cause they have the best knowledge of the undervaluation currently in the economy before prices adjust. This arbitrage of those in the know is the effect that economist feel can benefit or hinder the economy, and they advocate a ever changing money supply to keep this state of arbitrage constant to never let the true “market price” of money and goods be found.

How would prices eventually adjust?

If the money supply increases: If the money supply (inflation) then initially all goods and services are undervalued relative to money, so then a consumption binge occurs which pushes prices up to the market price. Some people may still advocate this course of action cause it'll devalue one money versus another money increasing the purchasing power of the second money to buy goods denominated in the first money, which is temporarily the case during the adjustment. Another consideration though for those using the second money is that while the purchasing power for consumers has increased so has the purchasing power of producers in that money which means that domestic goods in that currency will be cheaper to produce offsetting the increase in the value of the currency overtime. To truly have a sustainable increase in transactions between currencies one must have a true competitive advantage in the goods and services they offer.

If the money supply decreases: If the money supply decreases (deflation) then initially all goods and services are overvalued relative to money, so then some people will prefer to sell assets to take advantage of the overvaluation which will push prices down to the market price. Once again is argued to have a negative consequence between different currencies cause as the first currency increases in value other currencies will depreciate relatively. Only looking at consumer purchasing power it seems that it'd be expensive for foreign consumers to buy domestic goods, although we often forget the purchasing power of domestic produces increases which will lower the price of their goods offsetting the increase in value. So after the adjustment once again a country with a true competitive adjustment will always succeed.

If the money supply is constant: If the money supply is constant then there is no adjustment, instead things are always priced relatively to supply and demand versus a known money supply. If prices want to go higher then the money supply can handle, then prices of the supply chain will be pushed down to operate in the current supply of money, always relative to the changing subjective values of people.