I have read almost none of von Mises directly, yet there is no single economist that has captured my thinking more than he has. I believe this is so because Austrian economics fits very naturally into my views of how man interacts with man. Nothing captures this better than the idea of Human Action. Humans act. These two words capture so much wisdom in so many ways...I could write many pages about this, perhaps another time.
Mises discusses the idea of Free Banking in Human Action, chapter 17, section 12. I can say this is the first section of any of his work that I have read directly. Make of that what you will.
My intention is to write a series of articles on subjects and themes from this section, in four main groupings:
1) Competitive, Free-Market Banking - Mises holds that competitive free banking (no government intervention or support) is the only way to regulate banking. He allows for the possibility of artificial credit expansion, and is quite certain that the market will quickly force a correction whenever this practice is implemented by one or more banks.
2) Being "Fooled" Into Taking and Holding Dubious Banknotes - Mises describes the reasons he does not believe this will be of concern.
3) Credit Expansion / Real Bills - Mises describes the inflationary nature of Bills of Exchange
4) Gresham's Law - Mises rightly describes Gresham's Law, with good money driving out bad if all money trades freely.
Mises covers much ground in one small section. I will attempt to capture the key points and properly expand on these.
No comments:
Post a Comment