[jmherbener]

Kantians make two distinctions concerning propositions. They are either analytic or synthetic and they are either apriori or aposteriori. The truth of analytic propositions can be established by formal logic alone. Establishing the truth of synthetic propositions requires more than formal logic alone. Observations are necessary to establish the truth of aposteriori propositions and they are not necessary to establish the truth of apriori propositions.

Synthetic apriori propositions, then, refer to propositions whose truth can be established but formal logic is insufficient to do so and observations are unnecessary. What must be added to formal logic is knowledge gained, not by observation, but by reflection.

Take a look at the piece by Hans Hoppe:

https://mises.org/sites/default/files/Economic%20Science%20and%20the%20Austrian%20Method_3.pdf

[jmherbener]

The top 5 percent of Americans earned 22.1 percent of total income in 2013 according to the census bureau:

http://www.census.gov/content/dam/Census/library/publications/2014/demo/p60-249.pdf

The federal government taxes were $2.8 trillion and income taxes $1.6 trillion.

http://www.usgovernmentrevenue.com/fed_revenue_2013USrn

Personal income of Americans in 2013 was around $14 trillion.

http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1#reqid=9&step=3&isuri=1&903=58

So, in 2013 Federal taxes as a percent of personal income was around 20 percent and federal income taxes as a percent of personal income was around 11.4 percent. If the federal government confiscated all of the income of the top five percent, it would just more than cover its entire tax revenue. Of course, it could only do this once.

Here are federal taxes paid by each income quintile:

https://www.cbo.gov/publication/44604

We have a large debt because federal spending in out of control. The top five percent do not earn enough income to make a dent in paying off the debt as long as federal government expenditures are not reduced.

[jmherbener]

The regression theorem is a necessary but not sufficient condition for something to become money. It rules out any item that has not been traded on the market and therefore, lacks exchange value against other goods (i.e., there are no prices of other goods in terms of the item). In particular, no government can merely declare a non-traded item as money and have people accept it as money. If Obama criminalized the use of the dollar and declared that a new currency, say the Obama, is now money in the USA, it would not be used by people as money. Instead, people would trade their goods and services for something that has known exchange value. So, any good that is traded in the market passes the regression theorem test and is a viable candidate to become money. But of all the traded goods, some are superior as a medium of exchange to others. Those that are already widely traded are superior to those that trade more narrowly. Durable goods are superior to perishable goods. Divisible goods are superior to indivisible goods. Portable goods are superior to stationary goods, and so on. Of all the traded goods, the most suitable good to be a medium of exchange is widely-traded, durable, divisible, portable, and so on. That is the good people choose as money.

[jmherbener]

When the Zimbabwe dollar collapsed in hyperinflation, Zimbabweans starting using foreign currencies. If the U.S. dollar were to collapse, Americans too would choose widely-traded items to use as money. Bitcoins have exchange value in the market, so they pass the regression theorem test. What they lack to be money is general saleability.

[jmherbener]

Here is the schedule for income tax brackets:

http://www.tax-brackets.org/federaltaxtable

Here is the schedule comparing income tax brackets to capital gains tax brackets:

http://kirklindstrom.com/Articles/2015/0213_US_Federal_Capital_Gains_Tax_Rates_For_2015.html

[jmherbener]

It’s well known by economists that it was a deficiency of investment and not consumption that held back production during the Great Depression. Even Keynes knew this and hence, his claim that the animal spirits (over-optimism and over-pessimism) of investors (not consumers) was the root cause of the Great Depression. Moreover, the rich have higher saving rates than the middle-class and poor. Thus, if the downturn made income and more equally distributed, then consumption would be relatively larger. Finally, the bulk of income in a market economy is in the hands of the middle-class. Therefore, aggregate consumption and investment don’t change much when the rich pull back.

Take a look at Bob Murphy’s book, A Politically Incorrect Guide to the Great Depression.

[jmherbener]

Take a look at the multi-volume work on the history of the Federal Reserve by Allan Meltzer, Here is a review of Vol. 2:

http://www.federalreserve.gov/pubs/feds/2011/201159/201159pap.pdf

On colonial tax policy, take a look at Murray Rothbard’s Conceived in Liberty:

http://library.mises.org/sites/default/files/Conceived%20in%20Liberty_Vol_2_2.pdf

Also, look careful at Rothbard’s footnotes and bibliography in Conceived in Liberty and A History of Money and Banking in the U.S. for more sources.

[jmherbener]

At this point, I think Bitcoin is, at most, a localized medium of exchange among a small number of persons. Another small group invests in Bitcoin as an asset. They are anticipating a capital gain from holding Bitcoin, like investors in real estate. To be money, an item must be accepted as a medium of exchange by most people. It is, by definition, the most widely traded item in the market. For this reason, people conduct economic calculation in money.

[jmherbener]

I have not read Clark’s book, so I’m afraid I can’t comment on his views.

[jmherbener]

Concerning the first paragraph of the response above, of course the purchasing power of money, like the price of any good, can change from either a change in demand or a change in supply. So, perhaps it’s best to used the phrase “monetary inflation” to refer to supply-driven decreases in money’s purchasing power and “price inflation” to refer to fall in money’s purchasing power.

The second paragraph of the response above fails to mention the fact that for people to increase their demand for all goods, they must either have more money or reduce their demand to hold money.

The third paragraph makes a similar oversight. Costs of production are determined by prices of inputs. Without more money or reduced demand to hold money, entrepreneurs cannot increase their demands for inputs nor consumers their demand for outputs on all inputs and outputs throughout the economy. Moreover, costs of production are determined by input prices which are themselves determined by output prices, not the other way around. Neoclassical economists call this the marginal productivity theory of input prices.

The fourth paragraph ignores the purchasing power parity theory of exchange rates. The purchasing power of a given money tends to be the same everywhere it trades, both domestically directly for domestic goods and internationally through exchange for foreign currency which is then used to buy foreign goods. Monetary inflation of a domestic currency, ceteris paribus, generates both domestic price inflation and relative devaluation of the domestic currency against foreign currencies.

[jmherbener]

Here is Roger Garrison’s response to Friedman:

https://mises.org/library/business-cycles

Also, take a look at Joe Salerno’s article which addresses misrepresentations of ABCT:

https://mises.org/library/reformulation-austrian-business-cycle-theory-light-financial-crisis-0

[jmherbener]

Rolling over debt means that an equivalent amount of new debt is taken out when old debt is paid off. So if a person rolls over $5,000 in debt, his total debt remains at its previous level.

[jmherbener]

A prominent Austrian economist currently writing on and teaching about financial markets is Guido Huelsmann.

guido.hulsmann@univ-angers.fr

The course has lessons on Money and Banking, the Time Market, Bond Markets, Stock Markets, Booms and Busts, and Business Cycles. These would be the lessons bearing directly on your interest.

Here are a few short pieces related to your topic:

https://mises.org/library/mortgage-market-mess

http://fee.org/files/docLib/122008freeman-murphy.pdf

https://mises.org/library/greenspans-bogus-defense

https://mises.org/library/are-fannie-and-freddie-too-big-fail

You might search Bob Murphy’s website:

http://consultingbyrpm.com/about

[jmherbener]

As with any good, its price rises when demand for it increases relative to supply of it. College education is heavily subsidized by governments. State governments grant direct subsidies to college and universities. Here are statistics on California subsidies to higher education, which were $14.5 billion last year:

http://www.ebudget.ca.gov/2014-15/pdf/BudgetSummary/HigherEducation.pdf

Another subsidy is through federal government Pell grants to students, which were $44 billion in 2012:

http://americanactionforum.org/sites/default/files/PrimerOnPellGrants.pdf

Then there are student loan guarantees by governments:

http://www.collegescholarships.org/loans/guaranteed.htm

Governments restrict the production and supply of higher education by chartering institutions of higher education as not-for-profit organizations.

Check out the work of Richard Vedder at the Center for College Affordability:

http://centerforcollegeaffordability.org/

[jmherbener]

For macroeconomics, take a look at the books by Snowden and Vane The Development of Modern Macroeconomics and A Macroeconomics Reader. Also, take a look at Roger Garrison’s book, Time and Money.

For microeconomics, take a look at one of the older microeconomics textbooks like C.E. Ferguson’s book, Microeconomic Theory.

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