ZERO EQUILIBRIUM

—Compiled by Chinedu Okoye  The Problems of Credit Policy: Policies adopted by governments since the time of the currency school, with regards to fiduciary media has been guided by the idea that it is necessary to impose some sort of restrictions upon banks in order to prevent them from extending fiduciary media to the extent that it causes a rise in prices (or fall in the objective exchange-value of money) that culminates in an economic crisis. But these policies have been continually broken by "contrary aims" as endeavors have been made to keep interest rates low and prices "reasonably" high. This happened during the war and some time after. Mises gives separate considerations to the problems as they exhibited themselves before the war and after. He says that the view that note issue should be restricted somehow "In order to guard against serious evil is still accepted to-day as the essence of government wisdom in matters of banking policy...

– By Chinedu Okoye    Summary: China’s stock market rally is unfolding against a backdrop of weak consumption, strained profitability, and cautious corporate earnings, and trade uncertainty. While favorable tailwinds such as cheap energy imports, strong gold reserves, and new trade partnerships offer support, headwinds from subdued domestic demand, regulatory pressure, and trade frictions remain significant.  The divergence between rising stock prices and weaker underlying fundamentals suggests the rally may be fragile — sustained only if confidence improves or stimulus measures are expanded. China stands at a turning point where markets look forward, but the real economy has yet to catch up.   Strong Consumer, Weak Consumption: The current Chinese economic climate is characterized by a strong consumer with a low confidence, and this spills into industrial output as weaker ...

- Compiled by Chinedu Okoye  The Redemption of Fiduciary Media: Money-substitutes have a value as great as the sums of money to which they refer. However there have been banks whose solvency werent called into question "even the day before it's collapse. And as long as these events aren't erased from memory, "it must evoke some difference between the valuation of money and that to claims of money payable at any time". Such events create a lack of certain confidence in money-substitutes which could result in money-substitutes having a lower value than money. These doubts to fiduciary media, however are untenable these days. The complete equivalence of money and secure claims (substitutes), give rise to a consequence that has immediate bearings on the entire monetary system.  As exchanges, typically made through the money medium aren't always based on the transfer of money, but also the transfer or assignment of claims to money, whi...

– Compiled by Chinedu Okoye  Having ended with Mises's views on Inflationism as a monetary policy model, this part begins with his views on Deflationism –a preferred policy from Mises's point of view. Deflationism: This refers to the policy that aims to increase the objective exchange-value of money also called "Restrictionism". The idea is to not increase the money supply when demand increases or not increasing it by as much as demand, as a way of increasing the value of money. The proposal of this is to stop further increases in Money supply and wait out the effects on the value of money as demand outweighs supply. He argues tht inflationism only existed because of the "inflated fiscal motives" of the government. Inflationism is the cheapest and easiest remedy for a low state of public finances, whereas Restrictionism or Deflationism, demands "positive sacrifices from the national exchequer when it is carried out". As ...

"Oil prices fall with US-Russia talks, inflation in focus" — Investing.com ¹ Oil prices begun the week with a slide, “extending steep declines from the prior week as traders looked to upcoming talks between the U.S. and Russia heralding a cooldown in the Ukraine conflict” Also, “a host of weak economic readings in recent weeks, kept oil markets largely negative on future demand.” With President Trump imposing as much as 50% tariffs against India to stop it from buying Russian oil, threatening a similar move against China. “Chinese consumer price index inflation read flat for July, while producer price index inflation shrank past expectations, highlighting a sustained deflationary trend in the world’s biggest oil importer.” The CPI print is expected to offer more cues on the world’s biggest fuel consumer, as it faces potential price increases from Trump’s tariffs. Oil extended last week's losses in the Asian Open, owing to a combina...