How did this nation survive for as long as it did (right up to 1913) without monetary central planners? Not only did it survive, it thrived. Funny, but for all the central planning since, we don’t currently seem to be thriving. From MN Gordon at economicprism.com:
These days Emerson’s critical insight is being taken to its extreme. Consumers, many whom lost their jobs due to government lockdown orders, no longer produce. Yet they still consume. They’re expensive. Not rich.
What’s more, this consumption is not funded through personal savings. Nor is it funded through government transfer payments. Rather, it’s funded via the printing press.
Emerson, no doubt, was lacking in the unique perspective we’re presently granted. He didn’t have the special opportunity to watch his government destroy the economy in short order. Perhaps if he had, he would have penned a neat axiom to distill the essence of what has happened.
The world today looks nothing like Emerson’s day. The 19th century was an age of honest money. Central bankers did not roam the land.
Printing money to buy bonds and stocks, and to sprinkle on people, would have been quickly dismissed. The experience of the Continental Congress during the American Revolution, and their over issuance of paper “continentals”, had shown that resorting to the printing press was an act of suicide.
Currently, printing press money is considered enlightened central banking policy. Inflation targets, zero interest rate policy (ZIRP), direct bond purchases, twisting the yield curve, unlimited credit. This is merely a partial list of the trouble central bankers are up to.
Despite all the well-meaning intentions they may have, the efforts of central bankers in 2020, let alone the 21st century, have been a disaster. Where to begin…