Patrick Barron

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Patrick Barron is a consultant to the banking industry. He teaches Austrian school economics at the University of Iowa and Bank Managemant Simulation for the Graduate School of Banking, University of Wisconsin. Visit his blog. Send him mail.

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    More Eurozone integration will bankrupt Germany

    From today’s Open Europe news summary: Bundesbank and Bank of France Governors call for Eurozone finance ministry In a joint article for Sueddeutsche Zeitung Bundesbank President Jens Weidmann and Bank of France Governor Francois Villeroy de Galhau argue, “The current asymmetry between national sovereignty and communal solidarity is posing a danger for...

  • Blog
    Car prices are not immune to the laws of supply and demand

    A recent Daily Article from the Ludwig von Mises Institute in Auburn, Alabama titled “Is the Auto Loan Bubble Ready to Pop?” Tommy Behnke predicts that auto prices will fall as the bubble  bursts from the artificially created demand generated from excessive credit creation. Mr. Behnke points out that car production has...

  • Blog
    My letter to the NY Times re: Safety net for regulators

    Re: A Middle Ground Between Contract Worker and Employee Dear Sirs: Noam Scheiber’s report of how current labor laws cause unintended adverse consequences for new, digital companies should lead everyone to question the need for such regulations. Why not let employers and workers decide their own terms of employment? The safety net,...

  • Articles
    Splendid Isolation: A sane foreign policy for America

    A proper foreign policy for the US would be consistent with and recognize the limitations placed upon...

  • Blog
    The logic of sovereignty and unilateral free trade

    From today’s Open Europe news summary: FT: UK pushing for ‘emergency brake’ on EU laws to safeguard rights of non-Eurozone countries The Financial Times reports that the UK is seeking to obtain an ‘emergency brake’ on future EU proposals in order to protect the rights of non-Eurozone countries. This new ‘emergency brake’...

  • Blog
    My letter to the WSJ re: Two kinds of refugees, people and money

    Underground banks in China Dear Sirs: Money will flee areas where it is repressed just as people will flee areas where they are repressed. Capital controls can be seen as the monetary analogy of the Berlin Wall. Capital controls are indications of a failed economic system that benefits the politically connected elite at...

  • Blog
    Yes, Mr. Prime Minister, I can answer that question

    From Open Europe news summary of October 19, 2015: Cameron: Those who want to leave EU will have to answer question of single market access In his House of Commons statement following last week’s European Council summit, Prime Minister David Cameron said that, when it comes to EU membership, “I want Britain to...

  • Blog
    My letter to the NY Times re: My advice to the ECB and the Fed

    Re: Skepticism Prevails on Preventing Crisis Dear Sirs: Mr. Binyamin Appelbaum’s report of the Fed’s conference in Boston over the weekend perfectly illustrates our central bankers’ incompetence. They wring their hands over what they do not know and beg the public to forgive them when the next financial crisis strikes, which surely...

  • Blog
    Strict defense of private property solves the economic fact of resource scarcity

    Scarcity of resources exists in many forms and is THE problem in economics. If resources were not scarce, there would be no need to economize. The existence of scarcity is true of all resources (time, human energy, natural resources, etc.) It is not intuitive that allowing scarce resources to be owned privately...

  • Blog
    Three questions for Andrew Haldane, chief economist at the Bank of England

    Re: From ZIRP TO NIRP by Alasdair Macleod 1. What exactly is wrong with price deflation? 2. In a world of increasing productivity, are not lower prices inevitable? 3. Are not lower prices beneficial, in that all society enjoys an increasing standard of living on the same money income?

  • Blog
    Free banking vs the real bills doctrine

    The problem with the “real bills” doctrine Re: Free banking vs.the real bills doctrine I wrote the letter below to Don Boudreaux of Cafe Hayek. Under the real bills doctrine banks would be allowed to create demand deposits backed by promissory notes and not reserves. Those who adhere to this doctrine, such...

  • Blog
    My letter to the Philadelphia Inquirer re: the crude oil export ban

    Re: Debate swirls over lifting crude-oil export ban Dear Sirs: The answer to your headline question on the front of Sunday’s business section is self-evident. The crude oil export ban cannot be justified on any economic or moral basis. It is an economic myth that there can be rational economic calculation under...

  • Blog
    My letter to the NY Times re: New icebreakers to the Arctic for what purpose?

    Re: Obama Calls for More Coast Guard Icebreakers to Gain Foothold in Arctic Dear Sirs: President Obama’s call for Congress to fund new icebreakers for the Arctic is troubling. Whereas, most nations of the world see the receding icecap as an opportunity to gain cheaper access to previously inaccessible natural resources and/or...

  • Blog
    Yes, you do understand economics!

    The following conversation between my good friend Michael McKay and a friend of his illustrates that we all understand and use economic principles every day. In fact we could  not function without understanding these basic economic principles. Pat Barron   Yes, You Do Understand Economics by Michael McKay   The other day...

  • Blog
    The implications of a reduction of Chinese holdings of US government debt

    Dear Readers, Below is my response to a reader of my blog, who asked about the implications of China reducing its holdings of US treasury debt. Pat Barron Dear Lawrence, I think that in the simplest terms, China is exiting the market for US Treasuries, which means that the US government must...

  • Blog
    My letter to the Financial Times, London re: The FT sides with counterfeiters and confiscators

    Re: The case for retiring another barbarous relic Dear Sirs: I was appalled at your supposed “case” for eliminating cash, which you yourselves describe as the peoples’ “go-to safe asset”. And what IS your case? One, “cash…limits the central banks’ ability to stimulate a depressed economy.” Really? Although I am not in...

  • Blog
    My letter to The Times, London re: Legal tender laws protect unsound money

    Dear Sirs: I will not take the time required to refute point-by-point Mr. Ed Conway’s latest attack upon a gold-backed currency. It is obvious that he is completely ignorant of monetary theory and history. Rather, I will ask Mr. Conway why governments must erect legal tenders laws around their fiat currencies, using...

  • Blog
    Oh, the horror of cheaper Chinese goods!

    Re: Cheaper Chinese Currency Has Global Impact China’s money dictators have decided to put all Chinese exports on sale, allowing people in foreign countries to buy more Chinese goods for the same amount of local currency or invest in any manner of other financial transactions that will increase their quality of life...

  • Blog
    My letter to the Wall Street Journal re: A strange definition of "good news"

    Re: Consumers Prime the U.S. Pump Dear Sirs: Your definition of “good news” for the U.S. economy is defined as an increase in “real, or inflation-adjusted, personal-consumption expenditure”, which was driven by a “savings rate, which slipped to 4.8% from 5.2%.” An economy can expand only from savings; i.e., deferring consumption in...

  • Blog
    A fourth economic fallacy about Greece

    Recently I posted a short essay listing three economic fallacies about the Greek crisis. The three were (1) the euro is too strong a currency for Greece, (2) debasing its own currency will allow Greece to export its way to recovery and prosperity, and (3) instituting its own currency will allow the...