The immorality of today’s monetary policy
I have been reading Buying at the Point of Maximum Pessimism (FT Press, 2010), by Scott Phillips. Before introducing his “six value investment trends” he devotes close to 100 pages to describe what went wrong in the US economy. When he addresses current inflationary policies, he states “Technology is amazing: a policy maker’s ability to destroy your purchasing power has never been easier.”
I am also devoting part of my reading time to The Ethics of Money Production (Mises Institute, 2008), by Jörg Guido Hülsmann, the outstanding professor and economist. This is the best book of applied moral philosophy focusing on an economic topic that I have read for some time. It is ideal to understand the immorality of the current distribution of power in monetary policy which led to Scott’s conclusion that a policy maker’s ability to destroy your purchasing power has never been easier.
Hülsmann book concludes that “We need to abolish the legal privileges of central banks and monetary authorities. There is no tenable rationale for preventing the citizens from using the best monies and money substitutes.” Both books deserve longer reviews and I will continue writing about them, but so far, both strengthen my resolve that there is a moral imperative for a monetary reform that will make political manipulations of the value of money much more difficult.
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