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The Deadliest Virus
THE DEADLIEST VIRUS
The deadliest virus is the institutionalized coercion which lies in the very DNA of the state and may even initially permit a government to deny the outbreak of a pandemic. Evidence has been suppressed, and heroic scientists and doctors have been harassed and silenced simply because they were the first to realize and expose the gravity of the problem. As a result, weeks and months have been lost, at an enormous cost: Hundreds of thousands of people have died due to the worldwide spread of an epidemic which, in the beginning, the shamefully manipulated official statistics made appear less dangerous that it actually was.
The deadliest virus is the existence of cumbersome bureaucracies and supranational organizations, which did not manage or wish to monitor in situ the reality of the situation, but instead endorsed the information received, while offering constant support and even praising – and thus becoming accessories to – all the coercive policies and measures adopted.
The deadliest virus is the notion that the state can guarantee our public health and universal welfare, when economic science has demonstrated the theoretical impossibility of the central planner’s giving a coherent and coordinating quality to the coercive commands it issues in its attempt to achieve its pompous objectives. This impossibility is due to the huge volume of information and knowledge which such a task would require and which the planning agency lacks. It is also, and primarily, due to the fact that the institutional coercion typical of the agency impacts the social body of human beings, who alone are capable of coordinating themselves (and do so spontaneously) and creating wealth, and thus, such coercion prevents the emergence of precisely the first-hand knowledge the state needs to bring about coordination with its commands. This theorem is known as the impossibility of economic calculation under socialism. Mises and Hayek discovered the theorem in the 1920s, and the events of world history cannot be understood without it.
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Nothing Is Guaranteed
Nothing Is Guaranteed
There are no guarantees, no matter how monumental the hubris and confidence.
The American lifestyle and economy depend on a vast number of implicit guarantees— systemic forms of entitlement that we implicitly feel are our birthright.
Chief among these implicit entitlements is the Federal Reserve can always “save the day”: the Fed has the tools to escape either an inflationary spiral or a deflationary collapse.
But there are no guarantees this is actually true. In either an inflationary spiral or deflationary collapse of self-reinforcing defaults, the Fed’s “save” would destroy the economy, which is now so fragile that any increase in interest rates (to rescue us from an inflationary spiral) would destroy our completely debt-dependent economy: were mortgage rates to climb back to historical averages, the housing bubble would immediately implode.Hello negative wealth effect, as every homeowner watches their temporary (and illusory) “wealth” dissipate before their eyes.
The Fed’s “fix” to deflationary defaults is equally destructive: bailing out too big to fail lenders will spark a political revolt that could topple the Fed itself, as the populace has finally connected the dots between the Fed bailing out the banks and financiers and the astounding rise in income and wealth inequality.
Other than the phantom “wealth” of real estate and stock bubbles, the vast majority of the ‘wealth” generated by the Fed’s actions of the past 20 years has flowed to the top 0.1%. This will become self-evident once the phantom gains of speculative bubbles vanish.
The Fed’s other “trick” to halt a deflationary collapse is negative interest rates, in effect taxing savers and those holding cash and rewarding those who borrow.Negative interest rates destroy every institution that depends on relatively low-risk interest income via bonds: pension funds, insurance companies, etc.
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