Mark Thornton on creeping inflation

Episode 93: GoldMoney’s Andy Duncan talks to Professor Mark Thornton, Senior Fellow at the Ludwig von Mises Institute, about a recent Mises Daily article he wrote entitled, ‘Where Is the Inflation?‘, which explains how monetary inflation is seeping into the US economy.

They also discuss the Federal Reserve’s policy of recapitalising and protecting America’s “Mega Banks”, and what this policy means for the future gold price. In the second half of the interview, they discuss the Irish economist Richard Cantillon. Cantillon was heavily involved in the Mississippi bubble in pre-revolutionary France, and his book – first written in 1730 – was the first truly modern treatise on economics. Professor Thornton edited a recent translation of this book: An Essay on Economic Theory.

They wrap up the interview by discussing the Professor’s latest works on the economics of prohibition.

This podcast was recorded on 23 January and previously published at


  • Gary says:

    The EFFECTS of inflation are currently in the sovereign bond market. The unholy triad of banks , the govt and the central bank in a frenzied dealing in govt debt. The velocity is all in that trade. The money is still all out there. When the bond market bursts, which in the case of gilts is at a 300 year high, then we probably get currency repudiation. Currency collapse.

  • Paul Marks says:

    Richard Cantillon was indeed an important monetary economist – and like all monetary economists who actually got things right (as opposed to getting them wrong) he is not taught in the universities.

    From the point of view of POLITICAL economy, Cantillon pointed out a vital fact – that even at the end of the boom-bust event (caused by credit-money expansion) things do not totally go back to the way they were.

    Certain people are better off than they would have been (had no boom-bust event occured) and a lot of other people are worse off than they would have been (had no boom-bust event occured).

    And the few people who benefit (at the end of the boom-bust) tend to be a lot better off than the many people who lose (at the end of the boom-bust).

    I suspect that this is the key to why governments (and Central Banks) continue to support credit-money expansions. It is done in the name of the poor – but certain wealthy interests (for example in the bankinig industry) are the ones who really benefit, and they push it.

    By the way it is not a zero sum game – it is a NEGATIVE sum game.

    The people who (in the end) lose by the boom-bust, are hurt more (in total) than the people who benefit (in the end) from the boom-bust benefit from it.

    The economy as a whole (in the end) loses from a policy of monetary expansion. Of the Fool’s Gold that one can lend more money than has come from REAL SAVINGS.

  • Jack Adams says:

    11.55 AD “Yeah we have whole generations of people here in the UK who do not know what a proper job is.”

    This is quite an homogenous statement to make, whilst it seems specific it is possible to see it spilling over. If we have a huge problem with generationally embedded unemployement, and I believe that is just one of the icebergs ripping at our hull, then we also have a problem with the jobs dependent on administrating this loss on our national balance sheet.

    Prior to Andy making this statement, Mark Thornton was talking about government administration. For a moment, when Andy made the point about people not knowing what a proper job was I thought he was talking about civil servants. Surely it is equally true that we have grown inter-generational bureaucrats who are busy draining tax payers money into salaries and pension schemes in order to administer the further drain of tax payers money into subsidising non-productivity.

    We have a whole “industrial section” of our economy focused entirely on not producing anything other than cost. This includes the civil servants who, I would argue, have no idea what a proper job is any more than their clients.

    At the very root of our problem is the slogan “From Cradle to Grave”. This early marketing disaster gave rise to the destruction of ambition, the eradication of need and the undermining of will in individuals, families, tribes and even politics itself. This last point is important for where exactly is the political ambition, need or will to seriously tackle the fact that we are pouring our national wealth into a loss making enterprise; The Welfare State.

    Andy is right to talk about generations unfamiliar with meaningful work. Am I right to extend this idea into the bureaucracy and politics?

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