Another excellent piece from Mr Liam Halligan, in this morning’s Sunday Telegraph, who has spotted where all of that money — that Ben Bernanke has been printing — has been piling up in great snow drifts of paper. In my own Rothbardian view, this is out of the United States — before the dollar collapses — and into real commodities which cannot be printed from thin air, which will therefore keep their value in the human needs chain, even when the world’s central bankers start running all of their printing presses all of the time to create the final stage of the crack-up boom initially instigated in 1971 by Richard Nixon’s decision to engage the world in a pure fiat money experiment.
So has Chairman Bernanke created the wave of world revolution sweeping the world, with the increased food prices behind these revolutions being caused by his obsession with the printing press as the solution to all known problems?
Well, Mr Halligan is orthodox enough to avoid going quite so far as we far less restrained followers of the author of Man, Economy, and State. However, he has gone further than anyone else I have yet to read in the MSM, including even our friends at The Guardian, who tread a curious line between praising Keynesianism (i.e. money printing) to ‘grow’ worldwide economies, while at the same time decrying the world’s rises in food prices which are primarily caused by money printing (though they would prefer to say ‘freak’ weather events, to fit in with their ‘global warming’ paradigm which has been causing all of this deep snow and freezing temperatures in North America).
Oh what it must be, to be a writer on The Guardian. You’re half right, half the time, but the socialist world view keeps making you miss the punchbag, even though it is standing right there in front of you. Poor loves.
Getting back to the brave Mr Halligan, here are three cherry-picked quotes to tempt you to read his full piece.
We start with the good:
“Fears about events in Egypt disrupting the Suez canal may also be overdone. This iconic supply route remains open and is now augmented by the more important Suez-Mediterranean pipeline. Given the predominance of Asian rather than Western demand these days, the Suez route out of the Middle East is anyway of much less relevance to global crude markets than it was back in the 1950s.”
Now for the bad, which includes a great Misesian word (for bonus marks, see if you can spot it):
“Despite this relentless demand, commodity supply chains – including mines, wells and processing plants – have lately been hit by a lack of capital investment, courtesy of the credit crunch. That’s why the prices of many economically-important commodities – not only sugar and cotton, but also copper, palladium and tin – are already well above their mid-2008 peaks. It strikes me as axiomatic that crude will eventually follow.”
And here’s the plain downright ugly:
“Consider also that crude reached almost $150 a barrel in 2008 without the hideous backdrop of a potential implosion of the Middle East. In 2008, the world had also yet to witness the grotesque Western policy of virtual money printing – or ‘quantitative easing’.”