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Stablecoins: The Next Gold Rush? – Article by Adam Alonzi

Stablecoins: The Next Gold Rush? – Article by Adam Alonzi

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Adam Alonzi

What money should be has been explored by more than one economist. What it is, strange as it may sound, is also up for debate. Yet amidst these disputes, practical and abstract, there is consensus.

At this time the entire crypto market is valued between 380 and 560 billion USD. The value of all the world’s stocks is around 70 trillion USD. The daily volume of the Forex is 5.1 trillion USD. Despite the excitement it periodically sparks in mass media and high finance circles, crypto is barely a drop in the bucket.

As I stated in my response to Robert Shiller’s critique of Bitcoin, tokenization is a means of dividing an asset. Tokenization, easily dividing an asset among stakeholders, is a strength of blockchain technology. Tokens can represent abstract entities issued on the blockchain, but they can also be tethered to a piece of real estate, a work of art, a trademark, or a freighter of Chilean copper.

A Stablecoin is related to this concept. A Stablecoin (SC) is a cryptocurrency that is pegged to fiat currency or a commodity in a fixed ratio. Stablecoins are being developed by massive corporations like JPMorgan Chase and are being looked into by governments around the world. The backing of mature institutions, whatever your opinion may be of them, can give crypto credibility and capital to move forward.

At this time cryptocurrencies are for the most part speculative toys or safe havens for those expecting for the fiat system to implode. In any case, common use remains elusive. While milk and eggs can be bought with crypto, it is not a normal occurrence. The major barrier to this is volatility.

Stability could come after a stampede into crypto by a reasonable percentage of the world’s population. Some authors have claimed an economic catastrophe could precipitate an exodus from fiat, but this seems to spring from wishful thinking – the same sort gold bugs have been indulging in for the last half century.

This is not meant as disparagement of gold or its advocates. Gold is a fine investment, but the issue at hand here is common use, something gold is not likely to readily lend itself to ever again – at least not in its most familiar forms. Several Stablecoins are currently backed by gold. By doing so, they combine the benefits of crypto with the timeless tangibility of precious metals.

Stablecoins are digital representatives of an item that may not be readily divisible and therefore inconvenient or impossible to use for daily transactions. Very few shoppers would want to overnight a tiny gold nugget to an eBay seller. Those hoping for a speedy ingress of users should consider that an equally rapid egress could follow.

Slow and steady wins the race?

While more users and more merchants could curb price swings, how and when this will happen remains an open question. If stability is not established, at least for long enough to secure investor confidence, conventional cryptocurrencies will never outgrow their reputations as dangerous playthings.

Some members of the crypto community are philosophically opposed to Stablecoins because they betray the vision of total decentralization. High ideals can clash with reality. Decentralization is not a strong selling point for most folks. It is not easy to explain beyond “no one controls it”, which is as likely to make them feel uneasy as it is to instill confidence.

It’s not as though Stablecoins are taking anything from the crypto community. Aside from bringing in new converts, they also add diversity to the cryptosphere. An orchard of identical apple trees is doomed when the right pest arrives. Monocultures are inherently weak. A diverse financial ecosystem is a resilient one. The proliferation of new blockchain projects, as overwhelming as it may be, is good for all of us.

There are a plethora of cryptocurrencies aiming to be “just” mediums of exchange. Monero (XMR), Ripple (XRP), and Dash (DASH), for all their differences, are innovating and are finding their niches. Anonymity, speed, and low transaction fees are attractive, but is it enough to convince Uncle Fred to begin buying his sweaters with them?

Although some have nuanced algorithms managing their supply, Stablecoins make crypto more understandable to the average person. Finance and technology are boogeymen to most consumers; there is no need to make either more arcane or frightening than necessary.

Adolescence is difficult because we feel pressured, from within or without, to choose a path. We are under the impression that our choices are final and our one-dimensional trajectories are set. Whether Stablecoins are a passing phase or a critical bridge to the materialization of Satoshi Nakamoto’s original vision, they seem poised to become permanent fixtures in high finance and daily life.

Adam Alonzi is a writer, biotechnologist, documentary maker, futurist, inventor, programmer, and author of the novels A Plank in Reason and Praying for Death: A Zombie Apocalypse. He is an analyst for the Millennium Project, the Head Media Director for BioViva Sciences, and Editor-in-Chief of Radical Science News. Listen to his podcasts here. Read his blog here.

What That Giant Asteroid of Gold Would Really Do to the Economy – Article by David Youngberg

What That Giant Asteroid of Gold Would Really Do to the Economy – Article by David Youngberg

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David Youngberg

July 22, 2019

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In Greek mythology, Psyche was a woman of such beauty that she inspired jealousy in the love goddess Venus. The 19th-century Italian astronomer Annibale de Gasparis named a massive asteroid after her. How appropriate that it turns out that 16 Psyche, one of the biggest asteroids in the asteroid belt, is made out of a metal famous for inspiring lust: gold.

Unlike gold discoveries of the past, there’s no rush to harvest Psyche. NASA wants to send a probe only to study it, prompting several articles to erroneously breathe a sigh of relief. According to one:

….if we carried [Psyche] back to Earth, it would destroy commodity prices and cause the world’s economy – worth $75.5 trillion – to collapse.

No one tries to explain how cheap gold would cause an economic collapse, and for good reason: it wouldn’t.

Psyche has a lot of gold—about $10,000 quadrillion worth at current prices. The eye-catching headlines that claim it’s enough gold to make “everyone on earth a billionaire” are, of course, complete fantasy. Selling that much gold would cut prices nearly to zero.

Harvesting Psyche would not cause an economic collapse.

If gold was still used for money, that much gold would create massive inflation, resulting in a lot of economic hardship. No country uses the gold standard anymore, so that’s hardly a concern. Rock-bottom gold prices would certainly be devastating for gold mining companies and people who keep their wealth in gold bars. That’s really bad for them, but they’re a tiny part of the global economy.

Perhaps the confusion rests in simple reverse causation. Recessions definitely cause lower commodity prices, but lower commodity prices cause recessions no more than umbrellas cause rain.

Harvesting Psyche would not cause an economic collapse. If that much gold could cheaply be brought to market it would be a boon, not a bust. It’s impossible to predict what a world of cheap gold would look like, but the story of aluminum gives us a hint.

Even though it’s the most abundant metal on the planet, most aluminum is trapped in bauxite and was difficult to purify for most of human history. Pure aluminum was incredibly rare, and there was once a time when the stuff of soda cans was more precious than gold. Aluminum bars were displayed next to the French crown jewels, and pure aluminum caps the Washington Monument.

Cheap gold probably won’t give us an economic boom, but that doesn’t mean it wouldn’t be an economic boon.

Techniques like the Hall–Héroult process changed all that. What was once the metal of monarchs and monuments became readily available to everyone. It’s so cheap that we now use it in fishing boats, airplanes, and beer kegs. Its foil version keeps food fresh—we throw aluminum away all the time.

Making aluminum cheap didn’t cause an economic collapse. Quite the opposite. It made society wealthier because refining improvements made everything else cheaper, thereby creating new opportunities. Wood that once went for beer kegs could be used for something else. Aluminum boats don’t corrode in water, and this application freed up steel and timber that would otherwise be used to replace degrading vessels. Modern airplanes wouldn’t even be possible without aluminum, and their existence frees up fuel, time, and materials that would have otherwise gone to passenger ships and trains.

True wealth is not found in precious metals, and Bloomberg’s Noah Smith rightly points out that harvesting Psyche won’t cause a new industrial revolution. But he goes too far when he claims that it won’t make society richer because, holding everything else constant, a cheaper resource is the definition of economic progress. It’s only a question of magnitude.

If a future entrepreneur were to harvest Psyche, it would certainly be devastating to the gold industry. For everyone else, it would be a stellar improvement.

Harvesting Psyche, if it can be harvested at the right price (a big if), would make society richer because that much gold would allow us to reallocate our efforts to other endeavors. No one knows what exact effects cheap gold would have because the price of gold has never been anywhere near zero. While gold has limited production applications now, who knows how people will adapt if gold is functionally free? There are substitutes, and there are substitutes for substitutes.

Gold, for example, is incredibly ductile and an excellent conductor of electricity; perhaps houses would be wired with gold instead of copper, freeing up copper that could be used in other ways. Or maybe there’s an industry that’s only possible with cheap gold, like aviation is for aluminum. We can’t look at how gold is used now, with its sky-high price, and assume it’ll be the same with a rock-bottom price. Cheap gold probably won’t give us an economic boom, but that doesn’t mean it wouldn’t be an economic boon.

If a future entrepreneur were to harvest Psyche, it would certainly be devastating to the gold industry. For everyone else, dirt-cheap gold would be a stellar improvement.


David Youngberg is an associate professor of economics at Montgomery College in Rockville, MD.

This article was originally published on FEE.org. Read the original article.

Abstract Orderism Fractal 73 – Art by Gennady Stolyarov II

Abstract Orderism Fractal 73 – Art by Gennady Stolyarov II

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Abstract Orderism Fractal 73 – by Gennady Stolyarov II

Note: Left-click on this image to get a full view of this digital work of fractal art.

This fractal is a set of nested, ornamented domes complemented by swirl patterns on both macro and micro scales.

This digital artwork was created by Mr. Stolyarov in Apophysis, a free program that facilitates deliberate manipulation of randomly generated fractals into intelligible shapes.

This fractal is an extension of Mr. Stolyarov’s artistic style of Abstract Orderism, whose goal is the creation of abstract objects that are appealing by virtue of their geometric intricacy — a demonstration of the order that man can both discover in the universe and bring into existence through his own actions and applications of the laws of nature.

Fractal art is based on the idea of the spontaneous order – which is pivotal in economics, culture, and human civilization itself. Now, using computer technology, spontaneous orders can be harnessed in individual art works as well.

See the index of Mr. Stolyarov’s art works.

Fractal of 85 – Art by Gennady Stolyarov II

Fractal of 85 – Art by Gennady Stolyarov II

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Fractal of 85 – by G. Stolyarov II

Note: Left-click on this image to get a full view of this digital work of fractal art.

This fractal was created by Gennady Stolyarov II as a present from one mathematician to another, based on 85-fold rotational symmetry for the 85th Birthday of his grandfather and namesake, Gennady Stolyarov I, on October 24, 2018. Notice how the rings can continue to stack along their orbit.

Gennady Stolyarov I, upon seeing the fractal, remarked that it illustrated to him that an entire lifetime is indeed long. However, in the view of Gennady Stolyarov II, it should be made even longer!

This digital artwork was created by Mr. Stolyarov in Apophysis, a free program that facilitates deliberate manipulation of randomly generated fractals into intelligible shapes.

This fractal is an extension of Mr. Stolyarov’s artistic style of Abstract Orderism, whose goal is the creation of abstract objects that are appealing by virtue of their geometric intricacy — a demonstration of the order that man can both discover in the universe and bring into existence through his own actions and applications of the laws of nature.

Fractal art is based on the idea of the spontaneous order – which is pivotal in economics, culture, and human civilization itself. Now, using computer technology, spontaneous orders can be harnessed in individual art works as well.

See the index of Mr. Stolyarov’s art works.

The Federal Reserve Is, and Always Has Been, Politicized – Article by Ron Paul

The Federal Reserve Is, and Always Has Been, Politicized – Article by Ron Paul

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The New Renaissance HatRon Paul
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Audit the Fed recently took a step closer to becoming law when it was favorably reported by the House Committee on Oversight and Government Reform. This means the House could vote on the bill at any time. The bill passed by voice vote without any objections, although Fed defenders did launch hysterical attacks on the bill during the debate as well as at a hearing on the bill the previous week.

One representative claimed that auditing the Fed would result in rising interest rates, a stock market crash, a decline in the dollar’s value, and a complete loss of confidence in the US economy. Those who understand economics know that all of this is actually what awaits America unless we change our monetary policy. Passing the audit bill is the vital first step in that process, since an audit can provide Congress a road map to changing the fiat currency system.

Another charge leveled by the Fed’s defenders is that subjecting the Fed to an audit would make the Fed subject to political pressure. There are two problems with this argument. First, nothing in the audit bill gives Congress or the president any new authority to interfere in the Federal Reserve’s operations. Second, and most importantly, the Federal Reserve has a long history of giving in to presidential pressure for an “accommodative” monetary policy.

The most notorious example of Fed chairmen tailoring monetary policy to fit the demands of a president is Nixon-era Federal Reserve Chair Arthur Burns. Burns and Nixon may be an extreme example — after all no other president was caught on tape joking with the Fed chair about Fed independence, but every president has tried to influence the Fed with varying degrees of success. For instance, Lyndon Johnson summoned the Fed chair to the White House to berate him for not tailoring monetary policy to support Johnson’s guns-and-butter policies.

Federal Reserve chairmen have also used their power to shape presidential economic policy. According to Maestro, Bob Woodward’s biography of Alan Greenspan, Bill Clinton once told Al Gore that Greenspan was a “man we can deal with,” while Treasury Secretary Lloyd Bentsen claimed the Clinton administration and Greenspan’s Fed had a “gentleman’s agreement” regarding the Fed’s support for the administration’s economic policies.

The Federal Reserve has also worked to influence the legislative branch. In the 1970s, the Fed organized a campaign by major banks and financial institutions to defeat a prior audit bill. The banks and other institutions who worked to keep the Fed’s operations a secret are not only under the Fed’s regulatory jurisdiction, but are some of the major beneficiaries of the current monetary system.

There can be no doubt that, as the audit bill advances through the legislative process, the Fed and its allies will ramp up both public and behind-the-scenes efforts to kill the bill. Can anyone dismiss the possibility that Janet Yellen will attempt to “persuade” Donald Trump to drop his support for Audit the Fed in exchange for an “accommodative” monetary policy that supports the administration’s proposed spending on overseas militarism and domestic infrastructure?

While auditing the Fed is supported by the vast majority of Americans, it is opposed by powerful members of the financial elite and the deep state. Therefore, those of us seeking to change our national monetary policy must redouble our efforts to force Congress to put America on a path to liberty, peace, and prosperity by auditing, then ending, the Fed.

Ron Paul, MD, is a former three-time Republican candidate for U. S. President and Congressman from Texas.

This article is reprinted with permission from the Ron Paul Institute for Peace and Prosperity.

Arizona Challenges the Fed’s Money Monopoly – Article by Ron Paul

Arizona Challenges the Fed’s Money Monopoly – Article by Ron Paul

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The New Renaissance HatRon Paul
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History shows that, if individuals have the freedom to choose what to use as money, they will likely opt for gold or silver.

Of course, modern politicians and their Keynesian enablers despise the gold or silver standard. This is because linking a currency to a precious metal limits the ability of central banks to finance the growth of the welfare-warfare state via the inflation tax. This forces politicians to finance big government much more with direct means of taxation.

Despite the hostility toward gold from modern politicians, gold played a role in US monetary policy for sixty years after the creation of the Federal Reserve. Then, in 1971, as concerns over the US government’s increasing deficits led many foreign governments to convert their holdings of US dollars to gold, President Nixon closed the gold window, creating America’s first purely fiat currency.

America’s 46-year experiment in fiat currency has gone exactly as followers of the Austrian school predicted: a continuing decline in the dollar’s purchasing power accompanied by a decline in the standard of living of middle- and working-class Americans, a series of Federal Reserve-created booms followed by increasingly severe busts, and an explosive growth in federal-government spending. Federal Reserve policies are also behind much of the increase in income inequality.

Since the 2008 Fed-created economic meltdown, more Americans have become aware of the Federal Reserve’s responsibility for America’s economic problems. This growing anti-Fed sentiment is one of the key factors behind the liberty movement’s growth and represents the most serious challenge to the Fed’s legitimacy in its history. This movement has made “Audit the Fed” into a major national issue that is now closer than ever to being signed into law.

Audit the Fed is not the only focus of the growing anti-Fed movement. For example, this Wednesday the Arizona Senate Finance and Rules Committees will consider legislation (HB 2014) officially defining gold, silver, and other precious metals as legal tender. The bill also exempts transactions in precious metals from state capital-gains taxes, thus ensuring that people are not punished by the taxman for rejecting Federal Reserve notes in favor of gold or silver. Since inflation increases the value of precious metals, these taxes give the federal government one more way to profit from the Federal Reserve’s currency debasement.

HB 2014 is a very important and timely piece of legislation. The Federal Reserve’s failure to reignite the economy with record-low interest rates since the last crash is a sign that we may soon see the dollar’s collapse. It is therefore imperative that the law protect people’s right to use alternatives to what may soon be virtually worthless Federal Reserve notes.

Passage of HB 2014 would also send a message to Congress and the Trump administration that the anti-Fed movement is growing in influence. Thus, passage of this bill will not just strengthen movements in other states to pass similar legislation; it will also help build support for the Audit the Fed bill and legislation repealing federal legal tender laws.

This Wednesday I will be in Arizona to help rally support for HB 2014, speaking on behalf of the bill before the Arizona Senate Finance Committee at 9:00 a.m. I will also be speaking at a rally at noon at the Arizona state capitol. I hope every supporter of sound money in the Phoenix area joins me to show their support for ending the Fed’s money monopoly.

Ron Paul, MD, is a former three-time Republican candidate for U. S. President and Congressman from Texas.

This article is reprinted with permission from the Ron Paul Institute for Peace and Prosperity.

Alan Greenspan Admits Ron Paul Was Right About Gold – Article by Ryan McMaken

Alan Greenspan Admits Ron Paul Was Right About Gold – Article by Ryan McMaken

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The New Renaissance Hat
Ryan McMaken
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In the next issue of The Austrian, David Gordon reviews Sebatian Mallaby’s new book, The Man Who Knew, about the career of Alan Greenspan. Mallaby points out that prior to his career at the Fed, Greenspan exhibited a keen understanding of the gold standard and how free markets work. In spite of this contradiction, Mallaby takes a rather benign view toward Greenspan.

However, in his review, Gordon asks the obvious question: If Greenspan knew all this so well, isn’t it all the more worthy of condemnation that Greenspan then abandoned these ideas so readily to advance his career?

Perhaps not surprisingly, now that his career at the Fed has ended, Old Greenspan — the one who defends free markets — has now returned.

This reversion to his former self has been going on for several years, and Greenspan reiterates this fact yet again in a recent interview with Gold Investor magazine. Greenspan is now a fount of sound historical information about the historical gold standard:

I view gold as the primary global currency. It is the only currency, along with silver, that does not require a counterparty signature. Gold, however, has always been far more valuable per ounce than silver. No one refuses gold as payment to discharge an obligation. Credit instruments and fiat currency depend on the credit worthiness of a counterparty. Gold, along with silver, is one of the only currencies that has an intrinsic value. It has always been that way. No one questions its value, and it has always been a valuable commodity, first coined in Asia Minor in 600 BC.

The gold standard was operating at its peak in the late 19th and early 20th centuries, a period of extraordinary global prosperity, characterised by firming productivity growth and very little inflation.

But today, there is a widespread view that the 19th century gold standard didn’t work. I think that’s like wearing the wrong size shoes and saying the shoes are uncomfortable! It wasn’t the gold standard that failed; it was politics. World War I disabled the fixed exchange rate parities and no country wanted to be exposed to the humiliation of having a lesser exchange rate against the US dollar than itenjoyed in 1913.

Britain, for example, chose to return to the gold standard in 1925 at the same exchange rate it had in 1913 relative to the US dollar (US$4.86 per pound sterling). That was a monumental error by Winston Churchill, then Chancellor of the Exchequer. It induced a severe deflation for Britain in the late 1920s, and the Bank of England had to default in 1931. It wasn’t the gold standard that wasn’t functioning; it was these pre-war parities that didn’t work. All wanted to return to pre-war exchange rate parities, which, given the different degree of war and economic destruction from country to country, rendered this desire, in general, wholly unrealistic.

Today, going back on to the gold standard would be perceived as an act of desperation. But if the gold standard were in place today we would not have reached the situation in which we now find ourselves.

Greenspan then says nice things about Paul Volcker’s high-interest-rate policy:

Paul Volcker was brought in as chairman of the Federal Reserve, and he raised the Federal Fund rate to 20% to stem the erosion [of the dollar’s value during the inflationary 1970s]. It was a very destabilising period and by far the most effective monetary policy in the history of the Federal Reserve. I hope that we don’t have to repeat that exercise to stabilise the system. But it remains an open question.

Ultimately, though, Greenspan claims that central-bank policy can be employed to largely imitate a gold standard:

When I was Chair of the Federal Reserve I used to testify before US Congressman Ron Paul, who was a very strong advocate of gold. We had some interesting discussions. I told him that US monetary policy tried to follow signals that a gold standard would have created. That is sound monetary policy even with a fiat currency. In that regard, I told him that even if we had gone back to the gold standard, policy would not have changed all that much.

This is a rather strange claim, however. It is impossible to know what signals a gold standard “would have” created in the absence of the current system of fiat currencies. It is, of course, impossible to recreate the global economy under a gold standard in an economy and guess how the system might be imitated in real life. This final explanation appears to be more the sort of thing that Greenspan tells himself so he can reconcile his behavior at the fed with what he knows about gold and markets.

Nor does this really address Ron Paul’s concerns, expressed for years, toward Greenspan and his successors. Even if monetary policymakers were attempting to somehow replicate a gold-standard environment, Paul’s criticism was always that the outcome of the current monetary regime can be shown to be dangerous for a variety of reasons. Among these problems are enormous debt loads and stagnating real incomes due to inflation. Moreover, thanks to Cantillon effects, monetarily-induced inflation has the worst impact on lower-income households.

Even Greenspan admits this is the case with debt: “We would never have reached this position of extreme indebtedness were we on the gold standard, because the gold standard is a way of ensuring that fiscal policy never gets out of line.”

Certainly, debt loads have taken off since Nixon closed the gold window in 1971, breaking the last link with gold:

Ryan W. McMaken is the editor of Mises Daily and The Free Market. He has degrees in economics and political science from the University of Colorado, and was the economist for the Colorado Division of Housing from 2009 to 2014. He is the author of Commie Cowboys: The Bourgeoisie and the Nation-State in the Western Genre. 

This article was published on Mises.org and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.

The Fallacy of “Buy Land — They’re Not Making Any More” – Article by Peter St. Onge

The Fallacy of “Buy Land — They’re Not Making Any More” – Article by Peter St. Onge

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The New Renaissance Hat
Peter St. Onge
September 21, 2015
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“Buy land — they’re not making any more!” is an old investing chestnut, and a common sense one to boot. Economically, it’s also completely false.

As counterintuitive as it may seem, we make land all the time. It just doesn’t look like land.

Why? Because land’s value doesn’t come from its ability to cover up the naked earth. Land’s value comes from its economic usefulness. From the value of things that can be done using that land (Rothbard’s “marginal revenue product” of the land). And that value is, indeed, changing all the time. Economically, from a price perspective, then, we make land all the time.

Step back a moment and ask why land has value anyway. Why do people want land? Well, obviously, because you can put stuff there — including yourself — plus buildings, swimming pools, and factories.

Now, anybody who’s visited West Texas knows there is plenty of building space in the world. You could drive for hours and meet nobody. There’s lots of space for that factory of yours. But it’s not really space itself that makes land valuable. It’s location. As in, there’s only so much room in Manhattan. Or Central London.

Once again, though, it’s not the actual space that matters. It’s the access. Put a strip mall on Manhattan surrounded by crocodile-filled moats and snipers and it will have low value. The value is in access. So Manhattan is valuable because it’s easy to get to other parts of Manhattan. And it’s easy for other people to get to you. Customers, partners, and friends can all easily visit you if your apartment or office is in Manhattan, moatless and sniperless.

So if it’s the access that matters, are they making new access? Of course. They’re doing it all the time.

New highways, new exits, new streets, mass transit, pedestrian malls are being regularly constructed. These all effectively “make new land” because they offer access to existing space. They turn relatively “dead zones” into “useful zones,” or new land.

What are some of the meta-trends on land as investment, then?

First: roads. This was a bigger value-driver a generation ago in the US, as new roads made the suburbs more accessible, helping to drain many cities even as US population grew. Outside the US (Mexico, Thailand, Russia), new roads are still a big deal, and even in the US, new highways can reshape values — draining old neighborhoods and building value in new ones. The decline of cities like Baltimore or Detroit are partly thanks to those beautiful roads that redistribute access to the suburbs.

Second: population. In the US “rust belt” of declining manufacturing, many regions have dropped in price simply because people are leaving. Detroit homes for $100 is emblematic, although of course there are also political reasons some cities are so cheap — in particular, taxes and crime.

And that brings us to politics. Real estate can be cheapened shockingly quickly by taxes and crime, and those traditional drivers have been joined in recent decades by environmental politics.

Environmentalists, by taking land off the market, effectively squeeze the remaining accessible locations, driving up the price. Regions like Seattle or San Francisco are poster children of this environmental squeeze, with modest homes even in remote suburbs costing upward of a million dollars. On the other extreme, cities like Dallas or Houston have kept prices down despite exploding populations by allowing farmland to be converted to residential, commercial, or industrial use.

Beyond the access and political angles, land is also vulnerable to “network effects.” In other words, the neighbors matter. Gentrification or urban decay can be hard to predict. Even in a compact city with rising population like Washington, DC, it can be hard to predict where the middle class or rich want to colonize, and where they want to flee.

There are clues, of course — in large US cities, gays moving into a neighborhood, new coffee shops or art galleries are some leading indicators that property prices might swing up. But gentrification has it’s own mind; even in a booming city it might go into some other neighborhood. New York’s Harlem or Silicon Valley’s East Palo Alto are two very accessible locations with low prices because of perceptions of the neighbors.

So, while they’re not “making” land, they are constantly making things that affect land price: access, regulations, changing neighbors. These are the kinds of factors that make land valuable, not it’s ability to cover the earth.

And so land comes back to earth, joining boring old commodities like wheat or copper. Just as vulnerable to changing supply and demand factors.

And if you are looking for something they’re not “making more of?” Well, gold does come close – hence its appeal. They do mine new gold all the time, but the costs are high enough that gold is a very “inelastic” commodity. It comes close to “they’re not making more.”

Beyond that? Develop your ultimate resource: yourself.

Peter St. Onge is an assistant professor at Taiwan’s Fengjia University College of Business. He blogs at Profits of Chaos.
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This article was published on Mises.org and may be freely distributed, subject to a Creative Commons Attribution United States License, which requires that credit be given to the author.
Golden Whorl – Fractal Art by Wendy Stolyarov

Golden Whorl – Fractal Art by Wendy Stolyarov

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Golden Whorl I - by Wendy Stolyarov

Golden Whorl – by Wendy Stolyarov

Note: Left-click on this image to get a full view of this digital work of fractal art.

An intricate, intertwined, interlocking interplay of light and geometry, created using the program Chaotica.

See the index of Wendy Stolyarov’s art works. 

Visit Wendy Stolyarov’s website and view her art portfolio.

Wendy D. Stolyarov is an accomplished writer, thinker, artist, and graphic designer, who brings her immense talent and capacity for innovation to The Rational Argumentator and the wider movement for the advancement of Reason, Rights, and Progress. Mrs. Stolyarov uses computer technology masterfully to produce precise, realistic, life-affirming art. She has also contributed multiple essays to TRA and designed many of the magazine’s newer logos, including its banner and the New Renaissance top hat. Mrs. Stolyarov is married to G. Stolyarov II, the Editor-in-Chief of The Rational Argumentator and The Progress of Liberty. She is the illustrator for Death is Wrong, the children’s book on indefinite life extension written by Mr. Stolyarov in 2013. 

Will Seizure of Russian Assets Hasten Dollar Decline? – Article by Ron Paul

Will Seizure of Russian Assets Hasten Dollar Decline? – Article by Ron Paul

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The New Renaissance HatRon Paul
June 23, 2015
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While much of the world focused last week on whether or not the Federal Reserve was going to raise interest rates, or whether the Greek debt crisis would bring Europe to a crisis, the Permanent Court of Arbitration in The Hague awarded a $50 billion judgment to shareholders of the former oil company Yukos in their case against the Russian government. The governments of Belgium and France moved immediately to freeze Russian state assets in their countries, naturally provoking the anger of the Russian government.

The timing of these actions is quite curious, coming as the Greek crisis in the EU seems to be reaching a tipping point and Greece, having perhaps abandoned the possibility of rapprochement with Europe, has been making overtures to Russia to help bail it out of its mess. And with the IMF’s recent statement pledging its full and unconditional support to Ukraine, it has become even more clear that the IMF and other major multilateral institutions are not blindly technical organizations, but rather are totally subservient lackeys to the foreign policy agenda emanating from Washington. Toe the DC party line and the internationalists will bail you out regardless of how badly you mess up, but if you even think about talking to Russia you will face serious consequences.

The United States government is desperately trying to cling to the notion of a unipolar world, with the United States at its center dictating foreign affairs and monetary policy while its client states dutifully carry out instructions. But the world order is not unipolar, and the existence of Russia and China is a stark reminder of that. For decades, the United States has benefited as the creator and defender of the world’s reserve currency, the dollar. This has enabled Americans to live beyond their means as foreign goods are imported to the US while increasingly worthless dollars are sent abroad. But is it any wonder after 70-plus years of a depreciating dollar that the rest of the world is rebelling against this massive transfer of wealth?

The Europeans tried to form their own competitor to the dollar, and the resulting euro is collapsing around them as you read this. But the European Union was never considered much of a threat by the United States, existing as it does within Washington’s orbit. Russia and China, on the other hand, pose a far more credible threat to the dollar, as they have both the means and the motivation to form a gold-backed alternative monetary system to compete against the dollar. That is what the US government fears, and that is why President Obama and his Western allies are risking a cataclysmic war by goading Russia with these politically motivated asset seizures. Having run out of carrots, the US is resorting to the stick.

The US government knows that Russia will not blithely accept Washington’s dictates, yet it still reacts like a petulant child flying into a tantrum whenever Russia dares to exert its sovereignty. The existence of a country that won’t kowtow to Washington’s demands is an unforgivable sin, to be punished with economic sanctions, attempting to freeze Russia out of world financial markets; veiled threats to strip Russia’s hosting of the 2018 World Cup; and now the seizure of Russian state assets.

Thus far the Russian response has been incredibly restrained, but that may not last forever. Continued economic pressure from the West may very well necessitate a Sino-Russian monetary arrangement that will eventually dethrone the dollar. The end result of this needless bullying by the United States will hasten the one thing Washington fears the most: a world monetary system in which the US has no say and the dollar is relegated to playing second fiddle.

Ron Paul, MD, is a former three-time Republican candidate for U. S. President and Congressman from Texas.

This article is reprinted with permission from the Ron Paul Institute for Peace and Prosperity.