Saturday, August 8, 2009

Surprise! The Capital Is Gone!

When the Keynesian ego-driven interventionists bring about the unspeakable stagflation (again, but this one will be the big one!) and have no choice but to stop creating money out of thin air (stop causing inflation) then prices will stop rising.

"Good!' you say.

But the entrenched costs created by unions and regulations will then cripple industries and all of the sudden it will be discovered that almost all of the capital has been consumed. Hence begins the long process of recovery, a recovery starved of capital and burdened by ego-driven interventionism.

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