Most Americans have absolutely no idea of the causes of our ongoing financial crisis. Newscasters, most of whom are completely oblivious to any understanding of economics, spread the blame from greedy speculators to incompetent businessmen, missing the mark completely. Many economists simply point to the boom-bust business cycle but have no idea what causes the boom-bust cycle. Now, economists and laymen alike can grasp the reasons for boom-bust cycles, thanks to a New York Times bestseller Meltdown.
Buy a copy of Meltdown and go directly to chapter four: How government causes the boom-bust business cycle, where you learn that the blame for the boom-bust business cycle and today’s financial crisis lies with our central bank, the Federal Reserve System. Chapter four explains how the Fed’s screwing with interest rates distorts the business community’s perception of what’s really happening in the economy. As a result of these misconceptions, resources are allocated to the wrong places because Fed-induced, artificially low interest rates send the wrong signals.
The brilliance of Meltdown is that it is written so that readers need not be economists to grasp rudimentary understandings of the Austrian economic theory, and understandably so. The author, Thomas E. Woods Jr., is not only a senior fellow at the Ludwig von Mises Institute, which means he hangs with some smart people, but is the author of nine books, including The Church and the Market: A Catholic Defense of the Free Economy, which won in 2006 the prestigious Templeton Enterprise award. Woods has edited and written forewords for such esteemed writers as Murray N. Rothbard. The foreword for Meltdown was written by none other than world’s most popular U.S. Congressman, Ron Paul.