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Profits of Chaos

Economics and Entrepreneurship from an Austrian Economics Viewpoint. To get free updates just type your email in the box.


taxman7A former student asked me to write up a piece on pro’s and con’s of different types of taxes. Of course all taxation is armed robbery. But whether you’re running a protection racket or voting in a democracy, it’s worth getting into why particular types of taxes are chosen, and whether one type is “less bad” than others.

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The world economy is being slowly strangled. Can it be reversed?

We can start in Asia. The mainstream narrative is that China will take over the world while Japan watches from its deathbed. Last week I argued that Japan’s decline is greatly exaggerated, a myth that covers the big swindle. This week it’s China’s turn under the microscope. More accurately, it’s democracy’s turn under the microscope.

What makes China unique among major economies is neither its fast growth nor its size. It’s the simple fact that [click to continue…]


Shinzo on the MikeOne of the great economic myths of our time is Japan’s “lost decades.” As Japan doubles-down on inflationary stimulus, it’s worth reviewing the facts.

The truth is that the Japanese and US economies have performed in lock-step since 2000, and their  performance has matched each other going as far back as 1980 (!)

Either Japan’s not in crisis, or the US has been in crisis for a good 35 years. You can’t have it both ways.

Here’s a chart of [click to continue…]



At what point do the people rise up? Today I’ll look at taxes.

History is full of tax revolts. It’s a fairly popular pastime, if historians are to be believed. But when do they come? What’s the spark and what’s the gasoline?

Today we’ll look at one data point from Sun-Tzu’s Art of War.

Sun-Tzu argues that [click to continue…]




Throughout history armies have used counterfeit currency as a weapon of war. Interestingly enough, the method used is nearly precisely what central banks do today to their own economies. The history of monetary stimulus as weapon of war informs one of the most most important aspects of the business cycle: does an increase in money help the economy? Or, does “stimulus” actually harm the economy by perverting the price system that guides entrepreneurs and investors.

The protagonists in this debate are the Keynesians who, true to form, [click to continue…]