7. Capital, Interest and the Structure of Production - Listen -

7. Capital, Interest and the Structure of Production

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Time preference says that individuals prefer satisfaction now to later, present to future. This explains the loan market. In the structure of production, the capitalist pays wages now, despite the fact that he himself does not get paid until the final stage when the product actually comes to market.

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10. Banking and the Business Cycle

We have today a hybrid of two forms of banking – loan banking (non-inflationary) and deposit banking (inflationary if not 100% reserve holdings). The cause of booms is the credit expansion by central banks that is not backed by pools of private savings.

Published 06/16/07

9. Money and Prices

In the history of money, bartering was awkward because wants were not divisible. Direct exchange depended upon a double coincidence of wants. Demand for a medium of exchange grew until a general medium of exchange emerged, like gold and silver.

Published 06/15/07

8. Competition and Monopoly

Competition can mean rivalry or freedom. All firms must serve the preferences of consumers in order to exist. Monopoly has historically been an artificial privilege granted by the state.

Published 06/15/07