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How an Economy Grows and Why It Crashes explained How an Economy Grows and Why It Crashes, review How an Economy Grows and Why It Crashes, trailer How an Economy Grows and Why It Crashes, box office How an Economy Grows and Why It Crashes, analysis How an Economy Grows and Why It Crashes, How an Economy Grows and Why It Crashes a2a2 How An Economy Grows And Why It Crashes Uses Illustration, Humor, And Accessible Storytelling To Explain Complex Topics Of Economic Growth And Monetary Systems In It, Economic Expert And Bestselling Author Of Crash Proof, Peter Schiff Teams Up With His Brother Andrew To Apply Their Signature Take No Prisoners Logic To Expose The Glaring Fallacies That Have Become So Ingrained In Our Country S Economic ConversationInspired By How An Economy Grows And Why It Doesn T A Previously Published Book By The Schiffs Father Irwin, A Widely Published Economist And Activist How An Economy Grows And Why It Crashes Incorporates The Spirit Of The Original While Tackling The Latest Economic IssuesWith Wit And Humor, The Schiffs Explain The Roots Of Economic Growth, The Uses Of Capital, The Destructive Nature Of Consumer Credit, The Source Of Inflation, The Importance Of Trade, Savings, And Risk, And Many Other Topical Principles Of EconomicsThe Tales Told Here May Appear Simple Of The Surface, But They Will Leave You With A Powerful Understanding Of How An Economy Grows And Why It Crashes

  • Hardcover
  • 233 pages
  • How an Economy Grows and Why It Crashes
  • Peter D. Schiff
  • English
  • 23 June 2019
  • 9780470526705

About the Author: Peter D. Schiff

Peter David Schiff is an American investment broker, author, financial commentator, and was a candidate in the 2010 Republican primary for the United States Senate seat from Connecticut.Schiff is CEO and chief global strategist of Euro Pacific Capital Inc., a broker dealer based in Westport, Connecticut and CEO of Euro Pacific Precious Metals, LLC, a gold and silver dealer based in New York City.

10 thoughts on “How an Economy Grows and Why It Crashes

  1. says:

    If you read this one book, and then formulate your opinions about the market with this material alone, you are a moron This book will forever stick in my memory as a yardstick to determine intelligence by I told my wife that it isn t bad, per se It s just stupid, wrong, and written for a 5th grader Admittedly, it simplifies a huge problem in a concise manner but that s the problem It is such an oversimplification that it allows the author to subtly interject erroneous beliefs into the narrative The technique is simple, dumb the subject matter down enough for the American masses, and then interject populist notions with thinly veiled race baiting in order to convert a preconditioned audience There is a kernel of truth to the overlaying theme, which makes it easy to slip not only incorrect notions into the work, but dangerous ones as well I read this book in less then 1 hours, and found myself often reading a page with the knowledge that I had already 400 500 page works devoted to the subject at hand I would recommend this work be used in a High School introduction to economics, but the sad reality is that many adults are going to base their world view on a piece of trash like this Peter Schiff was smart enough to predict the markets, and I ve always admired him for sounding the warning bells this work sadly makes me think a world less of him.

  2. says:

    Peter Schiff exposes the flaw in Keynesian economics through the use of an extended allegory or parable His story involves an island nation that grows from subsistence living to great prosperity and then declines The island nation represents the United States The story serves as a warning against Keynesianism.In the beginning, there are only three men Each man catches and eats one fish per day Then, one man decides to forgo his meal for the day to build a net, which proves successful and subsequently enables him to catch two fish in less time This man uses the additional resources free time and extra fish provided by the net to lend, trade, and relax Thus, the expansion of the economy begins Other people on the island take similar risks.Schiff uses this simple storytelling device to introduce the reader to economic topics such as risk, capital, interest, money, inflation, bubbles, and busts Peter Schiff is a free market libertarian who sees the government as the source of misallocation of scarce resources His story traces the rise of the United States as an economic powerhouse from its inception through the first part of the 20th century Then his story tracks its decline into economic stagnation following the ascendancy of Keynesianism, the income tax, and the Fed.Schiff shows why what we intuitively know to be true actually is true These truths, so often ignored or obscured by fancy jargon or education, include 1 Paper dollars have no intrinsic value.2 Printing paper dollars will decrease the value of all other paper dollars.3 An economy is strong and grows because people produce goods and services.4 Consumption does not create a strong economy by itself.5 An individual or nation cannot become wealthy simply by consuming.6 The massive debt and deficits of the United States cannot be sustained.7 To deal with the massive debt and deficits, the United States can a inflate, b raise taxes and lower services, or c default.8 Deflation, which is simply gently falling prices, is the natural result of a healthy economy free of government interference.9 Deflation arises because of increasing efficiencies of production.10 Deflation is a good thing for all consumers.11 Inflation is the result of politicians making promises that can t be fulfilled.12 Politicians monetize the debt, which simply means inflate the currency to technically fulfill their promises.13 Inflation harms savers and helps debtors.14 Saving is the necessary prerequisite for capital accumulation.15 Capital can be thought of as something to help us make something else that we want E.g., a shovel, a tractor, a factory, or any other tools.16 Capital accumulation is the necessary prerequisite for an expanding, healthy economy.So if Keynesianism is bunk, why is it so widely accepted amongst politicians and economists in academia Schiff says that Keynesianism gives the appearance of a free lunch It promises an unending economic boom based on spending By encouraging politicians to spend, they can buy votes politicians love to spend How did the idea infest the academies Those universities with people in high political offices get better grants and prestige Any economist who would tell a politician the truth that their officious meddling is causing harm than good, that spending in one area creates asset bubbles and misallocations of resources, that saving a high paying job in industry A comes at the expense of all the other industries because customers have less money to spend elsewhere would not have that politicians ear for very long.Moreover, it is politically appealing for a politician to promise the world a guaranteed job, a chicken in every pot, security in one s old age even if you haven t saved anything yourself, a Great Society with free housing and food stamps, free healthcare This is a much gripping and emotional tale than a stoic recitation of the importance of free markets and the gradual progress of innovation There are less concrete guarantees in a free market even though such a system is precisely what enables politicians to promise to spread the wealth around in the first place.In the end, economics is ultimately the dismal science There are no solutions, only tradeoffs Keynes tried to change all that with faulty promises that too many have bought into The United States, like France, the Confederacy, the Weimar Republic, Hungary, Argentina, Yugoslavia, Zimbabwe, and many others risks hyperinflation with its loose monetary policy and the lack of a currency backed by something tangible, such as gold Schiff says that borrowing from China has enabled the U.S to hold off tough decisions for a long time China gives us goods and we give them increasingly worthless paper dollars That situation can t last forever.With pictures and large type, the book is a very quick read The style is simple to the point of elementary For those with no background in economics at all, it could prove useful To my mind, supporters of Keynesianism can be exposed as charlatans by asking them one simple question So, if your theory is correct, what s wrong with counterfeiting

  3. says:

    This book is pure, unadulterated genius.It explains where we ve come from and where we re headed It explains how Keynesian ideas have prospered over Austrian economics, even though they are utterly, hopelessly wrong and are ruining our country I cannot recommend this highly enough to anyone who cares about America I read it in two days, easily, and so can you Who doesn t have two days to change their life Quotes We are told that we must go deeper into debt to fix out debt crisis, and that we must spend in order to prosper The disconnect results from the nearly universal acceptance of the theories of John Maynard Keynes, a very smart early twentieth century English academic who developed some very stupid ideas about what makes economies grow As a consequence of their pro government bias, Keynesians were much likely than Austrians to receive the highest government economic appointments Universities that produced finance ministers and Treasury secretaries obviously acquired prestige than universities that could not Inevitably economics departments began to favor professors who supported those ideas Austrians were increasingly relegated to the margins The truth is that the Fed now exists for the sole purpose of providing the inflation necessary to allow the government to spend than it collects in taxes.During the Depression, President Roosevelt decided to devalue the dollar against gold In order to pull this off, the government had to control the entire gold market, and for a time the government made it illegal to own gold coins Later on the ability to redeem the notes for gold was restricted to just banks, then to just foreign banks, and then finally to no one We are left with a currency that has no real value and can be expanded at will This has prevented the government from ever having to make hard choices about spending and taxes, and has set us on a path that will eventually destroy the remaining value of the dollar.Although economists talk like they have seen it all before, the truth is humanity simply has no long term precedent for universal economic activity based on irredeemable paper money now we are in a through the looking glass world where, for the past 40 years, no country issues real money This is the biggest monetary experiment even conducted No one knows how or when it will end But rest assured, it will.When the economy started to contract, lawmakers and economists treated the development not as the inevitable consequence of years of easy money and overspending, but as the problem itself In other words, they mistook the cure for the disease.An economy can t grow because people spend people spend because an economy grows.The creation of ever greater quantities of debt has given us a reprieve from the process of returning to living standards commensurate with our productivity But at some point in the foreseeable future, perhaps in the next few years, we will have a very ugly encounter with our debt France in the 1790s, the Confederate States of America in the 1860s, Germany in the 1920s, Hungary in the 1940s, Argentina and Brazil in the 1970s and 1980s, and Zimbabwe today In all of these instances the circumstances that led up to the hyperinflation, and the economic devastation that followed, were remarkably similar The countries satisfied staggering debt by wiping out the value of their currencies As a result, their own populations were thrown into abject poverty By refusing to allow market forces to rein in excess spending, liquidate bad investments, replenish depleted savings, fund capital investment, and help workers transition from the service sector to the manufacturing sector, the government has resisted the cure while exacerbating the disease.

  4. says:

    Fun, but flawed.As a basic primer on the evolution of economies, this book is a light and fluffy start for the layman Where it is flawed, however, is that it s written with a conclusion already in mind and the analogy on which it builds is therefore twisted to suit that view The trouble is that the gold standard, which this book extols, is not the same as an economy based on fish fish being a resource which can be replenished and grown A real economy, based on gold, can only be stifled by the limited supply and filled with inequalities by the uneven distribution Nonetheless, the book is enjoyable.

  5. says:

    Usually, I don t read books in a single stretch but this is one of those books that I couldn t get enough of.When it comes to the 2008 Financial Crisis, not many economists are able to explain it in layman s terms Peter Schiff does an extremely good job in dissecting the basic concepts of Economics from scratch This is an exceptionally well written book and specially curated for the layman The way Schiff relates to the concepts is laudable He starts off by using the fish analogy and bases all his explanation on that From the 2008 Financial Crisis to the flaws in the governmental policies, this book discusses a gamut of fallacies in the current Keynesian school of thought.There s a caveat though Schiff is a proponent of the Austrian school of economics and there are a few instances where he might have gone a step too far to prove his point I usually don t like when an author is hellbent on a particular view but somehow it works for Schiff throughout the book And especially when it comes to economics, a particular school of thought can be artfully used to manipulate the views of the reader So, keeping this in mind will help in a better understanding of the underlying motivation of the author.Written purely for the layman, this book when read with Ha Joon Chang s Economics The User s Guide gives a clear understanding of Economics and the different school of thoughts An exceptional book for sure, it is a must read.

  6. says:

    well, If you are destined to become a successful person, then facing your personal issues wouldn t be a problem for you People in general, have very little knowledge of how the economy affects our daily lives, regardless of our interests.Sometimes, the lower class citizens are entirely neglected by the government, which makes it even hard for people with their set of skills to find a job In the final analyses, Schiff is convinced that the countries should eradicate the concept of minimum wage.The minimum wage enforced laws target the poorest layers of our society by pricing them out of the job market

  7. says:

    This book reflects my views and style than anything I have read that s not my own Hence the rating could not have been any different Economic theories need to be de jargonized every now and then to understand the stupidity of some of the things that policymakers do or are recommended to do Extremely few people, with many experts excluded, tend to understand the basic meaning of some their pet economic solutions or policies Complex theories effectively lead to equivocation, obfuscation of who bears the real costs often future generations, or disconnected people of things that appear like free lunches or financial economic progress More often than not gains our of economic decisions come at extreme costs and only jargon less observance could lead to a discussion of true cost benefits.This is what the book tries to do for the way at least one type of economic cycle is generated in this book One may or may not agree with the theories or conclusion, but one is unlikely to walk away without new understandings.The book, in all its simplicity, is witty and hits home some basic truths not told in economic textbooks these days Its scope is broad and brush too narrow as a result its simplicity becomes a hindrance The conclusions are too sweeping and most tellingly ignore the time element This is a book for people who want to think about the implications of economic theories on real life, for decision makers in policy but not for most financial market investors.

  8. says:

    This is my review on dated October 22, 2013 The book walks you through the basics of island economics, in which FUNDAMENTAL ECONOMIC PRINCIPLES in a hypothetical three man initially economy are explained.It is basically an allegory of the US economic history riddled with lots of illustrations that add visual dimension to the humor in which the authors present the story No, a touch of humor does not at all downplay the seriousness of the subject matter, nor does it detract anything from the LOGIC and COMMON SENSE in the economic principles described.There are quite a few principles that I would have permanently engraved, if I could, on the minds of today s leaders and mainstream economists, but if I was to bring up just one for all, it would be that SAVING IS EXTREMELY IMPORTANT FOR ANY ECONOMY TO BE HEALTHY Unfortunately, we live in an inflationary period in which high time preference consumption is considered rational, while prudence saving is viewed silly We live in a world in which it is believed by those in power anyway that we can spend our way to prosperity The economy, HOWEVER, does not grow because the society consumes Vice versa, THE SOCIETY CONSUMES MORE BECAUSE THE ECONOMY GROWS as a result of increased productivity.

  9. says:

    Very entertaining and a remarkably easy read Schiff argues compellingly that the basic principles of an economy remain basically the same between large and small economies He allegorizes how an economy grows in the story of small fishing economy, providing many clear insights in economics along the way.

  10. says:

    This book must be read at an age when your mind is ready to differentiate between the prevalent economic ideologies and their merits demerits but certainly not before an age where you cannot locate the fallacies in the author s arguments Without any background in economics, I personally wish I could have read it before my post graduation in business management.

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