Alasdair Macleod: Gibson's paradox -- the consequences

11:51a Sunday, August 9, 2015

Dear Friend of GATA and Gold:

GoldMoney research director Alasdair Macleod has revisited the old correlation in economics between the general price level and interest rates, "Gibson's paradox," which economists long debated, or at least did before it seemed to break down in recent decades.

Macleod argues that the correlation would remain valid in free markets but has been nullified by the destruction by central banks of free markets for money, the seizure by central banks of control over interest rates, which are no longer set by savers and borrowers. This seizure, as might have been suggested to readers of these dispatches over the years, combined with surreptitious intervention by central banks in the gold market to suppress the price of the monetary metal, has distorted or destroyed all markets.

Macleod writes that central banks "have turned the principal objective of entrepreneurs from patient wealth creation through the accumulation of profits into ephemeral wealth creation through the accumulation of debt."

Macleod's study is headlined "Gibson's Paradox: The Consequences" and is posted at GoldMoney's Internet site here:

https://www.goldmoney.com/research/analysis/gibsons-paradox-the-conseque...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.