China calls for global currency…

…but you’re only surprised by this if you haven’t been paying attention.

Of equal if not greater interest, the linked article makes mention of the high rate of personal savings that has ensued since the economy tanked.  This is considered by clowns and economists (but I repeat myself) to be a bad thing.  Experts tend to think that spending is better for the economy than saving, and while it is of course necessary for spending to happen in order that an economy can exist, a low rate of savings is nonetheless to be avoided.  However, this is not obvious in an economy that has come to depend on deficit spending.

Modern economists often say that credit is the key to success in the “free” market. An older school of economics, however, would say that capital is the basis of the free market.  An entrepreneur saves up capital, or finds investors, and starts a business.  It is not spending, as such, which gets this operation going, but rather accumulated savings.  Whether the savings is the entrepreneur’s or someone else’s matters not; the money has been piling up due to the intelligent action of far-sighted people.

These days even our banks are too short-sighted to save, and so the Federal Reserve just prints money for this and for that, even to rescue individual businesses who’ve mismanaged their assets.  This calamity results from thinking that credit is the yellow brick road to wealth and happiness.  Alas, it is rather a copper path to hell, paved with the cheap metals that the central bank uses to make our “money.”

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