RealEconTV

Business news without the bullshit

The Austrian School looks at Boom and Bust

More from Frederick Hayek

Subscribe to RealEconTV

Your e-mail address is kept absolutely private
We make it easy to unsubscribe at any time

Central banks, yes? Interest rate distortions, no

Real prices are the most important thing for guiding an economy and making it maximally productive and sustainable.

Distorting prices - and that includes distorting interest rates - creates confusion in the system.

There's inherently nothing wrong with allocating social resources, but bailing out business losers - in this case large banks and their bondholders that have behaved recklessly - is the worse mistake of all.