Government

A recent internal memo
obtained from the
Canadian Ministry of
Finance under the
Access to Information
Act revealed that the
Ministry may be about
to advise the Governor
of the Bank of Canada
against a further inter-
est rate hike.

The economy, claimed
one of the minister's
deputies, has ample room to
grow before intlition
Becomes a concern, the sub-
text, of course, being that a
hike would be “politically
unpopular.” The only news-
worthy item, of course, was
the surprise expressed by the
reporter that government
should consider interfering
with monetary policy.

Less in the realm of sub-
terfuge is the news that there
are two new candidates under
consideration for position of
head honcho at the Bank of
Canada. The ostensible lack
of public interest in the can-
didates prompted one finan-
cial op-ed commentator to
liken the toss-up to one
between two types Of tofit.
Mil add a qualification:
However you she it, and
whichever of pwo slivers of
slimy tofu your palate can tol-

conmacnt

crate, the mere endorsement
of a central bank must give
pause. Think of it: whether it
is raising or lowering interest
ates, this pecuniary plutocra-

ev is directing the lifeblood of

the economy. Has central
planning not proven deadly
to economies? Why then is
this any less true of the reign
over the money of Chairman
Greenspan oc his Canadian
counterparts who trail with

own raft of abuses, not

the manipulation of
growth rates and unemploy-
Ment rate:

With its origins in the
Bank of England of the
1690s, central, cartelized
banking is now common-
place. The blatant printing of
money, one object of which is
to finance gow rment

r, ba
ined into “tractional-
reserve banking.” FF.
reserve banking, explain
economists John P. Cochran,
Steven T. Call, and Fred R.

counterfei

Glahe, is aor creation
process, which involves the
banks in granting credit
through issuing “notes and
bank balances that are not

nomist Murray Rothbard

Hv iHustrates the process:
The Federal Reserve Bank
permits the commercial banks
te pyramid checkbook money
on top of their own reserves
by a multiple of approximate:
ly 6:1, so that if bank reserves
at the Fed increase by $1 bil-
lion, the banks can and do
pyramid their deposits by $6
billion.

Ifthe Fed wants to
expand the money supply, i
ho longer blatantly prints

it will simply inere

the reserves it gives to banks
sav by S1 billion, and leave it
up to the banks to max their
respective lending to the tune
of $6 billion of checkbook
money. Whether through
SErVing as a reserve for essen-
ially fraudulent banks, or

hasing, assets, usually
government securities, on the
tree market, the Fed is
involved in increasing the |
money supply. As cconor
Hans H. Hoppe, Jorg G
Hulsmann and Walter tlock
point out, this money substi-

a out of thin air,

represents No more than an
additional supply of property
tithes, while the supp

erminal need not expand

Dear Editor:

The time has come for some logical

remaining 75
oceurs onl

® of the year the problem

at the beginning of each holiday

thought regarding the proposed expansion of
the BC Ferry terminal in “shoe Bay,
Ignore the residents’ emotional attachment
to their village, the pollution, the irrevocable
destruction of scenic beauty, the loss of rev-
enue by focal merchants. Most people out-
side the confines of the western end of the
North Shore really don’t care anyway.
However, there is one thing any taxpa
should be alarmed about — we will be fund-
ing a $30-million plus car park which will be
vacant for at least 70% of the time.

While my math is ¢clementary and my
research limited to driving the Upper Levels
Highway at least twice daily for almost 30
years, [°m sure any unbiased study will back
up these figures.

Think about it: the overload problems
occur during the three months of June, July
and August — 25% of the year. During these
months the traffic is backed up mainly on
Fridays and Saturdays, and even on those
days not every sailing is backed up, let alone
every day of the three months. For 1

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So, averaging it out, the figure of 70% is cer-
tainly realistic.

There is po need for another terminal, ter-
minal expansion, or a bridge at the moment.
In the future probably, but right now the
salution is obvious —- a non-fee reservation
sery with a penalty fee for non-cancella-
tion, This could be e¢ implemented, at far
less than $30 million.

More term parking? Double deck the cur-
rent parking lot under the overpass, opposite
Gleneagles school and the golf course and
run a shutle. Unsightly yes, but a small sac-
rifice compared to the current plan, and a lot
cheaper.

People of B.C., I can think of many areas
in our system that would benefit from a $30
million infusion, and it is time the govern-
ment (and Crown corporations) reali
are here to serve us, the common people, and
they have wasted enough of our hard-earned
dollars.

D. Summers
Horseshoe Bay

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property remains constant.
The “money” very plainly
does not exist, making the
issuance of such paper notes
~—- called fiduciary media —
tantamount to fraud.

Amidst pronouncements
of plenty, crucial to under:
stand is that, unlike other
goods, the excess of which
henetit consumers, excess
Money originating in this
government -directed coun-
terteit creates intlation and
diminishes purchasing power.
Having cautioned that “paper
money cannot replace pro-
duction,” economist Frank
Shostak confirmed that the
‘ y rate of Fed-directed
growth of the money base

cen climbing consistent-
ly since 1996, this “large
increase in the money sup-
ply” being the essence of
inflation.

In an unhampered market,
the natural rate of intere
sould properly reflect the net
choices of all lenders and bor-
rowers tO Consume oF post-
pore consumption. The
espancica of credit by the
central and commerctal banks
distorts this rate, causing
interest rates to fall below the
natural rate, hence an artifi-
cial stimulation of economic

To Feduce fake

Something special
every Wednesday
in the News

t fuels infi

Friday, September 1, 2000 ~ North Shore News - 7

aii

anti-interest-hike, inflation -
tolerant advocate. As the
indefatigable scholar of
tral banking, Murray
Rothbard, observed, the first
to get the new money are the
counterfeiters themselves. By
the time it has percolated
down to the economically
marginal, monetary iaflation
has reduced its value. Some
coincidence it is then that
those who perch at the top of
the eartel’s pecking order,
like Alan Greenspan and the
Canadian fecund fellows, are
also “inflation doves.”
—qnome@atcanada net

directed investment has
already occurred.

Incidentally, the policies
the two Canadian candidates
are fissured along the same
fines that distinguish Alan
Greenspan trom his oppo-
nents. Greenspan, more of an
“inflation dove,” believes that
¥% unemplovment is compat-
ible with stable imflation,
“Hard-line™ Fed governor
Laurence Mever insist:
growth must further be
slowed to combat inflation at
the risk of a rise in unemploy-
ment.

My bet hedges on the

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