Wednesday update.

In Forbes, historian and Econoclasts author Brian Domitrovic explains that high taxes on dividends reduce corporate accountability.

At NRO, Larry Kudlow suggests the economy is improving.

On The Kudlow Report, President GW Bush discusses the dollar’s decline during his administration:




From October, Doug Casey neatly summarizes the case against currency devaluation.

1. A strong currency only hurts exports over the short run. Nobody seems to remember that the German mark was at .25, and the Japanese yen at 300 before the Nixon devaluation of 1971. The mark afterwards quintupled, and the yen has almost quadrupled since then.
2. A strong currency reduces the cost of imports, helping to keep prices in check. If the price of your currency doubles, the price of imported oil, machinery, technology, and everything else is cut in half.
3. Strong currencies attract foreign capital and encourage domestic savings. Businesses prefer to invest in a place where values tend to rise with the currency.
4. A strong currency encourages producers to be as efficient as possible. When domestic costs rise with the currency, producers run a tighter ship and substitute technology for labor. That is the path to progress. Using cheap workers instead of technology is a poor alternative.
5. Conversely, devaluing the currency simply makes everyone poorer. Most people keep their savings in the national currency, so are directly impoverished by devaluation. The only people helped (and only over the short term) are the relatively few companies that export.

At Forbes, Charles Kadlec blames rising oil on the falling dollar.

From CATO, three scholars ask, Has the Fed been a failure?

The Fed has failed conspicuously in one respect: far from achieving long-run price stability, it has allowed the purchasing power of the U.S. dollar, which was hardly different on the eve of the Fed‘s creation from what it had been at the time of the dollar‘s establishment as the official U.S. monetary unit, to fall dramatically. A consumer basket selling for $100 in 1790 cost only slightly more, at $108, than its(admittedly very rough) equivalent in 1913. But thereafter the price soared, reaching $2422 in 2008 (Officer and Williamson 2009)…. [M]ost of the decline in the dollar‘s purchasing power has taken place since 1970, when the gold standard no longer placed any limits on the Fed‘s powers ofmonetary control.

On C-SPAN, David Malpass argues QE2 is unlikely to help. At Forbes, more Malpass: