Ep. 252 Bob’s Reaction to the Bernanke/Diamond-Dybvig Nobel Award
Bob Murphy Show
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How Does the Decentralized Market Economy Work?
Mises: Interest rates help coordinate production plans over time with consumers. He says if people want to defer consumption today in order to consume down the road, what do they do? They save more out of current income. And then all if you go into positive with the bank, that pushes down interest rates,. That gives a signal to entrepreneurs that now it's more affordable to invest in long-term projects because the interest rates lower.
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