About Me
Let's Get Acquainted
The founder of Old Bluffer studied economics for years and has a Master's in that subject from George Mason University. He is inspired by heterodox economics such as the Austrian School, Post-Keynesian, and Virginia Political Economy/Public Choice. He believes that writing is thinking. This website will be an outlet for inquiry into political economy. Other "hot button" topics may be addressed occasionally.
The Forgotten Man is never a pauper. He almost always has a little capital because it belongs to the character of the man to save something.... If you do anything for the Forgotten Man, you must secure him his earnings and savings, that is, ... you must oppose paper money...
The 21st Century Forgotten Man
Around 2015, during one of the last times I saw my grandfather alive, he complained about how he was only earning negligible interest on his savings. He perhaps didn't know that real interest rates were negative at several points during his lifetime, but the extremely low nominal rates were unprecedented and conspicuous. An insider at the Fed recognized that monetary policy was the problem: "[The Fed] has succeeded in virtually outlawing saving. Most seniors pine for a return to the beginning of this century when they could get a five-year jumbo CD with a 5 percent APR, offset by inflation somewhere in the neighborhood of 2 percent" (Danielle DiMartino Booth, Fed Up, Portfolio-Penguin, 2017, 263). A former Washington D.C. insider recognized what our monetary policy was--an attack on frugal people: "The transfer of wealth continues ... in the form of relentlessly low interest rates, and an ongoing war by the Fed on safe and stable investment tools such as savings accounts and low risk bonds.... [The Fed's policy] actively works against middle-class people who want to work and save and invest their money responsibly and conservatively" ("David Stockman on his Book and the Bailouts," The Free Market, Vol. 31, No. 7, July 2013, 6). Today, the CDs earn 5 percent, but the inflation rate cancels that out. In 2010, I went to a conference in Nashville where one of the speakers talked about how we could "neutralize the Fed". Many savers today believe that they can neutralize the Fed by finding an inflation hedge. They've been told that "stocks are a hedge against inflation" (Ric Edelman, The Truth About Money, Georgetown UP, 1996, 115) and that "over time, the market has always gone up" (Tiffany Aliche, Get Good with Money, Rodale-Random House, 2021, 228). Stock averages, however, have fallen by a thousand points or more in inflation-adjusted terms since the bull market ended in 2021, and no one knows when the next advance will begin. We know what the problem is: monetary central planners who don't care about people like my grandfather. Neutralizing them won't be easy, but it's clear that if you are dealing with the commercial banks, you are ultimately dealing with the planners who have rigged the system against you. Multiple authors have suggested that we "become our own banker," but they don't agree on how we can do that. People understood that the status quo wasn't working for them, but a change didn't help savers much. Instead, the self-proclaimed "King of Debt" embraced negative interest rates (https://twitter.com/realDonaldTrump/status/1171735691769929728?s=20). With negative nominal rates, you'd be better off keeping your money in a safe. Then, you'd really "be your own banker". Read my blogs for ideas on what you can do to actually preserve your hard-earned wealth.
