In the history of money, bartering was awkward because wants were not divisible. Direct exchange depended upon a double coincidence of wants. Demand for a medium of exchange grew until a general medium of exchange emerged, like gold and silver.
Time preference says that individuals prefer satisfaction now to later, present to future. This explains the loan market. In the structure of production, the capitalist pays wages now, despite the fact that he himself does not get paid until the final stage when the product actually comes to market.
As with all government intervention, price controls do not achieve what their originators think they will. Trying to maintain a supply of milk by putting a price control on it will cause shortages, which are the very situations the price manipulators said they wanted to avoid.
The causal-realist approach began with Menger who based all of his observations upon reality that was intimately tied to the price system. Humans ceaselessly seek to remove unease. They consciously use means to attain their ends. Scarcity implies desirability and limitation.
Clark's enduring contribution to Mises's intellectual development and to Austrian economics was in being the first to perceive and explicitly argue that the starting point of theorizing about causal economic laws was the imagining of what he called a "static state," that is, a changeless economy in...
Loan banking is non-inflationary. Interest rates on loans are merely reflective of price spreads. All speculation, on the free-market, is self-correcting and speeds adjustment, rather than cause economic trouble.