Laissez-faire RIP Obituary – Cause of Death : Western governments struggle with rising costs, obligations, and defense against global powers.

It is with heavy hearts that we report the passing of Laissez-faire, the long-standing economic principle that championed free markets and minimal government intervention. The news of Capital controls and financial repression are bedfellows. Western govs face rising interest costs, embedded generational obligations, defense burdens, green goals, and industrial stagnation vs. commodity and industrial adversary powers. Laissez-faire died… with no obituary. has left many in the financial world reeling, as its demise marks a significant shift in economic policy and ideology.

For years, Laissez-faire held sway over economic decision-making, promoting the idea that markets should be left to operate without interference from the government. However, as Western governments grapple with mounting challenges such as rising interest costs, generational obligations, and competition from global powers, the old laissez-faire approach has come under increasing strain.

The rise of capital controls and financial repression as bedfellows reflects a new era of economic thinking, one that prioritizes stability and control over unfettered market forces. With Western governments facing pressure to address issues such as defense spending, environmental goals, and industrial competitiveness, the days of laissez-faire seem to be numbered.

While the exact cause of death for laissez-faire remains unknown, its legacy will undoubtedly be felt for years to come. As we mourn the passing of this once-dominant economic philosophy, we must now look towards the future and navigate the changing landscape of economic policy with vigilance and adaptability. Goodbye, laissez-faire – you will be missed.

Capital controls and financial repression are bedfellows in today’s economic landscape. As Western governments grapple with rising interest costs, embedded generational obligations, defense burdens, green goals, and industrial stagnation in the face of competition from commodity and industrial adversary powers, it is clear that the laissez-faire approach to economics has died a quiet death, with no obituary to mark its passing.

### What are capital controls and financial repression?

Capital controls refer to measures taken by a government or central bank to regulate the flow of capital in and out of a country. These controls can include restrictions on the amount of money that can be moved across borders, limits on foreign investment, and regulations on currency exchange. Financial repression, on the other hand, involves policies that artificially lower interest rates, creating a negative real return on investments. This can include measures such as capping interest rates on savings accounts or government bonds.

### How are capital controls and financial repression connected?

Capital controls and financial repression often go hand in hand as tools used by governments to manage economic challenges. In times of economic uncertainty or crisis, governments may implement capital controls to prevent capital flight and stabilize their currency. At the same time, they may also use financial repression to reduce the real value of their debt and lower borrowing costs. Together, these measures can help governments manage their fiscal and monetary policies in the face of external pressures.

### Why are Western governments facing these challenges?

Western governments are facing a perfect storm of economic challenges that have made capital controls and financial repression more attractive options. Rising interest costs are putting pressure on government budgets, while embedded generational obligations, such as pensions and healthcare costs, are straining resources. Defense burdens, green goals, and industrial stagnation further complicate the picture, as Western economies struggle to compete with emerging powers in both traditional and green industries.

### How has the death of laissez-faire impacted economic policy?

The death of laissez-faire economics has paved the way for a more interventionist approach to economic policy. In the past, governments might have been more hesitant to implement capital controls or financial repression, fearing the negative consequences for market efficiency. However, in today’s complex economic environment, these tools are seen as necessary evils to manage the competing demands on government resources and stabilize the economy.

### What are the implications of these policies for investors and savers?

For investors and savers, capital controls and financial repression can have a significant impact on their financial well-being. Capital controls can restrict the ability to move money in and out of a country, limiting investment opportunities and potentially reducing returns. Financial repression, meanwhile, can erode the real value of savings and investments, leading to lower overall wealth accumulation. In this environment, investors and savers must carefully consider the implications of government policies on their financial strategies.

In conclusion, the intertwined nature of capital controls and financial repression reflects the complex economic challenges facing Western governments today. As they navigate a shifting global landscape, policymakers must balance competing priorities to ensure economic stability and growth. While the death of laissez-faire may have marked a significant shift in economic thinking, it has also opened the door to new tools and strategies for managing the complexities of the modern economy.