my idea for some time has been, the freedom movement radically defined. for social libertarians, economic libertarians, maximum freedom. minimal government interferences possible. we do have some anarchists here. it's been growing. my idea was most of them are herds of cattle. they do their blogging and website in all of this, but they seldom get together to conspire. so my idea is to create freedom sites to physically get together. we don't do any live streaming. you can buy the tapes afterwards, but we want people to physically come here. we've got 2200 people here in planet hollywood and we are growing. >> host: organized libertarianism. >> guest: it is working.

>> host: mark skousen, what is your background? >> guest: i am an economist from a group in portland oregon, which was an intellectual town. it has the world's largest bookstore. i've always been an intellectual type, but i also like music and dance and entertainment and sports. similar bit of a renaissance man. worked for the cia. can't talk about that -- and then i got into the financial world and that internet ever since. i have a phd in economics. my family lived in washington d.c., where c-span is. we call it death star. we got tired of the rat race, so we moved the bahamas and lived there for two years. it was life in living color. we saved enough money in taxes

and bought a flat in london. then we moved back to orlando, where kids grew up in either the new york, the financial center of the world. meanwhile, i've been writing writing and investment newsletters sent 1980. i've written about 25 bucks. i taught at columbia university and right now i'm teaching at sing sing penitentiary, which is an incredible experience. i have a pretty varied life. married, five children. my wife, joanne, runs the film festival here. so we live a really fun live and it's constantly changing. >> host: we are booktv, so we will talk about your newest book, "a viennese waltz down wall street." first of all, teaching at sing sing, what is that? >> guest: it is part of mercy college. it is privately funded education for four year college degree

program for these hard-core inmates who are in there for murder or worse and they can get a college degree so that when they do get out, they will have some kind of scale. you know, the biggest problem is recidivism. they don't have a skill contest at they end up going back to what they know, which is drug dealing or theft or what have you and the end up -- 60% end up back in prison. with this program, it is so successful that recidivism is zero. there's had to anyone who's gone back after graduating because they'll get decent jobs. i teach economics and finance. my wife teaches english literature. my son has a film out at hbo made -- is coming out with next year college sing sing university. so you will be able to see on

hbo that whole story. >> host: mark skousen, your most recent book, "a viennese waltz down wall street." what is austrian economics? >> guest: austrian economics is a free-market school of economics that is different then the chicago school, a little bit different than the keynesian school, the marxist school. his other schools in economics. the vietnamese one comes from the university of vienna. the original founder was carl manger, a journalist who covered the stock market. this is why i've got this connection with austrian economics. basically, austrian economics is in the adam smith kind of school of economics, a way to improve the adam smith model of the system of natural liberty, a firm belief in limited government, balanced budgets, the school is very proceedings,

very much in favor of sound money, the gold standard or something where inflation is controlled, pretty critical of the federal reserve and easy money policies. deficit spending. all the things we're doing today would virtually be opposed by the austrian school. >> host: you talk about the gold standard here. what happened in 1971? >> guest: so many dollars have been printed out that she could no longer maintain or d. $5 an ounce government guarantee program for gold. you couldn't fix the price of gold anymore because what was happening was the french and everyone else is going to the u.s. government, saying we would give you $35. we want the gold because another gold is gold is worth more than $5. nixon closed the window in 1971. the solution was controlled

inflation. start printing up so many dollars. but instead, nixon decided to say, we will eliminate the gold window. we don't want to lose any more gold to the french. so the price of gold took off. today it is over $1200 an ounce. so that is a reflection of the inflationary nature of the federal reserve. the austrian school would argue, here we talk about economists like ludwig rbc's, friedrich hayek that won a nobel prize in economics. and today's austrians would argue that the federal reserve is really an engine of inflation and is not really control inflation. it actually encourages inflation. that's a very different view from the federal reserve itself as one of our goals is to keep inflation down.

if you look at its been 100 years since the federal reserve has been established. prior to that. in the united states, inflation was virtually nonexistent except for brief periods of time during war, civil war, what have you. the inflation was virtually nonexistent for the first 100 years. since 1913, inflation has gone up thirtyfold, 3000%. this is not my study. this is a harvard economist who reported at the meeting finish of this incredible chart. i may have it on wall street but there's no inflation at all in such diet takes off, suggesting the federal reserve is an engine of inflation and not really a defender of the dollar like it should be. >> host: mark skousen, who are contemporary austrian economist?

>> guest: peeped devotee is a premier economist at george mason university. but it is not roger garrison of auburn university. there are a number of other economists going to church pace university or hillsboro college. there's a number of schools. nyu has a few economists. i would consider myself one of the premier supporters of the austrian school. i have applied it here in this case to the investment world. so i call it a viennese waltz down wall street. the reason i called it that was not too connected to the austrian school, but also because the traditional view is that stop prices are ever in them walk down wall street. i took my title from the famous book, a random walk down wall

street. i reject that notion completely. i would argue that wall street is more like a dance. human action. they don't make random decisions. they make deliberate decisions based on why are they buying? why are they selling? why are you here today? why are you interviewing me? you have a purpose in coming here. so stock prices are the same way. why they may appear to be random, we can be fooled by randomness. so stock prices are not random. they are purposeful. the problem is a lot of uncertainty because we don't know of is that motivates a person to buy and sell. >> host: mark skousen, does the government do anything in your view is this market to make markets better?

>> guest: absolutely. i eliminate government type of person that believes the rule of law is established. most of the time i believe in, not our natural love, where kind of develops on its own. this is the discovery process that involves the new york stock exchange, developing their own rules. and those rules are set in place. i do think however that the government often interferes and artificially creates administrative roles that are counter and i would use sarbanes-oxley as an example of a very bad some legislation that is really hurt ipos. dodd-frank is another one where it imposes all kinds of regulations on wall street and banks. we as austrians would be very much opposed to this. we would rather see maximum freedom in the financial markets. still, you go after the front others and so on. we believe in those rules.

but the problem with the sec, securities and exchange commission and other government agencies is that they often fail to catch the thieves until after they are exposed. bernie middaugh is a perfect example. the sec was approached several times by harry markowitz, who exposed the sec and the sec would even listen. i mean, this is typical. what did congress to? pay double or triple saying you mistake here when they said it's because we didn't have enough money. it is a fundamentally flawed system because it creates an artificial sense of security and investors say well, this guy -- bernie middaugh must be legitimate. the sec wouldn't allow somebody like that to be going on for dozens of years. i'm going to put some money with

them. but if we didn't have the sec, everyone would be much worse tactical and they would really check-in and investigate. it's kind of like tanks. when you have a $100,000 insurance on cds, do you really check status of the bank? is the bank making money? you don't care. your insured up to 100,000. that is bad economics, bad finance. you want this and sent aides say you are investigating and making sure that the buyer beware. there's too little of that in today's world. >> host: it is written for the average investor who would like to have a systematic approach to investing, who believes -- one of the focus is we have on our book is entrepreneurship, that people love stories. yes, you can buy the index.

that is bert mackie s. approach in a random walk down wall street. jack vocals approach with the vanguard. you invest in an index fund. but you know what, most people like to dance. most people like the action. i am not suggesting it is a gamble per se. there is a difference between investment and speculation. but i would also say that people love stories. this is what bert mackie of don't get is that you want to hear a great story about an individual stock that's increasing its dividends or cutting its dividends are earning more money or ensure just a new product or there may be a grammar about a buyout or something like that. i've been writing my own newsletter since ronald reagan was elected.

i consider myself a survivor. i started off by recommending index funds. my newsletter is it didn't excite people. but then i started telling about individual stocks, like ibm or dell computer, microsoft or apple. people get excited. these are real people. it is not a random story. it's not like a drunken sailor walking down broadway. it's bulls and bears, buyers and sellers. speculators and investors. there is an excitement on wall street. so my book is written for the intelligent investor who is interested in applying a new school of economics. not that familiar, the austrian school and seeing if they can make them a little bit better

investor. >> host: mark skousen, it is worked on the back by laurence hayek. escobar and kayak, who is in an e. was the son of friedrich hayek, the nobel prize-winning economist. i just found that quote. they put it on amazon after reading one of my books and studies the only guy i can understand. he speaks to the common man. laurence hayek was not an economist. he was an nda, so he wasn't trained as an economist. so i do try, since i live in the real world, i'm not just an academic. i have a phd in economics. because i am a practical investment advisor who's written a newsletter for 34 years, people are interested. i have a writing style that is more