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Leading authority on Gold, Austrian School of Economics, real bills, financial matters
Antal E. Fekete, Professor, Memorial University of Newfoundland, was born in Budapest, Hungary, in 1932. He graduated from the Loránd Eötvös University of Budapest in mathematics in 1955. He left Hungary in the wake of the 1956 anti-Communist uprising that was brutally put down by the occupying Soviet troops.

He immigrated to Canada in the following year and was appointed Assistant Professor at the Memorial University of Newfoundland in 1958. In 1993, after 35 years' of service he retired with the rank of Full Professor.

During this period he also had tours of duty as visiting professor at Columbia University in the City of New York (1961), Trinity College, Dublin, Ireland (1964), Acadia University, Wolfville, Nova Scotia (1970), Princeton University, Princeton, New Jersey (1974). Since 2005 he has been Professor at Large of Intermountain Institute for Science and Applied Mathematics (IISAM), Missoula, Montana. 

A view of Professor Fekete by Hugo Salinas Price
President, Mexican Civic Association Pro Silver, A.C.
Mexico City, Mexico

I first met Antal Fekete at a meeting of the "Committee for Monetary Research and Education", CMRE, whose general secretary then was, and still is, the indefatigable Elizabeth E. Currier, well-known and loved by all who are interested in monetary and financial affairs.

The week-end meeting of CMRE in 1976 was at Arden House, the huge mansion built by Wall Street magnate and politician Averell A. Harriman, overlooking the Hudson river.

Antal was then tall, dark and handsome and I was immediately captivated, not only by his remarkably clear understanding of the problems of money and finance, but by his perception of important flaws in the economic thinking of Ludwig von Mises. This was something surprising to me; up to that time, I had never heard a valid criticism of von Mises's work. My position was: "until such time as I hear a valid criticism of von Mises's work, I regard his work as the last word in economics."

Much to my surprise, Antal dissected von Mises's theory of interest - commonly understood as the difference in value between an apple today and an apple one year from now - and demonstrated the logical error implied in the comparison. I think that he has elaborated a theory of interest that is superior in logical structure to that of von Mises - a very important achievement, indeed.

Antal's thinking is dynamic, through his focus on arbitrage - each of us does arbitrage every time we perform an economic action; it is an omnipresent phenomenon. His other seminal focus is on the marginal actor in the determination of asked and bid prices, the discount rate, the floor and ceiling to interest rates, doing this arbitrage.

Antal has also pointed out that bond speculation was non-existent when all bonds were payable in gold. Bond speculation has been the source of enormous concentration of power in the hands of speculators, and he has identified the mechanism which has made that possible. A lot of newsprint bears witness to the damage that speculation in bonds is causing. Fekete tell us that "a man-made risk is not a valid matter for speculation; only speculation on risks caused by Nature is valid."

Antal opened my eyes to the truth about the much-disparaged Real Bills Doctrine of Adam Smith, which even von Mises rejected. This has further discomfited those who insist on idolizing von Mises. I knew von Mises personally and I have no doubt that he would have generously welcomed the refreshing ideas of Antal E. Fekete, a Hungarian by birth. Von Mises, a Viennese Austrian, was not a vain man; he was a kind man who would never have disparaged or rejected a thinker who was at least his equal.

Another point on which Antal differs from von Mises, is in the latter's consideration of a redeemable bank note as a present good. Antal is surely correct in considering that only the gold coin, for which the bank note can be exchanged, is a present good. "Indubitably!", I say.

His first essay published as a Monograph in the CMRE series, "Borrowing Short and Lending Long" was a masterpiece. It gave me my first impulse and inspiration to think of silver as the best possible money for popular use by the Mexican nation. Reading over this essay today, it is the best primer for understanding the financial fragility now reigning in the world, a condition that has yet to run its inevitable course.

When we met, Antal E. Fekete was hardly known. Today, he is read around the world, as he fully deserves to be. I am proud to call this man my friend. His thinking is as fresh and profound as ever; his erudition is classic, hard to be found in economic circles today.

Hugo Salinas Price
October 4, 2007

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