Rowan Parchi has worked in financial markets since 2002 and is the founder of Praxis Path. Previously, Rowan worked in institutional equity sales at Credit Suisse in Sydney, New York, and Hong Kong, and at the hedge fund Platinum Asset Management in Sydney. His work has been featured on the Mises Wire.
The Misesian: How did you first discover Austrian economics?
Rowan Parchi: My journey was not via Ayn Rand. I was actually studying economics and finance in Australia. In one of the tutorials, there were two Danish girls who brought up this guy Hayek. The professor immediately jumped on them, squashed the discussion, and told everyone that he’s a nut bag, that he’s a right-wing lunatic, that his ideas have no credibility. He didn’t mention that he won the Nobel Prize at all.
I wasn’t particularly satisfied with my economics degree. It was basic Keynesianism, and it was fraught with contradictions, and it didn’t make sense to me. It wasn’t until after I left university, in the early 2000s, that I researched this forbidden person, Hayek.
I read The Road to Serfdom. From there I found Mises and Rothbard and the other Austrians, and I discovered the Mises Institute. The Institute was amazing because in this one place I was able to work through the whole corpus of Austrian economic literature, which, unlike Keynesianism, all made sense. It was cohesive. One part didn’t contradict the other part. It was extremely satisfying and has become a lifelong passion for me.
I’ve lived in various different parts of the world, and because everything on mises.org is free, I was able to continue my learning from everywhere I was. It’s been fantastic.
TM: You’ve worked in the financial services industry for a few decades now, in markets such as China. The financial world has obviously changed significantly over that time, particularly since 2008. What has been the value of Austrian theory in navigating this changing environment?
RP: What it gives you is a clear understanding of financial reality and financial markets specifically. It gives you a clear understanding that the efforts the state and its institutions make to stimulate and correct the economy result in problems down the track.
Now, the critical thing to work out is that in stimulated markets there can be a period of time where asset prices do well. But the long-term knowledge that stimulation will ultimately not result in wealth generation is really important. It means you can avoid being carried away by random policy proposals that don’t give benefits in the long run. This knowledge keeps you very aware of the risks.
Without the understanding that Austrian economics gives you, you can be fooled, and you can honestly believe that just by printing money and using it to buy government securities, you can generate wealth out of nowhere.
People with no knowledge of Austrian economics think that you can create wealth out of thin air. With Austrian economics, what’s happening is a redistribution of titles to assets, a revaluation of titles to assets, but you’re not creating real assets.
TM: After experiencing the Australian government’s response to covid, you left. Why?
RP: Australia was a wonderful place to grow up: a free society, a good culture, low crime rates, a feeling of safety and security. The state crackdown was just startling to me.
People did put up more resistance than the media talked about. But the media were complicit with the government in suppressing coverage of any resistance.
We felt helpless. There was a monolithic stamping out of all dissenting voices, which left my wife and me with no choice other than to leave. For business reasons and opportunities, we moved to Florida. It was a time when everyone seemed to be forgetting about freedom.
TM: Do you think the experience with covid is creating opportunities for more libertarian thought in Australia?
RP: Yes. But because of the media and political divisions, as well as the business and corporate classes, its not being encouraged. We don’t have a Nigel Farage movement in Australia yet.
TM: You attended the Supporters Summit this year. How was your experience in Delray Beach?
RP: Excellent. I was a little bit starstruck. All these amazing scholars that I’ve been reading for years were suddenly all in one place and very accessible.
Everyone was willing to discuss ideas, thoughts, opinions, and I basically just bounced around for the whole time, just having great conversation after great conversation. I really wish I had done it years ago.
