limtex,
Do you believe that one can form a viable opinion on a complicated issue without doing the required DD? I am referring to all things here, not just economics. Obviously, this is a rhetorical question. If you want to understand something, anything, then it requires that you go well beyond what is served up to you in the popular press or on message boards. This you seem disinclined to do. It requires that you read the detailed analysis, not just "twenty pages" as you suggest, but probably some thousands of pages.
People here are not sensitive. Understand what's up. You come here with views that we perceive as cookie-cutter because you are the Nth person in a long line of people to write more or less the same thing. We are not sensitive that you are disagreeing, but rather, we are weary of arguing the same old clown views.
The history of the world is, among other things, the history of human folly. This folly takes many forms, but a recurring one is the fallibility of human pride. From the Greek tragedies forward we see a common theme: hubris sows the seed of its downfall. Whenever we get the idea that we can control something, we are repeatedly taught the same lesson. (As an aside, the lesson never sticks, and that I find more interesting than any specific case.) To believe that Greenspan, or any human agency, can control the world economy is to let this most basic truth pass you by.
On the specific question of the world economy and its current travails, again, when we look through history we can see that economies have moved forward only through cycles of boom and bust, with many a lesser wiggle in between. We can ascribe virtue to boom and decry the evils of bust, but morality in this regard is a distraction. Depressions and deep recessions are rare, but necessary. Nobody would wish it to happen, but happen they always do. In every age we have tried to foresee and forestall them and we have never been successful. In fact, our efforts have at times simply made the inevitable down cycle worse.
If it were so easy to slow the growth of a bubble, believe me, they would have accomplished it. They wanted to very badly. The problem is, the mechanics of bubbles simply do not allow that. They grow ever larger until the inevitable climax, their final stage, the bursting. If we could see into the future, we would be able to control a bubble, but, well, forgoing that talent is the price of admission onto the mortal coil. Something bad (i.e., surprising) always comes along that forces us to inflate the bubble ever-larger.
Our age is no different. Many believe that because we have a deeper understanding of economics and better tools at our disposal, that we might eliminate terrible slowdowns altogether. You know, "This time is different." In this regard, we are arching for a thread that weaves through our history -- yup, hubris.
Nobody here knows the answer, but many here are more expert than most and the majority understand that they are students. The study requires effort. It routinely demands another "twenty pages".
Cheers. Allan.
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My issue is simply that Mr G with his reputation and experience ought to have been able to have predicted and prevented the unsustainable grwoth rate and predicted and prevented the current recession.
No complicated charts, no twenty pages of highly detailed analysis. |
