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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: ayn rand who wrote (89246)	7/30/2009 7:39:56 PM
From: Elroy Jetson	1 Recommendation Read Replies (1) \| Respond to of 94695

I have no idea what poor Tom Woods' problem is. Perhaps he is otherwise unemployable, apart from telling fairy-tales for a fee. The economic malaise following the end of WW-I was "solved" with a massive credit bubble, which caused the the Great Depression -- in much the same way that Reaganistas "solved" a period of slow growth in America with a massive credit bubble, which has in turn caused our current problems. This is both undeniable and well documented. Credit bubbles do not solve problems, they merely postpone and magnify them. As Schumpeter said, to prevent the crash you have to avoid the bubble which precedes it. Reaganistas and Fed apologists may babble on about "good debt" and how it makes the economy "more efficient". But the simple truth is that a rising debt to income ratio stunts economic growth and inevitably leads to a depression. The only way to continue the insanity since 1981 is to move to negative interest rates, an idea so insane only the Fed has considered it. I would have much preferred that the debt bubble never begun in 1981. But given that foolish people created it anyway, I would have preferred the economic depression of 1996, which was unfortunately "fixed" with an even larger Greenspanian credit bubble. And I would have preferred the even more devastating economic depression of 2001, which in turn was fixed with the largest real estate bubble known to man combined with reckless government spending. The depression of 2001 would have been less devastating than the one we face now. But that being the case, it's better to experience the full brunt of the economic depression today than create another postponement creating an even larger problem in the near future.