On Wednesday, August 19, 2009 at 17:08:13 (-0700) David B. Shemano writes:
>Rudy Fichtenbaum writes:
>
>>> During the depression the unemployment rate peeked around 25% in 1933.
>>> It went down to 15% in 1937. From 1933 to 1936 real federal spending
>>> increased increased 100%. (I am looking at index numbers for the
>>> quantity of real GDP). Presumable the increase was associated with the
>>> New Deal spending and it seems to have worked.
>
>Why do you presume the correlation equals causation?

Basic economic theory says this should happen, and it does.  Why is
this so hard to understand?


Bill
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