the conclusion does not follow from the list of events. After all, it seems that the U.S. financial crises are getting worse. Those outside the U.S. seem to be bouncing back more on the U.S. -- and seem to be getting larger, too.
Bubbles are intrinsic to capitalism (cf. tulipomania), but they can get worse. One thing that let the US 2000s housing bubble get so large was Greenspan's low interest rates (put in place to deal with the collapse of the last bubble). Greenspan provided the gas, pumping up the bubble. Financial deregulation -- which started under Reagan -- removed limits on how big the bubble could grow, how much over-leveraging could occur, and thus how large the negative impact on GDP and the like would be. Of course, with continuing stagnation of mass consumption not based on credit, the US economy would likely not have had much recovery or demand-side growth at all. It needed the bubbles. Miracle Max Sawicky wrote: > http://crookedtimber.org/2010/03/23/crisis-is-the-normal-state/ > > Lapse of regulation under Clinton and/or Bush does not necessarily explain the > latest financial crisis. Thx to our friend Daniel Davies: > > 2007 – current crisis > 2002 – Enron/Worldcom/Global Crossing crises > 2000 – dot com bust > 1998 – Asia/Russia/LTCM crisis > 1994 – Tequila crisis > 1991 – commercial real estate crisis > 1987 – Black Wednesday > 1985 – Savings & Loans crisis > 1982 – LDC debt crisis > 1975 – New York City bankruptcy > 1971 – Collapse of Bretton Woods > 1970 – Penn Central commercial paper crisis > > I'd say the Reinhart/Rogoff book is in the same spirit: > bubbles are intrinsic to capitalism. -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
