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I remember a seminar hosted by The Economist a little while
Posted on: February 21, 2020 at 22:05:48 CT
JeffB MU
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after the bubble popped in 2008. The moderator noted that the Austrian economists had been jumping up and down warning about the bubble a few years before it popped. She asked the economists around the round table how far ahead such warnings might be before they begin to lose credibility.
I also remember getting ads for investment letters from Austrian economists that detailed the facts in the housing bubble and the massive danger they posed for the economy. They showed the default rates, the amount of money involved and how much of it was masked by the structuring of the investments, among a number of other data sets.
What they were saying made sense to me, but as time went on their predictions seemed less worrisome. Month after month they were detailing these problems yet month after month the economy seemed to be doing better and better and the stock market just kept on rising and rising... and yet inflation was tame. In fact, the mantra was that we were in a Goldilocks economy. It wasn't too hot, nor too cold, just right year after year. Many were saying that the business cycle had been tamed, that there would be no more booms nor busts, recessions were a thing of the past.
And then, seemingly out of nowhere... BOOM!
I also remember getting ads for investment letters from Austrian economists that detailed the facts in the housing bubble and the massive danger they posed for the economy. They showed the default rates, the amount of money involved and how much of it was masked by the structuring of the investments, among a number of other data sets.
What they were saying made sense to me, but as time went on their predictions seemed less worrisome. Month after month they were detailing these problems yet month after month the economy seemed to be doing better and better and the stock market just kept on rising and rising... and yet inflation was tame. In fact, the mantra was that we were in a Goldilocks economy. It wasn't too hot, nor too cold, just right year after year. Many were saying that the business cycle had been tamed, that there would be no more booms nor busts, recessions were a thing of the past.
And then, seemingly out of nowhere... BOOM!
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I remember a seminar hosted by The Economist a little while - JeffB MU - 2/21 22:05:48