Are you back and blogging again after your second long absence?
I hope to be around until I head off again....
What's just as important to an economy is savers. Saving in itself is a type of spending.
Alice - very enigmatic as usual.Thought you might be interested in this. You've been right all along:http://www.moneyweek.com/investments/property/uk/britains-secret-house-price-crash-13701
Electro-Kevinactually, I don't think I saw it. I thought we were looking out a small correction in prices, a modest bump in GDP, and then everything would get back to normal.I don't think that's where we are.Alice
dcm101you are right, there are savers. They are being ripped off by negative real interest rates. I wonder what would have happened if they had been less panicked response to the initial crisis. Policymakers overreacted, screwed up relative prices, including interest rates, and the economy has not yet recovered.Alice
I wonder what would have happened if they had been less panicked response to the initial crisis. Policymakers overreacted, screwed up relative prices, including interest rates, and the economy has not yet recovered.The choice was:- be bankrupt early due to liquidity problems. i.e. enough assets (probably) but they can't be shuffled around fast enough.- be bankrupt later due to insolvency problems. i.e. insufficient assets.The latter option was chosen. It's only a different way to Hell - although the scenery is different, the destination is the same.What - in your eyes - would a "recovered" economy look like? And when was the last time we had an economy that looked like that?
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