Again, today, in spite of the Fed’s pumping of new money into the economy, banks have been slow to lend and consumers slow to spend. Prices have declined over the past 12 months – for the first time since 1955. You might say the economy is showing signs of improvement – the stock market is up 25 percent in the last two months. However, since government intervention caused the Great Depression, don’t be too hopeful that Washington’s current intervention will have any different outcome this time.
It is amazing that in both crises the same folks who caused the problem were called upon to solve it. The easy money policies of the Fed have been responsible for both the Great Depression and our current economic crisis. After the 1929 stock market crash, the Fed’s re-inflating policies did not allow the economy to rid itself of the malinvestments caused by its previous inflating. The economy sank into a deep depression. According to Rothbard, we are headed for a similar, if not worse, fate. If only Ben Bernanke had read Rothbard as a part of his study of the Great Depression.
Article comments
1 - Irene Wagner
Bush/Obama? Why the Slash, Kenn?
Few comments here, because you're making it sound too much like Bush and Obama might just have some blame to share.
Too bad so many financial bottom dwellers who are being worked over are throwing blame at one another, instead of focusing it where it belongs.
2 - Dave Nalle
Should they be blaming Murray Rothbard and the culture of selfishness and elitism which he advocated?
Dave
3 - Irene Wagner
It's not so much that they're blaming Murray Rothbard, Dave. They're ignoring him...or never getting around to reading him becase there's DEMOCRATS to be agin' or REPUBLICANS to be agin'.
(Kenn, I should be careful with sarcasm. I actually enjoy your articles and hated to see the 0 in the comments counter. So I had to open my big mouth.)