Liberty MavenFinancial Crisis and Recession
October 6th, 2008 1:18 pm | by Mike Miller | Published in Bailouts, Banking, Big Government, Debt, Economics, Federal Reserve, Free Market, Money, Politics, Taxes, government spending, ludwig von mises, national debt | Comment
Today’s article at the Ludwig von Mises Institute discusses the financial crisis that they and other Austrian economist have been predicting all along, and the long, long road ahead of us.
The severe financial crisis and resulting worldwide economic recession we have been forecasting for years are finally unleashing their fury. In fact, the reckless policy of artificial credit expansion that central banks (led by the American Federal Reserve) have permitted and orchestrated over the last fifteen years could not have ended in any other way.
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…the dilemma facing Ben Bernanke and his Federal Reserve Board, as well as the other central banks (beginning with the European Central Bank), is not at all comfortable. For years they have shirked their fiduciary responsibility, and now they find themselves in a blind alley. They can either allow the recessionary process to begin now, and with it the healthy and painful readjustment, or they can procrastinate with a “hair of the dog” cure. With the latter, the chances of even more severe stagflation in the not-too-distant future increase exponentially.
