Power & Market

“Soft Landing” Headlines from 2007

As Bob Murphy and I discussed on the Human Action Podcast, economists and financial news media are already declaring macroeconomic victory by claiming that the Federal Reserve has achieved a “soft landing,” meaning that they have raised interest rates just enough to quell price inflation without causing a crisis or recession. Even Fed Chair Jerome Powell has backed off from his previous recession forecast.

To see whether such announcements from the Fed or financial news headlines could be trusted, I searched “soft landing” and constrained the dates to 2007. This is what I found:

Image
Soft landing headlines from 2007

These same headlines could appear today and nobody would notice. It shows a profession that is still obsessed with aggregates and “expert” opinion, unable to look under the hood or consider the unintended consequences of credit expansion, which are cumulative and inevitable. No amount of sophisticated “data-driven” tinkering with interest rates can forestall a recession indefinitely.

image/svg+xml
Image Source: Wikimedia Commons
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
What is the Mises Institute?

The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard. 

Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.

Become a Member
Mises Institute