Booms and Busts

While economics textbooks are weak on causes of the Great Depression, American history texts are even worse. It's time for some truth telling.

By borrowing money and “creating” new jobs, the government is creating the illusion of a strong economy. This does not end well.

While the creator of modern portfolio theory was awarded a Nobel Prize, that doesn't mean the theory isn’t flawed. In fact, it explains very little about investments.

For a long time, banks have sought to keep construction loans “on the books” to collect more interest payments. With a recession looming, these long loans are likely to become delinquent.

When an economy suffers a recession, some factors of production, such as labor, become unemployed. Keynesians believe that expanding credit and fiat money will bring back full employment. That's not how an economy works.

While economics textbooks are weak on causes of the Great Depression, American history texts are even worse. It's time for some truth telling.

While the creator of modern portfolio theory was awarded a Nobel Prize, that doesn't mean the theory isn’t flawed. In fact, it explains very little about investments.

Bob comments on the key disputes from his recent debate with Dean Baker, underlying the differences between the Austrian and Keynesian frameworks.

Thanks to Federal Reserve intervention, apartments and apartment buildings have turned into giant malinvestments. Once again, a federal entity intervenes in markets presumably to make them work better, but things end in a crisis.

The Post-Keynesian School of Economics claims that business and personal debt create instability that sinks the U.S. economy. Private debt, however, is not the cause of boom-and-bust cycles.