Booms and Busts

People should live below their means during the recession.

Imagine, for just a moment, that US government debt were rated in the same way that municipal bonds or regular corporate debt are.

Because they can't find jobs, 85 percent of college grads move back in with their parents after they graduate.

Despite the billions and the debt, the depression was back. And it was not a new depression. It was the old one, which had not been driven away but merely hidden behind a curtain of 15 billion dollars of new government debt.

This article originally ran on Tuesday, February 17, 2009. It was near the low of the last stock-market cycle.

Recorded at Mises University 2011.

Recorded at Mises University 2011. Includes an introduction by Mark Thornton.

No, the bill can't be paid and won't be paid. That much should be obvious. But denying the obvious is a mental trait built into the structure of the system. The economic crisis of 2008 was really just the realization that the consumer-debt load at the time was unsustainable.

Here we see the huge gulf between Austrian and Keynesian analysis.

Ron Paul recently made (another) splash among economic pundits with his suggestion that the Treasury simply cancel the $1.6 trillion in its debt.