It is part of the continuing myopic harping on aggregate demand which ignores all of the relative price adjustments that a post-bubble economy must experience. The Keynesian habit of ignoring the causes of depressions and dealing only with the analytically-secondary phenomena of aggregate expenditure is or should be unacceptable among intelligent economists.
I repeat what I said in 2008: Let the housing market collapse — fast.
via thinkmarkets.wordpress.com
An excellent post by Mario Rizzo. One of the frustrating emerging trends is the following:
2006: Ignore Austrian warnings about credit bubbles that will invevitably lead to a recession
2008: Realise there is a credit bubble, but ignore Austrian advice on allowing relative price adjustments to prevent the recession invevitably turning into something more serious
2010: Realise these is a secondary depression, and blame Austrians for not being able to get us out of it
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