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Tue, 13 Oct 2009 08:52:34 -0400 |
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In his works that Fred Foldvary cites he does quite remarkably forecast the
crash of 2008. Two reservations, however:
1. The idea that cycles are exogenous has been mainstream canon since at
least Friedman and Schwartz wrote. (Let me coin a shorter word for
"government intervention": how about "cracygenic"?) Armed with this insight,
leading economists like Greenspan failed miserably, notoriously,
conspicuously to forecast or even prepare for the contingency of the Great
Crash of 2008.
2. It is hard to reconcile the cracygenic hypothesis with the remarkable
18-year periodicity of the real estate cycle, and the banking cycle that IT
generates. A new work on this is Anderson, Phillip, The Secret Life of Real
Estate. Another, that Wiley-Blackwell is releasing currently, is After the
Crash, by (blush) ... aw, shucks!
Mason Gaffney
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