On this page you can find posts that examine past economic crises for the lessons they might hold for us.

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2 thoughts on “Economic Crises

  1. Some economists argue that financial crises are caused by recessions instead of the other way around, and that even where a financial crisis is the initial shock that sets off a recession, other factors may be more important in prolonging the recession.

    • Logically, both statements can be true. Historically, there are clear examples where recessions (or depressions) have been caused by financial crises. The paramount example is the Great Depression, caused by the Federal Reserve reducing the money supply by roughly a third. An example of the other way around might well be the recent Great Recession of 2008-2009. That recession was caused by very bad federal government housing policy. Yet, once it got going, it caused a huge financial crisis through the growing instability of banks.

      By the way, although it is perfectly acceptable to attach a comment to a page, you may get more people to read it and comment on it if you post it at the end of a relevant post. In this case, you might have posted it at the end of the post on the causes of the Great Depression, or the one on the Great Recession.

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