RBC makes a booboo

Here we have unaltered real GDP from the Wiki description of the Real Business Cycle.  Preceding each crash we have a period of false stability. That period of calm is generally government masking volatility from us, and we fail to keep our reserve ratio at its natural state.  That is the cause of the RBC, that is the boom/bust cycle. If our natural reserve ratio is 1`5%, and I do, then that real gdp curve should have a 15% volatility, and it doesn't.  We are falsely led into an adjustment by accounting fraud that is masking the volatility, likely DC. Once our reserve ratio drops below its normal, we are subject to major corrections from small perturbations.

It is not always this way, sometimes real shocks happen. But you can see that since 1980, the accounting fraud from DC has grown worse, causing various and unnecessary crashes. We know why government does this, they can avoid the pain of real democracy. During crashes, the Fed can bury a lot of the uncovered inflation, for a while. Then government debt buries a bunch more. But the game is over, it is time for DC to pay the price and the cost will likely fall on the small states that control the Senate.