As can be seen from this chart stolen from Tim Duy. (HT Thoma)
Notice that the recession had already begun before the consumer began to save. The sequence of events: 1) Hank Paulson pees pants 2) Consumers react to the panic by saving.
Showing posts with label economics paradox of thrift. Show all posts
Showing posts with label economics paradox of thrift. Show all posts
Friday, January 15, 2010
Paradox of Thrift is a dead theory
As can be seen from this chart stolen from Tim Duy. (HT Thoma)
Notice that the recession had already begun before the consumer began to save. The sequence of events: 1) Hank Paulson pees pants 2) Consumers react to the panic by saving.
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