Credit Shortfalls Caused the Recession

At least that’s one theory. And the policy recommendation is more quantitative easing.

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About J@m3z Aitch

J@m3z Aitch is a two-bit college professor who'd rather be canoeing.
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One Response to Credit Shortfalls Caused the Recession

  1. Dr X says:

    Not much time now, but I do want to point to the possibility of a binary fallacy in his dismissal of the role of uncertainty based upon the level of investment in software and equipment. Specifically, there are degrees of uncertainty and associated costs of risk, wherein one type of investment is seen by an organization as having a low risk-cost, while great uncertainty in another area of investment makes for a very high cost of risk. Because an organization invests in certain areas they see as relatively non-risky when they’re flush with cash, doesn’t rule out the presence of powerful effects based on uncertainty in other areas of activity, even though the cash to invest those areas is available.

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