Letting the Recession Happen

While Wall Street celebrates the possibility that the Fed may lower interest rates further, and inflate the money supply, Lew Rockwell points out the path that should be taken instead:

"...shouldn't we do something to address the credit crunch? Yes, and that is the following: let it happen."

Just let it happen.

This advice is hardly ever followed, even though many of the malinvestments from the previous boom would be flushed out, and the economy could then proceed on a better footing. Instead, creating further malinvestment is the choice du jour.

Murray Rothbard warned of prolonging the boom: 

"It is clear that prolonging the boom by ever larger doses of credit expansion will have only one result: to make the inevitably ensuing depression longer and more grueling.”