In ABCT and the Community Reinvestment Act (CRA), Peter Klein makes readers aware of new evidence, contra Krugman, that Federal housing policy, and especially the CRA, significantly contributed to the financial crisis.
Austrian business cycle theory explains the general pattern of the boom-bust cycle — credit expansion, lowered interest rates, malinvestment, crash, liquidation — but the particulars differ in each historical case. (Austrians sometimes distinguish “typical” from “unique” features of each cycle.) To explain particular episodes, we appeal to specific technological, regulatory, political, legal, or other conditions.
Neil deMause writes in Slate of “Georgia’s Hunger Games“:
“Fewer than 4,000 adults in the southern state receive welfare, even as poverty is soaring. How Georgia declared war on its poorest citizens—leaving them to fight for themselves.”
He compares Georgia unfavorably with other states, specifically California and Maine.
[Editor’s note: Bernanke has further loosened the Fed’s monetary stance. As economist Frank Shostak explains, this action is based on a fundamental misunderstanding of how wealth is created and can only make things worse.]
On Wednesday December 12, 2012 Fed policy makers announced that they will boost their main stimulus tool by adding $45 billion of monthly Treasury purchases to an existing program to buy $40 billion of mortgage debt a month.
For Hayek, ”Justice is an attribute of individual action. I can be just or unjust toward my fellow man.” But ”social justice” is a “meaningless conception.”
