Economist's View: "The Great Contraction of 2008-2009"
The Great Contraction of 2008-2009, by Kenneth Rogoff, Commentary, Project Syndicate: A popular view among economic forecasters and market bulls is that “the deeper the recession, the quicker the recovery.” They are right – up to a point: immediately after a normal recession, economies do, indeed, often grow much faster than usual... Unfortunately, the Great Recession of 2008-2009 is far from being a normal global recession. The Great Recession was turbo-charged by a financial crisis,... a far more insidious affair that typically has far more long-lasting effects.
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I am often asked why economies get themselves into such a bind again and again throughout economic history. Unfortunately,... the answer is all too simple: arrogance and ignorance. Investors and policymakers are often altogether ignorant of the myriad historical experiences with financial crises. And the few that are dimly aware of what has happened in other times and other places all too often say, “Don’t worry, this time is different.”
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