The crash of 2008 was unique. It was not triggered by a war, a shortage of raw materials, a famine or indeed any external factors.
It was caused by a massive expansion of credit that was condoned by regulators and the authorities. When cheap and readily available credit disappeared at the Minsky Moment (when consumers started to reduce debt rather than increase it) in the summer of 2007, it left everyone gasping for money. One day it was there and the next day it was not. Why? Bizarrely, it might have been the abundance and pervasiveness of the regulatory authorities that increased consumer appetite for debt that created the bubble in the first place. Could it be the confidence from knowing “some official has review...
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