Animal Spirits

I was watching a government TV show called NewsHour which had a report from an economics conference in San Francisco. Apparently Austrian economists do not get invited, so when asked "how come you did not see the bust coming?" the answers generally had to do with the failings of people who make up the market. One fellow said making money is like a drug and people get loaded and risky, one said we were lied to by banks and wall street, another said it was like a greek tragedy where human weakness overcomes good policy, and one complete idiot said it was a failing of "animal spirits" and has written a book with another top economist, called Animal Spirits, to make his argument. Talk about VooDoo economics! I will not read this book.

What happened is very simple, and since I know this I made money during the bust and am still doing so: govt policy was to loosen credit too much and print too much money. Once they play that game, the experts I followed can advise you to the week of making the right moves.

The conference was attended by several thousand people, not a single one providing any economic benefit whatsoever, but paid handsomely by government or big biz.

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