Simon Johnson:
One danger inherent in pushing for high growth is that it is always possible to juice an economy with short-term measures that encourage a lot of risk-taking and leverage in the financial system. Deregulation in the 1990s and early 2000s did exactly that, leading to slightly higher growth for a while – and then to a massive crash.
1 comment:
But it wasn't only deregulation that created the "slightly higher growth". It was also the SLOWER growth of debt from the mid-1980s to the early 1990s, along with the FASTER growth of circulating money in the early 1990s.
Maybe I should look into this...
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