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| As manufactured credit balloons, savings disappear and the marginal productivity of debt collapses |
"The Austrians may have had it right all along: ...ineffective central bank policies, which cause interest rates to remain too low for too long, resulting in excessive credit creation, speculative economic bubbles and lowered savings.”.
~ Lance Roberts from his post (and tweet) 'There Will Be No Economic Boom'
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1 comment:
Note that almost the entire mainstream view on economic growth sees it coming as a result of borrowing -- of borrowing created out of thin air.
So ask yourself what it means for this theory when both savings and the marginal productivity of debt are rapidly declining.
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