Visualize a sinking ship with captain and crew frantically bailing out water to keep the ship above the waves. Now, instead of a great wooden vessel, imagine a credit-inflated rubber raft from which credit is leaking through numerous holes. Policy makers are desperately pumping more credit into the raft to stop it from going down. That raft is the global economy. Humanity lives on top of it. There are no lifeboats. If the raft sinks, people are going to die.
That harsh reality is driving and will continue to drive economic policy.
The prospects for rescue are far from certain, and in fact, diminishing with each passing month. Nevertheless, policy makers can be counted on to keep pumping credit into that raft until their strength runs out. They are lost at sea and don’t know what else to do.
—Richard Duncan, The New Depression, ch. 7
Buy it. Read it. Very sobering stuff, but an essential guide to understanding what has been happening in the world economy over the past few years, why politicians are doing what they’ve been doing, and what, if anything, can be done going forward.
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