Tag: credit
Will Corporate Debt Set Off the Next Financial Crisis?

Corporate debt was not one of the big culprits of the financial crisis a decade ago. But it might well be next time around.

The Data Don’t Justify Financial-Market Panic

As the hysteria has grown in the discussion of financial markets and related government policies, I have been puzzled by the discrepancy between the best available data and the descriptions quoted in the press—statements by financial gurus, traders, and professors, as well as by government officials. To hear these spokesmen tell the story, you’d...
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Two Unspoken Assumptions in the Credit-Crisis Debate

In the heated, sometimes almost hysterical discussions and debates of the “credit crisis” now swirling through the press, the Internet, and the programs broadcast on radio and television, nearly everybody is making two, usually implicit assumptions: I. The volume of outstanding credit should never decline. II. If the volume of outstanding credit has declined, the government should act to reverse that...
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Metaphors Reveal the Economic Ignorance of Politicians and Journalists

The past few weeks have been a difficult time for economic educators. Never has it been more obvious that all their efforts have been in vain. Neither the politicians nor the journalists, who have been spewing out words at a rapid rate with regard to the so-called financial crisis and the proposed financial bailout, have a...
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Credit Is Flowing, Sky Is Not Falling, Don’t Panic

In democratic societies, every great surge of the government’s size, scope, and power rests on a foundation of fear, and the present occasion is no exception. The president, the secretary of the treasury, congressional leaders, and the vultures now swarming Washington to pick the remaining flesh from the taxpayers’ bones would have us believe that unless the...
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Crunchy Credit

Robert Higgs has offered several very interesting posts about the supposed “credit crunch,” (here, here, and here) noting that this is not in fact a technical economic term but rather a phrase invented by journalists and pundits. He asks the important question: if it’s a “credit crunch,” why aren’t real interest rates soaring? Then,...
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