Irish Liberty Forum

When More of the Same = “Very Different”

with one comment

I sometimes feel like I’m living in some kind of bizarro world. Eichengreen and O’Rourke have done an excellent job at tracking the Second Great Depression. Here is the link for those of you who’ve been living in a cave. After showing us excellent graphs of falling industrial output, they graph the overall policy responses of governments and central banks in 1929 and 2009. Take a look:

Interest rates: how low can you go?

Interest rates: how low can you go?

Budget deficits (7 country average)

Budget deficits (7 country average)

Now the conclusion to draw from this surely is: “world governments and central banks are doing exactly the same as what they were doing in 1929 only on a bigger scale”. And yet, this is not the conclusion that E-O draw: “The good news, of course, is that the policy response is very different.” Bizarre, no?

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Written by 20000miles

August 16, 2009 at 3:03 am

Posted in economics, history

One Response

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  1. Delighted to see this return.

    Trevor Mitchell
    http://www.irishshopper.com
    For all things Irish

    Trevor

    August 24, 2010 at 11:45 am


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