Discussion in 'Economics' started by hermit_trader, Feb 19, 2009.
I feel the boom and burst cycle become shorter and shorter. Is it true?
One theory I subscribe to is supply side economics exaggerate the normal business cycle and the Alan Greenspan style of economics, Greenomics, has hit its climax. These extreme ups and downs are not normal and do not need to exist.
The more the FED prints the shorter and more violent they get.
What we need is sound money and an actually free market economic system. Not this garbage mixed economy, yes mixed. We have not had a free market economy since the inception of the federal reserve.
They used to be shorter in both the short run and long run. Since the fed they are shorter in the short run and longer in the long run.
Not at all. In fact, the overall cycle length has been expanding, primarily due to the fact that expansion lengths are growing exponentially (see my other post: 'singularity is near').
The good news to think about if you are biased long, is that the contractions have been getting comparably shorter in duration. There is certainly large asymmetry in the durations, and it pays to hedge on the side with greater bias IMO. Although it might not matter much if you are only scalping on very short intervals.
No one can predict the future, but if you want to make inferences, might as well make them based on historical facts.
jueco2005 got it right.
In fact, my argument may be a bit clearer looking at it from this perspective.
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