Debt is the result of free economic agents allocating savings into what they believe are the most productive investments. Therefore to criticize debt is to criticize the free market itself. A central bank doesnt make people crazy, US had bubbles before 1913 Greenspan didnt put a gun to Chuck Prince's head, matter of fact, Greenspan had nothing to do with Prince's ability to finance itself at low rates over LONG periods, given that he targed overnight fed funds If one wants to limit people's ability to borrow, they are acting against the essences of Laissez-faire, which is freedom to take risk and act
You clearly never read her, so no point in discussing, but I will indulge. Rand's worldview was based on the belief that there are indeed hard-working, self-interested individuals in the world who do not seek to exploit their fellow man, and that these people are the drivers of improvement in human living standards. This is demonstrably true. I don't understand what Marx has to do with this discussion, since he did not believe that human living standards can actually increase. He believed in the 'fixed-pie' model of wealth, and his whole worldview is based on the presumption that wealth for one person means privation for another. This is demonstrably false. If you really believe that there is no difference between earning and taking by force, than you are a helpless piece of human scum.
Check out the recession of 1920-21. Double-digit deflation, no stimulus spending (in fact the federal budget was cut), no extreme New Deal measures or controls. If your "negative feedback loop" led to the roaring 20's, bring 'em on
My point is simple. All I am saying is that trying to prohibit fractional lending is like trying to prohibit consumption of alcohol. Both have been tried and both just don't work, in practice. Reason being, simply, that you can't 'fade' human nature.
Didn't get past this point I'm afraid The only bit of Atlas Shrugged I skipped was the mind-numbing forty (?) page monologue. Seemed about as worthwhile as trying to wade through Marxist BS. As to her other writings - can't say I bothered. I think I got the idea after round one.
Austrians have no problem with debt, just the mis-pricing of it caused by central bank/government interference. "Criticize debt is to criticize the free market itself." Are you on crack? Debt is completely compatible with free markets- I have 5 dollars, you need 5 dollars; You promise to pay me back 6 in a month, I agree. Debt created, free of government or CB. Go back and study how infrequent and quickly resolved bubbles were before 1913. In addition, most had roots in some sort of monetary expansion- eg gold rush booms. As for Citi and Greenspan, of course the Fed encouraged Prince to take excessive risk to chase yield. Why not when money only costs 1%? And this crap about the Fed not controlling the long end is bullshit. Raise short rates to 10% and see how quickly long rates rise. Who would lend for 30 yrs at 4% when you can get 10% in a savings account? No one.
Seeing how those 40 pages were the whole point of that novel, I stand by my assertion. Maybe you read a bit, but with no understanding.
That was one of the most severe recessions on record, it is also matched by a peak in the money supply in 1921 and through in 1922/23. In order for you to counter my statement the money supply would have to continue to decline and the economy to boom. That didnt happen, deposits continue to grow quite positively till 1930 after 1922/23
Infrequent? There were multiple boom-bust cycles and outright depressions in the 1800s, their effects and aftermaths lasting for many years at times... contrary to the Austrian's credo that all recessions/depressions are quickly resolved if you let everybody and everything fail, because the "free market system's self healing forces" enable quick recoveries after a short 12 or so months if "just let to it's own devices": 1837 1857 1873 1893 It's not like roasted chickens were flying straight into the mouths of the working class before 1913.
1837- Caused by paper money inflation 1857- Caused by inflationary boom resulting from 1840's gold rush. But over in two years. 1873- Caused by government artificially contracting the money supply by demonetizing silver. 1893- Silver remonetization (sort-off) in 1890 caused inflationary boom. Over in one year. Government interference or fractional reserve banking were behind each case, except 1857. But at least they were relatively infrequent and short compared to post 1913, when fractional reserve banking was cartelized with the federal reserve act.