Wednesday, May 21, 2014

Sheila Bair on the Business Cycle

In her review of Timothy Geithner's new book, Stress Test: Reflections on Financial Crises.

Sheila Bair,who was chairman of the Federal Deposit Insurance Corporation from 2006-2011, writes:
I agree with Tim that there will always be financial cycles and a need for government interventions. 
I wonder if she has ever heard of  Austrian business cycle theory, which, of course, explains why the business cycle occurs and how they can be eliminates. Short explanation: Central bank money printing results in the business cycle, eliminate the money printing and you eliminate the business cycle.

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