Bubbles were no accident.
The massive expansion of credit was the only way to cope with manufacturing overcapacity.
If this is correct, there is no easy fix for our problems.
The blowing of asset bubbles is not an unfortunate side effect of regulatory capture or Wall Street’s greed.
It was the only way governments could keep economic growth from falling below politically dangerous levels once traditional Keynesian methods of fiscal stimulus through deficit spending were no longer adequate to compensate for the sclerosis at the heart of the advanced capitalist economies: “worsening difficulties with profitability and capital accumulation.”
via Yves Smith.