Manias generally have been associated with the expansion phase of the business cycle, in part because the euphoria associated with the mania leads to increases in spending. During the mania the increases in the prices of real estate or stocks or in one or several commodities contribute to increases in consumption and investment spending that in turn lead to accelerations in the rates of economic growth. The seers in the economy forecast perpetual economic growth and some venturesome ones proclaim no more recessions - the traditional business cycles of the market economies have become obsolete.From Manias, Panics and Crashes: A History of Financial Crises
Thursday, 11 June 2009
Sorry to knock the team, but who does this make you think of?