Business Cycles

America's first great depression arrived without a villain: no embargo, no war, no single blundering minister to blame. It seemed to rise out of the economy itself.

Keynesian theory says that the way to end a recession in which the economy is in a “liquidity trap” is for government to ramp up spending. Murray Rothbard demonstrated that this policy actually blocks an economic recovery.

Mark Thornton uses Austrian theory to explain where money came from — Menger's bottom-up origin of money — and why gold makes for sound money and smaller government.

The recession isn't the disease, it's the cure. Patrick Newman on why the Austrians blame the boom, not the bust, and trace it all to one cause.

For a while, some economists tried to claim that business cycles are the result of significant changes in technology. The Austrians have a better explanation.

Bob uses U.S. economic history, centering on the greenback era, to work through some subtle but important distinctions in Austrian monetary theory.

Intervention begets intervention. This was the case following the American Revolution, as the consequences of inflation, credit expansion, and wartime disruptions set up for the depression of 1784 in peacetime.

Intervention begets intervention. This was the case following the American Revolution, as the consequences of inflation, credit expansion, and wartime disruptions set up for the depression of 1784 in peacetime.

The two great confusions about money and interest, from Aristotle’s “money cannot beget money” to modern credit expansion, and how monetary manipulation by banks and governments produces inflation and the business cycle.

In the wake of Alan Greenspan's recent passing, Bob revisits two contested claims about his legacy: did the Fed under Greenspan fuel the housing bubble, and did that bubble cause the 2008 financial crisis?