alt Hacker NewsI think it was a good call, yes. A deflationary collapse is incredibly damaging to the economy. The Great Depression was such a collapse, but there are others. The Panic of 1857, 1873, 1907... there's a long history of these.
The Fed avoided that. And they also avoided causing inflation. It was an amazing job of threading the needle. (One could argue that they caused a decade of stagnation, but in my view that was minor compared to the other options.)
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Thank you for the thoughts. Do you think if we had ripped the band-aid off then it would have been completely disastrous? I don't mind saying that this economy is frustrating, and it feels like we keep kicking the can down the road. I'm confident I'm not the only person that feels this way, and I'm quite open to being wrong here. My guts says there's just too much money sloshing around, and it gets vacuumed up, leaving the majority feeling like nothing changed.
I'm asking this in as non-confrontational way as possible, what am I missing?
I have really tried hard to figure out the counterfactual as being a good thing and it is just really hard to make the argument that we would have been better off with a deflationary collapse.
This is especially true from a global perspective. It would be a much more equal global economy but unimaginably poorer. The political consequences are unknowable but a deflationary collapse would not have had good political outcomes.
We largely shifted a nightmare into being a great time to be alive but take the good times completely for granted because we can't really know the nightmare we didn't see.