The headline is a ruse; it’s actually the same this time. The times it was different were in 1987, 2000, and 2008. We’re talking about the economy and stock market crashes, of course. In all three of those recessions, there was a so-called V-shaped recovery in which the economy and the market bounced back fairly quickly. Those times were different and not the norm at all. What’s coming now is much more akin to serious historical economic problems.

In 1987 was the Saving and Loan crisis. Instead of bailing out the failed Savings and Loan banks, the government insured the depositors. That’s the exact opposite of what they did in the 2008 housing crash when they bailed out all of Wall Street. In the 2000 technology crash and in 2008, we had disinflation, the definition for which is not very good. We got disinflation by shipping manufacturing and production overseas; prices on many things stayed flat relative to inflation in domestic items and services. Technology is the best example; computing power has doubled several times in the last 20 years, but the price of a PC is still 600 to 1000 bucks. T-shirts at Walmart are another good example; they are (were) still 7.99 to 12.99 and have been for decades. But those prices are now on the rise.

The point of that boring background is to say this: the economy is in real trouble this time, something America hasn’t seen since the 1970s, two generations ago, and governmental mismanagement is exacerbating the conditions of the setup.

Steve Forbes isn’t wrong, but he is part of the supply-side establishment that got us into this mess.

The ‘real cure’ for inflation has gone ignored, Steve Forbes says

In focusing on raising interest rates to cool inflation, central banks and governments have overlooked the importance of maintaining stable currencies, said Steve Forbes, chair of Forbes Media.

[…]

“Today, unfortunately, not only is the Biden administration putting up obstacles to deal with supply-side problems, but also the Federal Reserve and other central banks think you have to depress the economy to bring inflation down,” he said, disputing the idea that a recession is the only solution to combating inflation.

“They do it by artificially raising interest rates. So they have fewer people employed … that is not the real cure,” he said.

“The real cure is to stabilize the currency. You don’t have to make people poor to conquer inflation.”

The money printing started a century ago, but the profligate printing started by Trump bailout checks and continued by Biden’s democratic policies to “recover” the economy from the “pandemic” is backfiring. There’s no more disinflation to cover the cost of money printing. The lowest practical overseas wage has been realized. Moving manufacturing to Africa is not a viable solution, so there’s nowhere else to seek lower wages. That’s but one set of problems. The war in Europe is another thing. But the worst problem is cutting off domestic energy and food production coupled with hyper-regulation of mineral exploitation and use; those choices will be crushing.

The conditions are not favorable at all for an easy recession that recovers quickly. Those last crashes were sudden; this time, it’s coming on slowly and will likely be long and grinding. Tell your family you love them.