US Credit Boom and Bust

Here's a nice graphic (from here) that summarizes the the financial crisis. (What isn't shown is the similar picture for the technology/dot-com boom-and-bust from early 1990s until 2000.) In short the US has had the worst decade of financial performance since the Great Depression because it has been hit by two bubbles that collapsed.


What is utterly amazing is during this whole time economists have been patting each other on the back about their expertise and how they had tamed the economy (the Great Moderation) and now growth was carefully managed (the fantasy of supply-side trickle-down economics). This confidence in economic ideology is the ultimate hubris that came before the fall.

Remnants of the radical right have yet to admit that their belief unregulated, down-sized government has failed. But the previous decade puts "proof positive" to their arguments and the bankruptcy of their thinking.