The Economy

[kandrathe]

Well, I stand back a bit, squint, and it looks like if you extend the trend (growth, but declining growth) of the mid 20's you hit the curve again about '37 or '8. The bubble starting in '28, the burst of '29, and the whole '30 to '37 (maybe '38) depression looks just like a big blip in a gradually growing economy. Of course, you can't really go back much before '20 (WW I and post war effects) or after '39 (WW II effects). A lot of industrialization going on from about the turn of the century, so a longer baseline really doesn't exist.

That is what I saw as well.

Oh, and BTW, isn't the bottom exactly where one should measure recovery from? After all, from the peak to the trough is the decline and from the trough to the next peak *is* the recovery.

My take on it is the neither peak nor valley but rather the deviation from the norm, and examining the probable causes for those deviations. It is clear that the actions of the government during the Hoover administration caused a bad situation to go very bad, but it is not clear to me that "The New Deal" did anything more than subvert the reins of government power. What is interesting to me is that Keynesian's only follow his advice for increased government spending in the bad times, but never balance the budget and run surpluses to pay back the debt in the good times. They just take the increased revenues and spend more.

Frankly, unless we develop experimental cosmology then sociology, economics, government, foreign policy, etc., are all belief systems, not sciences nor even supportable theories. Wake me up when we have a means of running controlled, repeatable, experiments;)

I'm with you on separating the statistical modeling sciences, from the *hard* sciences. The best you can hope for is a good simulation.