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Monday 21 Aug 2017 | 13:20 | SYDNEY
Monday 21 Aug 2017 | 13:20 | SYDNEY

'And don't speak too soon...'

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7 June 2012 12:11

Back when I was trying to find a silver lining to the great GFC cloud, I used to cheer myself up by arguing that at least we had learned the lessons of the Great Depression and weren't about to re-run the disaster that was the 1930s.

Reading some of the commentary over the past couple of days makes me wonder whether I was too optimistic. Martin Wolf:

Before now, I had never really understood how the 1930s could happen. Now I do. All one needs are fragile economies, a rigid monetary regime, intense debate over what must be done, widespread belief that suffering is good, myopic politicians, an inability to co-operate and failure to stay ahead of events. Perhaps the panic will vanish. But investors who are buying bonds at current rates are indicating a deep aversion to the downside risks. Policy makers must eliminate this panic, not stoke it.

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