Free market capitalism's normal business cycle of over-inve…

Twetch · November 9, 2019

Free market capitalism's normal business cycle of over-investment and excessive risk-taking is naturally followed by a reduction in debt, the liquidation of bad loans & excess inventory, reduction in risk, etc.

This is natural human psychology.

Replies

Twetch · November 10, 2019

While this has been true for a long time, since capitalism has existed in an environment where banks have been able to issue fiduciary media, I suspect it will become a much more stable process once this ability is lost.