Is 2008 like 1971?

This is funny, via Ezra Klein (who is also funny), but of course it misses the point.  One big difference is that we use energy much more efficiently than we used to.  Expensive oil needn’t crush us.  The second big difference is that the Federal Reserve is far more competent today than in the 1970s.  That is true even if you are not a Ben Bernanke fan.  The third big difference is that a negative shock or financial collapse from China could crush us today, but not in 1971.  Whoops, forget that third difference.


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