June 10, 2011
Is Permanent Recession the New Normal?
It really is a Great Recession now. You have to be around 90 to even remember an economy like this. The United States has not experienced two straight years of 9% unemployment since before the Second World War. As Amity Shales wrote in The Forgotten Man, it was the duration of the economic collapse which began in 1929, not its severity, which created the Great Depression. According to the Bureau of Labor Statistics, the United States has now had unemployment of 9%, give or take a couple tenths of a point, since May, 2009. The most recent figure, for May, 2011, is 9.1%. In a speech on Tuesday, Fed chairman Ben Bernanke essentially threw up his hands. He's right. The Keynesian economic toolbox is empty. So is monetary policy -- unless you want to radically inflate the economy and depreciate the dollar. China and other nations are already challenging the dollar's status as the world's sole reserve currency. Revving up the printing presses at the Bureau...(Read Full Article)