3 mistakes of the great depression

It's very clear to every economist on the planet. I know that economists are borderline on actually being Scientists. But.... There are 3 classic behavioral mistakes.... and these are mistakes driven by our Lizard brains, in this time of crisis. A time when we need to do what is hard, not what is easy. It's like eating your vegetables, though they seem unappealing... they are very good for us.

1. It a time when the Velocity of money is contracting, Worrying more about the national debt than getting money/blood circulating in the economy.
2. Allowing large institutions to fail, Sure it feels good. Problem is it causes a crisis in confidence in the economy. Our financial system is a confidence game... No confidence, No game. Though that sounds like fun.... It won't be. It's how you get guys wandering around the country in box cars looking for work.
   
3. Protectionism. which has a tenancy to set off trade wars and further constrict global trade.
   

There is this very stupid argument about "what we are doing is going to create a stagnant economy." Unfortunately there is some truth here, my issue is the Tense being used. WHAT WE DID, IS GOING TO CAUSE A PERIOD OF STAGNATION. But economic consolidations are NORMAL. The idea that the economy can just go straight up all the time, is the thesis of a child.

Then there is this thesis of china, and currency. I'm not sure who is tracking what is going on in Europe, but besides Germany, there is limited economic stregnth in europe. The lack of central economic focus in Europe, is the weakness in the EURO. creating a global currency is silly, it will cause the same weakness in curency. the stregth of the dollar is stability of government, and central economic focus.

Our biggest worries are about Social stability, and global social stability.

If you get a chance check out the newest episode of Frontline on the national Debt. It's a concern... but you also have to understand that Debt to GDP was highest just before one of the largest economic expansions in US history, Post WW2. High Debt=bad economy is not a reasonable corollary.

or go to PBS