'What causes depressions is an unsustainable runup in credit and debt that precedes it..'

'Most people, of course, don’t give any thought to credit expansion...'

- Ludwig von Mises, '..to defeat all those ideological forces that are operating in favor of credit expansion.'



'What causes depressions is an unsustainable runup in credit and debt that precedes it, NOT a failure to go deeper in debt.'

- Mish, Yet Another Keynesian Clown Steps Up to the Plate: Leo Kolivakis at Pension Pulse, June 28, 2010



'Like alcohol, a debt boom tends to induce euphoria. Traders and investors saw the asset-price rises it brought with it as proof of their brilliance; central banks and governments thought that rising markets and higher tax revenues attested to the soundness of their policies.

The answer to all problems seemed to be more debt. Depressed? Use your credit card for a shopping spree “because you’re worth it”. Want to get rich quick? Work for a private-equity or hedge-fund firm, using borrowed money to enhance returns. Looking for faster growth for your company? Borrow money and make an acquisition.'

- Philip Coggan, A special report on debt, Jun 24th 2010



'The Lessons of Greece

Keynesian fiscal stimulus is nothing but a Ponzi scheme and all Ponzi schemes come to an end.

Such revelations will not stop the Keynesian fanatics from preaching because No policy ever performs badly enough to cause its disciples to abandon it.

However, the lesson from Greece are ...

1: Deficits do matter.
2: Eventually the market will force austerity whether the Keynesian and Monetarist clowns like it or not.'

- Mish, The Economist "Rising Government Debt is a Ponzi Scheme", June 28, 2010



'Children whose parents are being destroyed by debt now, will keep those memories for a long time.'

- Mish, Peak Credit, June 25, 2008