Have you taken out a mortgage, invested capital or bought shares? If you have, likelihood is you lost out in the latest bust. When the world’s financial bubble blew, the solution was to lower interest rates and pump trillions of dollars into the sick banking system. “The solution is the problem, that’s why we had a problem in the first place”. For Economics Nobel laureate Vernon Smith, the Catch 22 is self-evident. But interest rates have been at rock bottom for years, and governments are running out of fuel to feed the economy. The governments can save the banks, but who can save the governments?
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