President Obama explains it all. He and many liberal economists
explain the Great Recession like this: Rising income inequality
and stagnant incomes for the bottom 99% pushed workers to borrow
to maintain their standard of living. As these households became
increasingly indebted and their incomes went nowhere because the
1% were grabbing all the dough, they continued to borrow more
from fraudster banksters to maintain their consumption levels.
This increased leverage for consumers and banks, and eventually
a shock to the economy led to a financial crisis. The 2000s were
just like the Roaring 1920s. Blame the rich. Income inequality >
too much borrowing > financial crisis and recession. A simple
theory. An elegant theory, really. But quite probably a wrong
theory—or so economists Michael Bordo and Christopher Meissner
contend in a new study (bold for emphasis): Using data from a
panel of 14 countries for over 120 years, we find strong
evidence linking credit booms to banking crises, but no evidence
that rising