The prior negligence is understandable. Not only was Mr Minsky on the fringe of mainstream economics, his core insight is antithetical to the Fed. The Fed’s raison d’etre is stability: stable prices, stable employment, financial stability. But Mr Minsky argued that economic stability encourages more risk taking and leverage, and ultimately produces more instability and bigger recessions.
Friday, January 08, 2010
Minsky and the Fed
The Economist looks at Minsky and the Fed