Two Centuries of Parasitic Economics by Basil Al-Nakeeb

Author:Basil Al-Nakeeb
Language: eng
Format: epub
Tags: growth, national debt, plutocracy, deindustrialization, capital tax, alternate banking, dollar exchange rate, economic dogma, social security tax, taxing interest
Publisher: Basil Al-Nakeeb

United States Cyclical Contractions (1785-2009)

With the proviso that early statistical data was less reliable and less detailed, in the 224 years between 1785 and 2009, the United States experienced forty-nine economic cycles. The data shows that US cycles underwent major change after 1941. Accordingly, it was logical to split US economic cycles into two groups, with January 1, 1942, for a cutoff date, as follows:

1. Table 11.1 covers the period from 1785 to 1941

2. Table 11.2 covers the period from 1942 to 2009

The final row of each table is important because it provides a summary about the cycles and their contractions during the period concerned. Table 11.1 shows that during the first period there were thirty-seven cycles. Of these, twenty-three were credit crises, with at least some of the following characteristics: rising interest rate, credit contraction, the burst of a speculative bubble, a market crash, panic, bank failures, and deflation. This confirms Fisher’s diagnosis that credit contractions were a major cause of recessions and depressions. The remaining fourteen contractions had various causes including falls in aggregate demand, peace recessions following the end of hostilities, and trade restrictions imposed by Great Britain. The final row of Table 11.1 also reveals that during the era of classical and neoclassical macroeconomics and laissez-faire, cycles were shorter and contractions were longer and deeper.

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