1/13/14

Would you prefer to live in the ascendancy of a civilization, or during its decline?

Human beings are… of two persuasions,
the first would spend tomorrow what they earn today,
the second would spend today what they hope to earn tomorrow.

From this…arise all conflicts that lead to economic crises,
to panics, depressions, violent and revolutionary transfers of wealth
and perhaps most wars.

Freeman Tilden

If advertisements and anecdotal news stories
promote extraordinary investment returns with minimal mention of risks,
along with plentiful and inexpensive financing,
and after unexpectedly high returns for some,
collective acceptance motivates others to borrow and invest more,
creating even higher prices,
why would proponents want to maximize available liquidity
and endeavor to minimize withdrawals?

There is no means of avoiding the final collapse of a boom
brought on by credit expansion.

The question is only whether the crisis should come sooner
as a result of abandonment of credit expansion,
or later as a final and total catastrophe of the currency system involved.

Ludwig von Mises

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