Household Debt Did Not Cause the Great Recession

It Wasn't Household Debt That Caused the Great Recession - Heather Boushey - The Atlantic: "“Economic disasters are man-made,” they write in the opening pages, “and the right framework can help us understand how to prevent them.” By the end of the book, the reader cannot but be left appalled at the sheer enormity of the policy failures. It’s not just that 7.4 million workers lost their job during the years of the Great Recession of 2007-2009 but also that the employment crisis continues to this day. While jobs are no longer being shed at the rate of 20,000 a day, the share of the U.S. population with a job fell to a low of 58.2 percent in November 2010 from a high of 63.4 percent in December 2006, but has only increased by a fraction of a percentage since then, hitting just 58.9 percent in April 2014. Missing the housing bubble was a massive failure on the part of policymakers. As a result, our new normal is one where there are nearly 10 million fewer people at work. This book's contribution helps us understand the important mechanisms through which this occurred."  (read more at link above)

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