Quote of The Day: Common Knowledge of the Trade Cycle

"A closer examination reveals that from out of the conflict of the various theories of the trade cycle a common core of knowledge has gradually been built up in the course of the last decades. To this belongs especially the fundamental recognition that the real causes of the crisis must be sought not in the economic conditions of the moment of the crisis but in the mechanism of the preceding boom, and the further recognition that the mechanism of the boom culminates in an increase of capital investment financed by an expansion of credit which, via a chain of reciprocal reactions, eventually sets the whole economic system in motion."

                                                                                                        - Wilhelm Röpke (1936)