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Legal Commentary

: Economics of Contempt

What Scares Me

By Anonymous

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What could still cause a complete meltdown of the global financial system? Economic growth in Asia slowing so much that the Asian central banks -- particularly the People's Bank of China -- decide that monetary policy should be focused on fighting possible recessions rather than intervening in the foreign exchange market (i.e., buying U.S. government debt).

Yes, China would just be hurting itself, and it would be an objectively irrational decision. But that doesn't mean they won't do it anyway.

That scares me. And it should scare you too.

Full post as published by Economics of Contempt on October 14, 2008 (boomark / email).

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