" ... historically, the U.S. has been very good at #speculative #bubbles. This is one of our main core competencies here. They tend to be about real estate, or they tend to be about #technology, or they tend to be about loose #credit, and sometimes they even have a #government role with respect to some kind of perverse incentive that was created. This is the first #bubble to have all four. We’ve got a real estate component, we have a loose credit component, we have a technology component, we have a huge government component, because we’re told “we’re in an #existential #crisis with #China, and we must win this at any cost.” So all of those forces together means that you have people looking at it through four different silos and lenses, rather than just saying, like in the global financial crisis, “it’s always about real estate and credit.” Or in telecom, “it’s about technology and loosely some credit.” This is the first one where you end up in the rational bubble theory of all of this, where everyone feels like they’re doing something rational. Yet in aggregate, all of these different people who are looking at the problem through their own lenses are actually profligate contributors to the problem, because it’s the first one that combines all of the forces that historically have made some of the largest bubbles in U.S. history."
https://paulkrugman.substack.com/p/talking-with-paul-kedrosky
