In today’s article I’ll go through Brad DeLong’s recent defense of Greenspan’s policies. DeLong’s argument is of particular interest to Austrian economists, because he relies on Wicksell’s “natural rate” of interest, a concept that Ludwig von Mises adopted for his own explanation of the business cycle.
I find DeLong’s defense somewhat perplexing. Even on the Wicksellian criteria that DeLong sets up, Greenspan failed and should be held at least partially accountable for the housing boom. FULL ARTICLE