Is it possible for the broader economy to be more stable while individuals are less stable? It seems counter-intuitive, but it makes sense. Lifetime employment is long dead, and it seems like the social contract of the earlier post-WWII era has been sundered forever 1. And yet, the broader economy is more stable than ever, even with the current dislocations. Economic cycles have been dampened, inflation seemingly tamed. Perhaps it is like how the San Andreas Fault creeps along instead of letting the pressure build up, and then violently releasing it in a massive earthquake. The economy creeps along, lubricated and stabilized by the fortunes and failures of millions of individual economies. Perhaps that will keep the mortgage collapse from becoming an economic collapse. I'm no economist.

¶ 1583 Posted at 07.53 AM ⇒ No Comments ( money | deep thoughts | economics )