I have written this book because I have serious concerns about how economic policy is being practiced. Too much experimental ‘discretion’, too little use of stable, well understood rules. Unhelpful actions include near zero interest rates in the USA plus ‘quantitative easing’ (= printing money). Massive, largely wasteful, fiscal spending in advanced western nations in 2008 in a panicked response to the crisis, followed two years later by angst and hand-wringing about the size of government debt in major nations. Plus willingness to bail out all the major financial institutions in trouble but one, Lehman Brothers. This inconsistency almost created a massive crisis in global finance.
There are important lessons for governments, for central banks and for all of us as investors concerned to build and protect wealth. Karl Max said that capitalism is crisis, and that capitalism would be destroyed by crisis created by its internal conflicts. He failed to see that crisis brings opportunity, except in his own political career. This is my key conclusion about the Great Crises of Capitalism.