The United States suffered its first economic crisis in 1819, after more than two centuries of settlement in North America without one — despite the existence of unregulated capitalism!
What was going on? As this article explains, the Panic of 1819 was due to government inflation of the money supply, the doing of the Bank of the United States. Murray Rothbard (who wrote his dissertation on the Panic of 1819) argued that ALL of our panics, recessions, depressions have been rooted in inflation. Our present crisis is no different. Inflation inevitably leads to bad investments that depend on artificially cheap money and credit.
Statists like Obama want us to think that recessions are due to capitalism, but they are actually due to the government’s interference with it.
