The origins of the current economic crisis can be traced to a particular kind of social epidemic: a speculative bubble that generated pervasive optimism and complacency. That epidemic has run its course. But we are now living with the malaise it caused.
That’s according to Robert J. Shiller, a professor of economics and finance at Yale University and co-founder and chief economist of the financial technology company MacroMarkets, who wrote a recent column for The New York Times about the troubled U.S. economy.
Although Shiller focuses on the real estate market, he offers big-picture insight into what caused the Great Recession and why it won’t go away.
“The uptick in the unemployment rate, to 9.1 percent from 8.8 percent two months earlier, and the drop in stock prices over the last month have attracted notice, yet in a sense they are symptoms of a deeper economic sickness,” he writes.