Why This Banking Crisis Won’t Wreck the Economy: Tyler Cowen

One reason for (relative) optimism is simply that the world, and policymakers, have been preparing for this scenario for some time. Not only do memories of 2008-2009 remain fresh, but we are coming out of a pandemic that in macroeconomic terms induced unprecedented policy reactions in most countries. Before 2008, in contrast, macroeconomic peace had reigned and there was common talk of “ the great moderation,” meaning that the business cycle might be a thing of the past. We now know that view is absurdly wrong.

Circa 2023, we can plausibly expect further disruptions and macroeconomic problems. But this ...