Paul Krugman, writing in August of 2002: "To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund bu

Paul Krugman, writing in August of 2002: "To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble." It's been a while since Krugman said this, but it illustrates a basic fact about how many western governments do economics today: it's bubbles all the way down. I like the article, but I think its charge of intellectual incoherence could be applied to a broader category of financial products than just beanie babies, tulips, and bitcoin. Many things, like houses, have simple explanatory narratives for why they have some value, but progressively more complex (and more incoherent) narratives for why they have their actual value. In an essentially nihilistic economic model, where growth consists of stacking bubbles upon bubbles and hoping to inflate new ones before old ones pop, bitcoin is only marginally more demented than everything else.