The economy is capable of shrugging off almost anything. People don't sit around wallowing in their sorrows unless there are strong incentives to do so. The co

The economy is capable of shrugging off almost anything. People don't sit around wallowing in their sorrows unless there are strong incentives to do so. The conversation often treats a crisis like some sort of storm that blows in unexpectedly. They aren't. An economic crisis is people being forced to realise that an obviously wasteful activity can't go on any longer and the resources have to be reallocated to something useful. If there is the will to let obvious failures go broke and cease activities any shock is short, sharp and highly transitory. The problem is 2008-style responses where productive money starts being rerouted to propping up incompetent and wasteful institutions.