The first line in Chapter 1 of Carl Menger’s 1871 Principles of Economics states that everything is subject “to the law of cause and effect.” Once again, we have the example of a prominent mainstream economist confusing cause with effect. The latest dangerous nonsense comes from Martin Feldstein, who claims that unless the government stops housing prices from falling, the economy will be in great peril. While it would take all of the cyberspace in the world to fully criticize his latest piece of idiocy, I will provide one passage to demonstrate what I mean: We need a firewall to … Continue reading Feldstein’s Economic Ignorance — and Mainstream Folly