Just paraphrasing, so I can make sure I understand you both so far: a period of exuberance is followed by a pull-back and then other factors can influence to what degree it becomes a full-blown recession, vs a slight dip etc.
So in the dot-com exuberance, that led to a pull-back, which was exacerbated by 9/11. But lowering interest rates by the Federal government allowed money to flow back into the economy?
What was the prior recession due to? (I was just out of college in the early 1990s.)
If the Fed knows all this, then don’t they have an idea of what we’re in for? I mean, don’t they have teams of people running forecasts, and analyzing EVERYTHING, and then controlling whatever factor(s) they need to? I realize we’re in a capitalist market, and not everything can be controlled, but why let interest rates get SO low?
Do you think they have models of possible outcomes?
Do you think there’s a ‘consumer-housing-crash model’?