Dow Theory: A Political Perspective
"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of the voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." - Ludwig von Mises The validity of this basic tenet of the Austrian School of Economics will now be tested. The von Mises position stands at odds with the far more widely accepted Keynesian Economics view of the world , as I have mentioned before . To the extent that great economic theories are being contested this is an interesting time to be alive. To the extent that von Mises might be correct it does not bode well for avoiding economic pain ahead. Long-time readers know of my interest in Dow Theory , which has nothing to do with the Austrian School per se. The oldest stock market timing method, pioneered by Charles Dow himself, has come under criticism in recent t