fwd: period of distress

Rosser Jr, John Barkley rosserjb at jmu.edu
Sat Oct 3 14:42:04 PDT 1998

--- Begin Forwarded Message --- Date: Fri, 2 Oct 1998 10:41:10 -0400 (Eastern Daylight Time) From: "Rosser Jr, John Barkley" <rosserjb at jmu.edu> Subject: period of distress Sender: owner-pkt at csf.colorado.edu To: POST-KEYNESIAN THOUGHT <pkt at csf.colorado.edu>

Reply-To: pkt at csf.colorado.edu Message-ID: <SIMEON.9810021010.B at rosserjb-7958.jmu.edu>

The late Hyman Minsky invented the term "period of distress" to describe a period after a bubble peaks but before it really crashes seriously. Such periods can last for several months. In his _Manias, Panics, and Crashes_, Charles Kindleberger documents for historical bubbles over the last several centuries the gaps between peaks and crashes, and thus documents the widespread existence of this phenomenon, a phenomenon predicted in the models of DeLong, Shleifer, Summers, and Waldmann.

The US stock market peaked on July 17 and has been sliding since basically. The Fed's cut was supposed to prop it up. It doesn't look like it's working. Indeed, it is October, the historical month of great crashes, and panic finally seems to be seriously setting in. Hold your hats, folks. Barkley Rosser

-- Rosser Jr, John Barkley rosserjb at jmu.edu

--- End Forwarded Message ---

-- Rosser Jr, John Barkley rosserjb at jmu.edu

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