aka waiting for September 18th, 2007
Let me explain!
A term that recurs repeatedly in the day’s market analysis is the “Minsky moment” which is the time when, according to (link to full analysis) George Magnus of UBS Warburg:
The final ‘moment’ is where the prospect (or fact) of a deflationary credit contraction forces the monetary authorities to relax monetary conditions and lower interest rates in order to ensure the integrity and functioning of ‘good’ lenders and borrowers and avert, if possible, the likelihood of contagion into income, spending and hiring and firing decisions in the real economy.
Hyman Minsky was an economist who studied with Joseph Schumpeter of “creative destruction” fame, who posed several theorums about credit cycles and the behavior of debt markets in cycles, which of course are one of the causes of business cycles.
