ABSTRACT
The crash has spread rapidly around the world because of the high degree of integration of the world economies. The worldwide liquidity boom was nearly universal, and so predictably in each country one would expect a correction, a crash of some sort, when the heady euphoria of unsustainable credit creation wore off. The essential ingredient in the process that leads up to the crash is the weird distortion of trade relations itself. The difference between a crash and a depression is that both of them start with a crash that wipes out wealth and at the same time wipes out confidence in prior judgments of risk. The stimulus package has other parts, parts that involve spending a lot of money on things that don't make us better off in the future. The "problem" with the stock market—the single largest of the capital markets—today is that it is a haven for speculative traders and a graveyard for true investors.
