Financial Instability: ‘Bubbles’ are really getting out of hand!

SAO PAOLO | By Mike Konczal via Marcus Nunes’ Historinhas | Should we endure a mini-recessio, i.e. more bubbles, with lower employment and output, to fight a thing called “financial instability”? I had no idea that Sweden has gone all-in on raising interest rates to fight “financial instability.” (Alas poor Lars Svensson!) Simon Wren-Lewis has details, Krugman has more, and Peter Orszag had a great column about how New Zealand is instead using regulations to fight worries about the financial system.