Ep. 252 Bob’s Reaction to the Bernanke/Diamond-Dybvig Nobel Award
Bob Murphy Show
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Why Bank Failures Are Important in the Market Economy
Pura: Bernanke was trying to show there's something about bank failures per se that causes declines in real GDP or spikes in unemployment. And yet the effects on the economic output were pretty bad, he says. Pura: The conclusion is this is why they say it's important to not let your banks fail during a crisis because you want to keep the credit markets working.
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