Crusoe, Hallucinogenic Mushrooms, and Credit

Jonathan Newman returns to join Bob in a critique of Eliezer Yudkowsky’s viral theory of investment bubbles. Yudkowsky states that the bad investment during bubbles should be felt before the bubble pops, not after. They argue that his perspective—while clever—fails to consider the Austrian insights on capital structure, time preference, and the business cycle. They use analogies from apple trees to magic mushrooms to show why Austrian economics provides the clearest explanation for booms, busts, and the pain that follows.

• Eliezer Yudkowsky's Theory on Investment Bubbles: Mises.org/HAP520a
• Bob's Article "Correcting Yudkowsky on the Boom": Mises.org/HAP520b
• Bob's on The Importance of Capital Theory: Mises.org/HAP520c
• Joe Salerno on Austrian Business Cycle Theory: Mises.org/HAP520d
• Dr. Newman's QJAE Article on Credit Cycles: Mises.org/HAP520e

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