Scott talks to Jeff Deist about the economic ramifications of the coronavirus, including both the virus itself and the government’s fiscal and monetary response. Deist certainly expects that we could be in for a severe recession, but is mainly of the view that this recession was coming soon anyway. It just took the right event to pop the bubble. Much of the ground that the country appeared to make up since the last crash, he says, has really been a reinflation by the Federal Reserve of the same old asset bubbles—and some new ones. The American economy has been overly financialized for decades, with ultra-low interest rates incentivizing companies to borrow money to fund ill-advised ventures rather than accumulating real savings and capital. A healthy economy that did save, he explains, would be able to endure a month or two of inactivity without the precipitate collapse we’re starting to see today.

Discussed on the show:

Anatomy of the Crash

Jeff Deist is president of the Mises Institute, where he serves as a writer, public speaker, and advocate for property, markets, and civil society. He previously worked as a longtime advisor and chief of staff to Congressman Ron Paul, for whom he wrote hundreds of articles and speeches. Follow him on Twitter @jeffdeist.

This episode of the Scott Horton Show is sponsored by: NoDev NoOps NoIT, by Hussein Badakhchani; The War State, by Mike Swanson; WallStreetWindow.com; Tom Woods’ Liberty Classroom; ExpandDesigns.com/Scott; Listen and Think Audio; TheBumperSticker.com; and LibertyStickers.com.

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The following is an automatically generated transcript.

Show TranscriptScott Horton 0:10

All right, y'all welcome it's Scott Horton Show. I am the director of the Libertarian Institute editorial director of antiwar.com, author of the book Fool's Errand: Time to End the War in Afghanistan. And I've recorded more than 5000 interviews going back to 2003, all of which are available at ScottHorton.org. You can also sign up to the podcast feed. The full archive is also available at youtube.com/ScottHortonShow. All right, you guys introducing Jeff diced. He's the president of the Ludwig von Mises Institute. That's misis.org, the Austrian economists over there. And they just published this new book, anatomy of the crash the financial crisis of 2020 Real quick on the gun. They're edited by Joe Bishop, introduction by Jeff Deist. Welcome back to the show. Jeff, how you doing?

Jeff Deist 1:09

I'm doing great, Scott. Thanks for having me.

Scott Horton 1:12

Amazing. You put out a book about the current financial crisis, just what six weeks into it here?

Jeff Deist 1:19

Yeah, I hate the term current financial crisis because I think it's it's just a flare up of an ongoing financial crisis. And I think a lot of this was baked into the cake already. And that's why I'm particularly leery of people who are trying very hard to get away with blaming all this on the virus and the shutdowns I mean, I personally think the shutdowns are an extreme overreaction. But that's not really the thrust of this book here. The thrust of this book is to say, hey, look, here's some of the conditions that were already set, really going back, at least to the crisis, and in many ways farther back than that. So I think the Coronavirus was a precipitating factor, but I don't think it was the cause of this crash.

Scott Horton 2:06

Well, even Trump himself called it the Obama bubble, the stock market bubble and all this back before he inherited it, and then took full political ownership of the economy. And it was pretty clear. I mean, I have access to you and Mark Dornan and Bob Murphy and people like this. So the question has been for the last, at least, you know,