Jan 3
This cartoon calls for a poll.
Which bubble will burst first?
AI
Crypto
They'll burst at the same time and create the "Greater Recession"
Voting ended onJan 6
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This cartoon calls for a poll.
Which bubble will burst first?
AI
Crypto
They'll burst at the same time and create the "Greater Recession"
If one sentence were to sum up the mechanism driving the Great Stagnation, it is this: Recent and current innovation is more geared to private goods than to public goods. That simple observation ties together the three major macroeconomic events of our time: growing income inequality, stagnant median income, and the financial crisis.
Tyler Cowen, Economist.
The myth is that if housing prices go up, Americans will be richer. What banks - and behind them, the Federal Reserve - really want is for new buyers to be able to borrow enough money to buy the houses from mortgage defaulters, and thus save the banks from suffering from more mortgage defaults.
Michael Hudson, Economist (Born 1939).
Data centers forcing eminent domain on someone’s bucolic home in Wisconsin.
My letter to reps:
I’ve seen a news report where private power companies are threatening homeowners with eminent domain grabs if they don’t play along with the data center development. This whole industry is questionable and we need a 5 year data center development moratorium, to give time for proper corruption investigations or at least for this house of cards to play out before the land in our region is marred with deforestation and before people’s homes in our communities are irrevocably wrecked by sham development schemes. Experts are saying some of these AI companies will go under by mid 2027. Why are politicians allowing this flailing industry to harm our communities based on dubious promises? It’s a waste of time and energy, on top of being a threat to society’s infrastructure. 5 year data center moratorium.
Please feel free to copy or repurpose for your own letters to reps.
AI Bubble: ‘This is dumber than WeWork’ | Ed Zitron The Tech Report Feb 20, 2026 I’ve heard out of Stargate Abilene that Oracle will not be extending buildings past building 8 because OpenAI is not making them enough money. Financial Expert Says OpenAI Is on the Verge of Running Out of Money He expects OpenAI to go bust “over the next 18 months.” By Victor Tangermann Published Jan 14, 2026 3:06 PM EST Futurism
because of course.
St. Charles Missouri community rejects the AI data center plan.
This place had public officials signing NDAs too. We should all be questioning if our own local public officials are signing NDAs. I’m sending postcards to my reps to bring up the subject.
St. Charles, Missouri Says NO to Big Tech’s Secretive AI Data Center - More Perfect Union - August 21, 2025
5 biggest economic bubbles in history
Economic bubbles occur when the price of an asset, such as stocks or real estate, is driven up artificially and becomes disconnected from its underlying value.
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IS THAT A BUBBLING NOISE?
This writer has made an economic point from time to time; that is, economic recessions seem to emanate from one of two conditions. The first seems endemic to capitalist economies, they go through cycles – business cycles – that span from prosperity to recession and back again. They do this because economic actors – that’s just about everyone – mostly decide independently.
That means that when times are good, they want to take advantage, spend more which increases demand which encourages increased production, which leads to higher employment, etc. That means they behave in ways that further heat up economic activity. The economy, as a result, overheats with inflationary prices and production is done at above full employment levels.
One element feeds the other and eventually, usually government action, in the form of even higher interest rates, discourages investment and brings conditions back. This often initiates a contractionary economy. When that happens, again actors mostly behaving from their personal opportunities, spend less, leading to the above activities in reverse.
They withdraw investments and hunker down to withstand lower economic rewards – profits and the like – and lower prices. Withdrawals lead to further withdrawals and a contraction occurs. This up and down is normal, and no amount of government supervision has found a way to avoid this cyclical eventuality.
But there is another type of recession. That is occurs when in a prosperity phase of the cycle, a number, and one is enough, assets’ prices shoot up beyond any semblance of their underlying value. Since their prices are rising quickly and promise investors inordinate levels of profits, this attracts investors to further buy up those assets or their representations in terms of stocks, bonds, or mortgages. This “fever,” it should be remembered, happens when due to prosperity, the general mood happens to be optimistic. People start believing the old contractionary “bug” has been licked once and for all.
Of course, this further raises those assets’ prices and hyper inflationary progressions get going in terms of those assets. This is similar to what happens in a regular cycle, but it usually revolves around a limited number – one or two – products and their price jumps seem to be on steroids. These, in popular parlance, are called “bubbles.” And bubbles eventually burst.
With that brief background – admittedly from a non-economist – what happened in 2008? It was that year when the nation had to face the consequences of a bubble bursting. This is a civic concern because nothing, over the long haul, affects politics more than economic factors. The famous campaign blip – “it’s the economy, stupid” – can be applied to most if not all elections. Having a job undergirds a voter’s ability to be viable. Take that away and things get serious in the minds of most. A poor economy threatens the vitality of the homestead.
To underline the above, one of many reactions to 2008 was offered by Richard A. Posner. He is a former jurist and economist who usually favors conservative political messaging. In the midst of the downturn, he offered the following:
The culprit is cheap credit rather than irrational behavior by business and consumers. Cheap credit stimulates economic activity, causing asset prices to rise, including the prices of residential real estate, which is a huge part of the nation’s asset base. To take advantage of these rising prices, would-be buyers borrow more, so lenders lend more, and prices are driven still higher, and lenders borrow more so that they can lend more. Leverage tends to rise, and the rapid expansion of the banking industry causes strains. At some point the asset-price increase becomes unsustainable, but no one will know in advance what that point is, and there is rational reluctance to forgo lucrative profit opportunities by bailing out before one senses that the plateau (followed by the inevitable crash) is about to be reached. This pattern has been repeated time and again and in country after country.[1]
Bubble bursting leads to serious recessions or, as Posner sees the 2008 version, a depression.
His concern seems a bit timely today in that the President has been pressuring the Federal Reserve (the FED) to lower interest rates at a time of full employment. While there does not seem to be a real estate bubble going on – although real estate prices in the nation’s major cities seem extraordinarily high leading to increase homelessness in those urban areas – are there signs of another asset bubbling up?
Well, there is corporation debt. The main source or cause of high debt today is low interest rates. Businesses that want to invest or meet expenses instead of using their cash reserves, are incentivized to borrow. Why? The cost of doing so is so low. Consequently, the debt levels of these entities have inflated by levels last measured in the pre-2008 crash. Back then, that debt reached by historical standards to relatively very high levels. What about now?
Debt outstanding for nonfinancial businesses stood at a little over US$15 trillion by the of Q3 2018, with corporations accounting for 63.9 percent. Between Q4 2010 and Q3 2018 – the period immediately after the bout of deleveraging [lowering debt] prompted by the Great Recession – nonfinancial businesses in the country have added about US$5 trillion to their overall debt, with nonfinancial corporations contributing US$3.5 trillion to this figure. Indeed, since Q1 2011 (and until Q3 2018), debt outstanding among nonfinancial corporations grew by an average of 5.6 percent per quarter year over year. At 46.4 percent of GDP in Q3 2018, nonfinancial corporations are carrying more debt today by this measure than they were just prior to the Great Recession.[2]
Worrisome?
Beyond the proximity of these debt levels to the last crash – which is enough of a concern – when the next inevitable downturn takes place, the FED will have significantly less maneuvering ability to meet it – it lowers them during downturns to encourage business activity. Why? Because they currently have interest rates so low and will find it difficult to lower them more. Perhaps in that situation, the FED can join other national banks and allow negative interest rates – where lenders or savers pay the banks to hold their money.
And, more relevant to the point of this posting, corporations with high debt are in a more vulnerable posture due to that debt. With a downturn, it will be difficult to take on more debt. In addition, there will be bankruptcies and a lot of debt will be erased at the expense of lenders – they will not be made whole and will lose a significant part of their investment or lending amount. But can something else develop from these debt levels? Can they be considered a bubble?
Of course, all of this is not helped by record-breaking debt levels held by the federal government – apparently the huge tax breaks the government put in place in 2017 did not lead to the increases in production promised by those who made the decision to institute the lower taxes for high income individuals and corporations.
These are the types of developments that put depression into economic depressions or recessions. When the economy slides, they discourage people to invest. The result, deeper recessions that last longer. But before a recession begins, an economic player is only speculating whether the downturn will happen and when it will happen. The question is not whether there will be a recession in the nation’s future, but when that recession will occur and what will cause it. “Good luck to us all.”
A short postscript: for civics or American government teachers, the above sketchy description of the business cycle will probably suffice. Such a teacher can count on an economic course to fill-in the details for students.
[1] Richard A. Posner, A Failure of Capitalism: The Crisis of '08 and the Descent into Depression (Cambridge, MA: Harvard University Press, 2009), 105.
[2] Akrur Barua and Patricia Buckley, Dr., “Rising Corporate Debt: Should We Worry?”, Deoloitte, April 15, 2019, September 23, 2019, https://www2.deloitte.com/us/en/insights/economy/issues-by-the-numbers/rising-corporate-debt-levels.html, (emphasis in the original).