The Last War, or the One Before?

Re-fighting past battles isn't only for generals. Economists are finding different historical precedents for our current economic woes, which lead to very different policy implications.

Collapsing asset prices and credit market turmoil recall the depression (and its recent Japanese echo):

• Morgan Stanley's Steven Roach draws a comparison to Japan's post-bubble slump of the 1990's.
• Robert Reich finds a worryingly relevant passage in the memoirs of depression-era Fed chairman Marriner Eccles.
  

Record oil prices and simultaneous inflation and unemployment bring back memories of 1970's stagflation:

• Fed watcher Tim Duy says we are "Inching Closer to the Reality of Stagflation"
• Allan Meltzer thinks the Fed is repeating the mistakes of the 1970's (and Econospeak's Econoclast has a critical response)
  

The Bernanke Fed's tune sounds more like "Happy Days Are Here Again" than "I Will Survive" - it has been willing to respond aggressively with rate cuts to stimulate the economy and aid the financial sector, even at the risk of inflation.

In the Things That Make You Go Hmmm... Dept.: The lyrics to "Happy Days Are Here Again" were written by J. Yellen, and the President of the San Francisco Fed is also J. Yellen.