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Dice Have No Memory: Big Bets and Bad Economics from Paris to the Pampas by William Bonner

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Chapter 5

Borrowing against the American Dream

Honor Insolvency

October 1, 2001

Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.

—Charles Mackay

“The struggle against terrorism,” said French Prime Minister Lionel Jospin last week, “is not just the business of judges, the police, and the secret service. There is also a response that heads of business, investors, and consumers can give!”

I took the liberty of adding an exclamation point. Such a statement needed a little flourish at the end, I thought . . . as when a man claims to have invented a perpetual motion machine or been visited by spacemen in his backyard. The preposterous needs emphasis.

“Lionel Jospin invited the French to show their ‘economic patriotism’ by continuing to consume in order to avoid a recession,” says the Associated Press report. “The head of government invited business leaders and consumers to ‘resist intimidation’ and to ‘support economic activity’.”

“Let’s show, all together, our economic patriotism,” Jospin urged.

I am not making this up. It would be impossible. I couldn’t imagine that anyone outside of an asylum could say something so absurd. But there it is.

The French prime minister also gave assurances that economic fundamentals “remain favorable” and that “Neither the United States nor Europe is in recession; there is no collapse of production.”

Jospin did not cite his sources. All available evidence ...

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