History never repeats itself but, according to the IMF, it might this time (Red alert as world ignores history lesson, 17 October). Despite countless publications and studies related to the 2008 financial crisis and its effect on the whole economic system, politicians, central banks and economic institutions seem to keep using the same logic that they used 10 years ago.
The decrease in interest rates caused by central banks’ policies provoked the boom of private debt held by companies. Together with the constant diminution of companies’ abilities to repay their debts, this presents a clear underlying problem and a terrible outlook of a new global economic crisis. By favouring short-term decisions and policies in order to maintain growth at an acceptable rate as the recent IMF report proves, central banks keep committing the same errors. Will the world economic system be able to avoid another crisis if we continue to accumulate more and more risk factors?
Milan Bollecker
Paris, France
• Larry Elliott, in his analysis (A King’s sad lament shows the lessons of 2008 were not learned, 21 October), gives a frightening picture of the confused economic thinking coming from the IMF’s annual meeting, and this does not include the ideas of its own Global Housing Watch “that there is abundant evidence that housing cycles can be a threat to financial and macroeconomic stability” so that that “the era of benign neglect of house price booms is over”.
As a long-time adherent of Henry George, via the Labour Land Campaign, I wonder how the neglect of house prices can ever be benign, since it ends up with people priced out of housing by high rents and mortgages, so using up the spending power provided to workers by capitalists to buy their products and services.
David Reed
Northampton
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