Mirror gallery. Great depression, a great recession, learned and unlucky lessons of history

Two great financial crises of the last hundred years-the Great Depression of the 1930s and the Great Recession, which began in 2008-unfolded against the background of credit boom, dubious banking practices and a fragile and unstable financial system. With the beginning of the 2008 crisis, governments turned to the lessons of the great depression in an effort to prevent the worst. Although their reaction allowed to avoid financial collapse and catastrophic depression, similar to the one that took place in the 1930s, unemployment in the USA and Europe reached an incredibly high level.
Why couldn"t the authorities achieve the best results? In his new book "Mirror Gallery", the outstanding American economist Barry Eichengrin offers a detailed answer to this question today. Comparing the great depression and the great recession in Europe and North America, he shows how the fear of new depression, which spread after the collapse of Lehman Brothers, determined the state reaction on both continents. Since the banking collapse was a decisive feature of the great depression, the authorities provided emergency assistance to problem banks. But since the derivatives markets did not play any role in the 1930s, the governments lost sight of the problems of the so-called shadow banking system. Having made too little to maintain expenses in the 1930s, this time governments increased state expenses. But these measures led to the aggravation of the economic situation in countries with too large debts, especially in southern Europe. Moreover, since politicians made impossible promises and their measures could not stop a serious recession, the actions of governments and central banks caused a reverse reaction. Politicians decided to return to the usual policy before the situation in the economy normalized. The result of this was a slow restoration in the United States and an endless recession in Europe.
"Mirror Gallery" is an important work on economic history and a detailed study of how we managed to avoid repeating only some, but not all mistakes. This book shows not only how the “lessons” of the great depression continue to determine the response of society to modern economic problems, but also how the experience of a great recession will forever change our ideas about the Great Depression