On the latest episode of Minor Issues, Mark Thornton argues that “black swans” aren’t root causes but announcement effects of imbalances created by the Fed’s cheap-credit booms. He highlights Ball State economist James McLure’s idea of sequestered capital—R&D, financial innovations, and opaque private assets shielded from public information—which proliferate under artificially low rates. From the Dutch Tulip Bubble and 1929 investment trusts to today’s candidates—hedge-fund private deals, AI data centers, commercial real estate, and crypto—the pattern is the same: policy-driven credit expansion seeds the very “unknowns” that later trigger crises. The fix isn’t more regulation; it’s removing the fuel line of easy money. See also "Sequestered Capital: An Overlooked Lacuna in the Capital Structure” by James McClure: https://mises.org/MI_137_A The Mises Institute is giving away 100,000 copies of Hayek for the 21st Century. Get your free copy at https://mises.org/IssuesFree Be sure to follow Minor Issues at https://Mises.org/MinorIssues
