Booms
in sentence
228 examples of Booms in a sentence
In both booms, roughly 90% of respondents in the US expected an increase in home prices over the next several years, with large expected increases over the next 12 months, surpassing 15% in San Francisco in 2003.
Periods of rapid growth in lending are often associated with construction booms, partly because real-estate assets are relatively easy to post as collateral for loans.
But centralized, one-size-fits-all monetary policies cannot counteract
booms
or busts reliably, and often have unintended consequences.
Contrary to what the followers of Friedrich von Hayek and Andrew Mellon have always claimed, economic readjustments do not happen when bankruptcies force labor and capital out of low-productivity, low-demand industries, but rather when
booms
pull labor and capital into high-productivity, high-demand industries.
It also depends on full employment and near-permanent booms, just as economist John Maynard Keynes had warned in the 1920s and 1930s.
But, as some Chinese policymakers respond, all growth processes involve waste: nineteenth-century railway
booms
in Britain and America created huge overcapacity and investor losses, even as they spurred economic transformation.
Even more importantly, policies can discourage foreign-borrowing-led consumption
booms
by taxing capital inflows (Chilean-style) or increasing financial intermediaries’ liquidity requirements.
We might see prolonged and high unemployment in the construction sector, and in regions that had seen the biggest previous construction
booms.
Instead, governments are clawing to stretch out unsustainable booms, further pushing up commodity prices, and raising the risk of a once-in-a-lifetime economic and financial mess.
Historical evidence from the last 40 years shows that political cycles within the region are highly synchronized, and tend to reflect economic
booms
and busts.
Petrodollars flooding into the region financed huge public-spending increases and real-estate booms, and fueled an economic bonanza that propped up the continent’s military dictatorships.
In several countries, debt-financed housing
booms
have left households and companies over-leveraged; and governments have reduced deficits to contain their own debt.
The euro’s introduction led to housing
booms
in countries like Spain and Ireland.
Thus, the state’s coffers (and hence spending) overflow during booms, but then collapse, forcing emergency retrenchment, during busts.
Sometimes global financial markets’ eagerness to lend results in unreasonable booms, followed by abrupt reversals.
The problem is not just that they need to wean themselves from their reliance on fickle capital inflows and commodity booms, which have often left them vulnerable to shocks and prone to crises.
Regulations should also have a strong counter-cyclical focus, preventing excessive accumulation of leverage and increasing capital and provisions (reserves) during booms, as well as preventing asset price bubbles from feeding into credit expansion.
This exaggerates the effects of
booms
and busts.
This does not mean that capital controls can solve all problems: the same paper shows that they are relatively ineffective at preventing lending
booms
– another key cause of economic vulnerability.
But the paper also shows that domestic prudential policies – such as capping home-mortgage loans at a certain percentage of the property’s value, or increasing banks’ capital requirements during economic upswings – can be effective at restraining lending
booms.
It can drive the real over-investment cycles feared by Austrian-school economists like Ludwig von Mises and Friedrich Hayek, and can drive harmful
booms
and busts in prices of existing assets, as described by Hyman Minsky.
It manages to combine technology-driven cycles of
booms
and recessions with markets that always clear (i.e., there is no unemployment).
When powerful
booms
emerge in other sectors, the temptation to argue that “this time is different” will again be irresistible.
Booms
and busts in individual equity stocks or specific commodities typically have little macro-level effect: and even huge swings in entire equity-market sectors – such as the NASDAQ boom and bust of 1998-2002 – may have only a mild adverse impact on overall economic growth.
By contrast, property
booms
and busts have historically been the most dangerous, because the total value of real estate wealth usually dwarfs equity values, and because real-estate
booms
are often debt-financed.
Despite its frequent economic booms, Asia is also a strategic and security minefield.
Developing economies that manage to grow rapidly on a sustained basis without relying on natural-resource
booms
– as most of these countries have for a decade or more – typically do so through export-oriented industrialization.
Given the shift in global power and the prospect of US energy self-sufficiency as domestic hydrocarbon output booms, America is trying to adapt its foreign policy to the new multi-polar international order.
But countries such as Greece, Ireland, Portugal, and Spain face a real problem: now that their consumption and construction
booms
have ended, a long period of slow growth looks unavoidable.
Other things being equal, the right institutions can curbpro-cyclical fiscal policies – tax cuts and spending hikes during
booms
and austerity during downturns – in the short run, while helping to deliver debt sustainability in the long run.
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