Jacinta, your analysis is spot-on but for two points.

There is a direct comparison between the 1930s depression and the sub-prime crisis, because both of them were caused by the same thing: government manipulation of the money supply.

Governments inflate the currency to give themselves more capacity to spend, or to lower interest rates. Both of these work by diluting the value of existing dollars with new dollars. Everyone who uses money is robbed by the amount of the increase, which flows into the hands of whoever government gives it to, starting with politicians’ superannuation accounts, and then whoever else they want to privilege with money taken from someone else.

It is a fraudulent deception, but government continues to do it because a) it has the power to do it, b) most people don’t understand how they are being ripped off, c) government gets the credit for magically creating wealth out of thin air, and d) politicians can get their and their mates’ snouts in the trough.

The architect of the sub-prime debacle is government. Without their inflation of the money supply this whole problem – and all the subsidiary corruption that you decry - would not come into existence.

If government control of the money supply were abolished, and everyone had the same right to supply money, society would spontaneously substitute gold and silver as money. This would have the great advantage that government could not easily increase the supply of money, and so could not easily defraud the public and cause these major socio-economic disruptions and injusticies as it does now. The money supply would tend to be very stable. Instead of seeing prices constantly rising as we do now, prices in general would tend to fall over time, because capitalism tends to make goods cheaper in real terms as time goes on. Instead of these recurrent booms characterized by speculation, debt and spending, and busts characterized by bankruptcies, obscene bailouts and unemployment, there would be an uneven but steady rise in the living standards of everyone, including – and especially - the poor