Chapter 7, 8, & 9 Curiosities

Owen is right in that increases in short run production can be lower or higher than the long run levels for various reasons. For the most part, the instances you mentioned can have highs and lows, but that volatility must be potent to really rock other sectors of the economy and throw the economy into recession. The curious question is why is the seemingly an overproduction in every sector across the US just before a downturn occurs? I would point towards inflation of the money by a central bank created by government deficit spending.