Barry Ritholtz sighs:

Confidence is a symptom, not the cause of what ails us. It is ironic that so many economists make what is essentially a classic causation/correlation error. Healthy economies have confident consumers and businesses; if we short up confidence, goes this misguided thinking, things will improve. But healthy economies also have expanding economic activity, gaining jobs, wage improvements, active home sales, free credit activity. Confidence flows from the improvements in these basic economic activities; it is not an isolated state of mind independent from the rest of the universe.

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