Reacting to Byrne Hobart, Noah Smith notices that conservative diagnoses of the recession wouldn't pass a basic Economics class:
In all of the recent recessions, faltering output has been accompanied by lower, or even negative, inflation. This means that demand shocks must have been the culprit. If "uncertainty about government policy" were really the cause of the recession, as many conservatives claim, then we would have seen prices rise – as companies grew less willing to make the stuff that people wanted, stuff would become more scarce, and people would bid up the prices (dipping into their savings to do so). I.e, we would have seen inflation. But we didn't see inflation.
So it seems that the stories that conservatives tell about the recession – "policy uncertainty," "recalculation," or even a "negative shock to financial technology" – are not true. The stories that everyone else tells about the recession – "a flight to quality," "increased demand for safe assets," etc. – look much more like what basic introductory macroeconomics would predict.
The Dish 