In January I wrote that after the Exodus, when Moses ascended Sinai, the Israelites panicked when he didn’t return quickly. They constructed a golden calf to pray to and indulged in a literal orgy of consumerism.

God, more of a disciplinarian and a stick-and-carrot thrifty kind of guy than a Keynesian, then compelled them to wander the desert for forty years until the old guys died off and a new confident generation emerged.

It seemed to me, I wrote, working entirely off introspection, that we’re going to have to wait a comparable amount of time for our generation of bankers and consumers to fade away and a new untraumatized generation with undamaged animal spirits to emerge.

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Here is a paper documenting the empirical proof of my conjecture: : www.econ.berkeley.edu…

From the abstract: “Our estimates indicate that stock market returns and inflation early in life affect risk-taking several decades later. “

Not surprising even without research.