You ask, will the American credit crunch hurt the world economy? (“Rocky Terrain Ahead,” September 1, 2007). You betcha. As any seasoned student of business cycles will tell you, the precipitous drop of housing prices in America spells recession. Indeed, the housing market is the economy’s weakest link, as you say in passing. And, given the size of the American economy, a recession there is bound to spill elsewhere. You also ask, why most Wall Street analysts still bet on a miraculous recovery, mainly in the shape of decreasing interest rates? To begin with, business cycles now last between ten and fifteen years due to improved macroeconomic management. Many years ago, cycles lasted between three and five years, and the impact of each cycle was thus less severe. On top of that, ever-younger people get to engage in macroeconomic management. In the good old times, such jobs went almost exclusively to seasoned people. By the time recession strikes today, few people in key positions remember the last one very well. Returning to your original question, the American credit crunch was spawned by the faltering housing market, which is a dead giveaway for what is now in store. Some credit crunch, this.