If you have a complex, interconnected, unsynchronised system, its going to run in cycles. The important thing in a sustainable economy is to provide a job guarantee to those who are out of work at the moment because of inadequate aggregate demand, and to take advantage of downturns in economic activity to find and clean up messes being made.
On the other hand, I expect that most asset bubbles could be curtailed if people wanted to ... its just that you have to act during the period when it looks like the asset bubble is creating wealth from thin air, and nobody wants to stop the illusion of something from nothing until they've had a chance to get theirs. People start making noises about "fixing" an asset bubble at the point when its becoming clear that the bubble's going to pop sooner or later, and by that time there are large numbers who have bought assets where the purchase is only viable if the price trend keeps going up ... at which point the damage has already been stored up, with the tally of the damage just waiting on the popping of the bubble. I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
Oh, I agree. My personal favourite explanation of the business cycle is delayed feedback. Bush is a symptom, not the disease.
If you remove that taxation you'll get your fake boom, and blow off a few bubbles that will inflate the cycle even further.
But a crash becomes inevitable because wealth acquisition spawns a positive feedback loop that rapidly concentrates all of the liquidity in a few locations and stops it circulating elsewhere.
Effectively you get a real sclerotic economy where money simply stops circulating.
Gosh, the neoliberals must love their recessions deep and hard, they fight so hard against the shock absorbers. I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
