bravo. the misunderstanding of economic latency combined with our natural hyperbolic discounting seems to lead to the majority of misunderstandings about economics (besides the basic fallacies and terminology).
It seems that everyone has been infected with short-term thinking and forgotten how to run a regular business. In short-term thinking you don't care about whether or not you're going to do business with anyone again, because you're unsure whether they will be around to do business with. This kind of reasoning is infectious. What we wound up with was a "race to the bottom" in terms of who could make the riskiest highest leverage moves.
It's a natural consequence of uncertainty about the future. The idea that everything could change within a few years or a decade is now so prevalent that it affects everyone's medium-term planning, and heavily reinforces the future discount.
It seems that everyone has been infected with short-term thinking and forgotten how to run a regular business. In short-term thinking you don't care about whether or not you're going to do business with anyone again, because you're unsure whether they will be around to do business with. This kind of reasoning is infectious. What we wound up with was a "race to the bottom" in terms of who could make the riskiest highest leverage moves.