Via Mankiw, Jeff Sachs interesting statements really begs for a model:
President Barack Obama’s economic team is now calling for an unprecedented stimulus of large budget deficits and zero interest rates to counteract the recession. These policies may work in the short term but they threaten to produce still greater crises within a few years. Our recovery will be faster if short-term policies are put within a medium-term framework in which the budget credibly comes back to balance and interest rates come back to moderate sustainable levels....
1. Can delaying a recession result in a greater depression later on? What are the mechanics of this?
2. The corollary is the following: Can the policy of lower interest rates of the Greenspan era to avoid a recession result in an even greater depression?
3. Another corollary from low interst rates is Victor Zarnowit's notion that each boom results in over-investment and contains within it the seeds of the next recession.
Bob Shiller's idea that talking about a depression can lead to one is being discounted by Mark Thoma. Again, this begs for a model of feedback effects and the size of the feedback that is required to create a recession. An event triggers a crisis and then everyone becomes more risk averse or begins to prepare for the worst leading to a self-fulfilling prophecy. This sounds just as plausible as technological shocks.