I was alive and working during the 81 recession, it was a minor bump in the road compared to this recession. There is no such thing as a 'typical' recession, or recessions are all alike. Fed Chairman Volcker is a hard reset the credit system BEFORE Reagan was elected to office.
Inflation, not a collapse of a ponzi scheme woven deep into the financial sector, was the start of the late 70's recession. Volcker set fed funds rate at 20%, effectively halting most borrowing in the private sector.
Deregulation of the banking industry started in 1980 just as the economy soured and banks rushed headlong into speculative loans, and lead soon to the collapse of over extended banks like Continental Illinois who was called 'to big to fail' and bailed out at a cost of 4.5 BILLION USD in 1984. By 1982 the FDIC was buying up assets, almost 800 MILLION USD worth. By '83 50 banks failed.
The Savings and Loans lost around 9 BILLION USD by '82. Government regulators were hamstrung by the White House refusing to allow them to expand personnel as the deregulation ballooned the used to be quiet and stable S&L sector.
by 1983 over 700 mergers occurred, total cost of the S&L mess was 160 BILLION USD.
Midterms saw the Democrats gaining the largest number of House seats since Watergate (26).
Reagan was forced to increase corporation taxes, a 3 year 100 BILLION USD tax hike over three years.
By election day unemployment was still 7.2%, but even though corporations had an INCREASE in their taxes their profits rose almost 30%.
All that is to say-
Too big to fail has been with us awhile
The stock market, housing, derivative market, mega computer shifts of money were not involved in the 1980-84 crisis.
Corporate taxes were INCREASED in a economic downturn but corporate profits were healthy even as the unemployment rate was lagging.
The concept of red ink to fix the financial problems was a Reagan concept backed by a Republican House.
Rampant speculation in the newly deregulated Banking and S&L crushed the private sector credit industry as the Administration refused to expand oversight to match the hugely expanded reach of banks and the S&Ls.
The 1980-84 recession was a bitch to live through for some folks, barely noticed by others and was more a test run on how to collapse an economy which was done in fine fashion 20 some years later.
But to be clear No President could have 'fixed' this collapse in 4 years, it reached through too many sectors at a time when we were already 11 or so TRILLION USD in debt from 'prosperity' years of 'conservative' policy :roll: