Austrian economics deals with the buildup of imbalances in the economy over the course of time as an economic upturn matures - with those imbalances eventually bringing on the next downturn.
There are small downturns along the way - and then a big one at the end of the cycle to reset the system. The Kondratieff wave describes that process.
Keynesians are just focused on avoiding downturns and trying to minimize them when they happen - and American economists have been doing that for a few decades already. In fact, the law against recessions is a Keynesian concept, it is essentially Keynesianism institutionalized into the governmental system.
By the end of the 1990's, the imbalances had built up to the point where the stock market went exponential (that is not a normal development at all!). But the authorities managed to save the system again in the early 2000's, even in the wake of a stock market exponential (I explain why on this website). So that meant the imbalances were going to continue to build up.
But the imbalances had already built up considerably by the end of the 1990's - and so once I knew that the authorities had saved the system in the early 2000's again, I knew that the imbalances would continue to build up until the downturn in 2007-2010 and that as a result, by the time the next big stock market downturn was due sometime in 2007-2010, the imbalances would have built up so much (and they did, in fact, do so) that it was pretty much inevitable that they would become so great that they would overwhelm the Fed, thus resulting in the first really big economic downturn in a long time. That is what happened.
But I also knew, in light of the law against recessions, that the Fed would fight the economic downturn like crazy (which they did) - and so that would not be the end of it. (In fact, I knew just based on how much imbalances had built up in the meantime that that would not be the end of it - there is a tremendous amount of imbalances to work off in the meantime.)
So I knew that once the big downturn of 2007-2010 (which actually got started in 2007 - the stock market started going down in the fall of 2007, but it did not crash until a year later, in October 2008, and that is when most people became aware of it) bottomed out, there would be a partial recovery (there always is), which started in early March 2009, which would go on for a while, probably at least more than about six months (i.e., longer than the recovery from late 1929 until April 1930), and would then top out and the market and the economy would then go into the next big downturn, which would be far worse than the one in 2007-2010.
We have had the partial recovery - and it has had all the characteristics of a bear market bounce and none of the characteristics of a new bull market, as I expected (I cover the details of that on this website), so I do, indeed, declare the upturn to be just a bear market bounce, and that means that the upturn will lead directly to a much worse downturn than the one from 2007-2010. In fact, it looks as of recent days (in May 2010) as if that bear market bounce is over in the meantime and that we are into the beginning of the next big downturn (note as of May 2011 - the Fed managed to add another leg to the recovery; note as of May 2012 - the Fed managed to add yet another another leg to the recovery, but the stock market has been getting internally weaker the entire time and has been coming down hard this May).
And what about the law against recessions? I knew that sometime during 2007-2010, the circumstances would become so dramatic that it would be effectively impossible to continue to enforce the law against recessions - and once that happened (i.e., once the Fed lost control), it would be effectively impossible to fully enforce the law against recessions from then on. That is what has happened.
Look at what has happened - the recovery out of the downturn of 2007-2010 is so slow that even the Fed is complaining about it! That is no surprise to me - and they are going to be even more powerless to stop the next big downturn that will come upon us.
People are starting to spend more again - but the recovery out of the downturn of 2007-2010 is very mature in the meantime and is either already over with, in the stock market as of May 1, 2012, or soon will be, since even entire large countries are in trouble now. You can be assured that once the stock market turns back down in an obvious way, people will get really scared again (probably much more scared than they were last time) and stop spending again. That will probably be the end of a good economy for a long, long time.
See information about the differences between a bull market and a bear market bounce in the third section of links on this website. If one knows those differences, then it is very clear that the recovery from March 2009 is a bear market bounce, not a new bull market, which means we are heading straight into a much larger downturn. We are not (as most people are hoping) in a slow recovery toward things getting back to the way they were before.
I will be tracking events and developments in the updates to my website even after the big new stock market downturn happens - as long as the internet stays in business, which I think it will, so that I can actually post the updates to my website. I think the internet will stay in business because technologies that become public on a mass scale during a given upturn typically survive the following downturn - and use of the internet is inexpensive enough that I think, despite the sheer size of of the downturn that I see coming, a downturn that will be the biggest that the United States has ever seen in its entire history, enough people will still be able to afford the internet to keep the internet in business.