The Economist launched an excellent series of brief episodes exploring “six big economic ideas” on breakthroughs that shaped off the discipline. The series started-off with explaining George Akerlof’s seminal work on information asymmetry in his paper “The Market for Lemons.” Last week’s briefing was Hyman Minsky’s hypothesis that booms sow the seeds of busts. Minsky’s work remained fairly obscure during his life until his death in 1996; it wasn’t until 2007 that market participants, brokers, and central bankers began citing his work extensively — pointing out of Hyman Minsky’s unsettling conclusion that “economic stability breeds instability. Periods of prosperity give way to financial fragility.”

PIMCO’s Paul McCulley coined the term “‘Minsky moment’ to describe a situation when debt levels reach breaking-point and asset prices across the board start plunging.” The Economist, however, notes that Minsky’s own theories expect that the Minsky moment “will eventually peter out. Economic growth is still shaky and the scars of the global financial crisis visible. In the Minskyan trajectory, this is when firms and banks are at their most cautious, wary of repeating past mistakes and determined to fortify their balance-sheets. But in time, memories of the 2008 turmoil will dim. Firms will again race to expand, banks to fund them and regulators to loosen constraints. The warnings of Minsky will fade away. The further we move on from the last crisis, the less we want to hear from those who see another one coming.” Whether that’s true or not, Nobel laureate Paul Krugman said “we are all Minskyites now” and central banks seem to agree.

Econonerds, take note: Later in the series, The Economist will present: The Stolper-Samuelson theorem, The Keynesian multiplier, The Nash equilibrium, and The Mundell-Fleming trilemma.