Its called the business cycle. Its a well established principle of economics.
Businesses grow, create jobs, provide new and valuable services
Businesses get big, continue to contribute
Businesses get too big, outdated, or corrupt
Businesses suffer problems, lose revenue from sales or inefficiency, or lose good employees
Businesses go bankrupt creating a recession or bubble
New businesses grow from ashes and/or old businesses re-organize
And the cycle begins. For every bankruptcy there is a business to take its place. That is why a lot of us libertarians believe that the proper order of the cycle is to let bad and corrupt businesses fail. After all, no business that is being properly run should fail. A great example is the US auto industry's 'Big 3'. There is not a better example of the business cycle, and their failures. Of course, the only part is that they're stuck at the 'suffering problems, lose revenue from bad business models/low revenue'
You can look at many businesses that complete that cycle on a very long term basis. Look at 80's Apple vs. 90's Apple vs. 00's Apple. Guess what '10's able is going to probably be?
Ultimately, you need failure to access good business practices and viable models.
In regards to your sine wave idea, you are inherently wrong.
The assumption is that through bailouts, the damage is reduced, but growth back to 'maximal' is always achieved, albiet at longer intervals. The truth is that may be wrong. The idea is that through the bailouts the businesses get fixed. That is not always the case. Thats the problem. If you bail out a business, you don't fix the problem. You only mitigate risk, which means that the business may not grow to maximal capacity.
A great example of this cycle are heavy socialist/communist countries. I'm not talking Europe, but China, USSR, Venezuala and others. They have, or have had at one time, the full idea of statism for bailouts and production quotas. The problem is that when its integrated strongly....Efficency takes a major nosedive, and you have major economic problems as we've seen in the history of states that use that economic model.
Back from the dead, I'm afraid.
