the fallacy of composition

' ..the 'fallacy of composition' comes into play and inflames mob psychology. This theorem says that, in a crisis, the action that is rational for each indidual is irrational for the group as a whole and creates a disastrous outcome. The classic example is that when there is the cry "Fire!" in a crowded theater, it is rational for each individual to save himself to rush toward the exit. However, when everyone does it simultaneously, there is a panic, and a crush results. In a financial panic, each individual is acting rationally when he sells his stocks, or would be were it not for the fact that others are doing the same thing. Each participant, by rationally trying to save himself, contributes to the ruin of all'

- from 'Hedgehogging' by Barton Biggs

The same can be said when we are encouraged by our governments to spend our way out of recession, when the rational thing to do is to save.

The same can be said about what is happening to SBN right now.