EASY credit, some say, was one problem. It was amplified by newfangled, flighty financial techniques, notably buying assets with borrowed money and watching leverage work its arithmetical magic. And underneath it all was a breezy, unthinking optimism, that prices could only ever go up. This was a perfect recipe for a runaway boom—and for a ruinous bust.

Substitute “houses” for “assets” in the paragraph above, and you might be reading a rough description of the blowing-up and bursting of America’s property bubble. Insert “shares”, and you might be back in the late 1920s. Whereas the fancy financial ideas of the 2000s comprised securitisation, credit-default swaps, collateralised-debt obligations and all their weird cousins, the innovation of choice before the crash of 1929 was the investment trust, a company whose purpose was to speculate in other companies’ shares, using the wonders of leverage to multiply the returns (and, in the end, the losses).

In strange territory almost any map will do, no matter how incomplete or out of date. In trying to pick a way through today’s financial crisis, there are plenty to pore over. Among them is one drawn in Sweden in the early 1990s, another from Japan in the same decade and an American one from a few years before that. By far the scariest, though, is that sketched in the years beginning in 1929. Frequent reference is made to it (see chart).

But the map of the Depression provides only an incomplete guide to how the American economy got to where it is now. The parallels between the speculative mania that ended in October 1929 and the housing bubble are seductive but misleading. Today’s banking and credit-market crisis, and all the damage it may do to the real economy, can be traced to the property boom and subprime bust. In fact, although scholars still rake over the causes of the Depression, few think the 1929 crash contributed much. An economic slowdown was already under way before the stockmarket collapsed. And although loose monetary policy helped pump up the recent property bubble, there is much more debate about its contribution to the 1920s boom.

Where study of the Depression is more helpful, though, is in steering clear of deeper trouble. In the early 1930s deficit finance was a heresy: in 1931, as bank runs were wrecking America’s financial system, President Hoover wanted to balance the federal budget, which in those pre-New Deal days was small beer anyway. (He failed.) Monetary policy was also too tight—the main reason, argued Milton Friedman and Anna Schwartz in a brick of a book 45 years ago, why downturn became Depression.

It is no bad thing, then, that as an academic Ben Bernanke studied the Depression in earnest—looking in particular at how an impaired banking system had made the slump longer and deeper. At a conference in 2002, to honour Friedman on his 90th birthday, the chairman of the Federal Reserve (then a governor) addressed him and his co-author. “Regarding the Great Depression,” Mr Bernanke said. “You’re right. We did it. We’re very sorry. But thanks to you, we won’t do it again.”

A less obvious lesson is that early in the Depression it was not clear how bad things were going to get—or, given the paucity of economic data, even how bad they were. A year after the crash, many Americans thought that they were in the midst of a usual, if painful, downturn—not as bad, surely, as 1921, when the economy contracted by a quarter in a single year. Indeed, rural areas, home to 44% of Americans in 1930, had long been in bad shape: farming had been in a slump since the early 1920s.

But worse was to come. A wave of bank failures broke late in 1930. Another lot followed in 1931: a run on Creditanstalt, an Austrian bank, set off a chain of events that took Britain off the gold standard and raised fears that America might follow. Foreigners and domestic depositors alike demanded gold from American banks. Nor was that the last downward turn. Compare then and now: a year after the credit crisis began last August, America’s economy seemed to be standing up well. Today it looks much less secure.

The map’s political features also bear examination. Gaps are dangerous—especially between presidencies. Between Franklin Roosevelt’s first election victory in November 1932 and his inauguration in March 1933 America’s economy spiralled even further down. In February another rash of bank failures broke out. The crisis ended—and the bottom of the slump was reached—only with a federal bank holiday, declared by Roosevelt within days of taking office. Hank Paulson, treasury secretary in 2008, thinks the financial system cannot wait until 2009 for a rescue plan.

The Depression also acts as a warning of the pitfalls of congressional politics. The Bush administration found out all about those this week. There were echoes, perhaps, of 1930. That year yielded the Smoot-Hawley tariff act, the product of a special session of Congress called by Hoover to address the economic troubles. The tariff helped give the world economy a downward shove. A thousand economists wrote to oppose it. (Hoover disliked it too, but chose not to veto it.)

Is 2008 a repeat of 1929 or 1930? Look not at the road ahead but the immediate surroundings, and the question seems absurd. America’s economy may be just entering recession; between 1929 and 1933 it shrank by more than a quarter. Some economists fear that unemployment, now a touch over 6%, might reach 10%; in 1933 it was about 25%, and many of those in work were on short time and short pay. Americans are not banging at the doors of banks demanding their money, nor queuing around the block for soup and bread. America is not yet a land of Hoovervilles—or Bushvilles—inhabited by those turfed out of jobs and homes. Nor should it be allowed to become one.