Economies are not self-regulating.
Clearly they are self-regulating on a micro level. Demand for shoes increases, pushing up prices, making shoe manufacturers more profitable; this attracts entrepreneurs to the shoe sector, who manufacture more shoes, pushing prices and profitability back down; equilibrium is restored.
Similarly, if the lion population increases, they kill more antelope; the antelope population declines, and is no longer able to sustain so many lions; the lion population decreases, the antelope population recovers, and equilibrium is restored.
Hayek wrote about how the market is a machine for processing information (about what is demanded and how to produce it most cheaply.) We are lucky that it works! Perhaps there are universes where it does not.
It is no accident that Hayek's theory of business cycles emphasised the role of state intervention in causing them, and that he advocated non-interventionism as a way of solving them. Briefly, Hayek theorized that state intervention to lower the market interest rate led to malinvestments and an apparent increase in GDP, but a fall in GDP when interest rates rose and those investments were no longer profitable.
I don't quite agree with this theory. If the state can keep interest rates permanently low, Hayek's prediction will not come true. The economy will be permanently distorted away from consumption and towards investment, but this is not necessarily a bad thing.
The theory I agree with is Moldbug's, who instead of the "business cycle", calls it the "banking cycle", and blames it on maturity transformation. A credit bubble lowers interest rates, which rise when the bubble pops. (Maturity transformation is probably impossible to eliminate.)
We can ignore Keynes and his acolytes: IS/LM, the multiplier effect and all their other bullshit. It is clear that their solutions -- lowering interest rates, printing money, government borrowing and spending -- do not work.
However, all this is irrelevant when looking at the bigger picture. The lion/antelope ratio is not necessarily stable. It might oscillate around an average. Those oscillations might increase or decrease from time to time; they are not necessarily damped. One year the lion population grows too big and the antelope go extinct. Our economists do not know of any interventions to prevent species going extinct.
Similarly, civilisations go through dark ages. Civilisations collapse completely. These declines are indistinguishable from very large recessions. We do not know what causes them, and we do not know how to stop them. The banking cycle may be a cause of recessions, but it is not the only cause.