This is more of a rant than a proper article but I had to get this off my chest.
Some people don't understand basic economics but let me break it down as simply as possible. To stimulate the economy it's necessary to pump money into the private sector. There are many competing ideas on how to do this; you can take a Keynsian approach which believes stimulation can occur from either government spending or a reduction in taxes; Austrian economists take a more libertarian approach and believe that stimulation can only occur by a reduction, preferably an elimination, of taxes and government intervention in the economy; then you have the moronic viewpoint on the economy, what I like to call the "political retardonomics," which basically believes that in order to stimulate the economy we need to raise taxes, introduce huge spending bills, and do whatever we want without thinking about repercussions.
From Nevada to New Jersey, pretty much every state is lowering taxes to deal with our economic predicament. While New Jersey is cutting taxes on individuals and businesses to make the state more competitive, California is doing the exact opposite. California politicians feel that in order to correct a budget deficit, it's better to raise taxes and make as little cuts as possible. Let's think about this logically; when there are hard economic times, people save more and have a psychologically negative outlook about the future. This mentality needs to be corrected to influence taxpayers to start spending, triggering and economic rebound. This is a basic principle for almost all economics, and while it's very simplified, it's a true and logical statement. How does California expect to reverse economic problems by raising taxes? It doesn't make any sense. What the state should be doing is making cuts, especially on wasteful spending, and decrease taxes to bring businesses back into the state. How hard is that to understand?
Not only is California acting irresponsibly, but I just read an article stating that Obama wants to raise taxes on the wealthy and businesses. "President Obama is putting the finishing touches on an ambitious first budget that seeks to cut the federal deficit in half over the next four years, primarily by raising taxes on businesses and the wealthy" (Montgomoery and Connolly, 2009, para. 1). He wants to halve the deficit by the end of his term by raising taxes on businesses and the wealthy? The man just signed a bill that will borrow $800 billion(which won't do jack to stimulate the economy). This doesn't take into account interest rates, and by the time this "stimulus plan" is paid off, it will end up costing something close to $1.6 trillion. Doesn't this seem a bit hypocritical? In reality, he doesn't care about the deficit he's going to cause because he won't be in office when we get hit with this huge expense. Ignoring the hypocritical part, we have a severe economic situation throughout our country. We need to stimulate the job market and get people to spend money. How is this going to happen if he taxes the rich(who does he consider rich?) and raises taxes on businesses? What business is going to want to hire people after the taxes come into affect? All that's going to happen is a resultant increase in the unemployment rate and a significant reduction in private spending.
What I'm trying to say is that California is basically screwed and it looks like the United States will soon be following. Some economists are predicting our economy to come out of the recession by the end of 2010; I don't see that happening. Most likely we will see a deepening of the recession, possibly entering a depression by the end of next year. I'm not trying to scare anyone, but based on our moronic governments idea of economic stimulus, our country is going in the crapper.
References:
Montgomery, L. and Connolly, C. (2009, Feb. 22). Obama's First Budget Seeks To Trim Deficit. The Washington Post. Retrieved February 22, 2009 from http://www.washingtonpost.com/wp-dyn/content/article/2009/02/21/AR2009022100911_pf.html
Retardonomics: Government's View on Economics
"This is more of a rant than a proper article but I had to get this off my chest." To stimulate the economy it's necessary to pump money into the private sector."
Some people don't understand basic economics but let me break it down as simply as possible. To stimulate the economy it's necessary to pump money into the private sector.
From Nevada to New Jersey, pretty much every state is lowering taxes to deal with our economic predicament. While New Jersey is cutting taxes on individuals and businesses to make the state more competitive, California is doing the exact opposite. California politicians feel that in order to correct a budget deficit, it's better to raise taxes and make as little cuts as possible. Let's think about this logically; when there are hard economic times, people save more and have a psychologically negative outlook about the future. This mentality needs to be corrected to influence taxpayers to start spending, triggering and economic rebound. This is a basic principle for almost all economics, and while it's very simplified, it's a true and logical statement. How does California expect to reverse economic problems by raising taxes? It doesn't make any sense. What the state should be doing is making cuts, especially on wasteful spending, and decrease taxes to bring businesses back into the state. How hard is that to understand?
Not only is California acting irresponsibly, but I just read an article stating that Obama wants to raise taxes on the wealthy and businesses. "President Obama is putting the finishing touches on an ambitious first budget that seeks to cut the federal deficit in half over the next four years, primarily by raising taxes on businesses and the wealthy" (Montgomoery and Connolly, 2009, para. 1). He wants to halve the deficit by the end of his term by raising taxes on businesses and the wealthy? The man just signed a bill that will borrow $800 billion(which won't do jack to stimulate the economy). This doesn't take into account interest rates, and by the time this "stimulus plan" is paid off, it will end up costing something close to $1.6 trillion. Doesn't this seem a bit hypocritical? In reality, he doesn't care about the deficit he's going to cause because he won't be in office when we get hit with this huge expense. Ignoring the hypocritical part, we have a severe economic situation throughout our country. We need to stimulate the job market and get people to spend money. How is this going to happen if he taxes the rich(who does he consider rich?) and raises taxes on businesses? What business is going to want to hire people after the taxes come into affect? All that's going to happen is a resultant increase in the unemployment rate and a significant reduction in private spending.
What I'm trying to say is that California is basically screwed and it looks like the United States will soon be following. Some economists are predicting our economy to come out of the recession by the end of 2010; I don't see that happening. Most likely we will see a deepening of the recession, possibly entering a depression by the end of next year. I'm not trying to scare anyone, but based on our moronic governments idea of economic stimulus, our country is going in the crapper.
References:
Montgomery, L. and Connolly, C. (2009, Feb. 22). Obama's First Budget Seeks To Trim Deficit. The Washington Post. Retrieved February 22, 2009 from http://www.washingtonpost.com/wp-dyn/content/article/2009/02/21/AR2009022100911_pf.html
"
Money is a medium of exchange, it isn't wealth. Pumping money into anything won't do anything except for devalue the currency.
" when there are hard economic times, people save more and have a psychologically negative outlook about the future."
People need so save more.
"This mentality needs to be corrected to influence taxpayers to start spending, triggering and economic rebound"
Excessive spending was the problem, more spending won't fix anything.
" He wants to halve the deficit by the end of his term by raising taxes on businesses and the wealthy?"
If he had a brain, he would cut government spending, not raise taxes on anyone.
"The man just signed a bill that will borrow $800 billion(which won't do jack to stimulate the economy)."
I highly doubt that we will borrow much of it. My guess is that the printing press will be busy. We can't pay anyone back for the trillions we already owe, we won't find any lenders.
" We need to stimulate the job market and get people to spend money."
The market needs to be left alone. Americans are too deep in debt. Their overspending has triggered mass overinvestment in many areas. But since people were spending more money than they actually had, the investments that were made cannot sustain themselves because people are starting to save. Encouraging more spending will just make the bubble keep growing. Eventually, it has to burst. People need to catch up with their bills, unemployment has to happen, projects need to end, and the market needs to reset.
Sometimes the medicine tastes bad.
"What I'm trying to say is that California is basically screwed and it looks like the United States will soon be following"
Very true.
"Some economists are predicting our economy to come out of the recession by the end of 2010;"
Those are the same economists who had no idea this was coming. they are the ones that blame the free market, blame lack of spending, and think the government can fix this by lowering interest rates. They are idiots.
" Most likely we will see a deepening of the recession, possibly entering a depression by the end of next year"
Yup. We are arguably already in a depression. It's going to happen though. Obama is following FDR's footsteps which deepened the Great Depression.
The reason why everyone is debating the stimulus bill so much, is because nobody knows what to do. If they did they would have done it by now.
"The reason why everyone is debating the stimulus bill so much, is because nobody knows what to do. If they did they would have done it by now. "Some people know what to do. No one will listen to them.
Maybe people should try asking the economists who have predicted every economic crisis we have ever had. What's predictable is explainable, and the people who predicted this can also explain it.
"SathingtonWaltz said:No. No they don't."The reason why everyone is debating the stimulus bill so much, is because nobody knows what to do. If they did they would have done it by now. "Some people know what to do. No one will listen to them.
Maybe people should try asking the economists who have predicted every economic crisis we have ever had. What's predictable is explainable, and the people who predicted this can also explain it.
"
"lilburtonboy7489 said:Sure they do. I know what's wrong and how to fix it. A lot of people do."SathingtonWaltz said:No. No they don't. ""The reason why everyone is debating the stimulus bill so much, is because nobody knows what to do. If they did they would have done it by now. "Some people know what to do. No one will listen to them.
Maybe people should try asking the economists who have predicted every economic crisis we have ever had. What's predictable is explainable, and the people who predicted this can also explain it.
"
Why are you so certain that people don't know? Because Paul Krugman and Barrack Obama don't know?
"SathingtonWaltz said:Nope, because everyone is still arguing about what to do. I'm sure anything you say about how to fix the economy, somebody else has a completely different idea of how to fix it. And if your such a master economist, why don't you just go to Washington D.C. yourself and tell them how it is. This country could use some of your immense wisdom."lilburtonboy7489 said:Sure they do. I know what's wrong and how to fix it. A lot of people do."SathingtonWaltz said:No. No they don't. ""The reason why everyone is debating the stimulus bill so much, is because nobody knows what to do. If they did they would have done it by now. "Some people know what to do. No one will listen to them.
Maybe people should try asking the economists who have predicted every economic crisis we have ever had. What's predictable is explainable, and the people who predicted this can also explain it.
"
Why are you so certain that people don't know? Because Paul Krugman and Barrack Obama don't know?
"
"lilburtonboy7489 said:"Nope, because everyone is still arguing about what to do.""SathingtonWaltz said:Nope, because everyone is still arguing about what to do. I'm sure anything you say about how to fix the economy, somebody else has a completely different idea of how to fix it. And if your such a master economist, why don't you just go to Washington D.C. yourself and tell them how it is. This country could use some of your immense wisdom. ""lilburtonboy7489 said:Sure they do. I know what's wrong and how to fix it. A lot of people do."SathingtonWaltz said:No. No they don't. ""The reason why everyone is debating the stimulus bill so much, is because nobody knows what to do. If they did they would have done it by now. "Some people know what to do. No one will listen to them.
Maybe people should try asking the economists who have predicted every economic crisis we have ever had. What's predictable is explainable, and the people who predicted this can also explain it.
"
Why are you so certain that people don't know? Because Paul Krugman and Barrack Obama don't know?
"
So what? That doesn't mean there aren't people that know what the problem is. The people deciding on these policies are lawyers an politicians, not economists. And all of the economic advisers in DC are Keynesians, which is a very wrong theory. There aren't different views in DC. Everyone there are Keynesians, the only disagreement is which kind of Keynesian policies should be implemented.
" I'm sure anything you say about how to fix the economy, somebody else has a completely different idea of how to fix it."
Too bad that the things I say have not been refuted.
" And if your such a master economist, why don't you just go to Washington D.C. yourself and tell them how it is. This country could use some of your immense wisdom. "
I know they could. That's why I'm working on my MA in economics.
"TheSixthHorseman said:1. By pumping money into the private sector, I don't mean that we should increase the money supply; we should decrease taxes on individuals and businesses in order to provide spending incentives."This is more of a rant than a proper article but I had to get this off my chest." To stimulate the economy it's necessary to pump money into the private sector."
Some people don't understand basic economics but let me break it down as simply as possible. To stimulate the economy it's necessary to pump money into the private sector.
From Nevada to New Jersey, pretty much every state is lowering taxes to deal with our economic predicament. While New Jersey is cutting taxes on individuals and businesses to make the state more competitive, California is doing the exact opposite. California politicians feel that in order to correct a budget deficit, it's better to raise taxes and make as little cuts as possible. Let's think about this logically; when there are hard economic times, people save more and have a psychologically negative outlook about the future. This mentality needs to be corrected to influence taxpayers to start spending, triggering and economic rebound. This is a basic principle for almost all economics, and while it's very simplified, it's a true and logical statement. How does California expect to reverse economic problems by raising taxes? It doesn't make any sense. What the state should be doing is making cuts, especially on wasteful spending, and decrease taxes to bring businesses back into the state. How hard is that to understand?
Not only is California acting irresponsibly, but I just read an article stating that Obama wants to raise taxes on the wealthy and businesses. "President Obama is putting the finishing touches on an ambitious first budget that seeks to cut the federal deficit in half over the next four years, primarily by raising taxes on businesses and the wealthy" (Montgomoery and Connolly, 2009, para. 1). He wants to halve the deficit by the end of his term by raising taxes on businesses and the wealthy? The man just signed a bill that will borrow $800 billion(which won't do jack to stimulate the economy). This doesn't take into account interest rates, and by the time this "stimulus plan" is paid off, it will end up costing something close to $1.6 trillion. Doesn't this seem a bit hypocritical? In reality, he doesn't care about the deficit he's going to cause because he won't be in office when we get hit with this huge expense. Ignoring the hypocritical part, we have a severe economic situation throughout our country. We need to stimulate the job market and get people to spend money. How is this going to happen if he taxes the rich(who does he consider rich?) and raises taxes on businesses? What business is going to want to hire people after the taxes come into affect? All that's going to happen is a resultant increase in the unemployment rate and a significant reduction in private spending.
What I'm trying to say is that California is basically screwed and it looks like the United States will soon be following. Some economists are predicting our economy to come out of the recession by the end of 2010; I don't see that happening. Most likely we will see a deepening of the recession, possibly entering a depression by the end of next year. I'm not trying to scare anyone, but based on our moronic governments idea of economic stimulus, our country is going in the crapper.
References:
Montgomery, L. and Connolly, C. (2009, Feb. 22). Obama's First Budget Seeks To Trim Deficit. The Washington Post. Retrieved February 22, 2009 from http://www.washingtonpost.com/wp-dyn/content/article/2009/02/21/AR2009022100911_pf.html
"
Money is a medium of exchange, it isn't wealth. Pumping money into anything won't do anything except for devalue the currency.
" when there are hard economic times, people save more and have a psychologically negative outlook about the future."
People need so save more.
"This mentality needs to be corrected to influence taxpayers to start spending, triggering and economic rebound"
Excessive spending was the problem, more spending won't fix anything.
" He wants to halve the deficit by the end of his term by raising taxes on businesses and the wealthy?"
If he had a brain, he would cut government spending, not raise taxes on anyone.
"The man just signed a bill that will borrow $800 billion(which won't do jack to stimulate the economy)."
I highly doubt that we will borrow much of it. My guess is that the printing press will be busy. We can't pay anyone back for the trillions we already owe, we won't find any lenders.
" We need to stimulate the job market and get people to spend money."
The market needs to be left alone. Americans are too deep in debt. Their overspending has triggered mass overinvestment in many areas. But since people were spending more money than they actually had, the investments that were made cannot sustain themselves because people are starting to save. Encouraging more spending will just make the bubble keep growing. Eventually, it has to burst. People need to catch up with their bills, unemployment has to happen, projects need to end, and the market needs to reset.
Sometimes the medicine tastes bad.
"What I'm trying to say is that California is basically screwed and it looks like the United States will soon be following"
Very true.
"Some economists are predicting our economy to come out of the recession by the end of 2010;"
Those are the same economists who had no idea this was coming. they are the ones that blame the free market, blame lack of spending, and think the government can fix this by lowering interest rates. They are idiots.
" Most likely we will see a deepening of the recession, possibly entering a depression by the end of next year"
Yup. We are arguably already in a depression. It's going to happen though. Obama is following FDR's footsteps which deepened the Great Depression.
"
2. People should save more during a normal economic period. To send the economy into a rebound, people need to spend.
3. I'm not talking about borrowing or excessive spending, I'm talking about spending within your means; which may take awhile due to loan burdens.
4. Agree about cutting spending which he plans to do in Iraq but is a small portion of the defecit.
5. I was under the assumption that Obama would borrow a majority of the money. Using the printing press will only cause a severe rise in inflation.
6. Like I stated previous, we shouldn't have people spend more than they have. I am merely trying to infer that we should cut taxes to ease the burden on businesses and individuals.
7. Agree on the rest.
The government should declare bankruptcy. I'd laugh my ass off.
The more I think about the economics, the more I'm stuck. The people who have the power to save the economy, the big business execs, seem to be too greedy and short-sighted to do anything. The government can't change that. If they don't change, it will be capitalism that kills America.
"The government should declare bankruptcy. I'd laugh my ass off.Greed and short-sightedness have nothing to do with it. They were fooled by the artificial interest rates. The government caused this by messing up these interest rates and causing the malinvestment we see today. All of the businessmen did not suddenly and all at the same time make poor decisions based on greed. It is the systematic failure of all sectors due to the interest rates.The more I think about the economics, the more I'm stuck. The people who have the power to save the economy, the big business execs, seem to be too greedy and short-sighted to do anything. The government can't change that. If they don't change, it will be capitalism that kills America."
"Arkthemaniac said:Interest rates were caused because people couldn't pay their bills. People had those bills because businesses tricked them into thinking they could afford something they couldn't. The people were stupid, and business tried to capitalize on that."The government should declare bankruptcy. I'd laugh my ass off.Greed and short-sightedness have nothing to do with it. They were fooled by the artificial interest rates. The government caused this by messing up these interest rates and causing the malinvestment we see today. All of the businessmen did not suddenly and all at the same time make poor decisions based on greed. It is the systematic failure of all sectors due to the interest rates.The more I think about the economics, the more I'm stuck. The people who have the power to save the economy, the big business execs, seem to be too greedy and short-sighted to do anything. The government can't change that. If they don't change, it will be capitalism that kills America."
"
Or so I heard.
"lilburtonboy7489 said:No they weren't. The Federal Reserve sets the interest rates. Interest rates are based on the reserves of banks. The more in the reserves, the lower the interest rates, and vice versa. The FED buys bonds from banks to increase their reserves. By doing so, the interest rates drop. Interest rates are supposed to depend on the amount of savings that people have."Arkthemaniac said:Interest rates were caused because people couldn't pay their bills. People had those bills because businesses tricked them into thinking they could afford something they couldn't. The people were stupid, and business tried to capitalize on that."The government should declare bankruptcy. I'd laugh my ass off.Greed and short-sightedness have nothing to do with it. They were fooled by the artificial interest rates. The government caused this by messing up these interest rates and causing the malinvestment we see today. All of the businessmen did not suddenly and all at the same time make poor decisions based on greed. It is the systematic failure of all sectors due to the interest rates.The more I think about the economics, the more I'm stuck. The people who have the power to save the economy, the big business execs, seem to be too greedy and short-sighted to do anything. The government can't change that. If they don't change, it will be capitalism that kills America."
"Or so I heard."
If people are saving a lot, the reserves are high. That means the time preference of the people are for future spending. So the interest rates become low. Businesses then borrow this money and invest in future projects. They do so, because the interest rates imply that people are saving and plan to spend in the future, so the present is a good time to invest for future production.
This would all be good, except the interest rates are NOT set by the amount of savings people have. Instead, they are set by the FED. So the savings appear to be high, which means a good time to invest. But this is fake, because people have not been saving, the rates are so low because the FED has increased the reserves through bonds. So when people start saving, the projects which were invested in cannot sustain themselves. People have not been saving for the future like the rates have implied, so the people cannot sustain the new projects.
So as the projects fail, people lose jobs, illiquid assets appear, etc...
There we have our crisis.
So, we blame the government?
Okay, lemme go find my stockpile of pipe bombs . . .
The FED was the major factor in the current economic crisis. It's the same situation that occurred before and during the Great Depression. The government should not have any hand in the setting of interest rates and we need to go back to the gold standard.
Yes, I do realize that the FED is supposedly independent but this is far from the truth. The chairman is appointed by the government and the government also has tremendous influence over the FED.
"lilburtonboy7489 said:Let me get this straight... The banks wanted to loan out a ton of money to people they knew would go bankrupt? How does that make any sense? The banks were forced to loan money out by the Clinton administration to people in under-privileged areas. Sure, it sounds all rainbow and gum drops, but obviously nobody thought about what would happen when all of these families had to foreclose on their homes and the banks would be stuck with all of this property that nobody was able to/wanted to buy."Arkthemaniac said:Interest rates were caused because people couldn't pay their bills. People had those bills because businesses tricked them into thinking they could afford something they couldn't. The people were stupid, and business tried to capitalize on that."The government should declare bankruptcy. I'd laugh my ass off.Greed and short-sightedness have nothing to do with it. They were fooled by the artificial interest rates. The government caused this by messing up these interest rates and causing the malinvestment we see today. All of the businessmen did not suddenly and all at the same time make poor decisions based on greed. It is the systematic failure of all sectors due to the interest rates.The more I think about the economics, the more I'm stuck. The people who have the power to save the economy, the big business execs, seem to be too greedy and short-sighted to do anything. The government can't change that. If they don't change, it will be capitalism that kills America."
"Or so I heard."
But the OP is right. People need to spend money, but at the same time they need to not spend money that they do not have. If they're going to take out a home loan, they need to know that they will be able to pay it off within twenty years on what they're making NOW, not what they expect they'll be making in five years. They can always move again later if they're blessed with a promotion or what not.
And the government needs to cut taxes and encourage people to get out and spend!
The fault lies 100% in banks lending out too much of their money and giving out loans that were not realistically going to ever be paid off and then selling those loans to other banks disguised along with legitimate loans. It was banks being greedy that caused this entire disaster. A small part of the fault could be blamed on ignorant homeowners trying to buy a home more than they could afford. The Republican party did nothing to correct these waiting disasters before they occurred, so it's also their fault for not taking action when the problem was before them.
The bigger problem with capitalism worldwide now is how it fails to any longer reward innovation or hard work. CEOs run their companies into the ground and then get paid 10 million dollars to leave the company. This is as bad as a completely socialist society could EVER be.
So we shouldn't punish the rich assholes who primarily got us into this mess, and don't pull this "B-b-but Clinton" horseshit; because it's crap. And the "B-b-but why would they take risks" is a stupid question, because if they give out loans to people who cannot afford it, they prolong the interest payments to the banks to the point where they can never pay back entirely.
Also it is damn important that the interests are controlled by government right now. Imagine if the banks controlled it for a second, do you honestly believe they would do the responsible thing? Or the profitable thing?
"So we shouldn't punish the rich assholes who primarily got us into this mess, and don't pull this "B-b-but Clinton" horseshit; because it's crap. And the "B-b-but why would they take risks" is a stupid question, because if they give out loans to people who cannot afford it, they prolong the interest payments to the banks to the point where they can never pay back entirely.I think we absolutely should punish those who get away with running banks or companies into the ground. They're completely ruining capitalism, until we reign in this sort of 'cheating' with strong laws and enforcement, the system can never recover. You're 100% right about the FED being necessary, but it's not being run properly. The gov't is WAY too 'hands off' and that's what's causing the problem. You can never trust banks or companies to regulate themselves, they're in it for the money. Technically the gov't shouldn't be in it for the money, but I'm afraid both parties are completely corrupt now. :/
Also it is damn important that the interests are controlled by government right now. Imagine if the banks controlled it for a second, do you honestly believe they would do the responsible thing? Or the profitable thing?
"
"So we shouldn't punish the rich assholes who primarily got us into this mess, and don't pull this "B-b-but Clinton" horseshit; because it's crap. And the "B-b-but why would they take risks" is a stupid question, because if they give out loans to people who cannot afford it, they prolong the interest payments to the banks to the point where they can never pay back entirely.And those companies that gave those loans should fail; as should those individuals who were stupid and took out a loan and couldn't afford it.
Also it is damn important that the interests are controlled by government right now. Imagine if the banks controlled it for a second, do you honestly believe they would do the responsible thing? Or the profitable thing?
"
You can't place blame solely on companies as several factors contributed to our current situation. These factors include a governmental policy that pushed banks to provide non-interest loans, something that started in the early 90's; manipulation of interest rates by the fed, which is a policy that has been going on forever; banks giving out loans to individuals that couldn't afford it; individuals looking for loans that they couldn't afford; and government regulation, tax policies, etc.
"tl;drDon't live beyond your means, be responsible with credit (if you got to borrow) and educate yourself. However people and business are greedy, they like to point the finger when shit goes south and they expect the government to fix it all like their mommy did when they were 4. Most importantly, a majority of people simply don't understand how it works and business is too ignorant to care as long as the rake works. What's the point of government if it refuses to protect the citizen from unfair and risky business practices in the name of free market?
Please summarize... "
For the United States that light at the end of the tunnel is a train called bankruptcy. In two years the Chinese government will own more of the US than Americans do. Sad... Eh?
"Snipzor said:We can't afford to let the banks/companies that made bad loans fail or we'd have a different sort of economic disaster on our hands. Furthermore, many of those toxic assets were already sold to other companies, so while company A might have made the bad loan, now companies A, B, C, D, E, F, and G all have the assets. If they all failed it'd be a complete collapse of economics worldwide."So we shouldn't punish the rich assholes who primarily got us into this mess, and don't pull this "B-b-but Clinton" horseshit; because it's crap. And the "B-b-but why would they take risks" is a stupid question, because if they give out loans to people who cannot afford it, they prolong the interest payments to the banks to the point where they can never pay back entirely.And those companies that gave loans to individuals that couldn't afford loans should fail; as should those individuals who were stupid and took out a loan and couldn't afford it.
Also it is damn important that the interests are controlled by government right now. Imagine if the banks controlled it for a second, do you honestly believe they would do the responsible thing? Or the profitable thing?
"
You can't place blame solely on companies as several factors contributed to our current situation. These factors include a governmental policy that pushed banks to provide non-interest loans, something that started in the early 90's; manipulation of interest rates by the fed, which is a policy that has been going on forever; banks giving out loans to individuals that couldn't afford it; individuals looking for loans that the couldn't afford; and government regulation, tax policies, etc.
"
I believe people need to be held personally responsible for the way they run their companies or banks. The companies aren't the problem, the people running them are. Laws need to be in place so people don't think they can get rich making a quick buck while doing a horrible job.
Democrats pushed banks giving loans and Republicans pushed home ownership. The disaster didn't happen until banks got too greedy. Republicans were in power when they could have done something about it with regulation, but they're philosophically against it (which is completely idiotic, and only now does everyone finally understand that).
Individuals can't be trusted because they're too ignorant, banks cannot be trusted because they're too greedy. The individuals running government unfortunately are paid off by the greedy and ignorant, so while gov't control is the ideal solution, with the current people running the gov't in both parties, I wouldn't trust them with it.
"TheSixthHorseman said:And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail."Snipzor said:We can't afford to let the banks/companies that made bad loans fail or we'd have a different sort of economic disaster on our hands. Furthermore, many of those toxic assets were already sold to other companies, so while company A might have made the bad loan, now companies A, B, C, D, E, F, and G all have the assets. If they all failed it'd be a complete collapse of economics worldwide."So we shouldn't punish the rich assholes who primarily got us into this mess, and don't pull this "B-b-but Clinton" horseshit; because it's crap. And the "B-b-but why would they take risks" is a stupid question, because if they give out loans to people who cannot afford it, they prolong the interest payments to the banks to the point where they can never pay back entirely.And those companies that gave loans to individuals that couldn't afford loans should fail; as should those individuals who were stupid and took out a loan and couldn't afford it.
Also it is damn important that the interests are controlled by government right now. Imagine if the banks controlled it for a second, do you honestly believe they would do the responsible thing? Or the profitable thing?
"
You can't place blame solely on companies as several factors contributed to our current situation. These factors include a governmental policy that pushed banks to provide non-interest loans, something that started in the early 90's; manipulation of interest rates by the fed, which is a policy that has been going on forever; banks giving out loans to individuals that couldn't afford it; individuals looking for loans that the couldn't afford; and government regulation, tax policies, etc.
"
I believe people need to be held personally responsible for the way they run their companies or banks. The companies aren't the problem, the people running them are. Laws need to be in place so people don't think they can get rich making a quick buck while doing a horrible job.
Democrats pushed banks giving loans and Republicans pushed home ownership. The disaster didn't happen until banks got too greedy. Republicans were in power when they could have done something about it with regulation, but they're philosophically against it (which is completely idiotic, and only now does everyone finally understand that).
Individuals can't be trusted because they're too ignorant, banks cannot be trusted because they're too greedy. The individuals running government unfortunately are paid off by the greedy and ignorant, so while gov't control is the ideal solution, with the current people running the gov't in both parties, I wouldn't trust them with it.
"
And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail.Do you realize what kind of depression the world would face if all these institutions failed? I understand the lure of this sort of free market solution, but there would be a worldwide disaster unlike anything anyone's ever seen. Just like communism, free market capitalism is great in theory, but in theory alone.
Not only do we need regulation and socialism to keep companies afloat, but we need regulation of wages earned by these higher ups making bad decisions.
"TheSixthHorseman said:Regulation has never worked and always leads to more problems. Take the United States healthcare system which was completely destroyed after the implementation of HMOs by the government.And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail.Do you realize what kind of depression the world would face if all these institutions failed? I understand the lure of this sort of free market solution, but there would be a worldwide disaster unlike anything anyone's ever seen. Just like communism, free market capitalism is great in theory, but in theory alone.
Not only do we need regulation and socialism to keep companies afloat, but we need regulation of wages earned by these higher ups making bad decisions.
"
Do you really think our economy would completely collapse? It won't happen because we do have a free market and banks would eventually be bought out by other companies. It's a much better solution than a government bailout.
Regulation of wages is ridiculous and stupid. There's no reason to do it as it will have no impact on the economy. What needs to be done is an implementation of proper repercussions meaning that businesses should know that if bad decisions are made, they won't be bailed out. Let the bad businesses die and good businesses survive; don't punish the responsible and reward the irresponsible.
"TheSixthHorseman said:What the government should do is make an example of these companies. They need to let these companies fail to scare the rest of them back into line.And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail.Do you realize what kind of depression the world would face if all these institutions failed? I understand the lure of this sort of free market solution, but there would be a worldwide disaster unlike anything anyone's ever seen. Just like communism, free market capitalism is great in theory, but in theory alone.
Not only do we need regulation and socialism to keep companies afloat, but we need regulation of wages earned by these higher ups making bad decisions.
"
"Diamond said:Ugh, no. These companies (The banks in particular) represented the mass majority of the loans in America and if they went down, guess what else would go down. You are clearly underestimating the gravity of the situation, or the situation as a whole. What would be done then in a market with small banks unable to give out larger loans? The government would have to step in (As republicans have just shat out recently in many interviews; Lindsay Graham for example) and do some banking of their own for once. And we all know where that will lead, and that includes the republicans whining "SOCIALISM" even though their own party was the first to suggest it. Then again, when aren't they WHARGARBLING?We can't afford to let the banks/companies that made bad loans fail or we'd have a different sort of economic disaster on our hands. Furthermore, many of those toxic assets were already sold to other companies, so while company A might have made the bad loan, now companies A, B, C, D, E, F, and G all have the assets. If they all failed it'd be a complete collapse of economics worldwide.And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail.
I believe people need to be held personally responsible for the way they run their companies or banks. The companies aren't the problem, the people running them are. Laws need to be in place so people don't think they can get rich making a quick buck while doing a horrible job.
Democrats pushed banks giving loans and Republicans pushed home ownership. The disaster didn't happen until banks got too greedy. Republicans were in power when they could have done something about it with regulation, but they're philosophically against it (which is completely idiotic, and only now does everyone finally understand that).
Individuals can't be trusted because they're too ignorant, banks cannot be trusted because they're too greedy. The individuals running government unfortunately are paid off by the greedy and ignorant, so while gov't control is the ideal solution, with the current people running the gov't in both parties, I wouldn't trust them with it.
"
"
Although GM and Chrystler should have failed, but they both had investments in Canada and a shitload of jobs would be lost in both countries. So there would have been an international trade crisis (As there would have been with the BUY AMERICAN ACT) which would have fucked over the economy entirely.
"Diamond said:Yep. GM and Chrystler failing in the US would be the best thing for American consumers."TheSixthHorseman said:What the government should do is make an example of these companies. They need to let these companies fail to scare the rest of them back into line.And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail.Do you realize what kind of depression the world would face if all these institutions failed? I understand the lure of this sort of free market solution, but there would be a worldwide disaster unlike anything anyone's ever seen. Just like communism, free market capitalism is great in theory, but in theory alone.
Not only do we need regulation and socialism to keep companies afloat, but we need regulation of wages earned by these higher ups making bad decisions.
"
"
"TheSixthHorseman said:You do realize that the bailout did nothing, right? Banks still aren't giving out loans."Diamond said:Ugh, no. These companies (The banks in particular) represented the mass majority of the loans in America and if they went down, guess what else would go down. You are clearly underestimating the gravity of the situation, or the situation as a whole. What would be done then in a market with small banks unable to give out larger loans? The government would have to step in (As republicans have just shat out recently in many interviews; Lindsay Graham for example) and do some banking of their own for once. And we all know where that will lead, and that includes the republicans whining "SOCIALISM" even though their own party was the first to suggest it. Then again, when aren't they WHARGARBLING?We can't afford to let the banks/companies that made bad loans fail or we'd have a different sort of economic disaster on our hands. Furthermore, many of those toxic assets were already sold to other companies, so while company A might have made the bad loan, now companies A, B, C, D, E, F, and G all have the assets. If they all failed it'd be a complete collapse of economics worldwide.And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail.
I believe people need to be held personally responsible for the way they run their companies or banks. The companies aren't the problem, the people running them are. Laws need to be in place so people don't think they can get rich making a quick buck while doing a horrible job.
Democrats pushed banks giving loans and Republicans pushed home ownership. The disaster didn't happen until banks got too greedy. Republicans were in power when they could have done something about it with regulation, but they're philosophically against it (which is completely idiotic, and only now does everyone finally understand that).
Individuals can't be trusted because they're too ignorant, banks cannot be trusted because they're too greedy. The individuals running government unfortunately are paid off by the greedy and ignorant, so while gov't control is the ideal solution, with the current people running the gov't in both parties, I wouldn't trust them with it.
"
"
Although GM and Chrystler should have failed, but they both had investments in Canada and a shitload of jobs would be lost in both countries. So there would have been an international trade crisis (As there would have been with the BUY AMERICAN ACT) which would have fucked over the economy entirely.
"
A shitload of American jobs would be lost in the short-run, but the lack of cars would have to be made up by a competitor which would most likely be Honda and Toyota. These companies would most likely take over GM and Chrystler plants for cheap, re-hire workers(at a much lower and more deserved salary), and produce better, and less expensive automobiles.
Regulation has never worked and always leads to more problems. Take the United States healthcare system which was completely destroyed after the implementation of HMOs by the government.Uhh, regulation is the way capitalism has stayed afloat worldwide for decades. You ever hear the quote "Capitalism will never fail because Socialism will always be there to bail it out"? It's lack of regulation that has caused this latest economic disaster. Look at China where not only does the government control many times as much as the US, but they also control their society (which is the bad part), their economy continues to grow at an impressive rate while ours is collapsing.
Do you really think our economy would completely collapse? It won't happen because we do have a free market and banks would eventually be bought out by other companies. It's a much better solution than a government bailout.
Regulation of wages is ridiculous and stupid. There's no reason to do it as it will have no impact on the economy. What needs to be done is an implementation of proper repercussions meaning that businesses should know that if bad decisions are made, they won't be bailed out. Let the bad businesses die and good businesses survive; don't punish the responsible and reward the irresponsible.
Our economy could have easily collapsed if the bailouts that have already passed weren't. If action hadn't already been taken (not enough action yet, but some has), then we'd be well along that road already. The free market wouldn't be able to stabilize fast enough. Who would have bought the banks like you said? Bank stocks have been crashing for quite a while now (I know because I personally have lost tens of thousands by not selling my finanical stocks when I should have). Noone would have bought the banks, people would have lost ALL of their personal savings, MANY more companies would be collapsing as we speak, unable to get out new loans. A new bank could not shore up the required assets to give out enough loans quickly enough to make up for the already collapsed banks. This is why figures worldwide met with such urgency, and even the Republicans passed the first bailout package, because they knew the system would collapse utterly.
Regulation is wages is absolutely required for long term success of capitlism. The reason to do it is to control those making poor decisions. It would have a direct impact on the economy and restore needed confidence for both shareholders and regular people.
You don't seem to understand much about the way economics work. Once again, study up on it. Understand economics out of theory.
"Snipzor said:Great, they shouldn't give out loans. Now is not the time to give out loans, and they would probably screw that up too (Just like they screwed up with the bonuses)."TheSixthHorseman said:You do realize that the bailout did nothing, right? Banks still aren't giving out loans."Diamond said:Ugh, no. These companies (The banks in particular) represented the mass majority of the loans in America and if they went down, guess what else would go down. You are clearly underestimating the gravity of the situation, or the situation as a whole. What would be done then in a market with small banks unable to give out larger loans? The government would have to step in (As republicans have just shat out recently in many interviews; Lindsay Graham for example) and do some banking of their own for once. And we all know where that will lead, and that includes the republicans whining "SOCIALISM" even though their own party was the first to suggest it. Then again, when aren't they WHARGARBLING?We can't afford to let the banks/companies that made bad loans fail or we'd have a different sort of economic disaster on our hands. Furthermore, many of those toxic assets were already sold to other companies, so while company A might have made the bad loan, now companies A, B, C, D, E, F, and G all have the assets. If they all failed it'd be a complete collapse of economics worldwide.And why do we have this situation? Because government is too pussified to let these companies fail. So when companies do something wrong they realize government will fix the problem and they never have to deal with any repercussions. The same thing is happening with the Auto industry. GM and Chrystler need to fail.
I believe people need to be held personally responsible for the way they run their companies or banks. The companies aren't the problem, the people running them are. Laws need to be in place so people don't think they can get rich making a quick buck while doing a horrible job.
Democrats pushed banks giving loans and Republicans pushed home ownership. The disaster didn't happen until banks got too greedy. Republicans were in power when they could have done something about it with regulation, but they're philosophically against it (which is completely idiotic, and only now does everyone finally understand that).
Individuals can't be trusted because they're too ignorant, banks cannot be trusted because they're too greedy. The individuals running government unfortunately are paid off by the greedy and ignorant, so while gov't control is the ideal solution, with the current people running the gov't in both parties, I wouldn't trust them with it.
"
"
Although GM and Chrystler should have failed, but they both had investments in Canada and a shitload of jobs would be lost in both countries. So there would have been an international trade crisis (As there would have been with the BUY AMERICAN ACT) which would have fucked over the economy entirely.
"
A shitload of American jobs would be lost in the short-run, but the lack of cars would have to be made up by a competitor which would most likely be Honda and Toyota. These companies would most likely take over GM and Chrystler plants for cheap, re-hire workers(at a much lower and more deserved salary), and produce better, and less expensive automobiles.
"
Yep. GM and Chrystler failing in the US would be the best thing for American consumers.And the millions of jobs lost and further worsening the trade gap and ruining the manufacturing base? It would be completely idiotic and basically end America as we know it. If these free market forces you speak of are so great, why haven't other companies sprung up to manufacture cars within the US?
"TheSixthHorseman said:The only reason China is growing is because the country has been deregulating and promoting capitalism. While it's still a very socialist country, socialism isn't the reason China has expanded.Regulation has never worked and always leads to more problems. Take the United States healthcare system which was completely destroyed after the implementation of HMOs by the government.Uhh, regulation is the way capitalism has stayed afloat worldwide for decades. You ever hear the quote "Capitalism will never fail because Socialism will always be there to bail it out"? It's lack of regulation that has caused this latest economic disaster. Look at China where not only does the government control many times as much as the US, but they also control their society (which is the bad part), their economy continues to grow at an impressive rate while ours is collapsing.
Do you really think our economy would completely collapse? It won't happen because we do have a free market and banks would eventually be bought out by other companies. It's a much better solution than a government bailout.
Regulation of wages is ridiculous and stupid. There's no reason to do it as it will have no impact on the economy. What needs to be done is an implementation of proper repercussions meaning that businesses should know that if bad decisions are made, they won't be bailed out. Let the bad businesses die and good businesses survive; don't punish the responsible and reward the irresponsible.
Our economy could have easily collapsed if the bailouts that have already passed weren't. If action hadn't already been taken (not enough action yet, but some has), then we'd be well along that road already. The free market wouldn't be able to stabilize fast enough. Who would have bought the banks like you said? Bank stocks have been crashing for quite a while now (I know because I personally have lost tens of thousands by not selling my finanical stocks when I should have). Noone would have bought the banks, people would have lost ALL of their personal savings, MANY more companies would be collapsing as we speak, unable to get out new loans. A new bank could not shore up the required assets to give out enough loans quickly enough to make up for the already collapsed banks. This is why figures worldwide met with such urgency, and even the Republicans passed the first bailout package, because they knew the system would collapse utterly.
Regulation is wages is absolutely required for long term success of capitlism. The reason to do it is to control those making poor decisions. It would have a direct impact on the economy and restore needed confidence for both shareholders and regular people.
You don't seem to understand much about the way economics work. Once again, study up on it. Understand economics out of theory.
"
Who would have bought the banks? Foreign companies, domestic companies like Wells Fargo and JP Morgan, etc.
Control wages? Ok, are we limiting solely executives or everyone? How much are we limiting wages to? Should George Soros and Warren Buffet have their wages limited? Should they not be able to make billions? I'm trying to understand your viewpoint.
Study up on it? What the hell are you talking about? I have a degree in economics and it sounds like you gained your viewpoint from one class at Berkley. What school of economics are you reciting your nonsense from?
Great, they shouldn't give out loans. Now is not the time to give out loans, and they would probably screw that up too (Just like they screwed up with the bonuses).Do you realize than giving out loans is completely necessary for not only companies starting out, but even large companies in today's economic environment? Lending is the biggest pillar of capitalism, regulated or not.
TheSixthHorseman said:
You do realize that the bailout did nothing, right? Banks still aren't giving out loans.The bailout kept the banks afloat. Now the government has to tell them to give out more loans. Do you even understand what happens if a bank is allowed to collapse?
A shitload of American jobs would be lost in the short-run, but the lack of cars would have to be made up by a competitor which would most likely be Honda and Toyota. These companies would most likely take over GM and Chrystler plants for cheap, re-hire workers(at a much lower and more deserved salary), and produce better, and less expensive automobiles.
What good does Honda or Toyota taking over the US market do for the US? If you haven't been paying attention (which I can tell you haven't), Toyota and Honda are facing bad losses as well. The failure of GM, Chrystler and Ford wouldn't help them, it'd just hurt everyone.
Furthermore, what motivation is there in today's capitalism to do a good job? These CEOs don't care if they run a company into the ground. The government isn't paying for their golden parachutes, the CEO pays for their own (basically through corrupting the company from within).
"TheSixthHorseman said:Do you understand the basics of supply and demand? When GM goes out of business do you think Americans who buy GM vehicles will stop buying vehicles altogether? Of course not, they will instead purchase from companies like Ford, Honda, and Toyota, which will result in an increase in sales for those companies, requiring a significant increase in hiring and raw/manufactured materials.Yep. GM and Chrystler failing in the US would be the best thing for American consumers.And the millions of jobs lost and further worsening the trade gap and ruining the manufacturing base? It would be completely idiotic and basically end America as we know it. If these free market forces you speak of are so great, why haven't other companies sprung up to manufacture cars within the US?
"
The only reason China is growing is because the country has been deregulating and promoting capitalism. While it's still a very socialist country, socialism isn't the reason China has expanded.Ugh, no (I love opening on that). China is growing because of their lack of caring over any form of quality, and their extreme cheapness for every product. They have not one piece of regulation to it, and it seems as if regulatory additions for every company (Food and Toy Companies specifically) in order to improve quality. So already you are mixed up.
Who would have bought the banks? Foreign companies, domestic companies like Wells Fargo and JP Morgan, etc.
Control wages? Ok, are we limiting solely executives or everyone? How much are we limiting wages to? Should George Soros and Warren Buffet have their wages limited? Should they not be able to make billions? I'm trying to understand your viewpoint.
Study up on it? What the hell are you talking about? I have a degree in economics and it sounds like you gained your viewpoint from one class at Berkley. What school of economics are you reciting your nonsense from?
"
Also note that foreign companies are also in trouble, this isn't domestic. To think so is the essence of neglect.
"Snipzor said:Honda and Toyota have been suffering losses because of a decrease in demand. While there would be a significant amount of job losses in the short-run, in the long-run there would be almost no net loss of jobs because demand for GM cars would shift to other car companies.Great, they shouldn't give out loans. Now is not the time to give out loans, and they would probably screw that up too (Just like they screwed up with the bonuses).Do you realize than giving out loans is completely necessary for not only companies starting out, but even large companies in today's economic environment? Lending is the biggest pillar of capitalism, regulated or not.
TheSixthHorseman said:You do realize that the bailout did nothing, right? Banks still aren't giving out loans.The bailout kept the banks afloat. Now the government has to tell them to give out more loans. Do you even understand what happens if a bank is allowed to collapse?
A shitload of American jobs would be lost in the short-run, but the lack of cars would have to be made up by a competitor which would most likely be Honda and Toyota. These companies would most likely take over GM and Chrystler plants for cheap, re-hire workers(at a much lower and more deserved salary), and produce better, and less expensive automobiles.
What good does Honda or Toyota taking over the US market do for the US? If you haven't been paying attention (which I can tell you haven't), Toyota and Honda are facing bad losses as well. The failure of GM, Chrystler and Ford wouldn't help them, it'd just hurt everyone.
Furthermore, what motivation is there in today's capitalism to do a good job? These CEOs don't care if they run a company into the ground. The government isn't paying for their golden parachutes, the CEO pays for their own (basically through corrupting the company from within).
"
Edit: The majority of CEO's aren't corrupt or power hungry. These people worked hard and were smart enough to make it to the top of their respective companies. I have no problem awarding them for their effort.
The only reason China is growing is because the country has been deregulating and promoting capitalism. While it's still a very socialist country, socialism isn't the reason China has expanded.They used to be completely communist, the point is their economy still expands while ours shrinks. Heavily regulation does NOT hamper success.
Who would have bought the banks? Foreign companies, domestic companies like Wells Fargo and JP Morgan, etc.
Control wages? Ok, are we limiting solely executives or everyone? How much are we limiting wages to? Should George Soros and Warren Buffet have their wages limited? Should they not be able to make billions? I'm trying to understand your viewpoint.
Study up on it? What the hell are you talking about? I have a degree in economics and it sounds like you gained your viewpoint from one class at Berkley. What school of economics are you reciting your nonsense from?
"
How do foreign companies taking over help the US, the American worker, and the American way of life? Anyways, did you notice what happened because foreign companies did buy the bundled toxic assets? It made this into a global economic disaster. Why would ANYONE buy an unprofitable company hundreds of billions of dollars in debt and worth a fraction of the debt? Noone. Many of these institutions are a complete or near complete loss.
Well the Obama administration seems to want to limit wages to those currently receiving aid from the government. They're limiting the control to extremely large bailouts, but it should probably be every single institution that receives government (and thus taxpayer) money. Optimally I would like to take it further, but at least this eliminates the argument of the government propping up failed institutions in so far as they're not profiting from their failure.
I think heads of companies should be responsible for more than their economic policies however. I think there should be some level of social control. If a CEO implments a policy that causes dozens of deaths (like the latest peanut fiasco), it shouldn't be the company that faces charges and lawsuits, it should be the very people that caused the problems. That's part of the problem with the definitions of 'coorporations' in the world these days, responsibility is removed.
I'd say for your 'degree in economics' you're extremely ignorant about which you speak. I don't see the point in going further because your viewpoint seems to lack real life experience. You understand basic theories but don't know how that applies to the real world, as in your talk about millions of jobs being lost being 'OK' for recovery of an economic system.
Do you understand the basics of supply and demand? When GM goes out of business do you think Americans who buy GM vehicles will stop buying vehicles altogether? Of course not, they will instead purchase from companies like Ford, Honda, and Toyota, which will result in an increase in sales for those companies, requiring a significant increase in hiring and raw/manufactured materials.Demand of cars is down because of the loss of jobs. It's not a zero sum games. Less cars will be bought if GM and other American car companies fail. Less people will have jobs and less people will buy cars. The TOTAL number of cars bought will be DOWN, resulting in a significant DECREASE in hiring and raw materials. If Toyota or Honda build new plants here or take over existing ones, the workers will get paid less so still, car purchases will continue to be DOWN.
"TheSixthHorseman said:You don't see the parallel between deregulation and economic growth in China? Are you ignoring it completely because it doesn't mirror your viewpoint?The only reason China is growing is because the country has been deregulating and promoting capitalism. While it's still a very socialist country, socialism isn't the reason China has expanded.They used to be completely communist, the point is their economy still expands while ours shrinks. Heavily regulation does NOT hamper success.
Who would have bought the banks? Foreign companies, domestic companies like Wells Fargo and JP Morgan, etc.
Control wages? Ok, are we limiting solely executives or everyone? How much are we limiting wages to? Should George Soros and Warren Buffet have their wages limited? Should they not be able to make billions? I'm trying to understand your viewpoint.
Study up on it? What the hell are you talking about? I have a degree in economics and it sounds like you gained your viewpoint from one class at Berkley. What school of economics are you reciting your nonsense from?
"
How do foreign companies taking over help the US, the American worker, and the American way of life? Anyways, did you notice what happened because foreign companies did buy the bundled toxic assets? It made this into a global economic disaster. Why would ANYONE buy an unprofitable company hundreds of billions of dollars in debt and worth a fraction of the debt? Noone. Many of these institutions are a complete or near complete loss.
Well the Obama administration seems to want to limit wages to those currently receiving aid from the government. They're limiting the control to extremely large bailouts, but it should probably be every single institution that receives government (and thus taxpayer) money. Optimally I would like to take it further, but at least this eliminates the argument of the government propping up failed institutions in so far as they're not profiting from their failure.
I think heads of companies should be responsible for more than their economic policies however. I think there should be some level of social control. If a CEO implments a policy that causes dozens of deaths (like the latest peanut fiasco), it shouldn't be the company that faces charges and lawsuits, it should be the very people that caused the problems. That's part of the problem with the definitions of 'coorporations' in the world these days, responsibility is removed.
I'd say for your 'degree in economics' you're extremely ignorant about which you speak. I don't see the point in going further because your viewpoint seems to lack real life experience. You understand basic theories but don't know how that applies to the real world, as in your talk about millions of jobs being lost being 'OK' for recovery of an economic system.
"
Because those companies will still operate in the United States and will eliminate the need for government to step in and mess things up.
I'm against this too.
I will agree that CEOs should be held responsible if they implemented a policy that they know will cause deaths.
What are you talking about? You're opinions are based on a socialist view, a view which has never worked. Deregulation and less government intervention has always led to a more successful economy. Government intervention causes more problems than it does fix them. Who do you think caused the Great Depression?
You don't see the parallel between deregulation and economic growth in China? Are you ignoring it completely because it doesn't mirror your viewpoint?I will ignore the glaring spelling error here for a second. Just to mention that calling someone else a socialist is basically saying "I want to end this as fast as I can because I can't take this no more". Just a friendly reminder.
Because those companies will still operate in the United States and will eliminate the need for government to step in and mess things up.
I'm against this too.
I will agree that CEOs should be held responsible if they implemented a policy that they know will cause deaths.
What are you talking about? You're opinions are based on a socialist view, a view which has never worked. Deregulation and less government intervention has always led to a more successful economy. Government intervention causes more problems than it does fix them. Who do you think caused the Great Depression?
"
"TheSixthHorseman said:Of course purchases will be down, but not significantly. I didn't realize that GM and Chrystler employees and companies who worked with/for them purchased a majority of the cars manufactured. I don't even think they purchase 2% of the total cars manufactured.Do you understand the basics of supply and demand? When GM goes out of business do you think Americans who buy GM vehicles will stop buying vehicles altogether? Of course not, they will instead purchase from companies like Ford, Honda, and Toyota, which will result in an increase in sales for those companies, requiring a significant increase in hiring and raw/manufactured materials.Demand of cars is down because of the loss of jobs. It's not a zero sum games. Less cars will be bought if GM and other American car companies fail. Less people will have jobs and less people will buy cars. The TOTAL number of cars bought will be DOWN, resulting in a significant DECREASE in hiring and raw materials. If Toyota or Honda build new plants here or take over existing ones, the workers will get paid less so still, car purchases will continue to be DOWN.
"
What I'm trying to say is that, yes, in the short-term jobs and cars purchased will be affected. Quickly however, other car companies will have to expand to meet increased demand and will lead to re-hiring of a large portion of GM employees. Will it suck if GM fails? Of course it will, but the United States economy will not collapse because of it.
"TheSixthHorseman said:It's a grammatical error.You don't see the parallel between deregulation and economic growth in China? Are you ignoring it completely because it doesn't mirror your viewpoint?I will ignore the glaring spelling error here for a second. Just to mention that calling someone else a socialist is basically saying "I want to end this as fast as I can because I can't take this no more". Just a friendly reminder.
Because those companies will still operate in the United States and will eliminate the need for government to step in and mess things up.
I'm against this too.
I will agree that CEOs should be held responsible if they implemented a policy that they know will cause deaths.
What are you talking about? You're opinions are based on a socialist view, a view which has never worked. Deregulation and less government intervention has always led to a more successful economy. Government intervention causes more problems than it does fix them. Who do you think caused the Great Depression?
"
"
He/she has been championing the implementation of a socialist economic system for several posts. What I stated is not incorrect nor is it illogical to assume that he/she is a socialist.
You don't see the parallel between deregulation and economic growth in China? Are you ignoring it completely because it doesn't mirror your viewpoint?The success of China can be simplified down to one main point. Their workers are paid very little. That's it, the core of all their success. China (mostly their gov't and the few business owners that don't run the risk of the gov't seizing their assets) are profiting only because of their billion near slave level workers.
Because those companies will still operate in the United States and will eliminate the need for government to step in and mess things up.
I'm against this too.
I will agree that CEOs should be held responsible if they implemented a policy that they know will cause deaths.
What are you talking about? You're opinions are based on a socialist view, a view which has never worked. Deregulation and less government intervention has always led to a more successful economy. Government intervention causes more problems than it does fix them. Who do you think caused the Great Depression?
When these companies set up shop here, do you think our way of life will continue. Arguably in many ways it isn't sustainable anyways, but Americans will end up buying less goods because either they'll have no jobs or they'll earn less.
My opinions are based upon the real world, while yours seem to simply be theory taught to you by some professor. I really don't see why you're saying "Deregulation and less government intervention has always led to a more successful economy." is true because that's always been the OPPOSITE of true. Did you ever even learn the story of Big Oil? Did you ever hear about conditions for workers at the turn of the previous century?
I agree government intervention can cause tremendous disaster, but it's absolutely required.
What causes the Great Depression :
A stock market crash (a bubble bursting caused by deregulated companies posting whatever profits they wished that weren't tied to reality)
Bank failures (which you would have let happen again)
Reduction in purchasing power by workers (lots of people had money invested in the stock market in those days (called the roaring 20s for a reason)). People lost jobs (again, I point out you would find millions more jobs lost 'acceptable', this deepens any recession / depression)
Higher tariffs (this time actual tariffs haven't been used, but the lowering of interest rates have caused the same effect by raising the value of non-US currencies (which is also pushing Japan into a much worse disaster as we speak))
Other environmental issues faced at the time which are a mere shadow of those we may soon face due to global warming.
Basically, your policies would have made this economic disaster even exponentially worse than it already is.
"Snipzor said:So basic regulation that has been removed for the last 20-odd years is now considered socialist? Are you sure about that economic degree of yours?"TheSixthHorseman said:It's a grammatical error.You don't see the parallel between deregulation and economic growth in China? Are you ignoring it completely because it doesn't mirror your viewpoint?I will ignore the glaring spelling error here for a second. Just to mention that calling someone else a socialist is basically saying "I want to end this as fast as I can because I can't take this no more". Just a friendly reminder.
Because those companies will still operate in the United States and will eliminate the need for government to step in and mess things up.
I'm against this too.
I will agree that CEOs should be held responsible if they implemented a policy that they know will cause deaths.
What are you talking about? You're opinions are based on a socialist view, a view which has never worked. Deregulation and less government intervention has always led to a more successful economy. Government intervention causes more problems than it does fix them. Who do you think caused the Great Depression?
"
"
He/she has been championing the implementation of a socialist economic system for several posts. What I stated is not incorrect nor is it illogical to assume that he/she is a socialist.
"
"TheSixthHorseman said:The core success behind Chinas growth is the ability for businesses to operate with less interference from the government.You don't see the parallel between deregulation and economic growth in China? Are you ignoring it completely because it doesn't mirror your viewpoint?The success of China can be simplified down to one main point. Their workers are paid very little. That's it, the core of all their success. China (mostly their gov't and the few business owners that don't run the risk of the gov't seizing their assets) are profiting only because of their billion near slave level workers.
Because those companies will still operate in the United States and will eliminate the need for government to step in and mess things up.
I'm against this too.
I will agree that CEOs should be held responsible if they implemented a policy that they know will cause deaths.
What are you talking about? You're opinions are based on a socialist view, a view which has never worked. Deregulation and less government intervention has always led to a more successful economy. Government intervention causes more problems than it does fix them. Who do you think caused the Great Depression?
When these companies set up shop here, do you think our way of life will continue. Arguably in many ways it isn't sustainable anyways, but Americans will end up buying less goods because either they'll have no jobs or they'll earn less.
My opinions are based upon the real world, while yours seem to simply be theory taught to you by some professor. I really don't see why you're saying "Deregulation and less government intervention has always led to a more successful economy." is true because that's always been the OPPOSITE of true. Did you ever even learn the story of Big Oil? Did you ever hear about conditions for workers at the turn of the previous century?
I agree government intervention can cause tremendous disaster, but it's absolutely required.
What causes the Great Depression :
A stock market crash (a bubble bursting caused by deregulated companies posting whatever profits they wished that weren't tied to reality)
Bank failures (which you would have let happen again)
Reduction in purchasing power by workers (lots of people had money invested in the stock market in those days (called the roaring 20s for a reason)). People lost jobs (again, I point out you would find millions more jobs lost 'acceptable', this deepens any recession / depression)
Higher tariffs (this time actual tariffs haven't been used, but the lowering of interest rates have caused the same effect by raising the value of non-US currencies (which is also pushing Japan into a much worse disaster as we speak))
Other environmental issues faced at the time which are a mere shadow of those we may soon face due to global warming.
Basically, your policies would have made this economic disaster even exponentially worse than it already is.
"
Reduced earnings can be met with a reduction in taxes.
I know about Big Oil and workers conditions. What's your point? That government regulation cured these issues? A truly free market would allow individuals to choose their desired workplace, eliminating the need for such measures. What are you referring to about Big Oil? The current situation or the situation from the early 1900's?
No, what caused the great depression was the expansion of the money supply which created a credit-driven society. FDR only furthered the Great Depression by implementing ridiculous regulatory and government policies.
"Diamond said:Where did you get your degree from? Not doubting, just wondering."TheSixthHorseman said:The only reason China is growing is because the country has been deregulating and promoting capitalism. While it's still a very socialist country, socialism isn't the reason China has expanded.Regulation has never worked and always leads to more problems. Take the United States healthcare system which was completely destroyed after the implementation of HMOs by the government.Uhh, regulation is the way capitalism has stayed afloat worldwide for decades. You ever hear the quote "Capitalism will never fail because Socialism will always be there to bail it out"? It's lack of regulation that has caused this latest economic disaster. Look at China where not only does the government control many times as much as the US, but they also control their society (which is the bad part), their economy continues to grow at an impressive rate while ours is collapsing.
Do you really think our economy would completely collapse? It won't happen because we do have a free market and banks would eventually be bought out by other companies. It's a much better solution than a government bailout.
Regulation of wages is ridiculous and stupid. There's no reason to do it as it will have no impact on the economy. What needs to be done is an implementation of proper repercussions meaning that businesses should know that if bad decisions are made, they won't be bailed out. Let the bad businesses die and good businesses survive; don't punish the responsible and reward the irresponsible.
Our economy could have easily collapsed if the bailouts that have already passed weren't. If action hadn't already been taken (not enough action yet, but some has), then we'd be well along that road already. The free market wouldn't be able to stabilize fast enough. Who would have bought the banks like you said? Bank stocks have been crashing for quite a while now (I know because I personally have lost tens of thousands by not selling my finanical stocks when I should have). Noone would have bought the banks, people would have lost ALL of their personal savings, MANY more companies would be collapsing as we speak, unable to get out new loans. A new bank could not shore up the required assets to give out enough loans quickly enough to make up for the already collapsed banks. This is why figures worldwide met with such urgency, and even the Republicans passed the first bailout package, because they knew the system would collapse utterly.
Regulation is wages is absolutely required for long term success of capitlism. The reason to do it is to control those making poor decisions. It would have a direct impact on the economy and restore needed confidence for both shareholders and regular people.
You don't seem to understand much about the way economics work. Once again, study up on it. Understand economics out of theory.
"
Who would have bought the banks? Foreign companies, domestic companies like Wells Fargo and JP Morgan, etc.
Control wages? Ok, are we limiting solely executives or everyone? How much are we limiting wages to? Should George Soros and Warren Buffet have their wages limited? Should they not be able to make billions? I'm trying to understand your viewpoint.
Study up on it? What the hell are you talking about? I have a degree in economics and it sounds like you gained your viewpoint from one class at Berkley. What school of economics are you reciting your nonsense from?
"
"Diamond said:Holy shit. That's the smartest post I've seen on GB in a long time. Someone that actually knows what they are talking about. Impressive."TheSixthHorseman said:No, what caused the great depression was the expansion of the money supply which created a credit-driven society. FDR only furthered the Great Depression by implementing ridiculous regulatory and government policies.You don't see the parallel between deregulation and economic growth in China? Are you ignoring it completely because it doesn't mirror your viewpoint?The success of China can be simplified down to one main point. Their workers are paid very little. That's it, the core of all their success. China (mostly their gov't and the few business owners that don't run the risk of the gov't seizing their assets) are profiting only because of their billion near slave level workers.
Because those companies will still operate in the United States and will eliminate the need for government to step in and mess things up.
I'm against this too.
I will agree that CEOs should be held responsible if they implemented a policy that they know will cause deaths.
What are you talking about? You're opinions are based on a socialist view, a view which has never worked. Deregulation and less government intervention has always led to a more successful economy. Government intervention causes more problems than it does fix them. Who do you think caused the Great Depression?
When these companies set up shop here, do you think our way of life will continue. Arguably in many ways it isn't sustainable anyways, but Americans will end up buying less goods because either they'll have no jobs or they'll earn less.
My opinions are based upon the real world, while yours seem to simply be theory taught to you by some professor. I really don't see why you're saying "Deregulation and less government intervention has always led to a more successful economy." is true because that's always been the OPPOSITE of true. Did you ever even learn the story of Big Oil? Did you ever hear about conditions for workers at the turn of the previous century?
I agree government intervention can cause tremendous disaster, but it's absolutely required.
What causes the Great Depression :
A stock market crash (a bubble bursting caused by deregulated companies posting whatever profits they wished that weren't tied to reality)
Bank failures (which you would have let happen again)
Reduction in purchasing power by workers (lots of people had money invested in the stock market in those days (called the roaring 20s for a reason)). People lost jobs (again, I point out you would find millions more jobs lost 'acceptable', this deepens any recession / depression)
Higher tariffs (this time actual tariffs haven't been used, but the lowering of interest rates have caused the same effect by raising the value of non-US currencies (which is also pushing Japan into a much worse disaster as we speak))
Other environmental issues faced at the time which are a mere shadow of those we may soon face due to global warming.
Basically, your policies would have made this economic disaster even exponentially worse than it already is.
"
"
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