Credit markets thawing...
- Thread starter halik
- Start date
BrunoPuntzJones
Lifer
- Feb 24, 2001
- 14,513
- 4
- 81
yllus
Elite Member & Lifer
- Aug 20, 2000
- 20,577
- 432
- 126
Is this due to the European "no banks will collapse during this panic" pledge / interbank loan guarantee? While I can definitely see that making banks more willing to lend to each other again, I don't know how healthy saying something like that is for the overall industry.
SP33Demon
Lifer
- Jun 22, 2001
- 27,928
- 142
- 106
HendrixFan
Diamond Member
- Oct 18, 2001
- 4,646
- 0
- 71
Exactly. We just put this on our credit card, as we have done with all of the bailout/stimulus spending this year. We just put off having to pay for it.
When the time comes that we have to pay for this all (National debt is approaching GDP), we will have to suffer.
StageLeft
No Lifer
- Sep 29, 2000
- 70,150
- 5
- 0
Not sure it's over yet, pretty sure it's not, actually.
If we dodge this bullet it will take the wind from the sales of the hyperinflationary world-is-over crowd, though. I think a possible key reason for the defense is that much of the rest of the world is in the same boat, so relatively speaking it's not like the US will destroy itself while they sit pretty and unaffected, which could have increased a problem.
If we dodge this bullet it will take the wind from the sales of the hyperinflationary world-is-over crowd, though. I think a possible key reason for the defense is that much of the rest of the world is in the same boat, so relatively speaking it's not like the US will destroy itself while they sit pretty and unaffected, which could have increased a problem.
bamacre
Lifer
- Jul 1, 2004
- 21,029
- 2
- 61
I guess you can consider the GAO a new group of 'Paulbots'...
http://www.gao.gov/new.items/d08783r.pdf
http://www.gao.gov/new.items/d08783r.pdf
The problem with this board is I think we all follow the news too closely. Sure this is a big problem, sure there will be a large and painful bill to pay for all this someday. The problem is that people see events and blow them way out of proportion. We have a very large problem with this credit meltdown, but to have people see it and declare '2ndgreatdepressionhyperinflation1930sGermanyohmygodMadMaxfuture!' isn't really reasonable until a lot more bad stuff happens.
Same thing happens with the election.
Same thing happens with the election.
bamacre
Lifer
- Jul 1, 2004
- 21,029
- 2
- 61
And the short-sighted fools ignore the fact that with the coming SS and Medicare "tsunami of spending," our government should be saving money, preparing for the problem. Instead, our government has done the opposite. And the coming financial outlook is now even worse.
And when our spending is much greater than our revenues, and foreign countries refuse to take on the debt, where will the money come from?
- Oct 10, 2000
- 25,696
- 1
- 0
Terrible analogy - the reality is 700B now or x times more for public works programs, output lost etc. Deficit spending is bad because of the inflation, but that's not really a problem deflationary climate (read: credit crisis).
So in terms of the nominal amount of debt, it would be an increase or a bigger increase. Not a good thing, but it's one or the other. As far as our peers go, U.S. is still not doing that bad, despite electing a group of idiots twice...
Debt as a % of GDP:
Germany 64.90
United States 60.80
France 63.90
Canada 64.20
Italy 104.0
Japan 170.00
United Kingdom 43.60
Russia 5.90
Note the pattern that the most industrialized nations have a fair bit of debt? Think finance - how does your return on equity change with or without leverage?
bamacre
Lifer
- Jul 1, 2004
- 21,029
- 2
- 61
bamacre
Lifer
- Jul 1, 2004
- 21,029
- 2
- 61
The real irony of the OP is that it is the very system that Ron Paul so adamantly opposes that created this problem in the first place.
So we pass a $700 billion bailout, and libor is down. Big fucking deal. At what cost? Massive increase in debt. Socialization of the banking industry. Need I go on?
So we pass a $700 billion bailout, and libor is down. Big fucking deal. At what cost? Massive increase in debt. Socialization of the banking industry. Need I go on?
- Oct 10, 2000
- 25,696
- 1
- 0
You linked to a guy that writes articles about natural health and has a ron paul pitch in the last paragraph. GTFOH
No one is arguing that endless spending is good; but misguided libertopians simply have no clue when it comes to macro policy. If you can ignore inflation (given the current climate), the debt can grow at the rate of GDP growth and we'll still be comfortably between the G8 countries.
It's kind of like guy that makes 100K / year with 20K debt is about as risky as guy that makes 200K / year with 40K debt, ceteris paribus. Also why the debt clock is kind of stupid, because the nominal amount of debt doesn't tell you anything. (ie I'm 30K in debt... is that bad, good, ok if you know nothing else about me?)
StageLeft
No Lifer
- Sep 29, 2000
- 70,150
- 5
- 0
I don't want to say it, but if you can temporarily suspend your disbelief over the fantasy nature of certain parts of our economy you have to admit that it's served the country pretty damn well. If it is a house of cards, perhaps we can keep it up. Yes, the US has more wealth than it should by many accounts, but after decades and decades, if the jig is still not up, should we really mess with it severely?
HendrixFan
Diamond Member
- Oct 18, 2001
- 4,646
- 0
- 71
Wouldn't more up to date numbers put us up around 80% and trending quickly towards 100%? I understand that by taking the failure in banking and transferring it to national debt you avoid the huge crash that was about to hit. I think the point is that the loss has just been transferred but has not yet been realized. The fallacy is thinking that the loss won't happen and we can go about business in a manner that put us in this place to begin with.
We all know you can deficit spend and inflate to hide losses. The reckoning will come and we need to do something BEFORE it does.
You're confusing GDP with tax revenues in your analogy...
From the congressional budget office
http://www.cbo.gov/ftpdocs/81x.../05-18-TaxRevenues.pdf
According to this report, in 2006 we made 2.4 trillion in tax revenues. Today, we have over 10 trilliion in debt.
Thus, the US is like a guy who makes 100k / year with 400k in debt. That's a pretty bad situation to be in, but certainly not the end of the world. Regardless, I think it's a situation that we shouldn't be in.
bamacre
Lifer
- Jul 1, 2004
- 21,029
- 2
- 61
Feel free to come to your own conclusions...
http://www.gao.gov/new.items/d08783r.pdf
Why compare the USA to other countries? I don't want to the USA to see other countries as an example of what to be like. I want other countries to look to us as an example of what they should be like.
And while you can sit here and bash the Austrians for the system they support, you're only ignoring and supporting the failing system in place now. And not just here, but abroad as well. And you're ignoring the prices paid for keeping it afloat. Not just financially, but in ideology.
That's not a good analogy. Think about it.
TRENDING THREADS
-
Discussion Zen 5 Speculation (EPYC Turin and Strix Point/Granite Ridge - Ryzen 9000)- Started by DisEnchantment
- Replies: 25K
-
Discussion Intel Meteor, Arrow, Lunar & Panther Lakes Discussion Threads
- Started by Tigerick
- Replies: 21K
-
Discussion Intel current and future Lakes & Rapids thread- Started by TheF34RChannel
- Replies: 23K
-
-
Facebook
Twitter