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Enough of this "national debt caused the credit crunch" BS

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rchiu

Diamond Member
Jun 8, 2002
3,846
0
0
Originally posted by: HendrixFan
Inflation and national debt make the current crisis worse, but they are not directly the problem. The reason we have inflation (from printing money and from too low of interest rates) and a huge national debt have the same root cause as this bailout. Unchecked greed, greed that will stop at nothing, including long term harm, to win in the short term.

The 1% interest rates caused a huge jump in investors flowing away from treasury bills and towards MBSs in 2001. By 2003 all the "solid" MBSs had been sold but the market was still hungry for more. That is when lending standards started to drop and a long chain of companies started to act irresponsibly. You have the huge house of cards that hold a trillion or two in housing but is leveraged and credit default swapped up to $530 trillion. It is the $530 trillion that is in danger of falling and taking out our economy, the couple trillion in housing is small potatoes. However, it is the housing that is holding up everything.

Meanwhile, by having to bailout the companies, buy up mortgages, put out stimulus checks and spend our way out of the problem; that is where we run into the national debt and inflation being an issue. On a micro level, when you have a sudden emergency that you have to pay for, and you dont have the cash to cover it you usually charge it or put it into debt somehow. If you are already neck deep in debt and the interest alone on your debt is 15% of your income, then adding a new large debt is an issue.
Well, without sounding too much like Gordon Gekko, I have to say greed is what drives this capitalism we have, without it, we might as well become a communist country and let everyone enjoys the same income, benefit and everything else.

The problem we are facing is an inherent problem of this type of capitalistic market, greed (or the drive for profit) created lots of new financial instruments, many are very useful, options, swaps, futures, but some causes problem, like the ones with Enron and the ones with MBS. Greed and the drive for profit will also create economic cycle, a boom and then a bust because as people try to seek profit, there will be over buying of certain asset during boom, and that will create bust, like the tech bubble we had and the real estate bubble we are having.

Is all this bad? well in my opinion, there will never be a perfect economy or society. US has been very successful with the current capitalism, and the crisis we have is just a price we have to pay for having greed/profit driven economy. So I hope we don't get panic because of the this natural cycle we are experiencing and change the fundamentals that has make this economy so successful.
 

ProfJohn

Lifer
Jul 28, 2006
18,251
5
0
Originally posted by: venkman
National Debt is the cause of the Government spending TOOO MUCH DANG MONEY on things like Star Wars Defense Programs and War in Iraq II.
Japan's nation debt is twice it's GDP (imagine if our debt was $24 trillion!!) and yet their defense spending in less than 1% of their GDP, about a third of ours.

So much for debt being caused by defense spending.

BTW Italy, Greece, Norway, Canada, France and Germany all have higher debt levels than the US and none of them spending close to the amount on defense that we do.
 

halik

Lifer
Oct 10, 2000
25,696
1
0
Originally posted by: nobodyknows
Originally posted by: cKGunslinger
Man, you totally thrashed that straw man. He didn't have a chance...

:confused:
You disagree?

Instead of lowering interest rates under the pretense of helping the stock market make that "soft landing" they should have been raising interest rates to slow inflation.

Using my 20/20 hindsight, the stock market has tanked anyway and the greedy banks are screaming for taxpayer's money. Look at AIG it seems they are too busy throwing parties to sit down and figure out what they can do cut costs.
Retarded comment of the week.... what happens to aggregate money supply during a credit crunch?

This is the problem with Ron Paulonomics and his supporters - they just lack the basic concepts of economics and go off of the garbage they find on other supporters' websites.

Here's what's actually happening to inflation
 

halik

Lifer
Oct 10, 2000
25,696
1
0
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text ( I hope i don't have to regress it for you to see that the correlation of the housing bubble to the gov't treasury rates is virtually non-existant)

 

ProfJohn

Lifer
Jul 28, 2006
18,251
5
0
Originally posted by: JohnOfSheffield
SHUT THE FUCK UP!

In three weeks the US spends as much money in Iraq as they do on the entire war on terrorism in seven years.

I asssume that a trillion isn't needed in the US economy, so you give the banks less than what a completely worthless war that still costs 10 billion a week?

Yeah, really fucking smart. This does not take into account the cost for false imprisonment and torture though, along with 100+ unexplained deaths, but human lifes are worth nothing if it's not yours, right?
I can't believe you fell for that BS line.

Iraq cost $150 billion a year, or $3 billion a week or $9 billion over 3 weeks.

Afghan spending
We have spent $172 billion in Afghanistan since 9-11.
That is more than we spend on Iraq in a year.

Overall we have spent $859 billion since 9-11 on Iraq, Afghanistan and 'enhanced base security'

In that same 6 year period we have spent around $2.5 trillion on Medicare.
 

bamacre

Lifer
Jul 1, 2004
21,030
1
61
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
 

halik

Lifer
Oct 10, 2000
25,696
1
0
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
I quote:
These governmental measures, combined with the Federal Reserve's loose monetary policy, led to an unsustainable housing boom. The key measure by which the Fed caused this boom was through the manipulation of interest rates, and the open market operations that accompany this lowering.
Look no one is disputing that encouraging subprime loans where the market wouldn't touch them was a good idea. I'm arguing the loony stuff that RP is known for. He's trying and failing to make the Austrian argument that low interest rates caused the boom, I just linked a historical prices/rates chart that shows no such causality.

This is why virtually all economists disregard the Austrian thing as quackery - its prediction are consistently at odds with reality.
 

nobodyknows

Diamond Member
Sep 28, 2008
5,474
0
0
Originally posted by: halik
Originally posted by: nobodyknows
Originally posted by: cKGunslinger
Man, you totally thrashed that straw man. He didn't have a chance...

:confused:
You disagree?

Instead of lowering interest rates under the pretense of helping the stock market make that "soft landing" they should have been raising interest rates to slow inflation.

Using my 20/20 hindsight, the stock market has tanked anyway and the greedy banks are screaming for taxpayer's money. Look at AIG it seems they are too busy throwing parties to sit down and figure out what they can do cut costs.
Retarded comment of the week.... what happens to aggregate money supply during a credit crunch?

This is the problem with Ron Paulonomics and his supporters - they just lack the basic concepts of economics and go off of the garbage they find on other supporters' websites.

Here's what's actually happening to inflation
You link to an article that says inflation concerns are easing AFTER the bubble burst?? Like that even addresses the issues that led up to this??

You're even more retarded then me. :p
 

bamacre

Lifer
Jul 1, 2004
21,030
1
61
Originally posted by: halik
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
I quote:
These governmental measures, combined with the Federal Reserve's loose monetary policy, led to an unsustainable housing boom. The key measure by which the Fed caused this boom was through the manipulation of interest rates, and the open market operations that accompany this lowering.
Look no one is disputing that encouraging subprime loans where the market wouldn't touch them was a good idea. I'm arguing the loony stuff that RP is known for. He's trying and failing to make the Austrian argument that low interest rates caused the boom, I just linked a historical prices/rates chart that shows no such causality.

This is why virtually all economists disregard the Austrian thing as quackery - its prediction are consistently at odds with reality.

Sorry, I'll listen to Vic before I would you...

Originally posted by: Vic
Originally posted by: Evan Lieb
Originally posted by: bamacre
I blame the Fed for shoving the money out. Low interest rates lead to malinvestment.
Only if you believe in the nonsense of Ron Paul Economics.
I think it's inarguable that artificially low interest rates fueled excessive borrowing, which was the primary cause of all this (although not the only cause by a long shot).

You don't need to be a Ron Paul follower to see that.

And you should at least change the title of your OP now that you presumably know it's BS. ;)
 

halik

Lifer
Oct 10, 2000
25,696
1
0
Originally posted by: nobodyknows
Originally posted by: halik
Originally posted by: nobodyknows
Originally posted by: cKGunslinger
Man, you totally thrashed that straw man. He didn't have a chance...

:confused:
You disagree?

Instead of lowering interest rates under the pretense of helping the stock market make that "soft landing" they should have been raising interest rates to slow inflation.

Using my 20/20 hindsight, the stock market has tanked anyway and the greedy banks are screaming for taxpayer's money. Look at AIG it seems they are too busy throwing parties to sit down and figure out what they can do cut costs.
Retarded comment of the week.... what happens to aggregate money supply during a credit crunch?

This is the problem with Ron Paulonomics and his supporters - they just lack the basic concepts of economics and go off of the garbage they find on other supporters' websites.

Here's what's actually happening to inflation
You link to an article that says inflation concerns are easing AFTER the bubble burst?? Like that even addresses the issues that led up to this??

You're even more retarded then me. :p
No pointing out the flaw in your argument. You said they should've been raising interest rates to fight inflation, instead of lowering them (implying that will cause inflation).

Instead fed lowers rates and low & behold inflation eases also (despite 700B bail out). How do you explain that with your 'logic'?
 

Fern

Elite Member
Super Moderator
Sep 30, 2003
26,907
173
106
Originally posted by: ProfJohn
Originally posted by: JohnOfSheffield
SHUT THE FUCK UP!

In three weeks the US spends as much money in Iraq as they do on the entire war on terrorism in seven years.

I asssume that a trillion isn't needed in the US economy, so you give the banks less than what a completely worthless war that still costs 10 billion a week?

Yeah, really fucking smart. This does not take into account the cost for false imprisonment and torture though, along with 100+ unexplained deaths, but human lifes are worth nothing if it's not yours, right?
I can't believe you fell for that BS line.

Iraq cost $150 billion a year, or $3 billion a week or $9 billion over 3 weeks.

Afghan spending
We have spent $172 billion in Afghanistan since 9-11.
That is more than we spend on Iraq in a year.

Overall we have spent $859 billion since 9-11 on Iraq, Afghanistan and 'enhanced base security'

In that same 6 year period we have spent around $2.5 trillion on Medicare.
That's pocket change.

We just blew that much in a few weeks between AIG etc and the Senate bailout plan. I'm now hearing Pelosi wants to up it another $300 billion?

Fern
 

halik

Lifer
Oct 10, 2000
25,696
1
0
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
I quote:
These governmental measures, combined with the Federal Reserve's loose monetary policy, led to an unsustainable housing boom. The key measure by which the Fed caused this boom was through the manipulation of interest rates, and the open market operations that accompany this lowering.
Look no one is disputing that encouraging subprime loans where the market wouldn't touch them was a good idea. I'm arguing the loony stuff that RP is known for. He's trying and failing to make the Austrian argument that low interest rates caused the boom, I just linked a historical prices/rates chart that shows no such causality.

This is why virtually all economists disregard the Austrian thing as quackery - its prediction are consistently at odds with reality.

Sorry, I'll listen to Vic before I would you...

Originally posted by: Vic
Originally posted by: Evan Lieb
Originally posted by: bamacre
I blame the Fed for shoving the money out. Low interest rates lead to malinvestment.
Only if you believe in the nonsense of Ron Paul Economics.
I think it's inarguable that artificially low interest rates fueled excessive borrowing, which was the primary cause of all this (although not the only cause by a long shot).

You don't need to be a Ron Paul follower to see that.

And you should at least change the title of your OP now that you presumably know it's BS. ;)
I miss the point you're trying to make... I just showed you a graph of real estate prices and treasury rates that shows no correlation to your hypothesis. Interest rates have been dropping since the 80s (that's when the biggest drops occured), yet the exhuberant growth in RE prices didn't happen till mid-90s

Actually the real estate bubble started in 97, in the height of our economic boom and in the climate where interest rates were going up.
 

BoberFett

Lifer
Oct 9, 1999
37,563
9
81
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
Don't bother to question these so called financial gurus. They've all their heads shoved so far up each others asses they've forgotten what the real world looks like.
 

halik

Lifer
Oct 10, 2000
25,696
1
0
Originally posted by: BoberFett
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
Don't bother to question these so called financial gurus. They've all their heads shoved so far up each others asses they've forgotten what the real world looks like.
I'm glad you've added to this discussion... is Alan Greenspan gonna be delivering your first child?
 

bamacre

Lifer
Jul 1, 2004
21,030
1
61
Originally posted by: BoberFett
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
Don't bother to question these so called financial gurus. They've all their heads shoved so far up each others asses they've forgotten what the real world looks like.
Advice taken. Their stance that the government can effectively manage the economy says enough. And their staunch support of this notion during this point in history is just gravy.
 

SP33Demon

Lifer
Jun 22, 2001
27,929
141
106
Originally posted by: halik
Originally posted by: SP33Demon
Who is RAN Paul? If you spent half as much time with your spelling instead of spouting stupid BS like "deficit spending, us national debt had NOTHING to do with the current economic climate" then maybe you would be taken seriously.

Even a preschooler could tell you that increasing national debt at an alarming rate will affect consumer confidence levels, which in turn affects domestic and global markets. Stop being a fcking troll.
Alarming Rate? Hop on your bloomberg and tell me what's the credit rating for U.S. Treasuries....

Nice ad hominem tough, shows you really know nothing.
The national debt doubled in the past 8 years (which has never happened in history), keep saying stupid sht and trolling though.

Your quote is so sig worthy:
deficit spending, us national debt had NOTHING to do with the current economic climate - Halik

BTW, why aren't you whining like a little girl about LIBOR rates anymore for your student loan? You should create another troll thread about that while you're at it. Don't forget to attach "RAN Paul" so you can complete your BS degree in Trolling. :disgust:
 

SP33Demon

Lifer
Jun 22, 2001
27,929
141
106
Originally posted by: halik
Originally posted by: BoberFett
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
Don't bother to question these so called financial gurus. They've all their heads shoved so far up each others asses they've forgotten what the real world looks like.
I'm glad you've added to this discussion... is Alan Greenspan gonna be delivering your first child?
More proof that you're nothing more than a fcking troll.

 

nobodyknows

Diamond Member
Sep 28, 2008
5,474
0
0
Originally posted by: halik
Originally posted by: nobodyknows
Originally posted by: halik
Originally posted by: nobodyknows
Originally posted by: cKGunslinger
Man, you totally thrashed that straw man. He didn't have a chance...

:confused:
You disagree?

Instead of lowering interest rates under the pretense of helping the stock market make that "soft landing" they should have been raising interest rates to slow inflation.

Using my 20/20 hindsight, the stock market has tanked anyway and the greedy banks are screaming for taxpayer's money. Look at AIG it seems they are too busy throwing parties to sit down and figure out what they can do cut costs.
Retarded comment of the week.... what happens to aggregate money supply during a credit crunch?

This is the problem with Ron Paulonomics and his supporters - they just lack the basic concepts of economics and go off of the garbage they find on other supporters' websites.

Here's what's actually happening to inflation
You link to an article that says inflation concerns are easing AFTER the bubble burst?? Like that even addresses the issues that led up to this??

You're even more retarded then me. :p
No pointing out the flaw in your argument. You said they should've been raising interest rates to fight inflation, instead of lowering them (implying that will cause inflation).

Instead fed lowers rates and low & behold inflation eases also (despite 700B bail out). How do you explain that with your 'logic'?
I can explain it so simply that even a retard like me can understand it.


Right now (post collapse?) the greater danger is not inflation but falling into a deflationary spiral. If they had been gently nudging interest rates up the last 5 years instead of lowering them not only would the bubble not have been so large when it popped, but we would have had more room to lower interest rates.
 

BoberFett

Lifer
Oct 9, 1999
37,563
9
81
Originally posted by: halik
Originally posted by: BoberFett
Originally posted by: bamacre
Originally posted by: halik
Originally posted by: bamacre
Halik,...
http://www.cnn.com/2008/POLITICS/09/23/paul.bailout/

I don't see where he blame this on the national debt. Maybe you aught to actually know his position before you try to bash it. ;)

This is from 2003 btw,....
http://www.lewrockwell.com/paul/paul128.html
Much like every other economist has done already, I must point out that your austrian hypothesis about fed is at odd with reality:
Text
Did you even bother to read at least the first link?

Your thread title and assertion in the OP are stupid. No one is blaming the current economic crisis on the size of our national debt. No one. I don't even know where you got this idea. You have no idea what his stance is, yet have a whole thread bashing it.
Don't bother to question these so called financial gurus. They've all their heads shoved so far up each others asses they've forgotten what the real world looks like.
I'm glad you've added to this discussion... is Alan Greenspan gonna be delivering your first child?
My daughter is nine, so unless he's also a mad scientist and invents a time machine in addition to being an obstetrician, probably not.

And I don't really trust Greenspan to run our economy either, so I'm not sure what your point is.
 

Wheezer

Diamond Member
Nov 2, 1999
6,731
1
0
Originally posted by: JohnOfSheffield
Originally posted by: Wheezer
Originally posted by: venkman
National Debt is the cause of the Government spending TOOO MUCH DANG MONEY on things like Star Wars Defense Programs and War in Iraq II.
Here is a nice list of pork spending in 2008.

-Potato Breeding?
-Citrus Waste Utilization?
-New Mexico Sheriff and Police Athletic league?
-Light Brown Maple moth?


and those are just a few that stand out by name...who the hell knows where the money truly went for the rest of those projects.

this mess was not caused by lack of government oversight....but by too much oversight.

The government stepped in and told the banks to lower their restrictions, lower their credit worthiness standards and to lower the amount required for a down payment.


The government assured them that nothing would go wrong.



ooops.
SHUT THE FUCK UP!

In three weeks the US spends as much money in Iraq as they do on the entire war on terrorism in seven years.

I asssume that a trillion isn't needed in the US economy, so you give the banks less than what a completely worthless war that still costs 10 billion a week?

Yeah, really fucking smart. This does not take into account the cost for false imprisonment and torture though, along with 100+ unexplained deaths, but human lifes are worth nothing if it's not yours, right?

You got hostility issues....problems from childhood?....see a therapist...otherwise people like me are going to give you a coronary.....you really wanna be found slumped over your keyboard dead from a stress related heart attack responding to someone over the internet?

your choice I guess.
 

HendrixFan

Diamond Member
Oct 18, 2001
4,648
0
71
Originally posted by: rchiu
Originally posted by: HendrixFan
Inflation and national debt make the current crisis worse, but they are not directly the problem. The reason we have inflation (from printing money and from too low of interest rates) and a huge national debt have the same root cause as this bailout. Unchecked greed, greed that will stop at nothing, including long term harm, to win in the short term.
Well, without sounding too much like Gordon Gekko, I have to say greed is what drives this capitalism we have, without it, we might as well become a communist country and let everyone enjoys the same income, benefit and everything else.

The problem we are facing is an inherent problem of this type of capitalistic market, greed (or the drive for profit) created lots of new financial instruments, many are very useful, options, swaps, futures, but some causes problem, like the ones with Enron and the ones with MBS. Greed and the drive for profit will also create economic cycle, a boom and then a bust because as people try to seek profit, there will be over buying of certain asset during boom, and that will create bust, like the tech bubble we had and the real estate bubble we are having.

Is all this bad? well in my opinion, there will never be a perfect economy or society. US has been very successful with the current capitalism, and the crisis we have is just a price we have to pay for having greed/profit driven economy. So I hope we don't get panic because of the this natural cycle we are experiencing and change the fundamentals that has make this economy so successful.
I understand what you are saying, and I agree mostly. I think that when you let companies merge and become as large as they are, you aren't talking about normal fundamentals of economics and capitalism. The large corporations have too much power for the natural balance to occur in the marketplace. With power comes responsibility, and since the companies are large enough to take down our economy (this is only disputable if you feel that no bailout of any sort was needed) they need to be responsible. I don't mean accountable, that is a separate issue. They need to take responsibility for the power they hold over our economy, and if they don't care to, then there has to be government oversight. Maybe even throw in some incentives that would encourage long term growth while we are at it.

I don't think sounding alarm bells and slaying capitalism is the answer. But I would say that something needs to be done to restore a needed balance.
 

LegendKiller

Lifer
Mar 5, 2001
18,256
68
86
Originally posted by: smack Down
Originally posted by: halik
Originally posted by: Capitalizt
It wasn't the national debt.. It was a fiat bubble caused by artificially low interest rates and federal laws that mandated lending to unqualified borrowers. The federal reserve kept lending rates far too low for too long, leading to lots of malinvestment and over-borrowing. When the sh!t hit the fan, people couldn't make the payments and the entire house of cards collapsed. If we had more of a free market in interest rates, many of the bad loans would never have occurred. The bubble would not have reached such an extreme...and taxpayers would not be on the hook for trillions of dollars.
I don't think too many economists will side with you on the interest rate part - it was more so an issue of deregulation and government intervention for the "greater good" and IMO outcome predicted by behavioral finance
deregulation can not cause problems. Is it really your claim that investors thought hey it is illegal to make really bad investments so free money for everyone.
Bullshit. 2004 Leverage allowance. Glass Steagall elimination. FAS140/FIN46 off-balance sheet. Derivative unregulation.

All caused these problems.
 

halik

Lifer
Oct 10, 2000
25,696
1
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Originally posted by: SP33Demon
Originally posted by: halik
Originally posted by: SP33Demon
Who is RAN Paul? If you spent half as much time with your spelling instead of spouting stupid BS like "deficit spending, us national debt had NOTHING to do with the current economic climate" then maybe you would be taken seriously.

Even a preschooler could tell you that increasing national debt at an alarming rate will affect consumer confidence levels, which in turn affects domestic and global markets. Stop being a fcking troll.
Alarming Rate? Hop on your bloomberg and tell me what's the credit rating for U.S. Treasuries....

Nice ad hominem tough, shows you really know nothing.
The national debt doubled in the past 8 years (which has never happened in history), keep saying stupid sht and trolling though.

Your quote is so sig worthy:
deficit spending, us national debt had NOTHING to do with the current economic climate - Halik

BTW, why aren't you whining like a little girl about LIBOR rates anymore for your student loan? You should create another troll thread about that while you're at it. Don't forget to attach "RAN Paul" so you can complete your BS degree in Trolling. :disgust:
So young and so angry... keep repeating that typo though, it will make you look more mature.

Looking at the nominal debt amount alone tells you nothing - had you actually taken a finance course in your life, you'd know that credit rating covenants (the only risk that debt poses to the U.S.) are relative - you look at the debt to value and debt coverage ratio. So long our GDP keeps growing, our debt can grow at the same rate and we'd be equally as risky (c.p.)

Also Libor has been coming down; not that it makes any difference to me since my loan reset was in July and the rate went down 1.2% YoY.

I'm still waiting for you to somehow prove that the nominal amount of U.S. dept is somehow responsible for the credit crisis. This ain't ronpaulforums; we enjoy, you know, facts....

Oh also about the troll comments, I'm a former Investment Research analyst at Goldman with B.S. in Economics and 2 months away from getting Applied Economics Master's ... who are you again?
 

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