The simple facts that everyone should know about economics

[CADsortaGUY]

Originally posted by: SuperTool

Originally posted by: alchemize

Originally posted by: SuperTool
The problem is that Republicans are first to deficit spend, but when the government is running a "surplus" they are the first to yell that people are overtaxed and surplus means "the govt is taking too much of our money"

Oh really?

Thanks, your chart made my point. Deficits go up up up until 1992, down down down until 2000, and up up up from 2001. I rest my case.

I wouldn't if I were you

That chart showed who was in control of Congress. Seems the best gains came when Republicans were in control.

They all suck- they all WASTE our money - they ALL have allowed entitlements to ruin our budget.

Time for fiscal reform - from the bottom up or top down - I don't care - it ALL needs to be gone through with a fine tooth comb.

CkG

 

[SuperTool]

Originally posted by: CADkindaGUY

Originally posted by: SuperTool

Originally posted by: alchemize

Originally posted by: SuperTool
The problem is that Republicans are first to deficit spend, but when the government is running a "surplus" they are the first to yell that people are overtaxed and surplus means "the govt is taking too much of our money"

Oh really?

Thanks, your chart made my point. Deficits go up up up until 1992, down down down until 2000, and up up up from 2001. I rest my case.

I wouldn't if I were you

That chart showed who was in control of Congress. Seems the best gains came when Republicans were in control.

They all suck- they all WASTE our money - they ALL have allowed entitlements to ruin our budget.

Time for fiscal reform - from the bottom up or top down - I don't care - it ALL needs to be gone through with a fine tooth comb.

CkG

The republicans are still in control, and we are running enormous deficits. So no correlation there.
You are looking at absolutes, I am looking at the inflection points. Who is putting the brakes on the deficit between 1992 and 2000 and who is putting the pedal to the metal prior to 1992 and after 2001.

 

[XZeroII]

Originally posted by: SuperTool

Originally posted by: XZeroII

Originally posted by: SuperTool
The problem is that Republicans are first to deficit spend, but when the government is running a "surplus" they are the first to yell that people are overtaxed and surplus means "the govt is taking too much of our money"

This is not the place for political mumbo-jumbo.

It's POLITICS and News forum

DOH!

 

[coolVariable]

Mr. Teacher, sir?

Well, maybe unemployment isn't rising because THIS IS NOT A RECESSION.

If you check your economic radar you will see that some of the smarter economists are thinking that this is a deflationary DEPRESSION.
As a result we will probably see:
- falling stock prices (DJIA at ~400-1000 points according to wave economics)
- rising unemployment (20-30%)
- companies, corporations, banks, and insurance companies collapsing

But think happy! At least everyone around you will be hungry too!
This depression will - with all likelyhood - be far, far worse then the one 1929-1932. All the economic indicators show that.

 

[CADsortaGUY]

Originally posted by: coolVariable
Mr. Teacher, sir?

Well, maybe unemployment isn't rising because THIS IS NOT A RECESSION.

If you check your economic radar you will see that some of the smarter economists are thinking that this is a deflationary DEPRESSION.
As a result we will probably see:
- falling stock prices (DJIA at ~400-1000 points according to wave economics)
- rising unemployment (20-30%)
- companies, corporations, banks, and insurance companies collapsing

But think happy! At least everyone around you will be hungry too!
This depression will - with all likelyhood - be far, far worse then the one 1929-1932. All the economic indicators show that.

/me thinks someone's radar needs to be reconfigured.

CkG

 

[MonkeyK]

Originally posted by: XZeroII

Originally posted by: MonkeyK
So basically you are saying that spending drives the economy. To move things along, spending can be encouraged for people, business, or the Govt can spend. Things go bad when less is spent.

What you do not say is why it takes a long time for busineses, people, and the Govt. to change rates spending.

Agreed. You are correct.

So then, you have missed the most important part of explaining that Bush is not responsible for the downturn (not that I am saying that he is). All that you say is that there is nothing that he could have done to change things so quickly.
I am not an economist, but there are possible reasons that business spending would decline rapidly a couple come to mind:
-anticipation of reforms to the way that business can be run
-seeing a peer fail

 

[Alexadi]

10. Another way to fight a recession (which I do not personally agree with) is to increase gov't spending. This will send more money to business' as the gov't buys stuff from them. Once the business' have more money, they will hire more people which means that people will have more money to spend, and yadda yadda yadda (if you don't get it, take an economics class). I don't like this method because our gov't is spend happy and I feel like they are just bypassing the system when the do this. Limited increases in gov't spending is ok, but it shouldn't be major.

Ok, keeping it simple, where do all those government money come from?
a)printing machine
b)borrowing from the usa
c)borrowing from outside the usa.

In cases a and b, you see that there are no actual extra goods, services or resources in the ecomomy, just more "money" aka inflation.
In case c you do see that those loans will have to be repaid, with interest.
This can be done by:
d) taxing the profits during the following boom
e) inflation i.e. taxing everyone, because everyone can buy less real goods/services/resources during an inflation and the difference is taken by the government to repay the foreign creditors.

So please explain to me why should the government take loans from foreign banks to spend in the economy and then repay those loans from future taxes, INSTEAD of the actual corporations taking loans from foreign banks and repaying them from future profits.
Is the Government so much more efficient and economically enlightened so as to make better decisions about where to invest and what will bring about profits and efficiency?

 

[manly]

Great, more of XZeroII's patronizing insight.

Out of points 7 - 12, only #8 is indisputable, but as usual, XZeroII misses the point completely. Most informed critics don't slam Bush for causing the recession, but for poor stewardship of the economy since he took office.* Many of the other points in 7 - 12 are debatable, inaccurate, or oversimplified. For example, since when does taking Econ 1 qualify you to speak authoritatively about economics?

You say these are facts, but I can't prove them. Funny thing is half the time, economics is tinged by politics. And funny that when Bush bashers slam the administration for purposeful deceit or incompetence, you demand "smoking gun" incontrovertible proof (yeah like any of us works in the NSC). Seems like a double standard there.

* If I'm not mistaken, even though you have little actual grasp of the situation here in CA, you'd blame Gray Davis for the energy crisis. He's about as responsible for that as Bush is for the national recession. Really, you're no different than many of the partisan masses in either party.

So what's the next expert lesson from you? How to assemble nuclear devices in the basement, or perhaps how to hide WMDs from an invading army?

 

[xxxxxJohnGaltxxxxx]

Originally posted by: coolVariable
Mr. Teacher, sir?

Well, maybe unemployment isn't rising because THIS IS NOT A RECESSION.

If you check your economic radar you will see that some of the smarter economists are thinking that this is a deflationary DEPRESSION.
As a result we will probably see:
- falling stock prices (DJIA at ~400-1000 points according to wave economics)
- rising unemployment (20-30%)
- companies, corporations, banks, and insurance companies collapsing

But think happy! At least everyone around you will be hungry too!
This depression will - with all likelyhood - be far, far worse then the one 1929-1932. All the economic indicators show that.

Please provide me a name and address of these so-called economist who think were 1.) in a depression 2.) predict 20-30% unemployment....I'm sending a truck for them.

 

[xxxxxJohnGaltxxxxx]

Originally posted by: Alexadi




Is the Government so much more efficient and economically enlightened so as to make better decisions about where to invest and what will bring about profits and efficiency?

In reality? No. Around here? Yes.

 

[Orsorum]

Originally posted by: coolVariable
Mr. Teacher, sir?

Well, maybe unemployment isn't rising because THIS IS NOT A RECESSION.

If you check your economic radar you will see that some of the smarter economists are thinking that this is a deflationary DEPRESSION.
As a result we will probably see:
- falling stock prices (DJIA at ~400-1000 points according to wave economics)
- rising unemployment (20-30%)
- companies, corporations, banks, and insurance companies collapsing

But think happy! At least everyone around you will be hungry too!
This depression will - with all likelyhood - be far, far worse then the one 1929-1932. All the economic indicators show that.

Good. Might give me a chance to buy some cheap stocks for the future. I have another 50 years to build up my portfolios.

Do you have links to economists who support your statements?

 

[amok]

So what's the next expert lesson from you? How to assemble nuclear devices in the basement, or perhaps how to hide WMDs from an invading army?

That one always cracks me up. Nuclear devices built in the basement, lol.

 

[LunarRay]

Economics simply stated is the observation and prediction of a big pot of water in which reside the consumer and producer of goods and services (given they do both) trying to climb out of the pot are the consumers who are not producers (the dole people). Somewhere is a mysterious being that carries all sorts of dynamically effective little tools including matches to heat up the water and cause the consumers to consume and the producers to produce. If the water cools down so do the little entities in the pot. Too hot and they go bonkers and die. We call this being 'Mr. Stimuli'. He's the god of economy. He don't know what the people will do tomorrow but he thinks he knows what they did last time certain stimuli was added to the pot. So he regulates the temperature of the water, tastes it and adjusts the seasoning stimuli to produce a broth that suits his taste... Sometimes, however, the pot people tinkle in the pot and Mr. Stimuli mistakes this for an abundance of salt. So his adjusts some more sometimes he's right and some times he ain't. He is constantly trying to keep the 'dole' people from climbing out of the pot so his attention is not always on the broth but, he tries. He sits and cogitates all day long trying to figure out what combination of ingredients caused the good taste last time and what caused the bad taste before that. Pot people are not always predictable and he thinks they are... Such is the life of the Pot People and Mr. Stimuli.

 

[dmcowen674]

Originally posted by: CADkindaGUY

Originally posted by: coolVariable
Mr. Teacher, sir?

Well, maybe unemployment isn't rising because THIS IS NOT A RECESSION.

If you check your economic radar you will see that some of the smarter economists are thinking that this is a deflationary DEPRESSION.
As a result we will probably see:
- falling stock prices (DJIA at ~400-1000 points according to wave economics)
- rising unemployment (20-30%)
- companies, corporations, banks, and insurance companies collapsing

But think happy! At least everyone around you will be hungry too!
This depression will - with all likelyhood - be far, far worse then the one 1929-1932. All the economic indicators show that.

/me thinks someone's radar needs to be reconfigured.

CkG

There is not much to stop it from happening. Currently the Rich Boys are pumping into the anemic Stock market to make it look like it is re-bounding, as soon as they have put in all that they can it's all over.

Plants continue shutting down, massive layoff's continue to be front page News such as thousands let go by RJR today.
Does anyone see News of new plants going online? Does anyone see loads of Help Wanted signs? NO and NO.

Most Corporations that can merge have already done so, so now it is time to either sink or swim.

There are a lot of Banks merging now, hmm wonder why, could it be because they can't survive with the debt load and defaults alone anymore???

I agree, when it crashes it will be even harder than 1929 because then it was a fast surprise and those that didn't have anything in the Stock Market and were doing OK were able to support the rest of the Country until it got back on it's feet. This time those that are not in the Stock Market are in serious trouble already so there is nothing and nobody to fall back on to save this Country's butt.

 

[alchemize]

Originally posted by: dmcowen674

Originally posted by: CADkindaGUY

Originally posted by: coolVariable
Mr. Teacher, sir?

Well, maybe unemployment isn't rising because THIS IS NOT A RECESSION.

If you check your economic radar you will see that some of the smarter economists are thinking that this is a deflationary DEPRESSION.
As a result we will probably see:
- falling stock prices (DJIA at ~400-1000 points according to wave economics)
- rising unemployment (20-30%)
- companies, corporations, banks, and insurance companies collapsing

But think happy! At least everyone around you will be hungry too!
This depression will - with all likelyhood - be far, far worse then the one 1929-1932. All the economic indicators show that.

/me thinks someone's radar needs to be reconfigured.

CkG

There is not much to stop it from happening. Currently the Rich Boys are pumping into the anemic Stock market to make it look like it is re-bounding, as soon as they have put in all that they can it's all over.

Plants continue shutting down, massive layoff's continue to be front page News such as thousands let go by RJR today.
Does anyone see News of new plants going online? Does anyone see loads of Help Wanted signs? NO and NO.

Most Corporations that can merge have already done so, so now it is time to either sink or swim.

There are a lot of Banks merging now, hmm wonder why, could it be because they can't survive with the debt load and defaults alone anymore???

I agree, when it crashes it will be even harder than 1929 because then it was a fast surprise and those that didn't have anything in the Stock Market and were doing OK were able to support the rest of the Country until it got back on it's feet. This time those that are not in the Stock Market are in serious trouble already so there is nothing and nobody to fall back on to save this Country's butt.

We have two excellent doom and gloom economists now I should convert all my 401(k) and IRA money to cash and just wait for the crash!


"Currently the Rich Boys are pumping into the anemic Stock market to make it look like it is re-bounding"

That's classic. Almost signature worthy. This guy isn't ready for Econ 101, he needs that remedial elementary class where they teach you how to fill out a check and make change for a $20.

 

[XZeroII]

Originally posted by: manly
Great, more of XZeroII's patronizing insight.

Out of points 7 - 12, only #8 is indisputable, but as usual, XZeroII misses the point completely. Most informed critics don't slam Bush for causing the recession, but for poor stewardship of the economy since he took office.* Many of the other points in 7 - 12 are debatable, inaccurate, or oversimplified. For example, since when does taking Econ 1 qualify you to speak authoritatively about economics?

You say these are facts, but I can't prove them. Funny thing is half the time, economics is tinged by politics. And funny that when Bush bashers slam the administration for purposeful deceit or incompetence, you demand "smoking gun" incontrovertible proof (yeah like any of us works in the NSC). Seems like a double standard there.

* If I'm not mistaken, even though you have little actual grasp of the situation here in CA, you'd blame Gray Davis for the energy crisis. He's about as responsible for that as Bush is for the national recession. Really, you're no different than many of the partisan masses in either party.

So what's the next expert lesson from you? How to assemble nuclear devices in the basement, or perhaps how to hide WMDs from an invading army?

Read the top of my post...

I should also mention that these are not actually facts. They are the most commonly viewed theories. Economics is not an exact science and changes all the time. It is also impossible to prove or disprove any of this.

As I've said before (if you'd actually read the post), I'm trying to explain things in a simple way so people can have a rough understanding of what is going on. Yes, most of this is oversimplified, but not to the point where it's useless.

 

[rjain]

About GDP: The way GDP of computer hardware is computed is that they use the value of equivalently powerful hardware in 1996. IOW, if you buy a new 3 GHz P4, the contribution to GDP isn't how much you paid for it, it's how much a processor with that amount of computing power would have cost in 1996. This bogus inflation accounted for nearly half of our 2nd quarter GDP increase.

 

[rjain]

Originally posted by: dmcowen674
Does anyone see loads of Help Wanted signs?

Yes.
One of the problems right now is a lack of labor supply. Even though there are plenty of people without jobs, they don't want the jobs that need filling right now. They want that great dot-com job where all they did was drink Starbucks and come to work in shorts to play video games while they were funded by some venture capitalist who didn't know the difference between a computer and a calculator. But since they have no job experience, no degree, and no desire to do anything, no one wants to hire them for the exorbitant salaries they demand. For example, Costco is suffering because their labor costs are way too high.

 

[Miramonti]

sorry, but whatever Bush inherited, he's been completely destructive since.

He's been about as fiscally responsible as a two year old running his own 7-11.