bailouts: did they work?

Discussion in 'Politics' started by Yurt, Dec 17, 2009.

  1. Yurt
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    Yurt Gold Member

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    i understand proving they worked is not cut and dry, however, why do people think the bailouts that gwb implemented worked?

    the supposedly too large to fail companies borrowed BILLIONS and yet a mere year later can repay it....how did they make so much money so fast?
     
  2. ☭proletarian☭
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  3. Big Black Dog
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    Big Black Dog Gold Member Supporting Member

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    They must not have worked all that well due to the high unemployment rates...
     
  4. Yurt
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    Yurt Gold Member

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  5. Yurt
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    Yurt Gold Member

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    employment is always a lagging factor....
     
  6. Kevin_Kennedy
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    Kevin_Kennedy Defend Liberty

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    I'd say the bailouts did exactly what they were intended to do. Namely, protecting the politically well-connected with taxpayer money so that they can avoid the market's natural forces and stay in business longer. Of course now we've simply added to our problems and made our situation even worse than it was.
     
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  7. Kevin_Kennedy
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    Kevin_Kennedy Defend Liberty

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    Yes, it lags because there's no recovery.
     
  8. Yurt
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    Yurt Gold Member

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    explain....because most, if not all, economist disagree
     
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  10. Kevin_Kennedy
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    Kevin_Kennedy Defend Liberty

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    Well it's certainly not all economists that disagree with my point, but most of them certainly do. Most of them are looking at our most current crop of downturns and seeing that employment stayed high while the economy was supposedly recovering. The Great Depression is a good example of this, as FDR's New Deal is said to have saved the economy despite the unemployment numbers remaining high until WWII. But the fact is that a "jobless recovery" is an oxymoron. Without people going back to a sustainable line of employment there is no recovery. The reason unemployment stays high is because government stimulus takes capital out of the private sector, thus destroying wealth and real sustainable job creation. The private sector being where wealth is created. If we allow the market to reallocate resources, which is what it is trying to do in a recession, then our downturns would last around a year and all would be well again. The recession of 1920-1921 is perfect evidence of this. It started out more severe than the Great Depression did, and because of no government stimulus and the market being allowed to correct itself it was over in about a year.
     

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