Blind Faith In Unregulated Markets Stoked Economic Crisis

[editec]

See my previous post. That's really akin to saying, since our population is so much more massive than it is now, the bill of rights is a threat! We should do away with the freedom to assemble! The government could control a few million people in the 1800s, but 300 million people?! That's uncontrollable, and we need more complex laws from keeping the huge population from erupting in chaos!

Is it?

No, reality and economics tells us that the problems are coming from the unintended consequences of these various regulations and institutions that were established.

ACtually I can agree with the above. Unintended consequences is almost the definition of economics.

Economics is not a matter of faith, it's a science. Just as gravity forces objects to fall at 9.8 m/s^2, the promise of a bailout, through the Federal Reserve and FDIC, causes banks to act way more recklessly than they would normally.

Economics is a science?

Well, I can now see that you know absolutely nothing about the relationship between economics and society.

Consider that if economics was even remotely like physics there'd be NO MARKET.

Do you understand why that is true?

You don't have a clue what the hell I'm even talking about, do you?

I know you cannot, if you honestly believe that the laws of economics are like the laws of physics.

Do you own any land?

How do you know you own it?

What prevents me from saying I own it?

Show usthe mathematical formula which gave that land to you and not to me, and show us ALL the economic laws (which are just like physical laws, now, according to you) that prevents me or anyone else from taking possession of it, would you?

Take you time, now and show us all your work.

We'll wait....forever if need be, until you can show us which of those fixed economics laws give you possession of that land as opposed to everyone else.

 

[sparky]

were supposed to subscribe to some sort of economic rhyme or reason with a governance who's own definition of recession indicates there is none, while Cogress holds a closed door session on mitigating economic collapse?


that was March 17th btw, they're not discussing how to make things better for us , they're discussing how to deal with us when we all come after them


that's how bad it is here now, and it amazes me that people are still trying to play the blame game and/or pin the tail on the regulator

U.S. Military Preparing for Domestic Disturbances


Obey: U.S. falling into 'massive hole'

 

[Paulie]

Where does money come from, Paul?

Better still explain to me why pieces of paper reresent something of value.

Can you do that for us?

First of all, quit patronizing me. I'm not sure who you're referring to as "us", but you'd probably be best off speaking for YOURSELF. Not everyone here agrees with your views, nor mine. There's no "us". There's you and I, when we are having dialogue.

To answer your question, money comes from anywhere, theoretically. It could be ANYTHING. That much is obvious, because we eventually decided to use merely PAPER as our medium. But it's whatever society has deemed valuable enough to use as a universal medium of exchange for goods and services.

I could not even begin to tell you WHY paper represents something of value. I don't even believe that it DOES. Just because the government SAYS it does, means jack SHIT to me. It is not valuable. It can be re-created to infinity, and anything of that sort is not something I personally consider "valuable". I have to play the game though, because the rest of society has decided that it somehow IS valuable. They'll realize soon enough how wrong they were, though. And that's why I believe in precious metals, because they are the only thing can perpetually maintain value. They are finite, they have value beyond numismatics, and they've been valuable since the beginning of humanity.

Paper money can not make that claim. Every single paper currency has collapsed. We're only merely waiting for the ones we have currently, to follow suit.

Some have tried to establish alternate systems of trade, with money not entirely backed by "faith". Liberty Dollar is a great example. You no doubt saw what the Feds had to say about THAT one in the end, though. I'm sure you heard about that raid last year where they seized all the inventory. Wasn't even marked as legal tender, either. And the US Treasury had previously stated that it wasn't illegal. Guess they changed their minds, huh?

I don't even know why you asked me this question. You already knew the answer you were going to get.

 

[Zoomie1980]

The answer is clear: Abolish the government.

Then everybody's happy, right? = )

No, you don't abolish it, you simply put it back in it's original bottle where it's primary purpose is solely national defense, law and order, and little else....

 

[Truthmatters]

The SEC chairman himself said it was Gramm Leach bliley act of 1999 which left him no way of policing the industry.

In other words DEREGULATION.

 

[Zoomie1980]

Why are so many people oblivious to the fact that historically low interest rates enticed the rush to home buying?

What we OUGHT to do is quit tampering with interest rates artificially, which is what leads to irresponsible borrowing. People should never have been given the idea that "everyone can own a home". Because that simply isn't true. Everyone is entitled to PURSUE the desire and ASPIRE to own a home. We as consumers should be smart enough to figure out our own financial situations and decide if we can afford to or not. Setting rates to near ZERO, which only serves to pressure consumers into borrowing when many SHOULDN'T have been, is causing this country a great deal of economic strife.

We, as the market, should be deciding on our OWN what the rates of interest are at a given time. Not the government.

You can regulate the banks to death, and we're still left with a dangling carrot in front of our faces whenever the Fed decides to manipulate rates.

It wasn't just low interest rates, but that combined with virtually NO standards for who money was lent to. We had people who never made more than $50,000 in any year of their lives borrowing $2,000,000 or more to flip houses out in California, Arizona and down in Florida!!! And banks lending them 125% of appraised value to do it! It was nutty. It drove home prices through the roof as well.

Low interest rates aren;t that big of a problem IF the people getting the loans are solid credit risks and banks require 10-20% down on any collateral. Unsecured debt is always a BAD idea, universally

 

[Paulie]

The SEC chairman himself said it was Gramm Leach bliley act of 1999 which left him no way of policing the industry.

In other words DEREGULATION.

Oh, well let's blindly trust his word, I mean, the government would NEVER lie to us.

 

[Paulie]

It wasn't just low interest rates, but that combined with virtually NO standards for who money was lent to. We had people who never made more than $50,000 in any year of their lives borrowing $2,000,000 or more to flip houses out in California, Arizona and down in Florida!!! And banks lending them 125% of appraised value to do it! It was nutty. It drove home prices through the roof as well.

Low interest rates aren;t that big of a problem IF the people getting the loans are solid credit risks and banks require 10-20% down on any collateral. Unsecured debt is always a BAD idea, universally

So then you advocate more stringent regulatory standards? Or do you just simply blame the bank for being irresponsible?