Hope you are all happy

Discussion in 'Economy' started by RetiredGySgt, Sep 29, 2008.

  1. RetiredGySgt
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    RetiredGySgt Platinum Member

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    2008 was one of 3 years I was worried about, looks like that is still a viable threat.

    No bail out and I hope you all enjoy where that leads us to.

    Yahoo! Personal Finance
     
  2. gonegolfin
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    gonegolfin Member

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    My response to the above nonsense ... directed at Bill O'Reilly and Cheryl Casone ...


    I watched about the first ten minutes of the O'Reilly Factor this evening. Both guests were whining and complaining about the failure of the bailout bill in the House of Representatives today. All had the opinion that it was ridiculous to reject a bill simply because people were mad that it would benefit Wall Street. Obviously they completely misunderstand the issue at hand. The rejection of the bill is good because it does not make economic sense. This level of ignorance on national TV compelled me to pen the following response. Note that I am under no illusion that this is over. In fact, I am expecting the leadership (comprised of both Republicans and Democrats) on this bill to target Democrats they think can be swayed into a vote of "yay" via the potential addition of goodies for troubled homeowners (meaning an even more expensive bill). I think this because the Blue Dog Democrats (fiscally conservative Democrats) and fiscally conservative Republicans will likely only be swayed by a complete change in structure of the bailout proposal. That is, a change from buying troubled assets off of the balance sheets of financial institutions to simply insuring these assets. I do not see Bush and Paulson allowing this to happen. We will see. There will be no lack of drama this week, especially after the events in both the equity markets and more importantly the credit markets (most folks do not have their eye on this) today.

    Also, the below is a good video clip of Ron Paul today speaking against the bailout plan. Thanks to Jeff Davis for forwarding this ...
    [ame]http://www.youtube.com/watch?v=YBVB1Uc0nko[/ame]

    Brian



    Mr. O'Reilly,

    I was stunned when I heard some of the comments from Cheryl Casone and yourself tonight concerning the repudiation of the bailout plan in the House of Representatives today. The lack of understanding with respect to economics, monetary policy, and our financial system from both you and Cheryl is absolutely staggering (to be fair, it is not just limited to your show). My vehement opposition to the proposed bailout bill has nothing to do with any opposition to bailing out Wall Street, bailing out homeowners, etc. that I might have. It has everything to do with perpetuating a problem that has been caused by precisely the same measures that are being proposed to fix the problem.

    Recession is a natural part of the business cycle. Especially so in the unfortunate Central Bank/Fractional Reserve System that we have in this country. Prices must be allowed to correct and find their natural equilibrium, not find an artificial floor (this is a form of price fixing) established by irresponsible monetary policy (executed by our Federal Reserve) that inevitably results in another asset bubble. The excesses and mis-allocation of capital (malinvestment) must be purged in a truly free market system. This is paramount in bringing the economy back into balance. Creating more money and taking on more debt does just the opposite, benefits a minority, and creates a bigger problem in the future. Namely, it benefits the folks that spend the the newly created money first, before prices react to the upside as the new money works its way through the economy. Meanwhile, taking on more government debt crowds out legitimate economic investment as increasingly scarce capital is the source for this expansion of government debt, leaving less for legitimate economic investment. If we pass any sort of bailout, we are going to make the problem considerably worse (somewhat better in the short term, much worse in the long term). Government intervention in our markets will create more instability in the future along with a considerably more painful recession or possibly depression. This is not to mention the tremendous moral hazard present in the solutions being proposed. The free market must be allowed to work.

    This problem was not difficult to see coming with just a reasonable background in the aforementioned subjects. I have been warning my friends and family about this for several years. Yes, it is going to be painful to do the right thing. But it is time that we take our medicine (finally ... after several chances that would have yielded a considerably less painful correction) because the cost of papering over these problems (via a foolish bailout measure) will be a much higher cost in the not too distant future.

    I hope you take the time to read this and seriously consider it. I also hope that you share this with Cheryl Casone. If you like, I can propose some good reading material that might facilitate a better understanding with respect to the real root cause of the crisis we find ourselves in.

    Regards,
    Brian Benton (a fiscal conservative wondering if there are any left)
    Austin, TX
     
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    Last edited: Sep 29, 2008
  3. Zoomie1980
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    Zoomie1980 Senior Member

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    Bottom line, until we allow housing to reach its REAL value, NOTHING is going to work. We MUST find the REAL bottom of the collateral behind all this bad debt before we can ever hope to start working it all out of system. Any system that artificially props up the price of housing, is doomed to long term failure.

    And if Americans actually have to live off cash for a while (at least for any new purchases) well, that's long overdue. We have got to stop borrowing for EVERYTHING we want and learn to obtain only things we can pay for NOW. And for those things that can only be realistically purchased with credit like homes and cars, they have to be priced at their TRUE market value so the paper backing them is worth something.
     
  4. Ravi
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    Ravi Diamond Member

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    From what I understand, and am quite amused by, is it was the far right republicans and the far left democrats that voted against the bill. The far right because it helped homeowners and the far left because it helped corporations.

    Except for the repubs that voted because they were in a snit about Nancy Pelosi.
     
  5. Bern80
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    Bern80 Gold Member

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    What a load of stereotypical bullshit. First you're trying to tell us that there was actually something in that bill that would bring relief to homeowners and second, you want us to swallow the assumption that the far right isn't for the american home owner?
     
  6. jillian
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    jillian Princess Supporting Member

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    and?
     
  7. jillian
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    jillian Princess Supporting Member

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    You know, you wouldn't be saying that if you had a kid going to college and needed your 401K which is now a 201K...

    the ignorance and shortsightedness of people never ceases to amazae me. Did you hear the idiot from Michigan yesterday who said he believes his people would choose "freedom over bread"/

    Basically he said "let them eat cake"... morons.
     
  8. Bern80
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    Bern80 Gold Member

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    You are right about ignorance and shortsightedness, just not the who. Too many people were too ignorant in understanding the mortgages they got themselves into. And there was definatley short sightedness in a actually believeing their home value would rise imperpetuity. And shortsightedness on the parts of banks to think they could build profit on basically nothing.

    And you are essentially saying that beliefs and convictions become expendable when shit happens to you. That how it works for you? Things get tough and you say fuck my standards, gimmie some shit?
     
  9. jillian
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    jillian Princess Supporting Member

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    You are proof of what I said. Convictions? About what? I watched the "free market" idiots run the economy into dirt. So where's your high ground?
     
  10. NOBama
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    NOBama Senior Member

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    Excellent post, Brian. I already emailed Bill O'Reilly to express my opinion, which parallels yours, regarding that segment of last night's show.
     
    Last edited: Sep 30, 2008

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