The Problem With keynesian economics

[BakshisMouse]

As I said, Greenspan could have helped prevent the crisis by taking money from the economy by ordering open market sales of bonds.

what you mean to say is that Greenspan could have reversed the bubble or not let it form at all by decreasing the money supply. Don't blame the banks for what the liberals did!!

Don't just blame the liberals for the housing bubble. If the banks and financial firms were so unwilling to make such laons, why were mortage backed securities classified as AAA investments by Standard and Poors up until the time they were worthless?

 

[EdwardBaiamonte]

Don't just blame the liberals for the housing bubble.

why not their bleeding heart policy was to subvert the free market to get people into house the free market said they could not afford

 

[EdwardBaiamonte]

If the banks and financial firms were so unwilling to make such laons, why were mortage backed securities classified as AAA investments by Standard and Poors up until the time they were worthless?

simple!!! because real estate had never gone down in value and because the ratings firms were paid by those who sold the securities

 

[Procrustes Stretched]

The Basic Premise of Keynesian economics is that you Spend money when the Economy is Down to Stimulate it, Then Make cuts when the Economy is up.

It's 2 Sides of a Coin. The Problem is the Keynesian are only Keynesian when the Economy is down. When it is Up they forget about the Rules of Keynesian Economics and Continue to Spend more than we have instead of Making cuts.

We never cut

So you agree that Keynesian Economics works when enacted faithfully.



btw, Keynesians have cut -- so the OP Dope is a Dopey Tool

 

[EdwardBaiamonte]

The Basic Premise of Keynesian economics is that you Spend money when the Economy is Down to Stimulate it, Then Make cuts when the Economy is up.

It's 2 Sides of a Coin. The Problem is the Keynesian are only Keynesian when the Economy is down. When it is Up they forget about the Rules of Keynesian Economics and Continue to Spend more than we have instead of Making cuts.

We never cut

So you agree that Keynesian Economics works when enacted faithfully.



btw, Keynesians have cut -- so the OP Dope is a Dopey Tool

no dear he said it doesn't work in part because there are never cuts.

But , if you think it works please explain how on earth that is possible.

 

[BakshisMouse]

Don't just blame the liberals for the housing bubble.

why not their bleeding heart policy was to subvert the free market to get people into house the free market said they could not afford

Why did you cut out this part of my comment?

If the banks and financial firms were so unwilling to make such loans, why were mortage backed securities classified as AAA investments by Standard and Poors up until the time they were worthless?

Do you not have an answer?

 

[BakshisMouse]

no dear he said it doesn't work in part because there are never cuts.

But , if you think it works please explain how on earth that is possible.

If you read my posts, you might find at least one explanation. You might not accept it, but it's there.

 

[Quantum Windbag]

Yeah we wouldn't want those pesky states to decide how to use the stimulus money.

Funny, I don't recall saying that. Krugman actually said that was the best part of the stimulus. which proves he doesn't understand Keynes at all.

Yeah what would he know next to your genius.

If giving money to the states for their budgets because it would be spent quickly was good, which is what he said, the recovery would have happened relatively quickly.

It didn't.

 

[Quantum Windbag]

Frankly the stimulus wasn't big enough. And everyone knew it.

We've learned this lesson before. FDR increased spending in the 30's but it didn't seem to help much, unemployment was still very high. Then WW II came along and spending went up 10 foldish and the government essentially hired any able bodied man who needed a job to kill German and Japanese. When the war ended all those guys had stacks of cash saved up (the benefit of the 30's was they had learned austerity) and they bought houses and had kids and opened business and BOOM the economy was fixed.

Everyone?

Obama says stimulus package is right size, scope | Reuters

He lied.

Won't argue with that, but it does prove my point, not everyone knew that.

 

[EdwardBaiamonte]

When the war ended all those guys had stacks of cash saved up (the benefit of the 30's was they had learned austerity) and they bought houses and had kids and opened business and BOOM the economy was fixed.

of course thats idiotic!! If stacks of cash would fix the economy the government could just print it and give it to everyone!

Everyone bought houses???????????????? Isn't that how the current depression got started???????

Why not try Econ 101 before you comment???

 

[Procrustes Stretched]

The Basic Premise of Keynesian economics is that you Spend money when the Economy is Down to Stimulate it, Then Make cuts when the Economy is up.

It's 2 Sides of a Coin. The Problem is the Keynesian are only Keynesian when the Economy is down. When it is Up they forget about the Rules of Keynesian Economics and Continue to Spend more than we have instead of Making cuts.

We never cut

So you agree that Keynesian Economics works when enacted faithfully.



btw, Keynesians have cut -- so the OP Dope is a Dopey Tool

no dear he said it doesn't work in part because there are never cuts.

But , if you think it works please explain how on earth that is possible.

two parts:

1) Spend money when the Economy is Down to Stimulate it

2) Make cuts when the Economy is up

not having part 2 does not negate part 1. It works in part 1, which is contrary to what most cons would admit

 

[Procrustes Stretched]

[

Everyone bought houses???????????????? Isn't that how the current depression got started???????

D'Oh!!! that is not true. everyone did not buy houses.

Republicans when they were in power: huge tax cuts, two unfunded wars, and new spending programs such as Medicare Part D.

Debt Ceiling May Come Crashing Down on Treasury

 

[EdwardBaiamonte]

[
1) Spend money when the Economy is Down to Stimulate it

thats what they did to create the housing bubble and the current depression. So once again dear, how exactly can that work???

 

[Peach]

The Basic Premise of Keynesian economics is that you Spend money when the Economy is Down to Stimulate it, Then Make cuts when the Economy is up.

It's 2 Sides of a Coin. The Problem is the Keynesian are only Keynesian when the Economy is down. When it is Up they forget about the Rules of Keynesian Economics and Continue to Spend more than we have instead of Making cuts.

We never cut

The amorphous "they", yet again. Population, inflation, and events do not influence the "they" constant? Great, a new mathematical principle!

I wanna know who 'they' are ARE, and how so much is accomplished by 'them' anonymously.

 

[Quantum Windbag]

The Basic Premise of Keynesian economics is that you Spend money when the Economy is Down to Stimulate it, Then Make cuts when the Economy is up.

It's 2 Sides of a Coin. The Problem is the Keynesian are only Keynesian when the Economy is down. When it is Up they forget about the Rules of Keynesian Economics and Continue to Spend more than we have instead of Making cuts.

We never cut

So you agree that Keynesian Economics works when enacted faithfully.



btw, Keynesians have cut -- so the OP Dope is a Dopey Tool

Am I willing to admit it would work? No, but I am willing to admit it might, but we will never actually know because no one will ever use it.

 

[Procrustes Stretched]

[
1) Spend money when the Economy is Down to Stimulate it

thats what they did to create the housing bubble and the current depression. So once again dear, how exactly can that work???

PDF File:
http://fcic-static.law.stanford.edu/cdn_media/fcic-reports/fcic_final_report_conclusions.pdf

predatory lenders , secondary mortgage market , Fraudulent Underwriting, OTC derivatives market ,

Barney Frank Wikipedia:
He outlined his efforts to reform these institutions and add regulations, but met resistance from Republicans, with the main exception being a bill with Republican Mike Oxley that died because of opposition from President Bush.[53] The 2005 bill included Frank objectives, which were to impose tighter regulation of Fannie and Freddie and new funds for rental housing. Frank and Mike Oxley achieved broad bipartisan support for the bill in the Financial Services Committee, and it passed the House. But the Senate never voted on the measure, in part because President Bush was likely to veto it. "If it had passed, that would have been one of the ways we could have reined in the bowling ball going downhill called housing," Oxley told Frank. In an op-ed piece in the Wall Street Journal, Lawrence B. Lindsey, a former economic adviser to President George W. Bush, wrote that Frank "is the only politician I know who has argued that we needed tighter rules that intentionally produce fewer homeowners and more renters."[8] Once control shifted to the Democrats, Frank was able to help guide both the Federal Housing Reform Act (H.R. 1427) and the Mortgage Reform and Anti-Predatory Lending Act (H.R. 3915) to passage in 2007.[53] Frank also said that the Republican-led Gramm–Leach–Bliley Act of 1999, which repealed part of the Glass–Steagall Act of 1933 and removed the wall between commercial and investment banks, contributed to the financial meltdown

 

[EdwardBaiamonte]

[
1) Spend money when the Economy is Down to Stimulate it

thats what they did to create the housing bubble and the current depression. So once again dear, how exactly can that work???

dear, we can all cut and paste all day long!! Why not tell us all by yourself after all your reading how exactly liberal spending can help!!

 

[ilia25]

The Problem is the Keynesian are only Keynesian when the Economy is down. When it is Up they forget about the Rules of Keynesian Economics and Continue to Spend more than we have instead of Making cuts.

You mean we should do wrong thing now because we might do wrong thing in the future? That does not make sense.

Besides, depressing the economy for years adds to the debt more than you can possibly save with future cuts.

And finally, we don't have to cut spending in order to reduce the debt. We only need the economy growing faster than spending.

 

[EdwardBaiamonte]

You mean we should do wrong thing now because we might do wrong thing in the future? That does not make sense.

what doesn't make sense is to still believe another liberal spending bubble won't cause another depression or prolong the current one.

If you think government spending helps please explain exactly how or admit to being a liberal without a clue.

 

[ilia25]

dear, we can all cut and paste all day long!! Why not tell us all by yourself after all your reading how exactly liberal spending can help!!

It's easy. The economy is depressed because everyone tries to cut spending. But everyone's income is some one else's spending, so when everyone is trying to save, everyone's income falls, making it harder to pay off debt. They call it "debt deflation".

In this situation someone has to start spending. And it has to be the government -- nobody else will.