We should all agree with this!

[Kimura]

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets. We have a total net balance which is 0. There are also different methods to calculate the interest on the loan from an accounting perspective.

Most of the time the borrower will accept the loan into a bank account. The bank credits the borrower’s account for $20,000 which is a liability for the bank. The bank records the $20,000 loan as an asset, so we have a balance sheet of 0. In this first instance the balance sheet is 0 since the decrease in cash assets are offset by an increase in the loan assets. The second instance is also 0 since the increase in the bank’s assets are offset by an equal increase in the liabilities of the bank.

Even if our borrower accepts the loan amount as a checking account balance, as soon as he begins to make purchases, some reserves will invariably exit the bank. It’s entirely possible that the reserves will not leave the bank in the event all of his spending went to depositors at the same bank. If this were to occur, the outcome of the settlement/clearing of payments would be a decrease in the bank’s liability to our borrower and an increase in liabilities to payees so to speak. Most of the time, at least in my experience, most individuals or firms the borrower ends up making payments to are depositors at other banks. Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Let’s look at the first instance so I can tie it into your example. The borrower takes the $20,000 in cash. He spends the $20,000 in cash which is taken out of our bank’s vault when the loan was approved. Any of the businesses that receive his cash will ultimately make cash deposits at their banks at some point along the line. That cash ends up back in the vault at some bank and back in the banking system. The same would occur if our borrower spent by debit card, wire transfer or check. The clearing system mechanism will result in reserves shifting from our borrower’s bank into the reserve accounts of other banks.

 

[ShackledNation]

No you didn't.

How would you suggest the bank with $1 billion in excess reserves fund the loan for $500 million?

Look at that, the bank created a liability out of thin air.

Banks can't create liabilities out of thin air.
Except central banks.

You keep repeating your same assertion, but it is simply wrong. You can call a pear a mango for as long as you want, but a pear is still a pear.

Banks can and do create liabilities out of thin air. The liability is a demand deposit. Even I can create a liability out of thin air. I can give my friend a note saying IOU $10. Poof. I have a new liability.

Bank A has $100 in reserves and $100 deposits. Bank A then creates a $900 loan (and of course the $900 deposit account) for Bob. The $900 deposit is in the form of a check. Bob gives George the check. George goes to Bank A and deposits the check. Bank A debits $900 from Bob's account and credits $900 to George's account. Was cash ever deposited? No. Did the Fed ever credit the banks account? No. Well what was deposited? The $900 deposit the bank itself created out of thin air. Nothing is backing it but itself. There is no new deposit, the same deposit the bank created out of thin air merely changed hands.

Look at that, the bank created a liability out of thin air. It's called a demand deposit (or check). From now on, I will continue to repost it until you point out where in the example something illegal or impossible happened.

How would you suggest the bank with $1 billion in excess reserves fund the loan for $500 million?

Again my example answers that, and I have already answered that question directly numerous times. I give you the answer, then you ask the same question. I'm not going to play along with your circular reasoning--respond to my example, and what I have already answered.

 

[ShackledNation]

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets. We have a total net balance which is 0. There are also different methods to calculate the interest on the loan from an accounting perspective.

Most of the time the borrower will accept the loan into a bank account. The bank credits the borrower’s account for $20,000 which is a liability for the bank. The bank records the $20,000 loan as an asset, so we have a balance sheet of 0. In this first instance the balance sheet is 0 since the decrease in cash assets are offset by an increase in the loan assets. The second instance is also 0 since the increase in the bank’s assets are offset by an equal increase in the liabilities of the bank.

Even if our borrower accepts the loan amount as a checking account balance, as soon as he begins to make purchases, some reserves will invariably exit the bank. It’s entirely possible that the reserves will not leave the bank in the event all of his spending went to depositors at the same bank. If this were to occur, the outcome of the settlement/clearing of payments would be a decrease in the bank’s liability to our borrower and an increase in liabilities to payees so to speak. Most of the time, at least in my experience, most individuals or firms the borrower ends up making payments to are depositors at other banks. Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Let’s look at the first instance so I can tie it into your example. The borrower takes the $20,000 in cash. He spends the $20,000 in cash which taken out of our bank’s vault when the loan was approved. Any of the businesses that receive his cash will ultimately make cash deposits at their banks at some point along the line. That cash ends up back in the vault at some bank and back in the banking system. The same would occur if our borrower spent by debit card, wire transfer or check. The clearing system mechanism will result in reserves shifting from our borrower’s bank into the reserve accounts of other banks.

Exactly. And to add, only the difference at the end of the day shifts between accounts at the Fed. For example, if both Bank A and Bank B makes of $20,000, the businesses that receive Bank A's loan may deposit it into Bank B, the same for Bank A. The result is no movement of reserves at all at the Fed. Only what does not cancel out between banks is moved--a fall smaller sum. That is true regardless of if cash actually is deposited or if reserves never left the bank (ie the bank paid via check, or people paid with debit not cash, etc.)

 

[Toddsterpatriot]

Okay, so we're talking a 10K loan, then the borrower takes 5K in cash? I thought you meant the bank had 10k in deposits, he withdraws 5k cash. Remember, and you said you agree, loans create deposits, it's a fairly simply process. Banks only hold physical cash reserves to satisfy their customers demand for cash withdrawals.

Okay, so we're talking a 10K loan, then the borrower takes 5K in cash?

No. A bank has $10,000 in deposits. $5000 in vault cash, $5000 in an account at the Fed.

A guy comes in to borrow $5000, takes it in cash. What has the bank lent out?

A guy comes in to borrow $5000, takes it as a wire transfer. What has the bank lent out?

Banks rarely lend in such a fashion. We don't leave banks with wheelbarrows in tow. A bank will credit your deposit account, or they'll directly make a payment for you, such as your mortgage, the auto dealer, boat dealer, etc.

However, with that being said, you can certainly obtain an overdraft withdrawal, so you can leave with the cash in hand. In the event the bank was short of vault cash (also part of its reserves), you'd have to wait thirty days as a requirement for savings deposits, but banks almost never do that for an armored truck delivery from the Federal Reserve.

If the bank doesn't have enough reserves at the FED to cover an armored truck delivery, the FED will directly lend them the reserves. They'll give you the cash and the liability would be the reserves they owe to the FED.

Banking lending should be thought of as keystrokes, not as cash withdrawals. It doesn't matter since the FED will always lend out cash on demand.

Banks rarely lend in such a fashion.

Banks rarely send wires?

What about a check?

A bank with $10,000 in deposits.
Someone borrows $5,000. They write a check for $5,000.
The check clears. What did the bank lend?

A bank will credit your deposit account, or they'll directly make a payment for you, such as your mortgage, the auto dealer, boat dealer, etc.

Great, the bank pays the auto dealer. What did they lend?

 

[Toddsterpatriot]

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets. We have a total net balance which is 0. There are also different methods to calculate the interest on the loan from an accounting perspective.

Most of the time the borrower will accept the loan into a bank account. The bank credits the borrower’s account for $20,000 which is a liability for the bank. The bank records the $20,000 loan as an asset, so we have a balance sheet of 0. In this first instance the balance sheet is 0 since the decrease in cash assets are offset by an increase in the loan assets. The second instance is also 0 since the increase in the bank’s assets are offset by an equal increase in the liabilities of the bank.

Even if our borrower accepts the loan amount as a checking account balance, as soon as he begins to make purchases, some reserves will invariably exit the bank. It’s entirely possible that the reserves will not leave the bank in the event all of his spending went to depositors at the same bank. If this were to occur, the outcome of the settlement/clearing of payments would be a decrease in the bank’s liability to our borrower and an increase in liabilities to payees so to speak. Most of the time, at least in my experience, most individuals or firms the borrower ends up making payments to are depositors at other banks. Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Let’s look at the first instance so I can tie it into your example. The borrower takes the $20,000 in cash. He spends the $20,000 in cash which is taken out of our bank’s vault when the loan was approved. Any of the businesses that receive his cash will ultimately make cash deposits at their banks at some point along the line. That cash ends up back in the vault at some bank and back in the banking system. The same would occur if our borrower spent by debit card, wire transfer or check. The clearing system mechanism will result in reserves shifting from our borrower’s bank into the reserve accounts of other banks.

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets.

Yes, a decrease in vault cash is a decrease in reserves.

Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Yes, in both cases, reserves were lent. Thanks.

 

[Toddsterpatriot]

You keep repeating your same assertion, but it is simply wrong. You can call a pear a mango for as long as you want, but a pear is still a pear.

Banks can and do create liabilities out of thin air. The liability is a demand deposit. Even I can create a liability out of thin air. I can give my friend a note saying IOU $10. Poof. I have a new liability.

Bank A has $100 in reserves and $100 deposits. Bank A then creates a $900 loan (and of course the $900 deposit account) for Bob. The $900 deposit is in the form of a check. Bob gives George the check. George goes to Bank A and deposits the check. Bank A debits $900 from Bob's account and credits $900 to George's account. Was cash ever deposited? No. Did the Fed ever credit the banks account? No. Well what was deposited? The $900 deposit the bank itself created out of thin air. Nothing is backing it but itself. There is no new deposit, the same deposit the bank created out of thin air merely changed hands.

Look at that, the bank created a liability out of thin air. It's called a demand deposit (or check). From now on, I will continue to repost it until you point out where in the example something illegal or impossible happened.

How would you suggest the bank with $1 billion in excess reserves fund the loan for $500 million?

Again my example answers that, and I have already answered that question directly numerous times. I give you the answer, then you ask the same question. I'm not going to play along with your circular reasoning--respond to my example, and what I have already answered.

You admitted reserves were lent? That's good. Finally.

 

[Kimura]

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets. We have a total net balance which is 0. There are also different methods to calculate the interest on the loan from an accounting perspective.

Most of the time the borrower will accept the loan into a bank account. The bank credits the borrower’s account for $20,000 which is a liability for the bank. The bank records the $20,000 loan as an asset, so we have a balance sheet of 0. In this first instance the balance sheet is 0 since the decrease in cash assets are offset by an increase in the loan assets. The second instance is also 0 since the increase in the bank’s assets are offset by an equal increase in the liabilities of the bank.

Even if our borrower accepts the loan amount as a checking account balance, as soon as he begins to make purchases, some reserves will invariably exit the bank. It’s entirely possible that the reserves will not leave the bank in the event all of his spending went to depositors at the same bank. If this were to occur, the outcome of the settlement/clearing of payments would be a decrease in the bank’s liability to our borrower and an increase in liabilities to payees so to speak. Most of the time, at least in my experience, most individuals or firms the borrower ends up making payments to are depositors at other banks. Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Let’s look at the first instance so I can tie it into your example. The borrower takes the $20,000 in cash. He spends the $20,000 in cash which is taken out of our bank’s vault when the loan was approved. Any of the businesses that receive his cash will ultimately make cash deposits at their banks at some point along the line. That cash ends up back in the vault at some bank and back in the banking system. The same would occur if our borrower spent by debit card, wire transfer or check. The clearing system mechanism will result in reserves shifting from our borrower’s bank into the reserve accounts of other banks.

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets.

Yes, a decrease in vault cash is a decrease in reserves.

Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Yes, in both cases, reserves were lent. Thanks.

Banks lend out their own deposits which are basically keystrokes regardless of vault cash. Reserves aren't used as some ingredient for making loans.

We have to differentiate between an individual bank and the aggregate banking system in its entirety. It boils down to the FED's balance sheet and the mechanism of credit creation (how banks facilitate a loan). As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

In the aggregate, as I've said in this thread and other, banks cannot cannot decrease or increase their levels of excess reserves unless they store money in their vaults.

But yeah, an individual bank can offload their reserves, especially given the examples used.

 

[Kimura]

Here's a great paper by Paul Sheard of S&P:

Banks Cannot And Do Not "Lend Out" Reserves

 

[Toddsterpatriot]

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets. We have a total net balance which is 0. There are also different methods to calculate the interest on the loan from an accounting perspective.

Most of the time the borrower will accept the loan into a bank account. The bank credits the borrower’s account for $20,000 which is a liability for the bank. The bank records the $20,000 loan as an asset, so we have a balance sheet of 0. In this first instance the balance sheet is 0 since the decrease in cash assets are offset by an increase in the loan assets. The second instance is also 0 since the increase in the bank’s assets are offset by an equal increase in the liabilities of the bank.

Even if our borrower accepts the loan amount as a checking account balance, as soon as he begins to make purchases, some reserves will invariably exit the bank. It’s entirely possible that the reserves will not leave the bank in the event all of his spending went to depositors at the same bank. If this were to occur, the outcome of the settlement/clearing of payments would be a decrease in the bank’s liability to our borrower and an increase in liabilities to payees so to speak. Most of the time, at least in my experience, most individuals or firms the borrower ends up making payments to are depositors at other banks. Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Let’s look at the first instance so I can tie it into your example. The borrower takes the $20,000 in cash. He spends the $20,000 in cash which is taken out of our bank’s vault when the loan was approved. Any of the businesses that receive his cash will ultimately make cash deposits at their banks at some point along the line. That cash ends up back in the vault at some bank and back in the banking system. The same would occur if our borrower spent by debit card, wire transfer or check. The clearing system mechanism will result in reserves shifting from our borrower’s bank into the reserve accounts of other banks.

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets.

Yes, a decrease in vault cash is a decrease in reserves.

Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Yes, in both cases, reserves were lent. Thanks.

Banks lend out their own deposits which are basically keystrokes regardless of vault cash. Reserves aren't used as some ingredient for making loans.

We have to differentiate between an individual bank and the aggregate banking system in its entirety. It boils down to the FED's balance sheet and the mechanism of credit creation (how banks facilitate a loan). As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

In the aggregate, as I've said in this thread and other, banks cannot cannot decrease or increase their levels of excess reserves unless they store money in their vaults.

But yeah, an individual bank can offload their reserves, especially given the examples used.

Reserves aren't used as some ingredient for making loans.


Never said they were.

A bank with no excess reserves that lends $5000 will, once the loan proceeds are withdrawn, replace those reserves with new deposits or thru Fed Funds.

A bank with $10,000 in excess reserves, my example, which lends $5000 will, once the loan proceeds are wthdrawn, have lent excess reserves.

As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

Yes. Reserves lent by one bank will add to reserves at another, unless the loan was withdrawn, and held, as cash.

 

[Toddsterpatriot]

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets. We have a total net balance which is 0. There are also different methods to calculate the interest on the loan from an accounting perspective.

Most of the time the borrower will accept the loan into a bank account. The bank credits the borrower’s account for $20,000 which is a liability for the bank. The bank records the $20,000 loan as an asset, so we have a balance sheet of 0. In this first instance the balance sheet is 0 since the decrease in cash assets are offset by an increase in the loan assets. The second instance is also 0 since the increase in the bank’s assets are offset by an equal increase in the liabilities of the bank.

Even if our borrower accepts the loan amount as a checking account balance, as soon as he begins to make purchases, some reserves will invariably exit the bank. It’s entirely possible that the reserves will not leave the bank in the event all of his spending went to depositors at the same bank. If this were to occur, the outcome of the settlement/clearing of payments would be a decrease in the bank’s liability to our borrower and an increase in liabilities to payees so to speak. Most of the time, at least in my experience, most individuals or firms the borrower ends up making payments to are depositors at other banks. Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Let’s look at the first instance so I can tie it into your example. The borrower takes the $20,000 in cash. He spends the $20,000 in cash which is taken out of our bank’s vault when the loan was approved. Any of the businesses that receive his cash will ultimately make cash deposits at their banks at some point along the line. That cash ends up back in the vault at some bank and back in the banking system. The same would occur if our borrower spent by debit card, wire transfer or check. The clearing system mechanism will result in reserves shifting from our borrower’s bank into the reserve accounts of other banks.

A more relevant example: let’s say a bank customer borrows $20,000 and he takes it all in cash. The bank records a new loan worth $20,000, and simultaneously records a decrease of $20,000 in its cash assets.

Yes, a decrease in vault cash is a decrease in reserves.

Any bank settlements of the aforementioned payments will need a settlement between our two banks which will result in a wire transfer from the FED for reserve funds from our borrower’s bank to the other bank.

Yes, in both cases, reserves were lent. Thanks.

Banks lend out their own deposits which are basically keystrokes regardless of vault cash. Reserves aren't used as some ingredient for making loans.

We have to differentiate between an individual bank and the aggregate banking system in its entirety. It boils down to the FED's balance sheet and the mechanism of credit creation (how banks facilitate a loan). As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

In the aggregate, as I've said in this thread and other, banks cannot cannot decrease or increase their levels of excess reserves unless they store money in their vaults.

But yeah, an individual bank can offload their reserves, especially given the examples used.

In the aggregate, as I've said in this thread and other, banks cannot cannot decrease or increase their levels of excess reserves unless they store money in their vaults.

Ummm....turning reserves at the Fed into vault cash does not change levels of excess reserves, simply their form.

 

[Kimura]

Never said they were.

A bank with no excess reserves that lends $5000 will, once the loan proceeds are withdrawn, replace those reserves with new deposits or thru Fed Funds.

A bank with $10,000 in excess reserves, my example, which lends $5000 will, once the loan proceeds are wthdrawn, have lent excess reserves.

As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

Yes. Reserves lent by one bank will add to reserves at another, unless the loan was withdrawn, and held, as cash.

So then we agree. Loans create deposits which are backstopped by reserves after the fact. When a bank makes a loan, it creates liabilities which aren't related or connected to the reserve position of the bank.

 

[Toddsterpatriot]

Here's a great paper by Paul Sheard of S&P:

Banks Cannot And Do Not "Lend Out" Reserves

Thanks for the link.

Neither individual banks nor banks as a whole can "lend out" reserves, but individual
banks can and do offload their reserves (particularly excess reserves) by lending them to other banks or by buying
assets;

He sounds confused. LOL!

 

[Toddsterpatriot]

Never said they were.

A bank with no excess reserves that lends $5000 will, once the loan proceeds are withdrawn, replace those reserves with new deposits or thru Fed Funds.

A bank with $10,000 in excess reserves, my example, which lends $5000 will, once the loan proceeds are wthdrawn, have lent excess reserves.

As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

Yes. Reserves lent by one bank will add to reserves at another, unless the loan was withdrawn, and held, as cash.

So then we agree. Loans create deposits which are backstopped by reserves after the fact. When a bank makes a loan, it creates liabilities which aren't related or connected to the reserve position of the bank.

Loans create deposits

Of course.

which are backstopped by reserves after the fact.

After the fact could be seconds later.

When a bank makes a loan, it creates liabilities which aren't related or connected to the reserve position of the bank

And once those liabilities are withdrawn, the excess reserve position, whether vault cash or balance at the Fed, is reduced.

Reserves were lent.

 

[ShackledNation]

Never said they were.

A bank with no excess reserves that lends $5000 will, once the loan proceeds are withdrawn, replace those reserves with new deposits or thru Fed Funds.

A bank with $10,000 in excess reserves, my example, which lends $5000 will, once the loan proceeds are wthdrawn, have lent excess reserves.

As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

Yes. Reserves lent by one bank will add to reserves at another, unless the loan was withdrawn, and held, as cash.

So then we agree. Loans create deposits which are backstopped by reserves after the fact. When a bank makes a loan, it creates liabilities which aren't related or connected to the reserve position of the bank.

Its not worth it. Toddser will concede your argument, but then in the next post just restate the same erroneous argument that was just debunked by that concession.

 

[Toddsterpatriot]

Never said they were.

A bank with no excess reserves that lends $5000 will, once the loan proceeds are withdrawn, replace those reserves with new deposits or thru Fed Funds.

A bank with $10,000 in excess reserves, my example, which lends $5000 will, once the loan proceeds are wthdrawn, have lent excess reserves.

As I explained, any reserves that exit one bank's balance sheet will inevitably show up on the another bank's balance sheet all while remaining on the FED's balance sheet.

Yes. Reserves lent by one bank will add to reserves at another, unless the loan was withdrawn, and held, as cash.

So then we agree. Loans create deposits which are backstopped by reserves after the fact. When a bank makes a loan, it creates liabilities which aren't related or connected to the reserve position of the bank.

Its not worth it. Toddser will concede your argument, but then in the next post just restate the same erroneous argument that was just debunked by that concession.

You'll concede liabilities have to be larger than loans and in the next post pretend $100 in liabilities allows $900 in loans.

 

[Listening]

West Germany is doing pretty well. Semi socialist and investing in clean energy. Unions, National health care and all. I'll stop so you can get some garlic and a holy cross, maybe a wooden stake and a mallet too.

Have you heard that ed is such an economics expert that he was offered a full teaching job at a prestigious school?? First in the third grade of this elementary school. Problem was the students recognized that ed had no actual knowledge of any kind. So then, they put him in charge of an economics class for kinder garden students, but they too recognized that something was wrong with ed. Even they knew he was an impostor. Now, they are looking for a position as head of creative economics, but no one wants to attend the class. So they are looking at raiding US Messageboard for students. Cause there are enough ignorant about economics there to fill a class. And they love what ed has to say.

Many people I listen to who say they are conservatives don't have two cents to scratch their a*s with, and here's the funny part most of them don't even have health insurance, not because they choose not to have it, but because they can't afford it, or simply because they can't get it because of current state of health, and they still defend the system.......truly pathetic!!!

Yeah,

How sad that people put their ideals above themselves.

Good thing the founders were not that silly......oh, wait.

 

[EdwardBaiamonte]

West Germany is doing pretty well. Semi socialist and investing in clean energy.

Germany has always done well compared to socialist Europe thanks to their very severe militaristic attitudes about everything. But still they have a relatively low standard of living compared to the USA. THey are a little above Arkansas( about our poorest state) in their standard of living. Most importantly they are lucky. The have have 4 huge auto companies that supply the world with way over priced, high margin luxury cars. Without that they would about like France.