brainsee
Active Member
- Jan 25, 2024
- 300
- 65
- 43
- Thread starter
- Banned
- #101
You apparently don't understand the difference between a recession and a depression. What you mention about stocks was one of the causes of the recession. It didn't become a depression until later, but I guess you're unwilling to listen to the various economists of all persuasions that agree that the tariff caused the worsening of the situation. It's one of the few things that Keynesians and Austrians can agree on.
The repeal of the Glass-Steagall Act was essentially redundant. By the late 90s, the Federal Reserve Board was allowing all sorts of merges between investment and commercial banking.
There are 2 things you can blame the banks for that are independent of government. First, banks were selling CDOs that were leveraging absurd amounts of toxic assets.
Were Collateralized Debt Obligations (CDO) Responsible for the 2008 Financial Crisis?
Collateralized debt obligations are exotic financial instruments that can be hard to understand. Learn the role they played in the 2008 financial crisis.www.investopedia.com
Second, they were paying off ratings agencies to rate instruments and securities as being higher quality than they actually were.
Credit rating agencies and the subprime crisis - Wikipedia
en.wikipedia.org
So, should we regulate CDOs and Credit rating agencies better? Sure. But the question is, how? There's a revolving door between the banking industry and the people who are supposed to regulate it.
This is all a pretty good break away from what this thread was originally about. But seeing as how we are here, let's talk about the great depression. Obviously, it was something quite different from a recession. Stocks back then took a nose dive. And then kept falling from there. Despite the government's attempts to shore it up. From there, what would any tariff do. Cause Americans to buy things made in America. Thereby basically keeping our money here. It may not have been great for other economies. But that was their problem. Still, we went into a depression. The only way out of it for FDR was to start a war. Which he did.
As for the Glass-Stegall act, obviously it wasn't redundant. It was put into place to prevent the same sort of shenanigans that caused the great depression. But it was just another of those regulations that republicans are so fond of repealing to make the wealthy more money. Though from what I was reading, some of the regulations of the Glass-Stegall act were kept in place. But apparently, not enough to keep from screwing things up again.
You also speak of some of the problems that were caused in the 2008 housing fiasco. But to me the biggest problem was in bailing out the banks. Giving those banks the money to buy out other banks. Making themselves "too big to fail." Though you do make an excellent point, One that I have been aware of for a long time. Which is the revolving door between government and big business. I was watching an interview of a politician in Washington once who was honest about it. He said, "There is so much legal graft that goes on in Washington that only a fool would get involved in the illegal kind."