Are you worried about the economy?
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Re: Actually, no ...
But I'm still hoping Obama keeps his word on equalizing trade. The Big 3 has to make cars in China to sell in China, but it's very unequal the other direction. Reagan actually did that to Japanese auto makers in the '80s, forcing them to actually build plants in the US.
The government is not the main cause of the recession. Partly, but not mostly. Banks are to blame also.
But it's the consumer's fault mostly. Specifically the one's that bought a house they couldn't afford with income they didn't have to fuel a housing boom that wasen't real (it was all speculation). Then after their homes boomed, instead of realizing their gains, they took out more debt to renovate their homes and buy big RV's and max out their credit cards all the while realizing that if the real estate boom ever went bust, they'd be fucked.
They got greedy. They made stupid decisions and now they (and millions more) are gonna pay for it.
Yes governments and banks are guilty. But no one put a gun to the consumer's heads to get SO FAR into debt. Greed did that.
But it's the consumer's fault mostly. Specifically the one's that bought a house they couldn't afford with income they didn't have to fuel a housing boom that wasen't real (it was all speculation). Then after their homes boomed, instead of realizing their gains, they took out more debt to renovate their homes and buy big RV's and max out their credit cards all the while realizing that if the real estate boom ever went bust, they'd be fucked.
They got greedy. They made stupid decisions and now they (and millions more) are gonna pay for it.
Yes governments and banks are guilty. But no one put a gun to the consumer's heads to get SO FAR into debt. Greed did that.
As I always say ...
As I have been warning for years, "buyer beware" is something we Libertarian-Capitalists say. There is no such "safety net," and never will be, for buying what you cannot afford. The only alternative is for the government to restrict your freedom to buy anything!
But Governments let the banks do this by relaxing regulations.Particularly in the UK where we got into a ridiculous situation in the housing market.Banks were prepared to lend insane amounts with the result that more money was chasing the same housing stock.I laughed when I saw a post mentioning a $180 000 house.This would just about buy a dog kennel here but wouldn't pay for a door to it as well.
The US Federal government OWNS (essentially) our banking system ...
Hell, even Bill Clinton has "come around" on that, and defended aspects of the system, while criticizing others. I admire Bill Clinton for taking some of the blame too, although he was hardly the only person (and in the middle of a bad trend, also brought on by both Democrat, then Republican Congresses).
What we need is an exit of federal government control from our banking systems, other than to centralize the monetary unit (I do not believe in US states having their own currency). While I agree with many theories of Alexander Hamilton, and many have shown to be true, I disagree with a strong, central, federal bank. I believe more in the views of Thomas Jefferson and Andrew Jackson, even if I disagree with their views on a few other things.
Regulation on capitalism does not work when you don't have capitalism in the first place. As we Libertarian-Capitalists have long argued, we do not have capitalism -- from banks to health care to unions. We have federal controlled and/or mandated systems, with penalties levied against many people who actually go "outside the system" and use "free market/choice."
We American Libertarian-Capitalists would heavily disagree. It's government involvement in the banking system that has caused this in the first place, not "lack of regulation." The US Federal government and, indirectly, the UK government, has "control" of our banking system. Please read up on the Federal Reserve. There are countless lessons of this from the Great Depression, including people who believe the simplistic Keynesian non-sense (that is over-taught in our schools), and those who recognize that we haven't had capitalism for a long time.
Hell, even Bill Clinton has "come around" on that, and defended aspects of the system, while criticizing others. I admire Bill Clinton for taking some of the blame too, although he was hardly the only person (and in the middle of a bad trend, also brought on by both Democrat, then Republican Congresses).
What we need is an exit of federal government control from our banking systems, other than to centralize the monetary unit (I do not believe in US states having their own currency). While I agree with many theories of Alexander Hamilton, and many have shown to be true, I disagree with a strong, central, federal bank. I believe more in the views of Thomas Jefferson and Andrew Jackson, even if I disagree with their views on a few other things.
Regulation on capitalism does not work when you don't have capitalism in the first place. As we Libertarian-Capitalists have long argued, we do not have capitalism -- from banks to health care to unions. We have federal controlled and/or mandated systems, with penalties levied against many people who actually go "outside the system" and use "free market/choice."
And "regulation" would have solved that? I think people are looking past the "root cause." They are also not looking at the other issues involved.
Re: The US Federal government OWNS (essentially) our banking system ...
Certainly regulation would have helped. Banks were lending money they didn't have to people who couldn't afford to repay.Regulation would have prevented this nonsense from happening.
When I bought my house no lender would advance more than 2 1/2 times my annual income.It would not take into account my wife's wages except in a small way.Everybody else was treated the same.The result was that prices kept reasonable and I could afford to buy it without any great hardship.
Then the lenders relaxed the rule, or were allowed to.They were prepared to lend more and more because as long as there was collateral they were happy-in default they could get their money back by repossession.What happened of course is that suddenly more money was chasing the same houses.Prices rose sharply , so much that many people saw buying them as good investments which pushed the prices up even higher.The final straw is that lenders tried lending 120% of the house value , speculating on further rises to enable them to recover by repossession.
So we had a boom fuelled by debt , house owners felt asset rich although repayments were difficult and most young people just couldn't afford to leave home.And the chickens have come home to roost.
We American Libertarian-Capitalists would heavily disagree. It's government involvement in the banking system that has caused this in the first place, not "lack of regulation." The US Federal government and, indirectly, the UK government, has "control" of our banking system. Please read up on the Federal Reserve. There are countless lessons of this from the Great Depression, including people who believe the simplistic Keynesian non-sense (that is over-taught in our schools), and those who recognize that we haven't had capitalism for a long time.
Hell, even Bill Clinton has "come around" on that, and defended aspects of the system, while criticizing others. I admire Bill Clinton for taking some of the blame too, although he was hardly the only person (and in the middle of a bad trend, also brought on by both Democrat, then Republican Congresses).
What we need is an exit of federal government control from our banking systems, other than to centralize the monetary unit (I do not believe in US states having their own currency). While I agree with many theories of Alexander Hamilton, and many have shown to be true, I disagree with a strong, central, federal bank. I believe more in the views of Thomas Jefferson and Andrew Jackson, even if I disagree with their views on a few other things.
Regulation on capitalism does not work when you don't have capitalism in the first place. As we Libertarian-Capitalists have long argued, we do not have capitalism -- from banks to health care to unions. We have federal controlled and/or mandated systems, with penalties levied against many people who actually go "outside the system" and use "free market/choice."
And "regulation" would have solved that? I think people are looking past the "root cause." They are also not looking at the other issues involved.
Certainly regulation would have helped. Banks were lending money they didn't have to people who couldn't afford to repay.Regulation would have prevented this nonsense from happening.
When I bought my house no lender would advance more than 2 1/2 times my annual income.It would not take into account my wife's wages except in a small way.Everybody else was treated the same.The result was that prices kept reasonable and I could afford to buy it without any great hardship.
Then the lenders relaxed the rule, or were allowed to.They were prepared to lend more and more because as long as there was collateral they were happy-in default they could get their money back by repossession.What happened of course is that suddenly more money was chasing the same houses.Prices rose sharply , so much that many people saw buying them as good investments which pushed the prices up even higher.The final straw is that lenders tried lending 120% of the house value , speculating on further rises to enable them to recover by repossession.
So we had a boom fuelled by debt , house owners felt asset rich although repayments were difficult and most young people just couldn't afford to leave home.And the chickens have come home to roost.
Prof: while i'm not really an economic expert, i'm aware that in Canada (which is, as you know, a very socialised liberal democracy), the federal governement regulate banks more than in UK and USA. And we are less touched by the recession. While i don't want to defend governement regulation, i just understand that it is possible (maybe not desired) to set a system of rules for the banks and the results could be good.
You see what i mean? Bad decisions (or regulation system) by a federal governement is a disaster, a bomb awaiting to explode - as much as good decisions (or regulation system) by a federal governement can be a true benefit for ctitizens. Again, im using Canada as an example where the system in place seems to streighten our economy overall, even in rough times.
It's more a question than an affirmation.
Again, im out of my field when i speak about economy. And i have noticed many posters who are obviously more knowledgeful than I in this thread. Feel free to correct me if i'm wrong
You see what i mean? Bad decisions (or regulation system) by a federal governement is a disaster, a bomb awaiting to explode - as much as good decisions (or regulation system) by a federal governement can be a true benefit for ctitizens. Again, im using Canada as an example where the system in place seems to streighten our economy overall, even in rough times.
It's more a question than an affirmation.
Again, im out of my field when i speak about economy. And i have noticed many posters who are obviously more knowledgeful than I in this thread. Feel free to correct me if i'm wrong
Yes, they did. But the final responsibility has to be the consumer. They aren't children. They are adults. And they knew that these ridiculous mortgages they were being offered by these desperate mortgage brokers would be unsustainable once the original terms ended in a few years and their payments would skyrocket. They knew that if the real estate market started contracting (which obviously it eventually would) that they WOULD have to default. But instead of being sensible, many got greedy and got more and more into debt to buy renovations, cars, boats, RV's, etc. using their homes as collateral. All the while knowing that if (when) the housing market contracted, they were fucked.
They knew the risks and chose to ignore them. The fault is mostly (though not entirely) theirs.
The government and banks were self serving and morally corrupt, yes. When are they ever not? That they are self serving should be a given.
Why not totally absolving the people that bought homes when it was a bad decision you have to remember a lot of Joe Averages out there are not financial experts or even financially savvy. When a lot of monetary institutions started trying to actively sell them on the bad loans they did I'm sure a lot of them thought it was a better deal than they were really getting just by the actions of banks and other entities. That would be trying to say a drug pusher isn't responsible for somebody they got hooked on drugs. People have an ultimate responsibility for their actions, but that doesn't mean nobody else had a hand in it.
As far as which is better; more or less regulation. I am not sure. Though I tend to think Austrian (free market) economics with government safety nets for the poor/sick is the way to go.
But what I strongly object to is government's using free market or socialistic policies whenever it suits them.
Free market economics (along with government meddling) created the sub-prime mess. And if the government's just let the economies go into recession for a year or 18 months and correct itself; all the while helping those that cannot help themselves; then things would work themselves out.
But no. Governments encouraged people to spend and spend through free markets. Now they embrace socialistic economics by imposing gigantic tax burdens on their children/grandchildren to try and spend their way out of a recession with government bailouts.
Pick one or the other, politicians. Don't flip-flop whenever it suits you. That's a recipe, imo, for long term, economic disaster.
But what I strongly object to is government's using free market or socialistic policies whenever it suits them.
Free market economics (along with government meddling) created the sub-prime mess. And if the government's just let the economies go into recession for a year or 18 months and correct itself; all the while helping those that cannot help themselves; then things would work themselves out.
But no. Governments encouraged people to spend and spend through free markets. Now they embrace socialistic economics by imposing gigantic tax burdens on their children/grandchildren to try and spend their way out of a recession with government bailouts.
Pick one or the other, politicians. Don't flip-flop whenever it suits you. That's a recipe, imo, for long term, economic disaster.
That's my point. Let the buyer beware.
I have lost (and made) lots of money over the years on real estate and stock speculation. And lots of salespeople, middlemen, bankers, stock brokers, etc. told me bad or unrealistic information to their benefit and often, my detriment. And they will have to answer for their own karma.
But the bottom line is it's my responsibility. I knowingly and voluntarily entered into an economic agreement on a subject I did not know much about. And so did these consumers.
And I take full responsibility for my losses.
And so should they.
Imo, Ignorance is a reason, but it's not an excuse; especially in law or in business.
concerned forsure!!! but lets wait till 2009, new president, new year, i think that if we don't see a significant turn around in 2009 then we'll have a serious problem on our hands, not that we don't already, but you know what i'm saying. Renee
A post from an OCSM with a strikingly beautiful face in the 'Are you worried about the economy' thread?
I love it!
UP to a point and no more.People needed somewhere to live and had to pay the going price.They also saw house prices rising steadily and they didn't want to delay purchase and then see prices out of reach.That way they would never get on to the housing ladder.They also thought that their house would soon rise in value which would offset their repayments.
The banks were driving this by lending money they didn't even have.
Why are you all worried for them? They'll get bailout money.
Fannie Mae and Freddie Mac have already pledged to help those that are in danger of default with payment assistance.
Many of the consumers and banks that fucked up will get government money. And all those consumers and businesses that handled their finances shrewdly will get nothing. And the tax dollars to pay the former will mostly come from the latter.
Ridiculous.
Any idiot that bought a house, took out 3 mortgages on it to buy RV's, Harley's, etc. and lost it all gets little sympathy from me.
Didn't make it clear , I was meaning the UK situation. House prices in the US are I believe very much lower indeed although in both countries there is wide variation.
Now it's started, just like I thought. A report in USA Today says that U.S. homeowners are deliberately missing payments so they can qualify for government money which is only available to those in danger of foreclosure.
Bloody moronic bailout. Reward the weak. Punish the strong. Nuts.
Bloody moronic bailout. Reward the weak. Punish the strong. Nuts.
But the mess has been made. I have no sympathy or interest in hearing "Free Market" people who caused this mess tell me that we should "let the market sort it out" and that we will still have a functioning nation if we do. A market in absence of regulation is the problem. We haven't addressed the regulation side yet. We need to shred Gramm-Utley, return the "uptick" rule, and maybe go so far as legislate caps on CEO pay. I find is sickening to read about all these Wall St demons who are trying to secure their 2008 bonuses
Yeah, you sure earned that bonus Mr CEOSimilar threads
