Unsettled Economy & The Bailout

[timkona]

Re: Unsettled Economy & The Bailout

TuNnL says For once, a post I agree with every word from Timkona

You stop that right now, Mister Man. Or Leo is gonna have to separate us.

It's funny. People always say there are two sides to every story. Truth is, there are probably way more than 2 sides.

[matapule]

Re: Unsettled Economy & The Bailout

The Senate appears to be prepared to pass essentially the same bill that was rejected by the House last Monday with the following changes

The plan for Wednesday night's vote was set after leaders there agreed to add tax breaks for businesses and the middle class and increase deposit insurance in an attempt to revive the legislation rejected by the House.

I am still adamently opposed to this bill. This is insane! This not the time for tax cuts. It is a time for tax increases. Apparently, there has been a marked increase in constituent approval for this revised bill. The taxpayer is so gullible. There is no such thing as free money. The millitary has just submitted the biggest budget ever. We cannot continue to spend federal dollars we don't have and expect that we will never have to pay the bill. There is a day of financial reckoning coming. I favor facing our financial problems now. NO BAILOUT AS PROPOSED, REVISED, AND REVISED AGAIN.

[GregLee]

Re: Unsettled Economy & The Bailout

I am still adamently opposed to this bill. This is insane! This not the time for tax cuts. It is a time for tax increases.

Right. Wall Street, the President, Congress have behaved irresponsibly and should be punished. What shall we do to them? Let's ruin the economy and have a depression -- that'll fix them.

[salmoned]

Re: Unsettled Economy & The Bailout

An economy built on ever-increasing, unpaid debts and obligations is broken already (no matter how many decades pass before a reckoning), just as an economy [and civilization] based on continual growth is broken and cannot be sustained in a finite system. We need a new vision and perhaps the best way to start is by allowing the old vision to collapse by way of it's own inherent flaws. In any case, clinging desperately to a fatally flawed model is not rational. Only when the losing players leave the table will space be available for new players, hopefully with new and sustainable strategies.

[Leo Lakio]

Re: Unsettled Economy & The Bailout

It's funny. People always say there are two sides to every story. Truth is, there are probably way more than 2 sides.

And now, I have to agree with Tim. But I've often said that there are multiple sides, that things are not always black or white. What Tim has called "cognitive dissonance."

[GregLee]

Re: Unsettled Economy & The Bailout

We need a new vision and perhaps the best way to start is by allowing the old vision to collapse by way of it's own inherent flaws. In any case, clinging desperately to a fatally flawed model is not rational.

And perhaps it isn't. Promoting economic collapse in the baseless hope that a system more to your liking would emerge is even less rational.

It's perfectly possible to grow our way out of this. We did, after all, have a budget surplus just a short time ago. Our troubles do not stem from some "fatally flawed model", but from electing a bunch of Republican dunderheads. Throw them out.

[salmoned]

Re: Unsettled Economy & The Bailout

Who suggested promoting economic collapse? I only suggested not supporting the losers. Anyone who bet on red when the ball fell in black shouldn't be rewarded by receiving their money back. If that leads to economic collapse, so be it. No one can or should assume the role of God without the wisdom and power necessary to pull it off. Who's deciding which institutions are 'too big to fail', who gets refunded their bad bets? "The sky is falling", so equality, fairness and justice be damned, eh? Let's protect the guilty at the expense of the innocent and let's do it fast, so the current administration has the reins on the largesse. "Let every prudent man who can pay his debts be charged to help [some of] those who can't or won't."

[Random]

Re: Unsettled Economy & The Bailout

Who suggested promoting economic collapse? I only suggested not supporting the losers. Anyone who bet on red when the ball fell in black shouldn't be rewarded by receiving their money back. If that leads to economic collapse, so be it. No one can or should assume the role of God without the wisdom and power necessary to pull it off. Who's deciding which institutions are 'too big to fail', who gets refunded their bad bets? The sky is falling, so equality, fairness and justice be damned, eh?

I don't think God had a role on this one. It's all man-made.

From an economist's expert opinion, what would the scenario be if Fannie Mae and Freddie Mac shut down? How would that affect other business's confidence in the American dollar? What will be the domino effect?

Personally, I don't WANT bailout any more than I WANT to pay tax. But I need to pay tax to keep our government running and in the hope that if I'm in a jam, there will be a government program to help me get back on my feet.

So, is the bailout a necessity for our economy on life-support?

[GregLee]

Re: Unsettled Economy & The Bailout

Anyone who bet on red when the ball fell in black shouldn't be rewarded by receiving their money back. If that leads to economic collapse, so be it.

This is a very well known strategic principle. It's called "cutting off your nose to spite your face."

[Frankie's Market]

Re: Unsettled Economy & The Bailout

An economy built on ever-increasing, unpaid debts and obligations is broken already (no matter how many decades pass before a reckoning), just as an economy [and civilization] based on continual growth is broken and cannot be sustained in a finite system.

If that is the case, maybe this day of reckoning was in the making ever since Nixon closed the Treasury Dept.'s gold window in 1971 and other countries quickly following suit. These manuevers effectively made all the world currencies fiat money. That is, money that is backed by nothing except the trust that people place in the govt. that has printed it.

We need a new vision and perhaps the best way to start is by allowing the old vision to collapse by way of it's own inherent flaws. In any case, clinging desperately to a fatally flawed model is not rational.

Interesting. So if we dump this "fatally flawed" system of floating fiat currency, then what? Go back to a fixed gold standard? Is that what you propose?

[salmoned]

Re: Unsettled Economy & The Bailout

Random, I never said God [or the gods] had a hand in this (although nothing falls outside Their purview), but rather that the government wants to assume the role of God in deciding who should and shouldn't be saved. A bailout has no guarantee of rescuing the economy or imbuing confidence in our financial markets and, in fact, would tend to negate the confidence that our financial system is fair and equitable (it would prove the system is ultimately rigged by the government to favor a select few).

GregLee, 'cutting off your nose to spite your face' is disregarding one's core values for an ephemeral expediency, exactly the scenario a bailout would entail. Refusing to bail anyone out is leaving your nose intact, despite disapproving of the behavior of your face. Response to below - Exactly! The bailout is a rash, unnecessary and self-destructive overreaction to the market's current financial problems. It will destroy any semblance of fairness and equity in the market.

FM, is it really necessary that I conceive and propose a better, workable alternative before I point out that the current system is fundamentally flawed? I don't pretend to have 'all the answers', never have, never will. Does that fact compromise the value of my observations in your mind?

[GregLee]

Re: Unsettled Economy & The Bailout

GregLee, 'cutting off your nose to spite your face' is disregarding one's core values for an ephemeral expediency, exactly what a bailout would entail.

http://www.phrases.org.uk/meanings/106875.html

Disadvantage yourself in order to do harm to an adversary.

http://en.wikipedia.org/wiki/Cutting...spite_the_face

Cutting off the nose to spite the face is an expression used to describe a needlessly self-destructive overreaction to a problem. "Don't cut off your nose to spite your face" is a warning not to act out of pique or pursue revenge in such a way as to damage yourself more than the object of your anger.

[turtlegirl]

Re: Unsettled Economy & The Bailout

My $.o2, for what its worth (which won't be much with today's inflation issues...)

It is absolutely unfair that the people and businesses which have conducted themselves prudently and responsibly for the past several years should be forced to help the people and businesses who have conducted themselves irresponsibly, at best and illegally, at worst. This 'curved grading system',for lack of a better analogy, totally disgusts me.

Anyone remember the story of the grasshopper and the ant, from small kid time?

Synopsis from Wikipedia...
"The fable concerns a grasshopper who has spent the warm months singing away while the ant (or ants in some editions) worked to store up food for winter. After the winter has come, the grasshopper finds itself dying of hunger, and upon asking the ant for food is only rebuked for its idleness. The story is used to teach the virtues of hard work and saving, and the perils of improvidence. Some versions of the fable state a moral at the end, along the lines of:
Idleness brings want To work today is to eat tomorrow It is best to prepare for the days of necessity "

Yeah. But thats only part of it. More commentary later....

[matapule]

Re: Unsettled Economy & The Bailout

And perhaps it isn't. Promoting economic collapse in the baseless hope that a system more to your liking would emerge is even less rational.

There is no certainty that there will be "economic collapse" if a bailout isn't passed. Playing the economy fear card is much like Bush did when he said Iraq had weapons of mass destruction, to scare people into a war without end. In my opinion, this proposal is nothing more than putting off the inevitable - paying for an economy based on credit that will be difficult to repay without massive taxes or a drastic cut in services.

It's perfectly possible to grow our way out of this.

This is the classic Republican economic model that got us into trouble in the first place. Growth is not good unless we can pay for it as we grow. I am a fiscal conservative, and it is now time to start paying off our federal credit card. Increased taxes and/or cuts in services, which way do you want it?

We did, after all, have a budget surplus just a short time ago. Our troubles do not stem from some "fatally flawed model", but from electing a bunch of Republican dunderheads. Throw them out.

Actually the current round of financial institution deregulation occurred late in the Clinton Administration. The Dems are just as much to blame as the Reps. I guess you are going to vote for Obama?

So Greg, care to share with us what kind of work you are in? I'm retired.

[GregLee]

Re: Unsettled Economy & The Bailout

Response to below - Exactly! The bailout is a rash, unnecessary and self-destructive overreaction to the market's current financial problems. It will destroy any semblance of fairness and equity in the market.

No, you've got it backwards. Consider this example from the Wikipedia article I quoted above:

For example, if a man were angry at his wife, he might burn down their house to punish her. Of course, this would be an example of cutting off his nose to spite his face, as in the process of burning down her house he would also be destroying his home, along with all his personal possessions.

The "house" is our economy which you are willing to see collapse to preserve "fairness and equity", never mind that you and I will also be harmed when the house burns.

FM, is it really necessary that I conceive and propose a better, workable alternative before I point out that the current system is fundamentally flawed? I don't pretend to have 'all the answers', never have, never will. Does that fact compromise the value of my observations in your mind?

Yes it does, because you are recommending against a specific measure to rescue credit markets from collapse when there is no alternative proposal on the table. Congress does not have the option of voting on your favorite alternative proposal -- there is no such bill before it.