Economic Crisis, What are the causes?

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Economic Crisis, What are the causes?

Here's what I think are the main causes of the Crisis. Curious to know what others think.

1. Government policy of making mortgages available to people who could not afford them. To solve the fact that some people could not afford to live in expensive homes, the government created Freddy and Fanny and manipulated interest rates to make them affordable. In the end all this did was drive up the price of homes making them even more expensive and causing an overbuilding of homes during the housing bubbles.

2. Government allowing uncollateralized insurance contracts. High risk mortgages were sold as low risk investments because they had default insurance through companies through AIG and others. Capitalism or any system can not work unless parties to a contract can prove they can fulfill the terms of the contract. AIG and investment banks did not have collateral to cover their insurance policies, so they should not have been allowed to issue insurance.

3. 401k tax breaks. The government encouraged investment in the stock market through deferred tax breaks. All this did was artificially drive up the price of stocks. Too much money chasing after too few good investments. Too many investors disconnected from the operation of the company with no management oversight.

4. Home Mortgage Interest deduction. People overbought housing and borrowed tons of money as means of reducing the burden from the unfair income tax system.

5. Deferred Employee Compensation. Companies like GM and the California government making long term commitments to employees to cover their pensions and health care for life. Cash should be paid to employees who make their own retirement/health care decisions. The Union system has failed both the workers and companies.

6. Encouragement of lending. The lending industry is simply a way for the rich to get richer without work and the working poor to remain their slave. It should not be 'vital' to our economy, it needs to be discouraged and regulated as much as possible. No more bailouts.

7. Failure fix economic disparity. The fact is there is a wide gap in demand/supply in services among our workers. This problem must be solved and not a redistribution of wealth through socialism and income high taxes.

8. The Fed. The Federal Reserve was continually changing interest rates and money supply. Along with being an illegal tax and being unaccountable to the taxpayers/citizens, it created volatile conditions and bubbles. Strong economies need stability and some predictability, they need to stop continually manipulating the market and give us stability.

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I think this clip explains a

I think this clip explains a large part of the economic crisis. 

 

www.crisisofcredit.com

 

Responsibility: A detachable burden easily shifted to the shoulders of God, Fate, Fortune, Luck or one's neighbor. In the days of astrology it was customary to unload it upon a star. ~Ambrose Bierce, The Devil's Dictionary, 1911


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Quote:Economic Crisis, What

Quote:
Economic Crisis, What are the causes?

 

Chronic stupidity.

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pauljohntheskeptic
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 A combination of chronic

 A combination of chronic stupidity in the mortgage markets as well as greedy options traders driving oil prices to sky high levels.

In Orlando the following occurred: 

Gas prices began to rise to new levels in early 2004.  It got to the point if a dolphin cut a fart in the Gulf of Mexico prices would rise $5 a barrel. As an owner of a service type retail establishment, tanning salons, I first noticed a drop off of blue-collar type customers such as waitresses and restaurant help in early 2004. Following 3 hurricanes in the Summer of 2004 a mass exodus of persons occurred from Orlando. These people had mortgages in the under $100,000 range and were paying $600-800 a month. As home values soared the new owners had new mortgages in the $250,000 range and payments over $2000 a month. These people had no disposable income to spend and did not come to spend it with me. In the meantime oil started a faster increase approaching $3.00 plus per gal of gas by the end of 2007.

Also during this period I as a Notary Public in Florida was a signing agent closing mortgages and making from $100 to $200 on each loan closing. I was only the witnessing person and not responsible for any of the transaction. One California lady I remember was in Orlando at a seminar on how to make money in real estate trading bought and sold 10 properties in one week. She was using the same seed money to do this a likely illegal transaction. I'm sure she got caught holding several properties including one in Punta Gorda that got trashed from Hurricane Charlie. Based on the loans I closed for several mortgage companies from various states there was a lot of this speculation going on from greedy real estate traders.

As the local economy began to reflect less spending on the retail level more and more small businesses began to fail and expenses continued to rise. Suddenly everything fell apart and nobody knows why. Yeah right.

Exc in your speculation on what occurred you don't seem to even notice what the oil, gas, and real estate speculators did. Energy is involved in everything and as option traders pushed levels even higher and higher it should have been very clear that people would divert money from other areas. You seem to blame government for all of it which may have some basis for lack of action way back in 1973-74 for failure to follow through after the Arab Oil Embargo. But commodity traders also bear part of the responsibility for the eventual destruction of the world-wide economy.

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EXC wrote:1. Government

EXC wrote:
1. Government policy of making mortgages available to people who could not afford them.

Someone correct me if I am wrong here. Is this referring to the legislation that prevents banks to deny loans on the basis of race, religion, gender etc? They are still very free to deny loans on the basis that the applicants can't afford the mortgage payments.


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KSMB wrote:EXC wrote:1.

KSMB wrote:

EXC wrote:
1. Government policy of making mortgages available to people who could not afford them.

Someone correct me if I am wrong here. Is this referring to the legislation that prevents banks to deny loans on the basis of race, religion, gender etc? They are still very free to deny loans on the basis that the applicants can't afford the mortgage payments.

Yep, that's the basic Free Market devotee's argument - blame minorities instead of greedy brokers and lenders.  It's brilliant PR, but not linked to reality.

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anniet wrote:KSMB wrote:EXC

anniet wrote:

KSMB wrote:

EXC wrote:
1. Government policy of making mortgages available to people who could not afford them.

Someone correct me if I am wrong here. Is this referring to the legislation that prevents banks to deny loans on the basis of race, religion, gender etc? They are still very free to deny loans on the basis that the applicants can't afford the mortgage payments.

Yep, that's the basic Free Market devotee's argument - blame minorities instead of greedy brokers and lenders.  It's brilliant PR, but not linked to reality.

That is wrong. EXC was talking about how interest rates were driven down to encourage loans. Clinton wanted more people to own homes despite the fact that they couldn't afford them. This has nothing to do with anti-discrimination laws. Nice try with the attempt to paint EXC as a racist though. Rather than bothering to argue with him, why don't you just make false accusations of racism instead.

If you want an example of what EXC was probably referencing: look into the Community Reinvestment Act. It forced regulated banks to give loans to people in poor neighborhoods. Rather than letting the bank decide if a loan is a good idea or not, this Act threatened banks with punishment if they didn't give loans to people who were unlikely to pay the bank back. If you coerce banks into handing out loans that they think are risky, then they will lose that money. Also, some economists claim that CRA pressured banks into subprime lending.

So no, this isn't racism, this is economic sense. Nice try with the attempt to avoid arguing by labeling your oppent as a racist though.

"You say that it is your custom to burn widows. Very well. We also have a custom: when men burn a woman alive, we tie a rope around their necks and we hang them. Build your funeral pyre; beside it, my carpenters will build a gallows. You may follow your custom. And then we will follow ours."
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But nobody forced the banks

But nobody forced the banks to make loans with no income verification. The problem wasn't really poorer people being unable to pay their mortgages. It was middle class people taking out much larger mortgages than they could afford.

Banks knew that loans were being made that people couldn't possibly afford. But they thought they'd be clever and bundle up hundreds or thousands of mortgages into a single security. If some of the loans went bad, the risk would be spread out over the rest of the mortgages, making any individual default largely inconsequential. Kind of like a mutual fund - owning shares of 30 stocks is a lot less risky than owning one.

However, you can never underestimate the truth of "garbage in, garbage out". The banks didn't take into account that by having essentially zero control over the quality of the loans being made, the default rate would be much higher than they were estimating.

 

 

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Jormungander wrote:anniet

Jormungander wrote:

anniet wrote:

Yep, that's the basic Free Market devotee's argument - blame minorities instead of greedy brokers and lenders.  It's brilliant PR, but not linked to reality.

That is wrong. EXC was talking about how interest rates were driven down to encourage loans. Clinton wanted more people to own homes despite the fact that they couldn't afford them. This has nothing to do with anti-discrimination laws. Nice try with the attempt to paint EXC as a racist though. Rather than bothering to argue with him, why don't you just make false accusations of racism instead.

If you want an example of what EXC was probably referencing: look into the Community Reinvestment Act. It forced regulated banks to give loans to people in poor neighborhoods. Rather than letting the bank decide if a loan is a good idea or not, this Act threatened banks with punishment if they didn't give loans to people who were unlikely to pay the bank back. If you coerce banks into handing out loans that they think are risky, then they will lose that money. Also, some economists claim that CRA pressured banks into subprime lending.

So no, this isn't racism, this is economic sense. Nice try with the attempt to avoid arguing by labeling your oppent as a racist though.

I wasn't thinking of racism as I don't remember seeing EXC write racist things.  I was thinking of him spending too much time listening to the Republican talking points on the economy.  I definitely could have worded my response better though.  EXC, I do apologize for inferring that you may be racist as that was not my intent.  You did not use that part of the myth the Republicans have created.  It was my intent to call you on ignoring the overwhelming responsibility of the private sector in this debacle. 

The collapse in the housing market was caused by greedy brokers, bankers, and those buying the houses.  I don't have time for an extensive search for links right now, but I will give you this:

http://www.rgemonitor.com/economonitor-monitor/225262/editors_pick_fed_did_not_feed_the_housing_bubble

 

"Congress passed the Community Reinvestment Act in 1977, requiring banks “to lend throughout the communities they serve.” In the 1990s, greater mortgage lending to lower-income households by CRA-coveed banks increased the homeownership rate for lower-income and minority families. As CAP scholar Tim Westrich has written, “The real culprits in the mortgage mess are non-bank mortgage companiesnot covered by CRA — that originated the lion’s share of bad mortgages at the heart of the crisis. They made an estimated 50 percent of subprime loans in 2005.” "

from http://thinkprogress.org/2008/12/09/myth-fannie-freddie/

emphasis added - It was the private sector led by profits to be made from closing on loans and refinancing that led to this bubble, not the CRA.  BTW, you are showing willful ignorance of the way the Republicans have used race in conjuction to the CRA myth they have created as lower income = higher level of minority representation. 

 

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anniet wrote:I wasn't

anniet wrote:

I wasn't thinking of racism as I don't remember seeing EXC write racist things.  I was thinking of him spending too much time listening to the Republican talking points on the economy.  I definitely could have worded my response better though.  EXC, I do apologize for inferring that you may be racist as that was not my intent.  You did not use that part of the myth the Republicans have created.  It was my intent to call you on ignoring the overwhelming responsibility of the private sector in this debacle. 

I see. I apologize then. I thought you were trying to smear him as a racist merely because he holds some right wing economic stances.

As for the private sector: they share equal responsibility in this matter. Poor people shouldn't have taken on loans they couldn't pay back, the federal government shouldn't have worked to increase the number of people who own homes (a nice goal, but some people just can't afford homes, manipulating the market to get them to make purchases they can't afford actually hurts them) and the private sector did a variety of stupid things to help get us where we are (they went nuts with their dept to capital ratios, they gave out loans to people who couldn't pay them back and then lost a lot of money from their stupidity).

 

 

anniet wrote:

you are showing willful ignorance of the way the Republicans have used race in conjuction to the CRA myth they have created as lower income = higher level of minority representation.

I'm still calling BS on this one. I get it that poor people who are risky to give loans to are mostly black or latino. But it is not racist for a Republican to state that many poor people can not be given home loans without the banks losing money in the process. I think that you are looking for racism when it isn't really there. I mean, come on: 'poor people usually can't pay off home loans when the price of homes is artificially inflated' is not code for "the blacks don't deserve homes, whites should be the ones who own property.' Don't look to hard for implied racism.

 

And just one small thing that got to me: surely you weren't calling Republicans free market devotees? The Republican party has abandoned all support for right wing economics. At this point I see them as being just as bad as the Democrats on economic matters. The Republicans like occasional free market rhetoric, but they never follow through and actually support the free market. They perfer to give government support to their friends in industry rather than allowing the market to determine who succeeds and who loses. I just can't accept any claims that the Republicans are free market devotees any more than I would accept a claim the the Democrats are communism devotees. The Republicans have sold us out on economic matters.

"You say that it is your custom to burn widows. Very well. We also have a custom: when men burn a woman alive, we tie a rope around their necks and we hang them. Build your funeral pyre; beside it, my carpenters will build a gallows. You may follow your custom. And then we will follow ours."
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econgineer wrote:I think

econgineer wrote:

I think this clip explains a large part of the economic crisis. 

 

www.crisisofcredit.com

 

So, the Fed in it response to 9/11 lowers interest rates to 1% creating the bubble and now the crash. So, the 9/11 attacks may yet succeed in bringing down western civilization. Islam is insane, but one thing it has going for it is prohibitions on lending. Our insane obsession with credit will ruin our society.

“Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful.” Seneca


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Jormungander wrote:As for

Jormungander wrote:

As for the private sector: they share equal responsibility in this matter. Poor people shouldn't have taken on loans they couldn't pay back, the federal government shouldn't have worked to increase the number of people who own homes (a nice goal, but some people just can't afford homes, manipulating the market to get them to make purchases they can't afford actually hurts them) and the private sector did a variety of stupid things to help get us where we are (they went nuts with their dept to capital ratios, they gave out loans to people who couldn't pay them back and then lost a lot of money from their stupidity).

I think it's ridiculous to expect low income people not to take money thrown at them. Government policy and failure to regulate was the main problem. White guilt played a role in creating the CRA. The Fed, presidents and congress had the goal of making everyone a 'homeowner'. The measured economic success in terms of percentage of people with a mortgage.

P.S. I'm not a Republican or racist, I want to rationally understand how things work. You can't create wealth out of nothing. The government tried to create wealth for poor people by getting them into homes when they didn't produce any wealth. You have to fix this problem first. You can't wave a magic wand and make everyone a homeowner.

“Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful.” Seneca


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Causes? i can some them up

Causes? i can some them up in 3 words

 

Idiocy

Greed

Cowardice


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The cause me , you your

The cause me , you your parents your kids  the man in the street ie the public

Humanity buys stuff it hasnt earned, forms companies based on selling it, elects poltiicans based on keeping the process going.

Call it greed, call it capitalism call it ,human nature doesnt really matter but I do know one thing problems in society, all problems  begin at the bottom with you and me. Blaming governments and politicans is just one big cop out

There is no such thing as bad government only a bad public, this applies not only in democracies but in dictatorships who still need your neighbours to run thing

 


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Too many causes

I did not see the video at http://www.crisisofcredit.com before this post, but I found the video explaining everything to be well done for the amount of time it took to explain it.  It left out home equity extractions, where existing home owners could take out additional loans for the increased value of their homes.

Unfortunately, this is just the very height of the stupidity in our financial system, and there are many other causes out there.  I used to think that Zeitgeist Addendum was good at visually describing the Federal Reserve and our money supply, but I found that Crash Course at http://www.chrismartenson.com/crashcourse offered a much more thorough description.  I also appreciate the more objective presentation within Crash Course.  I highly recommend it.

EXC's post about 401(k)s reminds me of another problem.  The reason why Social Security is in trouble is that it has no savings and simply funnels money from current workers to retirees.  This actually would work, except due to the baby boomer generation, the workforce will decrease while the number of retirees increase.  Not only will this make Social Security bankrupt, but as retirees draw down their 401k savings, sell second homes, and sell other investments, the situation of having more sellers than buyers will cause prices of many assets to decrease.  Considering our current problems, this is a really bad time to add further problems.

Someone once asked me what I would do to fix all of this if I had the power.  I could not think of anything.  Practically every component of our financial system is unsustainable, already in a weak spot, corrupt, and/or has other or will have other problems.  So I think that a total and synchronized crash might do the least damage (perhaps politically) as recovery would be quicker than a drawn out Great Depression 2.0.  Frederic Bastiat said, "When goods do not cross borders, soldiers will."  Other people have thought about a Jubilee, which would cancel all debt and require a fresh start.  The problem that I see there is, a start to what?

The main problem that I see ultimately comes down to this: Humans are not smart enough to manage people, money, or any other thing on a large scale.  We need to institute systems that are sustainable and prevent governments from interfering with them.  It may be a good political platform to make various things more affordable, but elected representatives, voters, Wall Street, and many other groups of people are not smart enough to know all of the unintended consequences.  This reminds me of the saying: "The road to hell is paved with good intentions."  A real free market (not what we have had since the government or a central institution sets interest rates and policies) works because natural systems are better at regulating than central systems.  "Distributed power is more sustainable than central power" works for the economy just as it works for government.  Although we still need fair rules, which does require some thinking on the part of government.

The book "A Short History of Progress" by Ronald Wright has helped me see me that as a species operating in civilizations, we are prone to making the same mistakes over and over.  I wonder if the Internet will help break some of these stupid cycles, but I have come to one conclusion: The end of the nonthinking/non-reasoning/unsustainable/unreasonable aspects of religion will probably not be good enough (although it will be a worthwhile progress).  Despite it being a large liability to our survival, we as a civilization still make too many mistakes regardless of religion.  We need to instill the scientific mindset in everyone.  In the movie Sicko, a Canadian citizen reasoned that providing higher education to everyone benefited him because he would rather live in a well educated society.  In my ideal society, there would not need to be any laws about homeopathy because it will be regarded as an odd relic of the past, taking its place somewhere near alchemy.  This kind of thinking should be present in everyone who passes 3rd grade.

I apologize for the long post, but if you are looking for causes, it goes way back and involves too many things.  I view this crisis as a result of our species unable to manage complex systems.  Given the past performance of our species operating in civilizations, even attempting to operate complex systems will nearly guarantee failure at some point.  I think that the best long term solution is to simplify into simpler, distributed systems that operate with sustainable rules.  Better education is, of course, also necessary.

That brings me to another rant, elementary history should not be about memorization of what happened when and where.  While that has academic value, history is far more valuable as lessons learned and mistakes to avoid.

"Ridicule is the only weapon which can be used against unintelligible propositions. Ideas must be distinct before reason can act upon them; and no man ever had a distinct idea of the trinity. ..." -- Thomas Jefferson


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Mr. XC wrote: Someone once

Mr. XC wrote:


Someone once asked me what I would do to fix all of this if I had the power.  I could not think of anything.  Practically every component of our financial system is unsustainable, already in a weak spot, corrupt, and/or has other or will have other problems.  So I think that a total and synchronized crash might do the least damage (perhaps politically) as recovery would be quicker than a drawn out Great Depression 2.0.  Frederic Bastiat said, "When goods do not cross borders, soldiers will."  Other people have thought about a Jubilee, which would cancel all debt and require a fresh start.  The problem that I see there is, a start to what?

I agree just let everything crash and start from scratch. The government actually needs a plan to reboot the entire economy in case of natural or man made disaster.

There is an irrationality on the part of Obama and others that ¨doing nothing is not an option¨. By doing something they are just sustaining the institutions(AIG, Citigroup) and policies that created the problems in the first place. The governments only role should be to prevent fraud and make sure insurance contracts are collateralized.

Here is an interesting story, here is the office and person most responsible.

 

http://abcnews.go.com/Business/story?id=7045889&page=1

 

 

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The government/society role

The government/society role is whatever it wants it to be


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I could fix it. It would

I could fix it. It would just take a bare minimum of 20-40 years and complete or near-complete political, economic, and military power in my hands. As long as noone assassinated me, and there were no unforeseen problems or foreseen problems with unforeseen consequences that is. And, of course, about 80% of the population would hate me for awhile. The number would drop slowly over time, but would never reach zero(at least, not in my lifetime). I'd be eliminating the upper class after all. But I'd also eliminate the lower class, so I'd have more people with me than against me by the final tally.

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I could fix it. It would

Allright, now I'm annoyed. At least I noticed what was happening this time. Apparently as I went to add a sentence to the end of that post, every time I hit the space bar the site took it as me clicking on post response. I don't have the slightest idea how a site could mistake the entering of text into a text window as the clicking of a post button though, so I refuse to accept responsibility for spamming. Smiling

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Vastet wrote:I could fix it.

Vastet wrote:

I could fix it. It would just take a bare minimum of 20-40 years and complete or near-complete political, economic, and military power in my hands. As long as noone assassinated me, and there were no unforeseen problems or foreseen problems with unforeseen consequences that is. And, of course, about 80% of the population would hate me for awhile. The number would drop slowly over time, but would never reach zero(at least, not in my lifetime). I'd be eliminating the upper class after all. But I'd also eliminate the lower class, so I'd have more people with me than against me by the final tally.

It is very rare that I call a fellow atheist delulsional, even when they are talking about a fictional utopia.

The rich class exist in every government, those are the ones in power. Sadamn was not poor, Kim Jong Ill doesn't sleep in a tent, and I am sure Putan doesn't eat cat food as a substitute for tuna.

You need a 3 class system for a free market to work. You cannot have everyone making the same, otherwise there would be no incentive.

HAVING SAID THAT, I am not for the Bush policy of slash and burn anarchy where it is every man for themselves. I am for a closer ratio of wadges that is not as lopsided where the rich ceo's make 400 times more than their janitor.

BUT, that does not mean we should pay everyone the same. If we paid everyone 1,000,000 dollars, who would be a fry cook? If we paid everyone including the CEOs $7.25 an hour, who would do the work?

My problem is class warfare where the government lacks as much introspection as the rich they protect and pit the classes against each other.

I am not for a government run economy anymore than I am for the Bush "let them eat cake" policy.

I don't think that you understand that Capitalism exists in every government around the world. All the word means is to take advantage and make money off of a given situation. The Saudi Royal family capitalizes of the labor of their poor with the profits of oil.

So the problem is not capitalism, the problem is the regulation of the free market. Competition is natural in the human species, and that concept cannot be thrown out.

Ethics in the free market is what we lack, but do not fool yourself into thinking that humans don't take advantage of a situation ever, in America we call that Oportunity. I think what you rightfully object to is abuse of power.

 

 

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Quote:And, of course, about

Quote:

And, of course, about 80% of the population would hate me for awhile

If 80% of people hated you, then how would you intend to gain political power?

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My only fear of total

My only fear of total collapse is that, rather then restarting a healthy market, it will produce direct government control over the economy. A complete collapse of the market would be the greatest thing to ever happen to proponents of direct government command of the economy. The fact that the government's manipulations of the economy was one of the largest causes of the collapse doesn't occur to these people. I can imagine it now: "The End of the Free Market!"

Just as a security disaster can be used to give the government more control over us under the excuse of keeping us safe, so can an economic disaster be used to give the government more economic control over us under the excuse of preventing future crashes. People would work hard to twist this around and make it seem as though only destroying all capitalism will keep us safe from future crashes.

Vastet, you should start a new thread explaining your idea. Off the cuff, it sounds like you would produce a hellish dystopia (so bad that at least 80% of people would hate you for it and you fear that assassination would stop you from completing your plan), but we could hear you out and see if you are making sense in your plan.

"You say that it is your custom to burn widows. Very well. We also have a custom: when men burn a woman alive, we tie a rope around their necks and we hang them. Build your funeral pyre; beside it, my carpenters will build a gallows. You may follow your custom. And then we will follow ours."
British General Charles Napier while in India


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Brian37 wrote:It is very

Brian37 wrote:

It is very rare that I call a fellow atheist delulsional, even when they are talking about a fictional utopia.

Lol. I didn't say I could fix EVERYTHING that's wrong. That would take more than I have to offer. Much much more. I'm just talking about a simple fiscal issue.

Brian37 wrote:

The rich class exist in every government, those are the ones in power. Sadamn was not poor, Kim Jong Ill doesn't sleep in a tent, and I am sure Putan doesn't eat cat food as a substitute for tuna.

True.

Brian37 wrote:

You need a 3 class system for a free market to work. You cannot have everyone making the same, otherwise there would be no incentive.

I have no interest in a free market. Incentive can be provided with other ways.

Brian37 wrote:

HAVING SAID THAT, I am not for the Bush policy of slash and burn anarchy where it is every man for themselves. I am for a closer ratio of wadges that is not as lopsided where the rich ceo's make 400 times more than their janitor.

Same here.

Brian37 wrote:

BUT, that does not mean we should pay everyone the same.

Of course not. Some jobs are more valuable to society than others. But the difference between the low and high ends can be mitigated significantly.

Brian37 wrote:
 If we paid everyone 1,000,000 dollars, who would be a fry cook? If we paid everyone including the CEOs $7.25 an hour, who would do the work?

There is a happier medium than the vicious circle that inhabits our current economies. Minimum wage goes up, prices follow. Which means absolutely nothing happened except the devaluation of the dollar.

Brian37 wrote:

My problem is class warfare where the government lacks as much introspection as the rich they protect and pit the classes against each other.

Agreed, which is why removing the classes would be part of my plans.

Brian37 wrote:

I am not for a government run economy anymore than I am for the Bush "let them eat cake" policy.

I am very much in favour of a government run economy. Just not the government we know and hate today. 

Brian37 wrote:

I don't think that you understand that Capitalism exists in every government around the world. All the word means is to take advantage and make money off of a given situation. The Saudi Royal family capitalizes of the labor of their poor with the profits of oil.

I am indeed aware of this. It does complicate matters, but there are ways through the mire if one is looking hard enough.

Brian37 wrote:

So the problem is not capitalism, the problem is the regulation of the free market. Competition is natural in the human species, and that concept cannot be thrown out.

Throwing out competition is indeed a bad idea. Throwing out the free market is not.

Brian37 wrote:

Ethics in the free market is what we lack, but do not fool yourself into thinking that humans don't take advantage of a situation ever, in America we call that Oportunity. I think what you rightfully object to is abuse of power.

Ethics cannot be put into the free market and expect to survive the rigours of time. Time has proven this, with unions now being useless. Despite the desperate need for them when they first arrived on the scene.

deludedgod wrote:

Quote:

And, of course, about 80% of the population would hate me for awhile

If 80% of people hated you, then how would you intend to gain political power?

This is why I'm not in power. It is also why I've not tried to gain it. Too many opponents. Maybe someone can pull it off in a couple hundred years when views on various matters have changed, if they do, but not so much today. Not without a shitload of violence. Which would complicate matters beyond repair.

Jormungander wrote:

Vastet, you should start a new thread explaining your idea. Off the cuff, it sounds like you would produce a hellish dystopia (so bad that at least 80% of people would hate you for it and you fear that assassination would stop you from completing your plan), but we could hear you out and see if you are making sense in your plan.

No, it's more that rich people would hate me for taking "their" money(not that it's really theirs, but they don't generally realize it these days..). Cops would hate me for putting them out of work(military would be taking over that job). Doctors and nurses would hate me for requalifying their qualifications. Teachers are the same. It's just the same as when the metric system was introduced in Canada. Everyone hated it, and the government that forced it on them. The next generation, not so much. The generation after that doesn't even know the imperial system well enough to run conversions, and is quite happy with the superior system. This is the kind of hate I speak of, not people pissed off in death camps or the like.

As for a new topic, I've considered that over the last couple years, but the idea of typing out all that I've thought of doesn't seem practical(There's way too much for me to remember in a single sitting, let alone having the time to type it all out and come up with a good format for presentation). I'll do far better responding to concerns than laying it all out. I can accomplish the same thing with less work. Sticking out tongue

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Jormungander wrote:My only

Jormungander wrote:

My only fear of total collapse is that, rather then restarting a healthy market, it will produce direct government control over the economy. A complete collapse of the market would be the greatest thing to ever happen to proponents of direct government command of the economy. The fact that the government's manipulations of the economy was one of the largest causes of the collapse doesn't occur to these people. I can imagine it now: "The End of the Free Market!"

Just as a security disaster can be used to give the government more control over us under the excuse of keeping us safe, so can an economic disaster be used to give the government more economic control over us under the excuse of preventing future crashes. People would work hard to twist this around and make it seem as though only destroying all capitalism will keep us safe from future crashes.

I think we are in a negative feedback loop. Things get worse, so the government must do more of what caused the problems in the first place. The only end game is bankruptcy of the government and perhaps collapse of the government as well.

 

“Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful.” Seneca



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Quote:No, it's more that

Quote:

No, it's more that rich people would hate me for taking "their" money(not that it's really theirs, but they don't generally realize it these days..). Cops would hate me for putting them out of work(military would be taking over that job). Doctors and nurses would hate me for requalifying their qualifications. Teachers are the same. It's just the same as when the metric system was introduced in Canada. Everyone hated it, and the government that forced it on them. The next generation, not so much. The generation after that doesn't even know the imperial system well enough to run conversions, and is quite happy with the superior system. This is the kind of hate I speak of, not people pissed off in death camps or the like.

As for a new topic, I've considered that over the last couple years, but the idea of typing out all that I've thought of doesn't seem practical(There's way too much for me to remember in a single sitting, let alone having the time to type it all out and come up with a good format for presentation). I'll do far better responding to concerns than laying it all out. I can accomplish the same thing with less work. Sticking out tongue

Wow, Vastest. You're such a super-genius. No wonder the economic crisis wasn't averted - duh, you weren't in charge!

 

Yes, demanding that wealthy business owners and investors hand over their earnings without any form of compensation. Gee whiz, why hasn't the treasury department figured this one out? It would... erm... that is... hm.

What would it do again? I mean, aside from giving business owners & investors a large incentive to leave the country?

 

Disbanding the RCMP and instating martial law! Now there's a real marverick solution to the problem. Think of all the improvements we would make by destroying so many jobs, like... uh... hm.

Well, I guess it would give the Canadian military something to actually do, right?

 

Creating new standards for teachers and nurses and creating a government program to re-examine every single nurse and teacher's qualifications. Brilliant! That would only cost us... err... oh.

Well, okay. Maybe spending that kind of money on such a marginally effective at best excercize isn't such a great idea when money is a tad tight.

 

 

How the Hell are your various insanities at all 'just the same' as when the metric system was introduced, out of curiousity? I don't seem to remember the part in my high school Canadian history book where the implementation of a new measurement system was via a hostile take-over of the country by the government and resulted in a police state being imposed for 20-40 years.

Quote:
"Natasha has just come up to the window from the courtyard and opened it wider so that the air may enter more freely into my room. I can see the bright green strip of grass beneath the wall, and the clear blue sky above the wall, and sunlight everywhere. Life is beautiful. Let the future generations cleanse it of all evil, oppression and violence, and enjoy it to the full."

- Leon Trotsky, Last Will & Testament
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And here I was hoping for a

And here I was hoping for a challenge. Like Yellow maybe. Ah well.

Kevin R Brown wrote:

Wow, Vastest. You're such a super-genius.

Hardly. And it's Vastet. No extra s. Eye-wink

Kevin R Brown wrote:
 No wonder the economic crisis wasn't averted - duh, you weren't in charge!

I'm hardly the only one who's capable of fixing this mess. I'm sure there's millions of people out there.

 

Kevin R Brown wrote:

Yes, demanding that wealthy business owners and investors hand over their earnings without any form of compensation. Gee whiz, why hasn't the treasury department figured this one out? It would... erm... that is... hm.

They'd hardly get no compensation. I'm not in favour of beggaring the rich. There'd simply be changes in the way the economy and politics worked, and an evening out of payrolls.

Kevin R Brown wrote:

What would it do again? I mean, aside from giving business owners & investors a large incentive to leave the country?

1: The money of the State belongs to the State above all. Every dollar printed belongs to the government. They'd have no choice. The freezing of assets is one of the first things to be done if one was to move forward today. After the dust had settled, they'd be free to leave and get their citizenship bought out if they wanted, but they'd do better off staying.

2: They're not really losing that much in the long run. 2 million dollar houses and private jets maybe, but there's no justification for such things in the face of the homeless problems we have in Canada alone.

A booming economy is one where everyone is working and spending and paying taxes(though this would change too). Everyone spends if everyone has enough to. There's more than enough to, even in the current scenario. The better the country does economically, the better the people will do as well.  

Kevin R Brown wrote:

Disbanding the RCMP and instating martial law! Now there's a real marverick solution to the problem. Think of all the improvements we would make by destroying so many jobs, like... uh... hm.

The RCMP wouldn't be disbanded entirely, they'd be merged into the military, which would undergo a significant metamorphosis, increasing it's diversity and capability as well as its agility and speed.

Many of them would probably lose their jobs, because they suck at doing them. But they wouldn't be out of work. They just wouldn't be cops anymore. There's more than enough jobs to do.  

As for martial law, I never said marial law would be instituted. If it were, there'd be a good reason for it, and it would be done somewhat differently than it has previously in history.

Kevin R Brown wrote:

Well, I guess it would give the Canadian military something to actually do, right?

They're doing plenty right now, and it pisses me off. But that's another subject. Actually, they'd have shitloads to do. They'd be one of the first sources I tapped for educational resources. Our military is one of the best trained in the world.

 

Kevin R Brown wrote:

Creating new standards for teachers and nurses and creating a government program to re-examine every single nurse and teacher's qualifications. Brilliant! That would only cost us... err... oh.

Take a good look at our education and health care system and tell me it doesn't need to happen. And we're lucky compared to the US.

Kevin R Brown wrote:

Well, okay. Maybe spending that kind of money on such a marginally effective at best excercize isn't such a great idea when money is a tad tight.

Nothing wrong with spending money, especially when doing so creates jobs. Even more so when the quality of the system is improved. Money isn't all that tight. Besides, the US has run up a multi-trillion dollar debt in the last decade and accomplished nothing in the process. It wouldn't take nearly as much money to reset the school and health system. Especially with the foundation of the economy changing.

 

Kevin R Brown wrote:

How the Hell are your various insanities at all 'just the same' as when the metric system was introduced, out of curiousity?

While the metric system was a small change compared to this, it is still a valid comparison. It had a major negative impact on everyone in the country for a brief time(a generation). I would also reference the changeover to democracy as another example. It was a more popular change of course, though it's possible that I've vastly overestimated my potential adversary count. But I don't underestimate potential adversaries.

Kevin R Brown wrote:

 I don't seem to remember the part in my high school Canadian history book where the implementation of a new measurement system was via a hostile take-over of the country by the government and resulted in a police state being imposed for 20-40 years.

It's possible that it could be accomplished democratically, it would just take a whole lot longer. Which is how I expect it will eventually happen.

And there you go with your police state again. I never implied the populace would be locked up in some way. That would be counter to the very foundation of the idea of putting the country in shape. I'd be giving the people more power, not taking it away. It would simply take a generation or so for all the shit to settle.

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Vastet wrote:1: The money of

Vastet wrote:

1: The money of the State belongs to the State above all. Every dollar printed belongs to the government. They'd have no choice. The freezing of assets is one of the first things to be done if one was to move forward today. After the dust had settled, they'd be free to leave and get their citizenship bought out if they wanted, but they'd do better off staying.

Nope. Once the state gives that money out it belongs to its private holder above all. You seem to be claiming that there is no such thing as property rights when it comes to money. Also, people would be better off leaving Canada in this senario. They could move to a country that doesn't lay claim to all of their property and has lenient tax laws such as Ireland or the US. That sounds like a good move to me.

 

Vastet wrote:

 

2: They're not really losing that much in the long run. 2 million dollar houses and private jets maybe, but there's no justification for such things in the face of the homeless problems we have in Canada alone.

It sounds to me like that are losing a lot in the long run. They will lose their homes and their means of transportation. That sounds to me like they are losing their most valuable possessions. I suppose they are to be happy living in whatever home you tell them to and travelling by whichever means you tell them to? But homeless people exist, so that makes it right to have the government steal people's jets and homes. I didn't know moral justifications work that way. I should try that out someday. "Get out of your car. I'm taking it from you. I'm allowed to take it because homeless people exist, so you aren't really losing that much. I'll be back to take your house from you later."

 

Vastet wrote:

Nothing wrong with spending money, especially when doing so creates jobs. Even more so when the quality of the system is improved. Money isn't all that tight.

I thought that there was a special American brand of stupidity that produced thoughts like this. "Money is really tight at the moment, so lets ramp up spending! The problem of our government's financial problems can be solved through increased spending." Are you quoting Obama in those sentances? I really thought that Canadians were a bit brighter than that.

 

Vastet wrote:

Besides, the US has run up a multi-trillion dollar debt in the last decade and accomplished nothing in the process.

My government's stupidity doesn't justify stupidity from your government.

 

Vastet wrote:

I never implied the populace would be locked up in some way.

Vastet wrote:

The freezing of assets is one of the first things to be done if one was to move forward today. After the dust had settled, they'd be free to leave

Freezing assets and only allowing them to leave "after the dust had settled" is locking them up.

"You say that it is your custom to burn widows. Very well. We also have a custom: when men burn a woman alive, we tie a rope around their necks and we hang them. Build your funeral pyre; beside it, my carpenters will build a gallows. You may follow your custom. And then we will follow ours."
British General Charles Napier while in India


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Jormungander wrote:Vastet

Jormungander wrote:

Vastet wrote:

1: The money of the State belongs to the State above all. Every dollar printed belongs to the government. They'd have no choice. The freezing of assets is one of the first things to be done if one was to move forward today. After the dust had settled, they'd be free to leave and get their citizenship bought out if they wanted, but they'd do better off staying.

Nope. Once the state gives that money out it belongs to its private holder above all. You seem to be claiming that there is no such thing as property rights when it comes to money.

If you take a real close look at the infrastructure of the law, you see that the government has full and sole authority to seize assets and property (including land) at will. It just needs a good reason.

Jormungander wrote:

 Also, people would be better off leaving Canada in this senario. They could move to a country that doesn't lay claim to all of their property and has lenient tax laws such as Ireland or the US. That sounds like a good move to me.

Except that in the infrastructure being created, the people are the government, a closer form of government to true democracy than we currently have. It would simply be recognized that you were only a part owner. And there would be no property taxes.

 

Jormungander wrote:

Vastet wrote:

 

2: They're not really losing that much in the long run. 2 million dollar houses and private jets maybe, but there's no justification for such things in the face of the homeless problems we have in Canada alone.

It sounds to me like that are losing a lot in the long run. They will lose their homes and their means of transportation.

They will be provided with alternatives.

Jormungander wrote:
 That sounds to me like they are losing their most valuable possessions.

People losing a few useless trinkets is a small price to pay for 10 times more people living in a real home with food on the table.

Jormungander wrote:
 I suppose they are to be happy living in whatever home you tell them to and travelling by whichever means you tell them to?

Rebuilding the infrastructure of the nation to accomodate the change in political and economic policy would be the most costly part of this, I don't deny it. Our entire civilization is built upon capitalism, and entire cities are based on it. These cities would have to be rebuilt from the ground up to facilitate the standard of living I envision. But once it was done, the rich wouldn't see a huge difference in their quality of living. The poor would see a massive change.

Jormungander wrote:
 But homeless people exist, so that makes it right to have the government steal people's jets and homes.

The rich do it all the time. They do far worse. A vast majority of the rich are only rich because they live off the work of the poor. I have no problems with reversing the trend.

Jormungander wrote:
 I didn't know moral justifications work that way. I should try that out someday. "Get out of your car. I'm taking it from you. I'm allowed to take it because homeless people exist, so you aren't really losing that much. I'll be back to take your house from you later."

Oh, and by the way. Here's a new car that doesn't need gas. And here's a new house that has proper plumming, electricity, heating, and plenty of room for your family. It also happens to be close to your work and school.

Jormungander wrote:
 

Vastet wrote:

Nothing wrong with spending money, especially when doing so creates jobs. Even more so when the quality of the system is improved. Money isn't all that tight.

I thought that there was a special American brand of stupidity that produced thoughts like this. "Money is really tight at the moment, so lets ramp up spending! The problem of our government's financial problems can be solved through increased spending." Are you quoting Obama in those sentances? I really thought that Canadians were a bit brighter than that.

The problem is in the setup of the economy in the first place. Every dog for itself, with a good 30% of all the money spent in the economy as pure waste. Wasted on excess advertising, wasted on excess competition, wasted on purchases, wasted on shipping, wasted on patents, etc. Wasted.

Jormungander wrote:

Vastet wrote:

Besides, the US has run up a multi-trillion dollar debt in the last decade and accomplished nothing in the process.

My government's stupidity doesn't justify stupidity from your government.

You have yet to prove that becoming socialist would be stupid.

 

Jormungander wrote:

Vastet wrote:

I never implied the populace would be locked up in some way.

Vastet wrote:

The freezing of assets is one of the first things to be done if one was to move forward today. After the dust had settled, they'd be free to leave

Freezing assets and only allowing them to leave "after the dust had settled" is locking them up.

They can leave whenever they want, they'd just be doing it without massive assets. In the interim, there'd be a limit to how much money someone could leave the nation with. So they aren't locked up. Actually, depending on how it was done, they might be free to leave with everything. It rather depends on how much difficulty would lie in ripping out the heart of the economic policies of today. Of course, if that did work, the current Canadian dollar would be devalued past Zimbabwe in favour of a new currency, so the net result is about the same for actual cash.

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economic crisis cause

Greed.


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From over here in Tampa ...

Which has nothing really to do with it. But regarding the housing prices.

I did not believe it when I heard it and it was on a "consumer help" segment. Seems a man was having problems with his credit card and the local asshole made a segment of helping him. It was resolved. The details of the matter are what left me in the "speechless" category.

The interesting thing was that his credit card limit was secured by his home equity. And the equity was determined by the difference between current market price and the price at time of mortgage.

The man was spending paper value increases and paying some 18% interest on that spending. So if (when) there was a dip in home prices his equity would go down and his line of credit would go down. Compounding this the decrease in spread would cause his interest rate to go up. And then the combined factors would reflect on his ability to pay.

This entire system only works when housing prices are increasing. This system has to fail if prices stagnate for even a short period of time. This system is guaranteed to collapse when prices decrease.

Of course the credit card method of drawing down equity is not what ruled but the entire system was close to it. Value on paper becomes real dollars. All the paper changes hands as intangibles but real dollars are being spent, taken out of the paper system. When the paper value collapses the dollars are long gone and there is nothing left. A ponzi scheme without a Madoff to blame.

BTW: I made a bundle in the late 70s housing bubble in DC. I made the money by knowing it was a bubble, buying while it was rising and selling out before it burst. Been there and done that. 

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Dracos wrote:
Greed.

Greed is good when you win.

As some of the banks pointed out they were lending to low income people as the congressrats had been demanding.

There is an old saying. You cannot cheat an honest man.

The only person you can cheat is one who thinks he is cheating you.

Jews stole the land. The owners want it back. That is all anyone needs to know about Israel. That is all there is to know about Israel.

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Old sayings

Do you really believe that an honest man cannot be cheated?  Do you think that the only person you can is one cheating you?  Bullshit.  You need more life experience.


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Ahhh, come on now.

I seriously must agree with Dracos. Honest people are cheated on a regular, consistant basis. Let's be real here.

"Old sayings" equates too much to religion for me, which makes sense when you consider that "old sayings" originate from times and people who thought dogmatic religions- and their stiltifying 'thought' processes- were at all valid. We know they are not, so I like to not give validity to relics of a discredited past in the form of "old sayings".

We need new sayings.


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 Maybe this will

 Maybe this will help:

 

mid-late 1970s - oil crisis, market crash

1987 - junk bonds market crash

1997 - Asian crisis, market crash

2008 - Mortgage crisis, market crash

 

Need I go back any farther to illustrate this point? It's not just "greed" or "socialism" or any of the rest of it. People have been following this pattern for at least 200 recorded years of having markets, and most likely many more before that. Markets have crashed over tulips, for crying out loud!

We will do this for eternity.

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BebekCucuk wrote:I seriously

BebekCucuk wrote:

I seriously must agree with Dracos. Honest people are cheated on a regular, consistant basis. Let's be real here.

You mean A_Nony_Mouse, not Dracos. Sticking out tongue

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Hold on...

Dracos wrote:

Do you really believe that an honest man cannot be cheated?  Do you think that the only person you can is one cheating you?  Bullshit.  You need more life experience.

What I actually meant to agree with was what Dracos said above. I think its nonsense to believe that honest people cannot be cheated. Sorry for not being clear on this.


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No, it's my fault. My brain

No, it's my fault. My brain filling in blanks as I speed read that aren't actually there. Apologies.

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No probs.


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Dracos wrote:

Do you really believe that an honest man cannot be cheated?  Do you think that the only person you can is one cheating you?  Bullshit.  You need more life experience.

Depends on how you define honest. There are people that are honest in that the don't try to rip off other people, but they still get cheated because they try to cheat the rules of how things work.

Take the Madoff investors, they believed Madoff could beat the market. They didn't do their research, they took a lazy route. They put their faith in government, yet people deserve the government they get. They had faith without facts, that's cheating. They wanted a free lunch.

“Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful.” Seneca


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I'm thinking there's

I'm thinking there's probably a 1000+ more Madoff's out there


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EXC wrote:Here's what I

EXC wrote:

Here's what I think are the main causes of the Crisis. Curious to know what others think.

1. Government policy of making mortgages available to people who could not afford them. To solve the fact that some people could not afford to live in expensive homes, the government created Freddy and Fanny and manipulated interest rates to make them affordable. In the end all this did was drive up the price of homes making them even more expensive and causing an overbuilding of homes during the housing bubbles.

Bullshit. Government did not give the loans, the private industry did. At the same time the private industry infiltrated government to such an extent since the Regan years, that now CEOs of major banks just go back and forth from government jobs to private industry. They are basically regulating themselves and operating with public money. The same crew that got rid of Glass-Steagall Act in 1999, Greenspan, Paulson, Summers, Geitner under supervision of the Clinton administration, are basically behind the stealing of the lifeboats (read: bailout) from the ship they themselves were trying to sink for decades.

Your assertion that this somehow is limited to real estate is just ludicrous. This is lack of infrastructure, industry in general, linked to "specialisation of agroculture" in US and it's client countries. This is rearangement of ownership on global scale, consolidation of power in few hands beyond your wildest dreams.

EXC wrote:

2. Government allowing uncollateralized insurance contracts. High risk mortgages were sold as low risk investments because they had default insurance through companies through AIG and others. Capitalism or any system can not work unless parties to a contract can prove they can fulfill the terms of the contract. AIG and investment banks did not have collateral to cover their insurance policies, so they should not have been allowed to issue insurance.

I don't think you can talk about government any more, really. It's just a PR department for Lockheed Martin right now. You will have to kick bankers, weapons and drug dealers and economic hit-men out of office, before you can talk about a government.

Remember, these guys have their own private military operating on US soil now, I believe they changed name to Xe recently. You might even have to organize against that pretty soon. US is as close to fascism as it ever has been.

EXC wrote:

3. 401k tax breaks. The government encouraged investment in the stock market through deferred tax breaks. All this did was artificially drive up the price of stocks. Too much money chasing after too few good investments. Too many investors disconnected from the operation of the company with no management oversight.

Private industry encouraged the government not to fuck with their economic interest and replaced legislation with yes-men. Cutting taxes for the richest should tell you about that.

EXC wrote:

4. Home Mortgage Interest deduction. People overbought housing and borrowed tons of money as means of reducing the burden from the unfair income tax system.

Number one reason for family and personal bankrupcy in the US are medical bills, since the insurrance industry will not allow Americans to have a cheaper and better guarantied coverage by the state. Same goes for the tax system.

The people who are drowning in debt are not there primarily because of this or that tax, but mainly because the rich own them and their legislation. This is evident in every aspect of the society and is the first thing that needs to be changed.

EXC wrote:

5. Deferred Employee Compensation. Companies like GM and the California government making long term commitments to employees to cover their pensions and health care for life. Cash should be paid to employees who make their own retirement/health care decisions. The Union system has failed both the workers and companies.

Bullshit. The unions have been under attack for as long as they have existed. Union members have been bullied by their employers, unions have been banned in corporations, direct illegal activity against unions has been allowed by as far back as start of 1900. ANY form of worker organization has been under assault by the employers since the start of existance of capitalism.

Yes, the money should go to the workers and YES, unions should be in the position of STRENGTH, so that they can demand these rights for the workers. If the workers can't get what's theirs ON THEIR OWN, it's time to organize.

EXC wrote:

6. Encouragement of lending. The lending industry is simply a way for the rich to get richer without work and the working poor to remain their slave. It should not be 'vital' to our economy, it needs to be discouraged and regulated as much as possible. No more bailouts.

Agree there, except that there needs to be a serious round of punishment dealt to people in the government and private industry who knew what they were doing and did it anyway. Also there needs to be a serious round of refunding of public school system, public hospitals, establishment of public health-care meaning a guarantee of treatment of any illness for any person residing in the US, livin wages for the workers and security for the unemployed, a comprehensive reworking of the public transport and traffic in general, infrastructure. Preferably in that order.

If any lending is to be done, the first thing we should look at is the usery law - that should be the Bible of lending.

To get there from where we are now, nothing short of a full blown resistance movement will be sufficient.

EXC wrote:

7. Failure fix economic disparity. The fact is there is a wide gap in demand/supply in services among our workers. This problem must be solved and not a redistribution of wealth through socialism and income high taxes.

Yea, I thought the points I read so far were written by a retreating conservative/libertarian-wannabe. Where did your "personal responsibility" dissapear to all of a sudden? Government should do this and that, what about the private industry? They had no responsibility here? But I guess you and I both understand that personal responsibility in corporations only goes so far as they are not allowed to fuck America up the ass, don't we? You and I are't so far apart after all.

Maybe you should try and be a true conservative and be outraged over our private sector, instead of being a socialist like me and already acknowledging that they are some selfish motherfuckers and that we need constraints just to keep them from eating ordinary people alive. We need true conservatives to uphold values and stuff, not confused socialists like yourself. You be conservative/libertarian, I'll be the socialist, together we'll keep private sector and the government from turning us into a fascist state, how about that?

EXC wrote:

8. The Fed. The Federal Reserve was continually changing interest rates and money supply. Along with being an illegal tax and being unaccountable to the taxpayers/citizens, it created volatile conditions and bubbles. Strong economies need stability and some predictability, they need to stop continually manipulating the market and give us stability.

Government needs to give us stability? Shit, you really are a socialist. How come you don't like the word socialism then? You like all the stuff socialist like, you think the same about the private industry, how come you don't think socialism is a good idea? Or at least some mild form of strongly regulated private industry and stable social environment? You don't like people or something?

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Quote:Do you really believe

Quote:

Do you really believe that an honest man cannot be cheated?  Do you think that the only person you can is one cheating you?  Bullshit.  You need more life experience.

 

There is an hidden assumption that most people are honest in that statement, most people ie the public will lie and cheat as much as they can possibly get away with it.  An in the case of this slump far more than they could get away with (Government/corparations are no more or less than the the general public)

 


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ZuS wrote:establishment of

ZuS wrote:

establishment of public health-care meaning a guarantee of treatment of any illness for any person residing in the US, livin wages for the workers and security for the unemployed

That was quite a bit of verbal diarrhea. I would like to argue against this quote in particular, but then I would be derailing the thread. Perhaps, if you made a new thread in which you outlined your socialist fantasies, we could all discuss them there. I'd love to discuss the 'living wage' and why it will harm poor people, but I don't want to turn this thread into Jormungund's attack on socialism.

"You say that it is your custom to burn widows. Very well. We also have a custom: when men burn a woman alive, we tie a rope around their necks and we hang them. Build your funeral pyre; beside it, my carpenters will build a gallows. You may follow your custom. And then we will follow ours."
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ZuS wrote:Bullshit.

ZuS wrote:

Bullshit. Government did not give the loans, the private industry did. At the same time the private industry infiltrated government to such an extent since the Regan years, that now CEOs of major banks just go back and forth from government jobs to private industry. They are basically regulating themselves and operating with public money. The same crew that got rid of Glass-Steagall Act in 1999, Greenspan, Paulson, Summers, Geitner under supervision of the Clinton administration, are basically behind the stealing of the lifeboats (read: bailout) from the ship they themselves were trying to sink for decades.

Your assertion that this somehow is limited to real estate is just ludicrous. This is lack of infrastructure, industry in general, linked to "specialisation of agroculture" in US and it's client countries. This is rearangement of ownership on global scale, consolidation of power in few hands beyond your wildest dreams.

The government did lots of things to make it easy and profitable to make loans for homes/college and personal use. Some may have been well intentioned, but all they did was create the bubble with their ignorance of basic economics. Some of it was corruption.

I agree they was plenty of bad lending internationally and in other areas as well. All of this was encourage by governments. The world band and IMF need to be dumped as well.

ZuS wrote:

I don't think you can talk about government any more, really. It's just a PR department for Lockheed Martin right now. You will have to kick bankers, weapons and drug dealers and economic hit-men out of office, before you can talk about a government.

Remember, these guys have their own private military operating on US soil now, I believe they changed name to Xe recently. You might even have to organize against that pretty soon. US is as close to fascism as it ever has been.

We need a form a government that forces accountability. A way for politicians to be kicked out without a pension when they screw up and direct path to jail when they commit criminal acts.

EXC wrote:

ZuS wrote:

Private industry encouraged the government not to fuck with their economic interest and replaced legislation with yes-men. Cutting taxes for the richest should tell you about that.

The rich still pay the vast majority of taxes. Many earned their money through hard work and not corruption. Why punish their success?

ZuS wrote:

Number one reason for family and personal bankrupcy in the US are medical bills, since the insurrance industry will not allow Americans to have a cheaper and better guarantied coverage by the state. Same goes for the tax system.

The fact that individuals don't buy their own insurance is a reason for high medical costs. If you make public funds available to pay for medical expenses, the medical industry will just raise the price of medical care and introduce more expensive 'cures'. So more public funds will be required until the state goes bankrupt.

ZuS wrote:

Bullshit. The unions have been under attack for as long as they have existed. Union members have been bullied by their employers, unions have been banned in corporations, direct illegal activity against unions has been allowed by as far back as start of 1900. ANY form of worker organization has been under assault by the employers since the start of existance of capitalism.

The bulling has worked both way. Individuals are often not allowed to negotiate their own compensation from an employer. The unions try to prevent the laws of supply and demand from working properly. In the long run all this does is hurt everyone.

ZuS wrote:

Yes, the money should go to the workers and YES, unions should be in the position of STRENGTH, so that they can demand these rights for the workers. If the workers can't get what's theirs ON THEIR OWN, it's time to organize.

Then what? Make overpriced products that no one want to buy? If their labor is so valuable, just start a new business and keep the profits to themselves. Unions should be all about increasing the productivity and value of their member's labor. But all they do is intimidate.

ZuS wrote:

Agree there, except that there needs to be a serious round of punishment dealt to people in the government and private industry who knew what they were doing and did it anyway. Also there needs to be a serious round of refunding of public school system, public hospitals, establishment of public health-care meaning a guarantee of treatment of any illness for any person residing in the US, livin wages for the workers and security for the unemployed, a comprehensive reworking of the public transport and traffic in general, infrastructure. Preferably in that order.

Some what agree, but usually what happens is the system rewards failure and laziness and punishes success and productivity. If you have a plan to avoid this scenario, let's here it.

ZuS wrote:

To get there from where we are now, nothing short of a full blown resistance movement will be sufficient.

I believe a rational system of economics can be developed, so there is no need for violence. I you can demonstrate a rational system working, I think most everyone but the crooks will support it. The rich will support social programs if they pull people out of poverty instead of rewarding low skill labor and low-productivity.

ZuS wrote:

Yea, I thought the points I read so far were written by a retreating conservative/libertarian-wannabe. Where did your "personal responsibility" dissapear to all of a sudden? Government should do this and that, what about the private industry? They had no responsibility here? But I guess you and I both understand that personal responsibility in corporations only goes so far as they are not allowed to fuck America up the ass, don't we? You and I are't so far apart after all.

I'm not conservative/liberal or socialist. I'm rationalist. Which means I support what works. I don't support welfare in the form of minimum wage, food stamps and checks for not working. I actually think they don't do enough. All they do is treat the symptom and not the disease. I do support intensive re-education programs for people that ask for help.

I'm committed to socialist principles of helping those in need. But a rational person realized that the laws of supply and demand, reward and punishment for success and failure are immutable. But most socialist are live in a fantasy world, believing that these rules can be bypassed just by passing laws and redistributing wealth.

ZuS wrote:

Maybe you should try and be a true conservative and be outraged over our private sector, instead of being a socialist like me and already acknowledging that they are some selfish motherfuckers and that we need constraints just to keep them from eating ordinary people alive. We need true conservatives to uphold values and stuff, not confused socialists like yourself. You be conservative/libertarian, I'll be the socialist, together we'll keep private sector and the government from turning us into a fascist state, how about that?

What you should realize is that it's not conservative vs. liberal, free-market vs. socialism or rich vs. poor. It's ration vs. irrational, work vs. stealing. There are greedy rich and greedy poor. There are corporations that are crooks and unions that are crooks. There are Democrat and Republican crooks. There are irrational ideas on both the conservative and liberal sides.

ZuS wrote:

Government needs to give us stability? Shit, you really are a socialist. How come you don't like the word socialism then? You like all the stuff socialist like, you think the same about the private industry, how come you don't think socialism is a good idea? Or at least some mild form of strongly regulated private industry and stable social environment? You don't like people or something?

Most people that want to get rid of the Fed and it's market manipulation and illegal taxation are libertarian and conservative.

I don't want to be associated with people that want to reward failure and punish success. I don't want to be associated with conservatives that don't offer any temporary help.

Socialism that enables people to get out of poverty and live a self-sufficient, free life is good. Welfare that is temporary and solves problems is good. Socialism that rewards failure/punishes success and create permanent dependency is bad.

 

 

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EXC wrote:The fact that

EXC wrote:

The fact that individuals don't buy their own insurance is a reason for high medical costs. If you make public funds available to pay for medical expenses, the medical industry will just raise the price of medical care and introduce more expensive 'cures'. So more public funds will be required until the state goes bankrupt.

Unless the government runs the medical industry, and sets pricing itself. Eye-wink

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Vastet wrote:Unless the

Vastet wrote:

Unless the government runs the medical industry, and sets pricing itself. Eye-wink

Why don't the laws of supply and demand setting the price apply to the medical and medical insurance industries?

How does the goverment get good and cost effective technology to be developed if prices are fixed?

 

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EXC wrote:Vastet

EXC wrote:

Vastet wrote:

Unless the government runs the medical industry, and sets pricing itself. Eye-wink

Why don't the laws of supply and demand setting the price apply to the medical and medical insurance industries?

How does the goverment get good and cost effective technology to be developed if prices are fixed?

 

Simple, you don't fix the price, and you get rid of insurance company vampires. You set the price at cost, which will obviously variate year to year. Probably month to month, if not day to day. 

For new technologies that will mean exhorbitant costs, mostly because of R&D (which the government provides, and must recoup somehow). Which is a good thing, since many new technologies are not ready for the general population at development anyway (especially in health care, though programming is showing a similar stripe in recent years).

You use a volunteer population for testing that is aware of the risks of volunteering. The government doesn't charge them because of the risks inherrant within testing new technologies. But neither does it pay them to participate. Once the product has been confirmed as useful and safe, full scale production can begin, reducing costs significantly.

Product failures get a bit trickier, but as long as there's a program in place to ensure that people who have had bad reactions that impact their ability to work will not unduly suffer as a consequence to participation, then there's no real problem. It is volunteer based after all.

And before someone runs in and suggests you'll have a hard time finding volunteers, I'll laugh in your face here and now. People with cancer routinely involve themselves in experiments to try and destroy the cancer, regardless of risk to their own well being. They know they're going to die anyway, at least this gives them a chance of surviving. Less lethal conditions still provide a constant concern and problem to the inflicted, which means you'll still have volunteers based on agitation regarding their condition.

For older and dependable technologies, the costs are already insignificant. Most of the pharmaceuticals today cost pennies to make. Only the newest pills actually have a real cost to them. The only reason things cost so much is greed. I've heard the tired argument that profits lead to further R&D, and it's pure bullshit. Pharmaceutical companies are in the business of prolonging suffering and making money off of products that have no verifiable value. None of them have the slightest interest in actually curing health problems. Universities and colleges are still the only place you can see scientists working towards actually curing a health problem. Case in point, Stanford University. Show me a company which is working so hard on curing cancer as that University is, and I'll be shocked.

A socialist government would be unable to work towards profits at the expense of its populations health, since the populations health and happiness is a large part of what provides the government stability.

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Vastet wrote:Simple, you

Vastet wrote:

Simple, you don't fix the price, and you get rid of insurance company vampires. You set the price at cost, which will obviously variate year to year. Probably month to month, if not day to day. 

Who decided the cost if not the laws of supply and demand?

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EXC wrote:Vastet

EXC wrote:

Vastet wrote:

Simple, you don't fix the price, and you get rid of insurance company vampires. You set the price at cost, which will obviously variate year to year. Probably month to month, if not day to day. 

Who decided the cost if not the laws of supply and demand?

I will answer your long letter to me, but I will take this one now.

I am not sure why we are talking supply and demand, since the whole market system has been put out of business by short term speculation and long term plans for consolidation during crashes. But let's do it for a bit anyway.

There are some things that we do not want privatised, simply because you can not expect every single citizen to take responsibility for the prices of the supply and demand model. These are the things we all need that are crucial for our survival. This certainly goes for police, fire department, military and most certainly health industry. Can we let these extremely important functions in our society be subject to fluxuation in supply and demand? I think not.

All of these are insurrances in one form or another. Insurrance is not always a profitable business, at times when there are a lot of incidents that need coverage, many insurrance companies would be put out of business. Can we allow vital functions in our society to be put out of business by the very events they are supposed to mitigate? I think not.

Well, maybe we can guarantee the function of these vital institutions by the state, so that if any trouble arises or if people don't have money for the premiums, the state will cover the expenses? That is accidentally the plan Obama came into office with. But why have a private industry that is basically just charging extra for the CEOs and investors and the whole mess, if you are going to have the state cover the whole nation anyway? This is completely pointless, adding 30% to the cost of the insurrance just for the lawish pays these people are used to receive.

Not only that, but since the state is covering even people who don't pay for insurrance, the company would never need to compete for anything, and thus would not even need to service it's customers. It would even be able to get away with it due to it's political influence. In fact, in a system that is as corrupt as the US capital market, the biggest business in health industry at the moment is denial of coverage. So I am not even talking about some future concept, it's happening right now - get all the money you can fast, then lobby for more.

Is there no way we can handle our insurrances then? Well, yes there is. How do we handle police? Fire department? Why not health industry? Most doctors, nurses and other medical personnel in the US are for this solution, can it really be that crazy? Well, I can certify that it is not crazy at all with examples. It has been working just fine in Denmark and basically all other countries in the modern world for decades. It is by far the cheapest solution with the most choice - the patient can basically choose any hospital in the country. Is it problem-free? Compared to what US has - give me a break.

 

But to come back to what I started from - supply and demand? There is a huge demand for power, and I am afraid ordinary people of this world will have to supply a lot of blood to satisfy it. The book on microeconomics is worth about as much as the Bible in the world of reality - just another ideology to obfuscate, delude, abuse and own. Time to wake up, Mr. Rationalist.

Bill Moyers was press secretary in Johnson administration, here he is interviewing William K. Black. William is one of those guys who use to be a regulator, you should check him just for like 20 mins: http://www.pbs.org/moyers/journal/04032009/watch.html

Logic is a systematic method of coming to the wrong conclusion with confidence.