Search this Thread
Thread Tools
Post Reply
Users like you have given feedback on this thread:
To give your opinion, vote using the thumbs above.
To give your opinion, vote using the thumbs above.
Share this thread on the web:
Share this thread by Email:
Click here
 del.icio.us
StumbleUpon
Google Bookmarks
Technorati
reddit |
Yahoo! My Web
Facebook
AOL IM
|
Share this thread by Email:
Click here
Rant - We have sold our financial soul
Just announced: Fed rate is unchanged - course it's unchanged what options are left?
The followers of John Maynard Keynes have come to the end of their useful lifecycle. http://en.wikipedia.org/wiki/John_Maynard_Keynes
Unfortunate for us they are still in the ear of our government both Republicans and Dems. Briefly, Keynesians argue that the free market sometimes stumbles and the government should step in to right the wrong. The free market, like anything else in nature rights itself if left alone. Witness the Gulf oil spill as a perfect example.
Keynesians are calling for more debt to fuel more buying. These days if we inject 10 cents of debt into our economy we get 10 cents of GDP on the other side ... in other words it's not working any more! Common sense says "if it doesn't work ... you stop doing it"!
Problem is we can't afford to pay the debt we have now. If our interest rate was to increase (even by a little) this house of cards called the stock market would go into another free-fall. We have painted ourselves into a zero interest rate corner - sounds good at first but eventually the financial system needs to get paid for loaning out money.
To make things worse our government in it's wisdom set out to backstop some stupid financial moves over the years. One of the biggest bonehead moves out of the FED is the mortgage backed securities debacle. With "the people" to back them up, the banks got stupid greedy and made home loans to borrowers that can't pay back. Both lender and lendee are guilty here so don't point in one direction. Can you justify why a borrower with a monthly income of say $2000 a month gets a mortgage of $2500?? Pretty easy to see that something is going to give.
For a perfect example of what our government is trying to do, imagine yourself in the hospital after a bad accident. You have one of those machines that dole out your pain medication on demand. You feel pain and keep pressing the button but nothing happens because you already have your required meds dispensed - this is what our politicians are doing with debt.
Collectively we are the economy: Our economy is in a slow grind - simply put, we can't afford to pay off any more debt so we stop ourselves (from continued spending). The government can't seem to stop themselves?
What is it they say about doing the same thing over and over - expecting a different result?
The Keynes era has expired (probably since the 70's) and should be put to pasture like communism.... the grand experiment is over. Let the free markets do their thing and we should be out of this mess sooner than later.
end of rant
The followers of John Maynard Keynes have come to the end of their useful lifecycle. http://en.wikipedia.org/wiki/John_Maynard_Keynes
Unfortunate for us they are still in the ear of our government both Republicans and Dems. Briefly, Keynesians argue that the free market sometimes stumbles and the government should step in to right the wrong. The free market, like anything else in nature rights itself if left alone. Witness the Gulf oil spill as a perfect example.
Keynesians are calling for more debt to fuel more buying. These days if we inject 10 cents of debt into our economy we get 10 cents of GDP on the other side ... in other words it's not working any more! Common sense says "if it doesn't work ... you stop doing it"!
Problem is we can't afford to pay the debt we have now. If our interest rate was to increase (even by a little) this house of cards called the stock market would go into another free-fall. We have painted ourselves into a zero interest rate corner - sounds good at first but eventually the financial system needs to get paid for loaning out money.
To make things worse our government in it's wisdom set out to backstop some stupid financial moves over the years. One of the biggest bonehead moves out of the FED is the mortgage backed securities debacle. With "the people" to back them up, the banks got stupid greedy and made home loans to borrowers that can't pay back. Both lender and lendee are guilty here so don't point in one direction. Can you justify why a borrower with a monthly income of say $2000 a month gets a mortgage of $2500?? Pretty easy to see that something is going to give.
For a perfect example of what our government is trying to do, imagine yourself in the hospital after a bad accident. You have one of those machines that dole out your pain medication on demand. You feel pain and keep pressing the button but nothing happens because you already have your required meds dispensed - this is what our politicians are doing with debt.
Collectively we are the economy: Our economy is in a slow grind - simply put, we can't afford to pay off any more debt so we stop ourselves (from continued spending). The government can't seem to stop themselves?
What is it they say about doing the same thing over and over - expecting a different result?
The Keynes era has expired (probably since the 70's) and should be put to pasture like communism.... the grand experiment is over. Let the free markets do their thing and we should be out of this mess sooner than later.
end of rant
Last edited by Spartanicus; 06-23-2011 at 07:35 AM..
Like there ever was a free market. You'd just like your turn to do an experiment. No thanks!
