The Great Depression Of 2008 - Page 2 - Mercedes-Benz Forum

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post #11 of 86 (permalink) Old 10-26-2008, 11:14 PM
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Unfortunately, it's also brain-dead to continue trying to prop up this debt-based house of cards we have now, repeatedly rewarding the very same bad actors who have brought our nation to this pretty pass in the first place.

There's going to be a world of hurt any way you look at it. Denniger's point, and to some extent Paul's, is that constructive reform can only happen if the old, corrupt system is flushed clean. Yes it's more than an upheaval, it's a cataclysm. But it would offer the signal virtue of setting things somewhat to rights. What we're doing now doesn't offer that; quite the contrary. Not to mention, it's not working.
Viva la revolucion, LOL.
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post #12 of 86 (permalink) Old 10-26-2008, 11:14 PM
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My perception is that a 'lost decade' is what's now in store for us with the bailouts-upon-bailouts, all financed by additional debt. And that then we'd have the collapse anyway. Our decade will be worse than that of the Japanese because we don't have benefit of personal savings as they did.

You're right, Bear, it's hard to fathom in advance how dislocating the cataclysm would be now. But just as banks should have been permitted to fail, with NO changes in the rules, the same should happen in other industries. We'd have a collapse in many market sectors.

And what would happen next? We'd start to rebuild, only on firm financial footings. The result would be immeasurably stronger than what we're trying to cobble together now. Everything now being arranged in Washington and Wall Street is in the interests of the wealthy and powerful whose fingers are in all the cakes. How could it be otherwise? They're naturally using their considerable power to protect their interests.

Instead of throwing trillions of borrowed dollars down the well, mortgaging our children's future, we could use our considerable resources to help commerce start anew. Sure there will be dislocations--traumatic ones--but the faith & credit of the federal government would still be intact, instead of under grave threat as it now is. Because once that is gone, all else follows right down the drain. And how do you recover from that?

Last edited by Marsden; 10-26-2008 at 11:17 PM. Reason: typo!
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post #13 of 86 (permalink) Old 10-26-2008, 11:16 PM
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post #14 of 86 (permalink) Old 10-26-2008, 11:44 PM
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My perception is that a 'lost decade' is what's now in store for us with the bailouts-upon-bailouts, all financed by additional debt. And that then we'd have the collapse anyway. Our decade will be worse than that of the Japanese because we don't have benefit of personal savings as they did.

You're right, Bear, it's hard to fathom in advance how dislocating the cataclysm would be now. But just as banks should have been permitted to fail, with NO changes in the rules, the same should happen in other industries. We'd have a collapse in many market sectors.

And what would happen next? We'd start to rebuild, only on firm financial footings. The result would be immeasurably stronger than what we're trying to cobble together now. Everything now being arranged in Washington and Wall Street is in the interests of the wealthy and powerful whose fingers are in all the cakes. How could it be otherwise? They're naturally using their considerable power to protect their interests.

Instead of throwing trillions of borrowed dollars down the well, mortgaging our children's future, we could use our considerable resources to help commerce start anew. Sure there will be dislocations--traumatic ones--but the faith & credit of the federal government would still be intact, instead of under grave threat as it now is. Because once that is gone, all else follows right down the drain. And how do you recover from that?
Well, the kid's future is already mortgaged, that has been a given for a couple of years. This additional $2-5T will just pile on. I don't see everything being arranged for only the wealthy and powerful. I think that might be where we differ. After getting pissed at all the adders in the 451 page bill that I read, I realized that it really was NOT intended just to cover the folks on Wall Street. They will benefit. But if it is done CORRECTLY, and that is really a big gamble, there will be much less pain down the pike. We can, as a country establish an instrument to address the soon to be $15T in debt if we have the will. The cost to clean slate this country will be 5X that in the long run. And we will set back our Energy independence goals by two decades, our healthcare goals will vaporize [and that will include Social Security and Medicare which will have their funds just shrink away].

I like the clean slate approach "IN THEORY". It would be the way to go. It would make us a stronger, better, more competitive country. The problem is, I just don't see how we can get there from here. Even a cataclysmic crash will not result in a "clean slate". It will have collateral damage and repercussions that propagate everywhere. The faith and confidence in this country will be shaken to the core and, unlike our parents and grandparents who went through the depression, the current generations don't have a clue what "depression" means. [I am fortunate that my parents grew up in the coal fields of Eastern Kentucky in the depths of the Depression and insured that I understood the weight of its dangers.]



In the big picture, what I believe needs to happen is going to be a hybrid of the bailout. There is going to need to be a much more complete conversation on the subject as soon as this election is over. Until November 5, nobody is willing to put their balls on the table and commit. After Wednesday, hopefully that will occur, no matter who wins and no matter what the new balance. This needs 100% focus and everyone needs to call their representatives and tell them to get their ass back to DC until it is FIXED. And fixed does not necessarily mean MORE MONEY.

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post #15 of 86 (permalink) Old 10-26-2008, 11:50 PM
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Tough question: "Which way is up."
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post #16 of 86 (permalink) Old 10-27-2008, 12:49 AM
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Our discussion is necessarily abstract and simplistic. We don't have the time, the inclination, or (in my case at least) the expertise to delve too deeply into this fiasco, its causes, and probable effects. But what we must do, to the best of our ability, is figure out how best to protect ourselves and our loved ones. This is why I asked for opinions in the other thread.

Our senators and representatives, with a few exceptions, are themselves anything but expert in financial matters. They have to spend most of their time and energy on political concerns. What you describe, Bear, is much closer to what I expect than what I described. But notice, for example, that even the more responsible aspects of the current bailouts--the equity positions in banks being taken by Paulson, for example--seem to carry no implications on how the capital infusions are put to work, or not.

That is, we've given them our money but haven't told them how to use it. This is what should be expected from the current administration. But the result is throwing money down a well. If the banks elect to hoard the cash to protect themselves, because they are so desperate--and they are--no public good derives from the effort. Instead, the malefactors are rewarded yet again. These stopgap measures--these band-aids--may be irrelevant at best. Part of my own financial awakening these past 18 months has been to realize that our collective situation really can spiral out of control. It's not just scare tactics. It really can happen.

I don't think we're addressing it, and our political structure may simply prevent it. Barack is smart enough to figure this out. Whether or not he will have the political courage, and the political capital, to take effective action is a separate question. It would mean taking on the entire commercial establishment, and much of the political. Political suicide? McCain, as you know, isn't even on the playing field.

Meanwhile, how do we protect ourselves, if severe inflation--as is expected--replaces the current deflation? Much of the country has just suffered a body blow to its finances. How to prevent the insidious, invisible taxation of inflation from robbing us of what we have left? I can't see a likely outcome which doesn't involve the (greatly accelerated) destruction of the dollar. This death by a thousand blows would seem to be the politically expedient 'solution'.



PS: It's past our bedtime... we can continue this tomorrow
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post #17 of 86 (permalink) Old 10-27-2008, 01:54 PM
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Our discussion is necessarily abstract and simplistic. We don't have the time, the inclination, or (in my case at least) the expertise to delve too deeply into this fiasco, its causes, and probable effects. But what we must do, to the best of our ability, is figure out how best to protect ourselves and our loved ones. This is why I asked for opinions in the other thread.

Our senators and representatives, with a few exceptions, are themselves anything but expert in financial matters. They have to spend most of their time and energy on political concerns. What you describe, Bear, is much closer to what I expect than what I described. But notice, for example, that even the more responsible aspects of the current bailouts--the equity positions in banks being taken by Paulson, for example--seem to carry no implications on how the capital infusions are put to work, or not.

That is, we've given them our money but haven't told them how to use it. This is what should be expected from the current administration. But the result is throwing money down a well. If the banks elect to hoard the cash to protect themselves, because they are so desperate--and they are--no public good derives from the effort. Instead, the malefactors are rewarded yet again. These stopgap measures--these band-aids--may be irrelevant at best. Part of my own financial awakening these past 18 months has been to realize that our collective situation really can spiral out of control. It's not just scare tactics. It really can happen.

I don't think we're addressing it, and our political structure may simply prevent it. Barack is smart enough to figure this out. Whether or not he will have the political courage, and the political capital, to take effective action is a separate question. It would mean taking on the entire commercial establishment, and much of the political. Political suicide? McCain, as you know, isn't even on the playing field.

Meanwhile, how do we protect ourselves, if severe inflation--as is expected--replaces the current deflation? Much of the country has just suffered a body blow to its finances. How to prevent the insidious, invisible taxation of inflation from robbing us of what we have left? I can't see a likely outcome which doesn't involve the (greatly accelerated) destruction of the dollar. This death by a thousand blows would seem to be the politically expedient 'solution'.



PS: It's past our bedtime... we can continue this tomorrow
I think I had already crashed last night.

I do agree that the checks that Uncle is giving out need to have strings, or in reality leashes attached. That is the only way to insure that ma and pa get their monies worth. We bought this thing, whether we like it or not, we really better focus on getting it to function correctly.

I am more and more of the opinion that we need to push HARD to get a Senate Select panel to ride herd on this project full time. It would be a great project for the loser and Clinton to co-chair. And it needs to start next Wednesday and go EVERY DAY until there is resolution [and not Resolution Trust]. There needs to be investigations that are fasttracked against each and every company that is involved, both American and foreign and each and every lobbyist and congressman that has been involved in decision making. THAT is going to be needed to start rebuilding confidence in this government and in our financial systems. We need a velvet hammer, without the velvet.

McBear,
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post #18 of 86 (permalink) Old 10-27-2008, 02:01 PM
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Very good.

Now I need to go buy some gold and bury it.
Or you can just smoke weed and not worry about it, Libertarians are all about that too.

Recall that earlier generations faced down fascism and communism not just with missiles and tanks, but with sturdy alliances and enduring convictions. They understood that our power alone cannot protect us, nor does it entitle us to do as we please. Instead, they knew that our power grows through its prudent use; our security emanates from the justness of our cause, the force of our example, the tempering qualities of humility and restraint.

-President Barack Obama, 1st Inaugural address
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post #19 of 86 (permalink) Old 10-27-2008, 02:07 PM Thread Starter
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^ Typical democrat psyche -- the answer to too much meddling is more meddling.

"If spending money you don't have is the height of stupidity, borrowing money to give it away is the height of insanity." -- anon
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post #20 of 86 (permalink) Old 10-27-2008, 02:07 PM
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Or you can just smoke weed and not worry about it, Libertarians are all about that too.

Merge the 2 buy Columbian Gold.........
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