BenzWorld Senior Member
Date registered: Sep 2008
Mentioned: 0 Post(s)
Quoted: 9 Post(s)
I too am all for lending a hand to a company for the sake of preserving an industry and saving jobs. However, I am also in favor of justice.
I made mention in other threads that I am contra most of the pupulace in my opinion we ought to save the automobile manufacturers but let the banks fail. As I said in those threads, I view the autos as what they refer to civilian casualties in the military: collateral damage.
I will admit Detroit was losing its leading position in the auto industry in part to more competitors (koreans and chinese) as well as cheaper labor abroad. However, these companies were still viable. The nail in the coffin was the freezing of the credit markets and the fact no one can get financing including these companies. Yet our government, actually it's the Fed (which is anything but federal) and the treasury, are bailing out whatever financial firm so much as sneezes but we are going to let the only value added manufacturing industry left in this country die. Way to think it through America.
We now have these massive financial institutions which are burdened by toxic debt being propped up by the government with its implicit guarantee. But what is backing the government? Our per annum GDP is ~$1 trillion in this country and we run a budget deficit in the $500 billion range. So the difference between what our government spends and what it brings in in taxes is almost half of all the goods and services produced in this country. We're now talking about a budget deficit of $1 trillion next year with all these bailouts and this is not to mention the $2 trillion the Fed and Treasury sent out the back door. How are we paying for this? We're not, it is simply being printed which is akin to issuing more shares in a secondary offering. Printing more money is simply diluting the purchsing power of the existing dollars.
So here we are, on the verge of hyperinflation and we are issuing more and more debt. Isn't debt at the root cause of all this? The fact this country didn't produce jack squat but a few Hollywood movies is why we find ourselves on the brink of financial armageddon and going back to the bartering system.
I feel we should let the financial institutions fail. The strong will survive and new ones with a moral code of ethics will emerge and fill the void. Purge the system of the credit. Let deflation set in. At least the measure of our labor -- the dollar -- will finally purchase something rather than every one of us having to be more and more productive just to maintain the status quo. Instead we are running the printing presses at the Treasury 24 hours a day and in a couple years will be facing inflation that makes us wish we were back in "glory days" of the 1970s.
Fasten your seatbelts. We're going down.
When devils will the blackest sins put on, they do suggest, at first with heavenly shows - Othello
Last edited by cozette; 11-27-2008 at 12:08 AM.