Do you think Obama has had enough time to help repair things?

[543 Double Play]

I was just wondering your thoughts about this. I have heard the argument that he needs time. Well, it has been almost a year, is the country any better off now that he is in office? Do you see improvements?

[RicoVacilon]

I was just wondering your thoughts about this. I have heard the argument that he needs time. Well, it has been almost a year, is the country any better off now that he is in office? Do you see improvements?

I think it's pretty obvious the economy is turning around. What the price for that turn around will be is still up in the air.

He hasn't done much of anything else though.

[543 Double Play]

I think it's pretty obvious the economy is turning around. What the price for that turn around will be is still up in the air.

He hasn't done much of anything else though.

Do you think the economy is turning around because of all the money that was pumped into it with the bailouts? Or do you think it was a result of his economic gameplan?

[Nevada_Ballin]

Considering how bad things were and the overall situation he wanted to be elected into, I say he's made some progress. But those problems (2 wars, economy, health care reform, etc) aren't things that can be done in a year. He gets a lot of pushback all around (some well-deserved) but he does effort to do most of what he said he wanted to do.

Maybe for some Armchair POTUS's he has had enough time but in reality, there's a lot on that Executive Office plate.

.

[RicoVacilon]

Do you think the economy is turning around because of all the money that was pumped into it with the bailouts? Or do you think it was a result of his economic gameplan?

No idea. I think it would have been turning around by now anyway even if no one had done anything.

[theanalogkid]

Do you think the economy is turning around because of all the money that was pumped into it with the bailouts? Or do you think it was a result of his economic gameplan?

I don't see how excessive lending and spending are going to solve the problem of excessive lending and spending. The economy would be on a much faster recovery right now if the government had let those companies fail. TARP wasn't Obama's doing though so I can't blame him for that. He can be blamed for a continuance of George W. Bush economic policies though. The Bush Administration heavily taxed Americans not through actual percentages from your income or property, but through inflation which isn't thought about by people, Obama is doing the same.

I don't even think things would have been better under McCain. Lets not forget McCain suggested that the government should buy up bad mortgages from homeowners, which would have cost trillions of dollars to do. So much for being fiscally conservative.

[resnor]

The irony, Nevada, is that Obama basically promised to turn everything around quickly. Many of us said it was not possible...but you voted for him anyway. Now, here you are a year later, saying that he has too much to do...basically, everything he ran on was a sham, and too many Americans fell for it. Nothing new in a snake oil salesman, though.

[RicoVacilon]

The irony, Nevada, is that Obama basically promised to turn everything around quickly. Many of us said it was not possible...but you voted for him anyway. Now, here you are a year later, saying that he has too much to do...basically, everything he ran on was a sham, and too many Americans fell for it. Nothing new in a snake oil salesman, though.

I also feel the opposite happening though--people are ignoring data that says things ARE turning around because they want a reason to hate Obama.

Almost every number except unemployment is showing serious improvement, but what do the anti-Obama people point to? Unemployment. Which is historically one of the last numbers to turn around and a pretty bad barometer.

Anyways, just sayin.

[killacs]

The projected deficit is going to kill this country if it stays like that through his term. Good bye dollar hello Amero

[jerseyjay14]

I was just wondering your thoughts about this. I have heard the argument that he needs time. Well, it has been almost a year, is the country any better off now that he is in office? Do you see improvements?

are we better off then a year ago - not really

did he have enough time to repair things - not really

Washington isnt a place that is set up to make changes or at least quick ones. which is why his whole "change" campaign never really made any sense to me

[RSherryJr]

The projected deficit is going to kill this country if it stays like that through his term. Good bye dollar hello Amero

Times of war always spark deficits. No country puts peak war expenses in its annual budget. Then war hits and it is hard enough to sell your citizens on going to war much less taxing them for it. The good news is that peacefull times bring budget surplus like in the clinton years when there was actually a surplus. The printing of money for TARP is all relative as the country will prolly make money on it like they did during the S&L crisis. The rest of the money was mostly spent on things that will almost immediatly be sent back to the gov't in tax revenue.

But to get back to the original questions. I did not buy that Obama would turn things around as quickly as he stated and I feel this is going about as I thought it would. I think that the market will comeback quicker than people think.

[killacs]

Times of war always spark deficits. No country puts peak war expenses in its annual budget. Then war hits and it is hard enough to sell your citizens on going to war much less taxing them for it. The good news is that peacefull times bring budget surplus like in the clinton years when there was actually a surplus. The printing of money for TARP is all relative as the country will prolly make money on it like they did during the S&L crisis. The rest of the money was mostly spent on things that will almost immediatly be sent back to the gov't in tax revenue.

But to get back to the original questions. I did not buy that Obama would turn things around as quickly as he stated and I feel this is going about as I thought it would. I think that the market will comeback quicker than people think.

1) Clinton times weren't 100% peaceful, you have to factor the technology bubble in there

2) The FED printed a ton of money, you do realize that the FED charges the US interest on that money right?

3) Foreign countries own most of the treasury bills, we are phugged when they are coming to collect and won't accept more T-Bills as payment.

It is only a matter of time before the dollar is gone, the ME war won't be over for a long time it will be this generation's Vietnam and then the move toward 1 global currency will slowly take place in this hemisphere. First the continents must come up with their currency then the hemispheres then world though they may just skip step 2.

[YoungVito]

Liberals are gonna say "Hell no" and get offended at the fact that you asked, yet at the same time ignoring the "Freshman president" mistakes that were made this year. Conservatives on here are gonng say "Of course he has, because he said he would turn it around quickly" (despite any evidence to support this claim)

While I understand and respect the spirit of this question, I feel that perhaps this is a better question to be asked idk...IN 2012. Unfortunately, since the '00 election, the 24-hr news cycle, and forums such as these...our country APPEARS to be INSANELY POLORIZED.

[RSherryJr]

1) Clinton times weren't 100% peaceful, you have to factor the technology bubble in there

2) The FED printed a ton of money, you do realize that the FED charges the US interest on that money right?

3) Foreign countries own most of the treasury bills, we are phugged when they are coming to collect and won't accept more T-Bills as payment.

It is only a matter of time before the dollar is gone, the ME war won't be over for a long time it will be this generation's Vietnam and then the move toward 1 global currency will slowly take place in this hemisphere. First the continents must come up with their currency then the hemispheres then world though they may just skip step 2.

1) Dropping two scud missles and a few air raids over Bosnia does not qualify as a war.

2) See 3

3) There is nothing wrong with national debt. It is a little out of hand at the moment dues to excessive social security and medicare drains on the system as well as the war - but other than that it is pretty manageable. We pay back those T-Bills at such a low interest rate that it is like they are paying us. It doesn't even keep up with inflation. It also gives China incentive to see us succeed.

[killacs]

1) Dropping two scud missles and a few air raids over Bosnia does not qualify as a war.

2) See 3

3) There is nothing wrong with national debt. It is a little out of hand at the moment dues to excessive social security and medicare drains on the system as well as the war - but other than that it is pretty manageable. We pay back those T-Bills at such a low interest rate that it is like they are paying us. It doesn't even keep up with inflation. It also gives China incentive to see us succeed.

1) I didn't say it was a war I just said it wasn't 100% peaceful

2) There is a lot wrong with national debt. You're crazy if you think otherwise. What concerns the most is not that we have debt its the rate at which it is increasing. Something is going to have to give sooner or later. The bubbles (housing was the last one, what is the next one silver?) can only do so much eventually the dollar is going to get weak enough to the point where it has to be replaced.

[RSherryJr]

1) I didn't say it was a war I just said it wasn't 100% peaceful

2) There is a lot wrong with national debt. You're crazy if you think otherwise. What concerns the most is not that we have debt its the rate at which it is increasing. Something is going to have to give sooner or later. The bubbles (housing was the last one, what is the next one silver?) can only do so much eventually the dollar is going to get weak enough to the point where it has to be replaced.

When you go to purchase a home you take out debt because inflation alone will increase your investment. The same economic principles hold true with national debt. It is an investment in our country. This is capitalism so you will always have bubbles. Get used to it. The major problem like I said earlier is the war, followed by SS, and Medicare growing at an alarming pace. Straightening out immigration and ending the war will create more working, tax paying americans to support these systems. The countries population is retiring fast and it will only get faster over the next 20 years. The dollar is not in as much trouble as you think. It is still a very strong currency that is going through a bubble of its own thanks to a few unsastainable thing happening right now.

[RicoVacilon]

I'm not sure how all this talk about the dollar's demise got started. It sure seems alarmist though.

[Gtrght77]

I'm not sure how all this talk about the dollar's demise got started. It sure seems alarmist though.

It is just anti-Obama people hoping everything goes bad so they can say " See I told you so".

Even if it does get better the same people will continue to say it will get worse.

[theanalogkid]

It is an investment in our country. This is capitalism so you will always have bubbles. Get used to it. The major problem like I said earlier is the war, followed by SS, and Medicare growing at an alarming pace. Straightening out immigration and ending the war will create more working, tax paying americans to support these systems. The countries population is retiring fast and it will only get faster over the next 20 years. The dollar is not in as much trouble as you think. It is still a very strong currency that is going through a bubble of its own thanks to a few unsastainable thing happening right now.

Oh where to begin.

When you go to purchase a home you take out debt because inflation alone will increase your investment. The same economic principles hold true with national debt.

Inflation doesn't increase your investment. Inflation is the increase of the money supply. It dilutes your money and thus dilutes your investment. If inflation increased your investment, then the Treasury wouldn't both issuing TIPS, now would they?

Higher prices are an effect of inflation. You can have inflation without rising prices if it is canceling out a downward pressure on prices. It is also a myth that houses retain their value, they don't. They are subject to supply and demand like everything else, among other factors.

This is capitalism so you will always have bubbles. Get used to it.

Bubbles are not a component of capitalism. Bubbles are created by the manipulation of interest rates and a government which creates tax incentives in certain sectors but not others.

It is still a very strong currency that is going through a bubble of its own thanks to a few unsastainable thing happening right now.

Strong is relative. Strong vs what?

It is just anti-Obama people hoping everything goes bad so they can say " See I told you so".

There was talk of the dollar's demise before Obama even took office. So I don't think what your saying is true.

[RicoVacilon]

Even if it does get better the same people will continue to say it will get worse.

That's starting to be the impression I'm getting. I'm luke warm on Obama, so I'm not exactly biased, but it certainly seems like there is a large group of people claiming the sky is falling merely because they want it blame Obama for it. Yet meteorologists continue to say the sky is doing just fine. So not only are they pulling the "oh you just wait" card, but they're pre-empting it with the "things are already crappy but no one is telling you" card.

[RicoVacilon]

Inflation is the increase of the money supply.

This really isn't what inflation is. That definition was given its funeral several decades ago. You can have inflation or deflation without any change in the amount of money circulating--either real or imagined.

Bubbles are created by the manipulation of interest rates and a government which creates tax incentives in certain sectors but not others.

Not at all. Bubbles are when a certain sector is over-valued and is getting ready for a correction. This happens independent of interest rates or government incentives.

Quit trying to frame everything through your Ron Paul glasses. He's fringe for a reason.

[theanalogkid]

This really isn't what inflation is. That definition was given its funeral several decades ago. You can have inflation or deflation without any change in the amount of money circulating--either real or imagined.

If prices are moving up and down outside of an increase or decrease in the money supply, the it isn't inflation or deflation. Prices move up and down all the time for other reasons. Walmart isn't a deflationary force is it? It does cause people to pay less for things at their store (and even causes other retailers to pay less) The Internet isn't a deflationary force either, but you generally pay less than you would in a retail store.



Not at all. Bubbles are when a certain sector is over-valued and is getting ready for a correction. This happens independent of interest rates or government incentives.

This housing bubble was very much caused by government intervention (Ownership Society anyone?) and ultra low interest rates (1% in 2003). Not to mention giving large tax breaks to people with homes as well as some other government regulation. So your claim that it happens "independent of interest rates or government incentives" is wrong. There's a lot of video showing how the government played a role in the housing bubble. PBS even did a documentary which the name escapes me at this moment too.

[RSherryJr]

If prices are moving up and down outside of an increase or decrease in the money supply, the it isn't inflation or deflation. Prices move up and down all the time for other reasons. Walmart isn't a deflationary force is it? It does cause people to pay less for things at their store (and even causes other retailers to pay less) The Internet isn't a deflationary force either, but you generally pay less than you would in a retail store.




This housing bubble was very much caused by government intervention (Ownership Society anyone?) and ultra low interest rates (1% in 2003). Not to mention giving large tax breaks to people with homes as well as some other government regulation. So your claim that it happens "independent of interest rates or government incentives" is wrong. There's a lot of video showing how the government played a role in the housing bubble. PBS even did a documentary which the name escapes me at this moment too.

I'm not trying to be a jerk - but you really need to take an economics course. Interest rates are only one force in housing. Housing is driven by supply and demand, replacement cost or current construction cost, the credit markets and finally the benefit of tax write offs in purchasing vs renting. All things play a role in the overall housing market.

[theanalogkid]

I'm not trying to be a jerk - but you really need to take an economics course. Interest rates are only one force in housing. Housing is driven by supply and demand, replacement cost or current construction cost, the credit markets and finally the benefit of tax write offs in purchasing vs renting. All things play a role in the overall housing market.

Did I just not mention most of what you just stated. lol.

[RSherryJr]

Oh where to begin.



Inflation doesn't increase your investment. Inflation is the increase of the money supply. It dilutes your money and thus dilutes your investment. If inflation increased your investment, then the Treasury wouldn't both issuing TIPS, now would they?

Higher prices are an effect of inflation. You can have inflation without rising prices if it is canceling out a downward pressure on prices. It is also a myth that houses retain their value, they don't. They are subject to supply and demand like everything else, among other factors.



Bubbles are not a component of capitalism. Bubbles are created by the manipulation of interest rates and a government which creates tax incentives in certain sectors but not others.



Strong is relative. Strong vs what?



There was talk of the dollar's demise before Obama even took office. So I don't think what your saying is true.

Jeez, first off houses are not simply a matter of supply and demand. There is also the cost to put up a house and many other factors that play a role in the "value" of a house. You sound like the people who used to say housing would continue to go up no matter what. This is not the case either. The markets are cyclical because we have a capatalist system. Bubbles are not created by the manipulation of interest rates - you couldn't be more wrong. Speculation causes bubbles. Again, please take an economics course because right now you sound like someone who read one article on the subject and now thinks they know it all.

[theanalogkid]

Jeez, first off houses are not simply a matter of supply and demand.

I never said that, I state there were other factors involved so that's a strawman fallacy.

You sound like the people who used to say housing would continue to go up no matter what.

I guess I should quote myself because you clearly can't read.

It is also a myth that houses retain their value, they don't.

The markets are cyclical because we have a capatalist system. Bubbles are not created by the manipulation of interest rates - you couldn't be more wrong.

Markets are cyclical because of the Federal Reserve system and government intervention. You couldn't be more wrong, keep believing the Keynesian BS though. Too bad Keynes was disproven in the 1970s when stagflation hit and Keynesian economics couldn't account or explain it.


Speculation causes bubbles. Again, please take an economics course because right now you sound like someone who read one article on the subject and now thinks they know it all.

Speculators are an easy target to blame for problems, but they aren't the cause of bubbles, and in fact speculators play an important role of bring liquidity to illiquid markets and keep the bid/ask spreads narrow. Speculators didn't cause oil to spike. Maybe the government shouldn't destroy the dollar and restrict the supply of oil and it wouldn't be so expensive. More Keynesian/Political BS to try and deflect the blame off of the ones that are actually responsible.

If you want to blame speculators for forming bubbles, then you have to blame people speculating whether or not humans are causing global warming for melting the ice caps.

[RSherryJr]

I never said that, I state there were other factors involved so that's a strawman fallacy.



I guess I should quote myself because you clearly can't read.





Markets are cyclical because of the Federal Reserve system and government intervention. You couldn't be more wrong, keep believing the Keynesian BS though. Too bad Keynes was disproven in the 1970s when stagflation hit and Keynesian economics couldn't account or explain it.



Speculators are an easy target to blame for problems, but they aren't the cause of bubbles, and in fact speculators play an important role of bring liquidity to illiquid markets and keep the bid/ask spreads narrow. Speculators didn't cause oil to spike. Maybe the government shouldn't destroy the dollar and restrict the supply of oil and it wouldn't be so expensive. More Keynesian/Political BS to try and deflect the blame off of the ones that are actually responsible.

If you want to blame speculators for forming bubbles, then you have to blame people speculating whether or not humans are causing global warming for melting the ice caps.

So the dollar is now stronger than two years ago when oil prices were so high? Becuase you are stating that there is a direct correlation correct? I'm not blaming speculators alone for driving markets up - just saying that they are a major player. Finally, Keynes was proven correct in 2007. But lets get back to how debt is bad and the dollar is headed for ruin. Btw, the euro was created to help make it easier to do business across europe. Europe needed to do business like the US does, and that is why it was created. As long as the US is so rich in natural resources the dollar is going noplace. Buy the dollar long.

[RicoVacilon]

This housing bubble was very much caused by government intervention (Ownership Society anyone?) and ultra low interest rates (1% in 2003).

But you weren't talking about THIS bubble. . . you were talking about bubbles.

[RSherryJr]

Did I just not mention most of what you just stated. lol.

You said bubbles are created by gov't manipulating interest rates.

[RicoVacilon]

Markets are cyclical because of the Federal Reserve system and government intervention.

Wow. This really shows a true ignorance for basic economic principles.

[RicoVacilon]

Again, please take an economics course because right now you sound like someone who read one article on the subject and now thinks they know it all.

And that article was on Ron Paul's website. :D

[kevin21boston]

Bubbles are the product of emotion and greed. If you look at bubbles throughout history the common theme is that people had no idea what the hell they were thinking.

[RicoVacilon]

Bubbles are the product of emotion and greed. If you look at bubbles throughout history the common theme is that people had no idea what the hell they were thinking.

Irrationality plays a part, I believe. Mob mentality type of deal.

[theanalogkid]

So the dollar is now stronger than two years ago when oil prices were so high? Becuase you are stating that there is a direct correlation correct? I'm not blaming speculators alone for driving markets up - just saying that they are a major player. Finally, Keynes was proven correct in 2007. But lets get back to how debt is bad and the dollar is headed for ruin. Btw, the euro was created to help make it easier to do business across europe. Europe needed to do business like the US does, and that is why it was created. As long as the US is so rich in natural resources the dollar is going noplace. Buy the dollar long.

How does two people taking opposite positions drive the price of oil up? Derivatives are a zero sum game. It's impossible for them to drive prices up. Demand for oil is outpacing supply, and the dollar has less purchasing power due to the Fed creating more money which dilutes the value of the current supply which causes prices to rise. Last time I checked oil is once again rising. http://www.wtrg.com/daily/crudeoilprice.html

Lol, how was Keynes proven right in 2007? Seems they were no where to be found when the bubble at the beginning and peak of the bubble. The fact is they aren't happy when the government isn't spending and intervening so they like it when the Fed made easy credit available and when the Federal government wrote out $300 checks to people.

One of the core tenets of Keynesian economics is that the government must replace reductions in private sector demand with public sector demand to push demand up to the pre-reduction levels. However, that level of demand might not be correct.

So what is the government doing today. Trying that same flawed strategy, trying to push housing prices up with tax credits and the like (not that tax credits are bad, pushing them only in a few sectors are though because they help create bubbles) despite having an over-excess supply of houses. They are trying to re-inflate the housing bubble, when a correction should be taking place.

How's that Keynesian deficit spending stimulus working? It's not. Consumer spending isn't the driver of economic growth, production is. So trying to stimulate consumer spending as a means for recovery is a flawed strategy. How about TARP which is a Keynesian type program? How about those "automatic stabilizers" helping the recovery?

But you weren't talking about THIS bubble. . . you were talking about bubbles.

Bubbles are similar to each other in their basic causes. The dot-come bubble was spurred by the manipulation of interest rates as well. Easy credit was made available at the start of the bubble, and ended in 2000 when the Fed raised rates. You can go back and look at any bubble since the Fed inception and you'll see similar characteristics among all of them.

Japan had a similar bubble to what we have now caused by artificially low interest rates and then they tried to raise them to pop the bubble. They tried the Keynesian approach to solving it, but it failed. Then they tried monetarist approach, and that also hasn't worked. Their banks were burdened with bad debt, but the government started guaranteeing their loans, and wouldn't let them fail. They still haven't recovered.

This isn't hard to see what the Fed's role in forming bubbles are. When the Fed lowers interest rates below the natural level, it creates a distortion. First, no one wants to save because the rate of interest and since the Fed lowers the interest rates though Open Market Purchases, thus increasing the money supply, they're will be an increase in prices making the money in the bank worth less.

Secondly, businesses which borrow money for projects would mistakenly think their capital projects are more sustainable than they really are.

So while this artificial credit is being created it creates a boom which of course everyone likes, but since it's non-sustainable since 'price stability' is one of the jobs of the Federal Reserve, and debasing the currency causes higher prices (aka the hidden inflation tax) they have to raise interest rates, so those projects they thought would be sustainable no longer are.

So you can keep telling me I'm wrong, but in a few years we will see. It's likely that the government is just going to continue to try and paper over this recession, in which case an even bigger problem will be coming down the road.

Bubbles are the product of emotion and greed. If you look at bubbles throughout history the common theme is that people had no idea what the hell they were thinking.

Yeah, and having artificially low interest rates causes them to do stupid things. If the real interest rate was 10% and the Fed Reserve artificially lowered it to 3% suddenly your projects that you want to undertake were not profitable at the true interest rate of 10% now appear to be profitable at the fake interest rate of 3%. So it's pretty easy to see why people appear to look like they have no idea what they are doing, and in many cases that is true regardless of the interest rate. Some people are misled by these false interest rates.

[TheRealist]

How does two people taking opposite positions drive the price of oil up? Derivatives are a zero sum game. It's impossible for them to drive prices up. Demand for oil is outpacing supply, and the dollar has less purchasing power due to the Fed creating more money which dilutes the value of the current supply which causes prices to rise. Last time I checked oil is once again rising. http://www.wtrg.com/daily/crudeoilprice.html

Lol, how was Keynes proven right in 2007? Seems they were no where to be found when the bubble at the beginning and peak of the bubble. The fact is they aren't happy when the government isn't spending and intervening so they like it when the Fed made easy credit available and when the Federal government wrote out $300 checks to people.

One of the core tenets of Keynesian economics is that the government must replace reductions in private sector demand with public sector demand to push demand up to the pre-reduction levels. However, that level of demand might not be correct.

So what is the government doing today. Trying that same flawed strategy, trying to push housing prices up with tax credits and the like (not that tax credits are bad, pushing them only in a few sectors are though because they help create bubbles) despite having an over-excess supply of houses. They are trying to re-inflate the housing bubble, when a correction should be taking place.

How's that Keynesian deficit spending stimulus working? It's not. Consumer spending isn't the driver of economic growth, production is. So trying to stimulate consumer spending as a means for recovery is a flawed strategy. How about TARP which is a Keynesian type program? How about those "automatic stabilizers" helping the recovery?



Bubbles are similar to each other in their basic causes. The dot-come bubble was spurred by the manipulation of interest rates as well. Easy credit was made available at the start of the bubble, and ended in 2000 when the Fed raised rates. You can go back and look at any bubble since the Fed inception and you'll see similar characteristics among all of them.

Japan had a similar bubble to what we have now caused by artificially low interest rates and then they tried to raise them to pop the bubble. They tried the Keynesian approach to solving it, but it failed. Then they tried monetarist approach, and that also hasn't worked. Their banks were burdened with bad debt, but the government started guaranteeing their loans, and wouldn't let them fail. They still haven't recovered.

This isn't hard to see what the Fed's role in forming bubbles are. When the Fed lowers interest rates below the natural level, it creates a distortion. First, no one wants to save because the rate of interest and since the Fed lowers the interest rates though Open Market Purchases, thus increasing the money supply, they're will be an increase in prices making the money in the bank worth less.

Secondly, businesses which borrow money for projects would mistakenly think their capital projects are more sustainable than they really are.

So while this artificial credit is being created it creates a boom which of course everyone likes, but since it's non-sustainable since 'price stability' is one of the jobs of the Federal Reserve, and debasing the currency causes higher prices (aka the hidden inflation tax) they have to raise interest rates, so those projects they thought would be sustainable no longer are.

So you can keep telling me I'm wrong, but in a few years we will see. It's likely that the government is just going to continue to try and paper over this recession, in which case an even bigger problem will be coming down the road.



Yeah, and having artificially low interest rates causes them to do stupid things. If the real interest rate was 10% and the Fed Reserve artificially lowered it to 3% suddenly your projects that you want to undertake were not profitable at the true interest rate of 10% now appear to be profitable at the fake interest rate of 3%. So it's pretty easy to see why people appear to look like they have no idea what they are doing, and in many cases that is true regardless of the interest rate. Some people are misled by these false interest rates.

Great post!

Who here actually sees above average (above 3%) real GDP growth in the next 5 to 10 years?

[RicoVacilon]

Great post if you're a Ron Paul fan boy!

Fixed it. It's actual a horrible post if you're looking for actual economic knowledge.

Markets, economies, bubbles, and busts existed before the Fed, and they'll exist after the Fed. If we take "the Fed" out of TAK's lexicon, he's not left with much to talk about.

[conviction]

Fixed it. It's actual a horrible post if you're looking for actual economic knowledge.

Markets, economies, bubbles, and busts existed before the Fed, and they'll exist after the Fed. If we take "the Fed" out of TAK's lexicon, he's not left with much to talk about.

Ron Paul called this collapse before ANYONE. Gee Ron Paul must be a dummy

[travisx1]

My president is Black.! Obama is gunna get us on the right track just watch and see he knows what hes doing

[RicoVacilon]

Ron Paul called this collapse before ANYONE. Gee Ron Paul must be a dummy

It's all kool aid. RP's is just a different flavor.

[theanalogkid]

Fixed it. It's actual a horrible post if you're looking for actual economic knowledge.

Markets, economies, bubbles, and busts existed before the Fed, and they'll exist after the Fed. If we take "the Fed" out of TAK's lexicon, he's not left with much to talk about.

Of course bubbles existed before the Fed, but you have to look at what the government was doing during these bubbles. In likely all of them, the government was intervening in some fashion.

The Fed's goal is to have stable economic growth and stable prices. Clearly it's done neither well and in fact has done the opposite of what it's suppose to. Go look at the economic data at the St. Louis Feds website, do you see a stable CPI, or 4% unemployment (which is what is considered the target rate)? No, you don't, because it's impossible for a small group of people to decide what the market is demanding or needs at any given point. It's centralized economic planning, and it doesn't work. Obama's plan of giving the Fed even more power, would have dire consequences.

Keep drinking that Keynesian kool-aid though that they teach in schools. It only done one thing, keep those in power, in power. I thought it was suppose to stop economic downturns from happening (which are really market corrections). Looks like that hasn't worked either. Each recession seems to be getting worse and worse, because they keep trying to paper over a market correction, so it keeps getting bigger and bigger each time.

[conviction]

It's all kool aid. RP's is just a different flavor.

But you know what? Republicans and Democrats have both left a bitter taste in my mouth after all the **** they've put us through this decade. Lets get some competent people into office.

[YoungVito]

I was just wondering your thoughts about this. I have heard the argument that he needs time. Well, it has been almost a year, is the country any better off now that he is in office? Do you see improvements?

Just is case y'all forgot what the ACTUAL topic of this post was. Figure I'd remind you. Carry on. :D

[RicoVacilon]

The Fed's goal is to have stable economic growth and stable prices.

This is actually the fundamental problem with every economic school/model that I can think of--they think the economy can be made static. That is impossible. Economies are inherently dynamic. The dialectic is what makes them powerful. Any attempt to bring the economy into some sort of equilibrium, whether it's Keynesian, Austrian, Chicago, or other, is fundamentally flawed.

Keep drinking that Keynesian kool-aid though that they teach in schools.

I actually don't subcribe to the Keynesian school. But that wouldn't make it as fun huh?

It only done one thing, keep those in power, in power.

Every economic model does this outside of a revolutionary one--which simply puts new people in power and then keeps THEM in power.

I thought it was suppose to stop economic downturns from happening (which are really market corrections). Looks like that hasn't worked either. Each recession seems to be getting worse and worse, because they keep trying to paper over a market correction, so it keeps getting bigger and bigger each time.

This is basically a paraphrase of what I said above (I suppose you said it first even though I didn't read it until after what I wrote--which means I paraphrased you). What you call "market corrections" are what I call dialectic. So in this sense we're basically saying the same thing.

[RicoVacilon]

Lets get some competent people into office.

That's the problem--competent people don't have the desire to run for office.

[TheRealist]

This is actually the fundamental problem with every economic school/model that I can think of--they think the economy can be made static. That is impossible. Economies are inherently dynamic. The dialectic is what makes them powerful. Any attempt to bring the economy into some sort of equilibrium, whether it's Keynesian, Austrian, Chicago, or other, is fundamentally flawed.



I actually don't subcribe to the Keynesian school. But that wouldn't make it as fun huh?



Every economic model does this outside of a revolutionary one--which simply puts new people in power and then keeps THEM in power.



This is basically a paraphrase of what I said above (I suppose you said it first even though I didn't read it until after what I wrote--which means I paraphrased you). What you call "market corrections" are what I call dialectic. So in this sense we're basically saying the same thing.

Historically, what system has granted leaders the most power? The least?

Why is there an argument here? Seems rather clear to me...I didn't see Mussolini, Hitler, Stalin or Mao exactly talking about the triumphs of the free market.

Also, it's entirely different when one masquerades as subscribing to an ideology and then applies another model's teachings. A good recent example has been Bush (hardly promoted free markets by bailouts, etc.) and you could even say Jiang Zemin and Hu Jintao (since when did increased private ownership become a tenet of Communism?)

The historical record is clear. Countries that are more economically free enjoy higher standards of living and prosper while countries that deviate from this (by institution of price controls, central economic planning, trade barriers) are less prosperous.

There lies the main point. The hardest part about the greatest system is that the maintenance of a free society is difficult since it requires a self denying ordinance to put up with temporary evils (companies failing, unemployment, etc.) on the basis of subtle understanding that intervention causes negative externalities. (Law of Unintended Consequences)

[RicoVacilon]

The historical record is clear. Countries that are more economically free enjoy higher standards of living and prosper while countries that deviate from this (by institution of price controls, central economic planning, trade barriers) are less prosperous.

The historical record on capitalism is in fact quite clear. :)

[YoungVito]

Soooo has Obama done a good job this year or what?

Just wondering...

[conviction]

The historical record on capitalism is in fact quite clear. :)

what fact is that and why

[conviction]

That's the problem--competent people don't have the desire to run for office.

Who can blame them

[RicoVacilon]

what fact is that and why

That is sucks. It just sucks less than any model that has been given a chance. So we need to look for other models that haven't been given a chance yet.

I find it interesting though that in the "historical record" TR leaves out China. China is "communist" yet they own us. Hmm. . .

[theanalogkid]

That is sucks. It just sucks less than any model that has been given a chance. So we need to look for other models that haven't been given a chance yet.

I find it interesting though that in the "historical record" TR leaves out China. China is "communist" yet they own us. Hmm. . .

I don't think socialism (I don't believe China is even socialist, sure there is a Communist party, but their track record on human rights is very fascist) is why China owns us. China owns so much US debt because the politicians in the US constantly mismanage the county, not because economically they are so good. Large parts of the country are still very backward, but they are catching up. However, they had to use a market based pricing of capital goods, because socialism doesn't allow rational pricing which is why it fails. They have also artificially debased their currency which allows them to undercut everyone if they played by the same rules as everyone else I'm fairly certain there wouldn't be a huge trade gap between China and the US.

If you think China is so superior perhaps the US should be more like them. Lets get rid of Social Security, because the Chinese do not have that. Lets also get rid of this ridiculous talk about global warming, because the Chinese don't care and in fact want to even build a huge amount of coal power plants since that's what they are sitting on, huge amounts of coal. Obama shouldn't sign that health care bill either because they aren't getting health care from their government. The US should dump minimum wage laws and end trade unions too.

[XxsourdieselxX]

you ppl have to much interest in that sht, its a part of life u shoouldnt worry about cause there all liars n corrupt u want to have a better country form a group and overthrow the government, we dont have it bad, u could be living like slum dog, any one can grab some tools and start making good money with a lil common sense, if your worried aout the ecomony, buy a house for ten thousand, put 15 in it, rent it, take a loan on it do it again, u can get houses cheap right now, the gov will help u instead of *****ing take advantage, im buyin my first house next month. my old boss rents his cribs for 1000-2000 a month in south side to college kids, ull make your money back in 3 years, cake....

[Nevada_Ballin]

I don't think socialism (I don't believe China is even socialist, sure there is a Communist party, but their track record on human rights is very fascist) is why China owns us. China owns so much US debt because the politicians in the US constantly mismanage the county, not because economically they are so good. Large parts of the country are still very backward, but they are catching up. However, they had to use a market based pricing of capital goods, because socialism doesn't allow rational pricing which is why it fails. They have also artificially debased their currency which allows them to undercut everyone if they played by the same rules as everyone else I'm fairly certain there wouldn't be a huge trade gap between China and the US.

If you think China is so superior perhaps the US should be more like them. Lets get rid of Social Security, because the Chinese do not have that. Lets also get rid of this ridiculous talk about global warming, because the Chinese don't care and in fact want to even build a huge amount of coal power plants since that's what they are sitting on, huge amounts of coal. Obama shouldn't sign that health care bill either because they aren't getting health care from their government. The US should dump minimum wage laws and end trade unions too.

Trade unions ........ some people believe they have artificially raised the level of pay and have handcuffed employers over the years, thus causing a domino effect throughout the country's economics throughout the years.

Regardless if China is socialist, facist or communist or whatever, one thing stands out - they are becoming a strong capitalist force. We can talk down to them all we want about democracy, human rights, minimum wage, the whole "be more like us" stuff, etc but from their standpoint, why should they? Ever since they started allowing private business ownership, they've been booming. "Be like the USA? Why? That great 'capitalist democracy' owes us billions and can't seem to buy their way out of a paper bag - no thanks, we're doing fine as is. Keep on buying our stuff and we'll keep on giving you bail out money!"

It's a tough circle to break at this point. Financially sleeping with the enemy can be disasterous.

.

[BigD]

Trade unions ........ some people believe they have artificially raised the level of pay and have handcuffed employers over the years, thus causing a domino effect throughout the country's economics throughout the years..

I do not see how someone can argue that trade unions haven't driven up pay. There were people working the assembly line in the GM plants making 80k per year! That just isn't reasonable if you want to run a profitable company. I know some people would say that more pay is a good thing but there is a point where it starts to hurt the company and thus when the company goes knocking at uncle sam's door for a handout they lose their job.

[TheRealist]

you ppl have to much interest in that sht, its a part of life u shoouldnt worry about cause there all liars n corrupt u want to have a better country form a group and overthrow the government, we dont have it bad, u could be living like slum dog, any one can grab some tools and start making good money with a lil common sense, if your worried aout the ecomony, buy a house for ten thousand, put 15 in it, rent it, take a loan on it do it again, u can get houses cheap right now, the gov will help u instead of *****ing take advantage, im buyin my first house next month. my old boss rents his cribs for 1000-2000 a month in south side to college kids, ull make your money back in 3 years, cake....

You're obviously NOT worried enough about this because your so called "solution" was how so many people got burned in the past few years.

Even if you buy for 10k and fix it up with only 35k in total cost to you there is no guarantee that the market price of the house will ever get you more than 35k. You've fallen into the trap of believing that prices MUST rise. Tell that to someone flipping homes in 2006 and are now living on food stamps (Good story in the Times about that on Sunday). You're also not considering other costs on your investment (prop. tax., household repairs, etc.) or that the market will price you out if you're not offering your property at a competitively low price compared with other renters.

I mean those sound like some pretty important things to me, but if you think that knowing the info above is having "to much of an interest in this isht" then I don't even know how to respond to that.

To Rico:

Giving chances to systems based on what?

I argue we employ the system that gives people the most individual freedom. Since capitalism is the only system that promotes individual freedom intrinsically, then I think it's a no brainer on which system we should employ.

And as I said, look at some of the economic policies of China's last two dictators and you will see that some of them are anything but Communist. Instead, they have given people/corporations a right to private property ownership (yet there is always the threat of it being taken back) and look what has happened (growth galore). Again, when was private property ownership EVER a tenet of communism? It's not...it's capitalistic in nature. Just like when has the nationalization of a company (GM, Citi...large govt. ownership interests) EVER been a tenet of capitalism?

There is a huge misunderstanding of what these systems inherently stand for. I could careless what they are called just as long as we employ a system that gives people the most overall freedom whether it be economic, political, etc.

[theanalogkid]

Trade unions ........ some people believe they have artificially raised the level of pay and have handcuffed employers over the years, thus causing a domino effect throughout the country's economics throughout the years.

Regardless if China is socialist, facist or communist or whatever, one thing stands out - they are becoming a strong capitalist force. We can talk down to them all we want about democracy, human rights, minimum wage, the whole "be more like us" stuff, etc but from their standpoint, why should they? Ever since they started allowing private business ownership, they've been booming. "Be like the USA? Why? That great 'capitalist democracy' owes us billions and can't seem to buy their way out of a paper bag - no thanks, we're doing fine as is. Keep on buying our stuff and we'll keep on giving you bail out money!"

It's a tough circle to break at this point. Financially sleeping with the enemy can be disasterous.

.

I'm not disagreeing with you here. Rico said how China's been owning us economically, so if that's the case we should be more like them. Just have a complete disregard for environmental standards and human rights issues. It's a lot cheaper to be productive when you don't have to worry about cap and trade and the like, and not have to pay people above market wages to do menial tasks.

His answer for paying for this health care legislation is to tax people. That just removes private capital and makes it even more expensive to do business in the US.

Lets not forget he also said Socialism isn't bad in other post. So we should also have government price controls on everything and create shortages across the board like what happened in the Soviet Union when there were huge lines for bread.

[RicoVacilon]

Since capitalism is the only system that promotes individual freedom intrinsically

See, I think that is patently false. Capitalism does NOT promote individual freedom. It promotes freedom among people who already have money.

There is a huge misunderstanding of what these systems inherently stand for. I could careless what they are called just as long as we employ a system that gives people the most overall freedom whether it be economic, political, etc.

So you want anarchy then.

[RicoVacilon]

Rico said how China's been owning us economically, so if that's the case we should be more like them.

lol

That's not what I said. That's a pretty dip***** move on your part if you're going to try to pull that one off.

[TheRealist]

See, I think that is patently false. Capitalism does NOT promote individual freedom. It promotes freedom among people who already have money.



So you want anarchy then.

As much freedom as can be provided without infringing on others peoples choices...to be more clear...;)

Which is why I say no way to anarchy, freedom and (subsequently) choice cannot be guaranteed when a breach in natural law is unenforceable. Therefore, I would argue that an institution of government is a necessary, not sufficient, condition for establishing more unadulterated choice and a greater degree of individual freedom.

Government along these lines has a role as a facilitator to enforce rule of law. (Mainly contract, civil/criminal, etc.)

I'll answer the first part, but can you give me a system that does promote individual freedom (if not capitalism)?

[RicoVacilon]

I'll answer the first part, but can you give me a system that does promote individual freedom (if not capitalism)?

Well I'm not convinved that "freedom" and economic model are necessarily synonymous. I also don't believe in a "freedome at all costs" mentality. I'm not implying you or anyone else does. But I don't see what the big deal is about some multi-millionaire having the "freedom" to do some of the stuff they get away with when we have people starving in our own country.

Granted, it is a very deep well and the options when discussing it seem to be either 1) treat it in such a general way that it's almost superficial or 2) get so in depth with it that an internet forum ceases to be a conducive medium for discussion.

[conviction]

Rico, we can not strictly adhere to models. Our system needs to just deal with the raw data and make the best decisions. IMO that would mean moving to a market which would allow free competition. Our current system supports corporate structure, if they fall we're there to pick them up. That is not a free market, it is a rigged market.

[RicoVacilon]

Rico, we can not strictly adhere to models.

Like I mentioned to TAK, if you don't know about ideal types, go read the wiki.

[conviction]

What do you want me to draw from ideal type? To me it just sounds like a bunch of pretentious bull****

[RicoVacilon]

Models are only bumps in the path to real logical progression.

1) wtf does that mean?
2) Max Weber was a helluvalot better analyst than you will ever be

[conviction]

1) wtf does that mean?
2) Max Weber was a helluvalot better analyst than you will ever be

It means that models betray. Operating models do not account for variability and hardly do models allow for expansion of reality and can hinder true developing nature of our systems which are ever-changing.

[theanalogkid]

Problem is the system isn't remotely close to the ideal and like I've said before, it's closer to corporatism rather than capitalism.

[Gtrght77]

Problem is the system isn't remotely close to the ideal and like I've said before, it's closer to corporatism rather than capitalism.

It's called a "Mixed Economy".

[RicoVacilon]

It means that models betray. Operating models do not account for variability and hardly do models allow for expansion of reality and can hinder true developing nature of our systems which are ever-changing.

OK, you're theory has its origins about 2500 years ago. And it was shot down about 2499 years ago. It was finally put to rest in the 19th century. You need to get a bit caught up with the times man. Economics were not created by Ron Paul ex nihilo.

[theanalogkid]

It's called a "Mixed Economy".

Mixed Economies have certain sectors nationalized. Corporatism has corporations wielding most of the power in government. That's why the government runs to bail them out when problems happen and rewrite contracts rather than enforce them when corporations come running to Washington.

[conviction]

OK, you're theory has its origins about 2500 years ago. And it was shot down about 2499 years ago. It was finally put to rest in the 19th century. You need to get a bit caught up with the times man. Economics were not created by Ron Paul ex nihilo.

2500 years and we still can't get it right!?!? Go figure :D

[RicoVacilon]

2500 years and we still can't get it right!?!?

2500 years and YOU still can't get it right. The rest of us admit have embraced abstract thought.

[conviction]

2500 years and YOU still can't get it right. The rest of us admit have embraced abstract thought.

Okay okay, models are okay BUT (notice the caps for emphasis) but models can become obsolete and models should be critically evaluated constantly. To evaluate models calls for raw data and understanding, which is what I promote.

[RicoVacilon]

Okay okay, models are okay BUT (notice the caps for emphasis) but models can become obsolete and models should be critically evaluated constantly. To evaluate models calls for raw data and understanding, which is what I promote.

You aren't opposed to Weber and ideal types then. Weber was a mofo. You should check him out if you haven't. He's a hard read because it's all in 19th century german translated into English, but there's good stuff in there.