There is a politically incorrect old joke that goes like this:
A Frenchman, an Englishman, and a Russian are all to be put to death 2 days hence.
They are each granted one last request, to be granted tomorrow, the day before their execution.
The Frenchman requests one more night of passion with his mistress.
The Englishman requests one more work through the woods with his dog.
The Russian asks that his neighbor's barn and home be burnt down.
Sound familiar?
Mentatt (at) yah00 (d0t) com
10 comments:
Every time there is a financial mess in this country Uncle Sugar comes to the rescue. Each time taking a little bit more of our liberty.
If we recall the reason the federal reserve exists today is due to just such a crisis. Of course it should be obvious after the great depression and then again todays crisis that it failed to solve the issues.
Bottom line. The Federal Government in many cases is the cause or at least a major contributing factor to these crisis and then they come give us less liberty in order to bail us out of the crisis they halped create.
How about they keep the hell out of it.
The Federal Government, Wall Street and the American people are all responsible for this crisis. We, the American people, are or should be responsible for our own actions. Most Americans live wwwwaaayyy beyond their means. The satisfaction from buying something is so short-lived that they need to buy more and more and more......
credit..debt...accumulates!
Jeffers- so let me get this straight. You are for the badly flawed bailout because it will pump enough liquidity into the system to maintain some maneuver room as the whole ship slowly sinks? Which allows individuals to get their house in better order if they so choose. But the ultimate reality is national default on all of this debt and the USD in the trash bin of history.
Another point- if the USD tanks by 50%, then oil prices in USD go up by 100%? So the oil import bill goes from todays $4-500 billion to closer to $1 Trillion/year. I suppose this also applies to all the other essential imports as well.
And when foreign money no longer wants much to do with USD debt- interest rates demanded will rise
to reflect actual risk which includes US inflationary outlook, prospects for repayment, political risk etc. So the interest on the national debt alone could rise to $1 Trillion+/year.
What a mess.
Dear Anon@6:32 PM
That pretty much covers it.
Dear Anon@10:59am
All of that is true, too. Like you, I am a SERIOUS libertarian, and think that AT SOME POINT the Fed should be abolished, and a more sound money system should take its place. I am not sure that backing money with worthless metal is any better than a fractional reserve system, but it could be debated.
I could not agree more with your "Bottom Line". But right now we could lose all of our freedoms if the system is allowed to collapse. Anarchy is NOT a viable answer.
Dear Anon@ 3:39
YES we are responsible for our own actions, and no, that kind of talk won't get anybody elected.
As for living way beyond our means. I don't care what people do for the most part - who they marry, what they inhale, who they worship, what they say, write, or think, what they spend THEIR money on, etc... I just don't give a sh-t.
I don't want to have to use my money (extorted taxes) to pay for their defaults, however.
Sometimes you have to choose the lesser of two evils.
I’m thinking that while I disagree with you, there will be some serious downside to either choice and only the problems with the path chosen will be seen by the general public, even then only when it becomes manifest.
Thus, for any given politician the politically expedient thing to do is to vote on the losing side of the argument.
As for taking the excessive compensation from former Wall Street execs, as you mentioned in your last post. Wouldn’t the proper response be to nail them for fraud; not because they lost money, but because they took money under false pretenses? If someone asks you to invest in plan X and then takes that money to the craps table it is a felony regardless of the outcome. There is no functional difference between that scenario and cooking the books.
Our whole system is based on trust without it we’re in deep dodo. As an example consider going on a business trip. You land in a city of a million or so walk up to the counter to meet with someone you have never met before and five minutes or so later drive off in a 20K car. I could give you similar examples all day and looking crooks in jail is the maintenance cost for all that. Skimp on it and order breaks down. One needn’t derive a perverse pleasure in punishing them to see the necessity of doing so.
To Dan
I agree with you that the financial 'industry' has been gambling with people's money. But if normal investments offer a 5% return and someone offers you a 20% return, then (a) you'll think about it seriously if it appears legal, and (b) its likely to involve taking money out of someone else's pocket (i.e. a zero-sum game), and (c) it can't last for ever.
In the 1800's in the UK an Insurance Act was passed to separate life insurance from gambling; up to that Act it was permissable to insure anybody's life (with the obvious possibility that you suddenly had an interest in hastening their demise!). Recent events like short selling have obvious similarities.
I think its overdue for a Financial Interests Act which separates legitimate investment in successful companies from speculation.
I'd be interested in other comments about this, and maybe how you think it might be structured.
Boom and bust is what opaque, secretive, unregulated markets are about. Bubbles and collapse.
Overreach and collapse is what happens in unregulated biological systems. The wolf (short sellers)or hunter is what regulates the white tailed deer population. Take the regulator away, you have a bubble in the population and all of a sudden deer are all over the highways and jumping through your windshield.
Games have referees for a reason.
We are just experiencing the results of mindless deregulation and secretiveness.
Bottom line:
The date has arrived and you aren't ready.
None of us are.
Tough shit.
Anon 9:07
Apparently, you have been left in the dark. This has very little to do with regulation. This has a great deal to do with greed and government corruption.
Do your research. Start with the Community Reinvestment Act of 1977 and follow the trail from there.
Some of us are ready.
We may have been lucky to have been "educated" by the 80s oil downturn in Denver which probably could be defined as a mini-depression.
Housing foreclosures everywhere. You could stop in front of a HUD house, call up HUD, and make an immediate offer for 50% of new value. HUD would say "wait a minute" and then say OK to your offer. Closing in 3 weeks.
We bought a nice house for 65k cash, lived there a few years and sold for 2X. Then we used that money to pay cash for a 14 acre farm in the Blue Ridge of VA where we now live. Lots of firewood, water, and whitetail deer in a socially stable area with nice views. Solar panels just arrived. Not a penny of debt.
However, the experience scared the bejesus out of us. For many many years we were scared to buy anything new or put a dime into the stock market. I still drive an 88 Toyota PU which is maintained by myself. Got a reputation among family & friends of being tight with a dollar. But now times are getting MUCH worse and all the thrift skills are exactly what is needed.
On the plus side of the housing breakdown- all those young families who could not afford a home now will be able to compete. This is no small thing.
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