What happened to all of the doom and gloom economic threads?

[koalabear]

Did you ever think Obama was going to be this bad?

I live near Chicago, yes.

 

[Luk]

I just picked up a $51 million dollar construction job today

 

[Wok]

What exactly did the stimulus, stimulate? Hint, it wasnt consumer spending....

Not enough, and it was not increased consumer spending, right. Learn to read a little closer; once the Fed rates go up, all of that "growth" will disappear.

 

[IrezumiKiss]

“The news today from CBO is clear: The president’s budget will continue to lead our nation into a fiscal catastrophe -- an ever worse one than the president’s own numbers suggest,”

hmmm... revisited and re-stressed...

Baer also said, “What is certain is that the irresponsibility of the past put the country on an unsustainable fiscal trajectory.”

 

[firespin]

hmmmm...

Baer also said, “What is certain is that the irresponsibility of the past put the country on an unsustainable fiscal trajectory.”

hmmm... revisited and re-stressed...

Baer also said, “What is certain is that the irresponsibility of the past put the country on an unsustainable fiscal trajectory.”

You realize you're quoting Obama's spokesman here, right? "Blame Bush."

Or maybe he means Pelosi and Reid's congress for the past three years?

 

[JohnnySavage]

You realize you're quoting Obama's spokesman here, right? "Blame Bush."

Or maybe he means Pelosi and Reid's congress for the past three years?

Maybe he meant it was irresponsible fore Obama, Clinton and Biden to vote "yea" on the 08 and 09 budgets

 

[IrezumiKiss]

You realize you're quoting Obama's spokesman here, right? "Blame Bush."

Or maybe he means Pelosi and Reid's congress for the past three years?

Obama's spokesman? Can't be! He just dissed Obama big time in this report! Plus, I thought the CBO was a nonpartisan agency! Why it even says so right there in the second paragraph of this linked article we're all currently trying to contextually exploit for our eternally useless Liberal Vs. Conservative/Democrat Vs. Republican blame-game-swagger-jacking-last-person-to-post-gets-the-win snowball fight!

 

[Wok]

Obama's spokesman? Can't be! He just dissed Obama big time in this report! Plus, I thought the CBO was a nonpartisan agency! Why it even says so right there in the second paragraph of this linked article we're all currently trying to contextually exploit for our eternally useless Liberal Vs. Conservative/Democrat Vs. Republican blame-game-swagger-jacking-last-person-to-post-gets-the-win snowball fight!

If it does not go your way, call it a Democrat conspiracy.

 

[firespin]

Obama's spokesman? Can't be! He just dissed Obama big time in this report! Plus, I thought the CBO was a nonpartisan agency! Why it even says so right there in the second paragraph of this linked article we're all currently trying to contextually exploit for our eternally useless Liberal Vs. Conservative/Democrat Vs. Republican blame-game-swagger-jacking-last-person-to-post-gets-the-win snowball fight!

You're thinking of the CBO.

This guy is "White House Office of Management and Budget spokesman Kenneth Baer "

which was in the text you edited around.

White House = Executive branch.

But nice try.

 

[Frisco_Slug_Esq]

I see some more banks failed...

I see Obama's budget booming out of control.

I see Obama demanding even larger deficits and I see Greece burning.



I thank the Democrat Party for proving my pre-election predictions on the transparency, ethicality, and fiscal responsibly that accompanies Progressive (Marxist, Socialist, Democratic-Socialist, and Altruistic busybodies) Democrat governance. I also like the way they assume responsibility if they think things are going good and devolve themselves of blame when their secretive, corrupt, and irresponsible spending blows up in their face.

The only real question is, are they really happy-go-lucky boobs who just mean well but don't quite fully understand economics or are they actually sinking us on purpose to level the playing field both internationally and domestically?

At any rate, it looks like we may be headed into a double-dip recession and another lost decade similar to the Progressive '30s of the last century.
__________________
Oliver Wendell Holmes said, "Think things, not words." In words, many see a need for "social justice" to override "the dictates of the market." In reality, what is called "the market" consists of human beings making their own choices at their own cost. What is called "social justice" is government imposition of the notions of third parties, who pay no price for being wrong.
Thomas Sowell

 

[Ulaven_Demorte]

I see some more banks failed...

I see Obama's budget booming out of control.

I see Obama demanding even larger deficits and I see Greece burning.



I thank the Democrat Party for proving my pre-election predictions on the transparency, ethicality, and fiscal responsibly that accompanies Progressive (Marxist, Socialist, Democratic-Socialist, and Altruistic busybodies) Democrat governance. I also like the way they assume responsibility if they think things are going good and devolve themselves of blame when their secretive, corrupt, and irresponsible spending blows up in their face.

The only real question is, are they really happy-go-lucky boobs who just mean well but don't quite fully understand economics or are they actually sinking us on purpose to level the playing field both internationally and domestically?

At any rate, it looks like we may be headed into a double-dip recession and another lost decade similar to the Progressive '30s of the last century.

Just keep hoping against hope for economic failure Cap'n.

Meanwhile, in the Real World™..
Consumer credit rises for first time in a year.
Nasdaq at 18-month high.
Your paycheck is getting bigger. No joke.
An economic snow job.

Oh, and those "even larger deficits" you seem to be concerned with are because the administration includes extending the 2001 and 2003 tax cuts and proposals to protect middle and upper-middle income families from being impacted by the AMT.

B-b-b-b-but... Democrats only increase taxes, right?

 

[Frisco_Slug_Esq]

I don't HAVE to hope for economic failure.

We're IN it.




And with every little day-to-day upswing, you're focused like a laser on the good news which causes people to say stupid things like, today's a good day, we only lost 36,000 jobs...

But as Musashi would say, keep a distanced view of near things and a near view of distanced things like, Just exactly HOW are we going to pay off the interest on our Chinese loans that have brought you these small, daily victory celebrations?
__________________
"A great civilization is not conquered from without until it has destroyed itself within."
Will Durant

 

[Beco]

Just keep hoping against hope for economic failure Cap'n.

Meanwhile, in the Real World™..
Consumer credit rises for first time in a year.
Nasdaq at 18-month high.
Your paycheck is getting bigger. No joke.
An economic snow job.

Oh, and those "even larger deficits" you seem to be concerned with are because the administration includes extending the 2001 and 2003 tax cuts and proposals to protect middle and upper-middle income families from being impacted by the AMT.

B-b-b-b-but... Democrats only increase taxes, right?

The recession is over, we get that. The economy is growing at 6%, but nobody is hiring! Why is that?

 

[Frisco_Slug_Esq]

The recession is over, we get that. The economy is growing at 6%, but nobody is hiring! Why is that?

Don't blame the uncertainty over health care or Cap'n Trade!





Those will make us RICH!!!

 

[RobDownSouth]

Oh, and those "even larger deficits" you seem to be concerned with are because the administration includes extending the 2001 and 2003 tax cuts and proposals to protect middle and upper-middle income families from being impacted by the AMT.

B-b-b-b-but... Democrats only increase taxes, right?

But wait! Didn't the conservitards here SWEAR that Obama was going to RAISE taxes on everyone?

 

[firespin]

B-b-b-b-but... Democrats only increase taxes, right?

But wait! Didn't the conservitards here SWEAR that Obama was going to RAISE taxes on everyone?

Watch for a "deficit reduction commission" coming to a smoke filled room near you. Sounds so much better than "tax increase commission." Like "climate change", or "Community Organizations International."

 

[Frisco_Slug_Esq]

No, we said he was a Marxist and we pointed out in his own words and writings that he was going to destroy capitalism and replace it with equality and with his election we saw business run for the hills.

He has created a hostile business environment for those who are not paying lip service and protection money and if he gets his precious health care, costs WILL go up for everybody who doesn't have a hand out.

Additionally, he hasn't given up on Cap'n Trade, a further anchor to business, and now he's making amnesty noises that will expand the numbers of hands out and entitled citizens.

So, Obama is free to give all the tax cuts he wants as long as he can convince China to keep servicing our rapidly-expanding debt and rapidly-expanding public sector.

 

[Ulaven_Demorte]

The recession is over, we get that. The economy is growing at 6%, but nobody is hiring! Why is that?

I see you're still having problems recognizing that job creation is a lagging indicator of economic health.

 

[Frisco_Slug_Esq]

I see you're still having problems recognizing that job creation is a lagging indicator of economic health.

And under FDR and Japan's Keynesian policies, it lagged for ten fucking years...

 

[Ulaven_Demorte]

And under FDR and Japan's Keynesian policies, it lagged for ten fucking years...

Demonstrating your lack of economic prowess in two threads today huh?

As far as Japan's "Lost decade" goes.. you neglect to mention the cause, only the recovery time and choose to blame the recovery instead of the asset bubble in Japan which actually caused the problem to begin with (which looks remarkably like the precursor to our own economic meltdown. Speculation, Banks and Securities giving away credit, and hyper-inflated real estate values)..

Here's a concise description for you..

In the late 1980s, abnormalities within the Japanese economic system had fuelled a massive wave of speculation by Japanese companies, banks and securities companies. Briefly, a combination of incredibly high land values and incredibly low interest rates led to a position in which credit was both easily available and extremely cheap. This led to massive borrowing, the proceeds of which were invested mostly in domestic and foreign stocks and securities.

Recognizing that this bubble was unsustainable (resting, as it did, on unrealizable land values - the loans were ultimately secured on land holdings), the Finance Ministry sharply raised interest rates. This popped the bubble in spectacular fashion, leading to a massive crash in the stock market. It also led to a debt crisis; a large proportion of the huge debts that had been run up turned bad, which in turn led to a crisis in the banking sector, with many banks having to be bailed out by the government.

Eventually, many become unsustainable, and a wave of consolidation took place (there are now only four national banks in Japan). Critically for the long-term economic situation, it meant many Japanese firms were lumbered with massive debts, affecting their ability for capital investment. It also meant credit became very difficult to obtain, due to the beleaguered situation of the banks; even now the official interest rate is at 0% and have been for several years, and despite this credit is still difficult to obtain.

Overall, this has led to the phenomenon known as the "lost decade"; economic expansion came to a total halt in Japan during the 1990s. The impact on everyday life has been rather muted, however. Unemployment runs reasonably high, but not at crisis levels (the official figure is a little under 5%, but this is a considerable underestimate - the real level is probably around twice that). This has combined with the traditional Japanese emphasis on frugality and saving (saving money is a cultural habit in Japan) to produce a quite limited impact on the average Japanese family, which continues much as it did in the period of the miracle.

 

[Ulaven_Demorte]

More on Japan's "Lost Decade"..

Richard Koo, chief economist at the Nomura Research Institute, says the Japanese government implemented "one of the most successful economic policies in history."

Koo notes that when the real estate bubble of the 1980s burst, property values plummeted 87 percent from the peak nationwide. Counting the value of real estate and stocks, Japan lost wealth equivalent to three years' worth of gross domestic product. It was "just about the largest loss of wealth in human history in peacetime," Koo says.

Still, Japan wasn't in recession. While growth slowed, GDP never fell below the peak of the bubble. And unemployment never went above 5.5 percent — lower than the current rate in the United States.
[...]
With private borrowing and spending frozen, the Japanese government stepped in, spending on highways, bridges and other infrastructure, and running up big deficits. Where the Japanese government erred, Koo says, was in worrying about those deficits. It cut back prematurely on the stimulus. The economy faltered, and the government had to resume spending.

http://www.npr.org/templates/story/story.php?storyId=101066132

 

[Frisco_Slug_Esq]

Did someone mention "asset bubble?"

 

[Frisco_Slug_Esq]

Now do FDR...

 

[Frisco_Slug_Esq]

Since were in c&p mode:

12/26/09 7:29 AM
American Thinker- Print Article
Page 1 of 3
http://www.americanthinker.com/prin...nker.com/2009/12/the_iron_law_of_bubbles.html
Return to the Article
December 26, 2009
The iron law of bubbles
By Henry Oliner
In A Short History of Financial Euphoria, (1993) J. K. Galbraith takes a brief look at
financial bubbles and draws conclusion about their similarity. The most remarkable of the
early manias was not in stock, but in tulip bulbs. The value of mere tulips bulbs grew to
the modern equivalents of $25,000 to as much as $50,000 in today's value during the Tulip
Mania that swept the Netherlands in the 1630s.
Ninety years later in 1720, The Mississippi Company that was formed by John Law to
speculate on the as yet undiscovered gold resources in the New World collapsed. The
revenues from the discovery of gold were supposed to support notes issued by the Banque
Royale to pay off French government debt, but the stock proceeds ended up going directly
to debt reduction. During this same time period the British created a similar joint stock
enterprise called the South Sea Company to also seek wealth from trade routes to retire
British government debt. Also in 1720 it met the same fate as the other manias.
All of these bubbles came to a ruinous end. Promoters that were hailed as geniuses
became villains. Economies were set back years and confidence in financial institutions
was damaged for decades.
The American adventure had numerous bubbles culminating in the stock crash of 1929.
The crash of 1987, the dotcom bubble of the 1990, and the current mortgage fiasco seem
to beg the question, "In spite of the lessons of history, and the superiority of modern
regulatory agencies (the Fed, FDIC, SEC, etc) why do we keep committing the same
disasters?" (I distinguish bubbles, which are real markets bid up excessively by irrational
demand, from frauds such as Vesco and Bernie Maddoff.)
Galbraith notes some similarities. In the aftermath the government tends to fault the
instruments of speculations rather than the individual psychology. While new laws are
passed to avert the last bubble, the human psychological need to speculate simply seeks a
different avenue to quench its thirst.
12/26/09 7:29 AM
American Thinker- Print Article
Page 2 of 3
http://www.americanthinker.com/prin...nker.com/2009/12/the_iron_law_of_bubbles.html
Almost all of the financial bubbles involved excessive debt to one degree or another.
People forget that debt is a doubled edge sword and the very leverage that led to rapid
growth leads to even steeper declines.
But the most striking common attribute that is the human element. In almost every case
there is this infatuation with wealth as a sign of intelligence. Galbraith noted there is "the
impression that intelligence, one's own and that of others, marches in close step with the
possession of money."
"No one wishes to believe that this is fortuitous or undeserved; all wish to think that it is
the result of their own superior insight or intuition. The very increase in values thus
captured the thoughts and minds of those being rewarded. Speculation buys up in a very
practical way the intelligence of the involved."
Long Term Capital was a major fiasco in the late 1990's. With two Nobel prize winning
economists on the board, the hedge fund made bets on small moves that were heavily
leveraged yielding remarkable gains.... for a while. But when excessive debt meets
excessive intelligence, the inevitable consequences of debt will eventually rule.
Our culture is enamored with talent, but the physical skills of an athlete that are clear and
measureable, do not transfer to the boardroom or the trading floor. There is too much
uncertainty and randomness to either credit or blame talent alone for the result.
As Nassim Taleb noted and named his book, we are Fooled by Randomness. We do not
pay an executive millions of dollars because he has talent; we assume he has talent
because he makes millions of dollars.
But this same infatuation with talent can be attached to more than money; it can be
attached to power. With capitalism struggling to recover from yet another smackdown
bubble we seem inclined to somehow believe that academics in political power will yield
better results. The same uncertainty that plagues the financial markets also plagues the
political environment. The biggest difference is that a financial bubble will be brought
down much more quickly. Bad political solutions become institutionalized and linger for
decades. In many ways the current financial mess was born from political solutions
imposed in response to our previous bubbles.
The market doesn't analyze and hold hearings. It is swift and brutal. In fact the financial
bubbles are the result of the public facing the reality of their previous foolishness and
going cold turkey. The best solution is to let the bubble play out and to clear the rubble.
Our inability to withstand short-term pain tends to lead to longer term, often far more
severe pain. It is as foolish to associate political power with intelligence, as it was foolish
to associate mere wealth with intelligence. I would rather have a growing economy with
12/26/09 7:29 AM
American Thinker- Print Article
Page 3 of 3
http://www.americanthinker.com/prin...nker.com/2009/12/the_iron_law_of_bubbles.html
occasional bubbles than government policies seeking to remove all our financial pain and
slowing our economic engine to a crawl. Many of the more recent examples of bubbles
such as the savings and loan bubble in the late 1980's and the current real estate and
mortgage market bubble were largely fed by a combination of political goals and a
politically accommodating fed. Oversight agencies were often restrained from their duty by
political pressure and lobbyists.
Our political discourse is largely about the balance between the need to smartly regulate a
very efficient but imperfect market, and the desire to merely replace financial power with
political power. It often means the balance between individual rights and the interests of
the collective. While the economic self-interest of capitalism is suspect after the bubble is
burst, we often suffer more from the political self-interest that seeks to correct it. Our
most oppressive laws are often the ones designed to protect us from our own stupidity.
Galbraith said that our collective financial memory seems to be about 20 years. By that
time we forget the lessons of the past and repeat them. That period seems more recently to
be closer to eight years. But while our memory may be short these financial bubbles do
burst and we do recover.
Political bubbles, however, are made of iron, and they are much more difficult to deflate.
Henry Oliner blogs at rebelyid.com.
Page Printed from:
http://www.americanthinker.com/2009/12/the_iron_law_of_bubbles.html at December
26, 2009 - 08:28:54 AM EST

__________________
"The Great Depression, like most other periods of severe unemployment, was produced by government mismanagement rather than by any inherent instability of the private economy."
Milton Friedman

 

[Ulaven_Demorte]

Now do FDR...

Half of your argument (Japan's "Lost Decade") already bit the dust with about 3 minutes of research. Do you really want me to start looking into the finer points of Keynesian economic theory WRT FDR and others who have used it sucessfully to extricate themselves from economic turmoil?