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how American society unravelled


By Patrick   Follow   Sun, 23 Jun 2013, 8:54am PDT   7,120 views   323 comments   Watch (0)   Share   Quote   Permalink   Like (2)   Dislike  

http://www.guardian.co.uk/world/2013/jun/19/decline-fall-american-society-unravelled

Youngstown, Ohio, was once a thriving steel centre. Now, the industry has all gone and the city is full of abandoned homes and businesses. Photograph: Brian Snyder/Reuters In or around 1978, America's character changed.

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iwog   befriend   ignore   Tue, 25 Jun 2013, 2:48pm PDT   Share   Quote   Like   Dislike     Comment 284

indigenous says

And that boys and girls is what the psychologists call projecting, what normal people call don't throw rocks if you live in a glass house

Nope. That makes you feel better, however the reality is very simple. You blame the House of representatives entirely for actions approved by Reagan and passed by the Republican majority in the Senate. It is EVERY BIT as fucking stupid as blaming Republicans in the House TODAY for all the actions of the Obama administration.

This folks is insanity defined. It is total proof that we're dealing with a religious cult and not having an actual conversation.

indigenous   befriend   ignore   Tue, 25 Jun 2013, 2:55pm PDT   Share   Quote   Like   Dislike     Comment 285

iwog says

indigenous says

And that boys and girls is what the psychologists call projecting, what normal people call don't throw rocks if you live in a glass house

Nope. That makes you feel better, however the reality is very simple. You blame the House of representatives entirely for actions approved by Reagan and passed by the Republican majority in the Senate. It is EVERY BIT as fucking stupid as blaming Republicans in the House TODAY for all the actions of the Obama administration.

This folks is insanity defined. It is total proof that we're dealing with a religious cult and not having an actual conversation.

Show me the numbers

Bellingham Bill   befriend   ignore   Tue, 25 Jun 2013, 3:43pm PDT   Share   Quote   Like   Dislike     Comment 286

iwog says

By far the biggest spending program in the 1980s was Star Wars. It was Reagan's baby, not the Democrats.

http://research.stlouisfed.org/fred2/graph/?g=jKA

shows how DOD spending growth (red) overtook fed ex-DOD spending (blue).

Bush-Clinton cut that back but the geniuses running things 2001-2006 had other ideas.

adarmiento   befriend   ignore   Tue, 25 Jun 2013, 7:15pm PDT   Share   Quote   Like   Dislike     Comment 287

iwog says

By far the biggest spending program in the 1980s was Star Wars.

Give us proof that this is true.

indigenous   befriend   ignore   Wed, 26 Jun 2013, 12:33am PDT   Share   Quote   Like   Dislike     Comment 288

iwog says

It is EVERY BIT as fucking stupid as blaming Republicans in the House TODAY for all the actions of the Obama administration.

The house Republicans are starting to do good by slowing the spending. Just like Gingrich did with Clinton (who would have spent too much also). The trouble came from the Pelosi years.

Bellingham Bill says

shows how DOD spending growth (red) overtook fed ex-DOD spending (blue).

Bush-Clinton cut that back but the geniuses running things 2001-2006 had other ideas.

Ok it appears he did increase spending on defense. But to be fair it was following a decrease in spending from Carter and less spending from the Vietnam war.

With Carter are defenses were low, remember how long Iranians had the hostages. The only thing I remember Reagan doing was when they proved Gaddafi was behind the Pan Am bombing, he went after Gaddafi immediately and it was done. Point is that between stopping Vietnam and Carter are defenses were low. There was a cold war going on. I don't know if this is what broke up the USSR but it helped.

marcus   befriend   ignore   Wed, 26 Jun 2013, 12:41am PDT   Share   Quote   Like   Dislike     Comment 289

indigenous says

With Carter are defenses were low, remember how long Iranians had the hostages.

Yes, if our government gifts to the military industrial complex had only been higher, Iran wouldn't have dared to fuck with us. Or maybe we would have known to invest in more special forces.

Special forces were unfortunate (unlucky ?) in their helicopter attempt, which obviously reflected on the commander in chief. More money would have made all the difference.

tatupu70   befriend   ignore   Wed, 26 Jun 2013, 12:43am PDT   Share   Quote   Like   Dislike     Comment 290

indigenous says

The house Republicans are starting to do good by slowing the spending. Just like Gingrich did with Clinton (who would have spent too much also). The trouble came from the Pelosi years.

So how exactly can you tell if it's the President, the Senate, or the House that is doing the spending?

I'm just kidding--I know the answer.

deepcgi   befriend   ignore   Wed, 26 Jun 2013, 12:44am PDT   Share   Quote   Like   Dislike     Comment 291

We are all too calm over the derivatives time bomb. Rising interest rates could absolutely destroy credit as we understand it. No one knows for certain what happens when hundreds of trillions in bets are lost, but it will surely not be solved with action by the Fed.

Reality   befriend   ignore   Wed, 26 Jun 2013, 12:59am PDT   Share   Quote   Like   Dislike     Comment 292

iwog says

So you're taking a future prediction (which will be wrong) and claiming it represents current market action.

Nice work. Could you possibly destroy your own credibility any further?

Someone apparently spent too much time studying a board game to notice what's been happening to stock markets and bond markets around the world. News flash: stock markets and bond markets are much more than the 3 indices that you hear on NPR in a 15-second summary every evening.

While this is not a prediction per se, the emerging markets and bond markets do have a history of being leading indicators.

indigenous   befriend   ignore   Wed, 26 Jun 2013, 1:00am PDT   Share   Quote   Like   Dislike     Comment 293

marcus says

More money would have made all the difference

Defense is a legitimate part of our government. But it is still IMO cronyism with the defense contractors which is no better than the public union you belong to.deepcgi says

We are all too calm over the derivatives time bomb. Rising interest rates could absolutely destroy credit as we understand it. No one knows for certain what happens when hundreds of trillions in bets are lost, but it will surely not be solved with action by the Fed.

My understanding is the whole OTC derivative thing is just something the media uses to sell newspapers. It is not a threat because the traders have to post collateral daily. E.G. Lehman brothers owed a bunch of money because of derivative exposure, the reality though was that the final settlement was maybe 20 million, because they have to post collateral.

Additionally companies use derivatives as insurance so that the actual exposure is low.

What is more likely is that someone in government wants to regulate something that regulates itself already.

thomaswong.1986   befriend   ignore   Wed, 26 Jun 2013, 1:32am PDT   Share   Quote   Like   Dislike     Comment 294

indigenous says

Additionally companies use derivatives as insurance so that the actual exposure is low.

Yes, even the print media uses derivatives to ensure paper costs dont go up.
But even journalists have become disconnected to many aspects how industries and economies work.

thomaswong.1986   befriend   ignore   Wed, 26 Jun 2013, 1:42am PDT   Share   Quote   Like   Dislike     Comment 295

iwog says

How do you know?

And why do you blame Tip O'Neil? By far the biggest spending program in the 1980s was Star Wars. It was Reagan's baby, not the Democrats.

You just love faking up history don't ya.

you might wanna brush up on your history... SDI didnt take off like you have
concluded.

http://en.wikipedia.org/wiki/Strategic_Defense_Initiative

Under the administration of President Bill Clinton in 1993..... (read on)

mdovell   befriend   ignore   Wed, 26 Jun 2013, 1:58am PDT   Share   Quote   Like   Dislike     Comment 296

Eh...

SDI like many programs was thought under one administration and then enacted during another.

Sometimes funding can hold things tightly. For example JFK made the Peace Corp from executive funding. So the next year they pretty much blackmailed congress to fund it otherwise they'd be laying people off and creating bad relations.

Not to praise Carter by any means but what he did and what he looked like were two different things.

He deregulated the airlines
He deregulated the trucking industry (even Reagan was against it)
He deregulated the rail industry.

Stealth bomber came out under him
FEMA started under him.

Carter doctrine stated that the USA would go to war for energy. This was cited by Dick Cheney during the first gulf war!

In addition that soviet invasion of Afghanistan was actually provoked by the USA.
http://williamblum.org/essays/read/how-the-us-provoked-the-soviet-union-into-invading-afghanistan-and-starting

"Indeed, it was July 3, 1979 that President Carter signed the first directive for secret aid to the opponents of the pro-Soviet regime in Kabul. And that very day, I wrote a note to the president in which I explained to him that in my opinion this aid was going to induce a Soviet military intervention."

"Brzezinski: Regret what? That secret operation was an excellent idea. It had the effect of drawing the Russians into the Afghan trap and you want me to regret it? The day that the Soviets officially crossed the border, I wrote to President Carter, in substance: We now have the opportunity of giving to the USSR its Vietnam war. Indeed, for almost 10 years, Moscow had to carry on a war unsupportable by the government, a conflict that brought about the demoralization and finally the breakup of the Soviet empire."

"Question: And neither do you regret having supported the Islamic fundamentalists, having given arms and advice to future terrorists?

Brzezinski: What is most important to the history of the world? The Taliban or the collapse of the Soviet empire? Some stirred-up Moslems or the liberation of Central Europe and the end of the cold war"
To note this was published back in 1998!

Bellingham Bill   befriend   ignore   Wed, 26 Jun 2013, 5:13am PDT   Share   Quote   Like   Dislike     Comment 297

Brzezinski is an evil shitheel

Bellingham Bill   befriend   ignore   Wed, 26 Jun 2013, 5:16am PDT   Share   Quote   Like   Dislike     Comment 298

indigenous says

With Carter are defenses were low

http://research.stlouisfed.org/fred2/graph/?g=jLM

Defense spending increased 25% under Carter.

APOCALYPSEFUCKisShostikovitch   befriend   ignore   Wed, 26 Jun 2013, 5:17am PDT   Share   Quote   Like (1)   Dislike     Comment 299

What's for dinner?

FACE!

Bellingham Bill   befriend   ignore   Wed, 26 Jun 2013, 5:20am PDT   Share   Quote   Like   Dislike     Comment 300

deepcgi says

Rising interest rates could absolutely destroy credit as we understand it.

this is true, actually, and why rates can't rise.

http://research.stlouisfed.org/fred2/graph/?g=jLO

blue is systemic debt leverage (not counting finance sector)

red is prime rate

Bellingham Bill   befriend   ignore   Wed, 26 Jun 2013, 5:24am PDT   Share   Quote   Like   Dislike     Comment 301

indigenous says

Lehman brothers owed a bunch of money because of derivative exposure, the reality though was that the final settlement was maybe 20 million, because they have to post collateral.

their collateral was crap.

http://research.stlouisfed.org/fred2/graph/?g=jLP

shows when housing crashed there was a $6T debt overhang, with hundreds of billions of losses to be distributed (individually) to many, many financial firms.

AIG, C, BAC, LEH, MS, etc etc.

Nobody had the capital to cover these bad bets.

indigenous   befriend   ignore   Wed, 26 Jun 2013, 5:29am PDT   Share   Quote   Like   Dislike     Comment 302

Bellingham Bill says

Nobody had the capital to cover these bad bets.

Are you saying that they did not have to post collateral?

indigenous   befriend   ignore   Wed, 26 Jun 2013, 5:34am PDT   Share   Quote   Like   Dislike     Comment 303

tatupu70 says

indigenous says

Are you saying that they did not have to post collateral?

They all bought insurance against defaults. Except they all bought that insurance from the same company so if that company went bankrupt and couldn't pay, the insurance was worthless. Have you heard of AIG?

You are talking about mortgage default insurance, which is different

iwog   befriend   ignore   Wed, 26 Jun 2013, 5:39am PDT   Share   Quote   Like   Dislike     Comment 304

indigenous says

You are talking about mortgage default insurance, which is different

No he's talking about credit default swaps.

indigenous   befriend   ignore   Wed, 26 Jun 2013, 5:46am PDT   Share   Quote   Like   Dislike     Comment 305

iwog says

indigenous says

You are talking about mortgage default insurance, which is different

No he's talking about credit default swaps.

Tatpu

Was talking about AIG, not credit default swaps

tatupu70   befriend   ignore   Wed, 26 Jun 2013, 5:52am PDT   Share   Quote   Like   Dislike     Comment 306

indigenous says

Tatpu


Was talking about AIG, not credit default swaps

I deleted the comment because I realized that it was a bit off-topic but you must have replied before I did.

AIG is credit default swaps though.

iwog   befriend   ignore   Wed, 26 Jun 2013, 5:53am PDT   Share   Quote   Like   Dislike     Comment 307

indigenous says

Was talking about AIG, not credit default swaps

You're very confused. AIG got taken down because they wrote credit default swaps on bad mortgages. There was no collateral and they were nothing more than casino bets.

http://www.reuters.com/article/2008/09/18/us-how-aig-fell-apart-idUSMAR85972720080918

APOCALYPSEFUCKisShostikovitch   befriend   ignore   Wed, 26 Jun 2013, 5:54am PDT   Share   Quote   Like   Dislike     Comment 308

Yes, without that instrument, the market would never have scaled the way it did.

Bellingham Bill   befriend   ignore   Wed, 26 Jun 2013, 8:07am PDT   Share   Quote   Like   Dislike     Comment 309

Mish was on this a long time ago:

"Unfortunately we can’t start cutting interest rates just yet because we are also frightened by the massive speculation in the financial markets with stock buybacks, mergers, leveraged buyouts, and trillions of dollars in derivatives floating around some of which we do not even know who the ultimate guarantor is. We are hoping but do not know that the ultimate guarantor of these derivatives is not Madame Merriweather's Mud Hut in Malaysia."

http://globaleconomicanalysis.blogspot.com/2006/12/email-from-bernanke.html

indigenous   befriend   ignore   Wed, 26 Jun 2013, 11:27am PDT   Share   Quote   Like   Dislike     Comment 310

iwog says

AIG got taken down because they wrote credit default swaps on bad mortgages. There was no collateral and they were nothing more than casino bets.

My understanding is that they had to post collateral and that they do hedge. One of yous is wrong?

Bellingham Bill   befriend   ignore   Wed, 26 Jun 2013, 12:32pm PDT   Share   Quote   Like   Dislike     Comment 311

indigenous says

My understanding is that they had to post collateral

. . .

AIG DID NOT HAVE THE CASH TO PAY OFF THE BAD SWAPS THEY HAD WRITTEN.

AIG WAS WHAT EVERYONE WAS HEDGING THEMSELVES *WITH*.

AIG WAS MISH'S MUD HUT.

"AIG was one of the largest purveyors of credit default swaps, or CDSs, during the financial crisis. At one point, it had written $79 billion worth of CDSs on pools of mortgage-backed securities, or credit default obligations, according to the FCIC."

http://money.cnn.com/2011/01/27/news/companies/goldman_sachs_fcic/index.htm

According to the regulatory regime of the era, Wall Street were mature individuals and able to regulate themselves.

"The report also cites AIG’s success in setting up its financial products unit in London and selecting a weak U.S. regulator, the Office of Thrift Supervision, as contributing to the firms’ failure.

"Because of the deregulation, state regulators were barred from regulating AIG’s credit default swaps, even though they were similar to insurance contracts. If that deregulation, which began under the Clinton Administration, had not happened, the commission suggests that events might have been different."

http://www.insurancejournal.com/news/national/2011/01/27/182186.htm

"The Commission concludes AIG failed and was rescued by the government primarily because its enormous sales of credit default swaps were made without putting up initial collateral, setting aside capital reserves, or hedging its exposure—a profound failure in corporate governance, particularly its risk management practices.

"AIG’s failure was possible because of the sweeping deregulation of over-the-counter (OTC) derivatives, including credit default swaps, which effectively eliminated federal and state regulation of these products, including capital and margin requirements that would have lessened the likelihood of AIG’s failure. The OTC derivatives market’s lack of transparency and of effective price discovery exacerbated the collateral disputes of AIG and Goldman Sachs and similar disputes between other derivatives counterparties. AIG engaged in regulatory arbitrage by setting up a major business in this unregulated product, locating much of the business in London, and selecting a weak federal regulator, the Office of Thrift Supervision (OTS)."

More about the OTS:

http://articles.washingtonpost.com/2008-11-23/politics/36881444_1_office-of-thrift-supervision-regulators-ots

Blurtman