patrick.net

"Do you see Ron Paul agitating for breaking up TBTF or enacting Glass Steagall 2.0? I don't."

So your saying Paul voted for the repeal of Glass-Steagall?

thomasdt12 says

So your saying Paul voted for the repeal of Glass-Steagall?

No. I said he hasn't proposed a new bill to break up TBTF. Instead he proposes some magic bullshit whereby if we deregulate even further the rainbow-farting unicorn will shower us all with gold and FIRE cartels will cease to exist. He prefers to spend his time on The Hill poking hornets nests with a stick and endlessly proposing bills to outlaw abortion.

Vicente says

Therefore the Panic of 1837 never happened?

Panic is just a panic.

How about the Great Depression? I mean the one in 1873 which was the ORIGINAL Great Depression, since overlaid by "journalists" who recycled the name and obscured it from casual view.

Depression of 1873-1879 with the following recession of 1882-1885 was 12 years long. Though there was a very slow growth till 1996.
The "Great Depression" of 1929-1942 was 13 years long with the New Deal and all Keynessian stimulus. It ended only because of the WW2, not because of the Government interventions. Also, I never told that welfare kind of intervention is unjustified or bad for economy.

The myth that Paulistas operate under, is that the "business cycle" will fix everything if we are abolish government controls entirely and let banks run rampant.

The government has proved without doubt it can't control banks, rather banks control the government. What we've seen is that the government supports and protects banks running rampant. It steals money from the people and transfers it to the banks. Without guaranteed bailouts banks would never even try their reckless runs. Those who would try it would go out of business. (BTW, maybe it's better to avoid calling names and sticking labels like "Paulistas". Without them your arguments would sound much more serious.)

Do you see Ron Paul agitating for breaking up TBTF or enacting Glass Steagall 2.0? I don't. Libertopians would be happy for banking monopolies and trusts to boom again like in the Robber Baron eras.

TBTF is just a myth. Just allow them TF and they will be gone or break up by themselves. "Libertopians ..." -- again label and a bit of libel -- not a serious argument.

And again, the government should make absolutely clear that it will never bailout any financial speculation. Making thsi message unambiguos, clear, and sticking to it will end any TBTF bubbles.

Edited.

Vicente - Panic of 1837 was caused by that day's Federal Reserve - Second Bank of the United States printing money aka causing inflation.

michaelsch says

The "Great Depression" of 1929-1942 was 13 years long with the New Deal and all Keynessian stimulus.

Slight correction - Great Depression was 1929-1947.
WWII didn't end it - only exacerbated it - things were pretty crappy for Americans until War stopped, soldiers returned into productive sector and taxes were slashed.

AlexS says

michaelsch says

The "Great Depression" of 1929-1942 was 13 years long with the New Deal and all Keynessian stimulus.

Slight correction - Great Depression was 1929-1947.

WWII didn't end it - only exacerbated it - things were pretty crappy for Americans until War stopped, soldiers returned into productive sector and taxes were slashed.

Thanks. Well, at least the unemployment ended in 1943.

michaelsch says

Thanks. Well, at least the unemployment ended in 1943.

Yes, unemployment ended - because everyone was on war footing - either dying, or destructing, or making weapons for destruction.

War employment is the worst thing for real economy - where normal purpose of the economy is to enrich people, build, create stuff, war employment produces poverty and destruction for everyone invovled, except of course weapon manufacturers and their government cronies.

So yes, US unemployment went down, but there was a food shortage, and you had quotas for sugar and butter, and had to stand in line. Only idiot government-paid pseudo-economists call it an "economic recovery".

AlexS, you are preaching to the choir about how bad a thing war is.

But the war related production included building ships, tracks, jeeps etc. Those not only for US military but for our allies and also a lot of cargo ships.

Beside this, a major development of the WW2 was British opening of their colonies for free trade (basically for American trade) and eventually the complete collapse of British Empire. As the result, by the end of the war the production in other industrialised nations was all but destroyed, while all markets turned open for America.

So, the WW2 was a horrible thing, but it greatly benefited American economy.

michaelsch says

AlexS, you are preaching to the choir about how bad a thing war is

Hence I said "slight correction" :)

But no, War wasn't good for American economy either. It's like saying that if you bombed your business partners and clients, you become better of. You don't.

Everyone's lifestyle suffered tremendously during WWII, both on the receiving end of bombs (Europeans), but also on the giving end (American capital was squandered on producing destruction).

Metal and rubber and oil went on producing worthless (to the consumer) goods such as tanks and military trucks and bombs. Digging and filling holes is even better for the economy than that - less capital is squandered.

Dan8267 says

FortWayne says

The term "Too big To Fail" is a bullshit term really. No one is too big to fail.

People think that anti-trust laws exist solely to protect users from being charged too much. But there are many other reasons anti-trust laws exist such as

1. They prevent a company from bringing down an entire industry.

2. They prevent a company from causing a depression.

3. They prevent a company from unduly influencing the government to give themselves unjust advantages and to stifle competition and the interests of society at large.

Of course, we have to actually enforce anti-trust laws for them to work, and anti-trust laws were in effect nullified by the Reagan administrations. We need to bring them back. Bring back the ghost of Teddy Roosevelt!

If you look at these 3 things from a military logistics standpoint, then you see how the military-industrial complex works to protect itself, more than to protect citizens.
Distributed logistics.

Dan8267 says

Any bank that is too big too fail is too big to exist and should be broken apart by anti-trust laws.

David Stockman agrees with you:

The greatest regulatory problem — far more urgent that the environmental marginalia Mitt Romney has fumed about — is that the giant Wall Street banks remain dangerous quasi-wards of the state and are inexorably prone to speculative abuse of taxpayer-insured deposits and the Fed’s cheap money. Forget about “too big to fail.” These banks are too big to exist — too big to manage internally and to regulate externally.

Vicente says

Libertopians would be happy for banking monopolies and trusts to boom again like in the Robber Baron eras.

I think they miserably fail to recognize that human nature is prone to entropy and deterioration.