patrick.net

tatupu70 says

mell says

It would have taken the debt away instantly through defaults, individual defaults followed by corporate defaults, instead of bailouts. For the individuals, it would have destroyed their credit bur relieved them form their debt (and possibly house) instantly. Defaulting banks would not have been an issue for small and medium investors as fdic insurance covers up to 250K per account (if you have more than that you need to have multiple accounts at different institutions and/or hoard some precious metals)

I think you're forgetting that every debt has a lender as well. When you wipe out the debt, you wipe out the savings of someone else. Every bank has owner(s) and the large ones are all publicly owned. You're talking about wiping out the retirement funds of a lot of people. I fail to see how that solves anything. And how that would make the recession any shorter.

Yes, wiping out some retirement funds will be part of the harsh reality. But it will force people to diversify. not to blindly trust banks/corporations/governments, and realize that "guaranteed" 8% pension returns don't exist and shouldn't exist and that hey have been stealing from their own children and continue to do so. The lesson learned here is, don't invest in criminal enterprises and don't trust any government on "guaranteed" returns, use solid hedges for inflation/deflation and diversify your assets, don't heloc your homes, save in regular savings accounts which are fdic insured (backed by money printing aka credit injection if need be) and don't just give your money to somebody who tells you they can manage it better than you could. Stop buying useless tech gadgets and designer clothes, stop buying christmas presents because society tells you so, focus on good nutrition and your and your families health, bring up your kids without materialism/consumerism, teach em the right values. Bailouts is teaching them the wrong values and putting all that debt on their shoulder without them having any say in it. Lastly, arrest the banksters and claw back bonuses and salaries as much as possible - apply the rule of law!

mell says

Yes, wiping out some retirement funds will be part of the harsh reality

Again--so your moralizing aside, how does wiping out people's savings make a recession shorter? Or signficantly reducing demand make a recession shorter?

I understand you don't like debt. Fine. But don't pretend that it would make a recession shorter.

tatupu70 says

mell says

Yes, wiping out some retirement funds will be part of the harsh reality

Again--so your moralizing aside, how does wiping out people's savings make a recession shorter? Or signficantly reducing demand make a recession shorter?

I understand you don't like debt. Fine. But don't pretend that it would make a recession shorter.

It makes it harder but much shorter and it restores the values and principles needed to avoid future recessions/depressions by incentivising prudent risk-management and de-incentivising greed/fraud/financial crime. Also it puts the responsibility on the people who caused this instead of the ones who didn't or haven't been born yet.

mell says

It makes it harder but much shorter

That was then, this is now.

Yes, Obama could have let the economy crash, and that may have been a good thing, except for how fragile Europe was.

I think Obama made all the right moves at the right time, including today.

David Losh says

Yes, Obama could have let the economy crash, and that may have been a good thing, except for how fragile Europe was.

Was Europe fragile? Or was the European Union fragile?

I think that letting things crash had a high risk of leading to a depression. There was a lot of talk of this. Bernanke wrote a thesis on how loose monetary policy could have prevented the depression. Bernanke did what he could.

Obama campaigned in 2008 on the idea that taxes should remain low (Bush levels) on everybody except those making > $250,000. http://money.cnn.com/2008/06/27/news/economy/obama_wealthy_taxes/index.htm
He campaigned in 2012 on basically the same line. He won two elections on the same campaign idea in 2008 and 2012. Let's get on with it.

In 2008, I never thought that Obama would be reelected. I was sure that the stock market and economy were going to go into the crapper way more than they did & way more than would allow O to get reelected.

mell says

It makes it harder but much shorter

You've said this many times, but saying it doesn't make it so. I'm wondering how making a recession into a depression makes it shorter? How does making more people unemployed shorten the duration?

And there seems to be others who agree with you. So anyone--how does making a recession "harder" shorten the duration?

RentingForHalfTheCost says

Our economy shouldn't be so dependant on growth. Growth should be a blessing.

An economy built on growth makes me very nervous. I remember a video that was floating around about the destruction of resources on the planet. It was basically saying that we have allowed corporations and advertisers to fuel a growth based economy by glorifying self-ish, hyper-consumption. This has resulted in a criminal destruction of resources on the planet. We fuel the growth and the concentration of wealth by literally destroying the things that keep us alive.

Bellingham Bill says

That's bullshit framing.

The problem is the corporate press has controlled the debate in this country since the 1980s.

I think greed and entitlement fueled by a corporate press are like a virus.

When I say entitlement, I don't mean benefits to the poor. I mean entitlement to have and consume more. The "Baby, I deserve it!" culture is a toxin.

YesYNot says

He campaigned in 2012 on basically the same line. He won two elections on the same campaign idea in 2008 and 2012. Let's get on with it.

there are always a lot of "obstacles" in congress, all they do is hinder progress.

Mark D says

there are always a lot of "obstacles" in congress, all they do is hinder progress.

True, but I am surprised the repubs are not getting the message. They lost two elections where the economy was one of the biggest issues. The other guy won both with the same message. You would think that the repubs would see the writing on the wall, and go with the flow.

YesYNot says

Mark D says

there are always a lot of "obstacles" in congress, all they do is hinder progress.

True, but I am surprised the repubs are not getting the message. They lost two elections where the economy was one of the biggest issues. The other guy won both with the same message. You would think that the repubs would see the writing on the wall, and go with the flow.

there are also a lot of lobbyists and dark forces working behind the scene.