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Old 05-12-2008, 06:01 PM
 
531 posts, read 1,097,042 times
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The constant interest rate cutting has caused alot of inflation and devaluation of the dollar. America is now addicted to low interest rates and we are starting to see the serious ramifications of this now
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Old 05-12-2008, 06:39 PM
 
Location: Ohio
18,288 posts, read 13,427,192 times
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Quote:
Originally Posted by Joe107 View Post
The constant interest rate cutting has caused alot of inflation and devaluation of the dollar. America is now addicted to low interest rates and we are starting to see the serious ramifications of this now
No, it hasn't. The US has one of the lowest (currency) inflation rates of any country. The inflation rate in the UK is twice that of the US.

The value of currencies traded on the world market is entirely dependent on (world) supply and demand.

The US$ had superior value because A) it was the International Reserve Currency and the central banks held US$, effectively hoarding them to artificially reduce the supply which increased the value of the US$; and B) it was the International Trade Currency and countries were forced to buy and sell all commodities (oil, natural gas, coal, gold, silver, metals, ores, minerals, timber, wheat, soy beans, corn, rice and other grains) in US$, effectively creating an artificial demand that increased the value of the US$.

Because the largest quantity of commodities sold in volume and price was oil (and natural gas and coal) the US$ was known as the Petro-Dollar.

Therein lies the need for the US to control the world's oil (and natural gas) supplies to ensure that they continue to be sold in US$.

The US stopped publishing the M3 in March 2006, but prior to that we know there are more than 60 countries that dumped their entire US$ currency reserve holdings. We also know that many other countries have reduced or are still reducing their US$ currency reserve holdings. For example, little tiny Sweden reduced its US$ holdings from 37% to 20% and the result was a 2 point drop in the value of the US$

Russia has dumped 100% of its US$ for Euros and gold, and it no longer sells anything in US$, it's all Euros or Rubles (resulting in the meteoric rise of the Ruble against the US$). China and Vietnam are dumping US$, Japan stiffed the US and is buying oil from Iran in Yen, China will be buying oil in Yuan instead of US$ very soon, and many countries are trading in Euros or basket currencies instead of US$.

Most of that happened after the US invaded Iraq, which was selling its oil in Euros (and the first thing the US did was return oil sales to US$) and caused the US$ to drop against the Euro.

So you can put 3 dancing shrimp in charge of the Federal Reserve, you can raise interest rates to 14% you can even do away with the Federal Reserve, but it won't change the fact that most of the world doesn't want US$ as their reserve currency and doesn't want to trade with US$ and it has to do more with US foreign policy than it does the Federal Reserve.
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Old 05-12-2008, 07:05 PM
 
Location: Ohio
18,288 posts, read 13,427,192 times
Reputation: 14186
Quote:
Originally Posted by John23 View Post
There have been alot of accomplices. Some of it has been stupidity, sure. But I don't know if *everybody* losing their house now was stupid.
You should have 6 months of expenses sitting in passbook savings account or in CDs at your bank. That's just common sense.

Quote:
Originally Posted by John23 View Post
-There's been a severe dumbing down of financial news. It's all the party line. If people were better informed, they could make better decisions.
Real estate attorneys exist for a reason, namely to protect you, not just from a fraudulent conveyance or potential liability, but from lending practices that aren't necessarily above the board.

If you start a business, you consult with an accountant and a business attorney. If you buy a house, you consult with a real estate agent and a real estate attorney. That's just common sense.

Quote:
Originally Posted by John23 View Post
-The big networks have been hijacked by Wall Street and the Whitehouse
In accordance with the wishes of the people. People don't want to be informed, they want to be entertained.

I find it ironic that these people sit around saying, "I wonder how Hitler convinced the German people to cart the Jews off to labor camps?" Hitler didn't have TV.

Quote:
Originally Posted by John23 View Post
There's been little if any real discussion about how to live in the current economy.
Are you suggesting people are hatched, or that everyone is an orphan? No one had parents to explain the financial facts of life? Even if not, they should have been able to figure it out on their own.

Quote:
Originally Posted by John23 View Post
-Little if any objective information about mortgages, mortgage brokers or whats going on behind the scenes. The whitehouse/any oversight committees have completely fumbled the ball.
Why would there be oversight committees? This is not the USSR. Besides, over 75% of all sub-prime loans were made during the Clinton Administration, so Bush cannot be blamed for that.

Quote:
Originally Posted by John23 View Post
-Terrible education/understanding about the FIRE economy in school. People were living in a manufacturing/real goods economy, and basically landed in a FIRE economy, and didn't have a clue what just happened.
The FIRE economy is just a theory.

The bottom line is those people are hedonistic and self-indulgent, completely lacking any self discipline. It isn't the end of the world if you have to save $500/month for 6 months to pay cash for a $3,000 big screen TV, and it's a lot cheaper than paying $3,000 plus $2,865 in interest. That's 5th grade math, not a doctoral dissertation at an Ivy League school. Those are the same people that put no money down on their car and ended up making perpetual car payments for the next 10 to 20 years, and then they can't figure out why they have no money.
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Old 05-12-2008, 09:45 PM
 
531 posts, read 1,097,042 times
Reputation: 138
Quote:
Originally Posted by Mircea View Post
No, it hasn't. The US has one of the lowest (currency) inflation rates of any country. The inflation rate in the UK is twice that of the US.

The value of currencies traded on the world market is entirely dependent on (world) supply and demand.

The US$ had superior value because A) it was the International Reserve Currency and the central banks held US$, effectively hoarding them to artificially reduce the supply which increased the value of the US$; and B) it was the International Trade Currency and countries were forced to buy and sell all commodities (oil, natural gas, coal, gold, silver, metals, ores, minerals, timber, wheat, soy beans, corn, rice and other grains) in US$, effectively creating an artificial demand that increased the value of the US$.

Because the largest quantity of commodities sold in volume and price was oil (and natural gas and coal) the US$ was known as the Petro-Dollar.

Therein lies the need for the US to control the world's oil (and natural gas) supplies to ensure that they continue to be sold in US$.

The US stopped publishing the M3 in March 2006, but prior to that we know there are more than 60 countries that dumped their entire US$ currency reserve holdings. We also know that many other countries have reduced or are still reducing their US$ currency reserve holdings. For example, little tiny Sweden reduced its US$ holdings from 37% to 20% and the result was a 2 point drop in the value of the US$

Russia has dumped 100% of its US$ for Euros and gold, and it no longer sells anything in US$, it's all Euros or Rubles (resulting in the meteoric rise of the Ruble against the US$). China and Vietnam are dumping US$, Japan stiffed the US and is buying oil from Iran in Yen, China will be buying oil in Yuan instead of US$ very soon, and many countries are trading in Euros or basket currencies instead of US$.

Most of that happened after the US invaded Iraq, which was selling its oil in Euros (and the first thing the US did was return oil sales to US$) and caused the US$ to drop against the Euro.

So you can put 3 dancing shrimp in charge of the Federal Reserve, you can raise interest rates to 14% you can even do away with the Federal Reserve, but it won't change the fact that most of the world doesn't want US$ as their reserve currency and doesn't want to trade with US$ and it has to do more with US foreign policy than it does the Federal Reserve.

When FOMC lowers rates, they essential inject cash into the market by buying t-bills. Lowering rates is as inflationary as it gets. It's the closest thing to printing money. The more supply of dollar bills that are out there, the less each one is worth. If other countries raise their interest rates, (reduce their money supply) each unit of their currency is worth more. This is what has been going on most recently.

When your currency is devalued, other currencies become more expensive as do global commodities. A very large part of the run up in oil, has nothing to do with oil at all----it has to do with our dollar not being worth much because the Fed is essentially printing it like it's going out of style.
It's been quite some time since we've been burned by inflation...most people are paronoid about the chance of lower growth that it seems as though the fed has been pressured into making more and more rate cuts (which are doing much more harm than good)
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Old 05-12-2008, 10:09 PM
 
Location: America
6,979 posts, read 15,198,557 times
Reputation: 2059
Quote:
Originally Posted by One Thousand View Post
Sure... this is the internet, like you, I have a dozen degrees. Get real, Armchair.

Here's an article about Greenspan commenting on housing: Greenspan Warns of Housing Bubble

Read his book: The Age of Turbulence. I liked that one too.




It wasn't political.
I have a degree in Economics, do you?

Secondly that joke of a site you gave doesn't even need to be addressed.

Third do real research.
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Old 05-12-2008, 10:38 PM
 
Location: San Diego California
6,797 posts, read 6,161,158 times
Reputation: 5171
No, he lowered interest rates based on the Phillips curve, so that the US could have low unemployment and low inflation,

Lowering interest rates does not lower inflation, it causes inflation.

The nation was in a recession. He had no choice but to cut rates and admitted


Of course he had a choice, the right choice would have been not to interfere and let the economy correct itself. It is when the natural laws of supply and demand are interfered with that capitalism cannot work.
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Old 05-13-2008, 06:47 AM
 
Location: America
6,979 posts, read 15,198,557 times
Reputation: 2059
Quote:
Originally Posted by jimhcom View Post
No, he lowered interest rates based on the Phillips curve, so that the US could have low unemployment and low inflation,

Lowering interest rates does not lower inflation, it causes inflation.

The nation was in a recession. He had no choice but to cut rates and admitted


Of course he had a choice, the right choice would have been not to interfere and let the economy correct itself. It is when the natural laws of supply and demand are interfered with that capitalism cannot work.
shhhhh your making to much sense!
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Old 05-13-2008, 07:34 AM
 
1 posts, read 1,555 times
Reputation: 10
Default billions for the bankers

Try checking out
Billions for Bankers, Debt for the people
The real story of money control over America
by Pastor Sheldon Emry
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Old 09-18-2008, 05:48 PM
 
2 posts, read 3,332 times
Reputation: 15
Default Seriously!!!

Quote:
Originally Posted by Simple Living View Post
I have been telling people for the last year to stop buying "stuff"; to pay off their debt as quickly as possible because bad times are coming and the only way to make it through will be to be debt-free. At least consumer debt-free. Get those credit cards paid off as quickly as possible and cancel all of those monthly subscriptions that nickel and dime you to death... magazines, movie channels, cable, eating out, going to movies, buying coffees and pastries, NetFlix, gym memberships, extra cell phone charges like internet, games, texting, etc., Stop buying video games, DVDs, CDs, books, etc., (Use the library, they're free to use.) At least narrow them down. Cancel cable altogether and just use NetFlix, if giving up television is too hard for you.

Most Americans won't do this because we don't want to go without. We don't want to be deprived and we've fallen for the media and advertising hype: "Make YOUR life better! YOU deserve the best!" We're addicted to stuff, convenience and entertainment. Microwaves aren't fast enough for us now. We're addicted to instant gratification and sacrificing these comforts is "insane" to us.

It's possible to live simply and get your debts paid off, though. I figured I'd rather "suffer" for a short time and be free from debt for the rest of my life. Then, during the hard times, it won't be so hard. I've put my plan into action and, by the end of the year, I'll be debt free and have some savings.

No, that doesn't make me any better than anyone else. I just wish people would take control of their debt and be drastic about it, instead of babying it so they don't have to hurt, suffer or go without.


Oh my gosh....I can not believe what I am hearing from some of you. I live in Middle America.... bringing in what is considered "above average income" I have thre children and struggle every single day of my life!! Not because I don't make enough money to pay my bills, not because I have not tried or put the effort forth, but because if you have just a few blip ups in your life.....Like in my case my husband losing his job A FEW DAYS before he was 100% vested because they were "changing management styles" and by changing that means guys younger and NOT 100% vested...Something like this happens and you go in to survival mode... WE had very little debt, no credit cards and paid everything on time.... When we lost the biggest piece of our income!! WE called our mortgage company , who said "sorry...pay all or nothing". We tried to keep up and fell further and further behind.... When he finally replaced his job with a lower paying job... he decided to go back to school, but since they went off our previous years income we only received partial loans( NOT GRANTS LOANS) and had to fill our "family contribution" part based off our old income.... but we did it...he went to school... We did not want a hand out...we just wanted to better our sittuation. WE did get credit cards and any credit we could to keep up with bills....NOT to "buy" things..... we had to.... it was that or lose everything... we continued to snowball ... he did get a higher paying job, but when you are already behind it is hard to maintain and get caught up.... besides by then your credit is in the toilet....WHICH DAMAGES YOU FOR NEARLY FOREVER.... causing you to rely on higher interest rate loans for housing , cars, etc..... all the while your taxes are going up, and up and up.... Once you are behind that snowball, there is nearly no way to recover...you are marked with a scarlet letter on your credit and it takes YEARS if not decades to recover... We now make better money... we are above average, but one little blip in your life and you are strung out on credit card debt in an effort to take care of yourself instead of relying on the government and your credit is so screwed that it is hard just to get up every day! For those of you wondering what I did during this time... I WAS a stay at home mom before he lost his job because we could afford for me to be at home, but since we had three children I began babysitting other people's children in my home to make ends meet.... there is no way I could have afforded daycare on what I would have made as a salary..... so I babysat other people's children...most of who went to work and paid me to watch their kids on their government waiver because THEY were low income!!! The only thing in this sittuation that keeps you from quiting your job and relying on the government is your pride...pride in being an American.....pride in making it yourself..... Unfortuantely our system smacks you in the face for that effort!!!
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Old 09-18-2008, 09:19 PM
 
516 posts, read 1,694,215 times
Reputation: 270
Quote:
Originally Posted by averagemiddleamerican View Post
Oh my gosh....I can not believe what I am hearing from some of you. I live in Middle America.... bringing in what is considered "above average income" I have thre children and struggle every single day of my life!! Not because I don't make enough money to pay my bills, not because I have not tried or put the effort forth, but because if you have just a few blip ups in your life.....Like in my case my husband losing his job A FEW DAYS before he was 100% vested because they were "changing management styles" and by changing that means guys younger and NOT 100% vested...Something like this happens and you go in to survival mode...
Been there. What matters is how you respond. Yes, it can take years. Do you keep fighting or do you give up and whine?

I'm coming out the other end of that tunnel now. I'm buying a house, the first time it's been realistic since I filed bankruptcy to forestall foreclosure. My credit isn't great, but it's a lot better. And I've finally gotten a good job - after years of trying to make it on way too little. And I'm better off now than I have EVER been in my life.

Which choice do you think I made?
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