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How does that work again? Employment is falling because demand created by personal consumption expenditures is vanishing, and because demand created by business investment expenditures is vanishing. Now you want demand created by government spending and investment to vanish as well? This is an example of putting out fire with gasoline...
This is put so cleanly and so clearly that even C-D right wingers cannot fail to understand it.
So all that "spliced and diced propaganda" is not true? I know, it's the parts where the idiots were claiming there was nothing wrong. There is always a reason that you don't like the message, sometimes it's the messenger, now it's the way it was edited.
Since they are a producer nation one assumes they produced more with their money. The US is a consumer nation.
Side Note: When you read that the US is a consumer economy, it has nothing to do with what or how much we produce. There are only four components of GDP. Personal consumption expenditures, gross private domestic investment, net exports, and government investment and consumption expenditures. PCE acccounts for about 70% of our GDP. That is a measure of how efficient our economy is. The whole purpose of having an economy at all is to provide things that we can all consume, and in this country, 70% of all that we produce comes back to us in exactly such a form. In China today, PCE accounts for about 45% of GDP. By comparison, that's a crappy rate of return, and the government there is desperately trying to raise it to 50% by 2014, and it isn't about to stop there.
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Originally Posted by HappyTexan
What is our only hope..consume more ?
We would have more employment and a higher standard of living if we did.
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Originally Posted by HappyTexan
That won't work very well since we're so much in debt that consumers can't qualify to take on more debt due to the devalution and loss of equity and jobs.
Even people with modest debt and reliable incomes either can't qualify for credit or don't want to. Instead of spending, people are trying to reduce debt and increase savings. All this does is hand more and more money to people who have no reason or intent to invest it in new economic activity. We are suffering much more today from a savings and retrenchment glut than we are from excess debt and irrational consumerism.
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Originally Posted by HappyTexan
So what is the answer for a "consumer" economy that thrives on debt to get out of debt ?
Free flowing credit. Credit is the life blood of every modern economy. Without it, everything comes to a grinding halt. You can only finance things with highly inefficient cash. That is where we are today. Ultimately, we must see global credit markets restarted and restored to prior speeds and volumes. It doesn't really matter very much how we do that. Whatever works will be fine.
Last edited by saganista; 07-12-2009 at 08:28 PM..
Free flowing credit. Credit is the life blood of every modern economy. Without it, everything comes to a grinding halt. You can only finance things with highly inefficient cash. That is where we are today. Ultimately, we must see global credit markets restarted and restored to prior speeds and volumes. It doesn't really matter very much how we do that. Whatever works will be fine.
Credit is not wealth although it gives the illusion of wealth. Credit is debt which must be paid back.
So all that "spliced and diced propaganda" is not true?
It doesn't mean what it's been carefully and deliberately edited to appear to mean.
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Originally Posted by coastalrap
I know, it's the parts where the idiots were claiming there was nothing wrong.
They were not talking about operational safety and soundness. They were talking about a controversy over whether the GSE's had departed in any way from generally accepted accounting practices in preparing their annual reports. If you read the transcripts you would hear Frank ask Treasury Sec. Snow point blank if the case he was trying to make suggested any sort of operational unsoundness in the GSE's and hear an answer of no, not at all, far from it. That part, of course, isn't in the video. Read further and you will hear Frank note that a sensible bipartisan reform bill dealing with all operational concerns had been drafted a year before but was then scuttled by White House insistence on adding limits to GSE market share. That's not in the video either.
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Originally Posted by coastalrap
There is always a reason that you don't like the message, sometimes it's the messenger, now it's the way it was edited.
Well, don't take my word for it. Read the transcripts. Then decide for yourself whether the videos are brazen propaganda or not.
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Originally Posted by coastalrap
The economy is is getting worse, Barry's cure is a lot more of the same poison that we all were mad at Bush for. A lot of people knew that his scheme was not going to work, I bet even he did, unless he is even more stupid that we think. He lied, said whatever he had to to rob future generations just not to let a good crissis go to waste.
Get a clue. Bush was running up debt when he had no reason. Obama is running up debt when he has no choice. A lot of people don't know the first thing about economics, but babble on about the subject anyway. Try not to be one of those. Either learn more or babble less.
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Originally Posted by coastalrap
But you're not fooled. Right, your got your finger on the pulse of the workings inside the beltway.
Yeah, I work here every day. Well, not today. And not tomorrow actually either. Other plans. Back at it on Tuesday.
Last edited by saganista; 07-12-2009 at 08:37 PM..
Credit is not wealth although it gives the illusion of wealth. Credit is debt which must be paid back.
Dude, it's a wash. It's a payable on one person's books and a receivable on another's. In a situation of widespread instant digital communication and where the rule of law applies, credit makes a promise to pay as good as being paid. That is what makes the once unimagineable efficiency of a modern economy possible. How many small businesses do you know that at least used to make payroll on credit? Why would they do that? Can you explain the logic behind it?
Dude, it's a wash. It's a payable on one person's books and a receivable on another's. In a situation of widespread instant digital communication and where the rule of law applies, credit makes a promise to pay as good as being paid. That is what makes the once unimagineable efficiency of a modern economy possible. How many small businesses do you know that at least used to make payroll on credit? Why would they do that? Can you explain the logic behind it?
When that receivable is in China I'll take a pass.
We have more money leaving the US than coming back. Our government is just covering the interest alone on foreign debt.
So far the receivables seem to be outside the US and that is not going to do us any good.
I don't agree with you, and I don't agree with Biden, except for this...
"It is worse, quite frankly, than everyone thought it was, and it is getting worse every day," Vice President Joe Biden said on CBS' "Face the Nation" Sunday.
That was Sunday, January 25. To put it simply, there was no misreading of the economy. It was apparent that it was in very bad shape and quickly getting worse. Only boneheads missed out on that realization and thought a major stimulus was not called for. The administration sought and achieved the most signficant stimulus package that it could. More would have been better, but that was not feasible. Keep in mind that there were idiots with votes actually walking around at the time who thought the inclusion of family planning funds, NEA grants, and Park Service restoration efforts to be the most signficant aspect of the stimulus package. Nothing but more whiny loserism there. Yet another example in a long line of rightwing failure to recognize the scope of a problem or to offer any serious contribution toward its solution.
We differ because my views are based on fact and yours based on crudely contrived propaganda. All loans are risky in degree. Prime loans carry the risk-price of that class of loans. Subprime loans carry the risk-price of the individual loan. This is how borrower-price and lender-cost are equalized. The loans that Congress encouraged were not to a risk-class, but to a socio-economic class long and unjustly denied service by prime institutions. Those are NOT the loans that failed. The loans that failed were those that Congress (and others) questioned. But Chairman Greenspan insisted that he had the situation covered and President Bush wasn't about to hit on any of his good buddies. You want a "misread"? There was one!
Your imagination has run away with you again. Rep. Frank played no significant role in the emergence of the credit crisis. Neither did CRA or the GSE's. And don't even bother with those absurd "In Their Own Words" YouTube videos. They are sliced and diced pieces of propaganda interspersed with counter-factual editorializing designed to lead you to an incorrect conclusion. You have only made their creators happy by following right along with their little bouncing ball. Good boy! Here is the transcript of the hearing in question in the most often posted video. Read it and learn the degree of your foolishness...
So you compare an administration projection from December 2008 to a private sector projection from June 2009. Can you give me a single reason why I should not burst out laughing?
Well it's nice to see you disagree with something the administration says. But I think it is pretty plain that the administration did misread the economy. Re-read your own posts you defend their lack of accuracy on lack of complete information.
Again I think the angry left really needs to avoid the ad hominem attacks, it makes them look hypersensitive to any cricism. To call people idiots and whiney losers because they believe only stimulus should be included in a stimulus package smacks of desperation as the economy continues to spiral downward.
Again the left is under the impression that they are the keeper of fact and dissenting opinions are propaganda. I have read the transcript of the hearings many times and have found them to be more daming than the so called sliced and diced version you decry. I will not quote the relevent passages lest I be accused of slicing and dicing but I urge everyone to read it.
Mmmm now as for comaparing projections of the administration from 2008 to blue chip projections from 2009, I think you need to re-read post 115. You were making the point that the governemnt projections were in line allbeit a little high. I used the forcast of Blue Chip Econimic to show how far off the administration is with concensus. Talk about slice and dice!
"The Blue Chip Consensus is used as the benchmark comparison for the administration's economic forecast which underpins its budget proposals. The latest Blue Chip numbers continue to suggest that the administration's forecast remains overly optimistic. For this year, the administration forecasts a 1.2% decline in real GDP, versus -2.7% in the Blue Chip Consensus. For 2010, the administration forecasts positive growth of 3.2%, but the Blue Chip expects only +2.0%."
When that receivable is in China I'll take a pass.
What does China have to do with the importnce of credit in running an economy? At that, they hold about 6% of the public debt.
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Originally Posted by HappyTexan
We have more money leaving the US than coming back. Our government is just covering the interest alone on foreign debt.
Except for a brief period under Clinton, that's all we've been doing for decades. To any signficant scale, that's all we've been doing since before the Civil War.
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Originally Posted by HappyTexan
So far the receivables seem to be outside the US and that is not going to do us any good.
About 28% of the public debt is foreign held, but that is still not relevant to the question of credit. Irrational fear of credit is irrational. Odd that people need to be reminded of the fact. Credit runs modern economies. Without it, we will limp along as best we can, but we will not be able to function at anything approaching our potential.
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