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Deflation is painful in the short term due to losses in asset values. Mainly real estate and equities. In the long term it lays the foundation for economic expansion by bringing asset values in line with real earnings. Depressions occur when assets are being purchased with debt instead of earnings. They are an economic reset button that brings values and wages back into balance.
Well, then quite frankly Helicopter Ben is wrong, becuase just looking at house prices here in PA, it's clear we've been living a joke for a long time now.
In a truly free-market economy, prices should go up and down based on demand. Why would the government be so keen on keeping asset prices high? Isn't that going to make the correct far worse eventually?
Don't believe everything you read. I have lived thru both, and anyone who was working and supporting themselves 40 or 50 years ago will tell you it was much easier then.
Okay you are asking me to discount research that uses historical statistics of wages versus housing/food/clothing costs in favor of the anecdotal experience of a poster consistently grinding a gigantic ax of negativity?
If anyone will tell me it was easier then, why does texdav say otherwise in the post right after you? Sorry man, I'm going to have to believe what I read in this case.
Well, then quite frankly Helicopter Ben is wrong, becuase just looking at house prices here in PA, it's clear we've been living a joke for a long time now.
In a truly free-market economy, prices should go up and down based on demand. Why would the government be so keen on keeping asset prices high? Isn't that going to make the correct far worse eventually?
Who is holding almost all the defaulted mortgages? Freddy and Fanny. Who is on the hook for those mortgages? The government.
You have to hand it to them; they have done an amazing job of damage control for the past 2 years allowing them to find hundreds of thousands of purchasers to unload many of these properties on at much smaller losses that they would have realized had the market set their value. It is all a game to transfer toxic assets from the current holders to the public. Yes it will make things worse in the long run as we will have many people who will never regain confidence in real estate and stock markets.
With all due respect to your points of view (when on topic I think they are a good balance here in the forum), as a former journalist I just have to say be careful about getting your news from mainstream media. When I was in J-school some 25 yrs ago, the media in this country were owned (yup, their viewpoints and their "news") by about 12 "families." That number has been going down steadily. I'll try to find out who really owns the media and the news these days. Some say the liberals, others say the conservatives, but I can assure you that news and news spins (how facts are put into contexts that change their meanings, and how stories are juxtaposed to lessen their impact) in the mainstream media have an agenda so subtly hidden that consumers have no idea who's pulling the strings...
I don't discount any source of information. Actually, I subscribe very little "mainstream media". To me they are nothing more than an "idiot" light to draw my attention to a potential issue. Then, I can dig a bit deeper. So, while I agree with your point, you are preaching to the choir. The subtle and not-so-subtle sleight of hand that is used to manipulate the masses does not go unnoticed. While the internet used to be a joke when it came to reliable news, that is no longer the case. The problem going forward will be acquiring all pertinent details, collating and assimilating them to form a well balanced view.
But, I do not think that it is always about media manipulation to fulfill a hidden agenda either. I think much of what the public gets today is exactly what they demand. If people were not drawn to newspapers with cute kittens on the front page, or more to the point, political viewpoints that support their beliefs, the papers would not survive.
Where did you go to journalism school? And why are you no longer a journalist? My 16 year old son is presently the managing editor of a well-respected high school newspaper.
Last edited by shaker281; 10-04-2010 at 03:45 AM..
Seeing as you see no value in my posts and they cause you so much frustration, feel free to place me on your ignore list so you will not have to read them any more. That is what that feature is there for. As you can see from my reps there are many who do agree with what I am saying, and many more who are gaining knowledge from both sides from the discussions.
Frustration? Nah! Sometimes I just enjoy messing with a gloomy Gus. Seriously, "America has not begun to suffer yet"?
Right back at ya, with that "ignore" button. I've never put anyone on ignore yet. Although, I'm sure many have done so with me. It doesn't stop me from messing with them though.
As far as "rep" goes, I prefer to be a lone voice in the wind to someone with whom the masses agree. If I came on here daily posting multiple sky is falling scenarios, I am sure I would develop quite a following too. Not necessarily because I was right, but simply because there are many who relish that point of view. Also, I don't have almost 1800 posts.
I do agree with gaining knowledge from both (all) sides, which makes my point of view as valid as anyone's, I suppose. I just choose to remain a little more non-committal, rather than taking a stand and hanging on for dear life.
Last edited by shaker281; 10-04-2010 at 03:49 AM..
If I came on here daily posting multiple sky is falling scenarios, I am sure I would develop quite a following too. Not necessarily because I was right, but simply because there are many who relish that point of view.
Spot on. From seeing some in here it almost seems like they sit there with a browser open to that doomsday blog hitting "F5" to refresh as fast as they can until a new sky is falling article is posted so they can mirror it in this forum.
Okay you are asking me to discount research that uses historical statistics of wages versus housing/food/clothing costs in favor of the anecdotal experience of a poster consistently grinding a gigantic ax of negativity?
If anyone will tell me it was easier then, why does texdav say otherwise in the post right after you? Sorry man, I'm going to have to believe what I read in this case.
I really could not care less what you believe. If you have not learned the value of experience, continue to embellish whatever knowledge you believe you obtain from books. You might want to ponder the question though as why most men of that era were able to support their families without their wives having to work. Something few men today are able to do. Of course it may have been that in those days men really were men, and did not depend on their wives to be the bread winner.
Where did you go to journalism school? And why are you no longer a journalist? My 16 year old son is presently the managing editor of a well-respected high school newspaper.
U-Mo-J, Columbia - one of the best in investigative reporting, freedom of information center, 1st amendment.
Indiana also great.
Retired from that field.
But not retired from investigative research.
I think when your son gets his college education he will be taught in his coursework (esp graduate) to dig really, really deep for his facts for his papers. Like most kids, he'll likely show up his dad!
As for the comments on this thread, look, you will believe what you want to believe, even when the facts are presented right in front of your nose. Part of it is the perch you're sitting on, part of it is social and family conditioning, and part of it is personal preference.
"The sky is falling" is not how you have to "label" the likelihood that this country as it exists now, integrated with the global economy, is in for some deeply troubling times. Things like the stock market and housing will fluctuate up and down, back and forth, all the while possibly spiraling down (as the price of gas does its little dance up and down by the actual season and by the political season but over the long haul only goes up), the GDP growing and hardly reflecting anymore the real state of the economy (how can it?).
The kind of downward spiral we see is not happening directly to those who are comfortably retired or employed. It is happening outside their sphere of experience, and it is slow and stubborn, fluctuating enough to give promise, but still heading southerly.
Last edited by RiverBird; 10-04-2010 at 04:14 PM..
I disagree. From what I've read the amount of money people spend on the basics of food/housing/clothing is a much smaller portion of their income than in the past.
If that was true then (when we were growing up), it was largely true in a one wage-earner household. Today with both partners working full time and some two jobs, what you say may be true.
The rule of thumb was always housing costs should be no more than 1/3 one person's income. Mortgages once went by this principle. Try that now.
Basic salary $50,000 (for one person)
After taxes $42,000 ?
Housing with mortgage $12,000
Property taxes, house insurance, water & sewer etc $6,000+
(added to $12,000 = $18,000 = almost 43% of net salary (of course much more, on a lesser salary)
$100,000 income (2 people) = almost 20% of net salary. Having an earning partner helps.
How many families are there with single-parent households with kids?
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If I came on here daily posting multiple sky is falling scenarios, I am sure I would develop quite a following too. Not necessarily because I was right, but simply because there are many who relish that point of view. Also, I don't have almost 1800 posts.
