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The problem is if you disagree with what the Fed did many will say, "well they kept us out of a depression and it would have been worse". It all is a hypothetical. We also might have had a better recovery had they not kept interest rates at nothing for 7 years...we will never know.
It is like taking medicine when you are sick. Did the medicine make you better or did you get better on your own ?
We will never know. But most of us who are employable have jobs , many folks are doing well and despite the visions of run away inflation we have none.
So i think they deserve the benefit of the doubt that they are navagating us through as i have no reason to believe it isn't their doing.
Well I think they sucked. There was a very simple solution to punish creditors and borrowers while not punishing people for simple market instability. At the fundamental level nearly all creditors were spared and borrowers were punished across the board.
Where do you get this? I got caught up in the S&L meltdown in 1989/1990. I had bought a condo in 1988. I accelerated payments for a number of years and still had to borrow money against my car to settle up at the closing when I sold it 5 years later. In the Great Recession, hundreds of thousands of employed people were allowed to do short sales. Nobody is chasing them for the money and they see no penalty but a 200 point hit to their credit score for that "settled" blemish that cleans up in a few years. It really pisses me off.
The younger crowd won't remember that as they never had it.
I remember when I worked my first job as a teen at McDonalds in the late 70's.
The only adult there was the manager.
In 2006 my son turned 16 and tried to look for a p/t job.
Took him over a year to find one. Adults are all working there now.
Hard to impossible for a 16 year old to find entry level p/t work.
The youth grew up with throw away consumer goods.
They never knew "quality goods".
So there's really no point trying to tell them that because they never had that.
Mine didn't have any problem. She found job right away at 16. I thought Texas has more jobs than California. 2009 was the worst year for teenagers and everybody but they had it worst.
It is like taking medicine when you are sick. Did the medicine make you better or did you get better on your own ?
Like I said, you knew what you said was false.
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We will never know. But most of us who are employable have jobs , many folks are doing well and despite the visions of run away inflation we have none.
I did not have those visions. I posted that back in 2008 that hyperinflation was screwball. The reason I knew is because I know what causes it, and its not "reserves". Banks don't just print money. If interest rates went to zero and people had 100% equity in housing , stocks etc, inflation would be high. That is because there is lots of equity to pledge as security for banks loans. However with debt saturated assets, little new credit could be secured, or will be secured especially in fearful environments . After all, I subscribe to endogenous money theory. So I wasn't surprised at all.
That above would be high inflation. Hyperinflation is invariably caused by political weakness which result from the inability to tax or enforce credit issuance. So unless you lose a war , have large foreign debts, have break away republics that can issue credit in your currency, and/or massive destruction of the real economy it doesn't happen.
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So i think they deserve the benefit of the doubt that they are navagating us through as i have no reason to believe it isn't their doing.
I don't have doubt. I know what they did, and I know another way that could have solved it and easily.
Do you even know what banks do? They ration credit. The basic idea is to make credit expand with new supply. So repeate, banks restrict credit and allocate it peace-meal. That is desirable in functional economies regulating the supply of goods and services.
When the entire economy is sinking you don't need banks which are designed to restrict credit supply . All you need is an aggregate supply of liquidity. One drop dead easy thing to do would would be instead of handing Treasures to banksters, they could have handed it to the social security administration and cancelled all social security withholding. This would spare more of the real economy while still punishing lenders and real estate speculators which is the source of the dysfunction. Credit flowing to rising marginal utility cannot be resolved with more supply. Its eerily similar to slave equity.
When the entire economy is sinking you don't need banks which are designed to restrict credit supply . All you need is an aggregate supply of liquidity. One drop dead easy thing to do would would be instead of handing Treasures to banksters, they could have handed it to the social security administration and cancelled all social security withholding. This would spare more of the real economy while still punishing lenders and real estate speculators which is the source of the dysfunction. Credit flowing to rising marginal utility cannot be resolved with more supply. Its eerily similar to slave equity.
The country would have gone bankrupt before the money went out the door under your plan.
Mine didn't have any problem. She found job right away at 16. I thought Texas has more jobs than California. 2009 was the worst year for teenagers and everybody but they had it worst.
Woah there, you don't want to upset the "my personal anecdote applies at a macro-econ level" apple cart that so many in this forum like to gallop along with.
If HappyTexan's kid couldn't find a job, then clearly it is impossible for young Americans to find a job and that is proof of the poor state of the US economy.
Where do you get this? I got caught up in the S&L meltdown in 1989/1990. I had bought a condo in 1988. I accelerated payments for a number of years and still had to borrow money against my car to settle up at the closing when I sold it 5 years later. In the Great Recession, hundreds of thousands of employed people were allowed to do short sales. Nobody is chasing them for the money and they see no penalty but a 200 point hit to their credit score for that "settled" blemish that cleans up in a few years. It really pisses me off.
They used to pay tax on the forgiving price difference between short sale and mortgage, iirc, during 2008 and after, they were able to walk away scotch free.
The problem is if you disagree with what the Fed did many will say, "well they kept us out of a depression and it would have been worse". It all is a hypothetical. We also might have had a better recovery had they not kept interest rates at nothing for 7 years...we will never know.
There has never been any real economic recovery since 2008, just massive theft of public money and greatest transfer of wealth to the Rich. The FED fancy name programs (QE1, QE2, QE3, ZIRP) are simply WELFARE FOR THE RICH PROGRAMS. The FED has stolen money from our kids and grandkids and gave it to the RICH by inflating assets and the stock market. Today Americans are forced to apply for Food-Stamps in order to be able to make that inflated monthly rent and have food on the table.
As I mentioned many times here, the real economic growth ended in 2001, everything after that is just a fake growth created thru monetary manipulation, artificially lowering interest rates and creating bubbles.
You see economic growth can be fueled in two ways;
1) inflation of worker salaries
2) by debt.
The first method costs Wall Street, because they have to pay for higher worker salaries.
The second methods costs workers, because their salaries are frozen, but their debt capacity is scaled upward with lower and lower interest rates. We got the second method were Wall Street got richer and American workers got poorer. This was Wall Street's plan. Look how well it worked. Now we are bankrupt.
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