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Thread: A question on the economy .....
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November 4th, 2008, 07:51 PM #1
A question on the economy .....
The economy is a major issue in this election , yeah it's going to shit so to
speak , but here is my question , up until just a few months ago we were
having record lows in unemployment nationwide and that was for the last
few years , WTF happened ?
Years of growth can go down the shitter just a few months away from
an election ? Seems a little funny to me .[SIGPIC][/SIGPIC]"
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November 4th, 2008, 08:10 PM #2
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November 4th, 2008, 08:14 PM #3
Re: A question on the economy .....
It all just caught up with us now. Artificial props before now. Consumer confidence, business inventory high, housing market cooled (large employment base).
College students are now entering college and will work after graduation in jobs that haven't even been created yet.Veritas Vos Liberat
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November 4th, 2008, 08:17 PM #4
Re: A question on the economy .....
The curent financial crisis started back under the Carter administration...the housing bubble and the uncertainty about the election have hurt investor confidence...I could go on for hours, but the point is...Bush was not responsible, taxes are not the answer...
How pissed are you gonna be if you die before the Zombie Apocalypse comes? - - IANAL
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November 4th, 2008, 08:49 PM #5Grand Member
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Re: A question on the economy .....
a house of cards stands tall right up to the point it falls...and then it falls all at once.
our economy is not based on anything real anymore. it is based on debt-funded consumer spending. we have, for many, many years, propped up our economy by just continuously pumping more and more worthless paper dollars into it (via debt). basically, we just kept adding cards to the house of cards until eventually we put one too many cards on it and it started to fall.
as it started to fall, the government has broken out a new deck of cards and has started frantically trying to replace the cards that have fallen with new ones.
it's not going to work. it's just going to make the pile of worthless cards bigger and harder to get out from under.
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November 4th, 2008, 08:54 PM #6
Re: A question on the economy .....
Just remember a recession is when your neighbor loses his job. A depression is when you lose your job.
BradAnd if you want to race, name the place and I'll show you where it's at mother f@#$&#!
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November 4th, 2008, 09:01 PM #7
Re: A question on the economy .....
Not exactly. Credit breeds wealth, it isn't exactly fake money. Think about trading on a margin account. You borrow someone ele's money to make more of your own and then pay it back, or you take out a loan to buy a house and then sell it, or you borrow money to start a business. Credit is good and allows the building of wealth in the hands of intelligent people, the problem is that we lent money to the wrong people...in part.How pissed are you gonna be if you die before the Zombie Apocalypse comes? - - IANAL
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November 4th, 2008, 09:20 PM #8Grand Member
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Re: A question on the economy .....
no, actually, exactly.
credit only breeds wealth when the free markets sets the price for credit. that way the market regulates the money supply and dollars maintain their value.
that is not what happened, though.
the fed has kept the price of credit (i.e., interest rates) artificially low--like wayyyy lower than it should have been. this meant there was an oversupply of dollars. as per basic supply and demand, this drives the price (value) of each dollar down. this leads to inflation. this, along with the point you made about lending money to non-credit worthy people (that was/is definitely a big part of the problem), drives the price of houses, oil, etc. up. this creates the illsuion of value where it does not actually exist.
eventually, one of two things (or both) happen. you either end up with hyperinflation or the artificial value bubbles burst. if the bubble bursts, the price of the assets comes back down...which effectively makes dollars worth more again, but now there a bunch of people stuck with assets that are worth much less than the amount they owe on them.
so far, only the latter has happened. but, the fed and government seem to be responding by flooding the economy with even more dollars. this will eventually lead to hyperinflation...which will lead to a depression.
what you posted would be absolutely correct if--BIG IF--the market determined the price of credit and who gets it. the market determined neither...the govenment/fed did. and they did so in a horribly short-sighted and irresponsible way. and that is why our economy is a house of cards.Last edited by LittleRedToyota; November 4th, 2008 at 09:31 PM.
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November 4th, 2008, 10:31 PM #9Banned
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Re: A question on the economy .....
Well let me add my knowledge here as I have been seriously studying the economy for some time.
This mess would have happened, elections or not and what many MANY people don't get is the fact the "mortgage crisis" is just a tiny tip of the problem. What has toppled many of these companies (and many more will soon fail) is one of THE dumbest ideas ever come up with in the financial markets .. namely credit default swap derivatives. These things were a ticking time bomb just waiting to go off, they should have NEVER been legal to begin with. Many MANY smart economists were screaming at the top of their lungs for years saying that one little blip in the economy and they would start falling and when they did the shit was gonna hit the fan.
IF you really take the time to read and learn what has happened you will soon see that we have had several ticking time bombs ready to go off for many MANY years (going back to Clinton's administration) ... the bombs were being 'held off' by some very loose and fast monetary policy by the FED and the treasury but while those polices held off the explosion they also in fact made the explosion worse than it would have been without them.
What is scary is those 'powers that be' are still playing loose with the money .. the REAL bottom hasn't happened yet and their 'throwing money at the problem' is going to make the bottom even worse than it would have been.
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November 4th, 2008, 10:48 PM #10
Re: A question on the economy .....
FDR confiscated gold in early '34. JFK was assasinated for trying to go BACK on the gold standard (yeah, it's one of MANY theories, but as the saying goes - FOLLOW, the money! Gold HURTS big bidness, and HELPS the little man - where have the bailouts gone [big bidness]; who AIN'T gettin' 'em? US. Not the wildest of theories, in an ECONOMIC light...), and Nixon dumped it ENTIRELY in '71. The economy sucked in the 70's, right up to about '83. Cold War spending 'saved us,' deficit spending kept it all afloat through 2007. Now we're at the beginning of the Great(ER) Depression, pt.II - we should start pulling out of it, around 2030, according to most of the economists I read (i.e. - NOT the "money honies" on the cable news networks! They'll make your palms hairy AND bankrupt you at the same time!).
BobLast edited by The_War_Wagon; November 6th, 2008 at 06:02 PM. Reason: Had a wrong date - D'OHH!
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