Think the economic crisis is over? The "most prestigious" financial institution in the world begs to differ, as does it's former Chief Economist

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    Oct 01, 2009 8:33 AM GMT
    The Bank for International Settlements (BIS), in June of 2007, warned of a new Great Depression, saying "that years of loose monetary policy has fuelled a dangerous credit bubble, leaving the global economy more vulnerable to another 1930s-style slump than generally understood."

    "The BIS, the ultimate bank of central bankers, pointed to a confluence a worrying signs, citing mass issuance of new-fangled credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system."
    http://www.telegraph.co.uk/finance/economics/2811081/BIS-warns-of-Great-Depression-dangers-from-credit-spree.html

    NOW: The BIS has warned, in September of 2009:

    "The global market for derivatives rebounded to $426 trillion in the second quarter as risk appetite returned, but the system remains unstable and prone to crises."

    "Stephen Cecchetti, the bank's chief economist, said over-the-counter markets for derivatives are still opaque and pose "major systemic risks" for the financial system. The danger is that regulators will again fail to see that big institutions have taken far more exposure than they can handle in shock conditions."

    Further, "The misjudgement was to think the banks and insurers were safe because their "net" exposure was modest. That proved to be an illusion."
    http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/6184496/Derivatives-still-pose-huge-risk-says-BIS.html

    While the BIS is the "most prestigious" financial institution in the world, it must still couch its language in a careful manner, and itself, represents the financial sector. For a more direct analysis, go to it's former Chief Economist, William White, former economist at the Bank of England, the Bank of Canada, former Deputy Governor of the Bank of Canada, and from 1995-2008, he was Chief Economist and Head of the Monetary and Economic Department at the Bank for International Settlements (BIS).

    As far back as 2003, White warned of the coming financial storm and subprime crisis that set loose in 2007, and was the lone voice in openly criticizing and challenging Alan Greenspan. As Der Spiegel reported:

    "White recognized the brewing disaster. The analysis department at the BIS has a collection of data from every bank around the globe, considered the most impressive in the world. It enabled the economists working in this nerve center of high finance to look on, practically in real time, as a poisonous concoction began to brew in the international financial system."

    "Now White has been proved right -- to an almost apocalyptical degree. And yet gloating is the last thing on his mind. He, the chief economist at the central bank for central banks, predicted the disaster, and yet not even his own clientele was willing to believe him. It was probably the biggest failure of the world's central bankers since the founding of the BIS in 1930. They knew everything and did nothing. Their gigantic machinery of analysis kept spitting out new scenarios of doom, but they might as well have been transmitted directly into space."
    http://www.spiegel.de/international/business/0,1518,635051,00.html

    So what is White saying NOW?

    "The world has not tackled the problems at the heart of the economic downturn and is likely to slip back into recession."

    He also "warned that government actions to help the economy in the short run may be sowing the seeds for future crises." The Financial Times quoted him as saying: "Are we going into a W[-shaped recession]? Almost certainly. Are we going into an L? I would not be in the slightest bit surprised," and added, "The only thing that would really surprise me is a rapid and sustainable recovery from the position we’re in."

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    Oct 01, 2009 8:33 AM GMT
    "Worldwide, central banks have pumped thousands of billions of dollars of new money into the financial system over the past two years in an effort to prevent a depression. Meanwhile, governments have gone to similar extremes, taking on vast sums of debt to prop up industries from banking to car making."

    Further, "These measures may already be inflating a bubble in asset prices, from equities to commodities, he said, and there was a small risk that inflation would get out of control over the medium term."
    http://www.ft.com/cms/s/0/e6dd31f0-a133-11de-a88d-00144feabdc0.html

    The Australian reported in late June of 2009, in reference to the Australian government:

    "fiscal stimulus packages may provide no more than a temporary boost to growth, and be followed by an extended period of economic stagnation."

    The conclusions came following the release of the Annual Report of the BIS, which also:

    "warned that countries such as Australia faced the possibility of a run on the currency, which would force interest rates to rise.” The BIS warned that, “a temporary respite may make it more difficult for authorities to take the actions that are necessary, if unpopular, to restore the health of the financial system, and may thus ultimately prolong the period of slow growth.

    Further, “At the same time, government guarantees and asset insurance have exposed taxpayers to potentially large losses,” and explaining how fiscal packages posed significant risks, it said that, “There is a danger that fiscal policy-makers will exhaust their debt capacity before finishing the costly job of repairing the financial system,” and that, “There is the definite possibility that stimulus programs will drive up real interest rates and inflation expectations.” Inflation “would intensify as the downturn abated,” and the BIS “expressed doubt about the bank rescue package adopted in the US.”
    http://www.theaustralian.news.com.au/story/0,,25710566-601,00.html

    Further: “The big and justifiable worry is that, before it can be reversed, the dramatic easing in monetary policy will translate into growth in the broader monetary and credit aggregates,” the BIS said. That will “lead to inflation that feeds inflation expectations or it may fuel yet another asset-price bubble, sowing the seeds of the next financial boom-bust cycle.”
    http://www.bloomberg.com/apps/news?pid=20601068&sid=aOnSy9jXFKaY

    On September 18, the Financial Times reported that:

    William White, former chief economist at the Bank for International Settlements, argued that after two years of government support for the financial system, we now have a set of banks that are even bigger - and more dangerous - than ever before. That view has been argued by Simon Johnson, former chief economist at the International Monetary Fund. He says that the finance industry has in effect captured the US government and that "recovery will fail unless we break the financial oligarchy that is blocking essential reform".
    http://www.ft.com/cms/s/0/7721033c-a3ea-11de-9fed-00144feabdc0.html?nclick_check=1

    Through stimulus packages, bailouts and the overall "attempted rescue" of the financial system, the US government has potentially guaranteed a debt totaling $23.7 TRILLION dollars, according to the man tasked with the responsibility of oversight for the financial rescue program, the Troubled-Asset Relief Program (TARP).

    "U.S. taxpayers may be on the hook for as much as $23.7 trillion to bolster the economy and bail out financial companies."
    http://www.bloomberg.com/apps/news?pid=20601087&sid=aY0tX8UysIaM

    It appears that the next one to burst may be the "Bailout Bubble," to be followed or preceded by the commercial real estate and overall derivatives bubbles, not to mention the over-inflated stock market, which poses a massive risk to the future of the economy.
  • jrs1

    Posts: 4388

    Oct 01, 2009 2:33 PM GMT
    MeOhMy said...

    "The world has not tackled the problems at the heart of the economic downturn and is likely to slip back into recession."

    ...


    the tiger once hunted
    now he has grown accustomed to being fed

  • mustangd

    Posts: 434

    Oct 01, 2009 3:32 PM GMT
    watching the ken burns mini-series on the national parks has illustrated a point about capitalism. left un-fettered, capitalism has a ravenous appetite, and will consume all before it, often in wasteful and destructive ways.

    my point, without more regulation, the banking system is operating like the old frontier, where fortunes could be made.

    we need to re-think the concept of what methods deserve that kind of reward. if a man makes his fortune constructively, more power to him. if he simply de-constructs something, or works a system for its loopholes so that his pockets a lined with someone elses gold, do we applaud that person, and use him as a role model? do we leave the system stand as it is to be further exploited?

    we need to be asking ourselves some fundamental questions, and DEMAND more from our politicians.
  • DrewT

    Posts: 1327

    Oct 01, 2009 5:37 PM GMT
    Sounds about right. From what I've read online (not sure where) the banks have begun to do exactly as they did before the crisis. This guy may be the only one in the financial sector who cares about other people.
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    Oct 01, 2009 5:49 PM GMT
    Simply_Drew saidSounds about right. From what I've read online (not sure where) the banks have begun to do exactly as they did before the crisis. This guy may be the only one in the financial sector who cares about other people.


    Yeah, but the governments have been doing the same thing as well. The banks were able to create the crisis, because it was a government-sanctioned crisis. People tend to forget the role that monetary policy played in creating the crisis, which is another major thing that White brings up.

    The Federal Reserve kept interest rates as unnaturally low levels to encourage the asset price bubble in the home real estate as well as commercial real estate markets. In turn, the Fed provided the banks with easy money, which they would loan out to high risk individuals, thus, inflating the bubble.

    This is how the Federal Reserve functioned in the run-up to the last Great Depression. It provided easy credit to banks, which used the money in speculation on the stock market, inflating it to an unsustainable level, from which it naturally collapsed.

    Only this time around, things are very different. In 1929, there was no such thing as a Adjustable Rate Mortgage, credit-default swaps, securitization, hedge funds, derivatives - the banks weren't as big, and thus, weren't as dangerous, most of the population today is urban, not rural - people survive off of credit and debt. It's not going to look the same, it will likely come out looking much worse.

    While I agree that the banks are again doing the same thing (did they ever stop? no), that created the problem, so too, are the governments of the world. by providing these "stimulus" and "bailout" packages, they have delayed the inevitable, and made the inevitable that much worse, and have done this by printing and borrowing excessive amounts of money, which can lead to inflation, some investors warn the US is headed for Weimar or even Zimbabwe hyperinflation, and a possible run on the currency. The "bailout bubble" has fed the banks and financial industry money that they have used to consolidate smaller banks, to absorb the real economy, productive economy, and to use the money in speculation - thus increasing derivatives and driving the stock market up with speculation.

    you cannot spend your way out of a crisis of spending.

    you cannot just print money out of thin air for decades and not expect repercussions. this crisis is not a little hiccup, it is endemic to the capitalist system - it is built in to the system.
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    Oct 01, 2009 6:03 PM GMT
    Ok, so what do you think should be done to correct the problem.
  • DrewT

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    Oct 01, 2009 6:27 PM GMT
    MeOhMy saidYeah, but the governments have been doing the same thing as well. The banks were able to create the crisis, because it was a government-sanctioned crisis. People tend to forget the role that monetary policy played in creating the crisis, which is another major thing that White brings up.


    Yes. I think that the banks should have been allowed to fail. That would be more in the spirit of true capitalism, a system in which America does not run. We run in a corporatist society with a republic-style government. Two wonderful truths about the US of A that no one admits to.
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    Oct 01, 2009 6:30 PM GMT
    Step 1: Remove the banks and financial industry from making the decisions about how to regulate the banks and financial industry

    2: Remove the banks and financial industry from making any decisions regarding regulating/managing the economy and controlling monetary policy

    3. this also means handing the power of issuing a currency to the Treasury, with whom such authority SHOULD rest, and taking it away from the Fed
    - the Fed, while being the principal institution behind creating the crisis, has been rewarded with being given more power and more authority. let's be logical. it creates the problem, as it has historically created MANY problems. it had its chance, time up, time to go!

    4. End the foreign imperial wars of aggression and occupation in Afghanistan and Iraq. End the assault against Pakistan. Remove troops from the Middle East and Central Asia, stop funding massive covert operations to overthrow foreign nations (such as the $400 million appropriated by Congress in 2008 to give the CIA to overthrow Iran's government). End the Empire: close foreign bases, bring troops home from everywhere. End the $800 billion defense budget. Maintaining and creating the empire is WHAT got the US into its debt position, and ultimately, the economic crisis. End the empire, and money that once went to killing people and occupying countries could now go to re-creating a middle class.

    5. build a productive economy once again. stop corporate welfare. think mom and pop, not Wal Mart. the US was largely built on innovation and yes, even competition, yet all this has been lost to the age of oligopoly capitalism.

    6. Withdraw from the World Bank, IMF, WTO, and BIS

    7. Put in place REAL regulations. Get the Glass-Steagall Act back in place, where it should have been. Keep banks from getting too big.



    ===> this is not the only possible things to do. ultimately, most of the points above are aimed at structural changes which would need to occur for any real solutions to be undertaken. As long as banks control monetary and economic policy, they will be saved, and everyone else will be screwed. Personally... i think it is far too late to stave off what is coming. It got so far, that I don't think that governments could have done anything to prevent the mess that is yet to come. But what they could have done is try to cushion the fall. Immediately begin an overhaul of regulation - managing complex financial instruments such as derivatives, preventing catastrophic speculation, etc. Instead, governments chose to bail out the culprits, give them blank checks, YOUR money (as taxpayers), and to do with it whatever they want, and then maybe... in the future, if we get around to it, we will consider imposing new regulations... after the banks write them up, and choose the regulators.

    The financial system is a fixed game, it's a scam. And ultimately, things won't change until it changes. The only real solutions are changes in the system. Anything else, at this point, is a bandaid on an amputated arm.
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    Oct 01, 2009 6:32 PM GMT
    Simply_Drew said
    MeOhMy saidYeah, but the governments have been doing the same thing as well. The banks were able to create the crisis, because it was a government-sanctioned crisis. People tend to forget the role that monetary policy played in creating the crisis, which is another major thing that White brings up.


    Yes. I think that the banks should have been allowed to fail. That would be more in the spirit of true capitalism, a system in which America does not run. We run in a corporatist society with a republic-style government. Two wonderful truths about the US of A that no one admits to.


    Agreed.
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    Oct 01, 2009 6:39 PM GMT
    Thanks for posting this. I've followed White, and have held a deep appreciation for his analysis as well as his cynicism, but White wasn't the only one to raise red flags. Several others predicted this would happen in part or full, including Ron Paul (ugh), Nouriel Roubini (NYU Professor), Senator Byron Dorgan (he did a great job predicting this mess), and Robert Shiller, to name just a few.

    We will not see a rapid and sustainable recovery in the U.S., regardless of what Paulson told us, and Bernanke prays for every night.
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    Oct 02, 2009 1:01 AM GMT
    As for your point on hyperinflation, if you read what i wrote, i said "some investors" are warning about hyperinflation.

    Well here they are (i think your argument is with them, not me):

    Legendary investor Jim Rogers has warned of “a massive inflation holocaust."
    http://www.cnbc.com/id/27097823

    Investor Marc Faber has warned that, “The U.S. economy will enter ‘hyperinflation’ approaching the levels in Zimbabwe,” and he stated that he is “100 percent sure that the U.S. will go into hyperinflation.” Further, “The problem with government debt growing so much is that when the time will come and the Fed should increase interest rates, they will be very reluctant to do so and so inflation will start to accelerate."
    http://www.bloomberg.com/apps/news?pid=20601110&sid=avgZDYM6mTFA


    As for your "picture proof" regarding mom and pop vs. Wal-Mart... is it even worth a response? You didn't even say anything.
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    Oct 02, 2009 3:17 AM GMT
    It's interesting that in none of these posts has anyone taken to task the ultimate buck stop - the consumer.

    One of the good things about it being almost impossible for anyone to get credit is that it has forced people - not all, but many - to reevaluate the concept of 'need' vs. the concept of 'want', not to mention the concept of 'earn.'

    Consumer spending is the biggest part of our economy, and consumer debt - for big things like mortages, but also smaller everyday things - ballooned to never-before-seen levels. Many consumers are paying huge amounts of interest to banks for things that they don't need but that they wanted. Retraining hundreds of millions of people to spend what they can afford, to save something for the future, and to really think before making financial decisions is long overdue. It is a chicken/egg argument, in my view, as to the role of the banks. Did they make this situation what it was by predatory lending, or did consumers willingly put them in positions where they were easy prey? When whole communities of 'starter homes' for $700k were popping up in major urban areas around the country and people making $40,000 a year were able to buy them, all parties involved in the transaction had culpability, either for being ignorant, greedy, deceptive, or all of the above.

    Since consumer spending is the largest driver of our economy, and the economy grew based on billions and billions of purchases on credit, the economy is built on a precarious cliff - inflated demand built on artificial consumer purchasing power. Yes, there are other serious issues that need to be addressed, but the accountable side of me says that it never would have gotten anywhere near as bad as it did (nor would we have experienced years of bubble-type growth) had we - collectively, if not individually - forgotten that the best way to grow and prosper is to earn it.

    Ultimately, every single individual and organization needs to evaluate for THEMSELVES when the 'worst' of this is over, and manage their spending/savings accordingly. Reverting into poor spending/savings patterns because some jackoff on CNBC tells you that the recession is over will only further damage people who had never recovered in the first place.
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    Oct 02, 2009 3:20 AM GMT
    theantijock saidBut the USA is not Zimbabwe and not surrendering without a fight its malls for plastic bag stalls.


    The USA is LOSING its shopping malls. There is a massive bubble, dwarfing the housing bubble, in commercial real estate. This one was fueled even more as the housing real estate market began to go down. This represents a huge crisis.

    The commercial real estate market is headed for a fate worse than the housing market. The signs are already there.

    In May, Bloomberg quoted Deutsche Bank CEO Josef Ackermann as saying, “It's either the beginning of the end or the end of the beginning.” Bloomberg further pointed out that, “A piece of the puzzle that must be calculated into any determination of the depth of our economic doldrums is the condition of commercial real estate -- the shopping malls, hotels, and office buildings that tend to go along with real- estate expansions.” Residential investment went down 28.9 % from 2006 to 2007, and at the same time, nonresidential investment grew 24.9%, thus, commercial real estate was “serving as a buffer against the declining housing market.”

    Commercial real estate lags behind housing trends, and so too, will the crisis, as “commercial construction projects are losing their appeal.” Further, “there are lots of reasons to suspect that commercial real estate was subject to some of the loose lending practices that afflicted the residential market. The Office of the Comptroller of the Currency's Survey of Credit Underwriting Practices found that whereas in 2003 just 2 percent of banks were easing their underwriting standards on commercial construction loans, by 2006 almost a third of them were relaxing.” In May it was reported that, “Almost 80 percent of domestic banks are tightening their lending standards for commercial real-estate loans,” and that, “we may face double-bubble trouble for real estate and the economy.”
    http://www.bloomberg.com/apps/news?pid=20601110&sid=a.X91SkgOd8g

    In late July of 2009, it was reported that, Commercial real estate’s decline is a significant issue facing the economy because it may result in more losses for the financial industry than residential real estate. This category includes apartment buildings, hotels, office towers, and shopping malls.” Worth noting is that, “As the economy has struggled, developers and landlords have had to rely on a helping hand from the US Federal Reserve in order to try to get credit flowing so that they can refinance existing buildings or even to complete partially constructed projects.” So again, the Fed is delaying the inevitable by providing more liquidity to an already inflated bubble. As the Financial Post pointed out, “From Vancouver to Manhattan, we are seeing rising office vacancies and declines in office rents.”
    http://network.nationalpost.com/np/blogs/fpmagazinedaily/archive/2009/07/23/commercial-real-estate-the-other-real-estate-bubble.aspx

    In April of 2009, it was reported that, “Office vacancies in U.S. downtowns increased to 12.5 percent in the first quarter, the highest in three years, as companies cut jobs and new buildings came onto the market,” and, “Downtown office vacancies nationwide could come close to 15 percent by the end of this year, approaching the 10-year high of 15.5 percent in 2003.”
    http://www.bloomberg.com/apps/news?pid=20601087&sid=aegH6dXG8H8U

    In the same month it was reported that, Strip malls, neighborhood centers and regional malls are losing stores at the fastest pace in at least a decade, as a spending slump forces retailers to trim down to stay afloat.” In the first quarter of 2009, retail tenants “have vacated 8.7 million square feet of commercial space,” which “exceeds the 8.6 million square feet of retail space that was vacated in all of 2008.” Further, as CNN reported, “vacancy rates at malls rose 9.5% in the first quarter, outpacing the 8.9% vacancy rate registered in all of 2008.” Of significance for those that think and claim the crisis will be over by 2010, “mall vacancies [are expected] to exceed historical levels through 2011,” as for retailers, “it's only going to get worse."
    http://money.cnn.com/2009/04/10/news/economy/retail_malls/index.htm

    Two days after the previous report, “General Growth Properties Inc, the second-largest U.S. mall owner, declared bankruptcy on [April 16] in the biggest real estate failure in U.S. history."
    http://www.reuters.com/article/businessNews/idUSTRE53F68P20090417

    In late July, the Financial Times reported that, “Two of America’s biggest banks, Morgan Stanley and Wells Fargo ... threw into sharp relief the mounting woes of the US commercial property market when they reported large losses and surging bad loan,” as “The disappointing second-quarter results for two of the largest lenders and investors in office, retail and industrial property across the US confirmed investors’ fears that commercial real estate would be the next front in the financial crisis after the collapse of the housing market.” The commercial property market, worth $6.7 trillion, “which accounts for more than 10 per cent of US gross domestic product, could be a significant hurdle on the road to recovery.”
    http://www.ft.com/cms/s/0/3a1e9d86-76eb-11de-b23c-00144feabdc0.html?nclick_check=1
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    Oct 02, 2009 3:30 AM GMT
    badmikeyt saidIt's interesting that in none of these posts has anyone taken to task the ultimate buck stop - the consumer.

    One of the good things about it being almost impossible for anyone to get credit is that it has forced people - not all, but many - to reevaluate the concept of 'need' vs. the concept of 'want', not to mention the concept of 'earn.'

    Consumer spending is the biggest part of our economy, and consumer debt - for big things like mortages, but also smaller everyday things - ballooned to never-before-seen levels. Many consumers are paying huge amounts of interest to banks for things that they don't need but that they wanted. Retraining hundreds of millions of people to spend what they can afford, to save something for the future, and to really think before making financial decisions is long overdue. It is a chicken/egg argument, in my view, as to the role of the banks. Did they make this situation what it was by predatory lending, or did consumers willingly put them in positions where they were easy prey? When whole communities of 'starter homes' for $700k were popping up in major urban areas around the country and people making $40,000 a year were able to buy them, all parties involved in the transaction had culpability, either for being ignorant, greedy, deceptive, or all of the above.

    Since consumer spending is the largest driver of our economy, and the economy grew based on billions and billions of purchases on credit, the economy is built on a precarious cliff - inflated demand built on artificial consumer purchasing power. Yes, there are other serious issues that need to be addressed, but the accountable side of me says that it never would have gotten anywhere near as bad as it did (nor would we have experienced years of bubble-type growth) had we - collectively, if not individually - forgotten that the best way to grow and prosper is to earn it.

    Ultimately, every single individual and organization needs to evaluate for THEMSELVES when the 'worst' of this is over, and manage their spending/savings accordingly. Reverting into poor spending/savings patterns because some jackoff on CNBC tells you that the recession is over will only further damage people who had never recovered in the first place.


    good points and good advice
  • mustangd

    Posts: 434

    Oct 02, 2009 4:24 AM GMT
    jprichva said
    badmikeyt said
    Since consumer spending is the largest driver of our economy, and the economy grew based on billions and billions of purchases on credit, the economy is built on a precarious cliff - inflated demand built on artificial consumer purchasing power.

    Yes, and (or but)....this brings in another overlooked point.

    The culprit here isn't so much wild consumer behavior as it is that the economy demands a certain level of consumption, and wages have stagnated over the past decade---in some real terms, over the whole Reagan and post-Reagan eras. Income inequality is the culprit here; when increased productivity gains lead to zero growth or negative growth in the average family income, but the economy demands a certain degree of consumption to function, the only avenue left is credit. This is a large part of what fueled the unsecured credit boom. And income inequality was no accident; it was planned from the outset, and carried out with ruthless efficiency.


    Yes! had not the consumer consumed at the levels he/she did post 9/11/01, our economy would've tanked then. people bought things, keeping other people in jobs. yes, it only prolonged and deepened the inevitable, but, the point is the average consumer with the credit they had, didn't finance offshore development, or move their money to offshore banks. they used it to buy a house, maybe too big of one, but, they bought things here in the u.s., or put their kids through college with their line of credit, they didn't build a factory in shang hai, or become acquainted with a bank in the cayman islands.

    indeed, where has the money that fills the gap between increases in productivity and stagnant/"rolled back" wages gone?

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    Oct 02, 2009 4:26 AM GMT
    Yes, we're pretty fucked in the future. But few know, and those who do, dont have the power to do anything. Unfortunately all we can do is wait
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    Oct 02, 2009 5:35 AM GMT
    jprichva said
    badmikeyt said
    Since consumer spending is the largest driver of our economy, and the economy grew based on billions and billions of purchases on credit, the economy is built on a precarious cliff - inflated demand built on artificial consumer purchasing power.

    Yes, and (or but)....this brings in another overlooked point.

    The culprit here isn't so much wild consumer behavior as it is that the economy demands a certain level of consumption, and wages have stagnated over the past decade---in some real terms, over the whole Reagan and post-Reagan eras. Income inequality is the culprit here; when increased productivity gains lead to zero growth or negative growth in the average family income, but the economy demands a certain degree of consumption to function, the only avenue left is credit. This is a large part of what fueled the unsecured credit boom. And income inequality was no accident; it was planned from the outset, and carried out with ruthless efficiency.


    I'm not saying it's not all interrelated. The growth, though, was always fake. The redistribution of wealth in this country has been staggering, and it is only getting worse. But at the same time, part of that wealth redistribution came in the form of people borrowing money from rich people to buy things on credit that rich people's companies created, which made them richer, except it wasn't sustainable.

    I still say that a big part of this all is all people trying to live as though they make tons of money. I think it's especially (selfishly) concerning for young gay men, who are dropping $200 on pair after pair of jeans, sunglasses, etc etc, that they can't afford but feel they have to to keep up with the gay drones. I can't even count how many gay guys I know who have horrible credit because they are trying to finance their way into coolness.
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    Oct 02, 2009 6:29 AM GMT
    jrs1 said
    MeOhMy said...

    "The world has not tackled the problems at the heart of the economic downturn and is likely to slip back into recession."

    ...


    the tiger once hunted
    now he has grown accustomed to being fed



    hmm, well put
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    Oct 02, 2009 6:59 AM GMT
    MeOhMy said
    you cannot spend your way out of a crisis of spending.



    http://www.nytimes.com/2009/10/02/opinion/02krugman.html?ref=opinion

    I do wonder what this thread is doing in the DATING, SEX, AND RELATIONSHIPS section.
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    Oct 02, 2009 8:50 AM GMT
    This video is roughly 14 minutes long, but well worth the watch.

    Francois Houtart – Member of the UN High-level task force on the financial crisis. Founder and President of the Centre Tricontinental and Professor Emeritus of Sociology at the Université Catholique de Louvain
    speaks about Progressive perspectives on solving the global economic crisis - challenging the current government responses.

  • jrs1

    Posts: 4388

    Oct 02, 2009 9:11 AM GMT
    theatrengym said
    MeOhMy said
    you cannot spend your way out of a crisis of spending.



    http://www.nytimes.com/2009/10/02/opinion/02krugman.html?ref=opinion

    I do wonder what this thread is doing in the DATING, SEX, AND RELATIONSHIPS section.


    I'm not quite sure I follow what you're saying here. MeOhMy has posted this item of business in the general discussion section, while the article from the New York Times is an op-ed piece in the opinions section.


    MeOhMy, amongst others, has done his homework. try to pay him and the thread your respect by doing yours. no, I am not trying to be rude; however, this discussion is intriguing. contribute to its confluence of information!
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    Oct 02, 2009 12:07 PM GMT
    theatrengym said
    MeOhMy said
    you cannot spend your way out of a crisis of spending.



    http://www.nytimes.com/2009/10/02/opinion/02krugman.html?ref=opinion

    I do wonder what this thread is doing in the DATING, SEX, AND RELATIONSHIPS section.

    Because he's deeply in love with Noam Chomsky.
    It's sort of touching. When I was an undergraduate I was too. Eventually he'll grow up, buy a loft, drive a BMW, and look back fondly on his days as a student leftist.
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    Oct 02, 2009 12:15 PM GMT
    oh wait, i forget... which one of the above sources is Noam Chomsky?

    Oh right. None of them.

    Believe it or not, my perspectives have come from learning to think for myself, not blindly follow anyone.

    I don't even read Chomsky.

    My sources above are... financial press and the "most prestigious" financial institution in the world. Which one of those does Noam Chomsky inform or command? Hmmm... let's ponder your statement again.... does it EVEN make sense?

    'nuff said
  • jrs1

    Posts: 4388

    Oct 02, 2009 12:21 PM GMT
    I ... like Noam Chomsky ... because I enjoy linguistics. that does not, at the moment, help contribute to my understanding in terms of this discussion in this - here and now - thread. again ... let's not call names ... if MeOhMy is a " leftist " ... then support your claim with evidence ... not trash talk and normative discussion. gurl, I can read People for that ...