Discussion:
Pat Buchanan attacks Finance Capitalism.
(too old to reply)
death from above
2008-09-28 22:20:47 UTC
Permalink
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
john fernbach
2008-09-28 23:09:56 UTC
Permalink
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
This is interesting, but I think Pat Buchanan misstates one important
point in his blog, and he also neglects another one.

1. The one that he misstates relates to the idea of the Federal
Government, out of concern for the less advantaged mortgage-seekers,
"pressuring" the private banks and Wall Street to buy up all of those
mortgage-backed securities or collateralized debt obligations (CDOs)
along with other financial junk.

The fact is that plenty of people in the banking and financial world
were making huge amounts of money by speculating in CDOs.

There may have been some Big Government pressure to get the CDO
industry started, but for the past 10 years Wall Street hasn't been
investing in these now-worthless securities because Washington told
them to, or because the Wall Streeters wanted to let some poor single
mom in the innner city to buy a condo. Wall Street was in the CDO
market for PROFIT - for BIG profit, they hoped.

And the same is true for financial groups like Countrywide Financial,
which eagerly accumulated big fees for hooking people up with "sub-
prime" and variable rate mortgages, with the full realization that a
lot of these people couldn't afford the mortgages in the long term.

Countrywide Financial made big money doing this stuff, until it
didn't. And then of course it chopped up the risky mortgages into
CDOs that then were sold ... to the speculators on Wall Street.

Some poor and minority home buyers, and some middle class home buyers
who just got greedy, may have gotten some temporary gains from the
whole subprime mortgage industry.

But it was PROFIT and not liberal government regulations that got the
Wall Street investors, the big bankers, the hedge funds and the
Countrywide Financial finance people into this game.

2. The second point that Buchanan neglects, in fact he doesn't even
notice it, is the question of WHY the American economy has moved from
being manufacturing-driven 30 years ago to being increasingly finance-
driven today.

Global free trade is no doubt part of the problem, and government
regulations may have inspired some US-based corporations to flee
overseas where they can make more money.

High wages for US workers, of course, are another factor that has
inspired "American" cormpanies to become transnational or
multinational companies, and to move their operations overseas.

If American workers 30 years ago had been willing to accept, say,
Chinese wages and a Chinese standard of living at the time, maybe the
big manufacturing companies would have kept their factories open here
at home. But of course, American workers would then have been earning
Chinese wages -- and how good would that have been?

But if you read your economic and financial industry carefully, I
think you have to conclude that it wasn't ONLY free trade and it
wasn't ONLY American wages and American economic regulations that have
inspired manufacturing companies to move to Asia, while this country
turned increasingly to an economy based on financial speculation.

Another big problem is that for the past 30 -40 years, dating back to
the 1970s, the whole world economy has faced a chronic threat of
"surplus capacity," "overcapacity" in key industries.

In plain English, the world since 1980 has had more than enough
automobile factories, more than enough chemical plants, more than
enough steel mills, more than enough shipyards, and more than enough
textile factories to provide all of these products that the market can
afford to buy -- at least given prevailing wage and income levels, and
prevailing consumer demand.

As a lot of American business magazines recognized in the 1980s, even
before the rise of China's industrial economy, the structure of the
world economy at the time meant that there was no real need for
additional investment in automobile, steel, chemicals, rubber,
shipbuilding and textile plants in the US.

In fact during the 1980s there often wasn't nearly enough American
demand for food to make it possible for American farmers to sell all
of the corn, wheat, soybeans, milk etc. that they were producing.

So given that the American industrial and agricultural markets in the
1980s were in a real sense "overbuilt," where were Wall Street
investors big and small going to put their money, in order to return
good returns on it?

Well, one thing that many investors obviously did was to invest in
"offshore" funds that financed economic expansion in India, China,
Thailand, Mexico, and other Third World locations -- even in Russia,
for awhile there. The profits on foreign investments simply were
greater than the profits on US-only investments, and so the smart
money tended to go there.

But the other thing that individual investors and big investment
houses have done is to put money into financial speculation -- not
into the production of manufactured goods and foodstuffs for markets
that already have enough of these things.

Result: The "financialization" of the US and also the global economy,
the conversion of an investment process that once financed American
industrial expansion into a different process that finances
speculative manias and bubbles, along with Chinese growth.

Whoever posted this link to Buchanan's blog calls this "finance
capitalism." But the problem doesn't only lie with the finance
houses, with the Wall Street speculators, nor with the government.

The problem partly is a flaw in * capitalism* itself, in an economic
system that is so fabulously productive in its ability to make goods
that it gluts its own markets, forcing supposedly smart investors into
risky gambles on financial speculation.

I don't think anybody has a very good plan for fixing capitalism;
obviously the old Soviet Union and the Communist satellite states that
surrounded it never did a very good job.

But the system nevertheless is broken, and it does need to be fixed or
replaced somehow. And just getting mad at the bankers or at the
politicians is not going to be enough.
r***@comcast.net
2008-09-29 00:55:15 UTC
Permalink
On Sun, 28 Sep 2008 16:09:56 -0700 (PDT), john fernbach
Post by john fernbach
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
This is interesting, but I think Pat Buchanan misstates one important
point in his blog, and he also neglects another one.
1. The one that he misstates relates to the idea of the Federal
Government, out of concern for the less advantaged mortgage-seekers,
"pressuring" the private banks and Wall Street to buy up all of those
mortgage-backed securities or collateralized debt obligations (CDOs)
along with other financial junk.
The fact is that plenty of people in the banking and financial world
were making huge amounts of money by speculating in CDOs.
And they pressed COngress and Fannie and Freddie to take more.
john fernbach
2008-09-29 01:25:00 UTC
Permalink
Post by r***@comcast.net
On Sun, 28 Sep 2008 16:09:56 -0700 (PDT), john fernbach
Post by john fernbach
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
This is interesting, but I think Pat Buchanan misstates one important
point in his blog, and he also neglects another one.
1.  The one that he misstates relates to the idea of the Federal
Government, out of concern for the less advantaged mortgage-seekers,
"pressuring" the private banks and Wall Street to buy up all of those
mortgage-backed securities or collateralized debt obligations (CDOs)
along with other financial junk.
The fact is that plenty of people in the banking and financial world
were making huge amounts of money by speculating in CDOs.
And they pressed COngress and Fannie and Freddie to take more.- Hide quoted text -
- Show quoted text -
I guess they did - don't know the details about that.

I know that some economists and many more bloggers also blame Alan
Greenspan of the Federal Reserve Board for repeatedly increasing the
money supply and lowering short-term interest rates when the economic
indicators suggested that he should be raising them.

Joseph Stiglitz, a Nobel-prize-winning economist who served for awhile
in Bill Clinton's administration, also has written that the Clinton
White House bears some of the blame for the financial excesses that
were already starting to become obvious in the 1980s.

Stiglitz's book on this subject is called "The Roaring Nineties," with
the introduction indicating that he deliberately was making a
comparison with the "Roaring Twenties" that preceded the 1929 stock
market crash on Wall Street and the start of the Great Depression of
the 1930s.

What Stiglitz writes is that the Clinton administration contributed to
the "Roaring Nineties," and indirectly to the Dot-Com bubble and
recession that ended the decade -- but NOT by burdening the economy
with "Big Government," as Pat Buchanan is suggesting.

The problem with Clinton's economic team, Stiglitz suggests, is that
people in the "Treasury Department" -- he's clearly talking about
Robert Rubin, former Goldman Sachs chief on Wall Street, and Larry
Summers, former economist with the World Bank -- were hell bent on
freeing up "markets," including financial markets, as the supposed
path to world prosperity.

Because of the Clinton administration's almost "Republican" faith in
markets, at least when it came to Treasury Dept. policies, the Clinton
White House favored the repeal of the Glass Steagall Act, the key
federal law that had restrained speculation by the banking industry
since the 1930s.

In hopes of giving the CEOs of big US corporations an added incentive
for doing what was good for the institutions they headed up, the
Clintonites also supported changes in corporate regulations that
allowed CEOs to get paid enormous bonuses in the form of stock
options.

Stiglitz in retrospect thinks that this, too, was a bad mistake and
one that fed the forces of reckless financial speculation in the
economy.

Wall Street and the banking industry, of course, loved this aspect of
Clinton's adminstration. He was getting beaten up by Rush Limbaugh
and the GOP attack machine for supposedly being "liberal," and of
course also for being a low-down hound dog when it came to putting the
moves on women

But for all the myths that were getting circulated about the "liberal"
Clinton administration, in many of their financial policies and their
trade policies, they were giving Corporate America and Wall Street
exactly what the business elite wanted.

I think it's too bad that Buchanan's conservative mindset keeps him
from seeing that what was wrong with the Clinton White House was not
its Big Government "liberalism," but its "moderate" or in fact rather
conservative Democratic support for deregulation.
r***@comcast.net
2008-09-29 16:03:50 UTC
Permalink
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
I know that some economists and many more bloggers also blame Alan
Greenspan of the Federal Reserve Board for repeatedly increasing the
money supply and lowering short-term interest rates when the economic
indicators suggested that he should be raising them.
I'm hearing that but it doesn't make sense to me. It seems like
scapegoating. The economy was exceedingly stagnant in 2001-2003. We
were hemorrhaging jobs. Consumer demand was in the toilet. GDP was
scraping by. Low interest rates were the standard monetarist solution
to ending the recession and fighting the worsening employment picture.
Throw in 9-11 and the hit the economy took with that - low interest
rates made a lot of sense and did what they were supposed to by
fueling building and jobs. (Now we could take an aside on how many of
those formerly good paying jobs went to illegals and what made that
possible - but that's a different story.)

I will grant hat as the housing bubble heated up something needed to
be done to slow it. I'm unclear on what the fed could have done in
that. I think if the cop had be4n on the beat enforcing lending laws,
etc. we might have averted this crash.
john fernbach
2008-09-29 20:01:48 UTC
Permalink
Post by r***@comcast.net
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
I know that some economists and many more bloggers also blame Alan
Greenspan of the Federal Reserve Board for repeatedly increasing the
money supply and lowering short-term interest rates when the economic
indicators suggested that he should be raising them.
I'm hearing that but it doesn't make sense to me. It seems like
scapegoating.  The economy was exceedingly stagnant in 2001-2003. We
were hemorrhaging jobs. Consumer demand was in the toilet. GDP was
scraping by. Low interest rates were the standard monetarist solution
to ending the recession and fighting the worsening employment picture.
Throw in 9-11 and the hit the economy took with that - low interest
rates made a lot of sense and did what they were supposed to by
fueling building and jobs. (Now we could take an aside on how many of
those formerly good paying jobs went to illegals and what made that
possible - but that's a different story.)
I will grant hat as the housing bubble heated up something needed to
be done to slow it. I'm unclear on what the fed could have done in
that. I think if the cop had be4n on the beat enforcing lending laws,
etc. we might have averted this crash.
Maybe so - but then, why didn't we avert all of the financial crashes
that preceded this one?

(a) The 1987 "Black Monday" crash on Wall Street, that drove the Dow
average down 508 points and caused financial ripples around the world?

(b) The Savings & Loan industry crisis of 1985-early 1990s, that
caused more than 700 US thrift institutions to fail, and cost the US
taxpayer an estimated $120 billion in cleanup costs?

(c) What about the Third World debt crisis of the early 1980s, that
caused a fall in average incomes in Latin America that lasted for a
decade, and that put many less-developed economies in Sub-Saharan
Africa basically underwater?

(d) What about the Mexican peso crisis of 1994, and the Long Term
Capital Management crisis of 1998, that were contained at the last
minute, but momentarily threatened to destablize the world economy?

(e) What about the Asian financial crisis of 1997, that spread
economic havoc through Thailand, Indonesia, South Korea etc.?

(f) And what about the "Dot Com bubble" of 1995-2000, and the US
recession that followed it?

(g) What about the meltdown of Enron, Worldcom, and a host of other
over-valued American companies in 2001?

Greenspan took actions that may have helped bring on SOME of these
financial panics, and he took actions in response to other panics that
may have made the long-term economy worse.

But Greenspan wasn't even in office in 1981, when the Third World Debt
Crisis hit, and I've never seen anyone who argues that he had a lot to
do with the Savings & Loan crisis of 1985-1990.

There's something wrong with the whole financial structure, isn't
there? And maybe with our entire model of capitalism?

Because it doesn't seem to matter what policies the government follows
-- free market deregulation, anti-market regulation, tight money or
loose money. It also doesn't matter that much whether a Republican or
a Democrat inhabits the White House.

No matter what Uncle Sam does, the Wall Street stock market mavens and
the investment bankers
just go from one speculative "bubble" to another, don't they?

Maybe we need to think about why.
r***@comcast.net
2008-09-29 20:25:30 UTC
Permalink
On Mon, 29 Sep 2008 13:01:48 -0700 (PDT), john fernbach
Post by john fernbach
Post by r***@comcast.net
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
I know that some economists and many more bloggers also blame Alan
Greenspan of the Federal Reserve Board for repeatedly increasing the
money supply and lowering short-term interest rates when the economic
indicators suggested that he should be raising them.
I'm hearing that but it doesn't make sense to me. It seems like
scapegoating.  The economy was exceedingly stagnant in 2001-2003. We
were hemorrhaging jobs. Consumer demand was in the toilet. GDP was
scraping by. Low interest rates were the standard monetarist solution
to ending the recession and fighting the worsening employment picture.
Throw in 9-11 and the hit the economy took with that - low interest
rates made a lot of sense and did what they were supposed to by
fueling building and jobs. (Now we could take an aside on how many of
those formerly good paying jobs went to illegals and what made that
possible - but that's a different story.)
I will grant hat as the housing bubble heated up something needed to
be done to slow it. I'm unclear on what the fed could have done in
that. I think if the cop had be4n on the beat enforcing lending laws,
etc. we might have averted this crash.
Maybe so - but then, why didn't we avert all of the financial crashes
that preceded this one?
I don';t understand your question.
Post by john fernbach
(a) The 1987 "Black Monday" crash on Wall Street, that drove the Dow
average down 508 points and caused financial ripples around the world?
No cop.
Post by john fernbach
(b) The Savings & Loan industry crisis of 1985-early 1990s, that
caused more than 700 US thrift institutions to fail, and cost the US
taxpayer an estimated $120 billion in cleanup costs?
No cop and derg.
Post by john fernbach
(c) What about the Third World debt crisis of the early 1980s, that
caused a fall in average incomes in Latin America that lasted for a
decade, and that put many less-developed economies in Sub-Saharan
Africa basically underwater?
US desired policy to put them on the hook to us.
Post by john fernbach
(d) What about the Mexican peso crisis of 1994, and the Long Term
Capital Management crisis of 1998, that were contained at the last
minute, but momentarily threatened to destablize the world economy?
Cop on the beat. Intelligent team finessed.
Post by john fernbach
(e) What about the Asian financial crisis of 1997, that spread
economic havoc through Thailand, Indonesia, South Korea etc.?
(f) And what about the "Dot Com bubble" of 1995-2000, and the US
recession that followed it?
(g) What about the meltdown of Enron, Worldcom, and a host of other
over-valued American companies in 2001?
Greenspan took actions that may have helped bring on SOME of these
financial panics, and he took actions in response to other panics that
may have made the long-term economy worse.
But Greenspan wasn't even in office in 1981, when the Third World Debt
Crisis hit, and I've never seen anyone who argues that he had a lot to
do with the Savings & Loan crisis of 1985-1990.
I;m having difficulty finding what your point is. I noted I thought
Greenspan had little choice and did what he should - except when
Congress gave him authority to deflate the housing bubble and he
didn't use it.
Post by john fernbach
There's something wrong with the whole financial structure, isn't
there? And maybe with our entire model of capitalism?
The globalization fanatics and the libertarian less government crowd
are continually pushing for dereg for short term profits. We need to
go back to sane trade policies of the 50-70s. Tariffs to favor US
jobs. And a good labor good wages policy instead of these cut throat
cheap labor policies. And encouraging off shoring.
Post by john fernbach
Because it doesn't seem to matter what policies the government follows
-- free market deregulation, anti-market regulation, tight money or
loose money. It also doesn't matter that much whether a Republican or
a Democrat inhabits the White House.
I don't see that. The policies matter. Note Clinton finessed several
major crises and kept us int he black. Reagan and Bush I and 2
embraced deregulation and globalization a nd cheap labor and gave us 4
recessions. Policies and leadership matter.
Post by john fernbach
No matter what Uncle Sam does, the Wall Street stock market mavens and
the investment bankers
just go from one speculative "bubble" to another, don't they?
If allowed to and if government enables their greed.
Post by john fernbach
Maybe we need to think about why.
Human nature. That's why we have society and laws.
Michael Coburn
2008-09-29 23:22:47 UTC
Permalink
Post by r***@comcast.net
On Mon, 29 Sep 2008 13:01:48 -0700 (PDT), john fernbach
Post by john fernbach
Post by r***@comcast.net
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
I know that some economists and many more bloggers also blame Alan
Greenspan of the Federal Reserve Board for repeatedly increasing the
money supply and lowering short-term interest rates when the economic
indicators suggested that he should be raising them.
I'm hearing that but it doesn't make sense to me. It seems like
scapegoating.  The economy was exceedingly stagnant in 2001-2003. We
were hemorrhaging jobs. Consumer demand was in the toilet. GDP was
scraping by. Low interest rates were the standard monetarist solution
to ending the recession and fighting the worsening employment picture.
Throw in 9-11 and the hit the economy took with that - low interest
rates made a lot of sense and did what they were supposed to by
fueling building and jobs. (Now we could take an aside on how many of
those formerly good paying jobs went to illegals and what made that
possible - but that's a different story.)
I will grant hat as the housing bubble heated up something needed to
be done to slow it. I'm unclear on what the fed could have done in
that. I think if the cop had be4n on the beat enforcing lending laws,
etc. we might have averted this crash.
Maybe so - but then, why didn't we avert all of the financial crashes
that preceded this one?
I don';t understand your question.
Post by john fernbach
(a) The 1987 "Black Monday" crash on Wall Street, that drove the Dow
average down 508 points and caused financial ripples around the world?
No cop.
Post by john fernbach
(b) The Savings & Loan industry crisis of 1985-early 1990s, that caused
more than 700 US thrift institutions to fail, and cost the US taxpayer
an estimated $120 billion in cleanup costs?
No cop and derg.
Post by john fernbach
(c) What about the Third World debt crisis of the early 1980s, that
caused a fall in average incomes in Latin America that lasted for a
decade, and that put many less-developed economies in Sub-Saharan Africa
basically underwater?
US desired policy to put them on the hook to us.
Post by john fernbach
(d) What about the Mexican peso crisis of 1994, and the Long Term
Capital Management crisis of 1998, that were contained at the last
minute, but momentarily threatened to destablize the world economy?
Cop on the beat. Intelligent team finessed.
Post by john fernbach
(e) What about the Asian financial crisis of 1997, that spread economic
havoc through Thailand, Indonesia, South Korea etc.?
(f) And what about the "Dot Com bubble" of 1995-2000, and the US
recession that followed it?
(g) What about the meltdown of Enron, Worldcom, and a host of other
over-valued American companies in 2001?
Greenspan took actions that may have helped bring on SOME of these
financial panics, and he took actions in response to other panics that
may have made the long-term economy worse.
But Greenspan wasn't even in office in 1981, when the Third World Debt
Crisis hit, and I've never seen anyone who argues that he had a lot to
do with the Savings & Loan crisis of 1985-1990.
I;m having difficulty finding what your point is. I noted I thought
Greenspan had little choice and did what he should - except when
Congress gave him authority to deflate the housing bubble and he didn't
use it.
Post by john fernbach
There's something wrong with the whole financial structure, isn't there?
And maybe with our entire model of capitalism?
The globalization fanatics and the libertarian less government crowd are
continually pushing for dereg for short term profits. We need to go
back to sane trade policies of the 50-70s. Tariffs to favor US jobs. And
a good labor good wages policy instead of these cut throat cheap labor
policies. And encouraging off shoring.
Post by john fernbach
Because it doesn't seem to matter what policies the government follows
-- free market deregulation, anti-market regulation, tight money or
loose money. It also doesn't matter that much whether a Republican or a
Democrat inhabits the White House.
I don't see that. The policies matter. Note Clinton finessed several
major crises and kept us int he black. Reagan and Bush I and 2 embraced
deregulation and globalization a nd cheap labor and gave us 4
recessions. Policies and leadership matter.
Post by john fernbach
No matter what Uncle Sam does, the Wall Street stock market mavens and
the investment bankers
just go from one speculative "bubble" to another, don't they?
If allowed to and if government enables their greed.
Post by john fernbach
Maybe we need to think about why.
Human nature. That's why we have society and laws.
Think about what happens if the dollar loses another 50% of its value
from where it is. Think about it real good because that will do what
needs doing. No more imports and the price of gasoline will be $8 - $10
a gallon. No more war because we can't afford it.

We will need government programs to help the people who have to drive a
used pickup truck to the job in order to eat and have a place to live.
And we will need government to create the largest health insurance group
in the world right here in the USA. There will be a need for
representative government where the people are represented as opposed to
the special interests and the games players.

We need to inject money NOT INTO THE BANKS AND THE FINANCIAL COMPANIES.
We need to inject money at the bottom so that people will have the money
to pay the mortgages. And that __WILL__ induce inflation. So be it.
Michael Coburn
2008-09-29 23:14:02 UTC
Permalink
Post by john fernbach
Post by r***@comcast.net
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
I know that some economists and many more bloggers also blame Alan
Greenspan of the Federal Reserve Board for repeatedly increasing the
money supply and lowering short-term interest rates when the economic
indicators suggested that he should be raising them.
I'm hearing that but it doesn't make sense to me. It seems like
scapegoating.  The economy was exceedingly stagnant in 2001-2003. We
were hemorrhaging jobs. Consumer demand was in the toilet. GDP was
scraping by. Low interest rates were the standard monetarist solution
to ending the recession and fighting the worsening employment picture.
Throw in 9-11 and the hit the economy took with that - low interest
rates made a lot of sense and did what they were supposed to by fueling
building and jobs. (Now we could take an aside on how many of those
formerly good paying jobs went to illegals and what made that possible
- but that's a different story.)
I will grant hat as the housing bubble heated up something needed to be
done to slow it. I'm unclear on what the fed could have done in that. I
think if the cop had be4n on the beat enforcing lending laws, etc. we
might have averted this crash.
Maybe so - but then, why didn't we avert all of the financial crashes
that preceded this one?
(a) The 1987 "Black Monday" crash on Wall Street, that drove the Dow
average down 508 points and caused financial ripples around the world?
(b) The Savings & Loan industry crisis of 1985-early 1990s, that caused
more than 700 US thrift institutions to fail, and cost the US taxpayer
an estimated $120 billion in cleanup costs?
Deregulation of the thrifts that allowed them to "create money" as
commercial banks do and the increase in FDIC coverage from $10k to
$100k. Republicans A G A I N !!!
Post by john fernbach
(c) What about the Third World debt crisis of the early 1980s, that
caused a fall in average incomes in Latin America that lasted for a
decade, and that put many less-developed economies in Sub-Saharan Africa
basically underwater?
Not My Problem.
Post by john fernbach
(d) What about the Mexican peso crisis of 1994, and the Long Term
Capital Management crisis of 1998, that were contained at the last
minute, but momentarily threatened to destablize the world economy?
More speculation, more derivatives, more Republican crap.
Post by john fernbach
(e) What about the Asian financial crisis of 1997, that spread economic
havoc through Thailand, Indonesia, South Korea etc.?
(f) And what about the "Dot Com bubble" of 1995-2000, and the US
recession that followed it?
BZZZZZZZZZZTTTTTTT!!!!!!!!!!! That "bubble" Was from 1998 - 2000 and it
was caused by CEO lying and the Republican's veto proof "Taxpayer Relief
Act of 1997".

http://en.wikipedia.org/wiki/Taxpayer_Relief_Act_of_1997
http://www.filetax.com/97taxact.html#gains
Post by john fernbach
(g) What about the meltdown of Enron, Worldcom, and a host of other
over-valued American companies in 2001?
Caused by the Enron Loophole created by Foreclosure Phil.
http://www.motherjones.com/news/feature/2008/07/foreclosure-phil.html
http://en.wikipedia.org/wiki/Commodity_Futures_Modernization_Act_of_2000
Post by john fernbach
Greenspan took actions that may have helped bring on SOME of these
financial panics, and he took actions in response to other panics that
may have made the long-term economy worse.
But Greenspan wasn't even in office in 1981, when the Third World Debt
Crisis hit, and I've never seen anyone who argues that he had a lot to
do with the Savings & Loan crisis of 1985-1990.
There's something wrong with the whole financial structure, isn't there?
And maybe with our entire model of capitalism?
Because it doesn't seem to matter what policies the government follows
-- free market deregulation, anti-market regulation, tight money or
loose money. It also doesn't matter that much whether a Republican or a
Democrat inhabits the White House.
BZZZZZZZZZZZZZZZZZZZZZZZZZZZZTTTTTTTTTTTTTTTT!!!!!!!!!!!!!!!!
It's the Congress, stupid. The Congress makes the laws and the House of
Representatives are supposed to impeach the (P)resident if the (P)
resident does not enforce the laws. That is the way it is drawn up on the
chalkboard called the Constitution of the United States.
Post by john fernbach
No matter what Uncle Sam does, the Wall Street stock market mavens and
the investment bankers
just go from one speculative "bubble" to another, don't they?
Maybe we need to think about why.
Yes. We certainly need to do that. It is interesting that the
Republicans controlled the entire government during the 1929 catastrophe
also. Much too much is made over which party the (P)resident represents.
The (P)resident is to do damned well what the Congress tells him to. The
problem we have right now is that the (P)resident and the Senate are both
controlled by the Republicans and they prevent any progressive change.
Add to that the spineless "impeachment off the table" Democrats and you
have a stagflation in the government. A (P)resident with an approval
rating in the toilet, a Senate that supports him in spite of it, and no
way to do anything about it.
r***@comcast.net
2008-09-29 16:11:45 UTC
Permalink
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
Stiglitz's book on this subject is called "The Roaring Nineties," with
the introduction indicating that he deliberately was making a
comparison with the "Roaring Twenties" that preceded the 1929 stock
market crash on Wall Street and the start of the Great Depression of
the 1930s.
What Stiglitz writes is that the Clinton administration contributed to
the "Roaring Nineties," and indirectly to the Dot-Com bubble and
recession that ended the decade -- but NOT by burdening the economy
with "Big Government," as Pat Buchanan is suggesting.
The problem with Clinton's economic team, Stiglitz suggests, is that
people in the "Treasury Department" -- he's clearly talking about
Robert Rubin, former Goldman Sachs chief on Wall Street, and Larry
Summers, former economist with the World Bank -- were hell bent on
freeing up "markets," including financial markets, as the supposed
path to world prosperity.
Because of the Clinton administration's almost "Republican" faith in
markets, at least when it came to Treasury Dept. policies, the Clinton
White House favored the repeal of the Glass Steagall Act, the key
federal law that had restrained speculation by the banking industry
since the 1930s.
In hopes of giving the CEOs of big US corporations an added incentive
for doing what was good for the institutions they headed up, the
Clintonites also supported changes in corporate regulations that
allowed CEOs to get paid enormous bonuses in the form of stock
options.
Stiglitz in retrospect thinks that this, too, was a bad mistake and
one that fed the forces of reckless financial speculation in the
economy.
I agree with this. Mostly. Clinton had the globalization religion and
opening markets urges. He did move the ball down the field for that.

At the same time he did it with a realization of some of its negative
impacts and hence had some job protections, environmental protections,
etc. and he believed in the role of government to keep transaction
fair and honest and transparent - he kept the cop on the beat and
regulated abuses. That ameliorated a lot of the negatives some.
Enough so that the negatives did not flood out the positives during
his terms.

But yes Clinton rode and pushed the wave. He fought his party for
NAFTA.
r***@comcast.net
2008-09-29 16:12:37 UTC
Permalink
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
But for all the myths that were getting circulated about the "liberal"
Clinton administration, in many of their financial policies and their
trade policies, they were giving Corporate America and Wall Street
exactly what the business elite wanted.
His sound fiscal policies led Greenspan to call him "The best
republican President he had served."
john fernbach
2008-09-29 20:05:58 UTC
Permalink
Post by r***@comcast.net
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
But for all the myths that were getting circulated about the "liberal"
Clinton administration, in many of their financial policies and their
trade policies, they were giving Corporate America and Wall Street
exactly what the business elite wanted.
His sound fiscal policies led Greenspan to call him "The best
republican President he had served."
I'd never heard Greenspan quoted to that effect, but it sounds right.

Washington Post reporter Bob Woodward, in a book on Clinton's early
economic program proposals called "The Agenda," writes that soon after
taking office in 1993, Clinton convened a group of different Cabinet
members who outlined different conservative economic initiatives the
White House needed to support.

After listening for awhile, he burst out: "Where are the Democrats
in this room? Where have all the Democrats gone?"

Of words to that general effect. You can find the exact quote in
Woodward's book if you look for it.
r***@comcast.net
2008-09-29 20:27:35 UTC
Permalink
On Mon, 29 Sep 2008 13:05:58 -0700 (PDT), john fernbach
Post by john fernbach
Post by r***@comcast.net
On Sun, 28 Sep 2008 18:25:00 -0700 (PDT), john fernbach
Post by john fernbach
But for all the myths that were getting circulated about the "liberal"
Clinton administration, in many of their financial policies and their
trade policies, they were giving Corporate America and Wall Street
exactly what the business elite wanted.
His sound fiscal policies led Greenspan to call him "The best
republican President he had served."
I'd never heard Greenspan quoted to that effect, but it sounds right.
Washington Post reporter Bob Woodward, in a book on Clinton's early
economic program proposals called "The Agenda," writes that soon after
taking office in 1993, Clinton convened a group of different Cabinet
members who outlined different conservative economic initiatives the
White House needed to support.
After listening for awhile, he burst out: "Where are the Democrats
in this room? Where have all the Democrats gone?"
Of words to that general effect. You can find the exact quote in
Woodward's book if you look for it.
Yep. His book on Greenspan has a lot on this too.

But it was another case of the ridiculous fiscal policy poisoning the
well so the democrats had to house clean before they could move their
agenda. We're looking at that again. Clinton's advisors were telling
him he had to get the fiscal house in order before he could AFFORD to
do the things he wanted.
v***@at.BioStrategist.dot.dot.com
2008-09-29 07:00:39 UTC
Permalink
I always said Social Conservatives were SocialIST Conservatives.


- = -
Vasos Panagiotopoulos, Columbia'81+, Reagan, Mozart, Pindus, BioStrategist
http://ourworld.compuserve.com/homepages/vjp2/vasos.htm
---{Nothing herein constitutes advice. Everything fully disclaimed.}---
[Homeland Security means private firearms not lazy obstructive guards]
[Urb sprawl confounds terror] [Remorse begets zeal] [Windows is for Bimbos]
b***@aol.com
2008-09-29 14:53:30 UTC
Permalink
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
Pat Buchanan for president!
r***@comcast.net
2008-09-29 16:13:19 UTC
Permalink
Post by b***@aol.com
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
Pat Buchanan for president!
Hi Ms. Palin! How's the race going?
Jerry Kraus
2008-09-29 16:19:50 UTC
Permalink
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
Well, no. This isn't big government. This is robber baron
Capitalism, pure and simple. Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests. So, what else is new?
john fernbach
2008-09-29 20:18:44 UTC
Permalink
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
Well, no.  This isn't big government.  This is robber baron
Capitalism, pure and simple.  Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests.   So, what else is new?
I'm call myself a democratic socialist, and I partly agree with this
statement, but I think it's a little unfair.

What Marx thought about capitalism was that in the long run, it would
face a crisis of declining profit rates brought on by its own drive
for never-ending capital investment. Capitalism's worst enemy in the
long run, he wisecracked, would turn out to be itself.

What this suggests to me is that whether they're "robber barons" or
not, the capitalists are trying hard to ride a rodeo horse that they
basically can't control -- that nobody can really control.

Yes, their greed and their habit of looking at reality through a very
narrow lens, one shaped by their endless pursuit of profits, do cause
many of the system's worst problems.

But whatever the cause, capitalism does genuinely create terrible
problems for at least many of the people who support it and profit
from it.

How do they try to solve the economic problems that their own system
has created. When he was 30 years old and full of spunk and looking at
the British capitalism he saw in existence in 1848, Marx wrote that
the modern political state is "nothing more than the executive
committee of the bourgeoisie."

And while I don't think we should take Marx's word for everything,
there's a grain of truth in this. When the capitalist "free market"
gets into bad trouble, which it does every so often, the smartest
capitalists turn to "big government" or at least turn to "government"
to get the economy back on track and functioning again.

Does this government economic intervention that the leading
capitalists themselves call for -- does it necessarily produce the
best results for society?

I think the conservatives and the libertarians are right when they
insist that the answer is no -- that both the business lobbyists and
the government bureaucrats often use "the State" not to impose the
best solution on the market, but all too often to serve various
special interests.

But in any case, I don't think that "robber barons" and "Big
Government" are incompatible. Sometimes they support one another;
sometimes they don't. But if "Big Government" is involved in creating
or fixing a crisis, that doesn't mean big capitalist corporations and
big capitalist investors are not involved. It's not like they're oil
and water, never mixing.
steve
2008-09-29 21:43:02 UTC
Permalink
Post by john fernbach
Well, no.  This isn't big government.  This is robber baron
Capitalism, pure and simple.  Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests.   So, what else is new?
I'm call myself a democratic socialist, and I partly agree with this
statement, but I think it's a little unfair.
It's not simply unfair, but false. The problem is in the mixture of govt
guarantees (implicit in FNMA and explicit in FDIC) and regulatory pressure
to make insecure loans (Community Redevelopment Act, and various problematic
adjustments to same..pushed primarily by democrats, esp Bill Clinton), plus
the cheap money that the Bush admin started pumping into the economy after
9-11 (via the printing press and the fed res). All this created competitive
pressure to make bad loans (no money down, unqualified buyers), which in
turn fueled a run up in the housing market. When the market dropped, the
insecure mortgages were worth nothing and anyone holding mortgage backed
securities was also in trouble. This is a failure of a poisonous
combination of poorly structured regulation and aggressive monetarism. The
market only responded to the perverse incentives created by that
combination. Many saw it coming, but there was no political advantage in
acting responsibly.

steve
--
"Those who are merciful to the cruel will be cruel to the merciful."
from the Talmud
r***@comcast.net
2008-09-29 22:32:19 UTC
Permalink
Post by steve
The
market only responded to the perverse incentives created by that
combination.
Chuckle. And that led appraisers to lie, and mortgage brokers to lie
and insurance agents to lie.
steve
2008-09-30 13:36:23 UTC
Permalink
Post by r***@comcast.net
Post by steve
The
market only responded to the perverse incentives created by that
combination.
Chuckle. And that led appraisers to lie, and mortgage brokers to lie
and insurance agents to lie.
I have a close friend who does RE Appraisals (quite busy lately with
foreclosures), and he tells me that recent purchase prices weigh heavily in
that calculation. A rising market leads to rising appraisals, and that
makes perfect sense and does not suggest fraud. I have no doubt that the
demand for mortgages and the excess of available cash (which I mentioned)
caused standards to be relaxed to an absurd level. When people could get a
loan with no money down and little more than a signiture (and many did), the
potential downside for lenders is obvious. That is incompetance and poor
judegement, but not fraud. Why did they act that way? Ive already
explained that. What is the solution? Remove govt guarantees and
regulations. Restore responsible behavior to the market by restoring
responsibility for actions taken.

steve
--
"Those who are merciful to the cruel will be cruel to the merciful."
from the Talmud
r***@comcast.net
2008-09-30 15:22:34 UTC
Permalink
Post by steve
I have a close friend who does RE Appraisals (quite busy lately with
foreclosures), and he tells me that recent purchase prices weigh heavily in
that calculation. A rising market leads to rising appraisals, and that
makes perfect sense and does not suggest fraud.
What "suggests" fraud is the indictments, convictions and confessions.

Sheesh.
steve
2008-09-30 15:37:05 UTC
Permalink
Post by r***@comcast.net
Post by steve
I have a close friend who does RE Appraisals (quite busy lately with
foreclosures), and he tells me that recent purchase prices weigh heavily in
that calculation. A rising market leads to rising appraisals, and that
makes perfect sense and does not suggest fraud.
What "suggests" fraud is the indictments, convictions and confessions.
Two out of three, anyway. I have not heard of such convictions and
confessions, and I would expect rampant fraud to be big news...and it isnt.
I hear only vague suggestions and demagoguery.
--
"Those who are merciful to the cruel will be cruel to the merciful."
from the Talmud
r***@comcast.net
2008-09-30 15:50:42 UTC
Permalink
Post by steve
Post by r***@comcast.net
Post by steve
I have a close friend who does RE Appraisals (quite busy lately with
foreclosures), and he tells me that recent purchase prices weigh heavily in
that calculation. A rising market leads to rising appraisals, and that
makes perfect sense and does not suggest fraud.
What "suggests" fraud is the indictments, convictions and confessions.
Two out of three, anyway. I have not heard of such convictions and
confessions, and I would expect rampant fraud to be big news...and it isnt.
I hear only vague suggestions and demagoguery.
It takes time for the courts to enter. The leading edge of
convictions is emerging in 2008

http://www.dallasnews.com/sharedcontent/dws/bus/stories/012508dnbusappraiser.2742e87.html
Arlington real estate appraiser sentenced to 5 years for fraud

Scam cost Countrywide millions, U.S. attorney says

http://dallas.fbi.gov/dojpressrel/pressrel08/mortgagefraud012408.htm


http://seattletimes.nwsource.com/html/businesstechnology/2008194436_wamu220.html
WaMu loaned millions to California home flippers convicted in fraud
scheme

http://www.forbes.com/feeds/ap/2008/09/25/ap5469775.html

Brothers admit to million-dollar mortgage fraud

http://www.flippingfrenzy.com/

http://www.mortgagefraud.org/
john fernbach
2008-09-29 23:17:42 UTC
Permalink
Post by john fernbach
Well, no.  This isn't big government.  This is robber baron
Capitalism, pure and simple.  Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests.   So, what else is new?
I'm call myself a democratic socialist, and I partly agree with this
statement, but I think it's a little unfair.
It's not simply unfair, but false.  The problem is in the mixture of govt
guarantees (implicit in FNMA and explicit in FDIC) and regulatory pressure
to make insecure loans (Community Redevelopment Act, and various problematic
adjustments to same..pushed primarily by democrats, esp Bill Clinton), plus
the cheap money that the Bush admin started pumping into the economy after
9-11 (via the printing press and the fed res).  All this created competitive
pressure to make bad loans (no money down, unqualified buyers), which in
turn fueled a run up in the housing market.  
When the market dropped, the
insecure mortgages were worth nothing and anyone holding mortgage backed
securities was also in trouble.  This is a failure of a poisonous
combination of poorly structured regulation and aggressive monetarism.
 The market only responded to the perverse incentives created by that
combination.  Many saw it coming, but there was no political advantage in
acting responsibly.
From what I've read, there certainly were perverse incentives, and
there certainly was -- if not "aggressive" monetarism, then at least
irresponsible monetarism.

Ditto with "poorly structured regulation."

But this isn't the first big financial crisis to hit American
capitalism and/or world capitalism in recent years or recent decades.

In 1981 and early 1982, the US government under Ronald Reagan's
leadership engaged in an emergency effect to prevent Mexico from
defaulting on its foreign loans, because at least some of the supposed
wise men in the financial markets were arguing that a default by a
sovereign country the size of Mexico could destabilize the entire
world financial system.

And the big Western banks were saved from collapse over the next
several years, largely thanks to the arm-twisting of the Third World
debtors that US Treasury Secretary James Baker orchestrated.

But all hell broke loose economically in Latin America, sub-Saharan
Africa and parts of Asia and Eastern Europe that were caught up in the
debt crisis, and some of those countries haven't fully recovered from
it yet.

In the late 1980s, following the US government's deregulation of the
Savings and Loan industry, there then was another huge financial
crisis involving excessive real estate speculation (Sound familiar?)
and bad loans held by ambitious, overly speculative S&L operators
around the country. (Again - doesn't this sound familiar?)

Eventually the US government stepped in to bailout out the Savings and
Loan industry, shutting down a good number of the weaker thrift
institutions and folding their real estate assets into the Resolution
Trust Corporation -- the RTC. About 700-odd savings institutions
disappeared as a result of the crisis, and the American taxpayer
shelled out about $120 billion to clean up the mess.

All of this happened BEFORE Greenspan, and BEFORE Clinton, and BEFORE
the passage of the Community Reinvestment Act.

And now pretty much the same thing, or something very similar, is
happening again, but on a much more gigantic scale?

Did "over-regulation" cause all of these different financial crises?
I don't think so.>
steve
2008-09-30 13:51:03 UTC
Permalink
Post by john fernbach
From what I've read, there certainly were perverse incentives, and
there certainly was -- if not "aggressive" monetarism, then at least
irresponsible monetarism.
Ditto with "poorly structured regulation."
But this isn't the first big financial crisis to hit American
capitalism and/or world capitalism in recent years or recent decades.
This isnt a crisis of capitalism, it's a crisis on interventionists
economics. Govt created the conditions for this problem to develop, and
that is not capitalism.
Post by john fernbach
In 1981 and early 1982, the US government under Ronald Reagan's
leadership engaged in an emergency effect to prevent Mexico from
defaulting on its foreign loans, because at least some of the supposed
wise men in the financial markets were arguing that a default by a
sovereign country the size of Mexico could destabilize the entire
world financial system.
Irresponsible govt (Mexico and the US, in this case) is obviously not
capitalism.
Post by john fernbach
In the late 1980s, following the US government's deregulation of the
Savings and Loan industry, there then was another huge financial
crisis involving excessive real estate speculation (Sound familiar?)
and bad loans held by ambitious, overly speculative S&L operators
around the country. (Again - doesn't this sound familiar?)
Again, a problem of "deregulation" without removing govt gurantees. Quite
similar to the current problem, and, in fact, part of the current problem in
establishing that the govt would support irresponsible behavior. You are
missing the lesson, here.
Post by john fernbach
All of this happened BEFORE Greenspan, and BEFORE Clinton, and BEFORE
the passage of the Community Reinvestment Act.
And it was a much smaller problem because of the absence of CRA etc.
Post by john fernbach
Did "over-regulation" cause all of these different financial crises?
I don't think so.>
Well, the term "over-regulation" is problematic. It isnt that there were
too many or too few regulations, the problem is that any guarantee must have
corresponding and complimentary regulation to avoid causing a situation of
moral hazard (perverse incentives). The best regulation is none, and that
must include an absence of govt guarantees.

steve
--
"Those who are merciful to the cruel will be cruel to the merciful."
from the Talmud
Voltronicus
2008-09-30 13:58:00 UTC
Permalink
Post by steve
The best regulation is none, and that
must include an absence of govt guarantees.
Anarchy?
steve
2008-09-30 13:59:33 UTC
Permalink
Post by Voltronicus
Post by steve
The best regulation is none, and that
must include an absence of govt guarantees.
Anarchy?
No. Liberty.
--
"Those who are merciful to the cruel will be cruel to the merciful."
from the Talmud
RU12?
2008-09-30 14:01:31 UTC
Permalink
Post by steve
Post by Voltronicus
Post by steve
The best regulation is none, and that
must include an absence of govt guarantees.
Anarchy?
No. Liberty.
Liberty to those born with wealth, slavery to everyone else
--
July 7, 2004
Congress's Risky Zero Down Payment Plan Will Undermine FHA's Soundness
and Discourage Self-Reliance
by Ronald D. Utt, Ph.D.
WebMemo #529

The Zero Down Payment Act of 2004, introduced by Rep. Pat Tiberi
(R-OH), would require the Federal Housing Administration (FHA) to
offer federally insured mortgage loans to certain eligible households
to buy a house without a down payment.
r***@comcast.net
2008-09-30 15:21:22 UTC
Permalink
Post by steve
Post by Voltronicus
Post by steve
The best regulation is none, and that
must include an absence of govt guarantees.
Anarchy?
No. Liberty.
You're good at slogans. Not thinking.

Libertoon nonsense strikes again.
r***@comcast.net
2008-09-30 15:20:49 UTC
Permalink
On Tue, 30 Sep 2008 06:58:00 -0700 (PDT), Voltronicus
Post by Voltronicus
Post by steve
The best regulation is none, and that
must include an absence of govt guarantees.
Anarchy?
Hi sis the stupidity of absolutes.

Of course business can't run without government regulation. Government
provides the courts, the currency, and trading place and the essential
referee. Even roller derby has rules.
f***@msn.com
2008-09-30 14:05:01 UTC
Permalink
Well, the term "over-regulation" is problematic.  It isnt that there were
too many or too few regulations, the problem is that any guarantee must have
corresponding and complimentary regulation to avoid causing a situation of
moral hazard (perverse incentives).  The best regulation is none, and that
must include an absence of govt guarantees.
Yes, the guarantees without the regulation and oversight are the
problem.
The reason it's called "government" is because it, well, governs.
We've
had a system where the weak were somewhat protected from the strong
but the government has been turned on its head and now protects the
strong from the masses of the weak. It's an unstable situation since
there
is always asymetrical warfare. The bargain actually protected both
the
weak and the strong by regulating the interaction between them.
Destruction
is so much easier than construction. If the weak are left with
nothing they
will destroy everything. The system is unstable and needs active
governance.
r***@comcast.net
2008-09-30 15:19:10 UTC
Permalink
Post by steve
This isnt a crisis of capitalism, it's a crisis on interventionists
economics. Govt created the conditions for this problem to develop, and
that is not capitalism.
Yeah damn that government for listening to business and getting the
regulations off the books to let those businesses be "more
competitive".

They should know better than to listen to them.
steve
2008-09-30 15:31:44 UTC
Permalink
Post by r***@comcast.net
Post by steve
This isnt a crisis of capitalism, it's a crisis on interventionists
economics. Govt created the conditions for this problem to develop, and
that is not capitalism.
Yeah damn that government for listening to business and getting the
regulations off the books to let those businesses be "more
competitive".
They should know better than to listen to them.
The ability of the private sector to enlist the power of govt attracts the
same sort of whores and scoundrels as does govt itself. Only in a free
market are businesses required to make an honest living. And, yes, damn the
govt for listening to anyone (in or out of business, regardless of
motivation) who asks or tells them to exert control. And damn the people
for ignorantly giving the govt that power over the market. It is of no
value, and subject only to abuse.

I think Ive said enough, here.

steve
--
"Those who are merciful to the cruel will be cruel to the merciful."
from the Talmud
Voltronicus
2008-09-30 15:38:13 UTC
Permalink
Post by steve
I think Ive said enough, here.
Enough to convince me you are an idiot, at any rate.
r***@comcast.net
2008-09-30 15:45:54 UTC
Permalink
Post by steve
Post by r***@comcast.net
Post by steve
This isnt a crisis of capitalism, it's a crisis on interventionists
economics. Govt created the conditions for this problem to develop, and
that is not capitalism.
Yeah damn that government for listening to business and getting the
regulations off the books to let those businesses be "more
competitive".
They should know better than to listen to them.
The ability of the private sector to enlist the power of govt attracts the
same sort of whores and scoundrels as does govt itself. Only in a free
market are businesses required to make an honest living.
There is no free market and cannot be. WHy you idiots don't understand
that amazes me. Courts are needed to enforce contracts. Rules are
needed for the market place to function. Even roller derby has rules.

You binary all or none idiots can't talk about degree of regulation.
Just on or off. It's frankly too stupid to argue with.
Post by steve
And, yes, damn the
govt for listening to anyone (in or out of business, regardless of
motivation) who asks or tells them to exert control. And damn the people
for ignorantly giving the govt that power over the market. It is of no
value, and subject only to abuse.
I think Ive said enough, here.
Of course enough to see how removed you are form the real world.
steve
2008-09-30 16:00:12 UTC
Permalink
Post by r***@comcast.net
Post by steve
The ability of the private sector to enlist the power of govt attracts the
same sort of whores and scoundrels as does govt itself. Only in a free
market are businesses required to make an honest living.
There is no free market and cannot be. WHy you idiots don't understand
that amazes me. Courts are needed to enforce contracts. Rules are
needed for the market place to function. Even roller derby has rules.
Apparently I havent said enough.

Enforcement of contract and property rights are part and parcel of a free
market. That is a legitimate govt role. Dictating what contracts can or
cannot be, or indemnification against loss, etc...these are NOT a legitimate
functions of govt and not part of a free market. But I suspect you resists
these obvious (and they are obvious) distinctions for reasons other than
misunderstanding.

Now I have to get back to earning a living. I'll leave you to educate
yourself from now on, if you so choose.

steve
--
"Those who are merciful to the cruel will be cruel to the merciful."
from the Talmud
r***@comcast.net
2008-09-30 16:35:52 UTC
Permalink
Post by steve
Post by r***@comcast.net
Post by steve
The ability of the private sector to enlist the power of govt attracts the
same sort of whores and scoundrels as does govt itself. Only in a free
market are businesses required to make an honest living.
There is no free market and cannot be. WHy you idiots don't understand
that amazes me. Courts are needed to enforce contracts. Rules are
needed for the market place to function. Even roller derby has rules.
Apparently I havent said enough.
Enforcement of contract and property rights are part and parcel of a free
market. That is a legitimate govt role. Dictating what contracts can or
cannot be, or indemnification against loss, etc...these are NOT a legitimate
functions of govt and not part of a free market.
Ah the simpleton logic just keeps flowing. Of course content of
contracts is regulated. Again the question is to what degree is good
policy. Stupid statements about absolutes only point out you don't
think about these things.

Society prohibits contracts for murder.

Society prohibits contracts for slavery, and indentured servitude.

Society prohibits usurious terms.

Society can regulate for full disclosure of defects to negate buyer
beware type frauds.

Markets depend on information and a level playing field. The referee
and the rules provide and work to guarantee that - and to punish those
who intentionally circumvent the rules.
r***@comcast.net
2008-09-30 16:36:49 UTC
Permalink
Post by steve
Now I have to get back to earning a living. I'll leave you to educate
yourself from now on, if you so choose.
Ah I love the smugness of ignorance.

Listen junior your naive absolutes only show you've not dealt much
with real world issues in these matters. Take a couple decades dealing
with contracts in the courts and get back to me.
death from above
2008-10-01 00:03:21 UTC
Permalink
Post by john fernbach
Well, no.  This isn't big government.  This is robber baron
Capitalism, pure and simple.  Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests.   So, what else is new?
I'm call myself a democratic socialist, and I partly agree with this
statement, but I think it's a little unfair.
It's not simply unfair, but false.  The problem is in the mixture of govt
guarantees (implicit in FNMA and explicit in FDIC) and regulatory pressure
to make insecure loans (Community Redevelopment Act, and various problematic
adjustments to same..pushed primarily by democrats, esp Bill Clinton), plus
the cheap money that the Bush admin started pumping into the economy after
9-11 (via the printing press and the fed res).  All this created competitive
pressure to make bad loans (no money down, unqualified buyers), which in
turn fueled a run up in the housing market.  When the market dropped, the
insecure mortgages were worth nothing and anyone holding mortgage backed
securities was also in trouble.  This is a failure of a poisonous
combination of poorly structured regulation and aggressive monetarism.  The
market only responded to the perverse incentives created by that
combination.  Many saw it coming, but there was no political advantage in
acting responsibly.
steve
--
To put in layman's language, if you give big home loans to lazy
negroes and if you allow clever jews to bundle those loans and sell
them all around the world, you end with the mothafuc*a that we be
seein' now. and who LET this happen? The weasely politicians who
depend on jewish money and negro votes.
r***@comcast.net
2008-10-01 00:16:46 UTC
Permalink
On Tue, 30 Sep 2008 17:03:21 -0700 (PDT), death from above
Post by death from above
To put in layman's language, if you give big home loans to lazy
negroes and if you allow clever jews to bundle those loans and sell
them all around the world, you end with the mothafuc*a that we be
seein' now. and who LET this happen? The weasely politicians who
depend on jewish money and negro votes.
Wow. DO your minders know you're lose again?
Voltronicus
2008-09-29 22:41:50 UTC
Permalink
Post by john fernbach
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
Well, no.  This isn't big government.  This is robber baron
Capitalism, pure and simple.  Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests.   So, what else is new?
I'm call myself a democratic socialist, and I partly agree with this
statement, but I think it's a little unfair.
Well I call myself a National Socialist but those pesky Nazis gave
that a bad name. But I believe in nationalism and socialism.
A limited form of capitalism works but large multinational
corporations are destroying our economy.
If I had to choose between unfettered capitalism and socialism, I'd
pick socialism every time.
john fernbach
2008-09-29 23:27:55 UTC
Permalink
Post by Voltronicus
Post by john fernbach
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
Well, no.  This isn't big government.  This is robber baron
Capitalism, pure and simple.  Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests.   So, what else is new?
I'm call myself a democratic socialist, and I partly agree with this
statement, but I think it's a little unfair.
Well I call myself a National Socialist but those pesky Nazis gave
that a bad name. But I believe in nationalism and socialism.
A limited form of capitalism works but large multinational
corporations are destroying our economy.
If I had to choose between unfettered capitalism and socialism, I'd
pick socialism every time.
I would never call myself a national socialist, for all the obvious
reasons.

And I"m not sure that even a limited form of capitalism will keep on
working in the long run; I think eventually environmental constraints
will make continued capitalist growth impossible, which will make
inflict permanent stagnation on whatever capitalism still exists at
that point.

I do think markets are human institutions that will probably be
required even in a "post-capitalist" society, whatever we call itl
Maybe that's what you mean by a "limited form of capitalism."

But yes - large multinational corporations are indeed destroying our
economy.

Not only that, but the accumulation of huge sums of money in the bank
accounts of individual rich people, and in the bank accounts of
capitalist institutions, is creating a "crisis of over-accumulation"
for capitalism.

Back when the economy seemed prosperous, just two years ago, there
were too many people in the American economy and the world economy who
had sizeable amounts of money to invest, and the total sums they had
to invest were too large, for Wall Street to find truly sound and
legitimate uses for it all.

There were not enough genuinely productive kinds of economic activity
that could absorb all that capital investment and earn big profits for
the investors. And so partly out of greed, but I think partly out of
desperation, the Wall Street investment banks and some of their
richest countries started investing big sums in pure financial
speculation.

The result has been that we've grown "bubble" after "bubble" in the
investment arena, and now the bubbles are popping. Which means a lot
of that surplus investment capital that went into speculation since
the early 1980s, and in fact since the mid 1970s, is likely to be
destroyed.

That's the way capitalism often works, at least when it's not very
carefully regulated.
Voltronicus
2008-09-29 23:36:47 UTC
Permalink
Post by john fernbach
I do think markets are human institutions that will probably be
required even in a "post-capitalist" society, whatever we call itl
Maybe that's what you mean by a "limited form of capitalism."
Farmer Brown grew potatoes, Farmer Brown got to sell his potatoes.
Farmer Brown spent his money in the community. No collectivist farm
system required.
Now MegaOmniAgra grows potatoes and sends all the profits overseas.
David Oberman
2009-01-02 23:26:51 UTC
Permalink
Post by Voltronicus
If I had to choose between unfettered capitalism and socialism, I'd
pick socialism every time.
As long as I can have the top job in the State, I'm all for it.






____
I admit that I do not feel toward freedom of the press that complete &
instantaneous love which one accords to things by their nature supremely good.
I love it more from considering the evils it prevents than on account of
the good it does.

-- Tocqueville

Jerry Kraus
2008-09-30 16:10:12 UTC
Permalink
Post by john fernbach
Post by death from above
http://buchanan.org/blog/2008/09/pjb-day-of-reckoning/
Well, no.  This isn't big government.  This is robber baron
Capitalism, pure and simple.  Incompetent, dishonest, rich, powerful
Capitalists ignoring reality and the common good to feather their own
nests.   So, what else is new?
I'm call myself a democratic socialist, and I partly agree with this
statement, but I think it's a little unfair.
What Marx thought about capitalism was that in the long run, it would
face a crisis of declining profit rates brought on by its own drive
for never-ending capital investment.  Capitalism's worst enemy in the
long run, he wisecracked, would turn out to be itself.
What this suggests to me is that whether they're "robber barons" or
not, the capitalists are trying hard to ride a rodeo horse that they
basically can't control -- that nobody can really control.
Yes, their greed and their habit of looking at reality through a very
narrow lens, one shaped by their endless pursuit of profits, do cause
many of the system's worst problems.
But whatever the cause, capitalism does genuinely create terrible
problems for at least many of the people who support it and profit
from it.
How do they try to solve the economic problems that their own system
has created. When he was 30 years old and full of spunk and looking at
the British capitalism he saw in existence in 1848, Marx wrote that
the modern political state is "nothing more than the executive
committee of the bourgeoisie."
And while I don't think we should take Marx's word for everything,
there's a grain of truth in this.  When the capitalist "free market"
gets into bad trouble, which it does every so often, the smartest
capitalists turn to "big government" or at least turn to "government"
to get the economy back on track and functioning again.
Does this government economic intervention that the leading
capitalists themselves call for -- does it necessarily produce the
best results for society?
I think the conservatives and the libertarians are right when they
insist that the answer is no -- that both the business lobbyists and
the government bureaucrats often use "the State" not to impose the
best solution on the market, but all too often to serve various
special interests.
--------------------------------------------------------------------------------------------
Post by john fernbach
But in any case, I don't think that "robber barons" and "Big
Government" are incompatible. Sometimes they support one another;
sometimes they don't. But if "Big Government" is involved in creating
or fixing a crisis, that doesn't mean big capitalist corporations and
big capitalist investors are not involved. It's not like they're oil
and water, never mixing.
Oh, sure. Particularly in the U.S., the government is thoroughly and
utterly corrupt. Government agencies soley exist to enrich their
employees, not to provide services. But this simply means that the
government itself is a kind of corporate, capitalist enterprise, not a
government. Governments exist to govern. The U.S. government exists
as a money making enterprise to enrich civil servants. That's why
U.S. social services, police, intelligence agencies etc. are so
totally incompetent. They're not trying to accomplish anything.
They're just trying to make money.

What we need, now, are fundamentally new technologies, to generate
wealth. Particularly, controlled nuclear fusion. But, the
professional scientific bureaucracy is so corrupt and incompetent it
has no interest in, and no capacity to, make real progress. They are
trained to do nothing but make money for their laboratories.
Bert Hyman
2008-09-30 15:24:22 UTC
Permalink
http://buchanan.org/blugh/2008/09/pjb-day-of-reckoning/
How does major government intervention and participation in the
economy equate to any kind of "capitalism"?

Simply adding the word "capitalism" to the name of a system does not
make it so.
--
Bert Hyman | St. Paul, MN | ***@iphouse.com
wull
2008-09-30 15:47:44 UTC
Permalink
Post by Bert Hyman
http://buchanan.org/blugh/2008/09/pjb-day-of-reckoning/
How does major government intervention and participation in the
economy equate to any kind of "capitalism"?
Simply adding the word "capitalism" to the name of a system does not
make it so.
What movie was Pat Buchanan in? I know I didn't see it.

Wull
Post by Bert Hyman
--
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