Rant - What's the point of a short term economic fix...

[AU_domer]

if, in the process, you have absolutely guaranteed the bankruptcy of your country? It's completely irrational.

Borrowing and printing money will not make an economy more productive. It will not make an economy more efficient. It will not increase our harvest of natural resources. It's f*cking insane.

This entire episode was initiated by the government perverting incentive structures through increases in the the money supply, real estate focused tax breaks,  and programs like the Community Reinvestment Act, Fannie Mae, and Freddie Mac. The government's response to their obvious f*ck-up is to pervert the incentive structures on a grander scale. To expand their perversion to previously untouched industries. They respond by expanding the number of occasions where they will choose winners and losers through political means (with coercively obtained resources), rather than through the market means (with cooperatively obtained resources).

Bureaucrats who seek primarily to repay political favors and run for reelection will increasingly control our economy, our destiny, and our lives.

What could possibly go wrong?

We can't forget the private actors. Individuals borrowed too much money on fake housing equity and blew it on consumption. Many of them are at their limit and they cannot manage the debt burden. The government solution is to do everything in their power to get people to resume the spending orgy. The government solution is to not only discourage savings by lowering interest rates, but to actually make public statements which discourage the very notion of saving.

Just think about that for one minute.

If your economic theory tells you that when times are bad you need borrow money and forsake savings, it's f*cking wrong. It's g*dd*mn common sense. It's like following a diet that prescribes eating 4 whole pizzas if you gain a pound.

What is good for the individual is good for the economy. And saving money is good for both. Will it make things tougher in the short term? Of course it will. But any long term prosperity has to be based upon a foundation of savings and investment. Investment builds capital, which is kind of f*cking important in a system based entirely upon the accumulation of it.

/Rant

[Shimmy]

He said in a speech that this is the #1 country in the world, and he needs us to help him change that.  So here we go.  Change.  I wonder what being the #10 country in the world is gonna feel like.

[The One Man Gang]

Q: "What's the point of a short term economic fix if, in the process, you have absolutely guaranteed the bankruptcy of your country?"

A: "R-e--e-l-e-c-t-i-o-n"

QOD: "No one ever went broke understimating the intelligence of the American people." - H. L. Menken

[NCVol]

I agree with most of the rant, but it's really just a culmination of decades worth of industrial policy.  We've exported our wealth building activities, had decades of anemic wage and income growth below the top percentiles and have supported increased consumption and therefore GDP growth with a set of policies across the economy that encouraged consumers (as well as businesses and governments) to go further and further into debt.  In 2006 Larry Kudlow echoed the establishment line that this was a Goldilocks economy - just right - when in fact it was a massive, unsustainable bubble.  The only thing that happened a year ago is the ponzi scheme collapsed, when new debt to pay off old debt became impossible to come by.

And certainly new debt is not the answer to a ponzi scheme based on debt, but I am waiting for the first actual proposal by a politician to address the underlying issues.  The only thing sillier than thinking spending will get us out of this is thinking more tax cuts on top of the lowest tax rates in generations is THE answer.  The solution at some level is a fundamental reworking of our trade and industrial policy to a regime that doesn't depend in foreign producers taking ever depreciated paper for their valuable goods and raw materials. 

I can't believe that in the middle of this economic crisis how pathetic the national discourse is.  There should be discussions at the highest level with some of the country's brightest minds about long term trajectories and how to sustain our economic power.  Instead, deep thinkers are relegated to the sidelines while we debate bullshiate like whether or not the hedge funds holding Chrysler's debt got cheated out of a few pennies, when what should be on top of the agenda is why in the hell the greatest nation on earth must depend on a ficking pissant firm like FIAT to bail out our car makers.  It's unbelievable THAT doesn't seem to matter. 

[plumbervol]

The question is not what is the point of a short term fix, the  question is how do you deal with folks suffering from the economic catastrophe?

Look at the results of the strain on local government from the downturn. Money flow is DOWN and all government is hurting.... How do you pay for water, infrastructure, schools, POLICE Fire protection with such an economic downturn?

[Just Win]

The question is not what is the point of a short term fix, the  question is how do you deal with folks suffering from the economic catastrophe?

Look at the results of the strain on local government from the downturn. Money flow is DOWN and all government is hurting.... How do you pay for water, infrastructure, schools, POLICE Fire protection with such an economic downturn?

i would much prefer to suffer than sell my nation's birthright to china

[Shimmy]

What's stupid about this is who the hell is suffering?  oh boy times is hard...times is hard.  The majority of people in America live better than people in most other countries, but boy, times is hard.  And of the ones who don't, the majority of them have it bad by choice, but times is hard.  The chicken little news media tells people the sky is falling and the idiot socialist liberals start freaking out.

Yep I see it everywhere I look.  Times in America sho' is hard.

[plumbervol]

Yes we do, the question becomes will you trade places with a displaced worker?

[NCVol]

What's stupid about this is who the hell is suffering?  oh boy times is hard...times is hard.  The majority of people in America live better than people in most other countries, but boy, times is hard.  And of the ones who don't, the majority of them have it bad by choice, but times is hard.  The chicken little news media tells people the sky is falling and the idiot socialist liberals start freaking out.

Yep I see it everywhere I look.  Times in America sho' is hard.

That's really a lame comment.  Astounding lack of awareness of what's happening in this economy. 

[Shimmy]

I am aware.  Times is hard.

[NCVol]

To be fair, there were only 2 million or so homes lost last year, a million the year before.  And only 6 million people have lost their jobs and other several million more have part time with no benefits but need full time.  Only 10% in Tennessee are unemployed, the most in decades, but hey, 90% have a job.  And only a few trillion has been lost on homes and retirement plans.

So it's not so bad, and it's almost over!  Thank goodness for that.  It will be better soon, what with...... something.... to drive our economy forward wages and jobs will be plentiful again in no time!   

So, yeah, all this whining and moaning is for frickin pansies. 

[LTC]

American workers...hated by the cult............