| Author | Message | ||
     Fahren |
Please correct me if I'm wrong here, but are you suggesting that the US should, as Iceland is doing, default on our debt? Iceland is standing up to the banks and not agreeing to eat whatever manure the banks want to shove down their throats, in terms of more lending to them so they can use the borrowed money to pay the interest on the first money, while pushing them to squeeze the hardest-hit sectors of society by imposing austerity measures that slash any safety net. Oh, and forcing the countries (Ireland, for example) to empty the coffers of their pension funds to pay the debt service. And if that is not enough, they can sell the country's gold reserves. Iceland says NO. This is basically just a simple act of attempting to get the banks to accept that they took risks when lending out money, and that sometimes there's a reward, sometimes...not. It's not about defaulting on a loan, although sometimes, loans just work out and default happens - part of the deal, the risk taken by the lenders (remember, that's why they justify charging interest). Since when did everyone start believing that banks are so entitled to profits, yet if things go south, they can ask others to cover their losses? And meanwhile, Buellkowski, take a look at the mass selling off of US Treasury's: China divesting, Russia, too, and Japan has stopped buying (thanks, Fukushima), and they will have to sell off some of their holdings as well, to finance the disaster relief and re-building. Who's buying American? | ||
| Sifo |
Court - its just basic economics - if the rich have all the money, and the rest have little to none, then no one can spend, even for the things we need, let alone want - no commie plot on that point - just a fact. The trick - which has been pulled off a few times as our economy reflects - is to have those rich re-invest their money back into America, instead of abroad. Thus putting money back into the pockets of the average American, where it can do our economy some good. EZ The problem is that the poor haven't earned any money. The amount of wealth in the world isn't a static amount. If the rich hadn't earned their wealth then the poor would still be poor. That's just how it is. I have never understood the focus on the wage disparity thing other than class envy. Bill Gates making his hundreds of millions hasn't kept me from earning wealth at all. In fact I did quite well largely because of his becoming rich. | ||
| Sifo |
Iceland says NO. This is basically just a simple act of attempting to get the banks to accept that they took risks when lending out money, and that sometimes there's a reward, sometimes...not. What you are describing is defaulting on their debt. You describe it correctly. It's not about defaulting on a loan, although sometimes, loans just work out and default happens - part of the deal, the risk taken by the lenders (remember, that's why they justify charging interest). Banks charge interest to make profit, not to cover defaulters (not entirely at least). Any idea who is going to be willing to loan money to Iceland in the future? NOBODY! They have screwed themselves. We are following in their footsteps. Not to say that other countries you've mentioned aren't screwed too. The root problem is out of control spending, not how you fail to pay your debts. | ||
| Cityxslicker |
They didnt read it, dont comprehend it, couldnt adequately fight their way out of a paper bag about it; and at the time of its passing 72-80% of the representated population was AGAINST it. (granted some of those thought it didnt go far enough !) So if they didnt read it Signed it without doing so Their Constituents didnt want it Why are the harbors not dark with box Tea? It is Taxation without Representation; and further the IRS is the one administrating the 'premiums' And built on that 'success' two weeks later they passed another 2500 page bill that they didnt read. ! and when the dollar goes, all that wealth you have in US currency ... means exactly diddly. 2016 is a nice round date for that, it puts them on stage for a new class revolution in 2017 a big anniversary for these nimrods. | ||
| Buellkowski |
Sifo, it looks like your 97% figure is a different ratio than what I posted, so your assertion that things are worse isn't quite true. If you take the total debt owed over all years ("gross debt", $14 trillion) divided by the current annual GDP of around $14 trillion, you might arrive at 97%. But my chart (from CIA World Fact Book data) is akin to your "Spending to GDP Ratio" figure of just under 50%. Again, my point is that if you are borrowing in any given year as much as you produce in that same year, you're farked. | ||
| Ezblast |
The problem is that the poor haven't earned any money. The amount of wealth in the world isn't a static amount. If the rich hadn't earned their wealth then the poor would still be poor. That's just how it is. I have never understood the focus on the wage disparity thing other than class envy. Bill Gates making his hundreds of millions hasn't kept me from earning wealth at all. In fact I did quite well largely because of his becoming rich. You have to have a job to earn, and MickeyD's is not going to do it - trading mfgr. jobs for lower paying service jobs helps no one. Wrong, the rich earn the wealth because we pay for their goods. It is not class envy, it is historical fact - if the rich where to invest more in America, then there would be more money to spend in America. The depressions happen in large part from this imbalance, and its time the government started getting real about its budgeting, and started figuring out how we can get big business to invest in its homeland instead of abroad - that's where we are loosing money hand over fist, that and the military. EZ | ||
| Fahren |
Tom, read these: http://www.yesmagazine.org/new-economy/iceland-bus ts-the-banksters http://www.thenewamerican.com/world-mainmenu-26/eu rope-mainmenu-35/6417-icelandic-president-vetoes-b ank-bailout (or any other of the huge number of articles about the issue) to understand Iceland's situation. It's not a default. It's standing up to a bankster shakedown. | ||
| Sifo |
Buellkowski, I can't be held responsible for others mislabeling their data. EZ, I agree about getting the rich to invest here in the US. We need a tax policy that promotes that. As for me being wrong about the rich earning their money, what do you think is happening when we pay for good that the produce? Blame the military? Really? That is one of the few things that our government is mandated to maintain by our constitution. | ||
| Fahren |
The wealthiest in the nation are not investing back into this country. What's worse, they are taking tax dollars (TARP) and stuffing their pockets, as well as investing in foreign banks. There has been no trickling down of TARP funds. All it has produced is a loud, sucking sound, as America's dollars are sucked out of the economy, and into the control of the "Too Big To Fail" banks. See: http://www.washingtonsblog.com/2010/11/its-not-gre at-recssion-its-great-bank.html As to Treasury notes, Buellkowski, there is a heck of a lot of selling going on. Russia is divesting fast and hard. So is China. Japan used to be the biggest buyer, now (thank you, Fukushima), they are not buying, and will no doubt soon start selling as well, to pay for their massive relief and rebuilding, and to re-start their own struggling economy. So who is buying those Treasury notes? Here is a good read on the current fantasy of "Growing ourselves out of debt." See: http://www.oftwominds.com/blogjune11/growth-fantas y6-11.html | ||
| Court |
>>>The wealthiest in the nation are not investing back into this country. In fact . . quite the opposite. My wife worked with 3 fellows, all billionaires. One of them . . . you know, one of those nasty wealthy folks who paid millions (literally) in taxes every year . . who invested in start up companies, created jobs, created lots of wealth in folks' 401(k) programs . . he had enough. Read up on Stanely Druckenmiller. Pay attention to the part about . . .
He said "no more". Almost a carbon copy of Atlas Shrugged. | ||
| Ezblast |
As for me being wrong about the rich earning their money, what do you think is happening when we pay for good that they produce? I'm not saying they didn't earn their money, no where do I say that. Blame the military? Really? That is one of the few things that our government is mandated to maintain by our constitution. It is not the military itself - though I'm sure there is some pork there - it is the constant usage for others who do not want or need our military - all these actions are horrendous losses of money, not to mention the loss of our fellow American. America needs to become less caring of or fellow nations - we lost billions, perhaps trillions in forgiving other countries their dept to us, we have consistently forked out billions, perhaps by now trillions to other nations to help with their needs, and that screws us. We need to be more insular, work on caring for our own, developing our own manufacturing - again, and try not to depend on other countries for anything - period. There is no way we as a nation have received even a percentage point in return for what given the world. It is time we stopped worrying about them and started worrying about ourselves - before another depression sets in. EZ | ||
| Ezblast |
Court - America doesn't want charity - we want good paying jobs and a future, not a job that asks - "You want fries with that?" - that means a solid education, and jobs to use that education. Lets bring back that dream that if you work hard, it will pay off. I see that flushed by people too easily accepting the status quo, and we suffer for it. EZ | ||
| Cityxslicker |
you want success in America ? Learn a second language - Spanish, Chinese. worse case you will be able to ask do you want fries with that in multiple dialects; I am betting you fair better though. Who loves capitalism ? Moscow Ru. Who doesnt? looking at past and current behavior; Washington D.C. | ||
| Sifo |
Fahren, I've been read up on the situation in Iceland. I still have lots of unanswered questions. At this point it's clear to me that the government took over assets of some banks and are responsible for insured deposits much like our FDIC bank insurance. Iceland is refusing to payout to foreign account holders though, largely from the UK. The UK has covered this liability at this point so Iceland is in debt to the UK and refusing to pay. That is defaulting on your debts. The saga continues with not giving bailouts to other banks in trouble. This seems to be where you are focusing. As more banks fail and are taken over by the government there will be more foreign debt taken on by the government. There are those that feel bank bail outs are the way to prevent this. I'm not necessarily one of them. I think a lot has to do with how they got into the current situation. Here in the US we got into banks failing because they were force into writing obviously risky mortgages by government regulation and Fannie/Freddie qualification rules. This is where the desire for a government bail out gets murky. In general principal I'm very much against it. In a case where government regulations were the principal cause of the bad debt I have a much harder time telling the business owners that they are just screwed for following the law. This is the problem with government intervening in the day to day decision making of a business. Who is responsible when that decision making causes an entire industry to be in crisis? I'm still on the fence about our bank bail outs. It really sickens me. At the same time it never would have happened without the ridiculous mortgage practices that they were forced to follow. As far as Iceland goes, I don't know what lead to a systemic failure of their banking system. You give the impression that it's the fault of the banks. I would accept that if we were talking about one or two banks failing. This seems to be systemic though. That generally points to other influences that forced them to operate under bad business practices. My guess would be government regulations are the common thread. I don't have that information on the situation in Iceland however. | ||
| Xl1200r |
EZ - everyone still believes that if you work hard it'll pay off. The problem is no one wants to work hard. | ||
| Fahren |
Agreed that the banks, the bailouts, the colossal failure is incredibly complicated. And painful. I see where you are coming from, Sifo, about government programs, but honestly, knowing what I know about banks, bankers, and investment bankers, I see no one there being "forced" by government strong-men to lend. I do see, however, clear evidence of massive fraud, and banks jumping on the opportunity to offer low-doc and no-doc loans, and even brokers fudging the numbers to get the loan underwritten so they can collect their fee. I see the messy overlap of deposit- and investment-banking, the ability to wrap up a bunch of manure in the form of bad loans and sell them to pension funds and other investors, then bet that those bad loans will fail - a "heads I win, tails you lose" proposition for the banks. I think one has to be careful about confusing government "allowing" practices and government "forcing" practices in lending. | ||
| Sifo |
Keep in mind that at least in the US we were hit with a crisis caused by mortgages. That's an area I was involved in. There are many anti-discrimination laws that force banks to allow mortgages that are very dicey. Those are laws that all mortgage companies have to follow. On top of that if you want to be able to sell the mortgages that you write to Fannie/Freddie so that you have capital for the next loan you are forced into their qualification rules. That lead to banks writing dicey loans for 105% of the value of the house. When banks were more free to do business as they saw fit it was typical to need 20% down plus closing costs and you would probably need assets in reserve to qualify. I don't think we are really that far apart on our views on this. You can look up the Community Reinvestment Act it you want to research much of what lead us to this point. The intentions may have been good, but the results have been disastrous. | ||
| Hootowl |
"I see no one there being "forced" by government strong-men to lend" There are plenty of examples, and you don't have to leave badweb to find them. This has been discussed to death already. | ||
| Fahren |
The intentions may have been good, but the results have been disastrous. You can say that again! Combine that with greedy human impulses, on the part of both bankers and homeowners and/or speculative investors, hoping to cash in on the bubble, and..... kaboom. Ugh. Nasty stuff. (Message edited by fahren on June 23, 2011) | ||
| Sifo |
Well, it was the easy financing that created the bubble. If they had made laws to only help the poor, the disastrous results could have been absorbed. The thing is that you can't solve "discriminatory" banking practices against the poor without allowing the same loosey goosey lending practices to the wealthy. All of a sudden we had people from all economic classes defaulting, and a single default on a $2 million home is far worse that a 10 defaults on $100K homes. When the bubble burst the guy with a $2 million home found that he could suddenly purchase a bigger home around the block $1.5 million, default on the $2 million note that he has little cash into anyway, and he gets a bigger house and a lower monthly payment. He can afford to deal with the hit to his credit rating (after all he just made half a million moving to a bigger house!) so it's no big deal. The guy on the other end of the spectrum just gets the shaft again and blames the bank that is swamped in foreclosures. Then the government made things even worse by forcing banks to consider mortgage restructuring with rules that had people not paying their mortgage for months. The problem was that they owed so much that there was no way for them to qualify for the restructure because of the deflated property value. Suddenly they are dropped from the restructure program and are expected to make the payments in arrears. That money typically has already been spent because they are uneducated in finance and believed the promises made by the government. This is where one of the government fixes created a whole new wave of defaults. | ||
| Mr_grumpy |
I heard an interesting thing on the radio in Switzerland the other day. The money from Greek citizens (mostly multi millionaires/billionaires) on deposit in Swiss banks (where it's basically sleeping, not earning) is more than 3 times what the IMF & the EU are lending Greece in emergency bailout loans. If that's the case for Greece, I'd imagine that the US's wealthiest could stand the country back on it's feet with little or no pain, & certainly no change to their lifestyle. So are they un-American for not doing so? They've got where they are through the "American way" should they not pay some back to help their nation & fellow citizens have their chances? It's a tricky philosophical dilemma, I have no answers, wherever you draw the line somebody will squeal. | ||
| Sifo |
So are they un-American for not doing so? They've got where they are through the "American way" should they not pay some back to help their nation & fellow citizens have their chances? It's a tricky philosophical dilemma, I have no answers, wherever you draw the line somebody will squeal. If you see a tricky philosophical dilemma then you really don't understand private property or personal responsibility. I also can't speak for the accuracy for what you heard on the radio. I do question how that data would even be compiled given the claimed secrecy of the Swiss banking system. | ||
| Slaughter |
I have stated this MANY times before - when Bill Gates was testifying before Con Gress and he was crucified for the "obscene" profits that Microsoft was making - I thought to myself - Mr Schumer, you do realize that the teat upon which you suck is attached directly to profits, don't you? What do you expect to tax, LOSSES? Gates was a smart guy, he could have run Microsoft profits to ZERO - and didn't. I'm not a fan of Microsoft - just find myself entertained by mathematically-challenged opinions. | ||
| Boogiman1981 |
lest we forget the other side of the mortgage issue. after following the rules that the gment put out there to try and 'help' the banks turned around and created all kinds of haywire schemes to repackage and resell this known bad debt back and forth. i'm no financial expert. that would at least to me seem like an unacceptable risk, at least to be the last one holding the bag when the light was shined on the whole damn thing. i also do not believe that it was 'just' mortgages or even the reselling of them that was the 'one' thing. there were and still are numerous issues we as a nation are dealing with that all contributed to this collapse. question is what do we do now to move on? there is a lot of discussion about sustainability going on right now. so as this thread was begun is there a peaceable way out? | ||
| Mr_grumpy |
I have no idea of the accuracy, as I said it's something I heard on the radio. On the contrary I do understand about personal responsibility & private property, I'm raised from Scots stock. The problem is that governments don't seem to. The philosophical dilemma is where do you draw the line. The Communist philosophy at one end of the scale & a "Grab what you can & hold on to it" philosophy at the other. Would you be helping your fellow man? or carrying a bunch of freeloaders? That's why it's a philosophical problem, there are as many answers as there are people with opinions. BTW the Swiss banking system is not as secure as you might think. However the Swiss Franc is rock hard which is great for me.  | ||
| Sifo |
The problem is that governments don't seem to. And that is the entire problem. I have no problem with helping your fellow man, which the wealthy in the US do plenty of in many ways. Look at it this way. If you worked for an employer who was constantly irresponsible, spending money in ridiculous ways that weren't connected with the business and runs the business into ruin. Would you then offer a large part of your salary too help "fix" the problem with no sign that the employer is ever going to change their ways? | ||
| Cityxslicker |
The free wheeling repackaging, rebundling, of toxic assets based on community size and the 'required intent' to repay debt (ie Toxic Asset ) is EXACTLY the derivative Reinsurance pools that the New Health Care Bill MANDATES to Health, Disability, and Short Term Medical Care. It goes live 2014 .... It falls dead in under 5. When you cant restrict, reject, or increase premium based on advanced risk presented; you will get disparate black practices to maximize profit, short repayment, and redirect reinvestment. The US Private Insurance health market is poised for collapse - exactly as they intend. It will be a wild ride for speculators; and in classic ponzi scheme, by the time it hits the news, the ride is over. Your first notion that it is happening, is when Big Players 'domicile' overseas out of CONUS. It has happened before, to the letter - this is what drove Washington state near bankruptcy with their 'required public option' in 96-98. Opt in now to EMR/EMH companies, "Health Accounting" Firms, Compliance Law houses, Pharmaceutical Research, Durable Medical; and plan an exit at the peak by 2016. Come find me if I am wrong, I will be overseas with a vodka watching it crash. (again) | ||
| Mtjm2 |
Sifo , Myself and 40 others did just that .Only we didnt know how bad off the employer was in debt , just contributed it all to a slow economy . Went to work one day and were told the company was out of bussiness .Lost 2 weeks pay and 23 hrs overtime . The sad fact is most americans dont know how bad it really is , or dont care . As long as they keep getting there check . Ronald Regen said , government isnt the answer its the problem . | ||
| Fahren |
Mtjm, Really sorry to hear that. it sounds as if you had a problem with a private, free-market capitalist, not with the government, though. | ||
| Mtjm2 |
AHHH , Fahren . Correct you are . the question still remains , whats the government gunna do with the US when it has exhousted all of its resorces ? File chapter 7 ? . ANYONE ? ANYONE ? . |
