# The Great Depression - why did it end?



## SpidermanTuba

I guess technically this is history, but its so relevant to now I thought it best here.


Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.

The real question now, is how do we fix it?

Let's look to history.


The Great Depression - for what reasons did it end?


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## Midnight Marauder

SpidermanTuba said:


> its so relevant to now


It really isn't. We haven't even reached the economic lows established in the late 70s, much less the 30s. But, I'll forget that and stay on topic.

Economic studies have indicated that just as the downturn was spread worldwide by the rigidities of the Gold Standard, it was suspending gold convertibility (or devaluing the currency in gold terms) that did most to make recovery possible. 

US recovery is generally agreed to have begun in the spring of 1933. There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and the sharp contraction of the 1937 recession that interrupted it). According to Christina Romer, the money supply growth caused by huge gold inflows was a crucial source of the recovery of the United States economy, and that fiscal policy and World War II were of little help.

Of course, it depends on who you ask.


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## Gunny

SpidermanTuba said:


> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?



A better question ... Why is something from the 1930s posted in Current Events?


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## Gunny

SpidermanTuba said:


> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?



WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.


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## SpidermanTuba

Midnight Marauder said:


> SpidermanTuba said:
> 
> 
> 
> its so relevant to now
> 
> 
> 
> It really isn't. We haven't even reached the economic lows established in the late 70s, much less the 30s. But, I'll forget that and stay on topic.
> 
> Economic studies have indicated that just as the downturn was spread worldwide by the rigidities of the Gold Standard, it was suspending gold convertibility (or devaluing the currency in gold terms) that did most to make recovery possible.
> 
> US recovery is generally agreed to have begun in the spring of 1933. There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and the sharp contraction of the 1937 recession that interrupted it). According to Christina Romer, the money supply growth caused by huge gold inflows was a crucial source of the recovery of the United States economy, and that fiscal policy and World War II were of little help.
> 
> Of course, it depends on who you ask.
Click to expand...

It seems an awful big coincidence though, that the recover really hit full swing with WW II, don't you think?


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## Midnight Marauder

Gunny said:


> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> A better question ... Why is something from the 1930s posted in Current Events?
Click to expand...

Because most of the brain-dead public at large has drank the kool-aid that today's economic situation is somehow analogous to the depression of the 30s. It's not.

It's the Goebbels factor: say it loud enough and long enough and gullible people will just accept it as fact.


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## SpidermanTuba

Gunny said:


> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
Click to expand...


Wasn't the employment of everyone 18-45 caused by a draft which was funded by massive government spending?


What if the government today said, everyone who is between 18 and 45, who doesn't have a job, can come work for the government, and that went on for 4 years? Would that help?

Seems like the New Deal wasn't big enough. They weren't prepared to employ EVERYBODY. WW II did employ all men in those ages - which must have been  at least 35% of the workforce. Since unemployment wasn't at 35% this meant immediate full employment for anyone who wanted work, women, older men, and those unfit for military service.


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## Midnight Marauder

SpidermanTuba said:


> Seems like the New Deal wasn't big enough


It was largely irrelevant, as was WW2. The gold standard caused the problem and getting rid of it solved the problem. FDR's policies actually extended the depression 7-8 years.


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## SpidermanTuba

Midnight Marauder said:


> Gunny said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> A better question ... Why is something from the 1930s posted in Current Events?
> 
> Click to expand...
> 
> Because most of the brain-dead public at large has drank the kool-aid that today's economic situation is somehow analogous to the depression of the 30s. It's not.
> 
> It's the Goebbels factor: say it loud enough and long enough and gullible people will just accept it as fact.
Click to expand...




How is it not? Wasn't one of the biggest contributors to the depression massive land speculation and bank failures? Didn't the nation experience a huge stock market failure, massive unemployment, and a sharp contraction in the GDP?

If you break your leg in a car accident, and then break the other one 10 years later tumbling down a flight of stairs - isn't the treatment for your leg going to be just about the same even though the causes are very different?


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## Midnight Marauder

SpidermanTuba said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> Gunny said:
> 
> 
> 
> A better question ... Why is something from the 1930s posted in Current Events?
> 
> 
> 
> Because most of the brain-dead public at large has drank the kool-aid that today's economic situation is somehow analogous to the depression of the 30s. It's not.
> 
> It's the Goebbels factor: say it loud enough and long enough and gullible people will just accept it as fact.
> 
> Click to expand...
> 
> 
> 
> 
> How is it not? Wasn't one of the biggest contributors to the depression massive land speculation and bank failures? Didn't the nation experience a huge stock market failure, massive unemployment, and a sharp contraction in the GDP?
> 
> If you break your leg in a car accident, and then break the other one 10 years later tumbling down a flight of stairs - isn't the treatment for your leg going to be just about the same even though the causes are very different?
Click to expand...

Today's economic issues and those of the 30s are two totally separate things, with separate causes, and will have separate cures. And the US economy and the world's as well aren't anywhere near as bad as the 30s. Think back only to 1977, for an analogue of today.

To fix your analogy for you, the 30s was a broken spine, today is a hang nail.


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## Truthmatters

FDRs stimulus of the economy  worked. He pulled back briefly in 1937 and tried to balence the buget on the advice of the conservatives of the day and had to then reverse the action and go back to stimulus the next year. It was working to pull us out and then the war effort started and finished the job.

The end of WWII actually flooded the  job market with men needing a job, women went back home which helped tremendously with the job market. Some women had no choice but to continue to work.


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## Chris

Gunny said:


> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
Click to expand...


So government spending brought us out of the Great Depression.


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## Annie

SpidermanTuba said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> Gunny said:
> 
> 
> 
> A better question ... Why is something from the 1930s posted in Current Events?
> 
> 
> 
> Because most of the brain-dead public at large has drank the kool-aid that today's economic situation is somehow analogous to the depression of the 30s. It's not.
> 
> It's the Goebbels factor: say it loud enough and long enough and gullible people will just accept it as fact.
> 
> Click to expand...
> 
> 
> 
> 
> How is it not? Wasn't one of the biggest contributors to the depression massive land speculation and bank failures? Didn't the nation experience a huge stock market failure, massive unemployment, and a sharp contraction in the GDP?
> 
> If you break your leg in a car accident, and then break the other one 10 years later tumbling down a flight of stairs - isn't the treatment for your leg going to be just about the same even though the causes are very different?
Click to expand...


I'm not a doctor and don't play one on tv, but would think the answer would be no. Bone is 10 years older. Techniques change in addressing the breaks. Different type of break? Lots of factors.


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## Truthmatters

File:Gdp20-40.jpg - Wikipedia, the free encyclopedia

Look at this chart and you will see the new deals effects


This chart represents the facts.

Now tell me why did it start to improve and why did it fall back durring 1937?

can you answer?


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## Truthmatters

Chris said:


> Gunny said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
> 
> Click to expand...
> 
> 
> So government spending brought us out of the Great Depression.
Click to expand...




You Got It!


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## Truthmatters

that chart always ends the discussion.


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## Yukon

Adolph Hitler ended the Great Depression.


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## Kevin_Kennedy

The gold standard did not cause the Great Depression, the "gold standard" at the time was a bastardized gold standard at most and was nothing near "rigid."  The Federal Reserve caused the Great Depression, the same way it has caused our current recession.  Neither the New Deal nor World War 2 brought us out of the Depression either.  Of course unemployment went down with WW2, because so many were drafted to fight in the war.  The Great Depression did not end until _after_ WW2 when America once again began producing things people wanted or needed, and government controls over the economy lessened.


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## Midnight Marauder

Truthmatters said:


> FDRs stimulus of the economy  worked. He pulled back briefly in 1937 and tried to balence the buget on the advice of the conservatives of the day and had to then reverse the action and go back to stimulus the next year. It was working to pull us out and then the war effort started and finished the job.
> 
> The end of WWII actually flooded the  job market with men needing a job, women went back home which helped tremendously with the job market. Some women had no choice but to continue to work.


Complete baloney. But it is the basic parroted partisan view. So, nice job.

FDR replaces JFK as the far-left guidon bearer?


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## Truthmatters

The one who is spouting partisan hackery is you.

FDRs actions during the great depression was credited by the people who lived it as well as the vast majority of historians for pulling us out of the great depression.

You are trying to rewrite history and you have failed.


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## Truthmatters

Truthmatters said:


> File:Gdp20-40.jpg - Wikipedia, the free encyclopedia
> 
> Look at this chart and you will see the new deals effects
> 
> 
> This chart represents the facts.
> 
> Now tell me why did it start to improve and why did it fall back durring 1937?
> 
> can you answer?




give it a try


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## Midnight Marauder

Kevin_Kennedy said:


> The gold standard did not cause the Great Depression, the "gold standard" at the time was a bastardized gold standard...


Great Britain's obstinate return to pre-WW1 gold standard is generally considered, in non-partisan economist circles, as the catalyst for the Great Depression. There is no rational comparison between the 30s economic downturn and today's, only dishonest ones.


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## Midnight Marauder

Truthmatters said:


> The one who is spouting partisan hackery is you.
> 
> FDRs actions during the great depression was credited by the people who lived it as well as the vast majority of historians for pulling us out of the great depression.
> 
> You are trying to rewrite history and you have failed.


FDR was an outstanding con man. Even The Obama knows this. He said so himself: "What you see in FDR that I hope my team can emulate is, not always getting it right, but projecting a sense of confidence." That's what FDR did, projected a sense of confidence. While he was screwing up royally and making the depression worse, the folks loved him. "Projecting a sense of confidence" is what all con men do, that's why they're called that.


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## editec

SpidermanTuba said:


> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?


 
Jusdging from the stock market it ended about 1955.

That is, (I think couldn't been 56 or something), the year that the market finally achieved it's 1929 high value.

Why did it end?

Because America was in the catbird seat (Europe and Asia were still recovering) and because of things like the GI bill which gave returning vets education AND housing.

So we had the majority of the earth's intact industry, we could sell products to everyone on earth, the rich were being soaked at 90% to pay for the war debts, too; there was HUGE unrealized demand for consumer goods and a lot of people had tucked away enough money (in the form of war bonds) so they could start spending again.

Basically, the CONSUMING CLASS had a high percentage of the liquid capital, which cause demand thus making suppliers very happy.

It was the *victuous cycle* of a capitalistic economy.


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## Kevin_Kennedy

Midnight Marauder said:


> Kevin_Kennedy said:
> 
> 
> 
> The gold standard did not cause the Great Depression, the "gold standard" at the time was a bastardized gold standard...
> 
> 
> 
> Great Britain's obstinate return to pre-WW1 gold standard is generally considered, in non-partisan economist circles, as the catalyst for the Great Depression. There is no rational comparison between the 30s economic downturn and today's, only dishonest ones.
Click to expand...


I didn't say there was a rational comparison between todays recession and the Great Depression, I said that the Fed caused both.  Great Britain's return to the "gold standard" didn't work because they didn't deflate their money supply, and they overvalued their money supply.

What Has Government Done to Our Money? The Gold Exchange Standard (Britain and the U.S.) 1926-1931


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## Midnight Marauder

Kevin_Kennedy said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> The gold standard did not cause the Great Depression, the "gold standard" at the time was a bastardized gold standard...
> 
> 
> 
> Great Britain's obstinate return to pre-WW1 gold standard is generally considered, in non-partisan economist circles, as the catalyst for the Great Depression. There is no rational comparison between the 30s economic downturn and today's, only dishonest ones.
> 
> Click to expand...
> 
> 
> I didn't say there was a rational comparison between todays recession and the Great Depression, I said that the Fed caused both.  Great Britain's return to the "gold standard" didn't work because they didn't deflate their money supply, and they overvalued their money supply.
> 
> What Has Government Done to Our Money? The Gold Exchange Standard (Britain and the U.S.) 1926-1931
Click to expand...

It was the major catalyst for the depression. According to most economists. Historians however, disagree.


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## Kevin_Kennedy

Midnight Marauder said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Midnight Marauder said:
> 
> 
> 
> Great Britain's obstinate return to pre-WW1 gold standard is generally considered, in non-partisan economist circles, as the catalyst for the Great Depression. There is no rational comparison between the 30s economic downturn and today's, only dishonest ones.
> 
> 
> 
> 
> I didn't say there was a rational comparison between todays recession and the Great Depression, I said that the Fed caused both.  Great Britain's return to the "gold standard" didn't work because they didn't deflate their money supply, and they overvalued their money supply.
> 
> What Has Government Done to Our Money? The Gold Exchange Standard (Britain and the U.S.) 1926-1931
> 
> Click to expand...
> 
> It was the major catalyst for the depression. According to most economists. Historians however, disagree.
Click to expand...


That doesn't mean it was a genuine gold standard, as I said before it was no more than a bastardized gold standard.


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## Truthmatters

Midnight Marauder said:


> Truthmatters said:
> 
> 
> 
> The one who is spouting partisan hackery is you.
> 
> FDRs actions during the great depression was credited by the people who lived it as well as the vast majority of historians for pulling us out of the great depression.
> 
> You are trying to rewrite history and you have failed.
> 
> 
> 
> FDR was an outstanding con man. Even The Obama knows this. He said so himself: "What you see in FDR that I hope my team can emulate is, not always getting it right, but projecting a sense of confidence." That's what FDR did, projected a sense of confidence. While he was screwing up royally and making the depression worse, the folks loved him. "Projecting a sense of confidence" is what all con men do, that's why they're called that.
Click to expand...



Nothing but patisan blather.

No one is buying that crap but the right wing nut bags.


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## Midnight Marauder

Truthmatters said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> The one who is spouting partisan hackery is you.
> 
> FDRs actions during the great depression was credited by the people who lived it as well as the vast majority of historians for pulling us out of the great depression.
> 
> You are trying to rewrite history and you have failed.
> 
> 
> 
> FDR was an outstanding con man. Even The Obama knows this. He said so himself: "What you see in FDR that I hope my team can emulate is, not always getting it right, but projecting a sense of confidence." That's what FDR did, projected a sense of confidence. While he was screwing up royally and making the depression worse, the folks loved him. "Projecting a sense of confidence" is what all con men do, that's why they're called that.
> 
> Click to expand...
> 
> 
> 
> Nothing but patisan blather.
> 
> No one is buying that crap but the right wing nut bags.
Click to expand...

It's not partisan, it's just the terrible, inconvenient, unpalatable truth. The revisionist historians are the ones who now champion FDR because it suits their political agenda. Before this, trumpeting JFK suited a political agenda. See how neat that works? Dumbasses buy it almost every time! Dumbass dupes, or "marks" in the con man lexicon.


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## Said1

Doubling the reserve ratio caused the '37 recession.


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## Truthmatters

Midnight Marauder said:


> Truthmatters said:
> 
> 
> 
> 
> 
> Midnight Marauder said:
> 
> 
> 
> FDR was an outstanding con man. Even The Obama knows this. He said so himself: "What you see in FDR that I hope my team can emulate is, not always getting it right, but projecting a sense of confidence." That's what FDR did, projected a sense of confidence. While he was screwing up royally and making the depression worse, the folks loved him. "Projecting a sense of confidence" is what all con men do, that's why they're called that.
> 
> 
> 
> 
> 
> Nothing but patisan blather.
> 
> No one is buying that crap but the right wing nut bags.
> 
> Click to expand...
> 
> It's not partisan, it's just the terrible, inconvenient, unpalatable truth. The revisionist historians are the ones who now champion FDR because it suits their political agenda. Before this, trumpeting JFK suited a political agenda. See how neat that works? Dumbasses buy it almost every time! Dumbass dupes, or "marks" in the con man lexicon.
Click to expand...




and you chatter on and on.

The economists are split straight down teh middle on it and the people who lived it LOVED FDR as well as Historians who run about 3/4th for FDR.

You are claiming something as fact when it is partisan blather that he harmed the economy.

It is you who are revising history for your partisan view.


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## Truthmatters

Recession of 1937 - Wikipedia, the free encyclopedia

here you go said 1


 but many of the causes show that because the New Deal involved spending money from the Federal budget, President Roosevelt had to end New Deal spending, and thus programs, as a result.


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## Annie

> *After six years of infusing huge sums of federal money into the economy via the Works Progress Administration, the Tennessee Valley Authority and the Civilian Conservation Corps, among others, FDRs Secretary of the Treasury Henry Morgenthau had this to say:
> We have tried spending money, we are spending more than we have ever spent before and it does not work . . . We have never made good on our promises . . . I say after eight years of this Administration we have just as much unemployment as when we started . . . And an enormous debt to boot!*
> 
> That was May 1939.  The unemployment rate hovered around 20%.  Do we really want to repeat the same mistakes?



Is this what we want?


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## Truthmatters

Not going to pay attention to what I just posted?

He started with a 25% unemployment BTW.


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## Truthmatters

Truthmatters said:


> Recession of 1937 - Wikipedia, the free encyclopedia
> 
> here you go said 1
> 
> 
> but many of the causes show that because the New Deal involved spending money from the Federal budget, President Roosevelt had to end New Deal spending, and thus programs, as a result.





Background
By 1936, all the main economic indicators had regained the levels of the late 1920s, except for unemployment, which remained high, although it was considerably lower than the 25% unemployment rate seen in 1933. In 1937, the American economy took an unexpected downturn, lasting through most of 1938. Production declined sharply, as did profits and employment. Unemployment jumped from 14.3% in 1937 to 19.0% in 1938. In two months, unemployment rose from 5 million to over 9 million, reaching almost 12 million in early 1938. Manufacturing output fell off by 40% from the 1937 peak; it was back to 1934 levels. Producers reduced their expenditures on durable goods, and inventories declined, but personal income was only 15% lower than it had been at the peak in 1937. In most sectors hourly earnings continued to rise throughout the recession, which partly compensated for the reduction in the number of hours worked. As unemployment rose, consumers' expenditures declined, leading to further cutbacks in production.


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## Truthmatters

Now realize FDR was unable to keep the spending at the current levels for the year 1937.

Guess why the recovering economy faltered and the unemployment nearly doubled in two months?


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## DiveCon

Truthmatters said:


> Recession of 1937 - Wikipedia, the free encyclopedia
> 
> here you go said 1
> 
> 
> but many of the causes show that because the New Deal involved spending money from the Federal budget, President Roosevelt had to end New Deal spending, and thus programs, as a result.


you are totally cluelless
not only on this, but on just about everything


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## Gunny

Truthmatters said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> Nothing but patisan blather.
> 
> No one is buying that crap but the right wing nut bags.
> 
> 
> 
> It's not partisan, it's just the terrible, inconvenient, unpalatable truth. The revisionist historians are the ones who now champion FDR because it suits their political agenda. Before this, trumpeting JFK suited a political agenda. See how neat that works? Dumbasses buy it almost every time! Dumbass dupes, or "marks" in the con man lexicon.
> 
> Click to expand...
> 
> 
> 
> 
> and you chatter on and on.
> 
> The economists are split straight down teh middle on it and the people who lived it LOVED FDR as well as Historians who run about 3/4th for FDR.
> 
> You are claiming something as fact when it is partisan blather that he harmed the economy.
> 
> It is you who are revising history for your partisan view.
Click to expand...


Going to write your own version of history in this thread too?  Get over yourself, huh?  You're full of shit.


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## DiveCon

Gunny said:


> Truthmatters said:
> 
> 
> 
> 
> 
> Midnight Marauder said:
> 
> 
> 
> It's not partisan, it's just the terrible, inconvenient, unpalatable truth. The revisionist historians are the ones who now champion FDR because it suits their political agenda. Before this, trumpeting JFK suited a political agenda. See how neat that works? Dumbasses buy it almost every time! Dumbass dupes, or "marks" in the con man lexicon.
> 
> 
> 
> 
> 
> 
> and you chatter on and on.
> 
> The economists are split straight down teh middle on it and the people who lived it LOVED FDR as well as Historians who run about 3/4th for FDR.
> 
> You are claiming something as fact when it is partisan blather that he harmed the economy.
> 
> It is you who are revising history for your partisan view.
> 
> Click to expand...
> 
> 
> Going to write your own version of history in this thread too?  Get over yourself, huh?  You're full of shit.
Click to expand...

as she always is


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## Truthmatters

FDR was seen as a HERO by the people who LIVED the great depression.

They know more about it than you can ever dream of knowing.

The economists are split right down the middle on the subject, can you guess why?

Historians are on his side by about 3/4ths.

 I go with the people who lived it and the historians and half the economists.

whos on your side? half the economists and partisan hacks thats who.


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## DiveCon

Truthmatters said:


> FDR was seen as a HERO by the people who LIVED the great depression.
> 
> They know more about it than you can ever dream of knowing.
> 
> The economists are split right down the middle on the subject, can you guess why?
> 
> Historians are on his side by about 3/4ths.
> 
> I go with the people who lived it and the historians and half the economists.
> 
> whos on your side? half the economists and partisan hacks thats who.


no, he wasnt
not by all of them
stop drinking the koolaid for a change


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## Truthmatters

Will Bush or Economy Drive Midterm Elections?

20% disaproval rating is pretty damn small.


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## Gunny

Truthmatters said:


> FDR was seen as a HERO by the people who LIVED the great depression.
> 
> They know more about it than you can ever dream of knowing.
> 
> The economists are split right down the middle on the subject, can you guess why?
> 
> Historians are on his side by about 3/4ths.
> 
> I go with the people who lived it and the historians and half the economists.
> 
> whos on your side? half the economists and partisan hacks thats who.



Sure he was.  That's how it works when you control the microphone and claim everything good as your doing.

Don't tell me what I know, idiot.  Being raised by Depression Era grandparents and parents, I'd say a know a lot more about it than YOU do, so STFU.

Any historian YOU would believe is automatically no longer credible.

What FDR actually DID was create a legacy of failed government handout programs that have only survived through artificial respiration.  

WWII ended the Depression.  End of story.  There was an immediate end to any unemployment problem and the people back here could work all the hours they wanted and make all the money they wanted and the WORLD was buying from US.

Go pound sand, huh?


----------



## Gunny

DiveCon said:


> Truthmatters said:
> 
> 
> 
> FDR was seen as a HERO by the people who LIVED the great depression.
> 
> They know more about it than you can ever dream of knowing.
> 
> The economists are split right down the middle on the subject, can you guess why?
> 
> Historians are on his side by about 3/4ths.
> 
> I go with the people who lived it and the historians and half the economists.
> 
> whos on your side? half the economists and partisan hacks thats who.
> 
> 
> 
> no, he wasnt
> not by all of them
> *stop drinking the koolaid *for a change
Click to expand...


HEY!  I was gonna say that ...


----------



## Truthmatters

70 % approval from the people who were living the changes in the economy folks.

They saw it happening in their own lives.

Now you want to call that Greatest Generation who fought and won WWII a bunch of assholes because it fits your political view.

How wonderful of you.


----------



## Annie

Gunny said:


> Truthmatters said:
> 
> 
> 
> FDR was seen as a HERO by the people who LIVED the great depression.
> 
> They know more about it than you can ever dream of knowing.
> 
> The economists are split right down the middle on the subject, can you guess why?
> 
> Historians are on his side by about 3/4ths.
> 
> I go with the people who lived it and the historians and half the economists.
> 
> whos on your side? half the economists and partisan hacks thats who.
> 
> 
> 
> 
> Sure he was.  That's how it works when you control the microphone and claim everything good as your doing.
> 
> Don't tell me what I know, idiot.  Being raised by Depression Era grandparents and parents, I'd say a know a lot more about it than YOU do, so STFU.
> 
> Any historian YOU would believe is automatically no longer credible.
> 
> What FDR actually DID was create a legacy of failed government handout programs that have only survived through artificial respiration.
> 
> WWII ended the Depression.  End of story.  There was an immediate end to any unemployment problem and the people back here could work all the hours they wanted and make all the money they wanted and the WORLD was buying from US.
> 
> Go pound sand, huh?
Click to expand...


I was reading from the bottom up, knew it had to be Gunny!  I was thinking the same, my parents were 9 and 6 when 1929 hit. There families had little before, so there wasn't much change, just more relatives moving in with them. 

Both of them remember listening as a family to the 'fireside chats', their families supporting FDR, but heh, they were in the Chicago way back then. 

When talking about what they remembered, my folks said that it was weird being a younger teen, while the country was in turmoil, FDR seemed steady. Then came the war build up, my mom remember the court packing attempts, that's when FDR started losing some of his luster in her eyes. She said looking back, it was like the country was hypnotized. Things were not improving, but they kept reelecting 'Pa.'


----------



## Said1

Truthmatters said:


> Recession of 1937 - Wikipedia, the free encyclopedia
> 
> here you go said 1
> 
> 
> but many of the causes show that because the New Deal involved spending money from the Federal budget, President Roosevelt had to end New Deal spending, and thus programs, as a result.




Here you go, TM.  A non-wiki sight. 

Excess Reserves 1937-38

http://books.google.ca/books?id=pT8...O2vfkE&sa=X&oi=book_result&resnum=1&ct=result


----------



## Truthmatters

said 1, what you gave me is talking about 1940.

Also it is one book by two guys.


----------



## Said1

Truthmatters said:


> said 1, what you gave me is talking about 1940.
> 
> Also it is one book by two guys.



The link marked where I left off, here is the beginning.

http://books.google.ca/books?id=pT8...O2vfkE&sa=X&oi=book_result&resnum=1&ct=result

As to your second point, who cares. You refer to wiki.pedia


----------



## Truthmatters

and answer.com is where the wiki one is from.

I trust Wiki over two guys who wrote a book.


----------



## Said1

Truthmatters said:


> and answer.com is where the wiki one is from.
> 
> I trust Wiki over two guys who wrote a book.



Why? 

 And moreover, how do you know it contradicts what you claim?


----------



## manu1959

Truthmatters said:


> I trust Wiki over two guys who wrote a book.



i nominate this post for an award.................


----------



## Annie

manu1959 said:


> Truthmatters said:
> 
> 
> 
> I trust Wiki over two guys who wrote a book.
> 
> 
> 
> 
> i nominate this post for an award.................
Click to expand...


----------



## Truthmatters

thomas hall and J david ferguson

both two guys who teach economics.

It has already been established that the economists are split right down the middle on it.

It just means they are likely republicans.


----------



## Truthmatters

BTW those wow guys thomas hall and J david ferguson can edit wiki too righ?


----------



## Said1

Truthmatters said:


> thomas hall and J david ferguson
> 
> both two guys who teach economics.
> 
> It has already been established that the economists are split right down the middle on it.
> 
> It just means they are likely republicans.



So you found the link does not support your argument?


----------



## DiveCon

Truthmatters said:


> and answer.com is where the wiki one is from.
> 
> I trust Wiki over two guys who wrote a book.


so, you trust a site that can be and IS edited by ANYONE
LOL
more proof you are a fucking moron
not even the sites FOUNDER trusts it that much


----------



## Truthmatters

Wiki is right 999.9 of the time.

It is sometimes hacked and then corrected.

Those two proffs are 100% partisans.


----------



## Said1

Truthmatters said:


> Wiki is right 999.9 of the time.
> 
> It is sometimes hacked and then corrected.
> 
> Those two proffs are 100% partisans.



You didn't read the info contained in the link, so your opinion is invalid and worthless.


----------



## Truthmatters

I didnt read it all but I read enough to see them say stimulus didnt work.

That was enough when you have facts like this GDP During The Great Depression


----------



## Toro

Midnight Marauder said:


> To fix your analogy for you, the 30s was a broken spine, today is a hang nail.



A better analogy is that the 30s was a broken spine, today is a broken leg.

What is going on today is very, very serious, and threatens the viability of the global financial system.  That is not a hang nail.


----------



## DiveCon

Truthmatters said:


> Wiki is right 999.9 of the time.
> 
> It is sometimes hacked and then corrected.
> 
> Those two proffs are 100% partisans.


no, idiot, it isnt "hacked"
its clear you dont even know that that term means


----------



## Said1

Truthmatters said:


> I didnt read it all but I read enough to see them say stimulus didnt work.



So you read one sentence. I'm glad you didn't read more.  

That was enough when you have facts like this GDP During The Great Depression[/QUOTE]


Thanks. the link proves what everyone has said, except for you. Bravo.


----------



## Truthmatters

Year Unemployment rate 
1923-29............. 3.3 

1930............. 3.3 

1931............. 15.9

1932 ............. 23.6 

1933 ............ 24.9 

1934 ........... 21.7 

1935 .......... 20.1 

1936 .......... 17.0 

1937........... 14.3

1938........... 19.0 

1939 .......... 17.2

1940.......... 14.6

1941 ........... 9.9 

1942 ........... 4.7


----------



## Truthmatters

Said1 said:


> Truthmatters said:
> 
> 
> 
> I didnt read it all but I read enough to see them say stimulus didnt work.
> 
> 
> 
> 
> So you read one sentence. I'm glad you didn't read more.
> 
> That was enough when you have facts like this GDP During The Great Depression
Click to expand...






Again, I read enough to get their perspective didnt I?

We had already established that the economists are split right down the middle on the FDR policy, these two guys are economists.


----------



## Said1

Truthmatters said:


> Said1 said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> I didnt read it all but I read enough to see them say stimulus didnt work.
> 
> 
> 
> 
> So you read one sentence. I'm glad you didn't read more.
> 
> That was enough when you have facts like this GDP During The Great Depression
> 
> Click to expand...
> 
> 
> 
> Thanks. the link proves what everyone has said, except for you. Bravo.
Click to expand...



Again, I read enough to get their perspective didnt I?[/QUOTE]

Nope.


----------



## DiveCon

Truthmatters said:


> Year Unemployment rate
> 1923-29............. 3.3
> 
> 1930............. 3.3
> 
> 1931............. 15.9
> 
> 1932 ............. 23.6
> 
> 1933 ............ 24.9
> 
> 1934 ........... 21.7
> 
> 1935 .......... 20.1
> 
> 1936 .......... 17.0
> 
> 1937........... 14.3
> 
> 1938........... 19.0
> 
> 1939 .......... 17.2
> 
> 1940.......... 14.6
> 
> 1941 ........... 9.9
> 
> 1942 ........... 4.7


whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses


----------



## Truthmatters

the new Deal worked.

It got the ecnonly moving and effected unemployment numbers.

It kept people alive folks.


----------



## Truthmatters

just how fucking quickly did you expect me to read the fucking book?


----------



## Annie

DiveCon said:


> Truthmatters said:
> 
> 
> 
> Year Unemployment rate
> 1923-29............. 3.3
> 
> 1930............. 3.3
> 
> 1931............. 15.9
> 
> 1932 ............. 23.6
> 
> 1933 ............ 24.9
> 
> 1934 ........... 21.7
> 
> 1935 .......... 20.1
> 
> 1936 .......... 17.0
> 
> 1937........... 14.3
> 
> 1938........... 19.0
> 
> 1939 .......... 17.2
> 
> 1940.......... 14.6
> 
> 1941 ........... 9.9
> 
> 1942 ........... 4.7
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
Click to expand...


But, SHE DOESN'T GET IT!  FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!


----------



## Truthmatters

DiveCon said:


> Truthmatters said:
> 
> 
> 
> Year Unemployment rate
> 1923-29............. 3.3
> 
> 1930............. 3.3
> 
> 1931............. 15.9
> 
> 1932 ............. 23.6
> 
> 1933 ............ 24.9
> 
> 1934 ........... 21.7
> 
> 1935 .......... 20.1
> 
> 1936 .......... 17.0
> 
> 1937........... 14.3
> 
> 1938........... 19.0
> 
> 1939 .......... 17.2
> 
> 1940.......... 14.6
> 
> 1941 ........... 9.9
> 
> 1942 ........... 4.7
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
Click to expand...



in what way?


----------



## manu1959

Truthmatters said:


> the new Deal worked.
> 
> It got the ecnonly moving and effected unemployment numbers.
> 
> It kept people alive folks.



looks to me like the war fixed it.......


----------



## Said1

Truthmatters said:


> just how fucking quickly did you expect me to read the fucking book?


----------



## Truthmatters

Annie said:


> DiveCon said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> Year Unemployment rate
> 1923-29............. 3.3
> 
> 1930............. 3.3
> 
> 1931............. 15.9
> 
> 1932 ............. 23.6
> 
> 1933 ............ 24.9
> 
> 1934 ........... 21.7
> 
> 1935 .......... 20.1
> 
> 1936 .......... 17.0
> 
> 1937........... 14.3
> 
> 1938........... 19.0
> 
> 1939 .......... 17.2
> 
> 1940.......... 14.6
> 
> 1941 ........... 9.9
> 
> 1942 ........... 4.7
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
> 
> Click to expand...
> 
> 
> But, SHE DOESN'T GET IT!  FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!
Click to expand...




FDR took office in 1933.


----------



## DiveCon

Truthmatters said:


> DiveCon said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> Year Unemployment rate
> 1923-29............. 3.3
> 
> 1930............. 3.3
> 
> 1931............. 15.9
> 
> 1932 ............. 23.6
> 
> 1933 ............ 24.9
> 
> 1934 ........... 21.7
> 
> 1935 .......... 20.1
> 
> 1936 .......... 17.0
> 
> 1937........... 14.3
> 
> 1938........... 19.0
> 
> 1939 .......... 17.2
> 
> 1940.......... 14.6
> 
> 1941 ........... 9.9
> 
> 1942 ........... 4.7
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
> 
> Click to expand...
> 
> 
> 
> in what way?
Click to expand...

you really ARE a moron


----------



## Truthmatters

manu1959 said:


> Truthmatters said:
> 
> 
> 
> the new Deal worked.
> 
> It got the ecnonly moving and effected unemployment numbers.
> 
> It kept people alive folks.
> 
> 
> 
> 
> looks to me like the war fixed it.......
Click to expand...


Then why were we recovering before we entered the war in 1941?


----------



## Annie

Truthmatters said:


> Annie said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
> 
> 
> 
> 
> But, SHE DOESN'T GET IT!  FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!
> 
> Click to expand...
> 
> 
> 
> 
> FDR took office in 1933.
Click to expand...


No shit, genius. He was elected in '32 and just like now, the writing was on the wall. How far has the market fallen since 11/4/08? Unemployment numbers, you know those you are so fond of?


----------



## Truthmatters

DiveCon said:


> Truthmatters said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
> 
> 
> 
> 
> 
> in what way?
> 
> Click to expand...
> 
> you really ARE a moron
Click to expand...



You cant answer it can you?


----------



## Truthmatters

Annie said:


> Truthmatters said:
> 
> 
> 
> 
> 
> Annie said:
> 
> 
> 
> But, SHE DOESN'T GET IT!  FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!
> 
> 
> 
> 
> 
> 
> FDR took office in 1933.
> 
> Click to expand...
> 
> 
> No shit, genius. He was elected in '32 and just like now, the writing was on the wall. How far has the market fallen since 11/4/08? Unemployment numbers, you know those you are so fond of?
Click to expand...



Maybe you should look at the chart agian.

you fucked up your statement big time.


----------



## DiveCon

Truthmatters said:


> DiveCon said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> in what way?
> 
> 
> 
> you really ARE a moron
> 
> 
> Click to expand...
> 
> 
> 
> You cant answer it can you?
Click to expand...

why should i
you are such a moron you wouldnt understand it if i did


----------



## Truthmatters

Truthmatters said:


> Year Unemployment rate
> 1923-29............. 3.3
> 
> 1930............. 3.3
> 
> 1931............. 15.9
> 
> 1932 ............. 23.6
> 
> 1933 ............ 24.9 FDR takes office
> 
> 1934 ........... 21.7
> 
> 1935 .......... 20.1
> 
> 1936 .......... 17.0
> 
> 1937........... 14.3
> 
> 1938........... 19.0
> 
> 1939 .......... 17.2
> 
> 1940.......... 14.6
> 
> 1941 ........... 9.9
> 
> 1942 ........... 4.7



But, SHE DOESN'T GET IT! FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!



Now Annie it did NOT saor while he was in office did it?

FDR had to ahlt the stimulus in 1937 because of budgeting rules. The economy tanked and he had to reinstate the stimulus the next year. The eonomy began to recover once more and then WWII started which finished the job. BTW WWII spending was also government spending just like the stimulus.

Government spending ended the great depression by all peoples estimations, Hack jsut wont admitt it.


----------



## Toro

I think Said1's authors were at least partially correct.  Raising the reserve ratio is tightening, akin to raising interest rates.  Couple that with raising taxes and cutting spending and it is no surprise the economy fell off a cliff again.


----------



## DiveCon

Truthmatters said:


> manu1959 said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> the new Deal worked.
> 
> It got the ecnonly moving and effected unemployment numbers.
> 
> It kept people alive folks.
> 
> 
> 
> 
> looks to me like the war fixed it.......
> 
> Click to expand...
> 
> 
> Then why were we recovering before we entered the war in 1941?
Click to expand...

uh, we didnt really enter the war officially till 42, but do you not know what was going on in the lead up?
did you forget about the lend/lease project?


----------



## Truthmatters

Toro said:


> I think Said1's authors were at least partially correct.  Raising the reserve ratio is tightening, akin to raising interest rates.  Couple that with raising taxes and cutting spending and it is no surprise the economy fell off a cliff again.




The info she gave me attempted to say the stimulus was not working.

That I think was why she posted it.


----------



## mash107

Midnight Marauder said:


> SpidermanTuba said:
> 
> 
> 
> Seems like the New Deal wasn't big enough
> 
> 
> 
> It was largely irrelevant, as was WW2. The gold standard caused the problem and getting rid of it solved the problem. FDR's policies actually extended the depression 7-8 years.
Click to expand...


Nope. Failing to obey the gold standard following WWI and the booming 1920s is what precipitated into a leveraged up stock market that inevitably had to collapse, much similar to the NASDAQ crash. Do you honestly believe we followed the gold standard throughout the largest war seen in the history of mankind, up to that point?

Regardless, the insolvency of the banks are a natural phenomenon of fractional reserve banking. Unless the reserve ratio is 100%, the bank, by definition, is insolvent. This was the case during the GD, and that's why the banks failed, in the same exact way banks are failing now.


----------



## del

Truthmatters said:


> the new Deal worked.
> 
> It got the ecnonly moving and effected unemployment numbers.
> 
> It kept people alive folks.



try breathing into a paper bag.

 "ecnonly"?


----------



## Toro

Truthmatters said:


> Toro said:
> 
> 
> 
> I think Said1's authors were at least partially correct.  Raising the reserve ratio is tightening, akin to raising interest rates.  Couple that with raising taxes and cutting spending and it is no surprise the economy fell off a cliff again.
> 
> 
> 
> 
> 
> The info she gave me attempted to say the stimulus was not working.
> 
> That I think was why she posted it.
Click to expand...


I missed that inference.

What I do know is that most economists whom I have ever read on this subject attribute slashing spending and raising taxes was the cause of the 1937 recession, which is certainly consistent with economic theory as a tightening of fiscal policy would have slowed the economy.  However raising the reserve ratio would have also contributed to a slowdown given that is a tightening of monetary policy.

Tighten fiscal AND monetary policy when the economy was coming out of the Great  Depression and its no wonder the economy swooned again.

There is no way in hell they'd do that today.  In fact, they are doing the exact opposite as both monetary and fiscal policy are extremely loose, as they should be.


----------



## Chris

mash107 said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> Seems like the New Deal wasn't big enough
> 
> 
> 
> It was largely irrelevant, as was WW2. The gold standard caused the problem and getting rid of it solved the problem. FDR's policies actually extended the depression 7-8 years.
> 
> Click to expand...
> 
> 
> Nope. Failing to obey the gold standard following WWI and the booming 1920s is what precipitated into a leveraged up stock market that inevitably had to collapse, much similar to the NASDAQ crash. Do you honestly believe we followed the gold standard throughout the largest war seen in the history of mankind, up to that point?
> 
> Regardless, the insolvency of the banks are a natural phenomenon of fractional reserve banking. Unless the reserve ratio is 100%, the bank, by definition, is insolvent. This was the case during the GD, and that's why the banks failed, in the same exact way banks are failing now.
Click to expand...


No, that is not it exactly.

The banks failed because there was no FDIC. 

The stock market failed because of leveraged buying, the same thing that happened this time with the derivatives. 

The lack of regulation caused the collapse in 1929, and the problems we have now. 

The absence of government is anarchy.


----------



## Toro

mash107 said:


> Regardless, the insolvency of the banks are a natural phenomenon of fractional reserve banking. Unless the reserve ratio is 100%, the bank, by definition, is insolvent. This was the case during the GD, and that's why the banks failed, in the same exact way banks are failing now.



A reserve ratio of 100% is not by definition insolvency.  Insolvency is when the value of the liabilities is greater than the value of the assets of the bank, or if a bank (or any company) cannot meet its cash flow obligations when they are due.


----------



## DiveCon

Chris said:


> mash107 said:
> 
> 
> 
> 
> 
> Midnight Marauder said:
> 
> 
> 
> It was largely irrelevant, as was WW2. The gold standard caused the problem and getting rid of it solved the problem. FDR's policies actually extended the depression 7-8 years.
> 
> 
> 
> 
> Nope. Failing to obey the gold standard following WWI and the booming 1920s is what precipitated into a leveraged up stock market that inevitably had to collapse, much similar to the NASDAQ crash. Do you honestly believe we followed the gold standard throughout the largest war seen in the history of mankind, up to that point?
> 
> Regardless, the insolvency of the banks are a natural phenomenon of fractional reserve banking. Unless the reserve ratio is 100%, the bank, by definition, is insolvent. This was the case during the GD, and that's why the banks failed, in the same exact way banks are failing now.
> 
> Click to expand...
> 
> 
> No, that is not it exactly.
> 
> The banks failed because there was no FDIC.
> 
> The stock market failed because of leveraged buying, the same thing that happened this time with the derivatives.
> 
> The lack of regulation caused the collapse in 1929, and the problems we have now.
> 
> The absence of government is anarchy.
Click to expand...

wrong, the crash of 29 was because no one had faith that their money was safe in the banks
and the fact that you only had to have 10% to purchase stocks so when the drop happened, they could not meet the margin call


----------



## Truthmatters

Why Not the Gold Standard?


----------



## DiveCon

Toro said:


> mash107 said:
> 
> 
> 
> Regardless, the insolvency of the banks are a natural phenomenon of fractional reserve banking. Unless the reserve ratio is 100%, the bank, by definition, is insolvent. This was the case during the GD, and that's why the banks failed, in the same exact way banks are failing now.
> 
> 
> 
> 
> A reserve ratio of 100% is not by definition insolvency.  Insolvency is when the value of the liabilities is greater than the value of the assets of the bank, or if a bank (or any company) cannot meet its cash flow obligations when they are due.
Click to expand...

exactly


----------



## Toro

Truthmatters said:


> Why Not the Gold Standard?



I think the gold standard would be a disaster.

However, the current fiat system is also a disaster, but hey...


----------



## mash107

Chris said:


> mash107 said:
> 
> 
> 
> 
> 
> Midnight Marauder said:
> 
> 
> 
> It was largely irrelevant, as was WW2. The gold standard caused the problem and getting rid of it solved the problem. FDR's policies actually extended the depression 7-8 years.
> 
> 
> 
> 
> Nope. Failing to obey the gold standard following WWI and the booming 1920s is what precipitated into a leveraged up stock market that inevitably had to collapse, much similar to the NASDAQ crash. Do you honestly believe we followed the gold standard throughout the largest war seen in the history of mankind, up to that point?
> 
> Regardless, the insolvency of the banks are a natural phenomenon of fractional reserve banking. Unless the reserve ratio is 100%, the bank, by definition, is insolvent. This was the case during the GD, and that's why the banks failed, in the same exact way banks are failing now.
> 
> Click to expand...
> 
> 
> No, that is not it exactly.
> 
> The banks failed because there was no FDIC.
> 
> The stock market failed because of leveraged buying, the same thing that happened this time with the derivatives.
> 
> The lack of regulation caused the collapse in 1929, and the problems we have now.
> 
> The absence of government is anarchy.
Click to expand...


The complete control of government, as you advocate, in our affairs is called fascism. Our government should follow and abide by the Constitution which makes only gold and silver legal tender.

Do you honestly feel your money is safe with the head of the FDIC, Sheila Bear, saying that her agency will be insolvent sometime soon? I know that they have access to the printing press at the Fed, but when money is devalued to the point where $100,000 can't buy a loaf of bread, what good is the insurance?

Bloomberg.com: News


----------



## glockmail

SpidermanTuba said:


> ...
> 
> 
> The Great Depression - for what reasons did it end?


It ended because there was a market for our goods in Britain due to the war in Europe: ships, planes, vehicles, fuel, food.


----------



## Said1

Truthmatters said:


> Toro said:
> 
> 
> 
> I think Said1's authors were at least partially correct.  Raising the reserve ratio is tightening, akin to raising interest rates.  Couple that with raising taxes and cutting spending and it is no surprise the economy fell off a cliff again.
> 
> 
> 
> 
> 
> The info she gave me attempted to say the stimulus was not working.
> 
> That I think was why she posted it.
Click to expand...


You only read one sentence and, if you recall, I posted it to back up what I originally posted.


----------



## Said1

Toro said:


> Truthmatters said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> I think Said1's authors were at least partially correct.  Raising the reserve ratio is tightening, akin to raising interest rates.  Couple that with raising taxes and cutting spending and it is no surprise the economy fell off a cliff again.
> 
> 
> 
> 
> 
> The info she gave me attempted to say the stimulus was not working.
> 
> That I think was why she posted it.
> 
> Click to expand...
> 
> 
> I missed that inference.
> 
> What I do know is that most economists whom I have ever read on this subject attribute slashing spending and raising taxes was the cause of the 1937 recession, which is certainly consistent with economic theory as a tightening of fiscal policy would have slowed the economy.  However raising the reserve ratio would have also contributed to a slowdown given that is a tightening of monetary policy.
> 
> Tighten fiscal AND monetary policy when the economy was coming out of the Great  Depression and its no wonder the economy swooned again.
> 
> There is no way in hell they'd do that today.  In fact, they are doing the exact opposite as both monetary and fiscal policy are extremely loose, as they should be.
Click to expand...



I made no mention of FDR, just the reserve ratio. I think it was the biggest detriment at that time - 1937.


----------



## Truthmatters

"The new deal hindered recovery" is right in the second paragraph you sent me to.

I never said you said it, I said your link did and I thought that is why you posted it.


----------



## Said1

Truthmatters said:


> "The new deal hindered recovery" is right in the second paragraph you sent me to.
> 
> I never said you said it, I said your link did and I thought that is why you posted it.



Had you read a tad further, you would have noted that they write about placing all the blame on FDR as being unfair, in 1937. Instead, you chose to quibble about credibility. without reading further. Anyway, I'm not convinced you really understand the point I was trying to make since you continue to harp on something that has nothing to do with what i originally said.

Either way, Toro nailed it pretty good, no need to continue with you.


----------



## LiveUninhibited

Annie said:


> DiveCon said:
> 
> 
> 
> 
> 
> Truthmatters said:
> 
> 
> 
> Year Unemployment rate
> 1923-29............. 3.3
> 
> 1930............. 3.3
> 
> 1931............. 15.9
> 
> 1932 ............. 23.6
> 
> 1933 ............ 24.9
> 
> 1934 ........... 21.7
> 
> 1935 .......... 20.1
> 
> 1936 .......... 17.0
> 
> 1937........... 14.3
> 
> 1938........... 19.0
> 
> 1939 .......... 17.2
> 
> 1940.......... 14.6
> 
> 1941 ........... 9.9
> 
> 1942 ........... 4.7
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
> 
> Click to expand...
> 
> 
> But, SHE DOESN'T GET IT!  FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!
Click to expand...


That's not what I see in those stats. FDR took office at the peak of unemployment, in 1933, at almost 25%. Things improved from there, for whatever reason, until 1938, but unemployment did not become normal again until around 1942. Keep in mind that I am undecided on this issue.

So what country and in what era (doesn't have to be the 30s), handled a depression the best?


----------



## manu1959

LiveUninhibited said:


> Annie said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses
> 
> 
> 
> 
> But, SHE DOESN'T GET IT!  FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!
> 
> Click to expand...
> 
> 
> That's not what I see in those stats. FDR took office at the peak of unemployment, in 1933, at almost 25%. Things improved from there, for whatever reason, until 1938, but unemployment did not become normal again until around 1942. Keep in mind that I am undecided on this issue.
> 
> So what country and in what era (doesn't have to be the 30s), handled a depression the best?
Click to expand...


or you could read the stats as .....

as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....

sound familiar


----------



## manu1959

LiveUninhibited said:


> manu1959 said:
> 
> 
> 
> 
> 
> LiveUninhibited said:
> 
> 
> 
> That's not what I see in those stats. FDR took office at the peak of unemployment, in 1933, at almost 25%. Things improved from there, for whatever reason, until 1938, but unemployment did not become normal again until around 1942. Keep in mind that I am undecided on this issue.
> 
> So what country and in what era (doesn't have to be the 30s), handled a depression the best?
> 
> 
> 
> 
> or you could read the stats as .....
> 
> as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....
> 
> sound familiar
> 
> Click to expand...
> 
> 
> FDR was elected in late 1932. The stock market crashed in 1929. FDR's election does, in some ways, sound familiar though:
> 
> 
> 
> 
> Hoover's attempts to campaign in public were a disaster, as he often had objects (especially rotten fruit and vegetables) thrown at him or his vehicle as he rode through city streets. In his addresses, Hoover attacked Roosevelt as a dangerous radical who would only make the Depression worse by raising taxes and increasing the federal debt to pay for expensive welfare and social-relief programs. However, with unemployment at 23.6%,[1][2] Hoover's criticisms of the New Deal plan did nothing more than further lower his popularity with the public and it was said that "*Even a vaguely talented dog-catcher could have been elected president against the Republicans*..."
> 
> Click to expand...
> 
> United States presidential election, 1932 - Wikipedia, the free encyclopedia
Click to expand...


go read some of hoovers polices and tell me they don't sound like some of obama's...


----------



## Kevin_Kennedy

Truthmatters said:


> Why Not the Gold Standard?



The Case for Genuine Gold Dollar


----------



## LiveUninhibited

manu1959 said:


> go read some of hoovers polices and tell me they don't sound like some of obama's...



That's interesting since Hoover was a Republican. Which policies specifically would you point to that were problematic? 

I had also asked if anybody could point to where a depression was handled well in any country at any time. Is there none?


----------



## Kevin_Kennedy

LiveUninhibited said:


> manu1959 said:
> 
> 
> 
> go read some of hoovers polices and tell me they don't sound like some of obama's...
> 
> 
> 
> 
> I had also asked if anybody could point to where a depression was handled well in any country at any time. Is there none?
Click to expand...


1920 - 1921 in the United States.  There was a recession that was allowed to correct itself, and it only lasted for about a year.


----------



## LiveUninhibited

manu1959 said:


> or you could read the stats as .....
> 
> as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....
> 
> sound familiar



Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.


----------



## Kevin_Kennedy

LiveUninhibited said:


> manu1959 said:
> 
> 
> 
> or you could read the stats as .....
> 
> as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....
> 
> sound familiar
> 
> 
> 
> 
> Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.
Click to expand...


Going to war does not pull you out of a depression or a recession.  War is always destructive to the economy.


----------



## DiveCon

Kevin_Kennedy said:


> LiveUninhibited said:
> 
> 
> 
> 
> 
> manu1959 said:
> 
> 
> 
> or you could read the stats as .....
> 
> as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....
> 
> sound familiar
> 
> 
> 
> 
> Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.
> 
> Click to expand...
> 
> 
> Going to war does not pull you out of a depression or a recession.  War is always destructive to the economy.
Click to expand...

actually, it does
because the government spends money on an actual product
and not just throwing it down a money hole


----------



## LiveUninhibited

DiveCon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> LiveUninhibited said:
> 
> 
> 
> Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.
> 
> 
> 
> 
> Going to war does not pull you out of a depression or a recession.  War is always destructive to the economy.
> 
> Click to expand...
> 
> actually, it does
> because the government spends money on an actual product
> and not just throwing it down a money hole
Click to expand...


I suppose the struggle of war can, at great cost, yield new technologies originally meant for the battlefield that also help civilians afterwards. For example, medical technology often takes leaps forward during conflicts. 

I would agree that public money needs to be carefully spent on things that are useful instead of "throwing money down a hole." If a stimulus today were to help us get off of foreign oil while providing jobs, that would be a good use of public money it seems. Weatherizing buildings is quite literally a band-aid sort of approach. I'm disappointed there wasn't money for nuclear power.


----------



## DiveCon

LiveUninhibited said:


> DiveCon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Going to war does not pull you out of a depression or a recession.  War is always destructive to the economy.
> 
> 
> 
> actually, it does
> because the government spends money on an actual product
> and not just throwing it down a money hole
> 
> Click to expand...
> 
> 
> I suppose the struggle of war can, at great cost, yield new technologies originally meant for the battlefield that also help civilians afterwards. For example, medical technology often takes leaps forward during conflicts.
> 
> I would agree that public money needs to be carefully spent on things that are useful instead of "throwing money down a hole." If a stimulus today were to help us get off of foreign oil while providing jobs, that would be a good use of public money it seems. Weatherizing buildings is quite literally a band-aid sort of approach. I'm disappointed there wasn't money for nuclear power.
Click to expand...

exactly, which is why that porkulous bill wont do anything to fix the economy
its just throwing money down a hole
like how is studying pig shit gonna help the economy?


----------



## DiveCon

if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
also creates a profit for that business owner for which he pays taxes on
all those involved also pay taxes and spend that money creating yet more jobs


----------



## Kevin_Kennedy

DiveCon said:


> if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
> also creates a profit for that business owner for which he pays taxes on
> all those involved also pay taxes and spend that money creating yet more jobs



Frédéric Bastiat talked about what is seen, and what is unseen.  When the government spends money on a war you can see the tanks, the missiles, and everything else produced to fight that war.  But what remains unseen is what that money would have been spent on had there been no war, in other words what it was meant to be spent on.  How many jobs were destroyed because that money was spent on the war?  The same concepts apply to war spending as they do to any other government spending, because the government always has to take that money out of the private sector.  Thus hurting the economy.

"War prosperity is like the prosperity that an earthquake or a plague brings." - Ludwig von Mises


----------



## LiveUninhibited

DiveCon said:


> if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
> also creates a profit for that business owner for which he pays taxes on
> all those involved also pay taxes and spend that money creating yet more jobs



Jobs are certainly the number one concern. People need to be working to be able to participate in the economy constructively. However, whether their efforts go towards constructive ends is a not-so-distant second concern. When you're producing a tank to defend your country, that may be necessary, but not as ideal as producing a car that will transport a worker, or paving a freeway that will make travel safer and more efficient, or building a dam that will provide power instead of transferring more wealth to oil-producing nations.

Jobs can be created by the government or private entities. Conservatives often say that when liberal fiscal policies are implemented, private sources of jobs will dry up. While that is clearly possible, how do you differentiate between that and when consumers are simply refusing to spend money due to real or imagined threats to their economic viability?


----------



## garyd

Clown the CCC was found Unconstitutional by the Supreme Court in 1934 as was most of the rest of the 1st hundred Days legislation.  In 1937 with the replacement of two or three justices on SCOTUS. It was repassed as the WPA. And programs like that was the only reason unemployemnt post 1937. showed any decline at all prior to WWII. IE if you include those doing WPA Jobs with the unemployed unemployment did not fall at all. Until WWII when Roosevelt was compelled to pump money into the private sector rather than the Public the economy went Flat or dropped like a stone whenever the New Dealers got thier way and began to recover whenever they were prempted by SCOTUS in early 34 or by WWII in 1941.

The difference sir was in where the money was spent not the quantity of it. Obama and the Dems are making by and large the same mistakes Roosevelt did prior to 1939. He's putting way to much money into government and not enough into the private sector.

Kevin, Bastiat missed two things in that analysis.  1st The Great Depression was an almost unique event historically. Hence in this case there were no jobs destroyed in the US because of the War, and a good many were created by it. 2nd the chief accomplishment of WWII was that it changed the psychological balance of the country. We suddenly had something worse to worry about than how many people were out of work. I don't think it would have worked at any other time in History nor do I think that it would work now.


----------



## DiveCon

Kevin_Kennedy said:


> DiveCon said:
> 
> 
> 
> if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
> also creates a profit for that business owner for which he pays taxes on
> all those involved also pay taxes and spend that money creating yet more jobs
> 
> 
> 
> 
> Frédéric Bastiat talked about what is seen, and what is unseen.  When the government spends money on a war you can see the tanks, the missiles, and everything else produced to fight that war.  But what remains unseen is what that money would have been spent on had there been no war, in other words what it was meant to be spent on.  How many jobs were destroyed because that money was spent on the war?  The same concepts apply to war spending as they do to any other government spending, because the government always has to take that money out of the private sector.  Thus hurting the economy.
> 
> "War prosperity is like the prosperity that an earthquake or a plague brings." - Ludwig von Mises
Click to expand...

hey, its better than studying pig shit


----------



## Old Rocks

DiveCon said:


> if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
> also creates a profit for that business owner for which he pays taxes on
> all those involved also pay taxes and spend that money creating yet more jobs



That is fucking stupid. If you buy a tank, you have a product that is only good for destruction, and will be obsolete and useful only as scrap iron in about 10 years. If you build a bridge where needed, you have created infrastructure that will last at least two generations, possibly five, and will enhance the economy of the region for that period.

If you build a new energy grid, you will create a process that will build on itself. And it will be constructive, not destructive.


----------



## Old Rocks

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete pavement. We pay for a single fighter plane with a half million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people. This is, I repeat, the best way of life to be found on the road the world has been taking. This is not a way of life at all, in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron. ... Is there no other way the world may live?


----------



## glockmail

Old Rocks said:


> Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. ...


 This is an obvious admission that you don't have a clue about basic economics, a basic liberal trait.


----------



## Yukon

As I stated earlier it was Adolph Hitler who ended the Great Depression by attacking Poland.


----------



## editec

The relatively feeble stimulus spending before WWII had some positive effects on the economy, but more importantly it helped a lot of American PEOPLE weather that economic storm.

But the massive spending of WWII was the stimulant which _really_ got things going. And that was pretty much all done by taking on DEBT.

In both cases, notice the government is spending the money and notice that the nation was borrowing it, then, too.

When there is a shortage of money in circulation, when consumers and businesses have lost confidence, money needs to be injected into the system.

If it is not, then the *vicious cycle of DEflation* continues unabated: people don't spend because they fear for their jobs, businesses lay off people, because people aren't spending, the umeployed cannot spend, those with money see that the economy is still fibrilating, and they hoarde their dough...

Right now we're still in that vicious cycle of money being hoarded and not circulating.

People are not buying stuff because they are fearful.

Getting some people working again (those people who WILL spend their money because they have no choice) will prime the pump of the economy.

Inflation (or higher taxes to pay off the debts) is the likely outcome that will happen (as happened post WWII) once the economy has recovered.


----------



## Kevin_Kennedy

garyd said:


> Kevin, Bastiat missed two things in that analysis.  1st The Great Depression was an almost unique event historically. Hence in this case there were no jobs destroyed in the US because of the War, and a good many were created by it. 2nd the chief accomplishment of WWII was that it changed the psychological balance of the country. We suddenly had something worse to worry about than how many people were out of work. I don't think it would have worked at any other time in History nor do I think that it would work now.



Bastiat died in 1850.  So he didn't miss the Great Depression, it simply hadn't happened yet.  The Great Depression wasn't so unique that it trumps economics.  The government taking money out of the private sector to finance it's wars always hurts the private sector, regardless of whether the economy is in a recession or not.


----------



## midcan5

The great depression ended a year or two after FDR was elected according to any chronological history you survey. The effects lasted for many years after that and the war finally brought people and business together in a Keynesian frenzy of work and spending. While OT that togetherness stayed put till Reagan began the decline of America with his destruction of the middle class worker and his war deficits. 

Timeline of the Great Depression
The Great Depression, to 1935
Summary
The Main Causes of the Great Depression
Stiff upper lip.

[ame=http://www.amazon.com/Great-Depression-New-Deal-Introductions/dp/0195326342/ref=sr_1_8?ie=UTF8&qid=1230302046&sr=1-8]Amazon.com: The Great Depression and the New Deal: A Very Short Introduction (Very Short Introductions): Eric Rauchway: Books[/ame]


----------



## DiveCon

Old Rocks said:


> DiveCon said:
> 
> 
> 
> if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
> also creates a profit for that business owner for which he pays taxes on
> all those involved also pay taxes and spend that money creating yet more jobs
> 
> 
> 
> 
> That is fucking stupid. If you buy a tank, you have a product that is only good for destruction, and will be obsolete and useful only as scrap iron in about 10 years. If you build a bridge where needed, you have created infrastructure that will last at least two generations, possibly five, and will enhance the economy of the region for that period.
> 
> If you build a new energy grid, you will create a process that will build on itself. And it will be constructive, not destructive.
Click to expand...

building a new energy grid should be done by the power companies
since it would be them that would profit from it
not tax dollars
building a bridge would bennefit all drivers
and should be paid for from the gas tax that is supposed to be for roads and bridges
so you fail at both points


----------



## Yukon

I think it's time you people got your heads out out of the sand. The USA is now a socialist haven. The government technically owns all the banks, the big three auto companies, the energy companies, the military, the airlines - EVERYTHING of value in your country is owned by the Government yet you still cling to your feable minded belief that Medicare is socialism. Good God but you are so silly.......


----------



## Bern80

Midnight Marauder said:


> SpidermanTuba said:
> 
> 
> 
> Seems like the New Deal wasn't big enough
> 
> 
> 
> It was largely irrelevant, as was WW2. The gold standard caused the problem and getting rid of it solved the problem. FDR's policies actually extended the depression 7-8 years.
Click to expand...


This is an honest question so don't read anything into it.  Aren't an awful lot of people complaining that part of the problem now is that there isn't anything backing our currency (i.e. gold).


----------



## Bern80

Truthmatters said:


> that chart always ends the discussion.



No it doesn't, this is just another in a long line of non-correlaries that get presented by the likes of yourself.  Two things happening at the same time does not mean that one caused the other.


----------



## Kevin_Kennedy

Bern80 said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> Seems like the New Deal wasn't big enough
> 
> 
> 
> It was largely irrelevant, as was WW2. The gold standard caused the problem and getting rid of it solved the problem. FDR's policies actually extended the depression 7-8 years.
> 
> Click to expand...
> 
> 
> This is an honest question so don't read anything into it.  Aren't an awful lot of people complaining that part of the problem now is that there isn't anything backing our currency (i.e. gold).
Click to expand...


I don't know if you wanted MidnightMarauder to answer specifically, but if we had a real gold standard it would stop the Fed from inflating the money supply and tampering with the interest rates.  Both of which were probably among the main causes of our current crisis.


----------



## Yukon

Nixon removed the USA from the gold standard in 1971 to fuel his illegal Vietnam war.


----------



## Kevin_Kennedy

Yukon said:


> Nixon removed the USA from the gold standard in 1971 to fuel his illegal Vietnam war.



We were off the gold standard long before this.


----------



## DiveCon

Kevin_Kennedy said:


> Yukon said:
> 
> 
> 
> Nixon removed the USA from the gold standard in 1971 to fuel his illegal Vietnam war.
> 
> 
> 
> 
> We were off the gold standard long before this.
Click to expand...

FDR did it


just more proof that yukon is an idiot


----------



## DiveCon

Yukon said:


> Nixon removed the USA from the gold standard in 1971 to fuel his illegal Vietnam war.


you really are an idiot
Nixon didnt even start the Vietnam war
keep showing what a fucking moron you are


----------



## Toro

Yukon said:


> As I stated earlier it was Adolph Hitler who ended the Great Depression by attacking Poland.




Maybe we can end this depression by having Obama attack British Columbia!


----------



## DiveCon

Toro said:


> Yukon said:
> 
> 
> 
> As I stated earlier it was Adolph Hitler who ended the Great Depression by attacking Poland.
> 
> 
> 
> 
> 
> Maybe we can end this depression by having Obama attack British Columbia!
Click to expand...

or maybe slightly to the north of BC


----------



## manu1959

Toro said:


> Yukon said:
> 
> 
> 
> As I stated earlier it was Adolph Hitler who ended the Great Depression by attacking Poland.
> 
> 
> 
> 
> 
> Maybe we can end this depression by having Obama attack British Columbia!
Click to expand...


i think he is trying to end it by attacking the wealthy suburbs of america..........


----------



## Chris

manu1959 said:


> Toro said:
> 
> 
> 
> 
> 
> Yukon said:
> 
> 
> 
> As I stated earlier it was Adolph Hitler who ended the Great Depression by attacking Poland.
> 
> 
> 
> 
> 
> Maybe we can end this depression by having Obama attack British Columbia!
> 
> Click to expand...
> 
> 
> i think he is trying to end it by attacking the wealthy suburbs of america..........
Click to expand...


I'm all for it.

We can start with the hedge fund managers!


----------



## DiveCon

Chris said:


> manu1959 said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> Maybe we can end this depression by having Obama attack British Columbia!
> 
> 
> 
> 
> i think he is trying to end it by attacking the wealthy suburbs of america..........
> 
> Click to expand...
> 
> 
> I'm all for it.
> 
> We can start with the hedge fund managers!
Click to expand...

how about we start with Realtors who convinced people they could afford houses beyond their means?


----------



## Chris

DiveCon said:


> Chris said:
> 
> 
> 
> 
> 
> manu1959 said:
> 
> 
> 
> i think he is trying to end it by attacking the wealthy suburbs of america..........
> 
> 
> 
> 
> I'm all for it.
> 
> We can start with the hedge fund managers!
> 
> Click to expand...
> 
> how about we start with Realtors who convinced people they could afford houses beyond their means?
Click to expand...


Only 6% of homes are in foreclosure. 

Nice try at deflecting the blame from the real problem, which is the $519 trillion dollar derivative bubble.


----------



## DiveCon

Chris said:


> DiveCon said:
> 
> 
> 
> 
> 
> Chris said:
> 
> 
> 
> I'm all for it.
> 
> We can start with the hedge fund managers!
> 
> 
> 
> how about we start with Realtors who convinced people they could afford houses beyond their means?
> 
> Click to expand...
> 
> 
> Only 6% of homes are in foreclosure.
> 
> Nice try at deflecting the blame from the real problem, which is the $519 trillion dollar derivative bubble.
Click to expand...

LOL
you are a part of the real problem


----------



## Chris

DiveCon said:


> Chris said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> how about we start with Realtors who convinced people they could afford houses beyond their means?
> 
> 
> 
> 
> Only 6% of homes are in foreclosure.
> 
> Nice try at deflecting the blame from the real problem, which is the $519 trillion dollar derivative bubble.
> 
> Click to expand...
> 
> LOL
> you are a part of the real problem
Click to expand...


Personal attack.

Another deflection.

People sitting on their butts collecting government checks like you are the problem.


----------



## Yukon

Anyone collecting money from the government for doing noting is the problem - I don't care what excuse you have for taking it - former GI Joe, single mother, etc, etc - you're a *BUM !*


----------



## DiveCon

Chris said:


> DiveCon said:
> 
> 
> 
> 
> 
> Chris said:
> 
> 
> 
> Only 6% of homes are in foreclosure.
> 
> Nice try at deflecting the blame from the real problem, which is the $519 trillion dollar derivative bubble.
> 
> 
> 
> LOL
> you are a part of the real problem
> 
> Click to expand...
> 
> 
> Personal attack.
> 
> Another deflection.
> 
> People sitting on their butts collecting government checks like you are the problem.
Click to expand...

you know nothing about me
so you are LYING

however, you as a self proclaimed realtor, have more than likely convinced someone that they could afford a house beyond their ability to pay
just so you could get a larger commission
if you say you havent, then i know you are LYING


----------



## johnrocks

Fed. created the bubbles.  Read Greenspan's Bubbles   [ame=http://www.amazon.com/GREENSPANS-BUBBLES-IGNORANCE-FEDERAL-RESERVE/dp/0071591583]Amazon.com: GREENSPAN'S BUBBLES: THE AGE OF IGNORANCE AT THE FEDERAL RESERVE: William Fleckenstein, Fred Sheehan: Books[/ame]

You can even read this
The Mess Greenspan Leaves - Stefan Karlsson - Mises Institute  it was posted 12/26/2005, well before this mess took center stage.

From the stock market crash of 1987 to the S&L crisis of the early 1990s to the Asian crisis and the collapse of LTCM to the feared Y2K crisis to the bursting of the tech stock bubble, Greenspan has proven himself more than willing to bail out failed investors with additional doses of "liquidity" (the popular inflationist euphemism for inflation).

The result of this has been to increase the willingness of investors to participate in speculative bubbles because they know that if things go wrong and they are unable to get out before the bubble burst, their good friend Alan Greenspan will bail them out and limit their losses. Greenspan has thus been responsible for bubbles like the tech stock bubble and the housing bubble both by suppressing interest rates and providing the "liquidity" needed to create the bubbles, and also by reducing investors fear of losses after the bubble bursts by creating the expectations that the Fed will bail them out.

The consequences of this have been great. Instead of falling as a result of increased production, the consumer price index rose nearly 74% between August 1987 and November 2005, an average annual increase of 3.1%. This, together with the even greater asset price increases means that the purchasing power of the dollar has been sharply reduced, something which in turn has constituted large scale "confiscations of wealth," as the 1966 Alan Greenspan described inflation.

Moreover, the illusionary paper wealth created by Greenspan's bubbles has in turn greatly encouraged people to reduce their savings and increase their debts. The gross national savings rate has fallen since 1987 from 16.5% to 13%, and the net national savings rate from 4.5% to 1%. (During the third quarter this year it fell below zero due to Katrina-related damages). This decline in savings has come entirely in the household sector, as the household savings rate has fallen from 7% to -1%. Similarly, the private sector debt burden has increased from 120% of GDP to 153%. Again, this increase has been concentrated in the household sector where debt has increased from 77% of disposable income to 121%. Mortgage debt in particular has increased, from 51% to 91% of disposable income.


----------



## Chris

DiveCon said:


> Chris said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> LOL
> you are a part of the real problem
> 
> 
> 
> 
> Personal attack.
> 
> Another deflection.
> 
> People sitting on their butts collecting government checks like you are the problem.
> 
> Click to expand...
> 
> you know nothing about me
> so you are LYING
> 
> however, you as a self proclaimed realtor, have more than likely convinced someone that they could afford a house beyond their ability to pay
> just so you could get a larger commission
> if you say you havent, then i know you are LYING
Click to expand...


That shows what an ignoramus you are.

I have no idea what people can afford. Realtors don't get involved with people's credit. That's what mortgage officers do. In fact I lost about $30,000 worth of business over the last three years because my mortgage officer was so conservative. But their company is still in business because of that.

Enjoy spending my tax dollars.


----------



## DiveCon

Chris said:


> DiveCon said:
> 
> 
> 
> 
> 
> Chris said:
> 
> 
> 
> Personal attack.
> 
> Another deflection.
> 
> People sitting on their butts collecting government checks like you are the problem.
> 
> 
> 
> you know nothing about me
> so you are LYING
> 
> however, you as a self proclaimed realtor, have more than likely convinced someone that they could afford a house beyond their ability to pay
> just so you could get a larger commission
> if you say you havent, then i know you are LYING
> 
> Click to expand...
> 
> 
> That shows what an ignoramus you are.
> 
> I have no idea what people can afford. Realtors don't get involved with people's credit. That's what mortgage officers do. In fact I lost about $30,000 worth of business over the last three years because my mortgage officer was so conservative. But their company is still in business because of that.
> 
> Enjoy spending my tax dollars.
Click to expand...

i dont spend your tax dollars, asshole
LOL
and sure you do, you know because they tell you
and you convince them they can


----------



## LiveUninhibited

Both sides here love insults. Hopefully they know it doesn't help them make their points. I suppose it can be amusing.


----------



## Old Rocks

glockmail said:


> Old Rocks said:
> 
> 
> 
> Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. ...
> 
> 
> 
> This is an obvious admission that you don't have a clue about basic economics, a basic liberal trait.
Click to expand...


I knew I would find a member of the Catostomidae with that quote from Eisenhower.

Dwight D. Eisenhower Quotes - The Quotations Page

Eisenhower, more than any man, knew the waste and futility of war. He was a good President, and a great leader in the Second World War.


----------



## glockmail

Old Rocks said:


> glockmail said:
> 
> 
> 
> 
> 
> Old Rocks said:
> 
> 
> 
> Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. ...
> 
> 
> 
> This is an obvious admission that you don't have a clue about basic economics, a basic liberal trait.
> 
> Click to expand...
> 
> 
> I knew I would find a member of the Catostomidae with that quote from Eisenhower.
> 
> Dwight D. Eisenhower Quotes - The Quotations Page
> 
> Eisenhower, more than any man, knew the waste and futility of war. He was a good President, and a great leader in the Second World War.
Click to expand...

That was my quote not Ike's. And it's very true.


----------



## Aimee Huhes

There are a number of opinions about why and how *The Great Depression* ended. That World War II was the definitive catalyst is rarely argued. The war opened up several new markets for the US and gave them a competitive advantage over other countries. This, along with the deregulation of certain sectors in the war time raised employment and gave the failing economy the kick start that it needed. You can check out *Shmoop* for more resource materials and information on the Great Depression.


----------



## editec

*EVERY*THING that happened post WWII conspired to make the USA come out of the depression folks and begin to thrive in a way it had never done in the past.

Selecting just one or two thing is missing the point of what an economy really is.

The economy is not one or two benchmarks, it is EVERYTHING which is occurring.

But Here's* some* of those things which did so much for our economy post WWII:

1. A huge pent up demand for consumer goods

2. A large amount of money in the hands of the consumers because they could not spend their war prodcution money_ during_ the war

3. A huge amount of investment capital available since the investor class had made so much money supplying the war.

4. The GI bill sending 12 million people to colleges who'd had NO CHANCE to go to college before the war

5. The fact that Europe was in a shambles, had practically NO industry and needed to rebuild so they ended up buying American

6. STrong union power thus insuring that the working class would get their fair share of the profits.

7. VERY HIGH taxes on the wealthy (about 90%) thus giving them every incentive to reinvest profits back into industry rather than pay taxes on it.

8. A continued MASSIVE amount of spending on the military industrial complex.

9. A startling spike in childbirths necessitating a huge demand for conumser goods typical of growing families.

10. The implementation of techological advances into private industry which had been developed during the period of manufacturing for war.

_All those things_ eventually contributed to the period from about 1955 till about 1969 to make the American Middle class wealthier, which naturally mades EVERY CLASS in American better off.


----------



## Truthmatters

Bern80 said:


> Truthmatters said:
> 
> 
> 
> that chart always ends the discussion.
> 
> 
> 
> 
> No it doesn't, this is just another in a long line of non-correlaries that get presented by the likes of yourself.  Two things happening at the same time does not mean that one caused the other.
Click to expand...


File:Gdp20-40.jpg - Wikipedia, the free encyclopedia


Maybe you better look at it again


----------



## Truthmatters

VERY HIGH taxes on the wealthy (about 90%) thus giving them every incentive to reinvest profits back into industry rather than pay taxes on it.


This a point that doesnt get enough play.

good stuff editec


----------



## Red Dawn

SpidermanTuba said:


> Midnight Marauder said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> its so relevant to now
> 
> 
> 
> It really isn't. We haven't even reached the economic lows established in the late 70s, much less the 30s. But, I'll forget that and stay on topic.
> 
> Economic studies have indicated that just as the downturn was spread worldwide by the rigidities of the Gold Standard, it was suspending gold convertibility (or devaluing the currency in gold terms) that did most to make recovery possible.
> 
> US recovery is generally agreed to have begun in the spring of 1933. There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and the sharp contraction of the 1937 recession that interrupted it). According to Christina Romer, the money supply growth caused by huge gold inflows was a crucial source of the recovery of the United States economy, and that fiscal policy and World War II were of little help.
> 
> Of course, it depends on who you ask.
> 
> Click to expand...
> 
> It seems an awful big coincidence though, that the recover really hit full swing with WW II, don't you think?
Click to expand...




either way, massive government spending ended it. 

Massive spending on arms or public works projects, take your pick. 


Either theory blows out of the water, the  rightwing asertion that governmnet spending made things worse.


----------



## Toro

Red Dawn said:


> either way, massive government spending ended it.
> 
> Massive spending on arms or public works projects, take your pick.
> 
> 
> Either theory blows out of the water, the  rightwing asertion that governmnet spending made things worse.



Also, several Depression-era laws such as FDIC also ended the Depression.

However, the criticism that FDR fixed prices too high inhibited the recovery is a valid criticism that has been demonstrated empirically. 

Net-net, the Depression ended because of FDR's policies and because the market finally cleared, even though some of FDR's policies inhibited price discovery.


----------



## editec

Red Dawn said:


> SpidermanTuba said:
> 
> 
> 
> 
> 
> Midnight Marauder said:
> 
> 
> 
> It really isn't. We haven't even reached the economic lows established in the late 70s, much less the 30s. But, I'll forget that and stay on topic.
> 
> Economic studies have indicated that just as the downturn was spread worldwide by the rigidities of the Gold Standard, it was suspending gold convertibility (or devaluing the currency in gold terms) that did most to make recovery possible.
> 
> US recovery is generally agreed to have begun in the spring of 1933. There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and the sharp contraction of the 1937 recession that interrupted it). According to Christina Romer, the money supply growth caused by huge gold inflows was a crucial source of the recovery of the United States economy, and that fiscal policy and World War II were of little help.
> 
> Of course, it depends on who you ask.
> 
> 
> 
> It seems an awful big coincidence though, that the recover really hit full swing with WW II, don't you think?
> 
> Click to expand...
> 
> 
> 
> 
> either way, massive government spending ended it.
> 
> Massive spending on arms or public works projects, take your pick.
> 
> 
> Either theory blows out of the water, the rightwing asertion that governmnet spending made things worse.
Click to expand...

 
The miscommunication problem, RD is that that when some of the tools here say "worse" and when you say "worse" you're talking about two very different definitions of "worse"

To some very wealthy people, the economy on the rocks only means their liquidity will serve to buy them an even greater share of the nation's assets.

To the rest of us, an economy on the rocks means _OUR_ ECONOMY is on the rocks.

So using terms like that tend to get us all confused.


----------



## editec

Toro said:


> Red Dawn said:
> 
> 
> 
> either way, massive government spending ended it.
> 
> Massive spending on arms or public works projects, take your pick.
> 
> 
> Either theory blows out of the water, the rightwing asertion that governmnet spending made things worse.
> 
> 
> 
> 
> Also, several Depression-era laws such as FDIC also ended the Depression.
> 
> *However, the criticism that FDR fixed prices too high inhibited the recovery is a valid criticism that has been demonstrated empirically. *
> 
> Net-net, the Depression ended because of FDR's policies and because the market finally cleared, even though some of FDR's policies inhibited price discovery.
Click to expand...

 
I think it quite reasonable to suggest that not _everything_ FDR did helped the economy, and that some things he did likely worked against his goal.

The above is a fair criticism, for example.

And can we all ALSO agree, that while FDR's actions probably saved a LOT of Americans from indigency, even though that his New Deal policies were not in and of themselves, THE solution?

I think even the most ardent supporter of FDR's New Deal would agree to that criiticism.

World War two put enormous amounts of money into circulation _(while not giving people anything to spend it on!)_ and put tens of millions of Americans to work in PRIVATE INDUSTRY as well as in GOVERNMENT SERVICE.

World War II ENDED the unemployment problem for Americans far more than the conservation corps and all the other government work New Deal programs ever could have, because of the SCALE difference between a feeble amount of social spending versus an_ all out_ military war economy.

We _ALL_ understand that_, right?_


----------



## Red Dawn

editec said:


> Red Dawn said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> It seems an awful big coincidence though, that the recover really hit full swing with WW II, don't you think?
> 
> 
> 
> 
> 
> 
> either way, massive government spending ended it.
> 
> Massive spending on arms or public works projects, take your pick.
> 
> 
> Either theory blows out of the water, the rightwing asertion that governmnet spending made things worse.
> 
> Click to expand...
> 
> 
> The miscommunication problem, RD is that that when some of the tools here say "worse" and when you say "worse" you're talking about two very different definitions of "worse"
> 
> To some very wealthy people, the economy on the rocks only means their liquidity will serve to buy them an even greater share of the nation's assets.
> 
> To the rest of us, an economy on the rocks means _OUR_ ECONOMY is on the rocks.
> 
> So using terms like that tend to get us all confused.
Click to expand...



good point. 


still, either way, massive government spending got us out of the great depression.  So, the libetarian and rightwing fools who say government spending made it worse have a lot of explaining to do .


----------



## Kevin_Kennedy

Red Dawn said:


> SpidermanTuba said:
> 
> 
> 
> 
> 
> Midnight Marauder said:
> 
> 
> 
> It really isn't. We haven't even reached the economic lows established in the late 70s, much less the 30s. But, I'll forget that and stay on topic.
> 
> Economic studies have indicated that just as the downturn was spread worldwide by the rigidities of the Gold Standard, it was suspending gold convertibility (or devaluing the currency in gold terms) that did most to make recovery possible.
> 
> US recovery is generally agreed to have begun in the spring of 1933. There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and the sharp contraction of the 1937 recession that interrupted it). According to Christina Romer, the money supply growth caused by huge gold inflows was a crucial source of the recovery of the United States economy, and that fiscal policy and World War II were of little help.
> 
> Of course, it depends on who you ask.
> 
> 
> 
> It seems an awful big coincidence though, that the recover really hit full swing with WW II, don't you think?
> 
> Click to expand...
> 
> 
> 
> 
> either way, massive government spending ended it.
> 
> Massive spending on arms or public works projects, take your pick.
> 
> 
> Either theory blows out of the water, the  rightwing asertion that governmnet spending made things worse.
Click to expand...


Actually it didn't end until _after_ WW2 when spending was cut and taxes were cut.  War-time spending certainly didn't get us out, because that's always destructive to the economy.


----------



## Toro

Kevin_Kennedy said:


> Actually it didn't end until _after_ WW2 when spending was cut and taxes were cut.  War-time spending certainly didn't get us out, because that's always destructive to the economy.



This is incorrect.

If the government significantly increases demand to go blow things up _over there_, then the war is stimulative to the domestic economy.  It is bad for _over there_ but it is good for right here.

For example, corporate profits hit a multi-decade high in 1918 and were not surpassed until the 1950s.


----------



## Kevin_Kennedy

Toro said:


> Kevin_Kennedy said:
> 
> 
> 
> Actually it didn't end until _after_ WW2 when spending was cut and taxes were cut.  War-time spending certainly didn't get us out, because that's always destructive to the economy.
> 
> 
> 
> 
> This is incorrect.
> 
> If the government significantly increases demand to go blow things up _over there_, then the war is stimulative to the domestic economy.  It is bad for _over there_ but it is good for right here.
> 
> For example, corporate profits hit a multi-decade high in 1918 and were not surpassed until the 1950s.
Click to expand...


A majority of production moving into supplying instruments of war is not helpful to the economy at home, because the only demand is from the military and not any domestic sources.  Furthermore, the money spent on the war was taken from the citizens through taxation and inflation, which of course takes us to Bastiat's "What is seen and unseen."


----------



## elvis

I am going to make the statement that Japan ended the Depression.  I would like your opinions on the statement.


----------



## Toro

Kevin_Kennedy said:


> Toro said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Actually it didn't end until _after_ WW2 when spending was cut and taxes were cut.  War-time spending certainly didn't get us out, because that's always destructive to the economy.
> 
> 
> 
> 
> This is incorrect.
> 
> If the government significantly increases demand to go blow things up _over there_, then the war is stimulative to the domestic economy.  It is bad for _over there_ but it is good for right here.
> 
> For example, corporate profits hit a multi-decade high in 1918 and were not surpassed until the 1950s.
> 
> Click to expand...
> 
> 
> A majority of production moving into supplying instruments of war is not helpful to the economy at home, because the only demand is from the military and not any domestic sources.  Furthermore, the money spent on the war was taken from the citizens through taxation and inflation, which of course takes us to Bastiat's "What is seen and unseen."
Click to expand...


Military demand is the domestic source.

But of course, domestic source does not matter.  Exports are not a domestic source yet they add to the aggregate demand of the economy.

Your statement is only correct if there is no excess capacity in the economy.  There was significant excess capacity after the Depression.  

It also assumes that the velocity of money is high.  If the velocity of money is low, government spending is stimulative even if there is taxation.  For example, if everyone is sitting on their hands not spending and letting the money sit in the bank (or their mattress as was common during the Depression), the government taking the money and spending increases economic activity.  This is known as The Paradox of Thrift.


----------



## elvis

Did the Vietnam War boost the economy?


----------



## Kevin_Kennedy

Toro said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> This is incorrect.
> 
> If the government significantly increases demand to go blow things up _over there_, then the war is stimulative to the domestic economy.  It is bad for _over there_ but it is good for right here.
> 
> For example, corporate profits hit a multi-decade high in 1918 and were not surpassed until the 1950s.
> 
> 
> 
> 
> A majority of production moving into supplying instruments of war is not helpful to the economy at home, because the only demand is from the military and not any domestic sources.  Furthermore, the money spent on the war was taken from the citizens through taxation and inflation, which of course takes us to Bastiat's "What is seen and unseen."
> 
> Click to expand...
> 
> 
> Military demand is the domestic source.
> 
> But of course, domestic source does not matter.  Exports are not a domestic source yet they add to the aggregate demand of the economy.
> 
> Your statement is only correct if there is no excess capacity in the economy.  There was significant excess capacity after the Depression.
> 
> It also assumes that the velocity of money is high.  If the velocity of money is low, government spending is stimulative even if there is taxation.  For example, if everyone is sitting on their hands not spending and letting the money sit in the bank (or their mattress as was common during the Depression), the government taking the money and spending increases economic activity.  This is known as The Paradox of Thrift.
Click to expand...


Yes, there was demand for the production of war materials, but they were of no value to anyone domestically.  The average joe certainly couldn't afford, and would have had no use for a tank or a missile.  For all the good war spending does at home the government might as well have paid people to go into a desert and dig holes, then pay another group of people to go fill them in again.  As to the "paradox of thrift," I'm familiar with it.  But whether people are "hoarding" their money or not we still fall into Bastiat's "What is seen and what is unseen."

Bastiat: Selected Essays, Chapter 1, What Is Seen and What Is Not Seen | Library of Economics and Liberty

If we take money from people just because they're saving it, we still hurt the economy.  What would they spend that money on in the future is what we have to ask, and how many jobs are we going to lose if we stop them from spending that money in the future?

Consumers Don't Cause Recessions - Robert P. Murphy - Mises Institute


----------



## Kevin_Kennedy

elvis3577 said:


> Did the Vietnam War boost the economy?



No, war spending is always destructive to the economy.  The government must take the money for the war from the private sector, and whether they do this immediately through direct taxation, borrow money which leads to future taxation, or inflate which reduces everybody's wealth it hurts the economy.  It means that people cannot then spend that money that was taken on what they otherwise would have, and jobs must then be lost in the process.


----------



## Chris

A better question would be, what got us into the great depression?

Unregulated greed and protectionism.


----------



## DiveCon

Chris said:


> A better question would be, what got us into the great depression?
> 
> Unregulated greed and protectionism.


it was more people over extending their means

but it figures you would be clueless


----------



## Toro

Kevin_Kennedy said:


> Yes, there was demand for the production of war materials, but they were of no value to anyone domestically.  The average joe certainly couldn't afford, and would have had no use for a tank or a missile.  For all the good war spending does at home the government might as well have paid people to go into a desert and dig holes, then pay another group of people to go fill them in again.  As to the "paradox of thrift," I'm familiar with it.  But whether people are "hoarding" their money or not we still fall into Bastiat's "What is seen and what is unseen."
> 
> Bastiat: Selected Essays, Chapter 1, What Is Seen and What Is Not Seen | Library of Economics and Liberty
> 
> If we take money from people just because they're saving it, we still hurt the economy.  What would they spend that money on in the future is what we have to ask, and how many jobs are we going to lose if we stop them from spending that money in the future?
> 
> Consumers Don't Cause Recessions - Robert P. Murphy - Mises Institute



I am very aware of "what is seen and what is unseen."  "The Law" was the second book I ever read on economics.  The first was "Economics in One Lesson," which I am sure you heard of.

You argument assumes that prices are always in equilibrium.  But that is not always the case. Here is a conversation I have been having many times over the past several months.

Me: "Why don't you invest now?  Asset prices are cheap."
Them: "We are waiting to see the economy improve."

Everyone whom I have asked this question has given me this exact answer, or some facsimile.  If _everyone_ is waiting to see the economy improve, it won't.  It is very, very easy to see that if financial crises continue, then everyone sitting on their hands because the economy is awful becomes a self-fulfilling prophecy.  In this, the perception becomes reality.  George Soros called this "reflexivity."  If everyone believes something will happen in financial markets and economics, then it can and does.

This is what happened during the Depression as thousands of banks failed.  With massive excess capacity and consumers not spending, the government stepped in to replace the absent demand.

The problem with the argument you present is that you assume people are always rational.  If people were always rational, people would not react with fear and greed.  When people are fearful and paralyzed, their lack of action can become a self-reinforcing cycle.


----------



## Kevin_Kennedy

Chris said:


> A better question would be, what got us into the great depression?
> 
> Unregulated greed and protectionism.



The Federal Reserve, the same way they created our current problem.


----------



## DiveCon

Kevin_Kennedy said:


> Chris said:
> 
> 
> 
> A better question would be, what got us into the great depression?
> 
> Unregulated greed and protectionism.
> 
> 
> 
> 
> The Federal Reserve, the same way they created our current problem.
Click to expand...

chris is too stupid to understand you can not regulate greed
and yes, greed had a part in it, but if they didnt allow investing on margin, that wouldnt have caused the same problems


----------



## Toro

DiveCon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Chris said:
> 
> 
> 
> A better question would be, what got us into the great depression?
> 
> Unregulated greed and protectionism.
> 
> 
> 
> 
> The Federal Reserve, the same way they created our current problem.
> 
> Click to expand...
> 
> chris is too stupid to understand you can not regulate greed
> and yes, greed had a part in it, but if they didnt allow investing on margin, that wouldnt have caused the same problems
Click to expand...


You cannot regulate greed but you can create a regulatory architecture such that greed doesn't completely destroy an economy, or at least limits the damage.  Simplistically, if we required all financial institutions to hold an excess amount of capital - which we did not leading up to this crisis - then the likelihood of a credit-induced implosion is far less likely.

The Fed was probably the primary culprit of turning a nasty recession into The Great Depression.  However, people have to remember why the Fed came into being in the first place.  People had concluded that the cyclicality and instability of the financial system was increasing the volatility of the real economy without a central bank.


----------



## editec

The banks were lending 35 times as much money as they had in reserves to begin with.

And when those dubious assets they held turned out to be worth far less than they thought they were?

DEFLATION was the inevitable outcome.

Had it not been for FDR's banking REGULATION called FDIC, the run on the banks would have caused every bank in the United States to fail.

Anyone care to despute that theory?

Particularly anyone who believes that all regulations on capitalism are a bad idea?


----------



## Yukon

Who are the 'Bankers', where do they come from, who do they report to, why do they get away with crimes against humanity, is it a conspiracy? Tell me.......................


----------



## Kevin_Kennedy

editec said:


> The banks were lending 35 times as much money as they had in reserves to begin with.
> 
> And when those dubious assets they held turned out to be worth far less than they thought they were?
> 
> DEFLATION was the inevitable outcome.
> 
> Had it not been for FDR's banking REGULATION called FDIC, the run on the banks would have caused every bank in the United States to fail.
> 
> Anyone care to despute that theory?
> 
> Particularly anyone who believes that all regulations on capitalism are a bad idea?



And if the government did not allow fractional reserve banking, which can be defined as fraud, then bank runs wouldn't be a problem.


----------



## Yukon

Kevin,

You would be wise to say nothing about banks. You'll seem brighter than you really are.


----------



## Kevin_Kennedy

Yukon said:


> Kevin,
> 
> You would be wise to say nothing about banks. You'll seem brighter than you really are.



I'm too young to be wise.


----------



## Yukon

Kevin, 

You are truthful my son !


----------



## editec

Kevin_Kennedy said:


> editec said:
> 
> 
> 
> The banks were lending 35 times as much money as they had in reserves to begin with.
> 
> And when those dubious assets they held turned out to be worth far less than they thought they were?
> 
> DEFLATION was the inevitable outcome.
> 
> Had it not been for FDR's banking REGULATION called FDIC, the run on the banks would have caused every bank in the United States to fail.
> 
> Anyone care to despute that theory?
> 
> Particularly anyone who believes that all regulations on capitalism are a bad idea?
> 
> 
> 
> 
> And if the government did not allow fractional reserve banking, which can be defined as fraud, then bank runs wouldn't be a problem.
Click to expand...

 
If there was no fractal banking, if, as I presume you are suggesting but didn't clarify, all money was backed by gold?

Then we would have to restructure our economy to cope with continuous deflation.

Now there may be a way to do that and still have a thriving growing economy.

Only I cannot imagine how it will work.

How, for example, does a farmer or an industry (traditionally they borrow every year to invest in their businesses) borrow money when the money they will pay back will be worth MORE than the money they recieved, PLUS the prices the will get for their goods will ALSO be declining?

It seems to me that we must have a continuously growing amount of cash in circulation if our society is continuously increasing the amounts of goods and services it is producing.

As to crashing the FED and returning to private banking?

That doesn't in ANY WAY address the problem of DEFLATION in a gold standard economy.

Now if somebody can explain to me how a gold back economy can work in a _modern industrial society_, one where the amount of population and goods and services it produceds continue to rise every year, then I'm more than willing to consider the gold standard.

As to fractal banking?

UNTIL fractal banking was invented there really was no banking industry.

I suspect bank can NOT lend_ only the money that they have in deposits_ and thrive as a business.

Not unless you're talking about returning to 14th century SHYLOCK banking, of course.

The Mafia can do that, becaause the interest they charge is _so enormous_, and failure to pay doesn't lead to legal bankrupsy, it leads to leg breaking.


----------



## disciple2184

The war left many millions dead and this was a big help in saving the world from the depression, population control.


----------



## edthecynic

Kevin_Kennedy said:


> Toro said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Actually it didn't end until _after_ WW2 when spending was cut and taxes were cut.  War-time spending certainly didn't get us out, because that's always destructive to the economy.
> 
> 
> 
> 
> This is incorrect.
> 
> If the government significantly increases demand to go blow things up _over there_, then the war is stimulative to the domestic economy.  It is bad for _over there_ but it is good for right here.
> 
> For example, corporate profits hit a multi-decade high in 1918 and were not surpassed until the 1950s.
> 
> Click to expand...
> 
> 
> *A majority of production moving into supplying instruments of war is not helpful to the economy at home, because the only demand is from the military and not any domestic sources.*  Furthermore, the money spent on the war was taken from the citizens through taxation and inflation, which of course takes us to Bastiat's "What is seen and unseen."
Click to expand...


That is not 100% true. Refrigerators and air conditioning, etc., were originally invented for battleships and later made available to the domestic market, which has kept up demand to the present.


----------



## Kevin_Kennedy

edthecynic said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> This is incorrect.
> 
> If the government significantly increases demand to go blow things up _over there_, then the war is stimulative to the domestic economy.  It is bad for _over there_ but it is good for right here.
> 
> For example, corporate profits hit a multi-decade high in 1918 and were not surpassed until the 1950s.
> 
> 
> 
> 
> *A majority of production moving into supplying instruments of war is not helpful to the economy at home, because the only demand is from the military and not any domestic sources.*  Furthermore, the money spent on the war was taken from the citizens through taxation and inflation, which of course takes us to Bastiat's "What is seen and unseen."
> 
> Click to expand...
> 
> 
> That is not 100% true. Refrigerators and air conditioning, etc., were originally invented for battleships and later made available to the domestic market, which has kept up demand to the present.
Click to expand...


That's an interesting fact, and not something that I was aware of.  However, the fact remains the same that war-time spending is always destructive to the economy.  These things may have been developed for naval use originally, but demand for these types of appliances would have led to the private sector supplying them at some point.


----------



## edthecynic

Midnight Marauder said:


> Truthmatters said:
> 
> 
> 
> The one who is spouting partisan hackery is you.
> 
> FDRs actions during the great depression was credited by the people who lived it as well as the vast majority of historians for pulling us out of the great depression.
> 
> You are trying to rewrite history and you have failed.
> 
> 
> 
> FDR was an outstanding con man. Even The Obama knows this. He said so himself: "What you see in FDR that I hope my team can emulate is, not always getting it right, but projecting a sense of confidence." That's what FDR did, projected a sense of confidence. While he was screwing up royally and making the depression worse, the folks loved him.* "Projecting a sense of confidence" is what all con men do, that's why they're called that.*
Click to expand...


RUSH:  Reagan was this epitome of optimism...  *He had confidence;* he had optimism


----------



## Bfgrn

Gunny said:


> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
Click to expand...


SO...it was ended by government spending


----------



## editec

DiveCon said:


> Chris said:
> 
> 
> 
> A better question would be, what got us into the great depression?
> 
> Unregulated greed and protectionism.
> 
> 
> 
> it was more people over extending their means
> 
> but it figures you would be clueless
Click to expand...

 
True...but which people were truly overextended?

INVESTORS, not consumers

Ever hear of the term MARGIN CALL?


----------



## Kevin_Kennedy

Bfgrn said:


> Gunny said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
> 
> Click to expand...
> 
> 
> SO...it was ended by government spending
Click to expand...


No, the Great Depression ended after WW2.


----------



## edthecynic

Gunny said:


> Truthmatters said:
> 
> 
> 
> FDR was seen as a HERO by the people who LIVED the great depression.
> 
> They know more about it than you can ever dream of knowing.
> 
> The economists are split right down the middle on the subject, can you guess why?
> 
> Historians are on his side by about 3/4ths.
> 
> I go with the people who lived it and the historians and half the economists.
> 
> whos on your side? half the economists and partisan hacks thats who.
> 
> 
> 
> 
> Sure he was.  That's how it works when you control the microphone and claim everything good as your doing.
> 
> Don't tell me what I know, *idiot.*  Being raised by Depression Era grandparents and parents, I'd say a know a lot more about it than YOU do, *so STFU.*
> 
> Any historian YOU would believe is *automatically no longer credible.
> *
> What FDR actually DID was create a legacy of failed government handout programs that have only survived through artificial respiration.
> 
> WWII ended the Depression.  End of story.  There was an immediate end to any unemployment problem and the people back here could work all the hours they wanted and make all the money they wanted and the WORLD was buying from US.
> 
> *Go pound sand*, huh?
Click to expand...


You set a fine example of proper board conduct. 
DiveCon certainly has taken your "style" to heart. You should be proud of yourself.


----------



## editec

> *The Great Depression - why did it end? *


 
*Dunno...The Great Prosac?*


----------



## Toro

Bfgrn said:


> Gunny said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
> 
> Click to expand...
> 
> 
> SO...it was ended by government spending
Click to expand...


Yes, that was one reason.


----------



## DiveCon

editec said:


> DiveCon said:
> 
> 
> 
> 
> 
> Chris said:
> 
> 
> 
> A better question would be, what got us into the great depression?
> 
> Unregulated greed and protectionism.
> 
> 
> 
> it was more people over extending their means
> 
> but it figures you would be clueless
> 
> Click to expand...
> 
> 
> True...but which people were truly overextended?
> 
> INVESTORS, not consumers
> 
> Ever hear of the term MARGIN CALL?
Click to expand...

yes, and it wasnt just investors
they allowed people to borrow beyond their means to repay
and they didnt have a margin call


----------



## DiveCon

Toro said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Gunny said:
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
> 
> 
> 
> 
> SO...it was ended by government spending
> 
> Click to expand...
> 
> 
> Yes, that was one reason.
Click to expand...

in some sense, but add to that the fact that the only production for most of the world was here in the USA for years after the war
thus we had HUGE exports


----------



## Yukon

Adolph Hitler ended the Great Depression by invading Poland in 1939. Of course that Depression lasted much longer in the USA because the USA refused to fight the tyranny of Nazi Germany until she was attacked by Japan. Almost 2 1/2 years lapsed from the end of the Depression in 1939 until America reluctantly entered WWII.


----------



## Garinold

You can look at statistics from the census bureau that show while unemployment steadily declined between 1932 and 1939, there were ups and downs and unemployment never fell below 12% if I'm not mistaken. I also recall unemployment reaching as high as 20% in may of 1939, after 7 years worth of Roosevelt's expansion of Gov't programs, regulations, and taxes.

You can also look at Henry Morgenthau's statements before the House Way's & Means Committee in 1939: _"We are spending more money than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get jobs. We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started and an enormous debt to boot."_ which amounts to what I would call "expert witness testimony" if the New Deal were on trial as being either a success or failure. In conclusion I would have to agree with some above posters that it was WW2 that began to bring about the end of the Great Depression and not the New Deal.


----------



## Kevin_Kennedy

Garinold said:


> You can look at statistics from the census bureau that show while unemployment steadily declined between 1932 and 1939, there were ups and downs and unemployment never fell below 12% if I'm not mistaken. I also recall unemployment reaching as high as 20% in may of 1939, after 7 years worth of Roosevelt's expansion of Gov't programs, regulations, and taxes.
> 
> You can also look at Henry Morgenthau's statements before the House Way's & Means Committee in 1939: _"We are spending more money than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get jobs. We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started and an enormous debt to boot."_ which amounts to what I would call "expert witness testimony" if the New Deal were on trial as being either a success or failure. In conclusion I would have to agree with some above posters that it was WW2 that began to bring about the end of the Great Depression and not the New Deal.



Well the same principle that applies to the New Deal applies to World War 2.  You can't spend your way out of a recession or a depression.

Yes, unemployment fell during WW2, but that's not surprising since so many were conscripted to go die over in Europe.  The production of military goods over consumer goods, price controls, and rations are not the features of a booming economy.

The Great Depression didn't end until after WW2.


----------



## Garinold

Kevin_Kennedy said:


> Garinold said:
> 
> 
> 
> You can look at statistics from the census bureau that show while unemployment steadily declined between 1932 and 1939, there were ups and downs and unemployment never fell below 12% if I'm not mistaken. I also recall unemployment reaching as high as 20% in may of 1939, after 7 years worth of Roosevelt's expansion of Gov't programs, regulations, and taxes.
> 
> You can also look at Henry Morgenthau's statements before the House Way's & Means Committee in 1939: _"We are spending more money than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get jobs. We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started and an enormous debt to boot."_ which amounts to what I would call "expert witness testimony" if the New Deal were on trial as being either a success or failure. In conclusion I would have to agree with some above posters that it was WW2 that began to bring about the end of the Great Depression and not the New Deal.
> 
> 
> 
> 
> Well the same principle that applies to the New Deal applies to World War 2.  You can't spend your way out of a recession or a depression.
> 
> Yes, unemployment fell during WW2, but that's not surprising since so many were conscripted to go die over in Europe.  The production of military goods over consumer goods, price controls, and rations are not the features of a booming economy.
> 
> The Great Depression didn't end until after WW2.
Click to expand...


Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.


----------



## Bfgrn

Garinold said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Garinold said:
> 
> 
> 
> You can look at statistics from the census bureau that show while unemployment steadily declined between 1932 and 1939, there were ups and downs and unemployment never fell below 12% if I'm not mistaken. I also recall unemployment reaching as high as 20% in may of 1939, after 7 years worth of Roosevelt's expansion of Gov't programs, regulations, and taxes.
> 
> You can also look at Henry Morgenthau's statements before the House Way's & Means Committee in 1939: _"We are spending more money than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get jobs. We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started and an enormous debt to boot."_ which amounts to what I would call "expert witness testimony" if the New Deal were on trial as being either a success or failure. In conclusion I would have to agree with some above posters that it was WW2 that began to bring about the end of the Great Depression and not the New Deal.
> 
> 
> 
> 
> Well the same principle that applies to the New Deal applies to World War 2.  You can't spend your way out of a recession or a depression.
> 
> Yes, unemployment fell during WW2, but that's not surprising since so many were conscripted to go die over in Europe.  The production of military goods over consumer goods, price controls, and rations are not the features of a booming economy.
> 
> The Great Depression didn't end until after WW2.
> 
> Click to expand...
> 
> 
> Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.
Click to expand...


This has turned into a pea brain conversation...

First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.

Second, WWII ended the depression...war IS government spending at at HUGE rate.

Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...

It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...

Right wing solutions are fucking great...if ONLY people would evaporate!

During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.  

http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion


----------



## editec

DiveCon said:


> editec said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> it was more people over extending their means
> 
> but it figures you would be clueless
> 
> 
> 
> 
> True...but which people were truly overextended?
> 
> INVESTORS, not consumers
> 
> Ever hear of the term MARGIN CALL?
> 
> Click to expand...
> 
> yes, and it wasnt just investors
> they allowed people to borrow beyond their means to repay
> and they didnt have a margin call
Click to expand...

 
Great theory...except its not supported by the facts.


----------



## editec

Kevin_Kennedy said:


> Garinold said:
> 
> 
> 
> You can look at statistics from the census bureau that show while unemployment steadily declined between 1932 and 1939, there were ups and downs and unemployment never fell below 12% if I'm not mistaken. I also recall unemployment reaching as high as 20% in may of 1939, after 7 years worth of Roosevelt's expansion of Gov't programs, regulations, and taxes.
> 
> You can also look at Henry Morgenthau's statements before the House Way's & Means Committee in 1939: _"We are spending more money than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get jobs. We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started and an enormous debt to boot."_ which amounts to what I would call "expert witness testimony" if the New Deal were on trial as being either a success or failure. In conclusion I would have to agree with some above posters that it was WW2 that began to bring about the end of the Great Depression and not the New Deal.
> 
> 
> 
> 
> Well the same principle that applies to the New Deal applies to World War 2. You can't spend your way out of a recession or a depression.
> 
> Yes, unemployment fell during WW2, but that's not surprising since so many were conscripted to go die over in Europe. The production of military goods over consumer goods, price controls, and rations are not the features of a booming economy.
> 
> The Great Depression didn't end until after WW2.
Click to expand...

 
It didn't REALLY end (if you use the stock market as your guide) *until 1956!*


----------



## Iriemon

SpidermanTuba said:


> Gunny said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> WWII ended it.  The mobilizing of US industry and sudden employment of any man between the age of 18-45 was a hit of speed on the economy.
> 
> Click to expand...
> 
> 
> Wasn't the employment of everyone 18-45 caused by a draft which was funded by massive government spending?
> 
> 
> What if the government today said, everyone who is between 18 and 45, who doesn't have a job, can come work for the government, and that went on for 4 years? Would that help?
> 
> Seems like the New Deal wasn't big enough. They weren't prepared to employ EVERYBODY. WW II did employ all men in those ages - which must have been  at least 35% of the workforce. Since unemployment wasn't at 35% this meant immediate full employment for anyone who wanted work, women, older men, and those unfit for military service.
Click to expand...


The economy started growing again, and fairly robustly, after FDR was elected and instituted the New Deal.

But it was a very deep hole to climb out of.


----------



## DiveCon

editec said:


> DiveCon said:
> 
> 
> 
> 
> 
> editec said:
> 
> 
> 
> True...but which people were truly overextended?
> 
> INVESTORS, not consumers
> 
> Ever hear of the term MARGIN CALL?
> 
> 
> 
> yes, and it wasnt just investors
> they allowed people to borrow beyond their means to repay
> and they didnt have a margin call
> 
> Click to expand...
> 
> 
> Great theory...except its not supported by the facts.
Click to expand...

actually, it is supported by the facts
you just refuse to admit it because it doesnt fit your political agenda


----------



## editec

DiveCon said:


> editec said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> yes, and it wasnt just investors
> they allowed people to borrow beyond their means to repay
> and they didnt have a margin call
> 
> 
> 
> 
> Great theory...except its not supported by the facts.
> 
> Click to expand...
> 
> actually, it is supported by the facts
> you just refuse to admit it because it doesnt fit your political agenda
Click to expand...

 
Okay, it was your assertion, so it's up to you to prove it.

*What was the level of debt racked up by the consuming class in 1929?*

*What percentage of the GDP could be attributed to consumer debt?*

*How does that compare to todays debt ratios?*


----------



## DiveCon

editec said:


> DiveCon said:
> 
> 
> 
> 
> 
> editec said:
> 
> 
> 
> Great theory...except its not supported by the facts.
> 
> 
> 
> actually, it is supported by the facts
> you just refuse to admit it because it doesnt fit your political agenda
> 
> Click to expand...
> 
> 
> Okay, it was your assertion, so it's up to you to prove it.
> 
> *What was the level of debt racked up by the consuming class in 1929?*
> 
> *What percentage of the GDP could be attributed to consumer debt?*
> 
> *How does that compare to todays debt ratios?*
Click to expand...

back then they could buy stock with only 10% secured funding
the other 90% was borrowed
it wasnt so much the consumer class as the investor class
thats what you either forget or are willfully ignoring


and my post was refering to today, not 1929
but, almost the same thing happened today with people buying beyond their means to repay


but go ahead and completely ignore those facts


----------



## Kevin_Kennedy

Bfgrn said:


> Garinold said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Well the same principle that applies to the New Deal applies to World War 2.  You can't spend your way out of a recession or a depression.
> 
> Yes, unemployment fell during WW2, but that's not surprising since so many were conscripted to go die over in Europe.  The production of military goods over consumer goods, price controls, and rations are not the features of a booming economy.
> 
> The Great Depression didn't end until after WW2.
> 
> 
> 
> 
> Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.
> 
> Click to expand...
> 
> 
> This has turned into a pea brain conversation...
> 
> First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
> 
> Second, WWII ended the depression...war IS government spending at at HUGE rate.
> 
> Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
> 
> It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
> 
> Right wing solutions are fucking great...if ONLY people would evaporate!
> 
> During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
> 
> http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
Click to expand...


If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?

Government spending can only hurt the economy, not help it.  Read Bastiat's _That Which is Seen, and That Which is Not Seen._


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Garinold said:
> 
> 
> 
> Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.
> 
> 
> 
> 
> This has turned into a pea brain conversation...
> 
> First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
> 
> Second, WWII ended the depression...war IS government spending at at HUGE rate.
> 
> Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
> 
> It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
> 
> Right wing solutions are fucking great...if ONLY people would evaporate!
> 
> During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
> 
> http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
> 
> Click to expand...
> 
> 
> If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
> 
> Government spending can only hurt the economy, not help it.  Read Bastiat's _That Which is Seen, and That Which is Not Seen._
Click to expand...


No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...

Join REALITY...


----------



## Kevin_Kennedy

Bfgrn said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> This has turned into a pea brain conversation...
> 
> First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
> 
> Second, WWII ended the depression...war IS government spending at at HUGE rate.
> 
> Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
> 
> It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
> 
> Right wing solutions are fucking great...if ONLY people would evaporate!
> 
> During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
> 
> http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
> 
> 
> 
> 
> If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
> 
> Government spending can only hurt the economy, not help it.  Read Bastiat's _That Which is Seen, and That Which is Not Seen._
> 
> Click to expand...
> 
> 
> No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
> 
> Join REALITY...
Click to expand...


Ok, well the reality is that government interventions in the market cause and then worsen economic downturns.  So you tell me how that helps people out of work, shelter, money, and food.


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
> 
> Government spending can only hurt the economy, not help it.  Read Bastiat's _That Which is Seen, and That Which is Not Seen._
> 
> 
> 
> 
> No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
> 
> Join REALITY...
> 
> Click to expand...
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns.  So you tell me how that helps people out of work, shelter, money, and food.
Click to expand...


Kevin...reality is TODAY... we could go back to Jefferson and Hamilton's vastly different views of what type of nation we should be, but it will not solve today's human conditions.

AND, are you willing to have America no longer be a world power Kevin?

We never had a true free market since Southern Pacific Railroad vs. the Santa Clara County gave corporations unequal protection under the law...

So YES, government intervention via the Supreme Court set the table for corporate welfare, but what Obama is doing today is absolutely necessary

It seems President Obama has the right approach...


----------



## Kevin_Kennedy

Bfgrn said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
> 
> Join REALITY...
> 
> 
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns.  So you tell me how that helps people out of work, shelter, money, and food.
> 
> Click to expand...
> 
> 
> Kevin...reality is TODAY... we could go back to Jefferson and Hamilton's vastly different views of what type of nation we should be, but it will not solve today's human conditions.
> 
> AND, are you willing to have America no longer be a world power Kevin?
> 
> We never had a true free market since Southern Pacific Railroad vs. the Santa Clara County gave corporations unequal protection under the law...
> 
> So YES, government intervention via the Supreme Court set the table for corporate welfare, but what Obama is doing today is absolutely necessary
> 
> It seems President Obama has the right approach...
Click to expand...


Except history says otherwise.

No Govt. Intervention = 1 year downturn

Massive Govt. Intervention = 15 years of the Great Depression, and Japan's "Lost Decade."


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns.  So you tell me how that helps people out of work, shelter, money, and food.
> 
> 
> 
> 
> Kevin...reality is TODAY... we could go back to Jefferson and Hamilton's vastly different views of what type of nation we should be, but it will not solve today's human conditions.
> 
> AND, are you willing to have America no longer be a world power Kevin?
> 
> We never had a true free market since Southern Pacific Railroad vs. the Santa Clara County gave corporations unequal protection under the law...
> 
> So YES, government intervention via the Supreme Court set the table for corporate welfare, but what Obama is doing today is absolutely necessary
> 
> It seems President Obama has the right approach...
> 
> Click to expand...
> 
> 
> Except history says otherwise.
> 
> No Govt. Intervention = 1 year downturn
> 
> Massive Govt. Intervention = 15 years of the Great Depression, and Japan's "Lost Decade."
Click to expand...


So you're solution is let our economy totally collapse, let people loose their jobs, homes and let them starve and die...then build a new country...

WOW Kevin... Hitler had more compassion...


----------



## Kevin_Kennedy

Bfgrn said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> Kevin...reality is TODAY... we could go back to Jefferson and Hamilton's vastly different views of what type of nation we should be, but it will not solve today's human conditions.
> 
> AND, are you willing to have America no longer be a world power Kevin?
> 
> We never had a true free market since Southern Pacific Railroad vs. the Santa Clara County gave corporations unequal protection under the law...
> 
> So YES, government intervention via the Supreme Court set the table for corporate welfare, but what Obama is doing today is absolutely necessary
> 
> It seems President Obama has the right approach...
> 
> 
> 
> 
> Except history says otherwise.
> 
> No Govt. Intervention = 1 year downturn
> 
> Massive Govt. Intervention = 15 years of the Great Depression, and Japan's "Lost Decade."
> 
> Click to expand...
> 
> 
> So you're solution is let our economy totally collapse, let people loose their jobs, homes and let them starve and die...then build a new country...
> 
> WOW Kevin... Hitler had more compassion...
Click to expand...


You're falling into the Chicken Little trap.  The sky wouldn't fall.  Things wouldn't be great, but after a year or so we'd be back where we want to be.  Now, however, we're just prolonging the agony.  So you say I have no compassion because I want to get out of this recession quickly, but the interventions you support are simply making everything worse.  So who really has no compassion?


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Except history says otherwise.
> 
> No Govt. Intervention = 1 year downturn
> 
> Massive Govt. Intervention = 15 years of the Great Depression, and Japan's "Lost Decade."
> 
> 
> 
> 
> So you're solution is let our economy totally collapse, let people loose their jobs, homes and let them starve and die...then build a new country...
> 
> WOW Kevin... Hitler had more compassion...
> 
> Click to expand...
> 
> 
> You're falling into the Chicken Little trap.  The sky wouldn't fall.  Things wouldn't be great, but after a year or so we'd be back where we want to be.  Now, however, we're just prolonging the agony.  So you say I have no compassion because I want to get out of this recession quickly, but the interventions you support are simply making everything worse.  So who really has no compassion?
Click to expand...


Well Kevin, you could be right, BUT the stakes are EXTREMELY high...and IF you ARE wrong, there will be a lot less Americans and possibly no America. The economy in this country was much different in 1921 and 1929. There are just way too many factors to examine to make oversimplified statements...

I'm not willing to put America in the hands of the beliefs of a community college teacher that dedicated his book to Ron Paul.

Many scholars attribute the events that became the Great Depression to Hoover signing the Smoot-Hawley Tariff Act, even though he opposed it...it caused American exports and imports to plunge by more than half. 

I am glad Obama is President...I can't imagine where we'd be with McCain in that office.


----------



## Kevin_Kennedy

Bfgrn said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> So you're solution is let our economy totally collapse, let people loose their jobs, homes and let them starve and die...then build a new country...
> 
> WOW Kevin... Hitler had more compassion...
> 
> 
> 
> 
> You're falling into the Chicken Little trap.  The sky wouldn't fall.  Things wouldn't be great, but after a year or so we'd be back where we want to be.  Now, however, we're just prolonging the agony.  So you say I have no compassion because I want to get out of this recession quickly, but the interventions you support are simply making everything worse.  So who really has no compassion?
> 
> Click to expand...
> 
> 
> Well Kevin, you could be right, BUT the stakes are EXTREMELY high...and IF you ARE wrong, there will be a lot less Americans and possibly no America. The economy in this country was much different in 1921 and 1929. There are just way too many factors to examine to make oversimplified statements...
> 
> I'm not willing to put America in the hands of the beliefs of a community college teacher that dedicated his book to Ron Paul.
> 
> Many scholars attribute the events that became the Great Depression to Hoover signing the Smoot-Hawley Tariff Act, even though he opposed it...it caused American exports and imports to plunge by more than half.
> 
> I am glad Obama is President...I can't imagine where we'd be with McCain in that office.
Click to expand...


Community college teacher that dedicated his book to Ron Paul?

Yes, Hoover's interventionism certainly made what might have been a small recession the Great Depression, that's kind of my point.

If McCain were in office I'd guess that he'd be doing the same nonsense that Obama is doing.


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> You're falling into the Chicken Little trap.  The sky wouldn't fall.  Things wouldn't be great, but after a year or so we'd be back where we want to be.  Now, however, we're just prolonging the agony.  So you say I have no compassion because I want to get out of this recession quickly, but the interventions you support are simply making everything worse.  So who really has no compassion?
> 
> 
> 
> 
> Well Kevin, you could be right, BUT the stakes are EXTREMELY high...and IF you ARE wrong, there will be a lot less Americans and possibly no America. The economy in this country was much different in 1921 and 1929. There are just way too many factors to examine to make oversimplified statements...
> 
> I'm not willing to put America in the hands of the beliefs of a community college teacher that dedicated his book to Ron Paul.
> 
> Many scholars attribute the events that became the Great Depression to Hoover signing the Smoot-Hawley Tariff Act, even though he opposed it...it caused American exports and imports to plunge by more than half.
> 
> I am glad Obama is President...I can't imagine where we'd be with McCain in that office.
> 
> Click to expand...
> 
> 
> Community college teacher that dedicated his book to Ron Paul?
> 
> Yes, Hoover's interventionism certainly made what might have been a small recession the Great Depression, that's kind of my point.
> 
> If McCain were in office I'd guess that he'd be doing the same nonsense that Obama is doing.
Click to expand...


Thomas Woods...

Judging by the GOP rhetoric I doubt McCain would do anything but make Bush's tax cuts to the elite permanent...

There would be no GM or Chrysler and 3 - 4 million MORE unemployed...

It would effect the foreign based domestic manufacturing because the demise of GM and Chrysler would mean the demise of MANY suppliers, the SAME suppliers Toyota etc rely on.

The problem is Kevin, unemployed people don't evaporate...they go from tax PAYERS to a burden on the taxpayers...


----------



## Kevin_Kennedy

Bfgrn said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> Well Kevin, you could be right, BUT the stakes are EXTREMELY high...and IF you ARE wrong, there will be a lot less Americans and possibly no America. The economy in this country was much different in 1921 and 1929. There are just way too many factors to examine to make oversimplified statements...
> 
> I'm not willing to put America in the hands of the beliefs of a community college teacher that dedicated his book to Ron Paul.
> 
> Many scholars attribute the events that became the Great Depression to Hoover signing the Smoot-Hawley Tariff Act, even though he opposed it...it caused American exports and imports to plunge by more than half.
> 
> I am glad Obama is President...I can't imagine where we'd be with McCain in that office.
> 
> 
> 
> 
> Community college teacher that dedicated his book to Ron Paul?
> 
> Yes, Hoover's interventionism certainly made what might have been a small recession the Great Depression, that's kind of my point.
> 
> If McCain were in office I'd guess that he'd be doing the same nonsense that Obama is doing.
> 
> Click to expand...
> 
> 
> Thomas Woods...
> 
> Judging by the GOP rhetoric I doubt McCain would do anything but make Bush's tax cuts to the elite permanent...
> 
> There would be no GM or Chrysler and 3 - 4 million MORE unemployed...
> 
> It would effect the foreign based domestic manufacturing because the demise of GM and Chrysler would mean the demise of MANY suppliers, the SAME suppliers Toyota etc rely on.
> 
> The problem is Kevin, unemployed people don't evaporate...they go from tax PAYERS to a burden on the taxpayers...
Click to expand...


Do you not remember McCain supporting the initial bailouts?  I have no doubt he'd be doing the same things as Obama.

GM and Chrysler are apparently going to end up bankrupt despite our having bailed them out, so that may not be your best example.

No one is saying unemployed people evaporate.  But would you rather have a 1 year turnaround or have a 15 year depression?  The answer is obvious.  Let the market correct itself.


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Community college teacher that dedicated his book to Ron Paul?
> 
> Yes, Hoover's interventionism certainly made what might have been a small recession the Great Depression, that's kind of my point.
> 
> If McCain were in office I'd guess that he'd be doing the same nonsense that Obama is doing.
> 
> 
> 
> 
> Thomas Woods...
> 
> Judging by the GOP rhetoric I doubt McCain would do anything but make Bush's tax cuts to the elite permanent...
> 
> There would be no GM or Chrysler and 3 - 4 million MORE unemployed...
> 
> It would effect the foreign based domestic manufacturing because the demise of GM and Chrysler would mean the demise of MANY suppliers, the SAME suppliers Toyota etc rely on.
> 
> The problem is Kevin, unemployed people don't evaporate...they go from tax PAYERS to a burden on the taxpayers...
> 
> Click to expand...
> 
> 
> Do you not remember McCain supporting the initial bailouts?  I have no doubt he'd be doing the same things as Obama.
> 
> GM and Chrysler are apparently going to end up bankrupt despite our having bailed them out, so that may not be your best example.
> 
> No one is saying unemployed people evaporate.  But would you rather have a 1 year turnaround or have a 15 year depression?  The answer is obvious.  Let the market correct itself.
Click to expand...


Kevin...the choice would be obvious, but I guess what I say goes in one ear and out the other...because you are assuming a LOT...you are putting all your faith in what is probably partisan spin on something that happened in 1921. IF the solution were THAT simple, then it wouldn't be obscure history or debated here. It is conjecture from ideologues... 

HOW is the "market" going to correct itself Kevin...explain the mechanics...

IMO, President Obama is on the right track going after lobbyists and special interests... they are the ones that have rigged the "market" in their favor to the detriment of you, me and the American people...


----------



## Kevin_Kennedy

Bfgrn said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> Thomas Woods...
> 
> Judging by the GOP rhetoric I doubt McCain would do anything but make Bush's tax cuts to the elite permanent...
> 
> There would be no GM or Chrysler and 3 - 4 million MORE unemployed...
> 
> It would effect the foreign based domestic manufacturing because the demise of GM and Chrysler would mean the demise of MANY suppliers, the SAME suppliers Toyota etc rely on.
> 
> The problem is Kevin, unemployed people don't evaporate...they go from tax PAYERS to a burden on the taxpayers...
> 
> 
> 
> 
> Do you not remember McCain supporting the initial bailouts?  I have no doubt he'd be doing the same things as Obama.
> 
> GM and Chrysler are apparently going to end up bankrupt despite our having bailed them out, so that may not be your best example.
> 
> No one is saying unemployed people evaporate.  But would you rather have a 1 year turnaround or have a 15 year depression?  The answer is obvious.  Let the market correct itself.
> 
> Click to expand...
> 
> 
> Kevin...the choice would be obvious, but I guess what I say goes in one ear and out the other...because you are assuming a LOT...you are putting all your faith in what is probably partisan spin on something that happened in 1921. IF the solution were THAT simple, then it wouldn't be obscure history or debated here. It is conjecture from ideologues...
> 
> HOW is the "market" going to correct itself Kevin...explain the mechanics...
> 
> IMO, President Obama is on the right track going after lobbyists and special interests... they are the ones that have rigged the "market" in their favor to the detriment of you, me and the American people...
Click to expand...


The market corrects itself by liquidating firms that are wasting resources and destroying wealth.  They then reallocate those resources, capital, labor, natural resources, etc..., to more viable firms.  Propping up businesses that are wasting resources and destroying wealth is harmful to the economy because you're just sinking more resources into destructive avenues.


----------



## Iriemon

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Garinold said:
> 
> 
> 
> Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.
> 
> 
> 
> 
> This has turned into a pea brain conversation...
> 
> First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
> 
> Second, WWII ended the depression...war IS government spending at at HUGE rate.
> 
> Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
> 
> It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
> 
> Right wing solutions are fucking great...if ONLY people would evaporate!
> 
> During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: &#8220;People don&#8217;t eat in the long run. They eat every day.&#8221;
> 
> http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
> 
> Click to expand...
> 
> 
> If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
> 
> Government spending can only hurt the economy, not help it.  Read Bastiat's _That Which is Seen, and That Which is Not Seen._
Click to expand...


The 1920 recession was totally different than 1929, or 2008.  

The 1920 recession was a post war recession, as industry de-tooled from the production of WWI and tooled back up for domestic production.  It was not a recession characterized by massive asset price deflations, bank failures, panic and fear with the associate hoarding of money.  1920 was very minor and as industry tooled back into domestic production, the economy went back on its way.

1929 was a totally different creature.  The crashing stock market wiped out huge sums of wealth and panic gripe the nations as runs made on banks caused them to fail.  People hoarded their money, didn't spend, and to maintain the gold standards, the Fed had to raise interest rates in 1930 making credit even tighter.  A spiral of fear ensued as more fear and panic led to less credit, less spending, less production, and then more unemployment starting another round of the downward cycle.

Other than foolishly raise tarriffs and the Fed raising the intererst rates, the Govt did marginal intervention for three years as the spiral continued, wiping out 40% of economic production and putting 25% of the labor force out of work.

2008 is a lot more like 1929 than 1920.  This is no postwar retooling recession, but a financial catastrophe caused by wholesale miscalculation of riks associated with mortgage investments.  Like the great depression, it has caused a major freeze in the credit markets, and without the financial bailout, would have brought down the biggest financial institutions that unfortunately dominate the financial markets which would have lead to a catastrophe that would cost a lot more than the money being spent now.

Risking our financial system and economy on a misplaced comparison to a completely different type of economic phenonema would be foolishly risky, from what I see of it.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> This has turned into a pea brain conversation...
> 
> First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
> 
> Second, WWII ended the depression...war IS government spending at at HUGE rate.
> 
> Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
> 
> It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
> 
> Right wing solutions are fucking great...if ONLY people would evaporate!
> 
> During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
> 
> http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
> 
> 
> 
> 
> If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
> 
> Government spending can only hurt the economy, not help it.  Read Bastiat's _That Which is Seen, and That Which is Not Seen._
> 
> Click to expand...
> 
> 
> The 1920 recession was totally different than 1929, or 2008.
> 
> The 1920 recession was a post war recession, as industry de-tooled from the production of WWI and tooled back up for domestic production.  It was not a recession characterized by massive asset price deflations, bank failures, panic and fear with the associate hoarding of money.  1920 was very minor and as industry tooled back into domestic production, the economy went back on its way.
> 
> 1929 was a totally different creature.  The crashing stock market wiped out huge sums of wealth and panic gripe the nations as runs made on banks caused them to fail.  People hoarded their money, didn't spend, and to maintain the gold standards, the Fed had to raise interest rates in 1930 making credit even tighter.  A spiral of fear ensued as more fear and panic led to less credit, less spending, less production, and then more unemployment starting another round of the downward cycle.
> 
> Other than foolishly raise tarriffs and the Fed raising the intererst rates, the Govt did marginal intervention for three years as the spiral continued, wiping out 40% of economic production and putting 25% of the labor force out of work.
> 
> 2008 is a lot more like 1929 than 1920.  This is no postwar retooling recession, but a financial catastrophe caused by wholesale miscalculation of riks associated with mortgage investments.  Like the great depression, it has caused a major freeze in the credit markets, and without the financial bailout, would have brought down the biggest financial institutions that unfortunately dominate the financial markets which would have lead to a catastrophe that would cost a lot more than the money being spent now.
> 
> Risking our financial system and economy on a misplaced comparison to a completely different type of economic phenonema would be foolishly risky, from what I see of it.
Click to expand...


The same principle applies.  You need to allow the market to correct itself, which as we saw in 1920 - 1921, is clearly the correct answer.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
> 
> Government spending can only hurt the economy, not help it.  Read Bastiat's _That Which is Seen, and That Which is Not Seen._
> 
> 
> 
> 
> The 1920 recession was totally different than 1929, or 2008.
> 
> The 1920 recession was a post war recession, as industry de-tooled from the production of WWI and tooled back up for domestic production.  It was not a recession characterized by massive asset price deflations, bank failures, panic and fear with the associate hoarding of money.  1920 was very minor and as industry tooled back into domestic production, the economy went back on its way.
> 
> 1929 was a totally different creature.  The crashing stock market wiped out huge sums of wealth and panic gripe the nations as runs made on banks caused them to fail.  People hoarded their money, didn't spend, and to maintain the gold standards, the Fed had to raise interest rates in 1930 making credit even tighter.  A spiral of fear ensued as more fear and panic led to less credit, less spending, less production, and then more unemployment starting another round of the downward cycle.
> 
> Other than foolishly raise tarriffs and the Fed raising the intererst rates, the Govt did marginal intervention for three years as the spiral continued, wiping out 40% of economic production and putting 25% of the labor force out of work.
> 
> 2008 is a lot more like 1929 than 1920.  This is no postwar retooling recession, but a financial catastrophe caused by wholesale miscalculation of riks associated with mortgage investments.  Like the great depression, it has caused a major freeze in the credit markets, and without the financial bailout, would have brought down the biggest financial institutions that unfortunately dominate the financial markets which would have lead to a catastrophe that would cost a lot more than the money being spent now.
> 
> Risking our financial system and economy on a misplaced comparison to a completely different type of economic phenonema would be foolishly risky, from what I see of it.
> 
> Click to expand...
> 
> 
> The same principle applies.  You need to allow the market to correct itself, which as we saw in 1920 - 1921, is clearly the correct answer.
Click to expand...


We saw how clearly correct that answer was in 1929.

We've discussed this before.  I don't share you let the economy go down the toilet philosophy.  Maybe they do at Mises.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> The 1920 recession was totally different than 1929, or 2008.
> 
> The 1920 recession was a post war recession, as industry de-tooled from the production of WWI and tooled back up for domestic production.  It was not a recession characterized by massive asset price deflations, bank failures, panic and fear with the associate hoarding of money.  1920 was very minor and as industry tooled back into domestic production, the economy went back on its way.
> 
> 1929 was a totally different creature.  The crashing stock market wiped out huge sums of wealth and panic gripe the nations as runs made on banks caused them to fail.  People hoarded their money, didn't spend, and to maintain the gold standards, the Fed had to raise interest rates in 1930 making credit even tighter.  A spiral of fear ensued as more fear and panic led to less credit, less spending, less production, and then more unemployment starting another round of the downward cycle.
> 
> Other than foolishly raise tarriffs and the Fed raising the intererst rates, the Govt did marginal intervention for three years as the spiral continued, wiping out 40% of economic production and putting 25% of the labor force out of work.
> 
> 2008 is a lot more like 1929 than 1920.  This is no postwar retooling recession, but a financial catastrophe caused by wholesale miscalculation of riks associated with mortgage investments.  Like the great depression, it has caused a major freeze in the credit markets, and without the financial bailout, would have brought down the biggest financial institutions that unfortunately dominate the financial markets which would have lead to a catastrophe that would cost a lot more than the money being spent now.
> 
> Risking our financial system and economy on a misplaced comparison to a completely different type of economic phenonema would be foolishly risky, from what I see of it.
> 
> 
> 
> 
> The same principle applies.  You need to allow the market to correct itself, which as we saw in 1920 - 1921, is clearly the correct answer.
> 
> Click to expand...
> 
> 
> We saw how clearly correct that answer was in 1929.
> 
> We've discussed this before.  I don't share you let the economy go down the toilet philosophy.  Maybe they do at Mises.
Click to expand...


No, we didn't.  Hoover and FDR were interventionists.

I don't share your "Let's make the situation worse so everybody can suffer for longer" philosophy.  Maybe Paul Krugman does.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> The same principle applies.  You need to allow the market to correct itself, which as we saw in 1920 - 1921, is clearly the correct answer.
> 
> 
> 
> 
> We saw how clearly correct that answer was in 1929.
> 
> We've discussed this before.  I don't share you let the economy go down the toilet philosophy.  Maybe they do at Mises.
> 
> Click to expand...
> 
> 
> No, we didn't.  Hoover and FDR were interventionists.
> 
> I don't share your "Let's make the situation worse so everybody can suffer for longer" philosophy.  Maybe Paul Krugman does.
Click to expand...


You'd have a point, if the stimulus bill caused the credit freeze, mortgage crash, and recession.  That stuff all happened before there was any thought of a stimulus bill.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> We saw how clearly correct that answer was in 1929.
> 
> We've discussed this before.  I don't share you let the economy go down the toilet philosophy.  Maybe they do at Mises.
> 
> 
> 
> 
> No, we didn't.  Hoover and FDR were interventionists.
> 
> I don't share your "Let's make the situation worse so everybody can suffer for longer" philosophy.  Maybe Paul Krugman does.
> 
> Click to expand...
> 
> 
> You'd have a point, if the stimulus bill caused the credit freeze, mortgage crash, and recession.  That stuff all happened before there was any thought of a stimulus bill.
Click to expand...


Yes, the downturn came before the stimulus no doubt, but that doesn't change the fact that its only going to make the situation worse.


----------



## editec

DiveCon said:


> editec said:
> 
> 
> 
> 
> 
> DiveCon said:
> 
> 
> 
> actually, it is supported by the facts
> you just refuse to admit it because it doesnt fit your political agenda
> 
> 
> 
> 
> Okay, it was your assertion, so it's up to you to prove it.
> 
> *What was the level of debt racked up by the consuming class in 1929?*
> 
> *What percentage of the GDP could be attributed to consumer debt?*
> 
> *How does that compare to todays debt ratios?*
> 
> Click to expand...
> 
> 
> 
> 
> 
> back then they could buy stock with only 10% secured funding
> the other 90% was borrowed
> it wasnt so much the consumer class as the investor class
> thats what you either forget or are willfully ignoring
> 
> Click to expand...
> 
> 
> 
> In other words you just agreed with what I'd originally said...that the debt load of consumers was not the cause of the depression.
> 
> Okay fine we agree.
> 
> 
> 
> 
> and my post was refering to today, not 1929
> but, almost the same thing happened today with people buying beyond their means to repay
> 
> Click to expand...
> 
> 
> 
> This thread is about the 1929 depression
> 
> 
> 
> 
> but go ahead and completely ignore those facts
> 
> Click to expand...
> 
> 
> Try making your point clearly next time, then.
Click to expand...


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> No, we didn't.  Hoover and FDR were interventionists.
> 
> I don't share your "Let's make the situation worse so everybody can suffer for longer" philosophy.  Maybe Paul Krugman does.
> 
> 
> 
> 
> You'd have a point, if the stimulus bill caused the credit freeze, mortgage crash, and recession.  That stuff all happened before there was any thought of a stimulus bill.
> 
> Click to expand...
> 
> 
> Yes, the downturn came before the stimulus no doubt, but that doesn't change the fact that its only going to make the situation worse.
Click to expand...


That is only because in your view, any Govt action is "worse".  I view the collapse of the banking system, auto manufacturing and other segments of the economy dragging us into a depression as "worse".


----------



## editec

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> You'd have a point, if the stimulus bill caused the credit freeze, mortgage crash, and recession. That stuff all happened before there was any thought of a stimulus bill.
> 
> 
> 
> 
> Yes, the downturn came before the stimulus no doubt, but that doesn't change the fact that its only going to make the situation worse.
> 
> Click to expand...
> 
> 
> That is only because in your view, any Govt action is "worse". I view the collapse of the banking system, auto manufacturing and other segments of the economy dragging us into a depression as "worse".
Click to expand...

 
Of course it would have been worse.

But Kevin doesn't believe that that's what would have happened.

He believes that we'd have had some hard times, then the market would have slowly evolved without intervention by the government.

I think he's wrong. 

I think has they done nothing, then tens-of-thousands of banks, probably the entire banking system would have collapsed, and the government would have been on the hooks for lord only know how much money thanks to FDIC.

I wish somebody who actually understood economic better than any of us would give us the step by step scenario of how that collapse might have happened.

That might do much to help us determine if the course of action taken by Bush II and Obama was overreacting or not.

Because we have two choices in this matter:

1. We can believe that this is a gigantic conspiracy involving economists and pols from both side of the aisle who are lying to us, or

2. We can believe that they are telling us the truth and had the government done nothing our economic banking system would have melted down and every bank in American would have gone insolvent.

Those are really the only choices we have about what happened, as far as I understand this event.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> You'd have a point, if the stimulus bill caused the credit freeze, mortgage crash, and recession.  That stuff all happened before there was any thought of a stimulus bill.
> 
> 
> 
> 
> Yes, the downturn came before the stimulus no doubt, but that doesn't change the fact that its only going to make the situation worse.
> 
> Click to expand...
> 
> 
> That is only because in your view, any Govt action is "worse".  I view the collapse of the banking system, auto manufacturing and other segments of the economy dragging us into a depression as "worse".
Click to expand...


Those segments are dragging us into a depression regardless, the only difference is we're now trying to prop up these zombie-businesses and its causing our downturn to last longer and effect more people than it needs to.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Yes, the downturn came before the stimulus no doubt, but that doesn't change the fact that its only going to make the situation worse.
> 
> 
> 
> 
> That is only because in your view, any Govt action is "worse".  I view the collapse of the banking system, auto manufacturing and other segments of the economy dragging us into a depression as "worse".
> 
> Click to expand...
> 
> 
> Those segments are dragging us into a depression regardless, the only difference is we're now trying to prop up these zombie-businesses and its causing our downturn to last longer and effect more people than it needs to.
Click to expand...


I draw a distinction between a business that fails because it is in a noncompetitive business versus one that is failing because of a correctable error, or because of unusual market conditions.

If an otherwise sound, profitable company that relies on working capital loans is failing only because its access to capital was cut off because of the financial crises, I personally do not see the benefit of letting companies like that fail simply because of unforseeable conditions associate with the credit seizure.  

In that situation, letting these companies go out of business does nothing more that destroy wealth and economic capacity.  It create more unemployment, decreases demand, and continues the spiral of creating even more "zombie" businesses simply because of the negative cycle.  IMO that is not good for the country, and letting such companies die unnaturally prolongs the recession or creates a depression.

You can argue that some companies were not sustainable anyway.  But the undisputable fact is that many companies, including the automakers, and in bad trouble now solely because of the severe recession we are facing.  But for this recession no one would be talking about GM and Chysler going bankrupt, not to mention all the other businesses.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> That is only because in your view, any Govt action is "worse".  I view the collapse of the banking system, auto manufacturing and other segments of the economy dragging us into a depression as "worse".
> 
> 
> 
> 
> Those segments are dragging us into a depression regardless, the only difference is we're now trying to prop up these zombie-businesses and its causing our downturn to last longer and effect more people than it needs to.
> 
> Click to expand...
> 
> 
> I draw a distinction between a business that fails because it is in a noncompetitive business versus one that is failing because of a correctable error, or because of unusual market conditions.
> 
> If an otherwise sound, profitable company that relies on working capital loans is failing only because its access to capital was cut off because of the financial crises, I personally do not see the benefit of letting companies like that fail simply because of unforseeable conditions associate with the credit seizure.
> 
> In that situation, letting these companies go out of business does nothing more that destroy wealth and economic capacity.  It create more unemployment, decreases demand, and continues the spiral of creating even more "zombie" businesses simply because of the negative cycle.  IMO that is not good for the country, and letting such companies die unnaturally prolongs the recession or creates a depression.
> 
> You can argue that some companies were not sustainable anyway.  But the undisputable fact is that many companies, including the automakers, and in bad trouble now solely because of the severe recession we are facing.  But for this recession no one would be talking about GM and Chysler going bankrupt, not to mention all the other businesses.
Click to expand...


The unusual market conditions you speak of, or should be speaking of rather, is the boom period.  That's when all these companies seem to be sustainable and they expand and hire and everything appears to be great.  However, once the bust period, which is where we're at now, it becomes apparent very quickly that what they're doing is not sustainable and they have to go out of business.  Yes, they're going out of business because of the recession, but that's exactly what the recession is.  It's the period where the market attempts to reallocate resources from insolvent businesses to more viable ones.  The recession is painful, but it serves as a cleansing process to weed out wealth destroyers.  By propping up these black-hole businesses you're simply allowing more resources and wealth to be destroyed.  If the market is attempting to liquidate a business then it wasn't sustainable, period.

The auto-companies were having problems *long* before this crisis hit.  I worked at a Chevrolet dealership a few years ago that went out of business, and I can assure you that their problems were not just these past few months in the making.


----------



## Bfgrn

The recession is painful, but it serves as a cleansing process...

So did Hitler's eugenics programs...

The problem Kevin is the economy was NOT sound for most American citizens. The middle class has been sinking for many years...that why the average credit card debt is $8,000 per household...

The government intervention over the last decade has been to rig the market FOR corporations and against the individual citizens...we ARE a corporatocracy...

Obama has the right approach...

"Harry Truman once said, 'There are 14 or 15 million Americans who have the resources to have representatives in Washington to protect their interests, and that the interests of the great mass of the other people - the 150 or 160 million - is the responsibility of the president of the United States, and I propose to fulfill it.'"
*President John F. Kennedy*


----------



## Yukon

Adolph Hitler had more impact on the world than any other person in history. Too bad you can't reconize that fact...quite sad actually.


----------



## Kevin_Kennedy

Bfgrn said:


> The recession is painful, but it serves as a cleansing process...
> 
> So did Hitler's eugenics programs...
> 
> The problem Kevin is the economy was NOT sound for most American citizens. The middle class has been sinking for many years...that why the average credit card debt is $8,000 per household...
> 
> The government intervention over the last decade has been to rig the market FOR corporations and against the individual citizens...we ARE a corporatocracy...
> 
> Obama has the right approach...
> 
> "Harry Truman once said, 'There are 14 or 15 million Americans who have the resources to have representatives in Washington to protect their interests, and that the interests of the great mass of the other people - the 150 or 160 million - is the responsibility of the president of the United States, and I propose to fulfill it.'"
> *President John F. Kennedy*



The difference between Hitler and I is that I'm not advocating for genocide, I'm advocating that the government not waste our money on trying to keep failed businesses viable because it makes the problem worse.

I never said the economy was sound.

Obama does not have the right approach.  He's rigging the market for the corporations by taking from the citizens to keep them in business when they failed.


----------



## Old Rocks

Midnight Marauder said:


> Gunny said:
> 
> 
> 
> 
> 
> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> A better question ... Why is something from the 1930s posted in Current Events?
> 
> Click to expand...
> 
> Because most of the brain-dead public at large has drank the kool-aid that today's economic situation is somehow analogous to the depression of the 30s. It's not.
> 
> It's the Goebbels factor: say it loud enough and long enough and gullible people will just accept it as fact.
Click to expand...


I see. Then all the companies that we have seen going down the tube are just an illusion? I work in the steel industry, and the line for steel production for the fourth quarter of 2008 looks like a cliff. 

No, we have a very analogous situation to the First Great Republican Depression. Even down to it's causes.


----------



## Old Rocks

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> The recession is painful, but it serves as a cleansing process...
> 
> So did Hitler's eugenics programs...
> 
> The problem Kevin is the economy was NOT sound for most American citizens. The middle class has been sinking for many years...that why the average credit card debt is $8,000 per household...
> 
> The government intervention over the last decade has been to rig the market FOR corporations and against the individual citizens...we ARE a corporatocracy...
> 
> Obama has the right approach...
> 
> "Harry Truman once said, 'There are 14 or 15 million Americans who have the resources to have representatives in Washington to protect their interests, and that the interests of the great mass of the other people - the 150 or 160 million - is the responsibility of the president of the United States, and I propose to fulfill it.'"
> *President John F. Kennedy*
> 
> 
> 
> 
> The difference between Hitler and I is that I'm not advocating for genocide, I'm advocating that the government not waste our money on trying to keep failed businesses viable because it makes the problem worse.
> 
> I never said the economy was sound.
> 
> Obama does not have the right approach.  He's rigging the market for the corporations by taking from the citizens to keep them in business when they failed.
Click to expand...


I really hate to see us spending money to bail out the people that got us into this situation. But even more, I hate to think of what it would be like were we not making a concerted effort to prevent the Second Great Republican Depression. 

As for your ideologically based economic theory goes, we did little in the First Great Republican Depression, and we suffered for it. Better proactive.


----------



## Kevin_Kennedy

Old Rocks said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> The recession is painful, but it serves as a cleansing process...
> 
> So did Hitler's eugenics programs...
> 
> The problem Kevin is the economy was NOT sound for most American citizens. The middle class has been sinking for many years...that why the average credit card debt is $8,000 per household...
> 
> The government intervention over the last decade has been to rig the market FOR corporations and against the individual citizens...we ARE a corporatocracy...
> 
> Obama has the right approach...
> 
> "Harry Truman once said, 'There are 14 or 15 million Americans who have the resources to have representatives in Washington to protect their interests, and that the interests of the great mass of the other people - the 150 or 160 million - is the responsibility of the president of the United States, and I propose to fulfill it.'"
> *President John F. Kennedy*
> 
> 
> 
> 
> The difference between Hitler and I is that I'm not advocating for genocide, I'm advocating that the government not waste our money on trying to keep failed businesses viable because it makes the problem worse.
> 
> I never said the economy was sound.
> 
> Obama does not have the right approach.  He's rigging the market for the corporations by taking from the citizens to keep them in business when they failed.
> 
> Click to expand...
> 
> 
> I really hate to see us spending money to bail out the people that got us into this situation. But even more, I hate to think of what it would be like were we not making a concerted effort to prevent the Second Great Republican Depression.
> 
> As for your ideologically based economic theory goes, we did little in the First Great Republican Depression, and we suffered for it. Better proactive.
Click to expand...


Incorrect.


----------



## mash107

Old Rocks said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> The recession is painful, but it serves as a cleansing process...
> 
> So did Hitler's eugenics programs...
> 
> The problem Kevin is the economy was NOT sound for most American citizens. The middle class has been sinking for many years...that why the average credit card debt is $8,000 per household...
> 
> The government intervention over the last decade has been to rig the market FOR corporations and against the individual citizens...we ARE a corporatocracy...
> 
> Obama has the right approach...
> 
> "Harry Truman once said, 'There are 14 or 15 million Americans who have the resources to have representatives in Washington to protect their interests, and that the interests of the great mass of the other people - the 150 or 160 million - is the responsibility of the president of the United States, and I propose to fulfill it.'"
> *President John F. Kennedy*
> 
> 
> 
> 
> The difference between Hitler and I is that I'm not advocating for genocide, I'm advocating that the government not waste our money on trying to keep failed businesses viable because it makes the problem worse.
> 
> I never said the economy was sound.
> 
> Obama does not have the right approach.  He's rigging the market for the corporations by taking from the citizens to keep them in business when they failed.
> 
> Click to expand...
> 
> 
> I really hate to see us spending money to bail out the people that got us into this situation. But even more, I hate to think of what it would be like were we not making a concerted effort to prevent the Second Great Republican Depression.
> 
> As for your ideologically based economic theory goes, we did little in the First Great Republican Depression, and we suffered for it. Better proactive.
Click to expand...


We were inactive during the first depression of the 20th century in 1921, and it lasted two years.

We were *extremely* proactive during the second depression, and it lasted 15. Hoover enacted wage and price controls, causing skyrocketing unemployment. I posted this quote elsewhere, but Hoover even said, "we might have done nothing. That would have been utter ruin. *Instead we met the situation with proposals to private business and to Congress of the most gigantic program of economic defense and counterattack ever evolved in the history of the Republic.* We put it into action. . . . No government in Washington has hitherto considered that it held so broad a responsibility for leadership in such times. . . . For the first time in the history of depression, dividends, profits, and the cost of living, have been reduced before wages have suffered. . . . They were maintained until the cost of living had decreased and the profits had practically vanished. They are now the highest real wages in the world." Hoover was as interventionist as FDR. End of story. Revisionist history can't change that.

Are you telling me you'd rather have people suffer for 15 years rather than 2?


----------



## editec

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
> 
> Government spending can only hurt the economy, not help it. Read Bastiat's _That Which is Seen, and That Which is Not Seen._
> 
> 
> 
> 
> No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
> 
> Join REALITY...
> 
> Click to expand...
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
Click to expand...

 
It keeps them ALIVE, Kevin.


----------



## mash107

editec said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
> 
> Join REALITY...
> 
> 
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
> 
> Click to expand...
> 
> 
> It keeps them ALIVE, Kevin.
Click to expand...


That's the propaganda that the elite want you to believe, editec. But in reality, It keeps them poor and dependent. Welfare is cruel beyond words.


----------



## Toro

mash107 said:


> editec said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
> 
> 
> 
> 
> It keeps them ALIVE, Kevin.
> 
> Click to expand...
> 
> 
> That's the propaganda that the elite want you to believe, editec. But in reality, It keeps them poor and dependent. Welfare is cruel beyond words.
Click to expand...


And that's propaganda the likes of Rush Limbaugh and Anne Coulter want you to believe.  People starving and living on the streets is cruel beyond words. 

The economic reality is most definitely not that government interventions prolongs economic downturns.  The only thing that has been keeping this economy afloat is the government. Otherwise, the collapse would have been far more severe.


----------



## Old Rocks

Toro said:


> mash107 said:
> 
> 
> 
> 
> 
> editec said:
> 
> 
> 
> It keeps them ALIVE, Kevin.
> 
> 
> 
> 
> That's the propaganda that the elite want you to believe, editec. But in reality, It keeps them poor and dependent. Welfare is cruel beyond words.
> 
> Click to expand...
> 
> 
> And that's propaganda the likes of Rush Limbaugh and Anne Coulter want you to believe.  People starving and living on the streets is cruel beyond words.
> 
> The economic reality is most definitely not that government interventions prolongs economic downturns.  The only thing that has been keeping this economy afloat is the government. Otherwise, the collapse would have been far more severe.
Click to expand...


But the wingnuts are still in an alternative reality. They continue to deny that this crisis is affecting even those that did everything right. In fact, some of those are worse affected. A man I work with, a legal immigrant, from the time he entered this country, worked hard, saved, put the maximum in his 401-K, and owned only the home he could afford, took few vacations, generally did all that the economic gurus claim is correct. His total loss to this point is over 70%. He is now working 32 hrs a week, and will probably be laid off for two months after June. 

Had he spent, cash, some of that money on luxeries that he saved, at least he would have had the enjoyment of those things, rather than giving his money to the people that effectively stole it from him for their luxeries.

It is not lazy people, people that overbought, or foolish people that are suffering now. Right across the board, it is small business owners, blue collar middle class, working poor, and people that work on commission. Businesses, big and small are crumbling, the only source of capital, right now, is the government. Without the programs that Obama, and, yes, Bush, put into effect to keep the economy afloat, we would now be in a full fledged Depression. A world wide Depression.


----------



## Kevin_Kennedy

editec said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
> 
> Join REALITY...
> 
> 
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
> 
> Click to expand...
> 
> 
> It keeps them ALIVE, Kevin.
Click to expand...


It prolongs the agony, which means the people have to suffer longer.

And to Old Rocks, none of us said it was these peoples fault or that they did something wrong.  It's the Federal Reserves fault with their easy money policies, these people are just victims.  But the fact is that prolonging the agony doesn't help these people whatsoever.


----------



## mash107

Toro said:


> mash107 said:
> 
> 
> 
> 
> 
> editec said:
> 
> 
> 
> It keeps them ALIVE, Kevin.
> 
> 
> 
> 
> That's the propaganda that the elite want you to believe, editec. But in reality, It keeps them poor and dependent. Welfare is cruel beyond words.
> 
> Click to expand...
> 
> 
> And that's propaganda the likes of Rush Limbaugh and Anne Coulter want you to believe.  People starving and living on the streets is cruel beyond words.
> 
> The economic reality is most definitely not that government interventions prolongs economic downturns.  The only thing that has been keeping this economy afloat is the government. Otherwise, the collapse would have been far more severe.
Click to expand...


When it is because of government they are starving and living on the streets, then I agree that is cruel. You claim to be an empiricist, and yet you don't look at the situation North Korea and Cuba are in and compare that with States that have less welfare, and draw the obvious conclusion. I don't care what Rush or Ann say, because they too were waving the Statist flag when Bush was in power. However, empiricism proves welfare impoverishes a certain group of people, while feeding another group of people.

For your dose of economic reality, let's again turn to empiricism. You would think after open market operations started in 1922 by the Federal Reserve that our recessions after interventions would be starkly less severe than those suffered prior to 1922. The worst recession prior to 1922 was encountered just two years before, with a deflationary spiral and all was resolved within a year or so, without government "intervention". However, the many recessions faced since have been drastically longer in duration and more severe in reduction of economic activity, not to mention occurring with increased frequency. Empiricism, once again, sides against intervention.


----------



## Toro

mash107 said:


> When it is because of government they are starving and living on the streets, then I agree that is cruel. You claim to be an empiricist, and yet you don't look at the situation North Korea and Cuba are in and compare that with States that have less welfare, and draw the obvious conclusion.



Comparing Cuba and Korea with America is like comparing Haiti with Sweden and concluding that capitalism doesn't work and social democracy does.



> For your dose of economic reality, let's again turn to empiricism. You would think after open market operations started in 1922 by the Federal Reserve that our recessions after interventions would be starkly less severe than those suffered prior to 1922. The worst recession prior to 1922 was encountered just two years before, with a deflationary spiral and all was resolved within a year or so, without government "intervention". However, the many recessions faced since have been drastically longer in duration and more severe in reduction of economic activity, not to mention occurring with increased frequency. Empiricism, once again, sides against intervention.



This is incorrect.  The economy was in recession for 363 months from December 1854 through July 1921.  That means the economy was in recession 44% of the time.  The average recession lasted 21 months.  There were 17 recessions during that time, or one every 4 years.  Up until 2002, the economy had been in recession 202 months since 1922, or 21% of the time.  The average recession lasted 13 months.  Since WWII, the average duration has been 10.4 months.  Recessions were also deeper before 1945, at least up until this one.  There were 15 recessions between 1922 and 2002, or one every 5.4 years.

Business Cycle Expansions and Contractions

Generally, crises are more frequent without central banks.

http://www.usmessageboard.com/economy/68521-why-we-have-the-fed-and-other-central-banks.html

The worst depression before the Great Depression was the depression that began in 1873.  Up until the 1930s, the term "Great Depression" was used for the depression that began in 1873.

Long Depression - Wikipedia, the free encyclopedia


----------



## Iriemon

mash107 said:


> Old Rocks said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> The difference between Hitler and I is that I'm not advocating for genocide, I'm advocating that the government not waste our money on trying to keep failed businesses viable because it makes the problem worse.
> 
> I never said the economy was sound.
> 
> Obama does not have the right approach.  He's rigging the market for the corporations by taking from the citizens to keep them in business when they failed.
> 
> 
> 
> 
> I really hate to see us spending money to bail out the people that got us into this situation. But even more, I hate to think of what it would be like were we not making a concerted effort to prevent the Second Great Republican Depression.
> 
> As for your ideologically based economic theory goes, we did little in the First Great Republican Depression, and we suffered for it. Better proactive.
> 
> Click to expand...
> 
> 
> We were inactive during the first depression of the 20th century in 1921, and it lasted two years.
Click to expand...


As was discussed earlierin the thread, 1920 wasn't a depression, but a mild post war retooling recession.  Altogether difference than 1929; or 2008.


----------



## Iriemon

mash107 said:


> editec said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
> 
> 
> 
> 
> It keeps them ALIVE, Kevin.
> 
> Click to expand...
> 
> 
> That's the propaganda that the elite want you to believe, editec. But in reality, It keeps them poor and dependent. Welfare is cruel beyond words.
Click to expand...


Poverty in the US dropped in half after the New Deal programs.


----------



## Iriemon

Kevin_Kennedy said:


> editec said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
> 
> 
> 
> 
> It keeps them ALIVE, Kevin.
> 
> Click to expand...
> 
> 
> It prolongs the agony, which means the people have to suffer longer.
Click to expand...


As opposed to what?  Letting them die?  I know that is not what you mean, but how is health care being provided to an aged or disabled person who can't work prolonging their agony?


----------



## Kevin_Kennedy

Iriemon said:


> mash107 said:
> 
> 
> 
> 
> 
> Old Rocks said:
> 
> 
> 
> I really hate to see us spending money to bail out the people that got us into this situation. But even more, I hate to think of what it would be like were we not making a concerted effort to prevent the Second Great Republican Depression.
> 
> As for your ideologically based economic theory goes, we did little in the First Great Republican Depression, and we suffered for it. Better proactive.
> 
> 
> 
> 
> We were inactive during the first depression of the 20th century in 1921, and it lasted two years.
> 
> Click to expand...
> 
> 
> As was discussed earlierin the thread, 1920 wasn't a depression, but a mild post war retooling recession.  Altogether difference than 1929; or 2008.
Click to expand...


I don't think there was anything mild about the recession of 1920.



> During and after World War I, the Federal Reserve inflated the money supply substantially. Once the Fed finally began to raise the discount ratethe rate at which it lends to banksthe economy slowed as it started readjusting to reality. By the middle of 1920, the downturn had become severe, with production falling by 21 percent over the next 12 months. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921.



The American Conservative -- The Harding Way


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> editec said:
> 
> 
> 
> It keeps them ALIVE, Kevin.
> 
> 
> 
> 
> It prolongs the agony, which means the people have to suffer longer.
> 
> Click to expand...
> 
> 
> As opposed to what?  Letting them die?  I know that is not what you mean, but how is health care being provided to an aged or disabled person who can't work prolonging their agony?
Click to expand...


Well the discussion wasn't necessarily about cutting healthcare, and I was speaking of the masses not one specific person who sees a benefit from some of these government programs.


----------



## Toro

Iriemon said:


> mash107 said:
> 
> 
> 
> 
> 
> Old Rocks said:
> 
> 
> 
> I really hate to see us spending money to bail out the people that got us into this situation. But even more, I hate to think of what it would be like were we not making a concerted effort to prevent the Second Great Republican Depression.
> 
> As for your ideologically based economic theory goes, we did little in the First Great Republican Depression, and we suffered for it. Better proactive.
> 
> 
> 
> 
> We were inactive during the first depression of the 20th century in 1921, and it lasted two years.
> 
> Click to expand...
> 
> 
> As was discussed earlierin the thread, 1920 wasn't a depression, but a mild post war retooling recession.  Altogether difference than 1929; or 2008.
Click to expand...


I'd disagree.  1920 was a fairly sharp recession.  Policy after WWII was implemented specifically to avoid a repeat of the recession after WWI.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> mash107 said:
> 
> 
> 
> We were inactive during the first depression of the 20th century in 1921, and it lasted two years.
> 
> 
> 
> 
> As was discussed earlierin the thread, 1920 wasn't a depression, but a mild post war retooling recession.  Altogether difference than 1929; or 2008.
> 
> Click to expand...
> 
> 
> I don't think there was anything mild about the recession of 1920.
> 
> 
> 
> 
> During and after World War I, the Federal Reserve inflated the money supply substantially. Once the Fed finally began to raise the discount rate&#8212;the rate at which it lends to banks&#8212;the economy slowed as it started readjusting to reality. By the middle of 1920, the downturn had become severe, with production falling by 21 percent over the next 12 months. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921.
> 
> Click to expand...
> 
> 
> The American Conservative -- The Harding Way
Click to expand...



Year  -  GDP 1929$
1919   $70,271
1920    71,383
1921    68,355
1922    73,150
1923    82,994
1924    85,222
1925    87,359
1926    93,438
1927    94,161
1928    95,715
1929   101,444
1930    91,513
1931    84,300
1932    70,682
1933    68,337
1934    74,609
1935    85,806
1936    95,798
1937   103,917

Real GDP and GNP

Real GDP fell 4% in the 1920 recession; it fell over 30% in the great depression.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> It prolongs the agony, which means the people have to suffer longer.
> 
> 
> 
> 
> As opposed to what?  Letting them die?  I know that is not what you mean, but how is health care being provided to an aged or disabled person who can't work prolonging their agony?
> 
> Click to expand...
> 
> 
> Well the discussion wasn't necessarily about cutting healthcare, and I was speaking of the masses not one specific person who sees a benefit from some of these government programs.
Click to expand...


So how does government programs that support the aged or disabled who can't work prolong their agony?


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> As was discussed earlierin the thread, 1920 wasn't a depression, but a mild post war retooling recession.  Altogether difference than 1929; or 2008.
> 
> 
> 
> 
> I don't think there was anything mild about the recession of 1920.
> 
> 
> 
> 
> During and after World War I, the Federal Reserve inflated the money supply substantially. Once the Fed finally began to raise the discount ratethe rate at which it lends to banksthe economy slowed as it started readjusting to reality. By the middle of 1920, the downturn had become severe, with production falling by 21 percent over the next 12 months. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921.
> 
> Click to expand...
> 
> 
> The American Conservative -- The Harding Way
> 
> Click to expand...
> 
> 
> 
> Year  -  GDP 1929$
> 1919   $70,271
> 1920    71,383
> 1921    68,355
> 1922    73,150
> 1923    82,994
> 1924    85,222
> 1925    87,359
> 1926    93,438
> 1927    94,161
> 1928    95,715
> 1929   101,444
> 1930    91,513
> 1931    84,300
> 1932    70,682
> 1933    68,337
> 1934    74,609
> 1935    85,806
> 1936    95,798
> 1937   103,917
> 
> Real GDP and GNP
> 
> Real GDP fell 4% in the 1920 recession; it fell over 30% in the great depression.
Click to expand...


I didn't say that the recession of 1920 was worse than the Great Depression, I merely stated that I would not consider it a mild recession.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> As opposed to what?  Letting them die?  I know that is not what you mean, but how is health care being provided to an aged or disabled person who can't work prolonging their agony?
> 
> 
> 
> 
> Well the discussion wasn't necessarily about cutting healthcare, and I was speaking of the masses not one specific person who sees a benefit from some of these government programs.
> 
> Click to expand...
> 
> 
> So how does government programs that support the aged or disabled who can't work prolong their agony?
Click to expand...


They may see some benefit out of the programs, however society as a whole may be worse off for the government sinking resources into those programs.  There are people who are going to see some benefit out of the stimulus package, like those who are going to be paid to do the infrastructure building and those who are receiving funds for whatever else.  However, the recession is going to be prolonged because of the stimulus.  Therefore, the rest of us are going to have to suffer longer because these companies who may not be solvent on their own are now being propped up by the government and are destroying wealth.


----------



## Old Rocks

The infrastructure built by those people is going to disappear after they are paid? We are still using facilities built by the CCCs and the WPA. The building of infrastructure is an investment, if done wisely, will pay back many times the money spent on it.

There are many companies that would have been destroyed, in spite of being managed well, by the lack of credit, had things been allowed to continue as they were last fall. Your ideology seems to blind you to reality.


----------



## Kevin_Kennedy

Old Rocks said:


> The infrastructure built by those people is going to disappear after they are paid? We are still using facilities built by the CCCs and the WPA. The building of infrastructure is an investment, if done wisely, will pay back many times the money spent on it.
> 
> There are many companies that would have been destroyed, in spite of being managed well, by the lack of credit, had things been allowed to continue as they were last fall. Your ideology seems to blind you to reality.



I would say your ideology blinds you to basic economics, but that would be rude.

At any rate, where in the world did you get the notion that I said the infrastructure is going to disappear?  No, that is completely absurd and I never said anything of the sort.


----------



## Bfgrn

Old Rocks said:


> The infrastructure built by those people is going to disappear after they are paid? We are still using facilities built by the CCCs and the WPA. The building of infrastructure is an investment, if done wisely, will pay back many times the money spent on it.
> 
> There are many companies that would have been destroyed, in spite of being managed well, by the lack of credit, had things been allowed to continue as they were last fall. Your ideology seems to blind you to reality.



Hey, AND that infrastructure improvement is beneficial to commerce...THE MARKET...

AND energy efficiency...less fuel burned in gridlock 

AND the environment...less emissions into the atmosphere

AND health care...less illness due to pollution exasperated diseases.

AND businesses...less sick days of workers affected by those diseases...

AND businesses...less worker tardiness...

AND businesses...less transportation costs = more profit

AND consumers...less transportation costs = lower prices

AND...


----------



## Kevin_Kennedy

Bfgrn said:


> Old Rocks said:
> 
> 
> 
> The infrastructure built by those people is going to disappear after they are paid? We are still using facilities built by the CCCs and the WPA. The building of infrastructure is an investment, if done wisely, will pay back many times the money spent on it.
> 
> There are many companies that would have been destroyed, in spite of being managed well, by the lack of credit, had things been allowed to continue as they were last fall. Your ideology seems to blind you to reality.
> 
> 
> 
> 
> Hey, AND that infrastructure improvement is beneficial to commerce...THE MARKET...
> 
> AND energy efficiency...less fuel burned in gridlock
> 
> AND the environment...less emissions into the atmosphere
> 
> AND health care...less illness due to pollution exasperated diseases.
> 
> AND businesses...less sick days of workers affected by those diseases...
> 
> AND businesses...less worker tardiness...
> 
> AND businesses...less transportation costs = more profit
> 
> AND consumers...less transportation costs = lower prices
> 
> AND...
Click to expand...


As I must continually remind so many of you, it doesn't matter if you agree with what the money is spent on or not as it is always harmful to the economy when the government takes money out of the private sector and reallocates it to where it does not belong.  Some people will benefit, that is to be sure.  But as Bastiat said, that is what is seen.  What is not seen are those who have been harmed as a result of this government reallocation of resources.  Perhaps that money, had the government not taken it, would have been spent on a book.  Thus, the bookstore suffers because the money was not available to be spent on a book because the government took it and spent it on infrastructure.


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Old Rocks said:
> 
> 
> 
> The infrastructure built by those people is going to disappear after they are paid? We are still using facilities built by the CCCs and the WPA. The building of infrastructure is an investment, if done wisely, will pay back many times the money spent on it.
> 
> There are many companies that would have been destroyed, in spite of being managed well, by the lack of credit, had things been allowed to continue as they were last fall. Your ideology seems to blind you to reality.
> 
> 
> 
> 
> Hey, AND that infrastructure improvement is beneficial to commerce...THE MARKET...
> 
> AND energy efficiency...less fuel burned in gridlock
> 
> AND the environment...less emissions into the atmosphere
> 
> AND health care...less illness due to pollution exasperated diseases.
> 
> AND businesses...less sick days of workers affected by those diseases...
> 
> AND businesses...less worker tardiness...
> 
> AND businesses...less transportation costs = more profit
> 
> AND consumers...less transportation costs = lower prices
> 
> AND...
> 
> Click to expand...
> 
> 
> As I must continually remind so many of you, it doesn't matter if you agree with what the money is spent on or not as it is always harmful to the economy when the government takes money out of the private sector and reallocates it to where it does not belong.  Some people will benefit, that is to be sure.  But as Bastiat said, that is what is seen.  What is not seen are those who have been harmed as a result of this government reallocation of resources.  Perhaps that money, had the government not taken it, would have been spent on a book.  Thus, the bookstore suffers because the money was not available to be spent on a book because the government took it and spent it on infrastructure.
Click to expand...


Kevin, you need to take a course in Civics... it is no longer taught in schools...which explains your lack of understanding HOW a society works...

THEN...read about the role of the private sector, as defined during our founding father's days...


----------



## Kevin_Kennedy

Bfgrn said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Bfgrn said:
> 
> 
> 
> Hey, AND that infrastructure improvement is beneficial to commerce...THE MARKET...
> 
> AND energy efficiency...less fuel burned in gridlock
> 
> AND the environment...less emissions into the atmosphere
> 
> AND health care...less illness due to pollution exasperated diseases.
> 
> AND businesses...less sick days of workers affected by those diseases...
> 
> AND businesses...less worker tardiness...
> 
> AND businesses...less transportation costs = more profit
> 
> AND consumers...less transportation costs = lower prices
> 
> AND...
> 
> 
> 
> 
> As I must continually remind so many of you, it doesn't matter if you agree with what the money is spent on or not as it is always harmful to the economy when the government takes money out of the private sector and reallocates it to where it does not belong.  Some people will benefit, that is to be sure.  But as Bastiat said, that is what is seen.  What is not seen are those who have been harmed as a result of this government reallocation of resources.  Perhaps that money, had the government not taken it, would have been spent on a book.  Thus, the bookstore suffers because the money was not available to be spent on a book because the government took it and spent it on infrastructure.
> 
> Click to expand...
> 
> 
> Kevin, you need to take a course in Civics... it is no longer taught in schools...which explains your lack of understanding HOW a society works...
> 
> THEN...read about the role of the private sector, as defined during our founding father's days...
Click to expand...


Please enlighten me as to what you think I'm missing, since you say I lack some concept of understanding that you possess.


----------



## Bfgrn

Kevin_Kennedy said:


> Bfgrn said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> As I must continually remind so many of you, it doesn't matter if you agree with what the money is spent on or not as it is always harmful to the economy when the government takes money out of the private sector and reallocates it to where it does not belong.  Some people will benefit, that is to be sure.  But as Bastiat said, that is what is seen.  What is not seen are those who have been harmed as a result of this government reallocation of resources.  Perhaps that money, had the government not taken it, would have been spent on a book.  Thus, the bookstore suffers because the money was not available to be spent on a book because the government took it and spent it on infrastructure.
> 
> 
> 
> 
> Kevin, you need to take a course in Civics... it is no longer taught in schools...which explains your lack of understanding HOW a society works...
> 
> THEN...read about the role of the private sector, as defined during our founding father's days...
> 
> Click to expand...
> 
> 
> Please enlighten me as to what you think I'm missing, since you say I lack some concept of understanding that you possess.
Click to expand...



The main concept you're missing is a sound understanding of human nature. The recent economic tsunami, where unregulated greed proved the market can NOT operate without rules, oversight and regulations should be clear to you Kev. 

The second; that our founding fathers designed a government OF and FOR people; individuals, not corporations.

The Boston Tea Party was as much a rebellion against corporations as it was a rebellion against oppressive government...

Nowhere in the Constitution is the word "corporation," for the writers had no interest in using for-profit corporations to run their new government. In colonial times, corporations were tools of the king's oppression, chartered for the purpose of exploiting the so-called "New World" and shoveling wealth back into Europe. The rich formed joint-stock corporations to distribute the enormous risk of colonizing the Americas and gave them names like the Hudson Bay Company, the British East India Company, and the Massachusetts Bay Colony. Because they were so far from their sovereign - the king - the agents for these corporations had a lot of autonomy to do their work; they could pass laws, levy taxes, and even raise armies to manage and control property and commerce. They were not popular with the colonists.

So the Constitution's authors left control of corporations to state legislatures (10th Amendment), where they would get the closest supervision by the people. Early corporate charters were explicit about what a corporation could do, how, for how long, with whom, where, and when. Corporations could not own stock in other corporations, and they were prohibited from any part of the political process. Individual stockholders were held personally liable for any harms done in the name of the corporation, and most charters only lasted for 10 or 15 years. But most importantly, in order to receive the profit-making privileges the shareholders sought, their corporations had to represent a clear benefit for the public good, such a building a road, canal, or bridge. And when corporations violated any of these terms, their charters were frequently revoked by the state legislatures.
http://reclaimdemocracy.org/personhood/edwards_morgan_corporate.html

The third missing piece is that the free market is NOT a free market...

Corporations are a good thing. They encourage us to take risks. They maximize wealth. They create jobs. They're a great thing, but they should not be running our government. The reason for that is they don't have the same aspirations for America that you and I do. A corporation does not want democracy. It does not want free markets, it wants profits, and the best way for it to get profits is to use our campaign-finance system -- which is just a system of legalized bribery -- to get their stakes, their hooks into a public official and then use that public official to dismantle the marketplace to give them a competitive advantage and then to privatize the commons, to steal the commonwealth, to liquidate public assets for cash, to plunder, to steal from the rest of us.

The domination of business by government is called communism. The domination of government by business is called fascism. And our job is to walk that narrow trail in between, which is free-market capitalism and democracy. And keep big government at bay with our right hand and corporate power at bay with our left.
http://www.sierraclub.org/pressroom/speeches/2005-09-10rfkjr.asp


----------



## Kevin_Kennedy

The history lesson was sound, however the economics lesson was not.  This recent downturn is not the product of an unregulated market, it is the product of a highly regulated market with a central economic planner that creates the business cycle.  I'm not sure how you can say that the market was full of unregulated greed, and then boldly state that the free market isn't a free market.  Those are opposing concepts.  Of course the market hasn't been free, that's why this downturn can't possibly be chalked up to deregulation.

And while it's true that the founders did believe that the government should have its hand in infrastructure, which is why they authorized this under the Constitution, it doesn't change basic economics whatsoever.  Government spending always hurts the economy.


----------



## Iriemon

Kevin_Kennedy said:


> The history lesson was sound, however the economics lesson was not.  This recent downturn is not the product of an unregulated market, it is the product of a highly regulated market with a central economic planner that creates the business cycle.



 Which central economic planner or regulation made the decision for the financial institutions to invest so many trillions in securitized mortgage packages?


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> The history lesson was sound, however the economics lesson was not.  This recent downturn is not the product of an unregulated market, it is the product of a highly regulated market with a central economic planner that creates the business cycle.
> 
> 
> 
> 
> Which central economic planner or regulation made the decision for the financial institutions to invest so many trillions in securitized mortgage packages?
Click to expand...


The Fed's easy-money policies and the fact that Fannie Mae and Freddie Mac are government sponsored agencies made that possible.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> The history lesson was sound, however the economics lesson was not.  This recent downturn is not the product of an unregulated market, it is the product of a highly regulated market with a central economic planner that creates the business cycle.
> 
> 
> 
> 
> Which central economic planner or regulation made the decision for the financial ?
> 
> Click to expand...
> 
> 
> The Fed's easy-money policies and the fact that Fannie Mae and Freddie Mac are government sponsored agencies made that possible.
Click to expand...


How did the Fed or Freddie/Freddie require the institutions to invest so many trillions in securitized mortgage packages?


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> Which central economic planner or regulation made the decision for the financial ?
> 
> 
> 
> 
> The Fed's easy-money policies and the fact that Fannie Mae and Freddie Mac are government sponsored agencies made that possible.
> 
> Click to expand...
> 
> 
> How did the Fed or Freddie/Freddie require the institutions to invest so many trillions in securitized mortgage packages?
Click to expand...


Well the Community Reinvestment Act forced banks to make higher-risk loans, which were then bought up by Fannie/Freddie.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> The Fed's easy-money policies and the fact that Fannie Mae and Freddie Mac are government sponsored agencies made that possible.
> 
> 
> 
> 
> How did the Fed or Freddie/Freddie require the institutions to invest so many trillions in securitized mortgage packages?
> 
> Click to expand...
> 
> 
> Well the Community Reinvestment Act forced banks to make higher-risk loans, which were then bought up by Fannie/Freddie.
Click to expand...


That is false.  CRA required no loans, only that there be no discrimination, and certainly didn't require the financial institutions to invest trillions in risky mortgages.  It wasn't Freddie/Fannie that owned the trillions in mortgages that crippled the biggest financial instituions.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> How did the Fed or Freddie/Freddie require the institutions to invest so many trillions in securitized mortgage packages?
> 
> 
> 
> 
> Well the Community Reinvestment Act forced banks to make higher-risk loans, which were then bought up by Fannie/Freddie.
> 
> Click to expand...
> 
> 
> That is false.  CRA required no loans, only that there be no discrimination, and certainly didn't require the financial institutions to invest trillions in risky mortgages.  It wasn't Freddie/Fannie that owned the trillions in mortgages that crippled the biggest financial instituions.
Click to expand...


The CRA Scam and its Defenders - Thomas J. DiLorenzo - Mises Institute


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Well the Community Reinvestment Act forced banks to make higher-risk loans, which were then bought up by Fannie/Freddie.
> 
> 
> 
> 
> That is false.  CRA required no loans, only that there be no discrimination, and certainly didn't require the financial institutions to invest trillions in risky mortgages.  It wasn't Freddie/Fannie that owned the trillions in mortgages that crippled the biggest financial instituions.
> 
> Click to expand...
> 
> 
> The CRA Scam and its Defenders - Thomas J. DiLorenzo - Mises Institute
Click to expand...


It doesn't say that the CRA, which was establihed 35 years ago, suddenly required  giant financial institutions to invest trillions in risky mortgages in '04-07.  They did that on their own to make profits.  Thanks.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> That is false.  CRA required no loans, only that there be no discrimination, and certainly didn't require the financial institutions to invest trillions in risky mortgages.  It wasn't Freddie/Fannie that owned the trillions in mortgages that crippled the biggest financial instituions.
> 
> 
> 
> 
> The CRA Scam and its Defenders - Thomas J. DiLorenzo - Mises Institute
> 
> Click to expand...
> 
> 
> It doesn't say that the CRA, which was establihed 35 years ago, suddenly required  giant financial institutions to invest trillions in risky mortgages in '04-07.  They did that on their own to make profits.  Thanks.
Click to expand...


Did you read the article?



> Gordon is a defender of the federal government's 1977 Community Reinvestment Act (CRA) under which the Fed and other financial regulators have pressured/extorted banks into making more loans to less-than-creditworthy borrowers than they would normally be willing to risk.



At any rate, your last sentence, "They did that on their own to make profits," is partially true.  They certainly did lower their standards on their own as well, but that wouldn't have been possible had it not been for the Fed's easy-money policies.


----------



## SW2SILVERQUASI

Yep, without a doubt, World War 2  did the trick. It started what Eisenhower called the military industrial complex, it's buku bucks. Well, we are in a war now, and it isn't helping, it is dragging down the economy. So, what's the difference between THEN and NOW?  That might be a real source of debate. I have no answer to that.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> The CRA Scam and its Defenders - Thomas J. DiLorenzo - Mises Institute
> 
> 
> 
> 
> It doesn't say that the CRA, which was establihed 35 years ago, suddenly required  giant financial institutions to invest trillions in risky mortgages in '04-07.  They did that on their own to make profits.  Thanks.
> 
> Click to expand...
> 
> 
> Did you read the article?
> 
> 
> 
> 
> Gordon is a defender of the federal government's 1977 Community Reinvestment Act (CRA) under which the Fed and other financial regulators have pressured/extorted banks into making more loans to less-than-creditworthy borrowers than they would normally be willing to risk.
> 
> Click to expand...
> 
> 
> At any rate, your last sentence, "They did that on their own to make profits," is partially true.  They certainly did lower their standards on their own as well, but that wouldn't have been possible had it not been for the Fed's easy-money policies.
Click to expand...


Oh sure they could have.  That is proved by the fact that the Fed did raise the rates thru 05-06 and the big insitutions just kept write on buying those mortgage packages.   They just charged a bit more interest.  Fed policies had little to do with it.


----------



## mash107

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> It doesn't say that the CRA, which was establihed 35 years ago, suddenly required  giant financial institutions to invest trillions in risky mortgages in '04-07.  They did that on their own to make profits.  Thanks.
> 
> 
> 
> 
> Did you read the article?
> 
> 
> 
> 
> Gordon is a defender of the federal government's 1977 Community Reinvestment Act (CRA) under which the Fed and other financial regulators have pressured/extorted banks into making more loans to less-than-creditworthy borrowers than they would normally be willing to risk.
> 
> Click to expand...
> 
> 
> At any rate, your last sentence, "They did that on their own to make profits," is partially true.  They certainly did lower their standards on their own as well, but that wouldn't have been possible had it not been for the Fed's easy-money policies.
> 
> Click to expand...
> 
> 
> Oh sure they could have.  That is proved by the fact that the Fed did raise the rates thru 05-06 and the big insitutions just kept write on buying those mortgage packages.   They just charged a bit more interest.  Fed policies had little to do with it.
Click to expand...


First, you seem a bit confused as to what happened. Federal Reserve is the cause of the inflation, not that securities were made and bought. They are responsible for the huge inflation in the housing market, creating a bubble, which inevitably had to crash. This hid decades upon decades of losing money caused by the CRA. Fannie Mae and Freddie Mac were the first to securitize mortgage debt, because of regulations passed that required them to do so. Thus began the slippery slope into this centrally planned recession (just like them all!)


----------



## Kevin_Kennedy

SW2SILVERQUASI said:


> Yep, without a doubt, World War 2  did the trick. It started what Eisenhower called the military industrial complex, it's buku bucks. Well, we are in a war now, and it isn't helping, it is dragging down the economy. So, what's the difference between THEN and NOW?  That might be a real source of debate. I have no answer to that.



There is no difference, war-time spending only hurts the economy.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> It doesn't say that the CRA, which was establihed 35 years ago, suddenly required  giant financial institutions to invest trillions in risky mortgages in '04-07.  They did that on their own to make profits.  Thanks.
> 
> 
> 
> 
> Did you read the article?
> 
> 
> 
> 
> Gordon is a defender of the federal government's 1977 Community Reinvestment Act (CRA) under which the Fed and other financial regulators have pressured/extorted banks into making more loans to less-than-creditworthy borrowers than they would normally be willing to risk.
> 
> Click to expand...
> 
> 
> At any rate, your last sentence, "They did that on their own to make profits," is partially true.  They certainly did lower their standards on their own as well, but that wouldn't have been possible had it not been for the Fed's easy-money policies.
> 
> Click to expand...
> 
> 
> Oh sure they could have.  That is proved by the fact that the Fed did raise the rates thru 05-06 and the big insitutions just kept write on buying those mortgage packages.   They just charged a bit more interest.  Fed policies had little to do with it.
Click to expand...


Well as stated before, they were coerced into making many of those loans and without being forced or the Fed's easy-money policies it wouldn't have made any sense to do so.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Did you read the article?
> 
> 
> 
> At any rate, your last sentence, "They did that on their own to make profits," is partially true.  They certainly did lower their standards on their own as well, but that wouldn't have been possible had it not been for the Fed's easy-money policies.
> 
> 
> 
> 
> Oh sure they could have.  That is proved by the fact that the Fed did raise the rates thru 05-06 and the big insitutions just kept write on buying those mortgage packages.   They just charged a bit more interest.  Fed policies had little to do with it.
> 
> Click to expand...
> 
> 
> Well as stated before, they were coerced into making many of those loans and without being forced or the Fed's easy-money policies it wouldn't have made any sense to do so.
Click to expand...


They weren't coerced into making loans.  None of those banks had to make one damn loan if they thought it was too risky. 

They made those shitty loans because they were making shitloads of money at the time and that is the only reason they did it.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> Oh sure they could have.  That is proved by the fact that the Fed did raise the rates thru 05-06 and the big insitutions just kept write on buying those mortgage packages.   They just charged a bit more interest.  Fed policies had little to do with it.
> 
> 
> 
> 
> Well as stated before, they were coerced into making many of those loans and without being forced or the Fed's easy-money policies it wouldn't have made any sense to do so.
> 
> Click to expand...
> 
> 
> They weren't coerced into making loans.  None of those banks had to make one damn loan if they thought it was too risky.
> 
> They made those shitty loans because they were making shitloads of money at the time and that is the only reason they did it.
Click to expand...


Incorrect.


----------



## Iriemon

mash107 said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Did you read the article?
> 
> At any rate, your last sentence, "They did that on their own to make profits," is partially true.  They certainly did lower their standards on their own as well, but that wouldn't have been possible had it not been for the Fed's easy-money policies.
> 
> 
> 
> 
> Oh sure they could have.  That is proved by the fact that the Fed did raise the rates thru 05-06 and the big insitutions just kept write on buying those mortgage packages.   They just charged a bit more interest.  Fed policies had little to do with it.
> 
> Click to expand...
> 
> 
> First, you seem a bit confused as to what happened. Federal Reserve is the cause of the inflation, not that securities were made and bought.
Click to expand...


Well jeez, you don't have to tell me that, that is my point.  It's Kevin who is arguing the Fed caused the crappy mortgages to be bought.



> They are responsible for the huge inflation in the housing market, creating a bubble, which inevitably had to crash.



No they're not.  That was all the speculators watching "you too can be a millionaire with real estate videos) buying up homes to flip and make a profit. 



> This hid decades upon decades of losing money caused by the CRA. Fannie Mae and Freddie Mac were the first to securitize mortgage debt, because of regulations passed that required them to do so. Thus began the slippery slope into this centrally planned recession (just like them all!)



Nobody forced Citi and Goldman and everyone else to buy trillions of these things.  They did it to make a profit and their shareholders did't appreciate the huge risk they were taking to make those profits everyone loved to see.

And they created a market for shitty loans that brokers gave to everyone watching make a million in real estate videos who went out and bought house on speculation.

That was what caused the recession.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Well as stated before, they were coerced into making many of those loans and without being forced or the Fed's easy-money policies it wouldn't have made any sense to do so.
> 
> 
> 
> 
> They weren't coerced into making loans.  None of those banks had to make one damn loan if they thought it was too risky.
> 
> They made those shitty loans because they were making shitloads of money at the time and that is the only reason they did it.
> 
> Click to expand...
> 
> 
> Incorrect.
Click to expand...


Correct.  Sorry, but your simple "its all the fed's fault" view of things so you can get your gold standard on just doesn't fly with the facts.


----------



## mash107

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> Oh sure they could have.  That is proved by the fact that the Fed did raise the rates thru 05-06 and the big insitutions just kept write on buying those mortgage packages.   They just charged a bit more interest.  Fed policies had little to do with it.
> 
> 
> 
> 
> Well as stated before, they were coerced into making many of those loans and without being forced or the Fed's easy-money policies it wouldn't have made any sense to do so.
> 
> Click to expand...
> 
> 
> They weren't coerced into making loans.  None of those banks had to make one damn loan if they thought it was too risky.
> 
> They made those shitty loans because they were making shitloads of money at the time and that is the only reason they did it.
Click to expand...


You just contradicted yourself. You say that they weren't forced. And you are also saying that issuing shitty loans is profitable event. Now why would CRA be at all necessary to legislate? How about Fannie Mae and Freddie Mac? If making shitty loans is a profitable scheme, why would you need government to tell you to do it? You'd be a horrible banker if you ignored a potential money maker; your competition would surely gobble it up. Because, clearly, making shitty loans loses you money... and, for political gain, the government legislated that all banks make shitty loans. It was enforced whenever banks wanted to expand, merge or otherwise conduct business. It had to prove to regulators that enough shitty loans were made. Fannie Mae and Freddie Mac carried the bulk, and that's how securitization began; to enable Fannie and Freddie to issue more and more shitty loans. 

What was making everything appear black on all the banks' balance sheet was this unnatural growth in the housing market. The prices got inflated because of Federal Reserve artificially easy credit, and this made every bank seem solvent, whereas they were really not.


----------



## mash107

Iriemon said:


> Nobody forced Citi and Goldman and everyone else to buy trillions of these things.  They did it to make a profit and their shareholders did't appreciate the huge risk they were taking to make those profits everyone loved to see.
> 
> And they created a market for shitty loans that brokers gave to everyone watching make a million in real estate videos who went out and bought house on speculation.
> 
> That was what caused the recession.



Nobody forced Citi/Goldman/etc to buy trillions of these, correct. But the government guaranteed the securitized debt, that was largely generated from shitty loans made. That dissuades any risk associated with the securities, and the created housing boom in prices caused them to be lulled into a false sense of security, when they were seeing nothing but black ink on their balance sheets.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> They weren't coerced into making loans.  None of those banks had to make one damn loan if they thought it was too risky.
> 
> They made those shitty loans because they were making shitloads of money at the time and that is the only reason they did it.
> 
> 
> 
> 
> Incorrect.
> 
> Click to expand...
> 
> 
> Correct.  Sorry, but your simple "its all the fed's fault" view of things so you can get your gold standard on just doesn't fly with the facts.
Click to expand...


It flies quite well actually, being as it's true.


----------



## Iriemon

mash107 said:


> Iriemon said:
> 
> 
> 
> Nobody forced Citi and Goldman and everyone else to buy trillions of these things.  They did it to make a profit and their shareholders did't appreciate the huge risk they were taking to make those profits everyone loved to see.
> 
> And they created a market for shitty loans that brokers gave to everyone watching make a million in real estate videos who went out and bought house on speculation.
> 
> That was what caused the recession.
> 
> 
> 
> 
> Nobody forced Citi/Goldman/etc to buy trillions of these, correct. But the government guaranteed the securitized debt, that was largely generated from shitty loans made. That dissuades any risk associated with the securities, and the created housing boom in prices caused them to be lulled into a false sense of security, when they were seeing nothing but black ink on their balance sheets.
Click to expand...


The Govt did not guarantee the securitized debt.  Where did you get that from?

It may have been that some thought the Govt would come and bail out the mortgage industry, but there was no Govt guarantee on those mortgage loans.  The Govt only guaranteed a very small minority of loans which were made to low income groups under specific programs for that purpose.  But that its what caused the real estate market to collapse.


----------



## Iriemon

Kevin_Kennedy said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Incorrect.
> 
> 
> 
> 
> Correct.  Sorry, but your simple "its all the fed's fault" view of things so you can get your gold standard on just doesn't fly with the facts.
> 
> Click to expand...
> 
> 
> It flies quite well actually, being as it's true.
Click to expand...


Thanks for your opinion.


----------



## Iriemon

mash107 said:


> Iriemon said:
> 
> 
> 
> 
> 
> Kevin_Kennedy said:
> 
> 
> 
> Well as stated before, they were coerced into making many of those loans and without being forced or the Fed's easy-money policies it wouldn't have made any sense to do so.
> 
> 
> 
> 
> They weren't coerced into making loans.  None of those banks had to make one damn loan if they thought it was too risky.
> 
> They made those shitty loans because they were making shitloads of money at the time and that is the only reason they did it.
> 
> Click to expand...
> 
> 
> You just contradicted yourself. You say that they weren't forced. And you are also saying that issuing shitty loans is profitable event. Now why would CRA be at all necessary to legislate?
Click to expand...


The CRA was necessary because banks would just redline out entire neighborhoods, and not consider loans simply becaue black folk lived there irrespective of their income history and pay back ability.  The CRA made that practice illegal and said you could not discriminate simply because someone lived in a certain neighborhood.

It did not require banks to make bad loans in the neighborhood.



> How about Fannie Mae and Freddie Mac?



How about them?



> If making shitty loans is a profitable scheme, why would you need government to tell you to do it? You'd be a horrible banker if you ignored a potential money maker; your competition would surely gobble it up.



Of course that is what happened.  They made shitty loans because others were doing it and making beaucoup profit.  They just didn't appreciate the risk. 




> Because, clearly, making shitty loans loses you money... and, for political gain, the government legislated that all banks make shitty loans. It was enforced whenever banks wanted to expand, merge or otherwise conduct business. It had to prove to regulators that enough shitty loans were made. Fannie Mae and Freddie Mac carried the bulk, and that's how securitization began; to enable Fannie and Freddie to issue more and more shitty loans.



Shitty loans only lose money if they go bad.  

What specific government legislation required that all banks make shitty loans?  It wasn't the CRA, that didn't require you make shitty loans.  



> What was making everything appear black on all the banks' balance sheet was this unnatural growth in the housing market. The prices got inflated because of Federal Reserve artificially easy credit, and this made every bank seem solvent, whereas they were really not.



As long as the loans were being paid everything looked peachy and everyone got big bonuses.  That's why they did it, not because the Govt forced them too.


----------



## Kevin_Kennedy

Iriemon said:


> Kevin_Kennedy said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> Correct.  Sorry, but your simple "its all the fed's fault" view of things so you can get your gold standard on just doesn't fly with the facts.
> 
> 
> 
> 
> It flies quite well actually, being as it's true.
> 
> Click to expand...
> 
> 
> Thanks for your opinion.
Click to expand...


No problem, it seemed like the rational part of our discussion was over.


----------



## mash107

Iriemon said:


> mash107 said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> They weren't coerced into making loans.  None of those banks had to make one damn loan if they thought it was too risky.
> 
> They made those shitty loans because they were making shitloads of money at the time and that is the only reason they did it.
> 
> 
> 
> 
> You just contradicted yourself. You say that they weren't forced. And you are also saying that issuing shitty loans is profitable event. Now why would CRA be at all necessary to legislate?
> 
> Click to expand...
> 
> 
> The CRA was necessary because banks would just redline out entire neighborhoods, and not consider loans simply becaue black folk lived there irrespective of their income history and pay back ability.  The CRA made that practice illegal and said you could not discriminate simply because someone lived in a certain neighborhood.
> 
> It did not require banks to make bad loans in the neighborhood.
> 
> 
> 
> How about them?
> 
> 
> 
> Of course that is what happened.  They made shitty loans because others were doing it and making beaucoup profit.  They just didn't appreciate the risk.
> 
> 
> 
> 
> 
> Because, clearly, making shitty loans loses you money... and, for political gain, the government legislated that all banks make shitty loans. It was enforced whenever banks wanted to expand, merge or otherwise conduct business. It had to prove to regulators that enough shitty loans were made. Fannie Mae and Freddie Mac carried the bulk, and that's how securitization began; to enable Fannie and Freddie to issue more and more shitty loans.
> 
> Click to expand...
> 
> 
> Shitty loans only lose money if they go bad.
> 
> What specific government legislation required that all banks make shitty loans?  It wasn't the CRA, that didn't require you make shitty loans.
> 
> 
> 
> 
> What was making everything appear black on all the banks' balance sheet was this unnatural growth in the housing market. The prices got inflated because of Federal Reserve artificially easy credit, and this made every bank seem solvent, whereas they were really not.
> 
> Click to expand...
> 
> 
> As long as the loans were being paid everything looked peachy and everyone got big bonuses.  That's why they did it, not because the Govt forced them too.
Click to expand...


Let's study the chronology of events...

1. Banks didn't make shitty loans before government interference.

2. Government passed regulations requiring them to do so.

3. Banks make shitty loans, and banks are all insolvent. This insolvency is covered up by a huge, artificial bubble in housing prices for decades.


Now, of course, all banks are profit seekers. Why would they want to go bankrupt? So they would look at all and any avenues to make money. They, concluded, prior to government interference, that shitty loans go sour more often than not; therefore, they loaned only to those with steady incomes and a track record of paying back loans, as common sense dictates. The balance of failed shitty loans vs. profits off the slim group of shitty loans that were actually paid off was clearly examined, not pursued by the banks until government forced them to. If they were money makers, they would have been in the business of making shitty loans since the very beginning, but, as reality has shown us, they really aren't.


----------



## Iriemon

mash107 said:


> Let's study the chronology of events...
> 
> 1. Banks didn't make shitty loans before government interference.



Well actually they have, but not on this scale.  



> 2. Government passed regulations requiring them to do so.



That's BS.  No regulation required them to buy subprimes bundles.  They did it because they were making shitloads of money and didn't realize how shitty the loans were.



> 3. Banks make shitty loans, and banks are all insolvent. This insolvency is covered up by a huge, artificial bubble in housing prices for decades.



The banks weren't insolvent if the real estate market didn't crash.  Had the market pulled in the reins in 05/06 things probably would have been fine.  But it is not in the nature of greed to halt activity when you are getting rich.  



> Now, of course, all banks are profit seekers. Why would they want to go bankrupt? So they would look at all and any avenues to make money. They, concluded, prior to government interference, that shitty loans go sour more often than not; therefore, they loaned only to those with steady incomes and a track record of paying back loans, as common sense dictates. The balance of failed shitty loans vs. profits off the slim group of shitty loans that were actually paid off was clearly examined, not pursued by the banks until government forced them to. If they were money makers, they would have been in the business of making shitty loans since the very beginning, but, as reality has shown us, they really aren't.



The Govt didn't force the banks to invest in securitized subprime loans.  Sorry.


----------



## mash107

Iriemon said:


> mash107 said:
> 
> 
> 
> Let's study the chronology of events...
> 
> 1. Banks didn't make shitty loans before government interference.
> 
> 
> 
> 
> Well actually they have, but not on this scale.
> 
> 
> 
> 
> 2. Government passed regulations requiring them to do so.
> 
> Click to expand...
> 
> 
> That's BS.  No regulation required them to buy subprimes bundles.  They did it because they were making shitloads of money and didn't realize how shitty the loans were.
> 
> 
> 
> 
> 3. Banks make shitty loans, and banks are all insolvent. This insolvency is covered up by a huge, artificial bubble in housing prices for decades.
> 
> Click to expand...
> 
> 
> The banks weren't insolvent if the real estate market didn't crash.  Had the market pulled in the reins in 05/06 things probably would have been fine.  But it is not in the nature of greed to halt activity when you are getting rich.
> 
> 
> 
> 
> Now, of course, all banks are profit seekers. Why would they want to go bankrupt? So they would look at all and any avenues to make money. They, concluded, prior to government interference, that shitty loans go sour more often than not; therefore, they loaned only to those with steady incomes and a track record of paying back loans, as common sense dictates. The balance of failed shitty loans vs. profits off the slim group of shitty loans that were actually paid off was clearly examined, not pursued by the banks until government forced them to. If they were money makers, they would have been in the business of making shitty loans since the very beginning, but, as reality has shown us, they really aren't.
> 
> Click to expand...
> 
> 
> The Govt didn't force the banks to invest in securitized subprime loans.  Sorry.
Click to expand...


I'm talking about issuing loans. There wouldn't be any subprime loans to securitize, if there were no subprime loans being issued. The whole reason there were subprime loans are because of government interference. But to address your point, Fannie Mae did, in fact, get the apocalyptic snowball rolling, at the behest of government, on securitizing these subprime loans in order to allow more capital to flow into subprime markets. Many private banks did follow suit, with the implicit guarantees the government was issuing. Government, absolutely, guaranteed Fannie Mae and Freddie Mac securitized subprime debt, and it was implied this guarantee carried over to all subprime loans.


----------



## Iriemon

mash107 said:


> Iriemon said:
> 
> 
> 
> 
> 
> mash107 said:
> 
> 
> 
> Let's study the chronology of events...
> 
> 1. Banks didn't make shitty loans before government interference.
> 
> 
> 
> 
> Well actually they have, but not on this scale.
> 
> That's BS.  No regulation required them to buy subprimes bundles.  They did it because they were making shitloads of money and didn't realize how shitty the loans were.
> 
> 
> The banks weren't insolvent if the real estate market didn't crash.  Had the market pulled in the reins in 05/06 things probably would have been fine.  But it is not in the nature of greed to halt activity when you are getting rich.
> 
> 
> 
> 
> Now, of course, all banks are profit seekers. Why would they want to go bankrupt? So they would look at all and any avenues to make money. They, concluded, prior to government interference, that shitty loans go sour more often than not; therefore, they loaned only to those with steady incomes and a track record of paying back loans, as common sense dictates. The balance of failed shitty loans vs. profits off the slim group of shitty loans that were actually paid off was clearly examined, not pursued by the banks until government forced them to. If they were money makers, they would have been in the business of making shitty loans since the very beginning, but, as reality has shown us, they really aren't.
> 
> Click to expand...
> 
> 
> The Govt didn't force the banks to invest in securitized subprime loans.  Sorry.
> 
> Click to expand...
> 
> 
> I'm talking about issuing loans. There wouldn't be any subprime loans to securitize, if there were no subprime loans being issued. The whole reason there were subprime loans are because of government interference. But to address your point, Fannie Mae did, in fact, get the apocalyptic snowball rolling, at the behest of government, on securitizing these subprime loans in order to allow more capital to flow into subprime markets. Many private banks did follow suit, with the implicit guarantees the government was issuing. Government, absolutely, guaranteed Fannie Mae and Freddie Mac securitized subprime debt, and it was implied this guarantee carried over to all subprime loans.
Click to expand...


To the contrary.  "Subprime" were loans that *didn't* meet Fannie/Freddie underwriting requirements, and hence were more risky.  No Govt regulation required financial institutions to invest these things.  Securitization developed as a way to package these riskier loans and the thought was that they were less risky because of diversification.  What was underappreciated was the market risk.

No Govt agency rule or regulation required the financial institutions to invest trillions in these things.  And if you claim they did I'd like to see the regulation that required it.  Because I haven't yet.


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## Toro

Fannie and Freddie were small players in the subprime mortgage market.  Most subprime mortgages were written outside of the GSEs.  They were being propelled by the market, not by the government.


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## mash107

Iriemon said:


> mash107 said:
> 
> 
> 
> 
> 
> Iriemon said:
> 
> 
> 
> Well actually they have, but not on this scale.
> 
> That's BS.  No regulation required them to buy subprimes bundles.  They did it because they were making shitloads of money and didn't realize how shitty the loans were.
> 
> 
> The banks weren't insolvent if the real estate market didn't crash.  Had the market pulled in the reins in 05/06 things probably would have been fine.  But it is not in the nature of greed to halt activity when you are getting rich.
> 
> 
> 
> The Govt didn't force the banks to invest in securitized subprime loans.  Sorry.
> 
> 
> 
> 
> I'm talking about issuing loans. There wouldn't be any subprime loans to securitize, if there were no subprime loans being issued. The whole reason there were subprime loans are because of government interference. But to address your point, Fannie Mae did, in fact, get the apocalyptic snowball rolling, at the behest of government, on securitizing these subprime loans in order to allow more capital to flow into subprime markets. Many private banks did follow suit, with the implicit guarantees the government was issuing. Government, absolutely, guaranteed Fannie Mae and Freddie Mac securitized subprime debt, and it was implied this guarantee carried over to all subprime loans.
> 
> Click to expand...
> 
> 
> To the contrary.  "Subprime" were loans that *didn't* meet Fannie/Freddie underwriting requirements, and hence were more risky.  No Govt regulation required financial institutions to invest these things.  Securitization developed as a way to package these riskier loans and the thought was that they were less risky because of diversification.  What was underappreciated was the market risk.
> 
> No Govt agency rule or regulation required the financial institutions to invest trillions in these things.  And if you claim they did I'd like to see the regulation that required it.  Because I haven't yet.
Click to expand...


Given that all the loans that Freddie and Fannie make are loans that the free market wouldn't make, hence their existence; all loans made by those two companies are subprime. The entire market those two government entities engage in, as well as all the loans CRA legislated for private banks to make out, are subprime. That is, the return on all those loans would be net loss, otherwise banks would be doing it all along, and there would be no need for government interference.


----------



## Iriemon

mash107 said:


> Iriemon said:
> 
> 
> 
> 
> 
> mash107 said:
> 
> 
> 
> I'm talking about issuing loans. There wouldn't be any subprime loans to securitize, if there were no subprime loans being issued. The whole reason there were subprime loans are because of government interference. But to address your point, Fannie Mae did, in fact, get the apocalyptic snowball rolling, at the behest of government, on securitizing these subprime loans in order to allow more capital to flow into subprime markets. Many private banks did follow suit, with the implicit guarantees the government was issuing. Government, absolutely, guaranteed Fannie Mae and Freddie Mac securitized subprime debt, and it was implied this guarantee carried over to all subprime loans.
> 
> 
> 
> 
> To the contrary.  "Subprime" were loans that *didn't* meet Fannie/Freddie underwriting requirements, and hence were more risky.  No Govt regulation required financial institutions to invest these things.  Securitization developed as a way to package these riskier loans and the thought was that they were less risky because of diversification.  What was underappreciated was the market risk.
> 
> No Govt agency rule or regulation required the financial institutions to invest trillions in these things.  And if you claim they did I'd like to see the regulation that required it.  Because I haven't yet.
> 
> Click to expand...
> 
> 
> Given that all the loans that Freddie and Fannie make are loans that the free market wouldn't make, hence their existence; all loans made by those two companies are subprime. The entire market those two government entities engage in, as well as all the loans CRA legislated for private banks to make out, are subprime. That is, the return on all those loans would be net loss, otherwise banks would be doing it all along, and there would be no need for government interference.
Click to expand...


Poppycock.  Only a small percentage of F/F loans are subprime.


----------



## editec

Kevin_Kennedy said:


> The history lesson was sound, however the economics lesson was not. This recent downturn is not the product of an unregulated market, it is the product of a highly regulated market with a central economic planner that creates the business cycle. I'm not sure how you can say that the market was full of unregulated greed, and then boldly state that the free market isn't a free market. Those are opposing concepts. Of course the market hasn't been free, that's why this downturn can't possibly be chalked up to deregulation.
> 
> And while it's true that the founders did believe that the government should have its hand in infrastructure, which is why they authorized this under the Constitution, it doesn't change basic economics whatsoever. Government spending always hurts the economy.


 
'It is NOT a question of regulation or NO regulation, Kevin.

Its a question of GOOD regulation or BAD regulation.

We have plenty of regulations...bad regulation.

But as to this economic meldown?

Most of it is occurring thanks to the dereviatives market which had ZERO regulations governing it.

So get your facts straight and stop pretending that 10% of the story of this meltdown is the whole story.

You are smart enough to know that is not true.


----------



## onecut39

Gunny said:


> SpidermanTuba said:
> 
> 
> 
> I guess technically this is history, but its so relevant to now I thought it best here.
> 
> 
> Now that we're already into this recession, there's no point to playing the blame game any more. Especially when there is plenty of blame to be heaped on both sides.
> 
> The real question now, is how do we fix it?
> 
> Let's look to history.
> 
> 
> The Great Depression - for what reasons did it end?
> 
> 
> 
> 
> A better question ... Why is something from the 1930s posted in Current Events?
Click to expand...


Those who ignore history will be forced to relive it.


----------

