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The United States is Broke

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Dave_LF
Post subject: Re: The United States is Broke
Posted: Fri 18 Dec , 2009 2:14 pm
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Cenedril_Gildinaur wrote:
Dave_LF wrote:
But this is only true in the early stages. As you head toward time infinity, either due to superior practices, dumb luck, or both, some individual businesses will gain an edge on their competitors. Once that happens positive feedback sets in, and soon you have monopolies who are too big and powerful to fear either upstarts or their customers or their employees. And who can't be voted out.
But that has never happened in practice.
Have governments ever left business alone long enough to find out? :D I don't know enough economic history to attempt a rebuttal, but what I described is certainly what happens in biological evolution. Yes, from time to time a "monopoly species" will go extinct for one reason or another, and then there will be a flurry of evolution as other species compete to fill the void, but that is a brief arrangement that persists only as long as it takes to reestablish equilibrium.

100% free markets coupled with unpredictable-yet-not-infrequent "reset events" is interesting to consider.
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On the other hand, we have direct evidence that a similar cycle happens in government, where the more it grows the rate of growth accelerates. With every other product people eventually reach a point where they are sated, but with government people demand more the more there is. Once that happens positive feedback sets in, and soon you have tyrannies that are too big and powerful to fear either upstarts reformers or their own citizenry.
Yes, this is why the people must be vigilant against tyranny in my model, just like they must be vigilant against big government in yours. But I think a powerful, benevolent government is a better reward for their vigil than a weak, benevolent one.
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But in order to chuck the corporations, you need to chuck the rules that made the corporations, which brings us right back to the government.
Yes, I would like to see the people reform the way the government treats corporations; but I don't think the solution is making the government too weak to do anything with them at all.


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sauronsfinger
Post subject: Re: The United States is Broke
Posted: Fri 18 Dec , 2009 3:10 pm
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from Dave LF
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I would like to see the people reform the way the government treats corporations; but I don't think the solution is making the government too weak to do anything with them at all.
Exactly. And the way that is done in the USA is through the elected representatives of the American people, our Government. That is the legal mechanism that is set up in our Constitution and other laws of the land. It gives us a peaceful and orderly way to challenge corporate greed and power without having to risk mob street action, illegal tactics or outright violence.
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But I think a powerful, benevolent government is a better reward for their vigil than a weak, benevolent one.
You have struck the nail firmly upon its head. The fact is that corporations are the most powerful private forces at work in our nation. They wield great power through their wealth and influence. The individual stands little to no chance against them. The legal representatives of the American people are our duly elected representatives in government and those who work for them. That is why if you weaken the government, if you weaken the power of government, all you eventually do is weaken the people. You are 100% right in saying
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Yes, this is why the people must be vigilant against tyranny in my model
as long as the people keep close tabs on the government and guard against tyranny, the system can work the way it is suppose to work to protect the public interest.

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There are two novels that can change a bookish fourteen-year old's life: The Lord of the Rings and Atlas Shrugged. One is a childish fantasy that often engenders a lifelong obsession with its unbelievable heroes, leading to an emotionally stunted, socially crippled adulthood, unable to deal with the real world. The other, of course, involves orcs. - John Rogers


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TheEllipticalDisillusion
Post subject: Re: The United States is Broke
Posted: Fri 18 Dec , 2009 3:57 pm
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Chucking the rules that allow corporations all their power doesn't require chucking the entire government. Our choices can't possibly be only between two extremes.

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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Sat 26 Dec , 2009 6:19 pm
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Dave_LF wrote:
Cenedril_Gildinaur wrote:
On the other hand, we have direct evidence that a similar cycle happens in government, where the more it grows the rate of growth accelerates. With every other product people eventually reach a point where they are sated, but with government people demand more the more there is. Once that happens positive feedback sets in, and soon you have tyrannies that are too big and powerful to fear either upstarts reformers or their own citizenry.
Yes, this is why the people must be vigilant against tyranny in my model, just like they must be vigilant against big government in yours. But I think a powerful, benevolent government is a better reward for their vigil than a weak, benevolent one.
That's all well and good when discussing theoretical models. Even I can discuss theoretical models of a powerful benevolent government. But when it comes to real world application that theoretical model falls apart.

Take the case of Rockefeller Center. I do not know if the example I am thinking about still stands (I haven't checked but they probably still stand). If you look carefully you will see two old buildings in that center. They are not part of the center. Back when Rockefeller was building his impressive center, two property owners wouldn't sell. Well, one would sell, but he was hoping to become absurdly rich when he found out who wanted to buy his house. The other simply wouldn't sell.

This was back in the days when businessmen allegedly had unlimited unchecked power. Allegedly they could do anything and nobody could stop them. Because he was so unrestrained by a powerful benevolent government, Rockefeller was unable to buy those two houses. Now, in modern times, now that we have a powerful benevolent government he would simply bribe the city government to take them by eminent domain (reference Kelo v. New London) since we now have a powerful benevolent government to protect us from that. But back when there were no protections of that sort Rockefeller was completely unable to take those to houses.

You see, the danger is that when you discuss theory people will mistake it with discussing real world implementation. In practice there are only two types of people who discuss big benevolent government, and once you have determined that someone isn't discussing theory as you are you can try to figure out which of the two types you are viewing.

One is the sinister type. They know damn well that there's no such thing as a powerful benevolent government in the real world, but hopes that by talking about such that he can fool others into giving the government power for him to use. His hope is that he may become part of that powerful but not benevolent government, he will be part of the ruling class in some way.

The other is the useful fool. These kinds are lied to by the sinister types, and have actually come to believe that the sinister types actually care about them and will treat them well if they give the sinister types all they want. A sucker is born every minute, and they all believe in the theory of the powerful benevolent government without being part of that ruling class.

There may be a third type, the Sinister Fool. The Sinister Fool knows there's no such thing as a benevolent big government but advocates it anyway in order to have everyone controlled for the sake of control itself. This person, if he exists, is actually proud of being a small part of something big and evil. Interestingly this person has the potential to become the worst of dictators, as described here starting in the third paragraph.

Yes, some may worry that without strong government control that the corporations would be unstoppable, just like Rockefeller was when faced with two holdouts.

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It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

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sauronsfinger
Post subject: Re: The United States is Broke
Posted: Sat 26 Dec , 2009 7:22 pm
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Dave and TED,
while we are throwing around theories, do not forget the one about the Paranoid Wacko ..... he is afraid of the government, sorry BIG GOVERNMENT and all he has allowed his own deluded mind to believe that it stands for.

This commentary from Keith Olbermann illustrates it rather well using Glen Beck and his commentary on a New York landmark built to honor communists, Bolsheviks Lenin, Stalin, Trotsky and militant workers everywhere. Oh, I forgot marijuana growers and smokers. Them too.

http://www.youtube.com/watch?v=p0cnlURWUuA

The 21st century American who lives in our country and realizes our problems only wants a balanced government which can act in the public interest and within the laws and the Constitution. The radical extremists, the True Believers, the marginalized right wingers, and the people who think we are still living in a system where what worked in the 18th century will work today have no real interest in our real problems and real solutions. That is sad.

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There are two novels that can change a bookish fourteen-year old's life: The Lord of the Rings and Atlas Shrugged. One is a childish fantasy that often engenders a lifelong obsession with its unbelievable heroes, leading to an emotionally stunted, socially crippled adulthood, unable to deal with the real world. The other, of course, involves orcs. - John Rogers


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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Tue 12 Jan , 2010 10:20 pm
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I know we're supposed to be optimistic. But there is no reason to be optimistic.

The economic health of America is dire and worsening
Quote:
The Recession is Over, the Depression Just Beginning - by Stephen Lendman

In late 2009, former Merrill Lynch economist, now with the Canadian firm, Gluskin Sheff, said the following:

"The credit collapse and the accompanying deflation and overcapacity are going to drive the economy and financial markets in 2010. We have said this repeatedly that this recession is really a depression because the (post-WW II) recessions were merely small backward steps in an inventory cycle but in the context of expanding credit. Whereas now, we are in a prolonged period of credit contraction, especially as it relates to households and small businesses."

Summarizing his 2010 outlook, Rosenberg highlighted asset deflation and credit contraction imploding "the largest balance sheet in the world - the US household sector" in the amount of "an epic $12 trillion of lost net worth, a degree of trauma we have never seen before," even after the equity bear market rally and "tenuous" housing recovery likely to be short-lived and illusory with a true bottom many months away.

As a result, consumer spending will be severely impacted. "Frugality is the new fashion and likely to stay that way for years," highlighting a secular shift toward prudence and conservatism because households are traumatized, tapped out, and mindful of a bleak outlook. It shows in new consumer credit data, contracting $17.5 billion in November, the largest monthly amount since 1943 record keeping began.

Surprisingly, only people over age 55 have experienced job growth. All others have lost jobs, can't get them, and for youths the "unemployment crisis (is) of epic proportions." In addition, there's a record number of Americans out of work for longer than six months, in part because the "aging but not aged" aren't retiring, and those who did are coming back, of necessity, to make up for wealth lost.

Rosenberg stresses that for a sustainable recovery to begin, the ratio of household credit to personal disposable income must revert to the mean and reach an excess in the opposite direction. In the 1950s, it was 30%. Today its 125%, down from the late 2007 139% peak, with a long way to go taking years, and when it's over, another $7 trillion in household credit will have to be extinguished.

Until he retired in 1992, Robert Farrell was a highly respected Merrill Lynch market strategist and theorist, best remembered for his "10 Market Rules to Remember." Number one was that "markets tend to return to the mean over time." Number two was that "excesses in one direction will lead to an opposite excess in the other direction," and number nine was that "when all the experts and forecasts agree -- something else is going to happen."
Much MUCH more. It's a long article, but VERY worth the read. He takes a particularly hard look at Michigan and California, two states that are in particularly bad shape.

_________________

It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

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sauronsfinger
Post subject: Re: The United States is Broke
Posted: Wed 13 Jan , 2010 12:41 pm
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Robert Reich has an excellent article on the road ahead for the economy.
Quote:
Why Obama must take on Wall Street
By Robert Reich
Published: January 12 2010 20:40


It has been more than a year since all hell broke loose on Wall Street and, remarkably, almost nothing has been done to prevent all hell from breaking loose again.

In fact, close your eyes and you could be back in the wilds of 2007. Bankers are still making wild bets, still devising new derivatives, still piling on debt. The big banks have access to money almost as cheaply as in 2007, courtesy of the Fed, so bank profits are up and bonuses as generous as at the height of the boom.

The only difference is that now the Street’s biggest banks know they are “too big to fail” and will be bailed out by taxpayers if they get into trouble – which means they have every incentive to make even riskier bets. And, of course, American taxpayers are out some $120bn, while millions have lost their homes, jobs and savings.

All could be forgiven if the House and Senate committees with responsibility for coming up with new regulations were about to come down hard on the Street and if the Obama administration were pushing them to. But nothing of the sort is happening.

Last week, Senator Chris Dodd, chairman of the Senate banking committee, announced he would not seek re-election next November, recasting himself as a lame duck who will do whatever the banks want. Mr Dodd’s decision “makes it more likely that regulatory reform will be enacted”, says Edward Yingling, chief executive of the American Bankers Association, because it “frees him from political dynamics that would have made it more difficult for him to compromise”. Translated: Dodd’s committee will report out a bill – Democrats would be embarrassed not to – but it will be weak because voters can no longer penalise Mr Dodd for rolling over for the Street.

The bill that has already emerged from the House is hardly encouraging. Dubbed the “Wall Street Reform and Consumer Protection Act”, it effectively guarantees future Wall Street bail-outs. The bill authorises Fed banks to provide up to $4,000bn in emergency funding the next time the Street crashes. That is more than twice what the Fed pumped into financial markets last year. The bill also enables the government, in a banking crisis, to back financial firms’ debts – a wonderful insurance policy if you are a bondholder. To be sure, the bill authorises the Fed and Treasury to spend these funds only when “there is at least a 99 per cent likelihood that all funds and interest will be paid back,” but predictions about pending economic disasters can be conveniently flexible, especially when it comes to bailing out the Street.

If this were not enough, the House bill creates regulatory loopholes big enough for bankers to drive their Jaguars through. Consider derivatives. Last year, as taxpayers threw money at the Street, congressional leaders promised to put derivative trading on public exchanges. The prices of derivatives could be disclosed and margin requirements imposed, making it more likely that traders would make good on their bets. Yet the House bill exempts nearly half the $600,000bn of outstanding derivatives trades.

The bill also allows – but, notably, does not require – regulators to “prohibit any incentive-based payment arrangement”. This makes fat bonuses the norm unless a regulator has reason to prevent them. And as we witnessed last year, bank regulators tend not to disturb the status quo. The House bill does not even make an attempt to unravel the conflict of interest that led credit ratings agencies to turn a blind eye to the risks the Street was taking on.

To its credit, the House bill does create a Consumer Financial Protection Agency to protect borrowers from predatory lending. Banking regulators have authority to protect consumers but failed to do so, so consolidating these powers in a new agency makes some sense. But Senate Republicans are dead-set against it, and Mr Dodd’s new willingness to compromise may well doom it in that chamber.

What is truly remarkable is what Congress and the administration have shown no interest in doing. Large numbers of Americans have lost their homes to bank foreclosures or are in danger of doing so. Yet American bankruptcy law does not allow homeowners to declare bankruptcy and have their mortgages reorganised. If it did, homeowners would have more bargaining power to renegotiate with banks. But neither Congress nor the administration has pushed to change the bankruptcy laws. Wall Street opposes such change and was instrumental in narrowing the scope of personal bankruptcy in the first place.

Nor have lawmakers shown any enthusiasm for resurrecting the wall that used to exist between commercial and investment banking. The Glass-Steagall Act, passed in the wake of the Great Crash of 1929, separated the two after it became obvious that commercial deposits needed to be insured by government and kept distinct from the betting parlour of investment banking. But Wall Street forced Congress to take down the wall in 1999, enabling financial supermarkets such as Citigroup to use its deposits to make all sorts of bets. Even Obama adviser and former Fed chief Paul Volcker has argued that the two functions should be separated again.

Nor is anyone talking seriously about using antitrust laws to break up the biggest banks – the traditional tonic for any capitalist entity that is “too big to fail”. Five giant Wall Street banks now dominate US finance. If it was in the public’s interest to break up giant oil companies and railroads a century ago, and the mammoth telephone company AT&T, it is not unreasonable to break up the almost infinitely extensive tangles of Citigroup, Bank of America, JPMorgan Chase, Goldman Sachs and Morgan Stanley. No one has offered a clear reason why giant banks are important to the US economy. Logic and experience suggests the reverse.

What happened to all the tough talk from Congress and the White House early last year? Why is the financial reform agenda so small, and so late?

Part of the answer is that the American public has moved on. A major tenet of US politics is that if politicians wait long enough, public attention wanders. With the financial crisis appearing to be over, the public is more concerned about jobs. Another 85,000 jobs were lost in December, bringing total losses since the recession began in December 2007 to over 7m. One out of six Americans is unemployed or underemployed.

Yet if the president and Congress wanted to, they could help Americans understand the link between widespread job losses and the irresponsibility on Wall Street that plunged America into the Great Recession. They could make tough financial reform part of the answer to sustain-able jobs growth over the long term.

True, financial regulation does not make a powerful bumper sticker. Few Americans know what the denizens of Wall Street do all day. Even fewer know or care about collateralised debt obligations or credit default swaps. To the extent Americans have been paying attention to the details of any public policy, it has been the healthcare reform bill. But that only begs the question of why financial reform has not been higher on the agenda of the president and Democratic leaders.

A larger explanation, I am afraid, is the grip Wall Street has over the American political process. The Street is where the money is and money buys campaign commercials on television. Wall Street firms and executives have been uniquely generous to both parties, emerging as one of the largest benefactors of the Democrats. Between November 2008 and November 2009, Wall Street doled out $42m to lawmakers, mostly to members of the House and Senate banking committees and House and Senate leaders. In the first three quarters of 2009, the industry spent $344m on lobbying – making the Street one of the major powerhouses in the nation’s capital.

Money is powerful. Talk is cheap. Mr Obama recently called the top bankers “fat cats”, and the bankers insisted they were shocked – shocked! – to learn how intransigent their lobbyists had been in opposing financial reform. The bankers even claimed a “disconnect” between their intentions and their lobbyists’ actions. This was all for the cameras, of course.

But the widening gulf between Wall Street and Main Street – a big bail-out for the former, unemployment checks for the latter; high profits and giant bonuses for the former, job and wage losses for the latter; buoyant expectations of the former, deep anxiety and cynicism by the latter; ever fancier estates for denizens of the former; mortgage foreclosures for the rest – is dangerous. Americans went ballistic early last summer when AIG executives got big bonuses after taxpayers had bailed them out. They will not be happy when Wall Street hands out billions in bonuses very soon. Angry populism lurks just beneath the surface of two-party politics in America. Just listen to Sarah Palin or her counterparts on American talk radio and yell television. Over the long term, the political stakes in reforming Wall Street are as high as the economic.

The author, a former US labour secretary, is professor of public policy at the University of California at Berkeley. His latest book is Supercapitalism

_________________

There are two novels that can change a bookish fourteen-year old's life: The Lord of the Rings and Atlas Shrugged. One is a childish fantasy that often engenders a lifelong obsession with its unbelievable heroes, leading to an emotionally stunted, socially crippled adulthood, unable to deal with the real world. The other, of course, involves orcs. - John Rogers


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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Wed 10 Feb , 2010 4:11 am
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It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

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Lord_Morningstar
Post subject: Re: The United States is Broke
Posted: Wed 10 Feb , 2010 4:30 am
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Some devotee of the Austrian School of Economics has way too much time on their hands...

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sauronsfinger
Post subject: Re: The United States is Broke
Posted: Wed 10 Feb , 2010 1:17 pm
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Excellent observation LM. I would love to see 100 people interviewed at random on the street and ask them to identify either of the two men in question after you provided their names. I am guessing that less than 2 people would recognize either of them. But with the Austrians and their political allies, this is a cause celebre.

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There are two novels that can change a bookish fourteen-year old's life: The Lord of the Rings and Atlas Shrugged. One is a childish fantasy that often engenders a lifelong obsession with its unbelievable heroes, leading to an emotionally stunted, socially crippled adulthood, unable to deal with the real world. The other, of course, involves orcs. - John Rogers


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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Thu 11 Feb , 2010 12:50 am
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Lord_Morningstar wrote:
Some devotee of the Austrian School of Economics has way too much time on their hands...
I wouldn't say that. I'd say that making educational videos is a very useful thing to do, given how few people understand anything about economics these days. It simply isn't stressed in our government education system, for some reason, and thus the average high school graduate doesn't even know the basics, such as who is Keynes.

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It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Mon 15 Mar , 2010 1:08 pm
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Social Security to start cashing Uncle Sam's IOUs
Quote:
PARKERSBURG, W.Va. — The retirement nest egg of an entire generation is stashed away in this small town along the Ohio River: $2.5 trillion in IOUs from the federal government, payable to the Social Security Administration.

It's time to start cashing them in.

For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits — billions more each year.

Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.

Sounds like a good time to start tapping the nest egg. Too bad the federal government already spent that money over the years on other programs, preferring to borrow from Social Security rather than foreign creditors. In return, the Treasury Department issued a stack of IOUs — in the form of Treasury bonds — which are kept in a nondescript office building just down the street from Parkersburg's municipal offices.

Now the government will have to borrow even more money, much of it abroad, to start paying back the IOUs, and the timing couldn't be worse. The government is projected to post a record $1.5 trillion budget deficit this year, followed by trillion dollar deficits for years to come.
This wasn't supposed to happen for seven more years.

At least we can rest assured with the belief that since it has never defaulted before it is impossible for it to default now.

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It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Sun 09 May , 2010 4:42 am
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Well, Greece.

When Dubai fell, some said that it wasn't really a country per se, but was more of a rich mans hobby. Greece is nothing like that. Greece is a full fledged first world country.

Greece is leading the charge of the PIIGS (Portugal, Italy, Ireland, Greece, Spain). Spain looks to be on the edge now, pushed there by Greece's failure. How Spain got to be such a complete mess is a mystery. People make the absurd claim that the recession in the US was due to lack of regulation. How did Spain therefore get to be such a mess?

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It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

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Dave_LF
Post subject: Re: The United States is Broke
Posted: Wed 26 May , 2010 1:58 am
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Anecdotal, but more than a little worrying:
http://kunstler.com/blog/2010/05/out-of-darkness.html
Quote:
I heard a lot of stories during the meeting in Atlanta last week but one really stood out. It was about the money and revealed a lot about what is going on in our banking system these days. A New Urbanist developer had gotten a small project going for a traditional neighborhood. Despite the global financial clusterfuck, the developer was able to meet the payments of his commercial loan. But the FDIC sent bank examiners around America and they told the small regional banks that if they had more than twenty percent of their loans in commercial real estate (CRE) they would be put out of business. The banks were ordered to reduce their loads of CRE by calling in the loans and liquidating the assets. Ironically, the banks only called in their "performing" loans, the ones that were being regularly paid off, because they were ignoring and even concealing the ones that weren't being paid.
The developer in question had his loan called in when the FDIC descended on his bank. He couldn't pay off the $3 million in one lump, of course. The FDIC's agents are going to seize and sell off his project if he can't get it refinanced in short order. He can't get it refinanced because there is now such a shortage of capital in the banking system that no one can get a loan for anything. Also, since it is now well-known that the bank failed, the vultures are circling above his project hoping to buy it for a discount, so even the few private investors who have money won't throw him a lifeline. By the way, the FDIC agents told him they are doing this because they now expect that virtually all commercial real estate loans in the USA will fail in the months ahead. Pretty scary story, huh? And he was one of the good guys.


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vison
Post subject: Re: The United States is Broke
Posted: Wed 26 May , 2010 4:08 am
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Dave, that story will be told a million times over the next year or so. It's terrible.

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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Sat 14 Aug , 2010 2:17 am
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Guys, this isn't just a cyclical downturn.

U.S. Is Bankrupt and We Don't Even Know It
Quote:
Let’s get real. The U.S. is bankrupt. Neither spending more nor taxing less will help the country pay its bills.

What it can and must do is radically simplify its tax, health-care, retirement and financial systems, each of which is a complete mess. But this is the good news. It means they can each be redesigned to achieve their legitimate purposes at much lower cost and, in the process, revitalize the economy.

Last month, the International Monetary Fund released its annual review of U.S. economic policy. Its summary contained these bland words about U.S. fiscal policy: “Directors welcomed the authorities’ commitment to fiscal stabilization, but noted that a larger than budgeted adjustment would be required to stabilize debt-to-GDP.”

But delve deeper, and you will find that the IMF has effectively pronounced the U.S. bankrupt. Section 6 of the July 2010 Selected Issues Paper says: “The U.S. fiscal gap associated with today’s federal fiscal policy is huge for plausible discount rates.” It adds that “closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 percent of U.S. GDP.”

The fiscal gap is the value today (the present value) of the difference between projected spending (including servicing official debt) and projected revenue in all future years.
This isn't a cyclical downturn. This is a basic structural collapse.

Of course, just as I was wrong about how the housing bubble would pop, and just as I was wrong that the mortgage backed securities would wound the banks, I'm probably just as wrong about this, too.

Bleak Jobs Report Indicates More Pain to Come
This Recession Is Not Like the Others
Is the US bankrupt?
America Is 'Bankrupt Mickey Mouse Economy'

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It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

Last edited by Cenedril_Gildinaur on Tue Feb 30, 2026 13:61 am; edited 426 times in total


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Ara-anna
Post subject: Re: The United States is Broke
Posted: Sat 14 Aug , 2010 3:27 am
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Um no your not wrong C_G. If people knew how bad off most states are right now there would be a panic...I am not joking. New Mexico is beyond broke, so are surrounding states, it's bleak I mean really bad (I've seen the actual budgets). And at this point there is not much that can be done. If we don't as a collective whole as a United States pull our heads out we will be done in a short order of time. We will be an oligarchy fairly soon, I used to think it was about 50 years out...I'm not even giving it 5 now. And as for which party is in control, at this point I highly doubt it matters. We argued over who ran the boat into the iceberg and didn't do a damn thing to stop the boat from sinking, well it's past the tipping point now and going down. I'm just waiting on our Hitler to show up and he/she will and it's not Obama or Bush or anyone in the spot light now. We are there, make no mistake about that, we are Germany in the 30's.

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Cenedril_Gildinaur
Post subject: Re: The United States is Broke
Posted: Sat 28 Aug , 2010 1:53 am
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The final step is monetizing the debt.

Fed stands by to boost US growth
Quote:
Ben Bernanke said on Friday that the Federal Reserve stood ready to boost the flagging US economy and had the tools to do so, including increasing holdings of long-term assets such as Treasury bonds and other securities.
I know he's running out of options, but couldn't this have waited at least one more year?

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It is a myth that coercion is necessary in order to force people to get along together, but it is a persistent myth because it feeds a desire many people have. That desire is to be able to justify hurting people who have done nothing other than offend them in some way.

Last edited by Cenedril_Gildinaur on Tue Feb 30, 2026 13:61 am; edited 426 times in total


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Ara-anna
Post subject: Re: The United States is Broke
Posted: Sat 28 Aug , 2010 1:17 pm
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We hit the Hindenburg Theory twice on Thursday I think. Maybe it was once.



And Glenn Beck is handing out Kool-Aid in DC today!!!

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Dave_LF
Post subject: Re: The United States is Broke
Posted: Wed 08 Sep , 2010 3:31 pm
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What does the Fed do with bonds once it buys them? Sit on them until the government has more money (i.e. forever)?


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