Originally Posted by Shoblast
Oh My God (irony) THAT IS SUPERB
See, I've always maintained that Disney chicks should have glasses
Originally Posted by silent_man
Did anyone watch the vice presidential debate recently?
I didn't watch the first presidential debate, but i though this one was quite good.
To me, Joe Biden was clearly the winner, his 25 odd years of experience definitely showing. I think he really connected with the audience, his answers were good and well though of. As for Sarah Palin, she did better than expected i suppose, but she clung strongly to her strongest point-ENERGY. She constantly referred back to this, espousing her credentials; 'as the governor of Alaska.......'.It was quite boring at times.
Good job by both tickets, very enlightening debate.
Palin's like a high school girl stuttering her way through - refreshing change from the usual snarky politician
But well, it's between Tweedledee and Tweedledum. Though who governs is perhaps less important than what he's allowed to do - and unfortunately America is heading down the road to fascism.
Fascist America, in 10 easy steps
The Road to Serfdom - in comic form
Originally Posted by Smilehoe
Why is it undesirable with the approved bill? Bank deposit guarantee, reduction of foreclosures and stability seems to be helping the common americans as well.
Though we can't say that there will be no abuse of funds but with provisions for oversight and transparency, it could be managed and monitored for biases.
From what I gathered, the concerns are potential mispricing of the value of securities and the inflationary effects. One which could diminish the value of savings in bank which hurt the middle class most.
But still we could all be speculating from either way and overlook some potential factors which might show up in later stages. Anyway, the Emergency Economic Stabilization Act seemed to be too hastily drafted to account for careful consideration and studies.
There's nothing redeeming about the bill - Rome is burning and they just poured some gasoline to keep the party going. Oh boy.
The Paulson plan v2.0 is the biggest transfer of wealth from the poor to the rich in the history of mankind. My objection however is not because of this being a swindle of monstrous proportions, but it is not undergirded by sound economics. Government intervention to prevent the economic cycle run its course only makes the eventual correction process much worse, much longer and much more painful. This will only further weaken the economy, and accelerate the American dollar to ruin.
People far better than I have already commented much, so here's some links:
Bailout marks Karl Marx's comeback
Ron Paul on the Bailout
I do not generally like the idea of bank deposit guarantees (especially if they have high caps) - this only encourages banks to indulge in irresponsible behaviour and take greater risks with depositors' funds, since part of it (if not all) is guaranteed to be repaid by central banks. Moral hazard, as you've pointed out - this exempts them from the discipline of the market i.e. market regulation
Of course, banks are inherently insolvent under a fractional reserve system - e.g. America stipulates a reserve ratio of 10%, so if a bank receives a deposit of $1000 from Alice, it is legally allowed to lend out $900 from that deposit to Bob. So there are now two claims to the same $900 - if Bob defaults, the money is gone. Now, when there are a huge number of defaulters... you get the idea.
Bank runs expose such legalized fraud, since banks can at best only muster 10 percent of cash to meet their commitments. When there's bank deposit insurance in place, central banks would then hit the turbo button on their printing presses - to print out enough money to pay off all depositors. This however would spill over to the economy as hyperinflation, so depositors can only 'redeem' their savings by destroying their value.
It is sad that people believe that the financial crisis was abetted due to insufficient, or 'outdated', regulation - when the truth is that no aspect of this financial crisis was unregulated. You have the government, the Federal Reserve, the Treasury, the Securities and Exchange commission, various boards etc. all with their dazzling array of powers. It was REGULATION which directly engendered the problem, and what is truly needed right now is LESS regulation.
The banks are less culpable than they are made out to be - legislation was passed to force banks make credit available to people who wouldn't qualify under normal circumstances. No sane human would extend so many loans to bad risks unless they were forced to do so. The poor who were supposed to 'benefit' from this legislation are now worse off than before - government 'help' has now made them bankrupt, with no home, no money.
Some guy summarized the crisis as such:
1. In the event of massive economic failures, there can only be one real
villain: government together with central banks.
2. In an existence of uncertainty, there is some certainty: that government would continue to throw things out of whack, and if you're not careful you'll be sucked into the vortex as well.
3. The road to hell is paved with good intentions.