MikeP
Orchestrator
Posts: 537
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Post by MikeP on Sept 29, 2008 17:33:32 GMT -8
Nate, are you paying attention to the actual voting numbers, or just interested in putting all the blame on democrats? If all the democrats voted 'yes', and all the republicans voted 'no', would you be singing the praises of the democrats and cursing the republicans for trying to ruin the bill? One thing I find funny is that people are citing some of the EXACT same reasons for their argument either for or against the bailout. Which one is actually going to cause inflation? If you pump 700 billion into the economy, inflation will occur. We are still experiencing some inflation from the previous bailout attempts and the Fed keeping the interest rates so low for so long, amongst other things. I have yet to be convinced that continuing on the same course of action is the right way. I'm not following the Oprah analogy. Please explain.
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MikeP
Orchestrator
Posts: 537
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Post by MikeP on Sept 29, 2008 17:40:51 GMT -8
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Post by Jangles on Sept 29, 2008 17:43:40 GMT -8
If you pump 700 billion into the economy, inflation will occur. Will it though? I don't know, which is why I'm asking I understand the basic principles about inflation, but I am unsure to EXACTLY where this 700 billion dollars would go. I don't think it is as simple as economy = economy + 700 billion I mean, it sounds like some people are chiding a child when they are talking about how it's a learning process that America needs to go through and how you can just slap it's hand and it won't happen again since after the recession blows past we will become wiser and learn from our mistakes. I guess maybe Dr Phil would have worked better? I don't know since I watch neither of them Isn't America built on credit and large finance institutions? I just don't think the above assumption has any merits in the real world.
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Post by muckle dabuckle on Sept 29, 2008 17:50:33 GMT -8
Nate, are you paying attention to the actual voting numbers, or just interested in putting all the blame on democrats? If all the democrats voted 'yes', and all the republicans voted 'no', would you be singing the praises of the democrats and cursing the republicans for trying to ruin the bill? I'm not blaming anyone. People are accusing the bill of failing because of the republicans even though the democrats could've passed it themselves. I'm telling people that say this that they are asses. It's not that hard to understand. They need to look at themselves instead of blaming others. I could just as easily blame the democrats for not voting in larger numbers against the bill. If no one started blaming one side over the other I never would've said anything. And if all the democrats voted "yes" we wouldn't be having this stupid argument because the bill would've passed.
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Post by natedogg23 on Sept 29, 2008 17:57:41 GMT -8
Let's see here. Inflation....many of the decisions already instituted by the GOVERNMENT (thank goodness we are looking to them for a good solution to the current problem) in the recent past has already caused inflation and created the problem we are now experiencing. The $700 billion dollar bailout they are discussing will cause a drastic increase in the money supply (not to mention all the money they have already created to pay for Fannie Mae, Freddie Mac, AIG, Auto companies, etc) which will create more inflation.
So we should reward bad decision making by giving them more money and hope they lend it out responsibly? If you reward poor decision making that doesn't give much incentive to change the way you approach the same situation. Even when considering the 'world economy' you must consider psychological impacts just as you would with a 5 year old child.
I don't agree with everything Ron Paul says, but he makes a whole lot more sense than most politicians. Not sure where you get the idea that he is 'so much better' when all he is doing is stating factual information and has been talking about this situation long before it actually happened. While I don't think he is a godsend, he has definitely grown his movement of liberty which is a lot better than the alternative of being a slave to the government. His campaign appeals to a lot more than just 'people in their 20's on the internet.' Although I guess if you don't like freedom and enjoy government controlling your lives I can see how you wouldn't like Ron Paul.
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Post by Jangles on Sept 29, 2008 18:10:07 GMT -8
I admit it - I was trolling a little bit with the Ron Paul paragraph Isn't the money coming from taxes, not made up money though? If so, would that really be inflation, or would it just be less government spending of out tax money on other stuff?
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Post by natedogg23 on Sept 29, 2008 18:20:18 GMT -8
Trying to float the idea of tax increases is political suicide usually(especially if you try to tell everyone that as part of this bailout they owe $4k to bailout poor decision making on wall street)......and if you really look into the fiat currency system that we use here in the US there really is no need for taxes at all cause the US can basically just create money. Taxes for the most part are used just as a political tool.
This could get into a whole bigger conversation about the Federal Reserve, but basically the government would just get into more debt to pay for the bailout which would lead to inflation (or put more simply, decrease in buying power).
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Post by Jens Dietrich on Sept 29, 2008 18:49:45 GMT -8
...and if you really look into the fiat currency system that we use here in the US there really is no need for taxes at all cause the US can basically just create money. I don't know whether to laugh or cry at this statement. You are seriously deluded, man.
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Post by natedogg23 on Sept 29, 2008 18:52:25 GMT -8
Well if you are going to make that statement towards me it would be nice if you expanded upon your comment so I can gain a better understanding of your comments.
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Post by Jangles on Sept 29, 2008 18:58:31 GMT -8
Yeah, but this is the internet, so that isn't unnecessary.
Honestly though, I still hope the DOW will be OVER 9000 come the end of week. It could get ugly...
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Post by muckle dabuckle on Sept 29, 2008 19:02:48 GMT -8
Isn't the money coming from taxes, not made up money though? If so, would that really be inflation, or would it just be less government spending of out tax money on other stuff? I'd like to know that as well. I literally can't get on the house website (all night). I also tried Barney Frank's website because he seemed to be one of the authors of the bill and I can't get on his site either (does anyone know the authors of the bill? I can't find that info anywhere). I was hoping to get an explanation at one of these places. Meh. It would seem if they could cut $700 billion from the budget overnight that we would pay off the national debt in 10 years, but obviously we won't be cutting anything. So I don't see where this money was supposed to come from. If they tax us for it they need to tax all 300 million of us about $3,000 literally tonight (because this is supposed to be a crisis). That obviously won't happen. In section 120 of the bill it talks about the sunset for this $700 billion to be the end of december next year. So if they passed the bill I'm assuming they would've had to find $700 billion sometime between now and then, but I thought this was a crisis? The sunset can have some years added to it so that would be until 2010 to come up with the $700 billion. So I don't see how that fixes anything now. Of course they'd just keep adding years to the sunset until it is permanent and then just keeping upping the $700 billion tab to pay for other things that aren't even related to the economy and then we have a new tax! Yay! I could be reading the bill wrong though (I thought the payment would be in increment chunks, not all $700 billion at once). I just skimmed it, which most likely everyone who voted on it did as well. Maybe they'll come up with a better bill on thursday that everyone can actually understand.
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Post by Jon Broxton on Sept 29, 2008 19:19:34 GMT -8
(Just came home from dinner and have been reading the rest of the thread since I last checked in - I don't have anything to contribute to the discussion right now, but I just wanted to commend everyone for being intelligent and civil - keep it up guys!
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Post by christopher on Sept 29, 2008 20:19:29 GMT -8
Thanks for this, Mike. This would be really hillarious if it wasn't so rediculous. See my comments earlier about rushing this first attempt. It doesn't sound like nearly as much thought was put into this as should have been.
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Post by Carlton the Barbarian on Sept 29, 2008 20:26:08 GMT -8
Let's see. The democrats have had the majority in the senate and house for two years. They decide who is on every committee. First, I don't think the Democrats get to decide which Republican members are on a particular committee. Second, the House is chaotic. Folks vote based on elections; They come every two years. So, for controversial bills, every member of a Party isn't going to jump onto an unpopular bill. Nate, in the Senate, the Democrats really don't have a majority. A bill doesn't pass without 60 votes, so there's basically been gridlock, and the Dem's have nowhere near the 3/4th's majority needed to override a veto... Nate, you can say that this bill failed because not all Democrats voted for it, but this bill really failed because it lost Republican support. Don't forget that this bill was basically done (set in motion/authored) by a Republican president and two of his appointments, his Treasury Secretary and the Chairman of the Federal Reserve. Congress came in afterword's and they worked on some revisions to the Bush's administration original proposal (see the Hook link.). As Joe said Republicans voted against the bill 2 to 1. This bill failed because it lacked Republican support. Btw, I'm glad it failed on its first attempt... So we should reward bad decision making by giving them more money and hope they lend it out responsibly? If you reward poor decision making that doesn't give much incentive to change the way you approach the same situation. Even when considering the 'world economy' you must consider psychological impacts just as you would with a 5 year old child. I have one question. What happens if the banks fail? How will the markets fixed failed banks? Isn't the government going to have to step in if this happens. I don't really don't think this is about rewarding bad decisions. It's more about fixing the bank situation, like Japan and Sweden tried to in the 1990's. www.nytimes.com/2008/09/29/business/29econ.html?ref=politicsIsn't the money coming from taxes, not made up money though? If so, would that really be inflation, or would it just be less government spending of out tax money on other stuff? I'd like to know that as well. I literally can't get on the house website (all night). I also tried Barney Frank's website because he seemed to be one of the authors of the bill and I can't get on his site either (does anyone know the authors of the bill? I can't find that info anywhere). I was hoping to get an explanation at one of these places. Meh. I think The 700 billion (or 350 billion, plus later installments) would come from Securities from the Federal Reserve along with the creation of some new monah! So, it would be coming from taxes and made up money, but I'm not exactly sure about this. I think the answer is here: www.thesurvivalpodcast.com/episode-61-questions-from-the-audience-on-the-700-billion-dollar-bail-out
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Post by natedogg23 on Sept 29, 2008 20:47:13 GMT -8
Interesting article in the NY Times Carlton, and as I stated before I don't have a full enough understanding just yet to have an answer to everything (I'm not so sure anyone really can) but here would be my reply. Banks are going to fail regardless, even with the bailout package the government will have a choice on which banks can participate or what stipulations they must follow to participate meaning they are making all the rules (can anyone say playing favorites ). Will more banks fail if the government doesn't pass a bailout package? Probably, but that allows those that were fiscally irresponsible to reap the consequences of their poor business decisions. In that case there are plenty of bankruptcy laws and proceedings to divest assets plus the FDIC would cover many of the losses of the depositors. OR just as in recent examples those companies that have been fiscally responsible reap the benefits of their strategies and get to gobble up failed banks assets at a discount. In the Japan example, even that article states that all the government intervention did was to postpone the inevitable. And even in the Sweden example they mention it isn't even a good comparison due to the difference in scale. The crazy thing is they want to put the taxpayers dollars on the line to bailout firms that made bad decisions and they aren't even sure if the plan will actually work. So if the plan doesn't work, just continue to bailout again and again......will the cycle ever end?
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