EPTThese people got rich from the privatization of some state-owned organizations and their political ties that allowed them to exploit it. Oil sheikhs came from their discovery of oil. It's a different situation.
[Politics] Peter Schiff - Page 5
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ghostWriter
United States3302 Posts
These people got rich from the privatization of some state-owned organizations and their political ties that allowed them to exploit it. Oil sheikhs came from their discovery of oil. It's a different situation. | ||
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StorkHwaiting
United States3465 Posts
On January 09 2010 17:50 TOloseGT wrote: I'd just like to thank many of the educators on TL for giving us less knowledgeable people a chance to experience topics we would otherwise not have touched with a ten foot pole. However, I'm not sure whether its the videos of ignorant TV hosts or whether its the doomsayers, but I'm seriously scared for my future and the future of the U.S. I've known for a while now about the rampant consumerism and the raging debt and how "fortunate" we've been for the past couple of decades, but I will be graduating this summer and will hopefully enter the white collar labor market soon after, and my actual life will begin, so to speak. I would like to fatten my savings and raise a family in fashion similar to how I was raised when my parents moved here, but I suspect that won't be the case. It all seems like everything I will do in the future will not save me in the slightest from the ill-management of the Fed, and thus from an imminent collapse of society as we know it. Should I be scared? Hey GT, It's hard to say at this point which way the US will swing. Things could get real ugly or things could cruise along with this broken system for another 30 years. Then there's another group who believe that we're just riding the gravy train long enough to hit the next technological revolution. Remember, the only thing that truly expands the economic pie in a meaningful way is technological or organizational progress. AKA either a massive leap in productivity, or a massive leap in efficiency. Computers were a leap in both productivity and efficiency, which has fueled much of the boom in the 80's. We've kind of tapped that out now along with all the leveraging of US currency, but hey, maybe we can keep doing this dirty game until they come up with a new, just as revolutionary technology. If you are interested in diversifying and lowering your exposure to the US economy, I'd suggest investing in some foreign things when you start making a real salary. Do some research, purchase some currencies of other nations that have a good record and do not rely on huge reserves of US currency. I'm a huge fan of commodities as well. Gold and silver are big winners in my book. If you put money in those, it'll hold most of its value and will insulate you in case the US dollar does have a massive drop in value. Platinum's good too, but I think it's a bit more volatile because there's a smaller amount of it in the world (hence the higher price than gold) and it's used in certain industries, which could find a different material to use, thus lowering platinum's price. Gold's still the bread and butter. There's oil, which is too overspeculated in my opinion. All kinds of commodities really. But I'd say gold/silver are the two best for just safety purposes. US treasury bonds used to be the safest investment for people trying to insulate themselves from risk, but it's sad how badly that's deteriorated nowadays. | ||
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StorkHwaiting
United States3465 Posts
On January 10 2010 03:33 ghostWriter wrote: I didn't say that they had a free market economy. I said they experimented with free-market policies. It's completely different, I don't know where you get off trying to equate the two. These people got rich from the privatization of some state-owned organizations and their political ties that allowed them to exploit it. Oil sheikhs came from their discovery of oil. It's a different situation. There is nothing remotely "free" about what Russia and China did. They created markets where there were none before. Anyone would get rich doing that. Liberalization of markets is not FREE market. The vast majority of Chinese companies that developed "privately" aren't private at all. They're consistently run by government officials, or under the guidance of the government, and with a massive amount of subsidies, along with the manipulation of Chinese currency which eliminates any possibility of free market whatsoever. How much do you actually know about how China developed under Deng Xiaoping? Are you just reading about "McDonaldization of China" in a textbook and then going "oh yeah, free market baby." P.S. Oil sheikhs got rich because they had political ties that allowed them to exploit the oil in their country. Much like how a lot of Russians got rich because they had political ties that allowed them to exploit oil and natural gas in their country...It's kind of the same situation. | ||
TanGeng
Sanya12364 Posts
You got a warped sense of moral imperative. There is no way to compare the business institutions to a sick dehydrating individual because there is no moral imperative to save defunct organizations of men. So what if a few business go out of business?? Is the survival of these organizations sine qua non? Rather not, it's the jobs that that get displaced. Once we focus on jobs, then the question is whether or not the jobs being done are worthwhile, profitable, good contributions to society, etc. When there is a failed business model in play, the answer is unequivocally no. Those jobs should not have been kept. People don't have jobs just for the sake of having jobs. They work in order to create wealth. As for the series of bailouts you have to look at it this way. Wall Street has basically built a huge house on top of a really flawed foundation. The foundation is starting to crumble. The dilemma is do we the Taxpayers pour tons and tons of monies and materials to fix their foundation or do we tell Wall Street to take apart their house, salvage what they can, and build on more solid foundations? Now in the end, taxpapers would have bailed out the banks in one way or another, but many more firms should have been railroaded through bankruptcy rather than bailout. So there would be more of a moment of panic where everyone thinks the sky is failing, but there will be a good panic, too, a mad dash to figure out which businesses are good which businesses are bad, what went wrong, and never do it again. | ||
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StorkHwaiting
United States3465 Posts
On January 10 2010 03:56 TanGeng wrote: StorkHwaiting, You got a warped sense of moral imperative. There is no way to compare the business institutions to a sick dehydrating individual because there is no moral imperative to save defunct organizations of men. So what if a few business go out of business?? Is the survival of these organizations sine qua non? Rather not, it's the jobs that that get displaced. Once we focus on jobs, then the question is whether or not the jobs being done are worthwhile, profitable, good contributions to society, etc. When there is a failed business model in play, the answer is unequivocally no. Those jobs should not have been kept. People don't have jobs just for the sake of having jobs. They work in order to create wealth. As for the series of bailouts you have to look at it this way. Wall Street has basically built a huge house on top of a really flawed foundation. The foundation is starting to crumble. The dilemma is do we the Taxpayers pour tons and tons of monies and materials to fix their foundation or do we tell Wall Street to take apart their house, salvage what they can, and build on more solid foundations? Now in the end, taxpapers would have bailed out the banks in one way or another, but many more firms should have been railroaded through bankruptcy rather than bailout. So there would be more of a moment of panic where everyone thinks the sky is failing, but there will be a good panic, too, a mad dash to figure out which businesses are good which businesses are bad, what went wrong, and never do it again. You don't seem to realize it wasn't a few banks. It was the entire banking industry AND the government all leveraged to the hilt. It'd be really nice if every major bank went out of business right? Do you realize that if all those banks went out of business, the government would have ended up paying even MORE money? It's called FDIC insured dude. The bailout would have been all the deposits on paper at all the banks rather than the $400 billion it has costed. The bailout was a cheap band aid. The alternatives were even more costly. The "flaws" are the very foundations of the banking system and valuation system. Saying, lets just have all this crap sort itself out in the free market is not a solution. That's like saying my body's immune system will take care of cancer, no worries. The best fix would be getting rid of Fed and fiat currency IMO, but that's a drastic change and we're in the middle of recession/war. | ||
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TanGeng
Sanya12364 Posts
On January 10 2010 03:42 StorkHwaiting wrote: There is nothing remotely "free" about what Russia and China did. They created markets where there were none before. Anyone would get rich doing that. Liberalization of markets is not FREE market. The vast majority of Chinese companies that developed "privately" aren't private at all. They're consistently run by government officials, or under the guidance of the government, and with a massive amount of subsidies, along with the manipulation of Chinese currency which eliminates any possibility of free market whatsoever. How much do you actually know about how China developed under Deng Xiaoping? Are you just reading about "McDonaldization of China" in a textbook and then going "oh yeah, free market baby." P.S. Oil sheikhs got rich because they had political ties that allowed them to exploit the oil in their country. Much like how a lot of Russians got rich because they had political ties that allowed them to exploit oil and natural gas in their country...It's kind of the same situation. Actually quite to the contrary, there is plenty of free market in China. It's just not evident in the big companies. Most Chinese transactions are away from the eye of the Communist government in cash payments. The best examples of Chinese capitalism are the rural farming communities, street vendors, open air markets, and services oriented businesses being run out of people's homes. The point of control by the Communist government was primarily through banks and their lending practices. This largely limits the Party control of the economy to the large glamorous capital intensive ventures like large scale factories, construction, and high tech investment. The Chinese economy isn't a perfect free economy, but the majority of its transactions are, and that's more than can be said for nearly any other country in the world. | ||
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TanGeng
Sanya12364 Posts
On January 10 2010 04:09 StorkHwaiting wrote: You don't seem to realize it wasn't a few banks. It was the entire banking industry AND the government all leveraged to the hilt. It'd be really nice if every major bank went out of business right? Do you realize that if all those banks went out of business, the government would have ended up paying even MORE money? It's called FDIC insured dude. The bailout would have been all the deposits on paper at all the banks rather than the $400 billion it has costed. The bailout was a cheap band aid. The alternatives were even more costly. The "flaws" are the very foundations of the banking system and valuation system. Saying, lets just have all this crap sort itself out in the free market is not a solution. That's like saying my body's immune system will take care of cancer, no worries. The best fix would be getting rid of Fed and fiat currency IMO, but that's a drastic change and we're in the middle of recession/war. Not all banks were terrible, and many of the larger banks would have just been split up and sold, and as far as total bailout costs, you still have no clue what it will cost in the end. $400 billion? Where are you getting your numbers from kiddo. There's TARP, Stimulus, and Federal Reserve activities. You won't find out the true cost of the bailout until the Fed opens up its balance sheet. I'm betting that it's over 3 trillion. | ||
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StorkHwaiting
United States3465 Posts
On January 10 2010 04:10 TanGeng wrote: Actually quite to the contrary, there is plenty of free market in China. It's just not evident in the big companies. Most Chinese transactions are away from the eye of the Communist government in cash payments. The best examples of Chinese capitalism are the rural farming communities, street vendors, open air markets, and services oriented businesses being run out of people's homes. The point of control by the Communist government was primarily through banks and their lending practices. This largely limits the Party control of the economy to the large glamorous capital intensive ventures like large scale factories, construction, and high tech investment. The Chinese economy isn't a perfect free economy, but the majority of its transactions are, and that's more than can be said for nearly any other country in the world. While what you say is true, it's not at all what ghostwriter was talking about. He is talking about them in terms of national economies and specifically focusing on the large industries you're mentioning are state-run. Also, when you say "majority of Chinese transactions," you may mean in volume, but in dollar value it's far from the majority. I can't give you a specific number for obvious reasons, but just because there are a lot of people doing it doesn't mean it constitutes a large percentage of China's GDP. | ||
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ghostWriter
United States3302 Posts
On January 10 2010 03:42 StorkHwaiting wrote: There is nothing remotely "free" about what Russia and China did. They created markets where there were none before. Anyone would get rich doing that. Liberalization of markets is not FREE market. The vast majority of Chinese companies that developed "privately" aren't private at all. They're consistently run by government officials, or under the guidance of the government, and with a massive amount of subsidies, along with the manipulation of Chinese currency which eliminates any possibility of free market whatsoever. How much do you actually know about how China developed under Deng Xiaoping? Are you just reading about "McDonaldization of China" in a textbook and then going "oh yeah, free market baby." P.S. Oil sheikhs got rich because they had political ties that allowed them to exploit the oil in their country. Much like how a lot of Russians got rich because they had political ties that allowed them to exploit oil and natural gas in their country...It's kind of the same situation. You're repeating everything I'm said and trying to make it sound like I said something else. I never said they had a free market and this is the second time I'm repeating this statement. Hopefully, you'll read it this time. For someone who claims that he's a writer, you're pretty bad at reading. Also, family ties and political ties aren't the same thing, but yeah I guess it is the same situation. | ||
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Catch]22
Sweden2683 Posts
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StorkHwaiting
United States3465 Posts
On January 10 2010 04:15 TanGeng wrote: Not all banks were terrible, and many of the larger banks would have just been split up and sold, and as far as total bailout costs, you still have no clue what it will cost in the end. $400 billion? Where are you getting your numbers from kiddo. There's TARP, Stimulus, and Federal Reserve activities. You won't find out the true cost of the bailout until the Fed opens up its balance sheet. I'm betting that it's over 3 trillion. You know what the true cost is, kiddo? Nothing. Coz it's all funny money. How's that? Further, you're starting to just lump shit together. Define "Stimulus." Define "Federal Reserve activities." You're listing these things as if all of them are directly related to the bailout. They're not. The bailout is what it is. Don't try to fudge things by bringing in all kinds of unrelated factors. You think if they didn't bail out the banks, they wouldn't have put together a stimulus package? And the Fed would have altogether ceased its activities? It's impossible for you to put a dollar amount on every major move that was directly related to the banking crisis. And much of what goes on at the Fed are normal, routine activities that they would do to finance the war or control monetary policy. Trying to put a "cost" on the Fed's activities is nonsensical. The only way to tell the cost is by looking at inflation/CPI. And I can guarantee you inflation would have risen dramatically if the world financial markets watched Citigroup, Goldman Sachs, Chase, and BofA go in the shitter. | ||
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TanGeng
Sanya12364 Posts
On January 10 2010 04:26 StorkHwaiting wrote: You know what the true cost is, kiddo? Nothing. Coz it's all funny money. How's that? Further, you're starting to just lump shit together. Define "Stimulus." Define "Federal Reserve activities." You're listing these things as if all of them are directly related to the bailout. They're not. The bailout is what it is. Don't try to fudge things by bringing in all kinds of unrelated factors. You think if they didn't bail out the banks, they wouldn't have put together a stimulus package? And the Fed would have altogether ceased its activities? It's impossible for you to put a dollar amount on every major move that was directly related to the banking crisis. And much of what goes on at the Fed are normal, routine activities that they would do to finance the war or control monetary policy. Trying to put a "cost" on the Fed's activities is nonsensical. The only way to tell the cost is by looking at inflation/CPI. And I can guarantee you inflation would have risen dramatically if the world financial markets watched Citigroup, Goldman Sachs, Chase, and BofA go in the shitter. The primary point is that considering the magnitude of the specific "Bailout" of $400 billion. It couldn't have stopped the domino of bankruptcies that you think would have happened on its own right. Since that's the case, your $400 billion dollars has done nothing at all. Or are you trying to argue that the measly $400 billion stopped all of that from happening. HAHAHAHAHAHA | ||
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StorkHwaiting
United States3465 Posts
It's been shown time and time again that a perfectly free economy does not work without a huge amount of repression and vast inequalities between the poor and the rich. This is your original statement. Don't say I lack reading comprehension when you can't even keep track of your own words. This statement does not equal "China dabbled in free market policies." | ||
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StorkHwaiting
United States3465 Posts
On January 10 2010 04:31 TanGeng wrote: The primary point is that considering the magnitude of the specific "Bailout" of $400 billion. It couldn't have stopped the domino of bankruptcies that you think would have happened on its own right. Since that's the case, your $400 billion dollars has done nothing at all. Or are you trying to argue that the measly $400 billion stopped all of that from happening. HAHAHAHAHAHA It did stop a collapse. Why are you laughing? These banks weren't horribly insolvent, they just got caught without any cash on hand. You do realize that banks need cash to make money right? The bailout gave them the little bit they needed to get things rolling again, then they were back to making money, doing mergers etc and stretching things out so they didn't get hit by all of the losses at once. What the Fed did was keep interest rates low and issue bonds to pay for the bailout. Yeah, I'm sure that's going to cost 3 trillion dollars. Especially considering half the TARP funds aren't even used and a great deal of it is being paid back. This is probably my last post to you because you've shown very little understand of economics and you've acted immature with your all caps screaming and HAHHAHAs. Don't be a monkey if you want people to respect what you say. | ||
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ghostWriter
United States3302 Posts
On January 10 2010 04:35 StorkHwaiting wrote: ghostWriter: This is your original statement. Don't say I lack reading comprehension when you can't even keep track of your own words. This statement does not equal "China dabbled in free market policies." I said a perfectly free economy doesn't work. I said they tried some free market tactics. I also said that a perfectly free economy is impossible. Keep track of my words if you're able to look up and read what I wrote. | ||
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StorkHwaiting
United States3465 Posts
You even listed a bunch of countries as if they're examples of free markets. Afterwords, you appended that to "they tried free market tactics." Kind of weak, tbh. | ||
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ghostWriter
United States3302 Posts
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7Strife
United States104 Posts
On January 09 2010 12:38 StorkHwaiting wrote: And, personally, on the issue of currency I'm a strong believer in money backed by some real good. Be it gold, oil, whatever. There need to be reserves that the currency can be redeemed for. Fiat currency is artificial and that's why it can be manipulated so heavily. It has no basis in reality. I agree with you, there needs to be innovation in currency. It is illegal in the US and most of the world to use different types of currency. There should be no restriction on the government deciding what has value and what doesn't. We need to rethink the idea of currency for the digital age, where you can have competing trusted organizations that can virtually represent rarity. We once used gold, silver, or sea shells because they were finite scalable substances in demand that we gave value, but data in the form of base ten digits on protected servers could do the same thing. PayPal already does this but that is further backed by the dollar, or whatever it might be in that country. There has to be a lot of competition within the market and proper safeguards (that we all can understand) enacted but it will work. Then you won't have governments or organizations flooding and inflating their currencies out of greed. | ||
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SnK-Arcbound
United States4423 Posts
On January 10 2010 03:20 StorkHwaiting wrote: I highly doubt you understand how liquidity actually operates in an economy. Otherwise, you probably wouldn't be here quoting basic definitions and expecting them to prove anything. Liquidity is a measurement of how accessible cash is in the market. The entire point of liquidity is that if there's no freaking cash available, it's going to be pretty hard to trade your assets in for cash. Get it? It's sort of like me saying a sword is a weapon and then you disagree with me because you think it's only a sharp object. Liquidity isn't how accessible cash is in a market, read it's definition. Liquidity: the ability or ease with which assets can be converted into cash. There is no other definition of liquidity, unless you're reading someone making it up (read: You). Cash and cash substitutes are considered equal in liquidity. What you are saying is cash is the only way to measure liquidity, which is entirely false. It's like you saying a sword is the only weapon in the world because nothing else is as sharp. A house can be as liquid as cash, depending on the discount you are willing to sell it at. There could be an unlimited amount of cash, but if all my AR are bad debt, they will have no liquidity. | ||
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StorkHwaiting
United States3465 Posts
On January 10 2010 07:05 SnK-Arcbound wrote: Liquidity isn't how accessible cash is in a market, read it's definition. Liquidity: the ability or ease with which assets can be converted into cash. There is no other definition of liquidity, unless you're reading someone making it up (read: You). Cash and cash substitutes are considered equal in liquidity. What you are saying is cash is the only way to measure liquidity, which is entirely false. It's like you saying a sword is the only weapon in the world because nothing else is as sharp. A house can be as liquid as cash, depending on the discount you are willing to sell it at. There could be an unlimited amount of cash, but if all my AR are bad debt, they will have no liquidity. Thanks, Econ 101. When you get to Econ 401, maybe you can come back and have this conversation over again. | ||
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