http://www.guardian.co.uk/business/2009/jan/28/putin-economy-davos-perfect-storm
Great read, there are a few different spins on this story through different news outlets depending on which side of the political coin you are on so I chose an article that seemed to be fairly objective.
Don I’m disappointed. I was expecting some tinfoil hat stuff, not a Russian leader saying reasonable things like “Hey we tried putting too much faith in the state and messing with the economy too much, don’t do that.”
:tup:
x2 minus the disappointed part.
If I was really old I would be so pissed that we came to a point in US history where the Russian Prime minister tells the USA to stop being socialist. Well, more angry than I am.
If you would of told me 30 years ago The Russians would be warning us of this I wouldn’t have beleived it. With this new bailout bill our debt is at 40% of our GDP, Europe is at 47%. So what is the official number of socialism 40%, 47% somewhere in between? The most important point he makes is about the borrowed prosperity.
“He admitted he had no answer to the current financial woes but called for a future economy to be based on “real values” and not “borrowed prosperity”.”
Well, that and the very first sentence.
It really is strange that we need to take a lesson from them. Sad really.
I think it is true though. If a business fails someone will always take its place if the market is there to support it.
There was a segment on CNN titled “US Socialism?” last night. I can’t find it on CNN’s website. Either way with the talks of nationalizing banks, I wonder what the government will do with GM if it goes bankrupt? Nationalize? We are in for a really interesting and potentially life changing time.
Haha… saw this posted on a right wing forum…
Scary stuff lol
I can’t be upset when a nation (granted, the name has changed several times) who has been around as long as Russia is just throwing out some advice to us. It does seem weird, but I think people forget that in comparison, we are one of (if not thee) youngest country on the planet. As long as we keep our ideals front and foremost we (hopefully) will work through it in the best intrest of the people
Like we care what a fascist thinks of our democracy. Fuck Putin.
objectivity, :tup:
:hay:
You mean “borrowed prosperity” is bad?
Cmon now…we have a market to prop up. :roflpicard:
So what should we do instead of a few million government funded jobs to get the economy going again? Let it spiral into a depression worse than the last one?
Lets give already wealthy corporations billions instead.
Or start a war… oh wait, we already tried that.
The thing is…the bailouts went to many broke companies, not wealthy ones. It’s sad because that punishes the strong savvy competitors that would have bought out the defunct companies shells with their own cash. That’s how free markets are supposed to operate. When fair value was achieved there would be buyers, the government should NOT be a buyer of private enterprise. There are job reductions because wages are too high…simple as that. Don’t misunderstand…a depression wouldn’t be fun, but it’s needed to level the playing field. For every BOOM there is an equal or worse BUST!
The war is a classic attempt to create spending. It worked very well for that purpose, but with every war comes an even steeper price to pay. Damaged soldiers and further hatred of the US by foreign people. And well of course the larger deficit. LOL
In terms of banks, unfortunately, the situation was bad enough that the strong savvy competitors that bought out the defunct companies inherited such a mess that they got into big trouble. Look at Bank of America. In terms of the portion of their portfolio that was their own, they were a little damaged, but overall fine, thanks to their huge deposit base. With all of the garbage they got from Countrywide and Merrill, they’re now in the second most trouble of anyone out there, behind Citi. There is NO financial institution that would be able to take on the shit from Citi or BAC and survive, short of the Federal Reserve bank.
I respect your points though I’m not sure I agree entirely. They now own all the foreclosed homes. They treat things as if the houses are a total write off. There is significant value in each and every foreclosed house. Auction them off sooner than later and the damage is much less. The game where they made people feel the “sky was falling” was most damaging aspect and intentional IMO. In the end the banks end up with property, free government/tax payers money and the right to turn the new money into mounds of debt again via fractional divisional lending. What are they out? They are out defaulted debt that was inflated and never really existed anyhow. Plus they can take that free money and invest in the paper markets. Rinse n’ repeat, same cycle that’s gone on forever it seems.
I realize there’s much more to the picture, more than even pro economists can fathom. But if we look at the actions of the banks they had to realize the bubble would eventually pop. A boom followed by a bust…same way it’s always been. They control the paper markets and they now control or manipulate the hard markets via derivative contracts. It’s just one big game.
This is the greed enabling flaw of fractional reserve lending. Now how do they cook the books to hide the writeoffs and build confidence again?
Just my thoughts anyhow. 