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Thread: The coming 'tsunami of debt' and financial crisis in America

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by MTAtech View Post
    In response to the portion above in bold, and not the rest of the diatribe, the U.S. apart from "clearly" pushing for default, America has no intention of defaulting at all. In fact, no sovereign nation with its own currency ever has to default. One can always monetize the debt buy paying off the debt with newly minted currency. But in the current case, U.S. debt is quite sustainable.

    We already have a centrist party, it's called the Democratic Party.

    Oh wow.....

    Is Japan going to " default " on its debt ?

    No, they can simply print currency to the point of wiping out the savings of every Japanese citizen while their economy crashes and burns.

    Believe it or not, there are REAL consequences to massive deficit spending for the purpose of fiscal stimulus.

    The middle class and the poor are the one's that have to suffer the consequences of these STUPID Liberal economic policies.

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by Fenton View Post
    Oh wow.....

    Is Japan going to " default " on its debt ?

    No, they can simply print currency to the point of wiping out the savings of every Japanese citizen while their economy crashes and burns.

    Believe it or not, there are REAL consequences to massive deficit spending for the purpose of fiscal stimulus.

    The middle class and the poor are the one's that have to suffer the consequences of these STUPID Liberal economic policies.
    Go ahead, please tell us the consequences to the middle class and the poor due to "massive deficit spending?" Much of that "massive deficit spending" was on extending unemployment insurance; Medicaid; and Food Stamps -- areas that the middle class and the poor needed during the economic downturn. Conservatives would have slashed these expenditures (and Republicans even did hold up extending unemployment until Obama extended the Bush tax-cuts for upper-income taxpayers -- so we know where conservatives truly stand, and it's not with the middle class and the poor.)

    Conservatives were telling us that this "massive deficit spending" would bring us high interest rates, inflation and debase the currency -- none of which have materialized. Meanwhile, the middle class and the poor received benefits that would have been slashed by conservative ideologues.
    "I never meant to say that the Conservatives are generally stupid. I meant to say that stupid people are generally Conservative. I believe that is so obviously and universally admitted a principle that I hardly think any gentleman will deny it." --J.S. Mill

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by MTAtech View Post
    You post is pretty much contrary to macro economics. When the economy is weak from too little demand, it is not only appropriate for government to use fiscal stimulus to boost demand but it is advisable. When these conditions exist, even the Broken Window Fallacy is not a fallacy.
    Macro Economic is just a hidden code word for the same old completely discredited Keynesian economics, it didn't work during the fool John Maynard Keynes lifetime, and its not working in it replay since 2008.

    John Maynard Keynes - Wikipedia, the free encyclopedia

    Keynesian economics - Wikipedia, the free encyclopedia

    Keynes was a self-serving, self-aggrandized idiot who destroyed the lives of 100s of Million of everyday common people.

    We do need spending, but not the inefficiency of Government Chosen Largess. We need to get freaken Government out of the way of the markets to allow investors to research and choose what economic activities will make money, which in turn will help everyone.

    Having the Government pick and chose activities by radical environmental or ethnocentric ideals is a recipe for getting 0.10 worth of benefit for the dollar at best!

    Worse, we are loaded to near junk bond status in National Debt, each new stimulus dollar we spend, pushes further into the realm that no one wants anything to do with the country; trade, advancing credit, education (why spend big bucks to go to school to learn from stupids), research and investment.

    Each additional dollar of National Debt reduces the economic activity in the country by several dollars, and it even worse when many of those "stimulus" dollars are going to China.

    There is not substitute for massive Industry! None!

    Get over it and get to work!

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by MTAtech View Post
    Go ahead, please tell us the consequences to the middle class and the poor due to "massive deficit spending?" Much of that "massive deficit spending" was on extending unemployment insurance; Medicaid; and Food Stamps -- areas that the middle class and the poor needed during the economic downturn. Conservatives would have slashed these expenditures (and Republicans even did hold up extending unemployment until Obama extended the Bush tax-cuts for upper-income taxpayers -- so we know where conservatives truly stand, and it's not with the middle class and the poor.)

    Conservatives were telling us that this "massive deficit spending" would bring us high interest rates, inflation and debase the currency -- none of which have materialized. Meanwhile, the middle class and the poor received benefits that would have been slashed by conservative ideologues.

    Thanks to unprecedented Monetary Stimulus Obama's massive amount of new debt is relatively cheap, for now.

    Its not difficult to understand the REAL motivations behind the FEDs perpetual pumping

    The lack of inflation is a direct indication of the failure of QE, as it was sold as a way to ward off " de-flation " as all this liquidity made it out into the economy.

    Well over 84 percent of all that liquidity is sitting on the FEDs books as " excess reserves "

    And the Middle Class is shrinking and is turning into the poor under Obama.

    That means they're qualifying for " benefits " that they wouldn't have needed had a competent leader been elected.

    Why you think thats worth bragging about is beyond me.

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by Hamster Buddha View Post
    Problem is the money would never be spent. If you recall, we had this sort of idea with the stimulus package, and that went no where.
    That's plainly wrong. Not only was the headline dollar figure of the ARRA distributed and spent in it's entirety, the portion of the ARRA devoted to infrastructure (too small a portion) and the bill as a whole was overly successful according to the broad majority of credible analysis.

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by Hamster Buddha View Post
    What does? The fact that unemployment is still crap (along with the rest of the economy
    The health of the labor market has seen a rather dramatic turnaround since its implementation, alongside many other key economic indicators. To suggest otherwise is a sign of denial or misinformation.

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by Kurmugeon View Post
    Macro Economic is just a hidden code word for the same old completely discredited Keynesian economics, it didn't work during the fool John Maynard Keynes lifetime, and its not working in it replay since 2008.

    John Maynard Keynes - Wikipedia, the free encyclopedia

    Keynesian economics - Wikipedia, the free encyclopedia

    Keynes was a self-serving, self-aggrandized idiot who destroyed the lives of 100s of Million of everyday common people.

    We do need spending, but not the inefficiency of Government Chosen Largess. We need to get freaken Government out of the way of the markets to allow investors to research and choose what economic activities will make money, which in turn will help everyone.

    Having the Government pick and chose activities by radical environmental or ethnocentric ideals is a recipe for getting 0.10 worth of benefit for the dollar at best!

    Worse, we are loaded to near junk bond status in National Debt, each new stimulus dollar we spend, pushes further into the realm that no one wants anything to do with the country; trade, advancing credit, education (why spend big bucks to go to school to learn from stupids), research and investment.

    Each additional dollar of National Debt reduces the economic activity in the country by several dollars, and it even worse when many of those "stimulus" dollars are going to China.

    There is not substitute for massive Industry! None!

    Get over it and get to work!

    -
    Several thoughts come to mind after reading the above post. 1) It represents economic illiteracy. (e.g. "Each additional dollar of National Debt reduces the economic activity in the country by several dollars, and it even worse when many of those "stimulus" dollars are going to China.") 2) It makes wild assertions (example: "Having the Government pick and chose activities by radical environmental or ethnocentric ideals is a recipe for getting 0.10 worth of benefit for the dollar at best!") which have nothing to do with Keynesian thought and uses figures clearly plucked from the air. 3) I can't understand why you even bothered to include two Wikipedia links that do not support the wild opinions in the post.

    The claim that U.S. securities are "near junk bond status in National Debt" is not only wrong it's strongly wrong. Corporations, individuals and governments are willing to accept record low interest rates for the privileged of lending the U.S. government money. In 2009 and 2010 they were willing to pay the U.S. negative interest to lend it money. The fact that they are willing to do so, without a risk-premium, means they have faith that the U.S. will repay the debt instrument.
    Last edited by MTAtech; 09-11-14 at 06:54 PM.
    "I never meant to say that the Conservatives are generally stupid. I meant to say that stupid people are generally Conservative. I believe that is so obviously and universally admitted a principle that I hardly think any gentleman will deny it." --J.S. Mill

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by Fenton View Post
    Thanks to unprecedented Monetary Stimulus Obama's massive amount of new debt is relatively cheap, for now.

    Its not difficult to understand the REAL motivations behind the FEDs perpetual pumping

    The lack of inflation is a direct indication of the failure of QE, as it was sold as a way to ward off " de-flation " as all this liquidity made it out into the economy.

    Well over 84 percent of all that liquidity is sitting on the FEDs books as " excess reserves "

    And the Middle Class is shrinking and is turning into the poor under Obama.

    That means they're qualifying for " benefits " that they wouldn't have needed had a competent leader been elected.

    Why you think thats worth bragging about is beyond me.
    Here, here. You are presenting a position that is remarkable. Conservatives were previously arguing that raising the money stock would be inflationary and, therefore, the QE program was a failure because it will cause high inflation. Now, since QE did not cause high inflation, you make the exact opposite argument -- QE is a failure because it did not cause inflation.

    If one is claiming that the middle class is shrinking and it is due to Obama policies, which policies might those be? What has happened over the last three decades in growing income inequality, with more and more income concentrated into the top class, which means less is available below. The latest data shows that "Average, or mean, pretax income for the wealthiest 10% of U.S. families rose 10% in 2013 from 2010, but families in the bottom 40% saw their average inflation-adjusted income decline over that period, according to the Fed's Survey of Consumer Finances, which is conducted every three years." Obama didn't cause that. That is the legacy of rolling back taxes on the rich going back to the Reagan years and made worse under Bush.
    Last edited by MTAtech; 09-11-14 at 07:12 PM.
    "I never meant to say that the Conservatives are generally stupid. I meant to say that stupid people are generally Conservative. I believe that is so obviously and universally admitted a principle that I hardly think any gentleman will deny it." --J.S. Mill

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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by jmotivator View Post
    I say we solve two problems at once and force all able bodied welfare recipients to work for their benefits on infrastructure renovation jobs. The New Deal would come full circle with the roads and bridges built by the welfare recipients of the Great Depression being fixed by the welfare recipients of the Great Recession. PROGRESS!!
    That's always been my thinking. Anyone who gets public money, unless they are demonstrably disabled, should be required to work at least 5 hours a day, 5 days a week to get a check. Otherwise, screw 'em. Maybe if we forced people to work for their money, they might get off their asses and get jobs.
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    Re: The coming 'tsunami of debt' and financial crisis in America

    Quote Originally Posted by jmotivator
    I say we solve two problems at once and force all able bodied welfare recipients to work for their benefits on infrastructure renovation jobs. The New Deal would come full circle with the roads and bridges built by the welfare recipients of the Great Depression being fixed by the welfare recipients of the Great Recession. PROGRESS!!
    There are problems with your simplistic solution. The first, is that there are three people looking for each job opening. The second, is that your view of "welfare" is a throughback to the 1970s. In 1996, the Personal Responsibility and Work Opportunity Act, was passed, which reduced aid to the poor and reformed your notion of welfare. You can read all about it here: Personal Responsibility and Work Opportunity Act - Wikipedia, the free encyclopedia

    However, what I don't understand is contradictory reasoning. Conservatives are arguing that the stimulus "didn't do anything" and government doesn't create jobs -- but the argument that I am now reading now is that they want a new WPA program to build roads and bridges. Well, we don't need such a program. Roads and bridges are now mainly built by private contractors, who have expertise in these types of projects. If the government wants to spend money to build a road, they need not use "welfare recipients." They let a contract and private companies hire workers. If demand for roads and other projects is great enough, unemployed workers apply for those jobs.
    "I never meant to say that the Conservatives are generally stupid. I meant to say that stupid people are generally Conservative. I believe that is so obviously and universally admitted a principle that I hardly think any gentleman will deny it." --J.S. Mill

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