View Poll Results: Which party is more responsible for the state of the economy?

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  • The Republican Party

    41 62.12%
  • The Democratic Party

    25 37.88%
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Thread: Which party is more responsible for the state economy?

  1. #121
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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Catawba View Post
    Loss of people's life savings by wild speculation and trillions of dollars in bailouts to banks to big to fail. The repeal of the Glass-Steagall Act in 1999 was a precursor to the financial speculation leading to the housing bust and a deep U.S. recession. HR 1489- Prudent Banking Act of 2011 separates commercial banking from investment banking and would once again prevent banks from doing business on wall street, and the other way around.
    Regarding the loss of people's life savings: Lord Tamerlain and I discussed this above. My contention is that Glass-Steagall is just nibbling around the edges of the problem, and it is fractional reserve banking that puts depositors money at risk. Sure, Glass-Steagall can try to mitigate the risk banks take, but the underlying fact of the matter is that banks are risking depositors rent and grocery money as soon as they use it for their own investments.

    You can go ahead and pass Glass-Steagall, but until fractional reserve banking is eliminated, depositors money will always be at risk.

    Regarding bailing out the banks: They should have been allowed to fail. The fear of failure tempers greed. If the government bankrolls the banks, they lose their fear of failure and become ever more reckless, eventually requiring more and bigger bailouts. The free market is a profit and loss system. Without losses, it's just crony capitalism.

  2. #122
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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Centinel View Post
    Regarding the loss of people's life savings: Lord Tamerlain and I discussed this above. My contention is that Glass-Steagall is just nibbling around the edges of the problem, and it is fractional reserve banking that puts depositors money at risk. Sure, Glass-Steagall can try to mitigate the risk banks take, but the underlying fact of the matter is that banks are risking depositors rent and grocery money as soon as they use it for their own investments.

    You can go ahead and pass Glass-Steagall, but until fractional reserve banking is eliminated, depositors money will always be at risk.
    I agree with Lord Tamerlain on that.

    Regarding bailing out the banks: They should have been allowed to fail. The fear of failure tempers greed. If the government bankrolls the banks, they lose their fear of failure and become ever more reckless, eventually requiring more and bigger bailouts. The free market is a profit and loss system. Without losses, it's just crony capitalism.
    If the investment banks were not combined with commercial banks I would agree. That is why OWS and I support HR 1489, to again establish the firewall between the two, so taxpayers won't be put in that position again.
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  3. #123
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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Catawba View Post
    If the investment banks were not combined with commercial banks I would agree. That is why OWS and I support HR 1489, to again establish the firewall between the two, so taxpayers won't be put in that position again.
    It is inflationary monetary policy and fractional reserve banking that caused the collapse. You can try various regulations, of course, but depositors money will never be secure until they can deposit in a bank that holds 100% of it.

    I'd support HR 1489, if it also contained language to gradually phase out fractional reserve deposit banking over time (excluding time deposit accounts) and established a regulation specifying a given quantity of gold or silver as the monetary unit of account for the US.

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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Centinel View Post
    It is inflationary monetary policy and fractional reserve banking that caused the collapse. You can try various regulations, of course, but depositors money will never be secure until they can deposit in a bank that holds 100% of it.

    I'd support HR 1489, if it also contained language to gradually phase out fractional reserve deposit banking over time (excluding time deposit accounts) and established a regulation specifying a given quantity of gold or silver as the monetary unit of account for the US.
    The evidence is just not there to support your opinion:


    US Inflation by Decade Chart

    "In the fall of 2008, the U.S. economy stood on the brink of collapse. Part of the reason is that the financial system, particularly the commercial and investment banks, had been deregulated starting in 1980 and culminating in 1999. In 1999, the Glass-Steagall Act was repealed. The Glass-Steagall Act separated the powers of commercial and investment banking, which insured that banks would not take too much risk with depositors' money."

    "After the repeal of Glass-Steagall, greed won out over prudence and banks did indeed take too much risk with their depositors' money. Between 1999 and 2008, Wall Street became less like the fabled financial district and more like the Las Vegas Strip. Even the regulation that still existed didn't seem to be working."

    "The housing market, before the Great Recession, was moving full steam ahead and borrowers who couldn't really afford large home mortgages borrowed money anyway for mortgages. Big banks put these mortgages together into packages of securities of derivatives, called credit default swaps, which became the toxic assets that we would later hear so much about. The derivatives market is not regulated so banks could slice and dice these home mortgages into packages of derivatives just about any way they wanted.

    Enter Senator Phil Gramm once again. In 2000, Senator Gramm put a provision in legislation that was passed, the Commodity Futures Modernization Act, exempting credit default swaps from regulation.

    A perfect storm ensued with a phenomenon called sub-prime mortgages. Even those people who really didn't qualify for large mortgages started being approved for those mortgages. Countrywide Mortgage and its founder, Angelo Mozilo, was one of the biggest offenders. The traditional disclosure required of borrowers was not required and Countrywide was making mortgages to just about anyone who walked in the door. Dick Fuld, who was at the helm of Lehman Brothers when it failed, invested in huge amounts of subprime mortgages as did the government agencies, Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac were later bailed out because of this decision. Lehman Brothers was one of the largest failures of a financial firm in history."
    How do we Prevent Another Financial Crisis?
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  5. #125
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    Re: Which party is more responsible for the state economy?

    Is it true that Sen. Obama offered to help Sen. Dodd with a threatened filibuster to reforms of Fannie and Freddie? Does anyone have a link?
    If you expect people to be rational, you aren't being rational.

  6. #126
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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Catawba View Post
    The evidence is just not there to support your opinion:


    US Inflation by Decade Chart

    "In the fall of 2008, the U.S. economy stood on the brink of collapse. Part of the reason is that the financial system, particularly the commercial and investment banks, had been deregulated starting in 1980 and culminating in 1999. In 1999, the Glass-Steagall Act was repealed. The Glass-Steagall Act separated the powers of commercial and investment banking, which insured that banks would not take too much risk with depositors' money."

    "After the repeal of Glass-Steagall, greed won out over prudence and banks did indeed take too much risk with their depositors' money. Between 1999 and 2008, Wall Street became less like the fabled financial district and more like the Las Vegas Strip. Even the regulation that still existed didn't seem to be working."

    "The housing market, before the Great Recession, was moving full steam ahead and borrowers who couldn't really afford large home mortgages borrowed money anyway for mortgages. Big banks put these mortgages together into packages of securities of derivatives, called credit default swaps, which became the toxic assets that we would later hear so much about. The derivatives market is not regulated so banks could slice and dice these home mortgages into packages of derivatives just about any way they wanted.

    Enter Senator Phil Gramm once again. In 2000, Senator Gramm put a provision in legislation that was passed, the Commodity Futures Modernization Act, exempting credit default swaps from regulation.

    A perfect storm ensued with a phenomenon called sub-prime mortgages. Even those people who really didn't qualify for large mortgages started being approved for those mortgages. Countrywide Mortgage and its founder, Angelo Mozilo, was one of the biggest offenders. The traditional disclosure required of borrowers was not required and Countrywide was making mortgages to just about anyone who walked in the door. Dick Fuld, who was at the helm of Lehman Brothers when it failed, invested in huge amounts of subprime mortgages as did the government agencies, Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac were later bailed out because of this decision. Lehman Brothers was one of the largest failures of a financial firm in history."
    How do we Prevent Another Financial Crisis?
    I was talking about monetary inflation, not price inflation.

    Last edited by Centinel; 11-08-11 at 06:42 PM.

  7. #127
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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Centinel View Post
    I was talking about monetary inflation, not price inflation.

    Doesn't monetary inflation cause price inflation?
    Treat the earth well: it was not given to you by your parents, it was loaned to you by your children. We do not inherit the Earth from our Ancestors, we borrow it from our Children. ~ Ancient American Indian Proverb

  8. #128
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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Catawba View Post
    Doesn't monetary inflation cause price inflation?
    Yes, ceteris paribus.

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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Centinel View Post
    Yes, ceteris paribus.
    And how is price inflation compared with the historical average?

    http://www.debatepolitics.com/polls/...post1059939082
    Treat the earth well: it was not given to you by your parents, it was loaned to you by your children. We do not inherit the Earth from our Ancestors, we borrow it from our Children. ~ Ancient American Indian Proverb

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    Re: Which party is more responsible for the state economy?

    Quote Originally Posted by Catawba View Post
    And how is price inflation compared with the historical average?

    http://www.debatepolitics.com/polls/...post1059939082
    Ceteris paribus.

    Was everything else held equal?

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