Posted on 09/25/2008 12:25:31 AM PDT by Freedom_Is_Not_Free
Human suffering became a reality for millions of Americans as the depression continued. Many died of disease resulting from malnutrition. Thousands lost their home because they could not pay the mortgage. In 1932,at least 25,000 families,and more than 200,000 young people wandered through the country seeking food,clothing,shelter,and a job.
Many of the young people traveled in freight trains,and lived near train yards called hobo jungles. The homeless,jobless travelers obtained food from welfare agencies,or religious missions in town along the way. Most of their meals consisted of soup,beans,or stew and had very little nourishment. The travelers begged for food,or stole it if they could not get something to eat. They even ate scraps of food from garbage cans.
The ragged travelers found clothing even harder to obtain than food. Missions gave most of the clothing they had to the needy local people. Many of the travelers became very ill because they did not have food,or proper clothing. Even the sick wanderers had trouble getting help because the hospitals aided local residents first.
I don’t think 700 billion right now is the right thing to do but something has to be done.
I was at an accounting association meeting last night. We had two speakers from a nearby fortune 500 corporation speaking about cash management. They was responsible for the daily cash transactions that allowed the company to function daily.
They said that the day or so that the crisis on Wall Street blew up was one of the most stressful in their careers. They had one hell of a time getting banks to lend those days.
Now this is trade debt, it would be pocket change when compared to the assets of this corporation but if they don’t have assess to borrow that money then they may have to delay contracts or payments to suppliers.
Now this is a very conservative manufacturing company, bonds are always rated the highest. They won’t go bankrupt because the money markets has gone to pot but when it and thousands of other major corporations in America find they have a hard time borrowing cash then that affects thousands of smaller suppliers more harshly as sales to those larger corporations are delayed or cut back. Soon you start a cascade effect that causes a recession.
How do you field dress a horse? :)
Yes, that’s why my only conclusion is that the “let’s the chips fall” people are in deep denial about how bad this thing is.
>> deep denial about how bad this thing is.
So in other words, the $700 billion isn’t going to fix it, right?
I honestly don’t know. I have no clue. We are in completely uncharted waters with this liquidity crisis.
On one hand, nobody can be sure any solution will work, form printing $700 billion to bailout the banks, to forcing them to collapse. Nobody knows. All I know is, money is to financial system as blood is the human body. If is not breathing but has a pulse, you have some chance to bring him back to healthy. If he has no pulse, your odds are VERY slim he will not die.
Right now, money is still flowing. It is binding, jamming and slowing down, but still flowing. As long as we can keep it flowing, we stand a chance of fixing the economy. Once a big run on the banks comes from panic by the public and the big institutional investors, everything will come to a screeching halt in the financial system and in the economy.
And like trying to defibrillate a human heart, the financial system is equally difficult to re-start. Once people think they will lose all their money if they pull it out of the mattress, you have total collapse.
So I have no clue if this will work. I’m even concerned that this is some kind of closet payoff to Paulson’s pals before the inevitable depression occurs, so they have a soft landing.
I personally believe politicians don’t want to live through a depression or see one in their lifetimes, even though they would likely ride it out better than most of us. If you keep a job all through a depression, you aren’t really all that bad off. You will have a roof and nutritious meals. The problem is, so many people are unemployed without a roof or an ability to get meals. And the survivors with jobs are just on the edge of surviving.
During a depression, everything deflates so you can be sure wages will plunge as your employer says, “sorry, our profits are slim and this is all I can afford to pay you.”
If you aren’t a hot shot actor or athlete, or living on old money, you suffer. Workers suffer a little, the unemployed suffer catastrophically. THIS CAN STILL HAPPEN IN MODERN SOCIETY.
So I conclude the politicians don’t want this. They are greedy, powerhungry, egotistical bastards, but they aren’t stupid. A Depression helps no one but a few very rich vultures who can buy assets for pennies on the dollar. Politicians are not among those very rich vultures.
Will the bailout work? I have no clue. Can it work? Absolutely. Starting to free lenders from the toxic paper weighing them down could start the process of allowing lenders to trust each other again and stop hoarding the money they are borrowing from the Fed. They are fearful. Doing nothing invites panic. Buying up the toxic paper takes the fear factor down.
It CAN work, I just don’t know if it WILL work. I just don’t know...
My example of a depression is extreme and is not the most likely scenario IMHO. But it is definitely a possibility if we demand a systemic crash by doing nothing.
Even Nouriel Roubini, who is always negative, thinks the bailout will have a positive effect on the US financial system and will avert a deep wide depression like Japans 10 years of deflationary stagnation, and will reduce the pain to an 18-month recession.
http://money.cnn.com/2008/09/24/news/economy/Roubini_on_bailout/index.htm
If a brilliant perma-bear like Roubini thinks a well-targeted plan will limit the economic damage to a short recession of 18 months, then I defer to his knowledge and analysis. So yes, this could work.
My example of “depression” is a worst case scenario that is unlikely but still possible, hence my reason for using it. I am trying to underscore the real though outside possibility if Conservative people continue to try to correct the extreme socialism in our society at this time with this issue.
How about we live to fight another day and then we string the bastards up by the short hairs? Won’t there be enough outrage at this entire episode for voters to get motivated to both throw all the bums out on their arses and to demand Wall Street cleans up its act? Why do we have to do all that now when the financial system is balancing delicately on the edge of systemic meltdown? I don’t get it.
I hate socialism as most do here. I hate it when we don’t punish lack of personal responsibility. I want the evildoers to pay for their sins. But I don’t want my family to pay for the evildoers sins by my relatives losing jobs and having their children suffer and pay the price for it.
Lets fix the financial system first, and then we can start the armed rebellion. But here is the problem... The American electorate is so collectively stupid, there is a good chance that after the problem is fixed, they’ll go back to their American Idol and reality TV.
What time the big game start? We gotnuff beers? Did Britney’s sister have her kid yet?
Homeowners will still lose their homes with this bailout.
Inflation will be rampant.
And fuel prices will once again skyrocket.
Of course the derivatives and the credit default swaps are still to come.
But go ahead argue for the crooks and buy into the vague threats and the state of fear... And here I thought that it was the liberals that were a bunch of sheep.
You really need to use the word “BOOGIEMAN” more in your posts if you’re trying to instill fear in people.
It should not be that bad. I’m trying to make a point. But it could be that bad. That is why I’m trying to make the point. I don’t even want to risk it being that bad. I think we are in for a long deep recession, maybe 5 years. Nothing catastrophic but a lot of pain for those who can’t get jobs and not much fun and no raises for those who have jobs. The stock market will level off and retirees counting on asset appreciation will have none and see their retirement savings dwindle.
I don’t expect a depression, but lets not kid ourselves that it isn’t possible today, just because we are such technologically advanced people. Bunk. It CAN happen today and it can happen in the blink of an eye. Lets not give it a chance. Lets fight this thing first, and then we can go postal on socialsts and socialism.
If things do get bad, very bad, depression bad, and Obama is president, this idiot electorate is going to give him ALL of the Socialist power FDR could ever have dreamed of. I don’t want to give a President Obama that chance. If Freepers successfully persuade Republicans to oppose this bailout and the economy tanks, as it will, then Obama will become president and he will be the most socialist president we have ever had and will be given emergency powers by the Democrat House and Senate.
Just how in hell is that better than holding our noses and accepting an unpalatable $700 billion monetization of private debt? I can’t see it. We are tossing the baby out with the bath water.
Alex Jones is on C2C currently.
I don’t know nor understand much about the high finances . . . but it sounds like lower reaches of hell evil by TPTB . . .
A clever expert of some such just called . . . Alex recognized his voice . . . searched the annual reports of the FED and Chase, Citi Group and Bank of America
$300 TRILLION with a T in derivatives, if I heard right.
Whatever that’s all about—$300 TRILLION!!! Pretty soon they’ll be talking about some real money! Sheesh . . . what would that equal for every family in America . . .
Anyway—somehow one of them was relating that to gobbling up all the smaller banks.
Alex mentioned it is a military operation long planned . . . I agree with him.
100% of the credible Christian prophet sources I’ve read on the topic absolutely insist that while there may be a temporary reprieve . . . after that, the crash will be far worse than the 1920’s/30’s DEPRESSION. Far, far far WORSE . . . and will NOT get better until AFTER ARMAGEDDON.
I believe them.
God will take care of His own . . . as long as He leaves them here . . . and the meek will inherit the earth . . . evidently some meek will be left. Some mysteries there.
But folks need to realize that walking close with God is not whistling Dixie in denial and continuing to do one’s own thing while giving God lip-service.
Your guess was close but only off by 179-degrees.
I am all cash and have been all cash since December of 2006, as you SHOULD know by now because I have been screaming here on Free Republic on a regular basis for everyone else to get out of the market and flee to safety in all cash. All that ever got me was accusation of being a tool of the evil MSM trying to talk down the economy to get Hitlery elected, and an avalanche of people “refusing to participate in a recession” ala multi-millionaire Rush Limbaugh. Multi-millionaire actually have the luxury of “refusing to participate in a recession,” unlike us working stiffs.
I am all cash and 100% debt free. I don’t own a house because I refused to buy in the insane housing bubble.
So your guess could not have been more wrong. As for worrying about inflation, you better start worrying about deflation in a major way. All you can see is the severe short term inflation we had in food and fuel during the commodity bubble caused by the collapse of housing nad by Bernanke dropping the Fed Funds rate to 2%.
If you get your way with no bailout, when the resulting crash occurs, at worst you get laid off or at best you get a pay cut. Both disinflationary, not inflationary. If you are a retiree betting on your stock market gains, you will find them to be deflating as well.
If this works, then the monetization WILL cause inflation. So pick your poison. Some inflation or a long, deep, deflationary recession. I hate inflation but I’ll take it any day over the alternative.
As for all the heat I’ll take in this thread, I’m used to it.
When I said NASDAQ was funny money, I got pounded on here by people who said “new economy”.
When I said there was a housing bubble, I got pounded on here by people who said housing won’t go down.
When I said oil was a bubble, I got pounded on here by people who said we would never see cheap oil again in our lifetimes and oil would got to $200.
I said Bernanke’s 2% rate cut would do nothing to stimulate economic growth, since the banks refused to lend the money out anyway. I got body slammed for that call as people said, “best time to buy ever!”
Last year I said housing wouldn’t bottom until 2009 or 2010 and that last year was a terrible time to buy a house and 2008 would be much better than 2007. The hordes chimed in to say they were buying and “BEST TIME TO BUY... EVER!”
I got a stream of people jumping down my throat when I said, months ago, we were in the worst financial crisis since the Great Depression. Funny, I don’t hear that talk anymore...
By my record I am 6 for 6. Yet every time I post something, I invite the masses who probably haven’t read a small fraction of what I’ve read, jumping down my throat. That doesn’t mean intelligent people can’t disagree. There are several bright people here who fell the government can’t muster enough money to prevent systemic financial collapse and they back their arguments with facts and logic. There view is as good as mine. Nobody knows if the bailout will work.
But I take exception with this knee-jerk Conservatism in opposition of an action that just might prevent financial collapse. Without doubt, a financial collapse is a foregone conclusion if we keep going the way we are going, soaring national debt, trade deficits, corporate debt, private debt. If we avoid financial collapse, as soon as the fragile economy is strong, we have to bite the bullet and start saving, investing, and producing again — without undue debt.
That said, now is not the time to take some rigid ideological stand unless you want to destroy the village to save the village.
The crash is deliberate.
The crash has been long planned.
The suffering is desired on the part of TPTB.
The evil b*stErds WANT death, chaos and destruction.
They think they have insured their elitist safety a dozen different ways and that they will end up riding a much more manageable bunch of chipped subservient slaves ‘stewarding’ a much more eco-safe and eco-friendly planet that will survive vs one that will self-destruct . . .
They have been seduced by satan; lied to by the fallen angels and convinced that they are tasked with reducing the population to 200 million globally . . . eventually erasing most of the signs of man on the North American Continent . . . leaving the bulk of it as their vast National Park Playground . . .
Many Christians are praying that all the evil that’s hidden be exposed. God has evidently told some folks that HE IS GOING TO EXPOSE such evils soonish.
Alex talking about BILLIONAIRES in Austin TX leaving the country . . . people that OWN DEFENSE companies freaked out and leaving the country.
1/10th of 1% who are the top elites ruling things to destruction.
Deep Denial has become a
way of life for massive percentages of the populace.
>> like Japans 10 years of deflationary stagnation
I’m glad you brought that up.
That IMO was *worse* than we’ll have if we just let the chips fall here, and let the market punish the greedy and stupid as they deserve to be punished.
Nevertheless — I don’t recall any big hyperbolic “Toll Of Human Suffering” in Japan.
By the way — during that period of time I was on the executive staff of a company that had a subsidiary in Japan. I traveled to Japan many times during that period. It was a sobering time coming on the heels of the Japanese “party experience”. But all the dire things you predict DID NOT come to pass.
And, guess what? They have come out of it, arguably stronger.
One more comment: Million-five cardboard Wal-Mart McMansion “housing” in places like Stockton and Las Vegas and San Diego is no more “worth” the prices it attained during the drunken party than dot-com “companies” with no “products” were worth their share price in 1999.
The success of this whole bailout boondoggle is predicated on somehow “saving” the inflated housing market — i.e. keeping those prices at their stupidly inflated values.
Housing price does NOT equal housing value. The market determines value. The market says housing needs to deflate, and the market is right.
If one bought stupid or used one’s house as an ATM machine, then they screwed up! Let the chips fall.
In your opinion then, Paulson and Bernanke are doing the exact wrong thing. Bernanke was chosen specifically because the knew a financial crash was on the horizon.
So, knowing that in your opinion they are implementing the exact wrong steps, are Paulson and Bernane
A) Morons and idiots?
B) Corrupt stooges for the power elite to tranfer wealth to them from the middle class?
C)Part of a plan to implement the new world order?
Which is it?
Correct me if I’m wrong, but I read your post to say, “we need a financial collapse now because that fixes the systemic problems in the financial system and delaying will only make things worse.”
Do I interpret your post correctly, if simply?
Good example of a severe liquidity problem.
So what do you think fixes this problem without a flood of money?
Lost in all this discussion is that US lenders have taken MASSIVE write-downs in very short order in 2008. Frankly, I think that is very healthy for the financial system. Japan did everything they could to delay those losses. The US financial institutions have been very aggressive in taking write-downs of late and while there is much left opaque, I think this debt destruction is moving us along very well. Now we just have to prevent catastrophic deflationary collapse of the financial system so we can keep these massive write-downs coming and push through this crisis in a reasonable timeframe. Japan refused to do that and you know what that lead to.
You have my respect and appreciation for your coursage
for being awake
for being a watchman doing his job
for telling the truth as you perceive it and have researched it
May you walk close to God and be a treasure to all those you love.
The fact that sooooo many Conservative Christians who OUGHT to know far more far better are still so clueless is a mind boggling thing to me. Given that so many of our brothers and sisters are so clueless . . . imagine what the average non-conservative non-Christian is . . .
What is beyond clueless?—amoebic?
Imagine the behavior of those millions of clueless . . . some will be loyal slaves and serfs mindlessly puppeting whatever the elites tell them.
Some will become violent anarchists destroying all within reach in suicidal rages.
What will Conservative Christians do as the light begins to dawn on their willful blindness? . . . beside regret being so slow to wake up . . . Prayer and fasting is certainly in order.
Preparing as best one can is highly in order.
Hiding Scripture in our hearts and minds . . . Living God’s priorities of Loving Him above all else and others as ourselves is a super priority. Learning to hear and obey His Voice is a high priority.
I realize you didn’t ask me but I’ll chime in anyway.
Scratch (C). I don’t believe in that new world order nonsense. Even if I did, it’s not happening. With few exceptions the bozos in this administration — including Paulson and Bernanke — could (if you’ll pardon my crudeness) eff up a wet dream. They simply don’t have the competence to pull off a conspiracy!
That leaves B) malevolance and A) stupidity.
I admit I’m not for sure on this choice. How do you explain a Bernanke and a Paulson that mere weeks ago were reassuring us that all was A-OK? Were they intentionally lying to us, or, despite what they’d have us believe are they not up to the job?
I’m going to have to go with A) Morons and idiots.
My reasoning is simply the old cliche:
“Never attribute to malice that which can be adequately explained by stupidity.”
I expect they are not in denial but are completely misinformed, like the mother who thinks she can hold her baby in her arms in a car crash. She just doesn’t realize that it is like trying to catch a bowling ball dropped from a 10 story window.
I don’t think enough people here know enough about the details of this crisis to be in denial. I think they are uneducated and misinformed. Further, I don’t think most of these people bother to read the more detailed posts about the liquidity crisis. All in all, I think 90% of freepers don’t know more than what they hear from Rush Limbaugh, Sean Hannity and Bill O’Reilly and then just regurgitate their views on this forum.
I heard Rush say the most idiotic thing today. He said, “the Democrats tried to pin all this on Phil Gramm, but people aren’t buying it”. Rushes point being, this is solely a Democrat crisis. And this after Rush said he was going to “quit carrying the water for the Republicans.”
Gramm and the Republicans are very bit as complicit in causing this financial crisis as are the Democrats. They both embraced the bubbles that kept their constituents happy and they both — with a few exceptions like Ron Paul — turned a blind eye to the rapidly escalating problems, thinking they could hide them forever, or at least until retirement.
An this is how Rush Limbaugh has quit “carrying the water for Republicans?” Call as spade a spade. They are almost all of them guilty in causing this financial crisis. Almost all of them — R and D alike. Almost all of them.
So Rush spouts off and you hear it regurgitated mindlessly here. Do people even bother to read the articles posted here? Retorically asked, I will answer, seldom and rarely.
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