The Housing Bubble

Because it’s GOOD to be the Banksta!

Because somewhere along the path

“Truth, Justice, and the American way”

has by some dark magick been changed to

Deception and Injustice is the amerikan way.

At some point the darkside became the rule rather than the exception. It is now acceptable to break the law. In fact you will be rewarded, bailed out, supported if you do. Whereas, those who choose to be honest and fair are penalized. The Looters are running the show mate.

Witness the hullaballoo regarding the Arizona Illegal Immigrant issue. I heard today that the Mayor of Los Angeles is calling for a boycott of everything AZ. It is my opinion that any government representative or organization that sides with anyone who has clearly broken the law has impeached the organization’s authority to govern. I will probably get flamed on this because it is a hot button issue, but the bottom line is a law was broken. That is why they call it “illegal immigration”.

Yep, rule of law is a must. If you don’t want to enforce the border, fine. Pass a law allowing free access and there will be nothing that can be done about it. Both libs and cons are guilty of tip toeing around the real issues here.

Why do I get the feeling that people today would gladly accept all the rampant fraud it would take to get back to the bubble lifestyle instead of justice and truth?

If there were no consequence to it, I’m sure most people would love to have it back.

The problem is though, that there is a consequence to it.

This bubble/bust/bailout scheme (not the first time it’s happened) just keeps adding to the debt. An analogy is like an engine running low on oil. It starts slowing down, but the driver gives it a burst of gas which speeds it back up again. He gets a burst of speed. But the car keeps slowing down. And he keeps giving it more gas. Till the engine seizes and catches fire.

This bubble/bust/bailout economic model that’s being pushed by Wall Street does two major things: 1) It transfers a great deal of wealth from outsiders to insiders, and 2) it creates more and more national debt.

Wage stagnation, jobless recoveries - these are symptoms. Eventually, I suspect the system will seize up* if we continue like this.

* When I say seize up, I mean deliver a standard of living unacceptable to most voters.

I think you hit the nail on the head.

In chemistry terms - the problem is that many people just acted like a gas when times were good - their living style expanded to meet the level of their paycheck (the container) during the boom; but they’re acting like a liquid on the backside, and not willing to let the container shrink again.

Sometime you’ve just got to take the hit. Take the lower-paying job. Move into a smaller apartment or sell your now-too-expensive-to-maintain house. Stop eating out so much. Get by on your existing clothes for a while instead of buying new ones. Etc.

I did it. I got laid off in late mid 2008, and got a job for 25% less pay a few months later. I didn’t have to sell my house since we had a good pad saved up, and weren’t over-extended. Problem is this isn’t true for many people, and now they’re not willing to face the consequences of their pre-crash imprudence.

Guess that probably sounded pretentious. Just trying to lead by example though.

“many people just acted like a gas when times were good ”

Wondered why there was a strong fart-smell during the housing bubble. Kind of would explain why realtors use too much perfume/cologne.

11% pay hit here, Packman. No big change since my wife also works and we lived below our means before, just slightly less into savings per month and a little less eating out.

Sadly, in New Future of Glorious Green Shoots Recovery, massive decreases in pay will be the norm, while prices for many things (housing included) are still “sticky” or rising (gas prices.) I’m sure this will work out okay long-term… not!

It is confusing though why the handouts to bankers continue while unemployment benefits must end… it’s almost as if the politicians only care about who gives them the biggest bribe…

It is confusing though why the handouts to bankers continue while unemployment benefits must end…

While I don’t agree with TARP and whatnot, it’s worthwhile to note that it was a loan, rather than a handout. The money given to bankers will (supposedly) be repaid. UI benefits are strictly a handout.

If the gov was giving low-interest loans to individuals, that’d be more comparable…

How are we supposed to have a Recovery(TM) without free government money for doing nothing? Come on people, lets make this recovery happen.

While I don’t agree with TARP and whatnot, it’s worthwhile to note that it was a loan, rather than a handout.

Only one part was a “loan”.

The other part was GSE’s buying the banks bad assets with taxpayer money.

Another part was the FED creating 1.25 Trillion dollars to buy more of the bank’s bad assets.

This was the bailout the super rich to be paid back later American’s and their unborn children.

Has anyone looked at the price of shelter in Bothell, or anywhere in the greater Seattle area? $407 per week isn’t going to cut it there unless one has roommates- doubtful for a mother of a child. I’m guessing she has reserves she’s been tapping into.

Has anyone looked at the price of shelter in Bothell

She’s in Bellevue, no? Certainly there are cheaper places in the area - Bothell being one of them.

“She’s in Bellevue, no? Certainly there are cheaper places in the area - Bothell being one of them.”

From the article:

..Teauna Stephney, a 39-year-old single mother from Bothell, Washington..

Sure, Bothell is cheaper than Bellevue, but Bothell is not cheap, and certainly not affordable on $400 per week unless you’re talking a trailer park or something.

UI benefits are strictly a handout.

They’re a form of insurance, no? Employers pay into an insurance fund that pays out to unemployed workers when they get canned. I don’t see how that counts as a handout.

From the article:

..Teauna Stephney, a 39-year-old single mother from Bothell, Washington..

My bad…I mis-read. Certainly better than Bellevue.

I don’t see how that counts as a handout.

To some degree the funds are paid by the employer. However, with all the extensions, the money is coming from the federal government, not one’s former employer.

My understanding is the money from the Federal government is a loan to the state that must be paid back, not a handout. I must admit I have no idea how the states will pay it back, but that’s the theory at least.

I did a quick look at Craigslist - $675 seems to be about bottom end for a 1 BR apartment in Bothell. And who is going to rent to someone with no job?

When I was unemployed in 2003, around 50K per year previous salary would get you the max of $496 per week unemployment. So she was probably making less than that before she lost her job. If she had to cover daycare and depending on the age of her child, she may not have had much left over to put into a rainy day fund. And it does not say how long she was previously employed at that salary, so we have no idea how long she would have been able to save.

Then consider that she has been unemployed for close to 99 weeks - almost 2 years. By this time her car may be in dire need of repair and she has probably tapped most of any savings she was able to accumulate.

To earn as much as her unemployment has been, she has to find a job that pays at least 13.50 per hour - about twice minimum wage. If she works 80 hours per week at a 2 minimum wage jobs, then she has to pay for double the daycare, unless her child is old enough to stay home alone (also not a good choice). So 2 minimum wage jobs is not really the equivalent of 1 full time job that pays twice as much.

So by now, she is desperately searching for any job and competing against more recently laid off people and recent or soon to be graduates. She may figure that she can pick up that job at McDonalds the day her UI runs out. And why should she take it sooner if it will put her in a hole faster when she still has hope of getting that $15/hr job before it does?

And where is daddy in all of this? Is he unemployed, too?

She is in a tough spot and I expect she is doing the math every day. It sure is easy to say take any job and move, but the execution can still be problematic.

Good post, Happy2B.

Thank you for the research. I can’t access those sites from here. And shouldn’t the reporter be doing this instead of you?

Her job consisted of producing a weekly status report and setting up a weekly meeting for the team. For this she made $120K a year.

Do you really know that? Or are you just an engineer who thinks that marketing folks are all BS’ers who do nothing of value? (BTW, I am an engineer).

Most marketing people I know do a lot more than “produce a weekly status report”.

If her UI is $407/week, that would imply that here earnings were around $814/week, or $42K/year. Washington State UI tops out at $625/week and pays roughly 50% of the beneficiarys wage but is limited to the $625/week.

I’m not making excuses for her, but if her earnings were $42K she’s not going to be able to put much aside living in Bellevue.

she’s not going to be able to put much aside living in Bellevue.

Perhaps she should choose someplace cheaper nearby to live, like Issaquah

Or Ellensburg. The cost of living in King or Shohomish County is high, no matter where you live. I read in Forbes as I recall Seattle is the worst or next to worst affordable city in the US, when comparing living costs to median wage.

Good grief, what about Oly’s old stomping ground in Thurston County? I got the impression that the Oly family wasn’t forking out big bucks to live there.

“Do you really know that? Or are you just an engineer who thinks that marketing folks are all BS’ers who do nothing of value? (BTW, I am an engineer).”

No, I am not an engineer. But I know a BS job when I see one.

“Perhaps she should choose someplace cheaper nearby to live, like Issaquah”

Uh, methinks you don’t know Issaquah.

You are quick to pass judgement on someone you do not even know. Oh well.

“Or Ellensburg. The cost of living in King or Shohomish County is high, no matter where you live. I read in Forbes as I recall Seattle is the worst or next to worst affordable city in the US, when comparing living costs to median wage.”

Sure, one can move to Ellensburg to live off the unemployment check, but there is next to no chance to land a job, much less a decent paying on in that dinky farm town. I agree, though, it’d be hard to find a place more difficult to make ends meet on median income than the greater Seattle area. There are affordable places around Tacoma, but the crime is unholy.

Naw, you commute into Seattle. Its just a couple of hours each way, unless it snows on the pass.

BMW is going to locate a composites plant in Moses Lake of all places. Moses Lake makes Ellensburg look positively cosmopolitan.

“Naw, you commute into Seattle. Its just a couple of hours each way, unless it snows on the pass.”

I know you’re kidding. Ellensburg is not commutable to Seattle. Fuel, maintenance, and repair would eliminate any savings on rent.

“Good grief, what about Oly’s old stomping ground in Thurston County? I got the impression that the Oly family wasn’t forking out big bucks to live there.”

I actually know exactly where Oly lived, the house and everything. She lived right on the Puget Sound, in quite an expensive area.

Based on Ki’s research, she has been a temp worker. She probably had some money saved. She may have had stretches of unemployment before that tapped some of her savings.

After almost 2 years with no work and on unemployment, how much would you expect her to have left?

My hubby talks about the young lowlifes at work and it cracks me up. Besides all the mistakes they make on the job… never enough money..Health problems but they “can’t afford” to get the insurance the company offers, always going out for junk food, charging up toys on the CC, DUI…out of wedlock kids here and there, sorry, got to be in court today…LOL.

I wasn’t going to bring it up but you gave me my segue. How much money does the husband of the woman in the article bring home? Oh, what’s that? The traditional family is no longer needed, oh, OK.

Exactly.

I still can’t figure what part people don’t understand that millions of jobs were lost over the last 30 years while millions of people came into the workforce.

Oh wait! American Idle is on! Ohhh. Shiny.

Despite repeated examples in history these slobs require a head bashing and Oh Sht moment (I might loose my wealth too) before they comprehend the situation. By the time there is a critical mass it may be too late.

This is the main reason that the establishment grabbed hold of the Tea Party so quickly. Now the TP doesn’t even know what it’s so mad about.

But the underlying reason they are mad is because the middle-class has been shafted and looted by the the Wall Street Bank crowd.

The Tea Party almost figured this out at first but their anger was re-directed towards the bogus cited 47% who pay no taxes (but who actually pay as much total taxes as everybody) and the “socialists” who wanted to take over their Medicare. Classic shell game.

The key to appealing to the Tea Party mind is through patriotism. This is how the failed, hypocritical, Randian bedwetters co-opted the movement by labeling the poor as leaches and non-producers when in fact it is the Tea Party’s string pullers (the super-rich, Banks, etc.) who have been the biggest leaches sucking the life out of America. The Bank leaches have created poor leaches (by debt and outsourcing) who they now point the finger towards as the cause of the middle class’s problems. It’s sort of working. So far.

The real danger to the PTB will come when the Tea Party is convinced of the real root of the problem. This would not be as hard as it sounds as Americans like capitalism but don’t like to be ripped off. (I’m like that)

When the TP comes to realize WHY their way of life has been gutted and WHO PROFITED FROM THE MIDDLE-CLASS’s GUTTING, we’ll then we have a new ballgame in American politics.

And when the 18% Tea Party joins the 20% who already knows what’s going on…

Well, there’s your critical mass.

Rio - I mainly agree with your post, except for one thing.

The key to appealing to the Tea Party mind is through patriotism. This is how the failed, hypocritical, Randian bedwetters co-opted the movement by labeling the poor as leaches and non-producers when in fact it is the Tea Party’s string pullers (the super-rich, Banks, etc.) who have been the biggest leaches sucking the life out of America.

Oops - ignore that post - I clicked the wrong button. Here’s what I meant to post:

Rio - I mainly agree with your post, except for one thing.

The key to appealing to the Tea Party mind is through patriotism. This is how the failed, hypocritical, Randian bedwetters co-opted the movement by labeling the poor as leaches and non-producers when in fact it is the Tea Party’s string pullers (the super-rich, Banks, etc.) who have been the biggest leaches sucking the life out of America.

This to me indicates that you’ve never read Rand. Ayn Rand is much closer to the genesis-form of the Tea Party than the co-opted form - by far. She would have laughed and ridiculed your association of her ideas with any kind of patriotism - in fact they were the opposite. Rand was pretty much an atheist, both in religion and in geo-political loyalty.

Packman, Is this explanation a little more convincing? Link to follow:

Taibbi: The Lunatics Who Made a Religion Out of Greed and Wrecked the Economy, Alternet: April 26, 2010 | By Matt Taibbi

When Britain and other countries were engulfed in the flood of defaults and derivative losses that emerged from the collapse of the American housing bubble two years ago, few people understood that the crash had its roots in the lunatic greed-centered objectivist religion, fostered back in the 50s and 60s by ponderous emigre novelist Ayn Rand.

The rightwing “Tea Party” movement is just one example of an entire demographic that has been inspired to mass protest by Rand without even knowing it.

On the other side of the debate were the people who argued Goldman wasn’t guilty of anything except being “too smart” and really, really good at making money. This side of the argument was based almost entirely on the Randian belief system, under which the leaders of Goldman Sachs appear not as the cheap swindlers they look like to me, but idealized heroes, the saviors of society.

Rand’s fingerprints are all over the recent Goldman story.

Ayn Rand is much closer to the genesis-form of the Tea Party than the co-opted form

I agree. But I think the coopters used patriotism and the appeal to the flag, freedom etc. to promote the leach/producer Randian ideas. It’s not hard to portray “leaches” as idealistically anti-American and anti-capitalism.

They used patriotism and Randian ideas together as tools whether or not those tools were meant to be used together.

Kind of like USA and USSR teaming up once.

I’m posting a new Matt Tabbie article about it. Let me know what you think of it please.

Rio….Your so right . It’s going to take time for the public to know who is fleecing them . The PR machine is powerful .

The fundamental problem here is that people equate/associate what Goldman Sachs (and others) did as free market capitalism, and therefore also equate it with Randian ideas. That’s the core of the problem though - what they did wasn’t free market capitalism, because they used the government as a tool to influence policy in their favor. This is in fact the opposite of Randian ideas.

Read Atlas Shrugged. It’s practically a roadmap for what’s happened here. The antogonists in the story are indeed the companies that use the government as a tool for increasing their own power, by implementing policies supposedly in the name of free and fair markets, but which in reality were very anti-competitive; that screw over the companies that are truly innovative but don’t have the same level of government influence.

And when the 18% Tea Party joins the 20% who already knows what’s going on…

Well, there’s your critical mass.

I like what you’re saying, but I don’t think it will work until the 20% stop insulting the TPers long enough for some understanding to occur. And of course there are those benefiting from the current system who will do their best to keep the fires of animosity between the two groups stoked…

they also equate de-regulation with lawlessness.

I think there is also a issue of the fraud of mis-rating the MBS
securities to begin with . Wall Street breached their duty in every way to to be a lender and not a big joke lender making bad loans betting on the come while they could leverage by 30
times while not being transparent .

Rio,

You going to post that Taibbi article? I’d like to give it a look.

However if it’s anything like Taibbi’s previous rants against the tea party, e.g.:

This whole scene sort of encapsulates what’s wrong with the Tea Party movement. The movement, and let’s admit this, has some of its roots in legitimate grievances about government waste and some not-entirely-inaccurate observations about what’s left of the American welfare state. Of course what resonates most with the suburban whites who mostly make up the Tea Party are stories about minorities and immigrants using section 8 housing, food stamps, Medicaid, TANF and other programs, with the Obama stimulus being for them a symbol of this ongoing government largess. The heat of the Tea Party movement comes from the racial frustrations that actually exist out there, in the real world outside New York and LA, as urban expansion and immigration increasingly throw white and nonwhite communities together, with white Tea Party types more and more often blowing gaskets over increased crime rates, declining school standards, and mislaid or wasted tax revenue.

Then no thanks. He lost legitimacy on his views of the tea party when he pulled out the racist card.

Perhaps there is a racist person or two involved, but that’s kind of hard to avoid when you have any organization (such it is) of such size; there are always going to be outlying kooks going along. But race isn’t even close to what the tea party is about at all - either in its early or its co-opted form.

“This is the main reason that the establishment grabbed hold of the Tea Party so quickly. Now the TP doesn’t even know what it’s so mad about. But the underlying reason they are mad is because the middle-class has been shafted and looted by the the Wall Street Bank crowd.”

I was told repeatedly the tea party is nothing but rich white guys. So rich white guys are mad at themselves? Interesting.

“the bogus cited 47% who pay no taxes (but who actually pay as much total taxes as everybody) ”

47% pay $0 income tax. That is fact. You can say it isn’t so 1000 times a day and it doesn’t change the fact it is so.

The argument you put forth - the 47% pays sales tax, gas tax, etc is ridiculous. It’s like saying 47% of the public gets free cable but they pay for phone service so it’s all good.

“The fundamental problem here is that people equate/associate what Goldman Sachs (and others) did as free market capitalism, and therefore also equate it with Randian ideas. That’s the core of the problem though - what they did wasn’t free market capitalism, because they used the government as a tool to influence policy in their favor. This is in fact the opposite of Randian ideas.”

The same can be said for Monsanto, Walmart, and most all of the mega corps which are now controlling our lives. They didn’t benefit from free market capitalism, but by an abysmal failure of a government bereft of all that is moral, and rife with a level of corruption almost unimaginable.

The fundamental problem here is that people equate/associate what Goldman Sachs (and others) did as free market capitalism, and therefore also equate it with Randian ideas. That’s the core of the problem though - what they did wasn’t free market capitalism,

Been a long time since I read that book. I remember I preferred War and Peace but I see your point and I have nothing invested in bashing Randians necessarily. It’s just a lot of people are now but I could have just has easily wrote:

This is how the failed, hypocritical, Randian fake-free-marketers, quasi-capitalist, crony-corportists bedwetters co-opted the movement by labeling the poor as leaches and non-producers when in fact it is the Tea Party’s string pullers (the super-rich, Banks, etc.) who have been the biggest leaches sucking the life out of America.

You do bring up another point though on why so many label it as Randian and a lot do. Maybe because of Greenspan actions combined with his relationship with Rand?

Here’s another quote out of that article that does it again:

People have to understand this Randian mindset is now ingrained in the American character. You have to live here to see it. There’s a hatred toward “moochers” and “parasites” – the Tea Party movement, which is mainly a bunch of pissed off suburban white people whining about minorities consuming social services, describes the battle as being between “water-carriers” and “water-drinkers”. And regulation of any kind is deeply resisted, even after a disaster as sweeping as the 2008 crash.

http://www.alternet.org/story/146611/taibbi:_the_lunatics_who_made_a_religion_out_of_greed_and_wrecked_the_economy__?page=3

47% pay $0 income tax. That is fact. You can say it isn’t so 1000 times a day and it doesn’t change the fact it is so.

Sacrifice wise, poor people support the USA more than you because they pay about the same percentage of their income in total taxes as all of us do. Actually what they pay is much more burdensome to them than what we pay. Therefore, they sacrifice more for their country paying a higher percentage of their disposable income than you and me. The poor pay gas, sin, property, sales, state, federal payroll, federal medicare and utility and service taxes. I’ll bet you didn’t know that Ki.

Your argument is like saying a renter does not have the right to live in peace in a city, or be part of that city because he pays no property taxes which is the main revenue for a city.

Unless you are in fact writing from a playbook, I’d say your politics and propaganda are continually interfering in your ability to objectively conceptualize complicated issues.

You do bring up another point though on why so many label it as Randian and a lot do. Maybe because of Greenspan actions combined with his relationship with Rand?

Yeah that’s unfortunate (and been discussed on HBB a number of times). I haven’t seen much written about any explicit repudiation of Randian ideals by Greenspan, but it seems like attempting to steer the whole of the U.S. economy via the rudder of the by-definition-collectivist Federal Reserve is very counter to the opposite individualist Rand philosophy.

It seems that point just breezes by a lot people, including many of the supposed free-marketers.

You going to post that Taibbi article? I’d like to give it a look.
However if it’s anything like Taibbi’s previous rants against the tea party, e.g.: Then no thanks. He lost legitimacy on his views of the tea party when he pulled out the racist card.

I posted that last post with the link before I just saw your last post asking for the link.

I guess he does mention the race thing but different ethnic groups are involved in a lot of stuff but it doesn’t mean everyone is a racist that talks about it. I have some leeway in what I see before I call racism. For example, I am against illegal immigration but that doesn’t mean I’m prejudiced or racist against the Mexican or Hispanic race.

Sounds like Mr. Taibbi has been reading my mail.

I agree you won’t find in one of Rand’s romance novels a hero who uses the government to garner his riches. That would be way too realistic and sissified for her Hollywood-buff, perfect-man heroes, who earn their livings smelting metals and building railways. But you will find a consistent portrayal of any and all regulation as being a means of the parasites (who are by far the majority of the population in her books) to suck their livelihoods from the heroic, flawless, and much put-upon ‘producers’ (who are a tiny minority- and no, there’s no middle ground). Because, of course, no regulations are needed for these morally perfect entrepreneurs- they’ll naturally do what’s right. Just like Greenspan (her lover, friend, and lifelong proponent) thought about successful firms never doing anything that might harm the system. Coincidence? Sure is a big one.

I too think everyone should read Atlas Shrugged. See if you don’t find it glorifying exactly the ethos that has brought us where we are today: Regulation is a way for the little pissants to keep down the ‘reality makers’. If they’d just get out of the way, these titans could get to work on our new paradigm. And the world will be such a better place.

Well, we tried it and here we are. And it’s not better, Ayn. We freed the titans and they ripped us off.

(I bet someone tells me this time didn’t count- it wasn’t a ‘perfect’ free market. Maybe in heaven we’ll finally get to test her hypothesis.)

From an abc news interview with Greenspan:

TAPPER: You’ll be testifying about the financial crisis on
Wednesday before the Financial Crisis Inquiry Commission. When you
testified before Congress in October, you said that you finally saw a
flaw in — in the way that you looked at markets, that markets cannot
necessarily be trusted to completely police themselves.

But isn’t it — isn’t it more than a flaw? Isn’t it an indictment
of Ayn Rand and the view that laissez-faire capitalism can be expected
to function properly, that markets can be trusted to police themselves?

GREENSPAN: Not at all. I think that there is no alternative, if
you want to have economic growth and higher standards of living, in a
democratic society, to have competitive markets. And, indeed, if you
merely look at the history since the Enlightenment of the 18th century,
when all of those ideas surfaced and became applicable in public policy,
we’ve had an explosion of economic growth…

Note the use of the straw man: Rand is equated with competitive markets (as if zero regulation- which she specifically calls for, would ever produce that), democratic societies, and the Enlightenment. Criticism of her is portrayed as criticism of these things.

Well I’ll gladly bash Randians and Lindertarians!

Because they ARE stupid and should be told so REPEATEDLY that they are. Naive and stupid and sheltered.

Rand is equated with competitive markets (as if zero regulation- which she specifically calls for, would ever produce that), democratic societies, and the Enlightenment. Criticism of her is portrayed as criticism of these things.

Is this the crux of the Randian philosophy?

1. That zero regulation would produce more competitive markets?

a. If so how would markets with zero regulation self-prohibit monopolies or fraud?

b. If so how can the consolidation of wealth and banking power, the need for bailouts and the current mess be blamed on over-regulation?

Because they ARE stupid and should be told so REPEATEDLY that they are. Naive and stupid and sheltered.

Why?

The fundamental problem here is that people equate/associate what Goldman Sachs (and others) did as free market capitalism, and therefore also equate it with Randian ideas. That’s the core of the problem though - what they did wasn’t free market capitalism, because they used the government as a tool to influence policy in their favor. This is in fact the opposite of Randian ideas.

Packman, I’ve been thinking and reading. Maybe it was Randian to start with but evolved from Randian because Randian doesn’t work in actual practice because of human behavior’s reaction to money. Let’s face it. Very few businessmen want competition and all businesses trend towards monopolies or crony cartel type thing if not regulated. Why would they not?

For example: It was the Randian thinking that deregulated the banking industry and repealed Glass-Steagall. This was de-regulation IMO. And the wild-west, no rule ethos caused the crises. When the crises happened the Randians immediately begged the government to bail them out which meant they were hypocrites and Randian wannbe’s who couldn’t walk the walk?

It seems to me, the Randians had their shot in Banking/Finance , or much more of a shot than in the past and it didn’t work. Thus the bailouts.

Am I missing something?

Am I missing something?

By jove, I think you’ve got it.

It seems to me that the problem we face is much less due to deregulation and much more due to regulatory capture. If one looks at it that way then the Randian motive and effect holds up quite well.

It’s both.

Deregulation was THE watchword of the Reagan era and continued right up the Chimp admin. What was left after each step was co-opted.

Am I missing something?

Yes. The simple fact that bailouts exist at all is the antithesis of Randian free-market philosophy. They are the ultimate in regulation. And they happened without a reinstatement of Glass-Steagall.

Not to mention the VAST array of other regulations which many folks continually ignore.

I won’t take the other ignorant “libertarians are stupid - nanny-nanny-boo-boo” bait.

It seems to me that the problem we face is much less due to deregulation and much more due to regulatory capture.

I see that point but to me, regulatory capture can have the same result as deregulation in this way:

If a regulatory agency becomes “captured” and changes regulations to favor the firms that “captured” it, then this has the same result as eliminating regulations that, in the past, prohibited that same favor towards the capturing entities.

Therefore the final effect of the regulatory capture was the same as deregulation. Therefore the Randian motive was discredited by the backdoor but discredited nonetheless.

The simple fact that bailouts exist
Not to mention the VAST array of other regulations

Bingo! The Keynesians in this blog would never admit to those. They will just parrot “no regulation” and “free market did this” BS over and over again. Obviously they have no idea how regulated these banks and markets are. That would be asking too much from the true believers…….

Not saying the banks aren’t at faults. The perfect punishment for them would have been to NO BAILOUTS resulting in collapse of their companies. Instead our Govt chose something else.

Once again I see Govt more at fault with it’s bailouts than the banksters with their greeds.

Laissez-faire economics will produce a free market for about as long as anarchy will produce a free society- ie about as long as it takes for the first gangs (street or economic) to form. Maybe…ten minutes?

Don’t forget that the Randians also favor zero environmental regulation. Somehow that’s self-regulating too. I guess once you pollute too much, people die and pollution decreases.

Randians also favor zero environmental regulation.

Absolutely! Go to youtube and search for George Carlin’s environmental rants. Mother nature will take care of everything. Works for me!

Proper regulation prevents the need for bailouts. We had *no* bailouts of the post-Depression Keynesian financial system. We elected a bunch of Randian (Reagan) deregulators, and it’s been one bank (or S&L) bailout after another ever since. Along with a massive run-up in national (and personal) debt. Once again, mighty big coincidences.

Not saying the banks aren’t at faults. The perfect punishment for them would have been to NO BAILOUTS resulting in collapse of their companies. Instead our Govt chose something else.

Governments chose or had to chose bailouts? Regardless, bailouts happened.

IMO the biggest failure of communism and pure-greed capitalism is that neither took into proper account human behavior and enough political and social considerations.

You can’t depend on economic systems based on pure math or economics that don’t give credence to the importance of social science. Otherwise they fail. Human behavior has been overlooked in favor of feel good, noble man theories maybe.

It seems bailouts happen in endangered, large capitalistic economies. So how can one ever realistically envision an economic system that precludes them? If the most “capitalistic” system on earth (Wall Street) just begged for bailouts, then is there any real hope that bailouts won’t be used?

Therefore is the raw “free-market” solution credible in practice? Or is it just another enticing novelist’s fiction?

The above posts have explained why, RioAmericanInBrasil, Randians and libertarians deserve nothing but scorn and derision.

The naive, simplemindness of both are literally, juvenile and bankrupt.

“a min wage job doesn’t even pay for the gas ”

Live by hyperbole, die by hyperbole.

Well, if gas was ALL you had to pay for with your min wage, then yeah, I guess it was hyperbole.

So there are no pedestrians? I fine that hard to believe.

How come you’re so sensible about economics and so nutso about health care?

How come you’re so sensible about economics and so nutso about health care?

If that’s not the most diplomatic way to start a conversation, I don’t know what is

“If that’s not the most diplomatic way to start a conversation, I don’t know what is…”

For good measure, he could have thrown in some vicious affronts about s3x and religion along with the political poke in the eye.

Comment by LehighValleyGuy
2010-04-29 06:51:55
How come you’re so sensible about economics and so nutso about health care?

Well, thanks for the half-compliment.

It’s my personal opinion that in order to have an optimally functioning economy and society, basic needs must be met. I’m one of the wackos who believes that healthcare is a right that supercedes another person’s “right” to make a profit at the expense of someone else’s health.

IMHO, I’m a socialist where basic needs are concerned and believe that certain things like food/agriculture, water, air/pollution, medicine, etc. should be owned or highly regulated by the government (that is held accountable by “We the People”). I believe that anything that can easily be monopolized (like energy/transportation/communications infrastructure, etc.) needs to be controlled by the govt.

Anything that is a “want” or something where the infrastructure that supports a certain market cannot be easily monopolized should be fully “free-market.”

It didn’t seem to teach good lessons in 1930s Europe.

But it sure offers lessons for those who care to study 1930s Europe.

Those who don’t learn from history… etc.

The 1930s also taught something about repudiating debt by running the printing press. I guess it wouldn’t be quite as alarming if the printing is all done electronically, as there will be no resulting need to cart around paper money in wheel barrows.

I think that was 1920s Europe.

Noting the History Channel last night reported The Boston Massacre occurred when mobs had been roaming across Boston for 2-3 days causing havoc. Their problem? They had just lost their jobs and blamed the British.

Of course, the British obviously not realizing the pent up frustration across all the citizens should have never opened fire on unarmed men. Why do I believe our leaders may be equally as tone deaf?

“The 1930s also taught something about repudiating debt by running the printing press. I guess it wouldn’t be quite as alarming if the printing is all done electronically, as there will be no resulting need to cart around paper money in wheel barrows.”

Just when is this inflation going to hit, which people here have been talking about for years? We already had inflation.

Just when is this inflation going to hit

Been to any gas stations lately?

“Been to any gas stations lately?”

So you’re basing inflation solely upon the price of fuel? While I don’t agree with a lot you say, I would have expected a more well-reasoned response.

Since we’re going to cherry pick the price of one item, I’ll go ahead and ask you:

Have you noticed the pizza price wars lately? Definitely deflationary.

I’ve noticed that a lot of food chains are offering some reduced menu items.

But my grocery store, utility bill, gas, insurance, vehicle maintenance, clothes, water, sewer, etc have all KEPT going up. And rent has dropped maybe 10% where I live. whoopee.

So fast food, much like the falling prices of PCs, are NOT necessities of life. And the necessities have NOT deflated. Not in my state at least.

Seeing the same thing here, eco. Deflation was a minor blip in the late 2007-early 2009 timeframe, but even then, commodities were going up wildly through 2008, IIRC.

I think we are seeing wage deflation and cost inflation. The worst of all worlds.

Many of my friends and acquaintences anticipate their wages to grow at the same trajectory of their parents and thus they rationalize high house prices.

They must work for the Federal Gov’t. The only people I know who seem happy and unconcerned these days are those who work for the Feds. Everyone I know in the private sector has teensy tiny expectations.

I hope you never ever have to go through any sort of long term unemployment again, as I hope I never have to as well. However, I strongly recommend public radio over TV as daytime background noise while doing job research, tailoring resumes, etc. If you don’t like the programming on your local station, there are many others available over the internet. I went though a heck of a long time at home when I never touched the TV before 6 or 7 in the evening.

“The “trees grow to the sky” crowd is getting really tiresome. Many of my friends and acquaintences anticipate their wages to grow at the same trajectory of their parents and thus they rationalize high house prices.”

Still going on in Maryland, at least in larger businesses.

Everyone assumes they’ll be a VP at some point, that huge raises each year are the norm, overpriced housing makes sense because eventually “your salary will be much higher” and so on. Right…

There are a number of people I know that recently bought much larger homes w/in the last year or are doing major upgrades on their homes that have already mentioned a strong possibility of a job loss. But they commit anyway almost like they’re on automatic pilot.

I suppose it is possible that some people could have experienced the loss of a parent and subsequent gifts of money may be behind these choices but for most of them, that is not the story.

Perhaps it is like a midlife crisis. Most of our peers are in their 40s and perhaps they feel its now or never.

Amen!

I’ve seen the same charge from several articles. As the FED chief is likely selected by the banking elite it is unlikely we will see a change of course.

Thanks.

As for it being better that she is an academic? Well, that’s your opionion and you’re welcome to it. That’s all I have to say about that.

Mainly just saying that because it seems like the corrupt uber-PTB are always from the commercial side - guys like Paulson, Rubin, Summers, Geithner, Corrigan, etc. While the academics are generally of the same Keynesian views, it seems like there are at least some (e.g. Shiller) that are not.

At least in her case if/when she exercises her Keynesian principles, it be because that’s her true beliefs, rather than it being due to funneling money to close Wall Street ties like most of the others.

Keynes would have nipped both the dotcom bubble and the housing bubble in the bud. He also would not have allowed the financial deregulation that led to the last bubble. If you think his theory involves nothing but deficit spending, you simply don’t understand his theory.

Prolly about right.
50 k rip off back surgery discectomy insurance said yes, then no
10k schooling
50k 3 misc other surgeries (fusion, rotator cuff)
20k x 10 medical insurance
12k one expensive a$$ drug to help me function insurance not cover either.
10 years on couch at 50k per year and teaching school thrown in
1 house 117k
Its all spent. At least I have a doctor now who will treat my pain, and I can get off the couch and sub teach!
Not a leach, no offense taken

Wow, good thing you had the profits you did. Thanks for sharing and clarifying, mike. Best of luck to you.

Well the jerks vs nice guys is the mirror image of the madona/whore complex. I tend to put it down at least partly to the idea that it is sometimes handy for a group to have brave/foolhardy (hunters, firefighters, etc)people around, but they tend get killed off. So the best way for a group to have genes that predispose people to those behaviors is to have the women more interested in sleeping with them. Evolutionary psychology like this is kind of fun for cocktail parties, but I’m not sure that it’s really science.

As for the original point, well in evolutionary terms we’re wired for scarcity rather than abundence, which makes sense when you’re talking about hunter/gatherers.

I’ve heard it explained as well-adjusted women not wanting jerks, but being attracted to confidence, which is interpreted as “jerks” by men who lack confidence. Then add in the non-well-adjusted women and their taste for abusers…and you end up with the common “women only like jerks” complaint.

I think there’s something to that, Carl.

“Being stable and reliable as a young man is definitely viewed as boring and weak and unattractive.”

The young ladies at the offices I visit always keep a lap dog around for security, but they’ll lift that skirt in a hot moment for strong, chiseled man; no shame either.

LOL. I enjoyed your post.

The young ladies at the offices I visit always keep a lap dog around for security, but they’ll lift that skirt in a hot moment for strong, chiseled man; no shame either.
——————-

I think these women prefer the “dark, brooding, with a hint of badness” types for the same reason(s) Tiger Woods cheated on Elin with his mistresses — who were clearly below Elin’s level.

Same goes for Jesse James’ cheating on Sandra Bullock. Again, the same scenario where he cheats (on a top-quality woman) with women who could easily be described as very bad-ass white trash.

I think both men and women have a “dark side” that is in conflict with what they perceive to be good and wholesome. I think most people can’t reconcile these two sides, so they live two different lifestyles (for as long as they can get away with it).

Women are hardwired to be attracted to “alpha” males rather than “betas.” That’s the whole idea around what’s called “game.” Girls preferring “jerks” to the nice guys. There was a reality show a couple of years ago called “the Pickup Artist” where nerds learned “game” and transformed themselves into chick magnets. For more info a guy named Roissy has a blog devoted to the subject.

http://www.zerohedge.com/article/spanish-q1-2010-unemployment-number-accidentally-leaked-surpasses-20-first-time-1997

sorry for the long link…

linky in a bit, sorry I’m clueless in creating a tinyurl…

You can’t fix stupid.

Oops. Hit submit accidentally. What I wanted to say was that this is what happens when you focus on a single bottom line rather than a triple bottom line. We are pimping off of a failed model developed in the 18th century. That’s some shameful shi…

“only thing that’s different about it’s hull is it’s got a different name painted on it”

-That, and the hull has a big patch on the bottom.

Hahaha - that same ship is still out there?!

Oh, wow… talk about a model for how we “solve” our problems: paint over the problem, rename it, and hide the truth!

Much like ACORN will turn into something else and continue the same games, politicians rotate between jobs, companies swap names and continue the same bad practices, etc.

Just slap a patch on it, rename it, and pretend nothing happened! Problem solved!

hmm…
Registered in panama.. Hong Kong Bloom Shipping Ltd owns it. It’s been renamed the “Dong Fang Ocean”..

however, i see it’s just an ore-carrier nowadays.. bummer..

It’ll be out there for centuries, according to Water World.

“maybe i only understand this planet better than you do..”

That, friendo, is highly doubtful. I have worked in the oil and mining industries, have degrees in geology and environmental, wrote my thesis about paleoclimate, researched limnology for the National Park Service, etc..

So mine actually is bigger.

It’s just that it’s always about a single bottom line with you and it’s no longer working. You’re only worrying about the almighty dollar and vehemently defending a failed system and failed modes of thought.

Nice work on googling those seepage facts, though!

“I can imagine how some form of life (maybe human) either evolved thanks in part to oil or it’s break-down products being in the water, or might even depend on some oil being in the water today..”

One of the classic forms off terrible, thoughtless argument. I can’t remember the term for it but, P.U., it stinks!

Hey maybe the Earth has evolved to break down the natural seepage and that the extra that we put in throws the whole thing out of balance. My “point” is as “valid” as yours above. Surely, you must see the holes?

All opinions are not created equal.

MrBubble

“environmental [sciences]” above

…maybe the Earth has evolved to break down the natural seepage and that the extra that we put in throws the whole thing out of balance.

Do you see ANY evidence of that? How long did you ‘experts’ predict that the Valdez spill would soil our environment.. decades.. eternity? And how long did it actually take nature to clean it all up? Was it 3 or 4 years?

Seems to me that nature has quite a bit of reserve capacity to clean up not only it’s own natural spills, but ours too.

There isn’t any evidence of my statement, duh, nor is there any truth to your opinion. I was putting my “hypothesis” up as a counter-example to yours using your same flawed technique. Get with the program.

Now, of course, the same argument cannot be used for the ability (or lack thereof) of the planet to deal with the excess CO2 that we are pumping out. So don’t get all excited. Sources are outpacing sinks, even though there is an unknown sink. [Bummer that the Japanese satellite that was supposed to study that issue crached last year]

MrBubble

PS: And “Seems to me” when talking about science or planetary system balance (or imbalance) doesn’t cut the mustard. You clearly are out of your element.

“They call oil a pollutant. Of course it is from our point of view.. but it wasn’t a pollutant before we existed.”

Nothing was called anything before we existed.

If you like the stuff so much, why not fill your pool with it… or go down to the gulf and swim in it.

It’s pollution no matter where it came from, and it’s not ok for an oil rig to explode, kill a dozen-odd people, and dump millions of gallons of toxic and valuable stuff into the ocean. It just isn’t. There is absolutely no justification.

Joey at his best today

But time may be running out: Oil from the spill had crept to within 12 miles of the coast, and it could reach shore as soon as Friday. A third leak was discovered, which government officials said is spewing five times as much oil into the water as originally estimated — about 5,000 barrels a day coming from the blown-out well 40 miles offshore.

Suttles had initially disputed the government’s estimate, and that the company was unable to handle the operation to contain it.

But early Thursday, he acknowledged on “Today” that the leak may be as bad as the government says. He said there was no way to measure the flow at the seabed and estimates have to come from how much oil makes it to the surface.

If the well cannot be closed, almost 100,000 barrels of oil, or 4.2 million gallons, could spill into the Gulf before crews can drill a relief well to alleviate the pressure. By comparison, the Exxon Valdez, the worst oil spill in U.S. history, leaked 11 million gallons into Alaska’s Prince William Sound in 1989.

As dawn broke Thursday in the oil industry hub of Venice, about 75 miles from New Orleans and not far from the mouth of the Mississippi River, crews loaded an orange oil boom aboard a supply boat at Bud’s Boat Launch. There, local officials expressed frustration with the pace of the government’s response and the communication they were getting from the Coast Guard and BP officials.

“We’re not doing everything we can do,” said Billy Nungesser, president of Plaquemines Parish, which straddles the Mississippi River at the tip of Louisiana.

“Give us the worst-case scenario. How far inland is this supposed to go?” Nungesser said. He has suggested enlisting the local fishing fleet to spread booms to halt the oil, which threatens some of the nation’s most fertile seafood grounds.

No problem here just look away. It’s natural right.

measton, i am always disappointed when very educated and intelligent people do not view mankind and it’s actions as natural, and are convinced that nothing we do can be considered natural.

Instead, we are some sort of destructive aberration and the best thing that could happen is we all get lobotomies and go back and live in the trees..
—

This earth spun for billions of years before we existed and will do so for many billions more after we’re gone.. it doesn’t need our help.
We like clean beaches and cute little animals and pure water and safe food, etc, so we clean up after ourselves.. but don’t imagine the Earth is affected by our actions one way or another.

The Earth and other species on Earth are being affected by our actions on a global scale. That is a fact and you are patently wrong. We can talk about extenction rates and CO2 concentrations and temperature, etc. specifically if you’d like, but we definitely are affecting the planet.

Will Earth keep on spinning once we are gone? Of course it will. But it will be a very different place had we not been here. To say otherwise is nowhere near right.

“we are some sort of destructive aberration and the best thing that could happen is we all get lobotomies and go back and live in the trees..”

Another terrible logical fallacy. I can’t remember its name, but suffice it to say that your reasoning skills are sub-par. I may go look up those fallacies so that I can call them out as we daily listen to you bumble through your mind — lobotomized or otherwise.

MrBubble

We can talk about extenction (sp) rates..

OK..
Something like 95% of all species that ever lived on Earth are now extinct. Probably 94.9999% of those disappeared before man even existed.

Species extinction would seem to be a perfectly natural thing.

Suppose some animal other than man causes the extinction of some species. Is that considered natural?

We like clean beaches and cute little animals and pure water and safe food, etc, so we clean up after ourselves.. but don’t imagine the Earth is affected by our actions one way or another.

I certainly don’t want to live in a third-world hellhole with choking air pollution, parasite-infested water, sewage in the streets, and industrial run-off everywhere. One Love Canal is enough. Our environment is clearly impacted by our actions.

I don’t know about long-term models and whatnot, but doing a little here and a little there adds up, if we do it consistently.

It’s not easy to have your cake and eat it too. Sometimes it’s impossible.
I look around this room and, except for a potted plant, everything is manufactured, including the pot the plant is in.

All that manufactured stuff doesn’t grow on trees. It comes only at the end of some long, filthy process. We are still learning how to avoid making a mess, and some messes are unavoidable, and we’ve long way to go before perfection… but we are not giving up our stuff in the meantime.

——-
Love Canal
In 1942, Hooker Chemical and Plastics began disposing chemical waste in the Love Canal region. Other companies as well as the military had used it as a chemical disposal site since the 1920s. (!!)

And then a public school board FORCES Hooker by threat of imminent domain to sell the freakin abandoned dump site to them so they can build.. guess what.. a freakin SCHOOL.. on top of a freakin 50 year old toxic dump..

We still got a lot to learn today.. maybe we haven’t even scratched the surface yet.. but we are not perfect and shouldn’t imagine that everything we do that turns out wrong was a stupid mistake. A mistake yes, but mistakes are unavoidable.

Finding scapegoats and misdirecting our rage is avoidable. We like buying and using all the plastic, chemical and metal stuff? Then we like oil and have to accept the responsibility for everything that comes along with it.

i have no argument with that.. oil spills on the beaches are no fun and need to be cleaned up.

It’s not a reason to go screaming nuts about us killing the planet. The planet can take care of itself. It is WE who are threatened by all the various forms of “pollution”. Life will go on no matter how unfriendly the environment is to human life.

As long as we use oil there will be spills despite our best efforts to prevent them. If you think not, then come up with a better way, or a substitute for oil, and make your fortune.

measton, i cant find the original page with the 62M gallon data..

Google “oceanic oil seepage” and you’ll get a bunch of pages. But beware.. Some pages might claim even bigger amounts than that.

You refuse to admit, or are incapable of understanding that Main Street was bailed out when Wall Street was bailed out.

Really Joey we’ve been bailed out?

1. Have you looked at unemployment numbers.
2. Have you taken a look at how much investors make in their bank accounts?
3. Have you looked at future inflation which workers won’t be able to hedge against, but Wall STreet will.
4. Will VAT taxes and increased state taxes be a gift to mainstreet.

TARP was a gift to big banks at the expense of mainstreet.

measton, there’s an excellent chance that only reason you are able go online today is because businesses and banks and all the rest were rescued from disaster.. and your ISP is still connected..

Did a few bailouts cure the fantastic amount of damage WE DID to our economy? No.. of course not. We are gonna pay for OUR mistakes for a long, long time.

Why do people not see that disconnecting business’s health from our own financial health is like disconnecting our heads from our shoulders.
And not just financial. More of us would likely survive a nuclear holocaust than would survive without businesses to feed, clothe and shelter us..

“What’s good for Wall St is good for Main St” arguments make me throw up in my mouth. But since joeyinCA is an expert on economics, monetary policy, immigration laws AND Earth systems, he must be right!

there’s an excellent chance that only reason you are able go online today is because businesses and banks and all the rest were rescued from disaster.. and your ISP is still connected..

Please
The gov should have taken over these banks and sold off the pieces. They could have loaned the free FED money to banks that were more responsible, that didn’t have massive leverage. They could have stimulated the economy by rebuilding our infrastructure and a host of other jobs programs. The GS bonus pool should tell you who benefited most from Gov handouts.

I am nowhere near an expert in any of those fields, but discussing issues with you hasn’t so far required it.
—-
Give me one example of any transaction .. any.. that you think is never good for both main street and wall street. My task is to illustrate how it might be mutually beneficial.

And since i haven’t even thought this through yet, and may have missed something plainly obvious, it’s a good opportunity for you to prove what a dunce I am..

measton..
please?
That’s your response?

Not “No, joey, you’re wrong. I would be online regardless of the bailouts because.. ” ?
—–

Yeah… we coulda bailed out the more responsible banks. That would have cost us practically nothing becasue there were none.

Yeah… we coulda bailed out the more responsible banks. That would have cost us practically nothing becasue there were none.

Wrong there were plenty of local and regional banks that did not have the leverage of the Wall Street Banks. These are the banks they are currently being closed by the FDIC. It should have been the otherway around. Shut down Wall Street Banks and support the regional banks. They may have made poor quality loans which they bundled and sold to Wall Street, because there was a market, but it was Wall Street that created this market via fraud. Thus they are ultimately responsible.

The paragraph that followed the “Please” points out that I think you are wrong.

The gov could have supported jobs which would have saved the ISP. If not they could have supported the ISP providers with a loan.

“WE DID to our economy?”

Which Megabank is it again that employs you, Joey?

measton, just because those small banks didn’t have access to the leverage afforded to big ones, it doesn’t mean they were acting responsibly
They took full advantage of whatever leverage was available to them.

To me, a responsible bank would be one that didn’t drink the KoolAid.. Those are as rare as.. i dunno.. pick something.

To me, a responsible bank would be one that didn’t drink the KoolAid.. Those are as rare as.. i dunno.. pick something.

The times you quit posting after losing the debate?

Wrong answer. Never mind, that answer would support your point.

Well joey, at least we know who’s sock puppet your are.

Almost zero.
Right answer Rio.. It suits me and also you… along with almost everyone else around here. Quitters are rare as .. i dunno.. pick something.
——

Anyway, if we gave 1,000 billion dollars to responsible, small banks, they would transform into a few huge big banks which we then expect to “responsibly” run and control the financial system.

But since we have decided big banks are prone to corruption, inherently evil and /or are by definition TBTF, and the whole objective is to rid ourselves of megabanks, it doesn’t make any sense to create new ones to replace the failed ones.. does it?

Almost zero.
Right answer Rio.. It suits me and also you…

It was not really the right answer but it was for my joke. Sometimes I like humor more than proving points.

But there were many banks that did not drink ENOUGH of the Koolaid to kill themselves and did not require bailouts and then give bonuses with taxpayer money.

That’s why there is moveyourmoney.info

It talks about it.

Rio.. i have given the practicality of this small-bank thing at least some thought.

A business is an organism that, unrestricted, will grow as fast as it can and as big as it can… like a fish in a pond who’s size is limited only by things like it’s food supply and the pond’s limited oxygen content.

imo, the only way to limit a bank’s maximum size is to limit it’s market, either geographically or similarly. While limiting it’s region is artificial, it allows banks maximum continued freedom to provide all the various services that are now available, and allows ourselves continued access to that maximum of services.
—-

I think we could painlessly limit bank size it if we really wanted to. But I do not think we’ve considered all the consequences of being stuck with tiny banks.

For instance, funding a big project could easily be beyond one bank’s reserve capabilities. We’d need a coalition of banks to get some things done, or perhaps be forced to use large foreign banks..
Coalitions would be hard to organize and are as troublesome, costly and wasteful as any bureaucracy is expected to be, and would contain their own subset of potentially negative consequences.
Foreign banks are the last thing I would want to be dependent on for anything.

Not to say that this example of “big projects” is a deal breaker, but there’s gotta be thousands of similar situations that could prove very problematic in a strictly small-bank economy.

I think we could painlessly limit bank size it if we really wanted to. But I do not think we’ve considered all the consequences of being stuck with tiny banks.

Ok, but I don’t think people are talking about tiny banks. The relative sizes and relative market share distributions of say 1995 would fine.

It’s out of control now:

“The four major U.S. banks: Bank of America, Citigroup, JP Morgan Chase and Wells Fargo, issue two-thirds of the credit cards in this country, write half of the mortgages and collectively hold $7.4 trillion in assets, about 52 percent of the nation’s estimated total output last year.

“Despite the fact that we bailed these banks out because they were too big to fail, incredibly, three out of four of these institutions are now larger today than they were when we bailed them out. Enough is enough.”

Sen. Bernie Sanders

http://sanders.senate.gov/newsroom/news/?id=aeec9d75-4dbf-474e-9f09-85db2c510687

correct.. people are NOT talking about “tiny” banks.. because they are fearful of committing themselves to ANY “proper” size.

How small must a bank be to avoid the problems we claim to attribute to a big banks size?
As a legislator who intends on writing laws and passing regulations, you must decide on solid numbers, not vague adjectives like small and big..
—–

tell ya what.. While the big-bank controversy will be hashed around in the papers and among politicians for as long as the recession lasts, once we’re financially secure again, (except for some regulatory window dressing to appease a few politically powerful special interests and a bone or two thrown to the “outraged” public) it’ll be decided that precisely what we have now is good enough for us.

“How small must a bank be to avoid the problems we claim to attribute to a big banks size?”

1. A good start would be to look at the banks on the Fed/Treasury TBTF list.

2. Then for good measure, don’t allow any bank to get any larger than 1/2 the size of the smallest one on the TBTF list.

It’s just a rule of thumb, but it seems like a reasonable place to start.

Sort of: the difference is that (in theory) that money has to be paid back, while the banksters get to keep their Bailout.

That being said, a lot of that money will not be paid back, and the costs will instead be shifted and spread around, hitting savers and fixed income people the hardest via dollar devaluation even though they ironically had the least to do with this mess.

measton,

Have you ever wondered why $50k/yr wage slaves pander and cheerlead for the wealthy elite?

In the US you also have to worry about a large armed group of citizens, many in militias. The only thing that keeps some of these groups from going native is that their life is pretty good in terms of a job that can provide food and shelter and play things for the weekend. Take that away and I suspect you will see them take what they can.

“Have you ever wondered why $50k/yr wage slaves pander and cheerlead for the wealthy elite?”

Because too many people in this country think that “someday” with enough brown-nosing/greed/education/work/whatever they can become one of the elite. They don’t understand how the game works, and thus they dream of becoming a ruling sociopath vs. not wishing to be ruled by sociopaths.

Exactly. So many people think that there is a real meritocracy here, but nothing could be further from the truth.

For example, if you are a legacy applicant to one of the “elite colleges” (i.e. a family member went there before you and gave cash), your chance of acceptance sky rockets. Once a poor, non-legacy student realizes that he or she is only at the “elite school” to increase the average SAT score of the privleged dolts with whom he consorts, it becomes impossible to un-see that the game is rigged.

Without a “red pill” experience of this type to truly demonstrate how rigged the game is and how it perpetuates itself, voters will continue to take the blue pill and vote against their own economic self-interest in order to “preserve the sanctity of marriage” or other such drivel.

…and, and them thar dang socialeests!

So long as the banksters stole their money fair and square, it should be theirs to keep.

you and your “stole”..
Stealing is a crime, and no criminal activity has been discovered or haven’t you heard. And we are presumed innocent until proven guilty.. probably never heard of that one either..

And probably never heard of lying under oath or bearing false witness.. but this is not a court of law and you’re free to express whatever you like. Vehement, prejudiced anti-bankster propaganda is an old song.. it used to have a different name.

Vehement, prejudiced anti-bankster propaganda is an old song.. it used to have a different name.

And after a forty year absence, the re-mix is just starting to climb up the charts.

The Jolly Banker

Again joey, you lie.

Google News alone shows you to be a liar.

You are an amazing textbook example of self delusion.

$60 million settlement for Massachusetts subprime mortgages

On May 10, 2009, the Goldman Sachs Group agreed to pay up to $60 million to end an investigation by the Massachusetts attorney general’s office into whether the firm helped promote unfair home loans in the state. The settlement will be used to reduce the mortgage payments of 714 Massachusetts residents who had secured subprime mortgages funded by Goldman Sachs. Michael DuVally, a spokesman for Goldman, said it was “pleased to have resolved this matter,” and declined to comment further. This settlement may open the door to state government actions against Goldman throughout the United States aimed at securing compensation for predatory mortgage lending practices

- Wikipedia

you called me a liar because of a settlement? wow..
A settlement is not a conviction. It’s a contractual agreement.

wiki also has a dictionary.. wiktionary.org

“Stealing is a crime, and no criminal activity has been discovered or haven’t you heard.”

Absence of evidence is merely weak evidence of absence.

Besides, it ain’t over till it’s over, which’t ain’t yet.

Friday April 30, 2010

Bloomberg
Goldman Scrutinized by U.S. Prosecutors Examining SEC Case
April 30, 2010, 12:06 AM EDT
By Justin Blum and David Glovin

April 30 (Bloomberg) — Federal prosecutors in New York are investigating transactions by Goldman Sachs Group Inc., accused of misleading investors by U.S. securities regulators, to determine whether to pursue a criminal fraud case, according to two people familiar with the matter.
…

Why yes joey, a settlement for discontinuing an investigation is, indeed an admission of guilt… in the real world.

Some people just lose their heads when it comes to money.

I can see both your points and Joey’s. I have read about the bad effects of concentrated wealth at the very top.

Right now for example we are seeing a new bad effect: The birth rate among the middle class is far lower than a couple of generations ago.

Well-raised children with the proper love and nurturing are rarer and rarer in this society.

Meanwhile the poorest nations and the Muslim nations are having population booms.

The middle class in America is squeezed to death. We’d be a strong and stable society if we’d return to having mostly one income families where one spouse stays home, also where one can work within a reasonable drive from home to a job, like ten minutes instead of two hours.

Maybe internet will help return society to that structure. But the massive government spending must be stopped. Then focus on paying down the debt with unchanged tax code. After about ten years of this, cut taxes drastically.

I am against increasing taxes on the job providers - which is really the wealthy. Let everyone be on an even playing field and abolish the income tax for all at some point.

I am against increasing taxes on the job providers - which is really the wealthy.

I agree with most of your post but not that part.

I think we should tax the very rich much more. Like 70% as we did in the 50s -70’s

Reasons:
1. Progressive taxes are part of American history and values. We’ve strayed from our core values.

2. The very rich are the only ones who benefited from the past 30 years at the same time their taxes have been slashed. We have re-distributed wealth in this country from the middle-class and small business owners to the already rich. This wealth re-distribution has hurt America. We need to re-distribute it back to the middle-class.

3. The rich have the money and when one is that rich, more tax will not affect their standard of living. (3 luxury houses instead of 5 is no big deal)

4. The super rich do not create American jobs anymore. They outsource them, downsize and cut pay. The super rich, especially the Wall Streeters suck the money from America’s productive class (The middle-class) The real productive class (middle-class and upper middle-class small business owners should be given the breaks) Down with the monopolistic oligarchy. Up with the real capitalists.

5. If taxed more, the rich will work much harder to make more money. It’s too easy now. They got lazy. They leach off the rest of Americans because their money comes too easily. They feel they are entitled to be billionaires.

Well indeed the rich benefit most from the police and military, but if we had an equal playing field, it would ENCOURAGE poor people to move up to middle class and middle class people to move up to the wealthy class - entrepreneurs.

The drive to create wealth creates jobs.

“Well-raised children with the proper love and nurturing are rarer and rarer in this society.

Meanwhile the poorest nations and the Muslim nations are having population booms.”

I’ve got the solution: Let lots of illegal immigrants from Muslim nations slip across the border and turn them loose on Wall Street.

…it would ENCOURAGE poor people to move up to middle class and middle class people to move up to the wealthy class - entrepreneurs.

Bill,

You keep insinuating that people who are poor/middle class somehow lack initiative or a decent work ethic. I’ve seen far too many **very productive** poor people to believe this theory is correct.

I also question the assertion that Goldman Sachs (or other financial wizards) create jobs. In many cases, they destroy them.

If the shadow inventory was sold, bad things would happen, including:

1) Banks having to recognize losses.

2) The Bubble dream bursting as reality comes into view.

3) Real estate values would drop, causing a drop in property taxes.

4) Crooks would no longer be rewarded and prudent people would be able to afford housing.

So, it’s in the interest of those in power to keep the shadow inventory hidden until it rots away vs. allowing there to be plenty of affordable housing.

How is the FedGov backing the jumbos? I thought the GSE limit was $729,750 or so. Do you have some evidence to back up your assertion?

Who will invest in Jumbos if Megabank, Inc is broken up into non-systemically risky pieces? Will the GSE conforming loan limit be lifted about $729,750 to let them do it?

BusinessWeek Logo
Thursday April 29, 2010

Bloomberg
Wall Street Begins Taking Bets on Jumbo-Mortgage Debt (Update1)
April 28, 2010, 7:07 PM EDT
(Adds prices in seventh paragraph.)

By Jody Shenn

April 28 (Bloomberg) — Wall Street banks began taking bets on pools of jumbo-mortgage bonds as trading started today on four new credit-default-swap indexes.

The PrimeX indexes, administered by London-based Markit Group Ltd., are similar to the ABX indexes tied to subprime debt that began in early 2006, allowing easier wagers on the subsequent record defaults among homeowners with bad credit.

When a plan to create the indexes linked to older prime loans larger than the limits for government-supported Fannie Mae and Freddie Mac was announced in December, Wells Fargo & Co. analyst Glenn Schultz suggested investors consider selling jumbo-mortgage securities because PrimeX trading could drive down their prices, as happened with subprime bonds and the ABX indexes he had called “Frankenstein’s monster.”

“In this yield range PrimeX looks like an attractive alternative to both ABX and jumbo cash bonds,” Bank of America Corp. analysts led by Chris Flanagan in New York wrote in an April 26 report. In “pre-open” inter-dealer trading, the indexes gained, leaving potential yields at 6 percent to 8 percent, the analysts said.

The four PrimeX indexes are each linked to 20 originally AAA rated securities from 18-month periods, ending June 30, 2006 and Dec. 31, 2007, according to a document on Markit’s Web site. Two of the indexes are tied to fixed-rate loans and two track adjustable-rate mortgages.

‘Price’ Basis

The contracts will trade on a “price” basis, with the cost of buying default protection ranging from 442 basis points to 458 basis points a year plus an upfront payment equal to the difference between 100 and an index’s level, translated to a percentage of the size of the positions. Negative upfront amounts would be paid by the seller of protection to the buyer.

Three of the four indexes closed above 100, according to Markit’s Web site. Their levels ranged from 97.73 to 107.23.

Credit-default swaps on structured-finance securities offer payments if the debt isn’t repaid as scheduled, in return for regular insurance-like premiums. A basis point equals $1,000 annually on a contract protecting $10 million of debt.

In a hearing yesterday in Washington with Goldman Sachs Group Inc. executives, U.S. Senator Claire McCaskill, a Democrat from Missouri, called at least one type of credit-default swap a “La-La Land of ledger entries.”

“It’s not investment in a business that has a good idea,” she said. “It’s not assisting local governments in building infrastructure. It’s gambling. Pure and simple, raw gambling.”
…

“How is the FedGov backing the jumbos? I thought the GSE limit was $729,750 or so. Do you have some evidence to back up your assertion?”

I thought the jumbo was above $417k.

Where would prices for a 3/2 ranch settle in San Diego, CA if the Jumbo went away?

MrBubble, I don’t think that’s really an example of an ad hominem attack, because it does, in a way, address Obama’s argument– it points out an alleged inconsistency between his words and deeds. Ad hominem would be criticizing him for something unrelated to the topic, e.g. he has big ears and looks dumb, so he doesn’t know what he’s talking about.

Same with your comment re: Al Gore and carbon footprints below.

Well, I’ll come out and say it. He has big ears and he looks dumb. He sounds as if he is trying so hard to be hip.

You’re right. It’s Ad Hominem Tu Quoque, I think.

From The Google:
“This fallacy is committed when it is concluded that a person’s claim is false because
1) it is inconsistent with something else a person has said or
2) what a person says is inconsistent with her actions. This type of “argument” has the following form:

Person A makes claim X (people shouldn’t make too much money).
Person B asserts that A’s actions or past claims are inconsistent with the truth of claim X (Obama makes more than the average salary).
Therefore X is false. People don’t make too much money.

The fact that a person makes inconsistent claims does not make any particular claim he makes false (although of any pair of inconsistent claims only one can be true - but both can be false). Also, the fact that a person’s claims are not consistent with his actions might indicate that the person is a hypocrite but this does not prove his claims are false. “

Ad hominem attack.

I’m not out to attack Obama. I didn’t vote for him, and I’m not a huge fan - I’ll be honest. But I’m simply pointing out here that if thinks there’s a point at which someone has made “enough” money, why doesn’t he step up and lead by example. Especially in this case, where the budget and taxpayers certainly could use a break.

Also, the fact that a person’s claims are not consistent with his actions might indicate that the person is a hypocrite but this does not prove his claims are false

Hadn’t refreshed before posting above. I’m not claiming people don’t make too much money. I’m simply saying that if he really believes that, he should step up and lead by example.

Personally, I don’t believe there should be caps to income/wealth/gains one makes legally. But my point wasn’t to refute what Obama said. I was simply stating that if he really believes that, he should step up to the plate and give up his salary (everything is paid for him while in office anyhow), as well as his pension (or whatever they call it for the PotUS).

“Also, CEOs don’t collect their salaries by pointing a gun at taxpayers.”

They don’t? So what was TARP again?

Do you want me to explain how a refrigerator works? The Ideal Gas Law? Non-linear systems? The carbon cycle? What?

Are you drinking already?

Look, I keep my own posts to real estate and business anecdotes and little things that I read about those subjects. I come over the top on religious, bigoted and/or anti-environmental posts that are not germane to housing. You have encroached into these areas and I am now roundly thrashing you. You want more? I’ve got 2 1/2 hours more of joey beat downs.

MrBubble

ok.. so maybe I don’t recall my high school physics classes.. shame on me.
My point was it’s possible that nothing conventional, much less a terrorist, was needed to ignited the gases..

I got this from a 2-Heptanone MSDS sheet.

General Fire Hazards:
Product is a combustible liquid. The vapor is heavier than air. Vapors or gases may ignite at distant ignition sources and flash back.

Hot vapor or mists may be susceptible to spontaneous combustion when mixed with air. Ignition temperatures decrease with increasing vapor volume and vapor/air contact time and are influenced by pressure changes. Therefore, ignition may occur below published ignition temperatures.

Flash point is about 39C for that stuff.. practically room temperature in the gulf.

No doubt this ketone along with who-knows what else is in the gases that spew from oil wells.

Don’t they all?

(unfortunately)

Well - almost all. Ken Lay probably wishes he still had his parachute, though I’m not sure how fireproof it would have been.

With your logic what’s wrong with Mexicans or any illegals coming and staying in America? It’s evolution, right? We will do our best to keep them away and they will do their best to come here. That’s why I don’t worry about legal and illegal immigration. Let the nature run its course. If I were in Mexico I would want to get the hell out of there. And if US turns into Mexico I will be the first to leave US for greener pastures. I don’t hold too much value into this patriotic BS. I am an American by an accident of birth. Had my parents conceived me a millisecond sooner or later, it would have been somebody else.

Survival is what I am interested.

Fine with me but we have a right to defend ourselves from illegals - particulaorly because they are driving up the ehalth care costs, they are filling our schols with their children, which costs taxpayer money, and they are filling our jails. I guess you might not live in AZ. There is a war in the southern part of the state. Landowners are overrun by illegals. The situation is getting worse and worse. I keep up with Arizona news and noticed. It’s due to illegal aliens that are endangering Arizonans more and more.

I’m normally not a government supporter. But I want people to pay their own way. If we can guarantee they pay their own health insurance and health care and get paid by their native countries for the jailtime of their crimes, and if they pay for their children’s education, I’m okay on open borders.

Otherwise you are welcome to donate your money to illegals. Just don’t force me to donate mine.

people to pay their own way.

I agree with most of what you said. I am also in favor of landowners or other picking their guns if they felt their lives are threatened. However I don’t think the Govt will let the landowners protect themselves. We have a left party which sees these immigrants as a solid voting block that will help achieve the perpetual power grad and a fascist party which only interested in providing cheap slave labors to their corporate masters. And not to mention both of these parties support some kind of welfare state in the expense of law abiding middle class citizens like you and me. As Ron Paul says, we can’t have a welfare state and complain that we have too many illegals.

They support a welfare state alright…. for the rich.

Another thing they oughta do, imo, is outlaw butchers from taking the most tender, choicest cuts from the best animals for themselves and friends at wholesale prices… maybe denying the public any chance at all to get them.

And while we’re at it, there’s gotta be millions of similar examples where someone “in the business” takes advantage of being in the business..

We’re in the mood to rid ourselves of corruption and insider action, so lets list and outlaw all of them. Maybe the ACLU can do it by way of “Equal protection under the law” in a class action suit, or some such thing..

Then we can vilify and persecute anyone who ever took part in such despicable behavior.. What fun..