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by Ben Stein, author of "How to Ruin the United States of
America: http://easyurl.net/Stein
1) Have a fiscal policy that creates immense deficits in
good times and bad, burdening America's posterity with
staggering burdens of repaying the debt.
2) Eliminate regulation of Wall Street and/or fail to
enforce the regulations that already exist, instead
trusting Wall Street and other money managers and
speculators to manage other people's money with few or no
regulations and little oversight...
Continued: http://easyurl.net/Ruin
On Oct 7, 10:33 am, Dave U. Random <anonym...@anonymitaet-im-
inter.net> wrote:
> by Ben Stein, author of "How to Ruin the United States of
> America:http://easyurl.net/Stein
> Continued:http://easyurl.net/Ruin
Posted on Monday, October 6, 2008, 12:00AM
1) Have a fiscal policy that creates immense deficits in good times
and bad, burdening America's posterity with staggering burdens of
repaying the debt.
[TRUE, BUT THE RICARDO EQUIVALENCE THEORY OF ECONOMICS SAYS DEFICITS
DON'T MATTER. IT'S REALLY WHAT THE DEFICITS ARE USED FOR--AND IN THIS
RESPECT I AGREE WITH STEIN IN THAT THE DEFICITS REPRESENTED WASTED
MONEY RATHER THAN BUILDING INFRASTRUCTURE]
2) Eliminate regulation of Wall Street and/or fail to enforce the
regulations that already exist, instead trusting Wall Street and other
money managers and speculators to manage other people's money with few
or no regulations and little oversight.
[REGULATION IS NOT THE ANSWER]
3) Have an energy policy that disallows producing our own energy and
instead requires that we buy energy from abroad, thus making our oil
prices highly volatile and creating large balance of payments
deficits, lowering the value of the dollar and thus making the problem
get progressively worse.
[THE USA CANNOT PRODUCE ALL ITS ENERGY. ABSENT IMPORTATION, IT MUST
EITHER REDUCE OR DEVELOP NEW TECHNOLOGY LIKE CLEAN COAL OR FUSION/
FISSION NEXT-GEN NUCLEAR]
4) Have Congress mandate that banks and other financial entities lend
money to persons they know in advance to have poor credit ratings or
none at all.
[I DOUBT IF THIS IS THE REASON FOR THE CRISIS--IT'S MORE LIKE A
CLASSIC MIDDLE-CLASS OVEREXPANSION AND THEN CREDIT CONTRACTION--IT'S
HAPPENED THROUGHOUT HISTORY]
5) Allow investment banks, insurers, and banks to bet their entire net
worth and then some on the premise that borrowers known to be
improvident will in fact repay those loans.
[WELL THEY SHOULD BE ALLOWED TO FAIL--MORAL HAZARD OTHERWISE]
6) Allow the creation of large betting pools called "hedge funds" that
can move markets and control the outcome of trading, thus taking a
forum for savings and retirement for families and making it into a
rigged casino game that exists primarily to fleece suckers like
ordinary working men and women.
[B.S. POPULIST RHETORIC. I GUESS THE AUTHOR IS AGAINST SHORT SELLING
TOO? A JOKE POSITION]
7) Have laws that protect corporate officers from being sued for
misconduct but at the same time punish lawyers in the private sector
who ferret out such misconduct and try to make accountable the people
responsible for shareholder and investor losses. If one of those
lawyers gets particularly aggressive in protecting stockholders, put
him in prison.
[I HAVE NO IDEA WHAT STEIN IS TALKING ABOUT. SURELY HE CAN'T BE
REFERRING TO MILBERG, WEISS CAN HE? THAT FIRM WAS PURE FRAUD.]
8) Appoint as head of the United States Treasury Department a man
whose whole life was spent on Wall Street, who became fantastically
rich through his peddling of junk bonds at his firm while the firm
later sold short those same sorts of bonds.
[OK, NOW A CONSPIRACY THEORY. NEXT!]
9) Scare Americans into putting up $750 billion of their hard earned
money to bail out the billionaires and their friends who created the
market for loans to poor credit risks (The "subprime" market) and the
unbelievably large side bets on those loans, promising that such a
bailout would save the retirement savings of Americans, then allow the
immense hedge funds to make the market crater immediately afterwards.
[YES, TRUE]
10) Propose to save the situation by surtaxing the oil industry, which
is owned by our fellow Americans, mostly in their retirement plans,
thus penalizing Americans for investing in companies that efficiently
and legally produce an indispensable product.
[NO IDEA WHAT THIS IS. DAILY KOS HAS A SUGGESTION TO HAVE A SPECIAL
SURTAX ON THE RICH, TO FUND THE BAILOUT, BUT I'VE NOT HEARD OF AN
ENERGY SURTAX.]
11) Insist that the free market requires that banks and insurers with
friends of the Secretary of the Treasury be saved but allow other
entities not so fortunate to fail, thus creating total uncertainty and
terror among financial institutions, and demolishing all of the
confidence built up in financial circles since the days of FDR.
[PERHAPS. CONJECTURE.]
12) Then have the Republican candidate say he would keep on the job
the Treasury Secretary who facilitated the crisis, failed to protect
the nation from the crisis, got the taxpayers to pony up to save his
Wall Street buddies, and have the Democratic candidate, as noted, say
he would save the day by taxing the stockholders of energy companies.
[OK, GOT IT. I GUESS OBAMA HAD MENTIONED AN ENERGY SURTAX]
There, that should do it.
[ANOTHER PIECE OF POPULIST PABLUM FROM THE FERRIS BUEHLER PRINCIPAL]
RL
On Oct 7, 1:33 pm, Dave U. Random <a...@a...net>
wrote:
> by Ben Stein, author of "How to Ruin the United States of
> America:http://easyurl.net/Stein
>
Seems pretty consistently wrapped, to a redundant point where a
surmise hardly need be itemized;- Nevertheless, with many points
already played through, perhaps for another difference in postulates
in mind:
(in part) http://www.time.com/time/business/article/0,8599,184
6450,00.html?xid=rss-business
The Historical Parallels
We tend to think of the Depression as having been triggered by the
stock-market crash of 1929. The Wall Street crash is conventionally
said to have begun on "Black Thursday" -- Oct. 24, 1929, when the Dow
Jones industrial average declined 2% -- though in fact the market had
been slipping since early September. On "Black Monday" (Oct. 28), it
plunged 13%, the next day a further 12%. Over the next three years,
the U.S. stock market declined a staggering 89%, reaching its nadir in
July 1932. The index did not regain its 1929 peak until 1954.
On Sept. 29 of this year, as investors and traders reacted to
Congress's rejection of the bailout plan presented by Treasury
Secretary Hank Paulson, the stock market sell-off was dramatic: the
Dow fell nearly 7% that day, a one-day drop that has been matched only
17 times since the index's birth in 1896. From its peak last October,
the Dow has fallen more than 25%.
(add to that, 10/2 pub, this past week's dismal showing -F.)
Yet the underlying cause of the Great Depression -- as Milton Friedman
and Anna Jacobson Schwartz argued in their seminal book A Monetary
History of the United States: 1867-1960, published in 1963 -- was not
the stock-market crash but a "great contraction" of credit due to an
epidemic of bank failures.
The credit crunch had surfaced several months before the stock-market
crash, when commercial banks with combined deposits of more than $80
million suspended payments. It reached critical mass in late 1930,
when 608 banks failed -- among them the Bank of the United States,
which accounted for about a third of the total deposits lost. (The
failure of merger talks that might have saved the bank was another
critical moment in the history of the Depression.)
As Friedman and Schwartz saw it, the Fed could have mitigated the
crisis by cutting rates, making loans and buying bonds (so-called open-
market operations). Instead, it made a bad situation worse by reducing
its credit to the banking system. This forced more and more banks to
sell assets in a frantic dash for liquidity, driving down bond prices
and making balance sheets look even worse. The next wave of bank
failures, between February and August 1931, saw commercial-bank
deposits fall by $2.7 billion -- 9% of the total. By January 1932,
1,860 banks had failed.
(there are 7500 banks in the U.S. today -F.)
On Oct 7, 11:56 am, raylopez99 <r...@y...com> wrote:
> 2) Eliminate regulation of Wall Street and/or fail to enforce the
> regulations that already exist, instead trusting Wall Street and other
> money managers and speculators to manage other people's money with few
> or no regulations and little oversight.
>
> [REGULATION IS NOT THE ANSWER]
How did you derive/deduct this conclusion?
A logical deduction from anti-regulation to crisis might look
this:
1) Premise: if and only if there is no effective regulation, then
out-of-control business operation.
2) Premise: if out-of-control business operation, then eventually
financial crisis.
3) Conclusion: thus no effective regulation can cause financial
crisis.
The first premise is a necessary and sufficient condition, the
second premise is a sufficient condition. Thus lack of effective
regulation will cause financial crisis. There could be other factors
that cause financial crisis. But anti-regulation is a sure way
(sufficient) to create financial crisis.
On Oct 7, 5:04 pm, Flasherly <g...@i...net> wrote:
> On Oct 7, 1:33 pm, Dave U. Random <a...@a...net>
> wrote:
>
> > by Ben Stein, author of "How to Ruin the United States of
> > America:http://easyurl.net/Stein
>
> Seems pretty consistently wrapped, to a redundant point where a
> surmise hardly need be itemized;- Nevertheless, with many points
> already played through, perhaps for another difference in postulates
> in mind:
>
> (in part)http://www.time.com/time/business/article/0,859
9,1846450,00.html?xid=...
>
> The Historical Parallels
> We tend to think of the Depression as having been triggered by the
> stock-market crash of 1929. The Wall Street crash is conventionally
> said to have begun on "Black Thursday" -- Oct. 24, 1929, when the Dow
> Jones industrial average declined 2% -- though in fact the market had
> been slipping since early September. On "Black Monday" (Oct. 28), it
> plunged 13%, the next day a further 12%. Over the next three years,
> the U.S. stock market declined a staggering 89%, reaching its nadir in
> July 1932. The index did not regain its 1929 peak until 1954.
>
> On Sept. 29 of this year, as investors and traders reacted to
> Congress's rejection of the bailout plan presented by Treasury
> Secretary Hank Paulson, the stock market sell-off was dramatic: the
> Dow fell nearly 7% that day, a one-day drop that has been matched only
> 17 times since the index's birth in 1896. From its peak last October,
> the Dow has fallen more than 25%.
>
> (add to that, 10/2 pub, this past week's dismal showing -F.)
>
> Yet the underlying cause of the Great Depression -- as Milton Friedman
> and Anna Jacobson Schwartz argued in their seminal book A Monetary
> History of the United States: 1867-1960, published in 1963 -- was not
> the stock-market crash but a "great contraction" of credit due to an
> epidemic of bank failures.
>
> The credit crunch had surfaced several months before the stock-market
> crash, when commercial banks with combined deposits of more than $80
> million suspended payments. It reached critical mass in late 1930,
> when 608 banks failed -- among them the Bank of the United States,
> which accounted for about a third of the total deposits lost. (The
> failure of merger talks that might have saved the bank was another
> critical moment in the history of the Depression.)
>
> As Friedman and Schwartz saw it, the Fed could have mitigated the
> crisis by cutting rates, making loans and buying bonds (so-called open-
> market operations). Instead, it made a bad situation worse by reducing
> its credit to the banking system. This forced more and more banks to
> sell assets in a frantic dash for liquidity, driving down bond prices
> and making balance sheets look even worse. The next wave of bank
> failures, between February and August 1931, saw commercial-bank
> deposits fall by $2.7 billion -- 9% of the total. By January 1932,
> 1,860 banks had failed.
>
> (there are 7500 banks in the U.S. today -F.)
There was a logical error in Friedman's analysis. If bad Fed move
precedes the Great Depression, conducting the reverse of the Fed's bad
move does not necessary produce different result -- If A then B does
not mean If not-A then not-B.
Bernanke has tried every thing in his arsenal for few months now based
on Friednman's theory, did he prove that Frendman's theory is correct?
No, the meltdown continues. It indicates that the REAL problem lies
elsewhere -- say, the lack of effective regulation in the banking
sector (the anti-regulation stance proposed by the libertarians).
On Oct 7, 5:46 pm, k...@y...com wrote:
> On Oct 7, 11:56 am, raylopez99 <r...@y...com> wrote:
>
> > 2) Eliminate regulation of Wall Street and/or fail to enforce the
> > regulations that already exist, instead trusting Wall Street and other
> > money managers and speculators to manage other people's money with few
> > or no regulations and little oversight.
>
> > [REGULATION IS NOT THE ANSWER]
>
> How did you derive/deduct this conclusion?
>
> A logical deduction from anti-regulation to crisis might look
> this:
> 1) Premise: if and only if there is no effective regulation, then
> out-of-control business operation.
> 2) Premise: if out-of-control business operation, then eventually
> financial crisis.
> 3) Conclusion: thus no effective regulation can cause financial
> crisis.
>
> The first premise is a necessary and sufficient condition, the
> second premise is a sufficient condition. Thus lack of effective
> regulation will cause financial crisis. There could be other factors
> that cause financial crisis. But anti-regulation is a sure way
> (sufficient) to create financial crisis.
Rethink your logical premises. First, they don't look sound. Your
truth table seems lacking (two premises then a conclusion that doesn't
follow). Second, human affairs are not binary "If/then". Only
boolean logic is. History should be your guide: no amount of logic
can refute Marx's theorem's (which are internally consistent, although
his labour theory of value has some logical holes in it, as evidenced
in the numbers that don't compute in Das Capital). But history can
and did.
RL
On Oct 7, 5:55 pm, k...@y...com wrote:
> On Oct 7, 5:04 pm, Flasherly <g...@i...net> wrote:
>
>
>
> > On Oct 7, 1:33 pm, Dave U. Random <a...@a...net>
> > wrote:
>
> > > by Ben Stein, author of "How to Ruin the United States of
> > > America:http://easyurl.net/Stein
>
> > Seems pretty consistently wrapped, to a redundant point where a
> > surmise hardly need be itemized;- Nevertheless, with many points
> > already played through, perhaps for another difference in postulates
> > in mind:
>
> > (in part)http://www.time.com/time/business/article/0,859
9,1846450,00.html?xid=...
>
> > The Historical Parallels
> > We tend to think of the Depression as having been triggered by the
> > stock-market crash of 1929. The Wall Street crash is conventionally
> > said to have begun on "Black Thursday" -- Oct. 24, 1929, when the Dow
> > Jones industrial average declined 2% -- though in fact the market had
> > been slipping since early September. On "Black Monday" (Oct. 28), it
> > plunged 13%, the next day a further 12%. Over the next three years,
> > the U.S. stock market declined a staggering 89%, reaching its nadir in
> > July 1932. The index did not regain its 1929 peak until 1954.
>
> > On Sept. 29 of this year, as investors and traders reacted to
> > Congress's rejection of the bailout plan presented by Treasury
> > Secretary Hank Paulson, the stock market sell-off was dramatic: the
> > Dow fell nearly 7% that day, a one-day drop that has been matched only
> > 17 times since the index's birth in 1896. From its peak last October,
> > the Dow has fallen more than 25%.
>
> > (add to that, 10/2 pub, this past week's dismal showing -F.)
>
> > Yet the underlying cause of the Great Depression -- as Milton Friedman
> > and Anna Jacobson Schwartz argued in their seminal book A Monetary
> > History of the United States: 1867-1960, published in 1963 -- was not
> > the stock-market crash but a "great contraction" of credit due to an
> > epidemic of bank failures.
>
> > The credit crunch had surfaced several months before the stock-market
> > crash, when commercial banks with combined deposits of more than $80
> > million suspended payments. It reached critical mass in late 1930,
> > when 608 banks failed -- among them the Bank of the United States,
> > which accounted for about a third of the total deposits lost. (The
> > failure of merger talks that might have saved the bank was another
> > critical moment in the history of the Depression.)
>
> > As Friedman and Schwartz saw it, the Fed could have mitigated the
> > crisis by cutting rates, making loans and buying bonds (so-called open-
> > market operations). Instead, it made a bad situation worse by reducing
> > its credit to the banking system. This forced more and more banks to
> > sell assets in a frantic dash for liquidity, driving down bond prices
> > and making balance sheets look even worse. The next wave of bank
> > failures, between February and August 1931, saw commercial-bank
> > deposits fall by $2.7 billion -- 9% of the total. By January 1932,
> > 1,860 banks had failed.
>
> > (there are 7500 banks in the U.S. today -F.)
>
> There was a logical error in Friedman's analysis. If bad Fed move
> precedes the Great Depression, conducting the reverse of the Fed's bad
> move does not necessary produce different result -- If A then B does
> not mean If not-A then not-B.
>
> Bernanke has tried every thing in his arsenal for few months now based
> on Friednman's theory, did he prove that Frendman's theory is correct?
> No, the meltdown continues. It indicates that the REAL problem lies
> elsewhere -- say, the lack of effective regulation in the banking
> sector (the anti-regulation stance proposed by the libertarians).
Well, by your own logic, it does not prove Friedman was incorrect:
like you say, if not-A then not-B, so Bernanke trying Friedman's
theories, and failing, does not mean Friedman's theories are wrong,
just that another cause might be at play: "C". if not-A and C, then
B. But if not-A and not-C, then not-B. In short, many factors might
be at play, not just two factors A,B.
Sorry, but outside of Boolean Logic, life is not boolean.
RL
On Oct 7, 7:33 pm, Dave U. Random <a...@a...net>
wrote:
> by Ben Stein, author of "How to Ruin the United States of
> America:http://easyurl.net/Stein
>
> 1) Have a fiscal policy that creates immense deficits in
> good times and bad, burdening America's posterity with
> staggering burdens of repaying the debt.
>
> 2) Eliminate regulation of Wall Street and/or fail to
> enforce the regulations that already exist, instead
> trusting Wall Street and other money managers and
> speculators to manage other people's money with few or no
> regulations and little oversight...
>
> Continued:http://easyurl.net/Ruin
0) Elect a clueless moron for two consecutive terms.
"Evojeesus" <e...@m...com> wrote in message
news:1b5add21-5fdc-4bd5-bce8-521dd62b2923@i24g2000pr
f.googlegroups.com...
> On Oct 7, 7:33 pm, Dave U. Random <a...@a...net>
> wrote:
>> by Ben Stein, author of "How to Ruin the United States of
>> America:http://easyurl.net/Stein
>>
>> 1) Have a fiscal policy that creates immense deficits in
>> good times and bad, burdening America's posterity with
>> staggering burdens of repaying the debt.
>>
>> 2) Eliminate regulation of Wall Street and/or fail to
>> enforce the regulations that already exist, instead
>> trusting Wall Street and other money managers and
>> speculators to manage other people's money with few or no
>> regulations and little oversight...
>>
>> Continued:http://easyurl.net/Ruin
>
> 0) Elect a clueless moron for two consecutive terms.
misc.invest.stocks,misc.invest.mutual-funds,misc.inv
est.futures,misc.invest.options,misc.invest.technica
l
Is this group getting desperate or what?
On Oct 8, 7:00 pm, "Ed" <f...@f...net> wrote:
> "Evojeesus" <e...@m...com> wrote in message
>
> news:1b5add21-5fdc-4bd5-bce8-521dd62b2923@i24g2000pr
f.googlegroups.com...
>
>
>
>
>
> > On Oct 7, 7:33 pm, Dave U. Random <a...@a...net>
> > wrote:
> >> by Ben Stein, author of "How to Ruin the United States of
> >> America:http://easyurl.net/Stein
>
> >> 1) Have a fiscal policy that creates immense deficits in
> >> good times and bad, burdening America's posterity with
> >> staggering burdens of repaying the debt.
>
> >> 2) Eliminate regulation of Wall Street and/or fail to
> >> enforce the regulations that already exist, instead
> >> trusting Wall Street and other money managers and
> >> speculators to manage other people's money with few or no
> >> regulations and little oversight...
>
> >> Continued:http://easyurl.net/Ruin
>
> > 0) Elect a clueless moron for two consecutive terms.
>
> misc.invest.stocks,misc.invest.mutual-funds,misc.inv
est.futures,misc.invest.options,misc.invest.technic
al
>
> Is this group getting desperate or what?- Hide quoted text -
>
> - Show quoted text -
The US and UK governments must be getting desperate. After a week's
agonising the US finally managed to pass the $700bn bail-out scheme.
The result? Nothing; the market is still falling just as fast.
In the UK today the goverrnment announced a £50bn bail-out for the
banks AND a 0.5% cut in interest rates. Before that the market was
down 5%. There was a brief surge to 1% up after the announcements then
the market relapsed back to 5% down. In other words, no effect, and
its costing the taxpayers a lot of money.
I get the impression the governments not only failed to stop the
problem occurring in the first place through slack or incorrect
regulation but also don't really know how to stop their markets and
economies plunging down to a 1929-style recession.
Is this the fruit of the Bush/Blair moronocracies?
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