On Aug 7, 12:40 am, John Larkin <
jlar...@highlandtechnology.com>
wrote:
> On Sat, 4 Aug 2012 02:36:55 -0700 (PDT), Bill Sloman
>
> <
bill.slo...@ieee.org> wrote:
> >On Aug 4, 1:25 am,
dagmargoodb...@yahoo.com wrote:
> >> On Aug 3, 6:36 pm, miso <
m...@sushi.com> wrote:
>
> >> > On 8/3/2012 5:20 AM,
dagmargoodb...@yahoo.com wrote:
>
> >> > > On Aug 2, 3:16 pm, miso <
m...@sushi.com> wrote:
> >> > >>> AIUI, It is Harvard who locked up Obama's law school thesis...
> >> > >>> probably because it advocates communism.
>
> >> > >>> And a lot of schools have stopped having theses in "recent" years. For
> >> > >>> instance MIT no longer requires an undergraduate thesis.
>
> >> > >>> ...Jim Thompson
>
> >> > >> More likely you are full of shit that the thesis advocates communism.
> >> > >> For one thing, he didn't study economics,
>
> >> > > Roger that.
>
> >> > We need a president with a MBA.
>
> >> MBA <> "studied economics." Last week I heard Geithner and Steny
> >> Hoyer both say the economy's slowing, so gov't needs to spend more
> >> money. Brilliant.
>
> >> > What, you said we tried that once
> >> > before> Oh yeah, George W. Bush!
>
> >> > Just how did that work out?
>
> >> Not well, but trillions and trillions (and about 7 million jobs)
> >> better than now.
>
> >Sure - he sat on his hands while a house bubble blew up - generating
The government certainly didn't do anything to stop it. The bankers
had been campaigning for the Changes in the Glass-Steagall Act for
mnay years, and eventually got what they wanted, but Fannie Maue
didn't actually buy up any "bad paper" - homes loans made under the
Community Reinvestment Act
http://en.wikipedia.org/wiki/Community_Reinvestment_Act
sustained much the same default rate as regular home loans. It was the
sub-prime - ninja - loans from the bottom feeding mortgage lenders
that defaulted on a large scale in the aftermath of the sub-prime
mortgage crisis.
James Arthur claimed otherwise immediately after the bubble burst, but
he was - as usual - seeing what he wanted to see. When the numbers
came in, the Community Reinvestment Act loans turned out to have been
made to good credit risks who rarely defaulted.
It was the bottom-feeding end of the banking community who
manufactured the crisis. Every last one of them should now be doing
hard labour in a chain gang, but I don't think that anybody has been
either charged or convicted of making loans to people who shouldn't
have got them or charged with fraud for selling them on as if they
were regular home loans to people who looked likely to pay them back.
> W is on record as having warned about the real estate bubble, but
> nobody in Congress was listening.
It isn't the executive branch's business to warn about problems -
their job is to anticipate them. If Dubbya was actually worried, it
was his duty to get off his behind and do something to solve the
problem before it turned into a crisis.
> Too many people were getting "rich" from the appreciation of their real estate.
And were too dumb to realise that the appreciation was going to be
transient.
> Of course, the same things were happening in Ireland and Spain and the
> UK.
Ireland was a very rapidly developing economy at the time. Property
prices collapsed when the world economy stopped growing, and with it
the Irish economy, and a whole lot of property that could have been
useful to a rapidly growing economy became worthless.
Spain was building a lot to serve the tourist trade, but that's a
luxury industry - the global financial crisis meant that a lot people
decided not to go to Spain for their vacation, or put off buying a
vacation house there; again, the Spanish economy had been growing
rapidly - recovering from the after-effects of Franco's right-wing
nitwit economic policies and the global financial crisis hit them very
hard.
The U.K. did have a house property price bubble, as they'd also had
several times in the period when I was working there, and the global
financial crisis made sure that it burst. It wasn't anything like as
bad a the US version, and the consequences were less dramatic. The
Northern Rock Building Society was the famous casualty
http://en.wikipedia.org/wiki/Northern_Rock
but "In 2006 the bank (Northern Rock)had moved into sub-prime lending
via a deal with Lehman Brothers. Although the mortgages were sold
under Northern Rock's brand through intermediaries, the risk was being
underwritten by Lehman Brothers."
> Why do people think that rising house prices are a good thing?
The can borrow against the higher value of their houses ...
> >The Karl Rove approach to economic management - elect a Republican,
> >watch him wreck the economy, then criticise the Democrats for not
> >getting fast-enough recovery. The kind of strategy that can only
> >succeed if the electorate is as poorly informed as the right-wing
> >nitwit clowns who post here.
>
> Hardly anyone - the public, Congress, economists, certainly not the
> President - is thinking long-term. If you keep doing stuff that feels
> good now, but accumulated long-term damage, eventually things get
> worse.
But James Arthur's idea of thinking long term is to minimise debt at
the expense of everything else. Keynes pointed out that killing the
economy isn't a a great way to save it. Your Democratic administration
is doing what Keynesian pump-priming it can, but the Republican
majority in Congress really doesn't want the economy to actually
recover until after the presidential election.
As far as I can seen, you current administration is thinking long-
term, but - like all politicians - their primary interest is coping
with the situation as it is now, and that means dealing with a series
of short term problems, many of them created by the Tea Party.
--
Bill Sloman, Nijmegen