oldskeezy:No dumba$$ he's wrong, like you're wrong--as yes I have read and read Roubini, Ferguson, Tabbibi, etc etc almost daily. Go do yourself a favor and read some Schiff. I think you're the one who isnt reading them--or perhaps you are reading them and you simply dont get it. Again, go re-read my post--I was talking about the average person--I didnt say anything about the banks did I? No. There's a large percentage of this country (and around the world--Europe--West and East) that are in severe debt. What the economy needs in the long run is to not reinflate the Greenspan/Bernake bubble by offering $8K payoffs to take on overpriced homes and $4500 cash for junkers deal to put people further in debt, its to ELIMINATE that debt--so the economy can function properly. Economists call this a "debt jubillee" whereby debt is erased --ie by rewriting mortgages, renegotiating credit card loan balances, nationalizing banks that are insolvent, etc ect. Or absent this, people need to take the time to deleverage (ie--pay down debt)--pay off loans, credit cards, etc. Businesses as well need to do these things. Until these things are done the long term viability of the US economy will be in real danger of turning into what Japan has seen for the last 20 years--what is called a deflationary debt spiral. People had some much debt that they couldnt afford to live except by means of credit--so they needed to pay this credit off. before things could get better. Problem is only in the last few years have they really, slowly started to improve. Yes, banks are filled with liquid cash-by giving them 0% loans (at Taxpayer expense)--where they flip that money in microsecond trades but dont loan anything out--thats a short term fix. People need to get out of debt, even if that means the economy suffers--because if they dont get out of debt--they wont be able to service their debt when interest rates go through the roof when the rest of the world stops buying our t-bills at auction and they wont be able to afford $hit let along di*k. There's no such thing as spending your way out of the recession when your credit card balances are maxed out because citibank cut your credit line or increased your max payment, there's no spending your way out of a recession when your home which you've previously used as an ATM is $100,000 underwater and the credit line has dried up, there's no spending your way out of the recession when you've lost your job or your hours have been cut, theres no spending your way out of a recession when your 401K just took a massive $hit, there's no spending your way out of the recession when the bank wont give you a loan for anything, and there's certainly no way you're gonna by a $hitty Yes board cause some derelict who can huck a 720 told you so. SO yeah, start RE-reading your financial blogs guy. As I wave my hand --Abracadabra! Bam! You're still ignorant! Nice try though.
No dumba$$ he's wrong, like you're wrong--as yes I have read and read Roubini, Ferguson, Tabbibi, etc etc almost daily. Go do yourself a favor and read some Schiff. I think you're the one who isnt reading them--or perhaps you are reading them and you simply dont get it. Again, go re-read my post--I was talking about the average person--I didnt say anything about the banks did I? No. There's a large percentage of this country (and around the world--Europe--West and East) that are in severe debt. What the economy needs in the long run is to not reinflate the Greenspan/Bernake bubble by offering $8K payoffs to take on overpriced homes and $4500 cash for junkers deal to put people further in debt, its to ELIMINATE that debt--so the economy can function properly. Economists call this a "debt jubillee" whereby debt is erased --ie by rewriting mortgages, renegotiating credit card loan balances, nationalizing banks that are insolvent, etc ect. Or absent this, people need to take the time to deleverage (ie--pay down debt)--pay off loans, credit cards, etc. Businesses as well need to do these things. Until these things are done the long term viability of the US economy will be in real danger of turning into what Japan has seen for the last 20 years--what is called a deflationary debt spiral. People had some much debt that they couldnt afford to live except by means of credit--so they needed to pay this credit off. before things could get better. Problem is only in the last few years have they really, slowly started to improve. Yes, banks are filled with liquid cash-by giving them 0% loans (at Taxpayer expense)--where they flip that money in microsecond trades but dont loan anything out--thats a short term fix. People need to get out of debt, even if that means the economy suffers--because if they dont get out of debt--they wont be able to service their debt when interest rates go through the roof when the rest of the world stops buying our t-bills at auction and they wont be able to afford $hit let along di*k. There's no such thing as spending your way out of the recession when your credit card balances are maxed out because citibank cut your credit line or increased your max payment, there's no spending your way out of a recession when your home which you've previously used as an ATM is $100,000 underwater and the credit line has dried up, there's no spending your way out of the recession when you've lost your job or your hours have been cut, theres no spending your way out of a recession when your 401K just took a massive $hit, there's no spending your way out of the recession when the bank wont give you a loan for anything, and there's certainly no way you're gonna by a $hitty Yes board cause some derelict who can huck a 720 told you so.
SO yeah, start RE-reading your financial blogs guy. As I wave my hand --Abracadabra! Bam! You're still ignorant! Nice try though.
Since we're spouting second hand bullshit here, I'll steal a response from doc
[fartnoise]
Hey you can use copy and paste--that's great. Good for you.
I've learned my lesson here--discussing economics on this board is a complete waste of time as many people have yet to even take a class on it or know what the hell I am talking about.
I'll make sure I keep my posts on point from now on and discuss how that new board is gonna make me a better shredder, or how mismatched bindings are cool as hell, or what color my bandana/beanie combo is and if I should opt for the XXL tall tee or go real white boy gansta and get XXXL tall tee.
HAHHAHAHHA
moneygripp: oldskeezy: No dumba$$ he's wrong, like you're wrong--as yes I have read and read Roubini, Ferguson, Tabbibi, etc etc almost daily. Go do yourself a favor and read some Schiff. I think you're the one who isnt reading them--or perhaps you are reading them and you simply dont get it. Again, go re-read my post--I was talking about the average person--I didnt say anything about the banks did I? No. There's a large percentage of this country (and around the world--Europe--West and East) that are in severe debt. What the economy needs in the long run is to not reinflate the Greenspan/Bernake bubble by offering $8K payoffs to take on overpriced homes and $4500 cash for junkers deal to put people further in debt, its to ELIMINATE that debt--so the economy can function properly. Economists call this a "debt jubillee" whereby debt is erased --ie by rewriting mortgages, renegotiating credit card loan balances, nationalizing banks that are insolvent, etc ect. Or absent this, people need to take the time to deleverage (ie--pay down debt)--pay off loans, credit cards, etc. Businesses as well need to do these things. Until these things are done the long term viability of the US economy will be in real danger of turning into what Japan has seen for the last 20 years--what is called a deflationary debt spiral. People had some much debt that they couldnt afford to live except by means of credit--so they needed to pay this credit off. before things could get better. Problem is only in the last few years have they really, slowly started to improve. Yes, banks are filled with liquid cash-by giving them 0% loans (at Taxpayer expense)--where they flip that money in microsecond trades but dont loan anything out--thats a short term fix. People need to get out of debt, even if that means the economy suffers--because if they dont get out of debt--they wont be able to service their debt when interest rates go through the roof when the rest of the world stops buying our t-bills at auction and they wont be able to afford $hit let along di*k. There's no such thing as spending your way out of the recession when your credit card balances are maxed out because citibank cut your credit line or increased your max payment, there's no spending your way out of a recession when your home which you've previously used as an ATM is $100,000 underwater and the credit line has dried up, there's no spending your way out of the recession when you've lost your job or your hours have been cut, theres no spending your way out of a recession when your 401K just took a massive $hit, there's no spending your way out of the recession when the bank wont give you a loan for anything, and there's certainly no way you're gonna by a $hitty Yes board cause some derelict who can huck a 720 told you so. SO yeah, start RE-reading your financial blogs guy. As I wave my hand --Abracadabra! Bam! You're still ignorant! Nice try though. I was just hoping you could give me some insight into the evolution of the market economy in the early colonies. My contention is that prior to the Revolutionary War the economic modalities especially of the southern colonies could most aptly be characterized as agrarian precapitalist convinced that Virginia and Pennsylvania were strongly entrepreneurial capitalist back in 1740. Gordon Wood said about the pre-revolutionary utopia and the capital-forming effects of military mobilization. Wood drastically underestimates the impact of social distinctions predicated upon wealth, especially inherited wealth.
oldskeezy: No dumba$$ he's wrong, like you're wrong--as yes I have read and read Roubini, Ferguson, Tabbibi, etc etc almost daily. Go do yourself a favor and read some Schiff. I think you're the one who isnt reading them--or perhaps you are reading them and you simply dont get it. Again, go re-read my post--I was talking about the average person--I didnt say anything about the banks did I? No. There's a large percentage of this country (and around the world--Europe--West and East) that are in severe debt. What the economy needs in the long run is to not reinflate the Greenspan/Bernake bubble by offering $8K payoffs to take on overpriced homes and $4500 cash for junkers deal to put people further in debt, its to ELIMINATE that debt--so the economy can function properly. Economists call this a "debt jubillee" whereby debt is erased --ie by rewriting mortgages, renegotiating credit card loan balances, nationalizing banks that are insolvent, etc ect. Or absent this, people need to take the time to deleverage (ie--pay down debt)--pay off loans, credit cards, etc. Businesses as well need to do these things. Until these things are done the long term viability of the US economy will be in real danger of turning into what Japan has seen for the last 20 years--what is called a deflationary debt spiral. People had some much debt that they couldnt afford to live except by means of credit--so they needed to pay this credit off. before things could get better. Problem is only in the last few years have they really, slowly started to improve. Yes, banks are filled with liquid cash-by giving them 0% loans (at Taxpayer expense)--where they flip that money in microsecond trades but dont loan anything out--thats a short term fix. People need to get out of debt, even if that means the economy suffers--because if they dont get out of debt--they wont be able to service their debt when interest rates go through the roof when the rest of the world stops buying our t-bills at auction and they wont be able to afford $hit let along di*k. There's no such thing as spending your way out of the recession when your credit card balances are maxed out because citibank cut your credit line or increased your max payment, there's no spending your way out of a recession when your home which you've previously used as an ATM is $100,000 underwater and the credit line has dried up, there's no spending your way out of the recession when you've lost your job or your hours have been cut, theres no spending your way out of a recession when your 401K just took a massive $hit, there's no spending your way out of the recession when the bank wont give you a loan for anything, and there's certainly no way you're gonna by a $hitty Yes board cause some derelict who can huck a 720 told you so. SO yeah, start RE-reading your financial blogs guy. As I wave my hand --Abracadabra! Bam! You're still ignorant! Nice try though.
Do you have any idea how most people have been keeping up their standard of living since the 70's? No you dont, its called debt.
People have way too much of it. People no longer have homes to max out with equity lines of credit, people are losing jobs, people have had their credit card limits drawn down by banks and their interest rates increased.
People need to pay down their debt--look it up kid--its called deleveraging and it has to happen in order for the economy to grow into the future.
In the long term, people need to do this so that they can consume in the future--when you have too many bills--what do you do--keep buying-no, you pay off bills.
Look at what happened in Japan's lost decade--they tried to do what we're doing. Their stock market is 25% of what it was in 1991, a home purchased for the equivalent for $400K US in 1991 is worth $200K today--STILL!
If we dont want to repeat such things, we need to pay down the debt--not take on more as high sckrewl graduate RDM would have you believe.
So before you get on here and try and explain some economics you learned in high school econ 1--do a little reading--you wont sound so sophmoric.
If you listen what RDM is saying that all we need to do is simply ignore what is going on and keep spending and all will be fine--the crisis will abate. This is nonsense guy. He's living in a fantasy world--the same world that cut him from his team and will very likely assure him of a losing bet on his "YES" brand. It will be known in the footnotes of history as YES, we tried...... Thats why I originally wrote the piece. I guess just to illustrate how stupid he sounded.
Obviously, people need to spend money in order to live--they have to buy a lot of stuff--this will keep the economy going, but to keep buying a new board, bindings etc ect--what are known as disposable income items--this kind of stuff has to stop to some extent as people simply dont have the available cash ay more--or--they have much less. Case in point--I am trying to book a condo for our Utah party-several people have called me back on my ridiclously low offers for their condos--they're HURTING. Industries like snowboarding and other items that arent essential will take a hit--its a necessary fucntion. Disposable income expeditures must drop so that people can continue to live in their homes, apts, drive cars, ect. I never said that people ought to or even could stop spending money---but they certainly will and should cut back to pay off these bills. This is good for snowboarders with cash--its called deflation and is good for a short term period.
As for you claiming that if no one is spending then here comes the start of inflation because the law of supply and demand has been altered?
Yes, I think you took Econ 1 all right and you failed it--F+ perhaps? First off, if people arent spending money, then the demand for items goes down, and therefore the prices of those goods must also come down to reflect this. Only when people want something of a limited quantity do we get inflation---if people arent buying, prices drop--this is called DEFLATION guy, not inflation. Sorry --youve failed there. Go back and retry the question. And also, if something is a LAW--then by definition it cannot be altered. Can you alter the law of gravity? Can you alter the law of entropy? Hahahah No--on that one--another fail.
I'm stopping here---continuing the discussion with you is fruitless.
im.inc.:Here you go again. Getting pissed because people don't see things your way. what's that definition of sophmoric again.... Yes people need to pay off their dept I don't recall saying that people shouldn't. But where do you think that money comes from to pay off dept? Where does the money you make from you paycheck come from? Think about the flow of capital and where it comes from. If nobody is spending money nobody is making money. If a business has a drop in sales or no sales that means more lay offs. And it affects more than just the retail level of an industry. If more businesses fail because nobody is spending then guess what here comes the start of inflation because the law of supply and demand has been altered. But you keep talking like every single average american is up to thier eyeballs in dept. If I lost my job I have enough saved that I could live off of for the next 3 years and pay my mortgage and car payments etc, and not touch my 401k. It's called finacial planning. And trust me a lot of americans do this. Maybe you should try to understand that money doesn't just come from a bank or the governemnt or a loan from China in endless supply. Or people can just magically pay off their dept without the business that they work for generating revenue so they can have a job and income. And if you think that this is something that's taught in high school "econ 1" then you should already know this.
im.inc.:... But you keep talking like every single average american is up to thier eyeballs in dept. If I lost my job I have enough saved that I could live off of for the next 3 years and pay my mortgage and car payments etc, and not touch my 401k. It's called finacial planning. And trust me a lot of americans do this. ....
Snurf: im.inc.:... But you keep talking like every single average american is up to thier eyeballs in dept. If I lost my job I have enough saved that I could live off of for the next 3 years and pay my mortgage and car payments etc, and not touch my 401k. It's called finacial planning. And trust me a lot of americans do this. .... No, I'm not going to trust you on this as your assertions are contrary to what most economists and financial planners have been saying. This may not be the most authoritative source but it illustrates what has been happening with U.S. savings rates and personal debt. http://www.billshrink.com/blog/personal-savings-rate/ There has been some change recently as the trends show, once some people realized how much in debt they were. However we, as a society, still have a long way to go to live within our means.
drjcv:...more and bigger and better everything fueled by mans own instincts and the glamorization of wealth...
drjcv:... i don't think wanting to be in a position to buy my daughter a brand new, sensible car when she turns 16 is materialistic, i look at it as looking out for her best interests. i overconsume snowboarding related products ( i have several "kits" including goggles gloves etc and a quiver of boards, but i am not driven to consume in the other area of my life) but i have a normal 5 year old vehicle (not an escalade) and an average house
drjcv:debt is at an all time high, and savings is at an all time low. this has been planned by the people who run the system for a long time, most people are merely debt slaves and this cycle needs to stop. part of the problem is conspicuous consumption (more and bigger and better everything fueled by mans own instincts and the glamorization of wealth) but the bigger issue is that spending is enabled by the financial system.
And this was my point and lies in direct contradiction to RDM's simplistic assertion that all people have to do is simply start spending again and we'll be all fine and dandy. In order for the system to function long term, people--especially in the US need to consume FAR FAR less and save more. Otherwise we'll continute to run huge current accoutn deficts and our currency will continue its downward slide into $hitdom.