TooSmoothe
Veteran XX
Lol,
Secondly, Hawaii has a great Economics department for UG compared to schools like Oregon/Oregon state, etc etc.
pwnd
Funniest thing I have read today, thank you
Lol,
Secondly, Hawaii has a great Economics department for UG compared to schools like Oregon/Oregon state, etc etc.
pwnd
wait so, you want to know what a libertarian would have done but you are already assuming what would have happened and you also know the outcome/results?How would you get the same result?
I am pretty sure the libertarian solution would have been to do nothing at all, which by the way, would have been disastrous.
WSJ
The contradictory statements emerging from Whitehall illustrate how much of a shock President Obama’s dramatic announcement on bank reform was to the British government. Obama proposes to break up the megabanks and put limits on the size of institutions and their trading activities. This was a U-turn by the administration and is not at all in line with what the British government wants.
Real Banking Reform? End the Federal Reserve by Richard M. Ebeling
President Obama announced on January 21 that he will push for legislation that would significantly limit the size of banks to make sure that they are not “too big to fail,” as well limiting their ability to invest in what the president referred to as investments that are “too risky.”
Two important questions immediately come to mind: First, when is a bank “too big” to be too big to fail? And, second, when is an investment “too risky” and who is to make that judgment call?
The fact is, the answers to both questions will end up being decided by politicians who sign off on the regulatory legislation and by bureaucrats who will have the discretionary power to implement the new guidelines.
[.....]
How would you get the same result?
I am pretty sure the libertarian solution would have been to do nothing at all, which by the way, would have been disastrous.
The libertarian solution would be to get the same result, but spend 3 trillion less dollars getting there.
If by "disastrous" you mean painful in the short term I agree with you.
What you fail to comprehend is the long term (5-30 year) positive effect of letting the mega banks fail hard. This applies to GM, Ford, and Chrysler as well, they have unsustainable business models, terrible products, they should have been allowed to sink or swim on their own.
Imagine a game of cards with strict rules for how to win and lose, now imagine if the dealer can randomly choose to help a player who is doing poorly with a better hand now and then. How much confidence do you think people playing the game or even people observing the game would have in the stability of the sport as a whole? They could never be sure if a player is doing good because of actual skill or if the dealer was keeping him in the game past his actual talent level. Anyone betting on such a player might be in store for a world of trouble when the winds shift.
This is essentially what the government is doing to the economy each time a business gets a massive influx of cash. The "rules" of success and failure get blurred and people don't know how to react, it breeds mistrust of the whole system and kills consumer confidence.
If the banks and auto companies had just been ignored there might have been some pretty epic financial collapses around the nation and it would have stung quite a bit, but the world economy is a lot more resilient than people give it credit for. Ron Paul's approach of essentially doing nothing is the only logical idea I've seen come out of Washington DC in years.
Short term thinkers will never understand why this is true no matter how many silly card game analogies I can come up with. Not sure why I bother.
It's funny because libertarians would argue small government and no regulation. Had that happen we wouldn't have a United States today.
The 2008 recession is reminded proof that free markets need government regulation.
Wasn't it regulation that forced the banks to take subprime loans?
Wasn't it regulation that forced the banks to take subprime loans?
Wasn't it regulation that forced the banks to take subprime loans?