Validuz, I am curious what would have Ron Paul done during the Great Recession 2008? by Ender - Page 2 - TribalWar Forums
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TooSmoothe
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Old
21 - 01-26-2010, 11:23
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Quote:
Originally Posted by Ender View Post
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
 
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samUwell
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Old
22 - 01-26-2010, 11:32
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Originally Posted by Ender View Post
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.
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?

if the libertarians were in power and they did nothing like you are suggesting, the results would have allowed for these mega bank to collapse, creating a bunch of smaller banks which, unless i am mistaken, is something Obama is proposing right now.

Quote:
WSJ

The contradictory statements emerging from Whitehall illustrate how much of a shock President Obama***8217;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.
this is a 6 point plan on ending the federal reserve that just came out the other day from the Ludwig Von Misses Institute.

Quote:
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 ***8220;too big to fail,***8221; as well limiting their ability to invest in what the president referred to as investments that are ***8220;too risky.***8221;

Two important questions immediately come to mind: First, when is a bank ***8220;too big***8221; to be too big to fail? And, second, when is an investment ***8220;too risky***8221; 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.
[.....]
and that is a great question to be asking...when and what causes something to become "too big to fail?"
 
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carouselambra
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Old
23 - 01-26-2010, 11:34
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Ron Paul obviously would have hyperinflated and flooded the economy with gold then be as efficient as possible
 
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Ender
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Old
24 - 01-26-2010, 12:48
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I'll get serious in this thread soon. Continue discussion.
 
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Ianboo
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25 - 01-26-2010, 13:02
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Quote:
Originally Posted by Ender View Post
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.
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.
 
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Last edited by Ianboo; 01-26-2010 at 13:06..
samUwell
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26 - 01-26-2010, 13:04
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i dont know how many of you have watched this Frontline program but its well worth it.

Breaking the Bank: Frontline
 
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Rev. Zen
VeteranXV
Old
27 - 01-26-2010, 13:22
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Quote:
Originally Posted by CarpeIppon View Post
The libertarian solution would be to get the same result, but spend 3 trillion less dollars getting there.
:nail-on-the-head:
 
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ScooBySnaCk
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Old
28 - 01-26-2010, 13:25
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1. Ron Paul is a Doctor and does not have herpes
2. see 1
 
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Data
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Old
29 - 01-26-2010, 13:28
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Ender has herpes.

This invalidates any argument Ender might put forth.
 
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TheAnk
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30 - 01-26-2010, 13:39
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Ender
ValtreX
Old
31 - 01-26-2010, 14:23
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Quote:
Originally Posted by Ianboo View Post
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.
This isn't about short term thinkers.

What you're describing is the Greenspan 'put', which is when Greenspan lowered the interest rates during the Asian financial crisis, it let people know that Greenspan wasn't going to let the stock market go down, allowing only upside risk.

Yes.. This is a risk. A small one. I wouldn't say that's a reason to get rid of government intervention. Look at this way, many describe what Hamilton did during the crisis in the 1780's much like what Bernanke did today. There wasn't another recession after hamilton "bailed out" the banks until over 30-40 years later and it was for other reasons, so to suggest that just because the fed or government intervenes on a crisis, doesn't mean people are only looking at the upside risk.

I do agree that Greenspan lowered the interest rates too low, that it fueled the housing market, I think we're learning a lot of lessons from this recession. I hope Bernanke starts to raise interest rates more, to prevent another bubble.
Had the Fed done nothing, and let the banks fail, we would be in another great depression. The inter-bank lending was at an all time high for interest rate, meaning banks were scared to lend to eachother, meaning credit wasn't flowing.

Letting the banks fail is funny. Try again.

As far as the auto industry, I didn't think they needed a bail out, nor did the fed. This was purely a congressional and fiscal move.
 
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Last edited by Ender; 01-26-2010 at 14:30..
Ender
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32 - 01-26-2010, 14:25
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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.
 
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DrMeithos
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33 - 01-26-2010, 14:31
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Quote:
Originally Posted by Ender View Post
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?
 
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Ender
ValtreX
Old
34 - 01-26-2010, 14:34
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Quote:
Originally Posted by DrMeithos View Post
Wasn't it regulation that forced the banks to take subprime loans?
No.

It was encouraged to provide lending to lower incomes. It was never "regulation".

It wasn't the fact that banks provided sub prime, banks knew when they repackaged it, it was a huge financial instrument to generate high returns.

They innovation from the banks came to find loop holes around current regulation. Sub prime loans wasn't seen as a problem until they finally figured out what was being done with them and how much of them were taken on by the banks. s
 
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Last edited by Ender; 01-26-2010 at 14:37..
Gandalf
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Old
35 - 01-26-2010, 14:36
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Quote:
Originally Posted by DrMeithos View Post
Wasn't it regulation that forced the banks to take subprime loans?
Don't interject reality into TW, it only confuses the sheep.
 
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Ender
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36 - 01-26-2010, 14:38
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I need to find a forum that I can debate Economics with. Anyone know a good forum? The inbred on Tribal War is getting old.
 
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KnightMare
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37 - 01-26-2010, 14:41
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Quote:
Originally Posted by DrMeithos View Post
Wasn't it regulation that forced the banks to take subprime loans?
you mean the same regulations that have been chipped away at since the 30s?
 
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samUwell
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Old
38 - 01-26-2010, 14:42
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Forums - The Mises Community

have fun. keep an open mind though.
 
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KnightMare
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39 - 01-26-2010, 14:55
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btw its pretty funny how canadian banks werent affected much by these scams. Damn gov regulation!
 
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LGBR
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40 - 01-26-2010, 15:03
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ender is seriously retarded

and ianboo, just to clarify: Ford never took a bailout. they've been surviving off their cash reserves (aka good business practice) just like you'd expect any responsibly run business to operate.

what would the libertarians done? probably let the banks fail. Who cares? in the long run, smaller banks would have popped up damn near immediately to pick up the slack and make the money (which is, as already stated, what obama is doing right now after realizing he made a bad choice)

but i mean i guess if you're dumb enough to get herpes and think Hawaii is a good school, is good enough for your ****ty professors
 
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