The free market (1 Viewer)

[Garygaz]

oh i thought they got the capital from other larger banks, could be wrong though, and even then i'm pretty sure they lent out on credit lines of their own.

i would say it'd be more the lack of policy/regulation that led to poor people getting loans rather than the existence of it.

 

[boris]

compare the australian system to the us one

who collapsed and who didnt

 

[Garygaz]

yes, but what is your point?

 

[Garygaz]

we would still be in negative growth if it wasn't for resources tbh, sorta saved us for the last 5 years.

 

[scuba_steve2121]

oh i thought they got the capital from other larger banks, could be wrong though, and even then i'm pretty sure they lent out on credit lines of their own.

i would say it'd be more the lack of policy/regulation that led to poor people getting loans rather than the existence of it.

it was a policy they put in speciifcaly to allow poor people to get loans when they shouldn't of been able to.

fed creates the credit boom, money is cheap (low interest rates), of course inflation spikes up due to the expanding money supply, this forces people to invest (or give out loans) because otherwise, its money that is sitting there devauling by the day. and of course it all goes to shit when the fed finally decides to raise interest rates to combat the inflation and the mal-investment appears (bad loans)

and god dam it you made me explain the bussines cycle again, UGH you happy now?

 

[boris]

yes, but what is your point?

it shows what the weaknesses in the us system are, that contributed to the gfc (in addition to the fed etc)

we would still be in negative growth if it wasn't for resources tbh, sorta saved us for the last 5 years.

that is all hypothetical,
if we didnt have the resource boom then perhaps other industries would have come to the forefront over the past 10yrs
we dont know and its silly to speculate

 

[scuba_steve2121]

 

[Garygaz]

it was a policy they put in speciifcaly to allow poor people to get loans when they shouldn't of been able to.

fed creates the credit boom, money is cheap (low interest rates), of course inflation spikes up due to the expanding money supply, this forces people to invest (or give out loans) because otherwise, its money that is sitting there devauling by the day. and of course it all goes to shit when the fed finally decides to raise interest rates to combat the inflation and the mal-investment appears (bad loans)

and god dam it you made me explain the bussines cycle again, UGH you happy now?

lol m8

all i'm saying is that as far as i knew it was the lack of regulation that allowed poor cunts with shit jobs to get loans rather than an actual piece of legislation allowing for specific lending standards.

also your argument on the fed, it presupposes that you can blame the fed for the lending practices of certain corporations? i mean yes, i agree when there is inflation people look to more aggressively invest but do you say that the creation of inflation by issuing cheap credit gives all accountability to the fed?

 

[cosmo kramer]

who was the person all the libertarians here started copying anyway

 

[scuba_steve2121]

lol m8

all i'm saying is that as far as i knew it was the lack of regulation that allowed poor cunts with shit jobs to get loans rather than an actual piece of legislation allowing for specific lending standards.

also your argument on the fed, it presupposes that you can blame the fed for the lending practices of certain corporations? i mean yes, i agree when there is inflation people look to more aggressively invest but do you say that the creation of inflation by issuing cheap credit gives all accountability to the fed?

well when you have a third party like the fed messing up price signals and causing a series of bubbles, yea you can blame the fed. there would not of been an 07 crash without the fed.

what should of happened when everything went ape shit in 2007, was one year or a year and a half of misery, as markets reallocated capital and labour, than the boom would of started up again so in another 10 years time we could have another collapse. however stimulus spending has prolonged the collapse and now we are in a situation where no amount of money can prolong it anymore, we are in heading towards if not already in stagflation lol.

governments need to stop spending, let market fall flat on its face, raise interest rates, and now have what will probably be 3 years of mess for the markets to clean up instead of 1.

yes it is going to get ALOT worse before it gets better

 

[Garygaz]

i swar dat test said i was a neo-con it cant be wrong

 

[scuba_steve2121]

who was the person all the libertarians here started copying anyway

sylvestor and blastus were already here when i got here, so idk? its just us three who are really libertarian anyways

 

[cosmo kramer]

we're talking about austrian school economics on SoN right now

 

[Garygaz]

well when you have a third party like the fed messing up price signals and causing a series of bubbles, yea you can blame the fed. there would not of been an 07 crash without the fed.

what should of happened when everything went ape shit in 2007, was one year or a year and a half of misery, as markets reallocated capital and labour, than the boom would of started up again so in another 10 years time we could have another collapse. however stimulus spending has prolonged the collapse and now we are in a situation where no amount of money can prolong it anymore, we are in heading towards if not already in stagflation lol.

governments need to stop spending, let market fall flat on its face, raise interest rates, and now have what will probably be 3 years of mess for the markets to clean up instead of 1.

yes it is going to get ALOT worse before it gets better

i dunno about your statement that no housing bubble would have occurred without the fed. it was just a ponzi scheme perpetuated by the failings in lending standards, the joke that is the ratings agencies and financial managers who were buying products they didn't understand. the fed may have played a part, but you can't say it wouldn't have happened without them. they weren't responsible for the credit lending practices, they weren't responsible for the collateralization of junk debt into AAA rated packages, they weren't responsible for the failings of the credit ratings agencies.

 

[Garygaz]

we're talking about austrian school economics on SoN right now

what's SoN

 

[cosmo kramer]

what's SoN

shadows of nothing

it's a community site that ive been at for the past 8 years

it only has about 15 or so active members left

 

[scuba_steve2121]

i dunno about your statement that no housing bubble would have occurred without the fed. it was just a ponzi scheme perpetuated by the failings in lending standards, the joke that is the ratings agencies and financial managers who were buying products they didn't understand. the fed may have played a part, but you can't say it wouldn't have happened without them. they weren't responsible for the credit lending practices, they weren't responsible for the collateralization of junk debt into AAA rated packages, they weren't responsible for the failings of the credit ratings agencies.

k well there is no getting through to you, so I'm just gonna take some good advice i once heard and leave it, or else I'm just gonna start typing excessive profanities, good day to you sir

 

[Garygaz]

k well there is no getting through to you, so I'm just gonna take some good advice i once heard and leave it, or else I'm just gonna start typing excessive profanities, good day to you sir

ahgahaha m8

ron paul 5eva

so you acknowledge that the dipping of interest rates and then the subsequent raising of them again was one of the main reasons for the crash, but then you seem to smack your head into dirt when it comes to acknowledging any of the other events that attributed to what happened?

if the lenders had practiced prudent lending practices then the increase in interest rates would not have had the same ramifications!?!?!?! fed responsible for the practices of private enterprise? m8, everything is simple with hindsight.

 

[Garygaz]

you're essentially saying that the fed should expect that their monetary policy would lead to fraudulent practice. okay.

 

[Garygaz]

seriously, i don't know what you're arguing. it's not economics:

when entity a) partakes in an action which entity b) abuses, a) attempts to rectify problem and the result of b)'s previous actions leads to serious ramifications. without entity b) abusing the situation in the first place a)'s attempts to rectify the problem would have had a negligible ill effect.