NationStates Jolt Archive

Funny how the press seems to decide that in every election year that Republican is running for reelection.

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future. No matter who is President. Clinton got credit that anyone with a brain knows was the result of being forced to sign reforms by the Republican congress, it just amazes me how no one seems to comment on the press campaign to hurt the economy in favor of a DNC victory. 2004 was particularly sickening. It almost made me decide to vote out of spite.

Has there ever been an election year since the formation of the republican party in which a republican did not run for president?

Has there ever been an election year since the formation of the republican party in which a republican did not run for president?

Did you notice how I said reelection? As in they would be hurt by the insinuations or is that too much to ask?

Suddenly?

No.

Btw, A Republican is not running for reelection this year.

Funny how the press seems to decide that in every election year that Republican is running for reelection.

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future. No matter who is President. Clinton got credit that anyone with a brain knows was the result of being forced to sign reforms by the Republican congress, it just amazes me how no one seems to comment on the press campaign to hurt the economy in favor of a DNC victory. 2004 was particularly sickening. It almost made me decide to vote out of spite.Funny how the media is reporting that the stock markets aren't doing well when they actually aren't doing well...

*Shakes head*

Forgive me for not going into depth.

Whenever a Republican administration is going to suffer from the allegations that the economy is bad. Don't be a weasel and make a 10 page thread on that.

1988, 2004 which didn't exactly have much difference between the years before and after, yet the economy was always so terrible.

It's only March, by September, it will the be the worst economy in history.

Funny how the media is reporting that the stock markets aren't doing well when they actually aren't doing well...

Yeah, because it's not like the stock market has always been up and down from day to day or anything.

For real though, I haven't heard much about how terrible the economy is, not even in the 2006 election, though I wasn't a bit surprised that it is daily news now with the polls coming out.

Yeah, because it's not like the stock market has always been up and down from day to day or anything.If you paid attention, you'd notice there's a crisis going on because the stockbrokers fear there will be a downward trend. It would take some serious delusion, ignorance, or intellectual dishonesty to deny that the stock markets, along with the economy, are currently not doing well.
For real though, I haven't heard much about how terrible the economy is, not even in the 2006 election, though I wasn't a bit surprised that it is daily news now with the polls coming out.Maybe because the big collapse of the housing market only happened last year.

What do you mean 'suddenly'?

Did you notice how I said reelection?

No.

What do you mean 'suddenly'?

Apparently he means he's been in a cave for the last three months.

Seriously, we need to encourage saving again. And you know what? The FairTax would do just that.

Are you seriously expecting competence from politicians now?

If you paid attention, you'd notice there's a crisis going on because the stockbrokers fear there will be a downward trend. It would take some serious delusion, ignorance, or intellectual dishonesty to deny that the stock markets, along with the economy, are currently not doing well.
Maybe because the big collapse of the housing market only happened last year.
There are problems with the economy. There's too much debt. Lenders lent way too much money to people that don't understand debt. Those people have just quit paying the bills. But increased debt is the real problem.

That's why I wonder what the Fed is thinking when it lowers the interest rates. Isn't that making it easier to borrow money? Isn't that the problem that got us here, to begin with?

Same thing with the handouts. We really don't need more money in the economy. We've been borrowing enough and putting it right back into circulation. Borrow, then buy. Isn't that how to fight a recession?

Seriously, we need to encourage saving again. And you know what? The FairTax would do just that.

It almost made me decide to vote out of spite.
Heaven forbid you should exercise your citizen's duty to vote!

Also, proof of claims?

There are problems with the economy. There's too much debt. Lenders lent way too much money to people that don't understand debt. Those people have just quit paying the bills. But increased debt is the real problem.

That's why I wonder what the Fed is thinking when it lowers the interest rates. Isn't that making it easier to borrow money? Isn't that the problem that got us here, to begin with?

Same thing with the handouts. We really don't need more money in the economy. We've been borrowing enough and putting it right back into circulation. Borrow, then buy. Isn't that how to fight a recession?

Seriously, we need to encourage saving again. And you know what? The FairTax would do just that.No need to turn this into an economic debate when we can all point and laugh at Eric for failing to grasp the situation. Though, unless I am very much mistaken, encouraging people to save is poison for the American economy, seeing as it lives off of and grows through consumption.

Heaven forbid you should exercise your citizen's duty to vote!I seriously wouldn't mind if he didn't, considering his views.

No need to turn this into an economic debate when we can all point and laugh at Eric for failing to grasp the situation. Though, unless I am very much mistaken, encouraging people to save is poison for the American economy, seeing as it lives off of and grows through consumption.
Okay... Ha Ha...

But there are still some very good reasons why we should have money in the bank and not as a debit on our credit card statements.

Are you seriously expecting competence from politicians now?
Every so often, I let my guard down and hope for a Congress that can actually solve more problems than it creates.

Okay, I'm over that now.

No need to turn this into an economic debate when we can all point and laugh at Eric for failing to grasp the situation. Though, unless I am very much mistaken, encouraging people to save is poison for the American economy, seeing as it lives off of and grows through consumption.

If people owe so much that they are paying all of their money on loans then the consumption is less, no?

Every so often, I let my guard down and hope for a Congress that can actually solve more problems than it creates.

Okay, I'm over that now.

That's good. Way I figure it, our entire economy is based on massive amounts of debt, and one of these days that'll come home to roost. When it does we're fucked in a big way.

Ought be fun.

Okay... Ha Ha...

But there are still some very good reasons why we should have money in the bank and not as a debit on our credit card statements.

I can agree with you in principle there, but as demonstrated by people who have mastery over economic understanding far more than I do, the Fair Tax plan would simply screw things over even worse. The money has to go to the right people, after all, and the right people would be those who don't have anywhere near as much.

That's why a progressive income tax system is actually pretty fair. All it really does is ask those who have more money to shoulder a bit more of the tax burden we all share for the sake of the whole. Basically, we just ask them to take a bit more responsibility since they're the ones who can easily afford it. Is that really a bad thing?

There are problems with the economy. There's too much debt. Lenders lent way too much money to people that don't understand debt. Those people have just quit paying the bills. But increased debt is the real problem.

That's why I wonder what the Fed is thinking when it lowers the interest rates. Isn't that making it easier to borrow money? Isn't that the problem that got us here, to begin with?

Same thing with the handouts. We really don't need more money in the economy. We've been borrowing enough and putting it right back into circulation. Borrow, then buy. Isn't that how to fight a recession?

Seriously, we need to encourage saving again. And you know what? The FairTax would do just that.

The problem is that now there is a lack of credit because everyone is afraid to lend in case businesses collapse. So the Fed has cut rates to get banks and businesses lending again.

I don't think the volume of debt was the problem - at least not for businesses, household debt is far too high in the US and even worse here in the UK - but the lack of regulation of credit markets which led to businesses buying into debt instruments that were so complex they couldn't fathom them - all they had was a guarantee from the lenders and the ratings agencies that there was very little risk, which we now know is rubbish. Credit markets need to be regulated similarly to other financial markets.

Funny how the press seems to decide that in every election year that Republican is running for reelection.

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future. No matter who is President. Clinton got credit that anyone with a brain knows was the result of being forced to sign reforms by the Republican congress, it just amazes me how no one seems to comment on the press campaign to hurt the economy in favor of a DNC victory. 2004 was particularly sickening. It almost made me decide to vote out of spite.

It is all a vast left-wing conspiracy. :rolleyes:

That's why even George W. Bush is acknowledging the economy has clearly slowed down. link (http://money.cnn.com/2008/03/07/news/economy/bush_econ/index.htm?cnn=yes) :headbang:

The FairTax would do just that.

Not this again. :rolleyes:

Okay... Ha Ha...

But there are still some very good reasons why we should have money in the bank and not as a debit on our credit card statements.I agree :)
If people owe so much that they are paying all of their money on loans then the consumption is less, no?Not if they take up new loans. Note that eventually this will all come crashing down, as it currently is with the housing market, as it is not a sustainable economic practice.
Not this again. :rolleyes:I agree :)

Is the OP seriously questioning why the media would report on a bad economy when there's a bad economy? It's beyond stupidity to suggest that this is just a ploy when the president himself admits (http://money.cnn.com/2008/03/07/news/economy/bush_econ/index.htm?cnn=yes)the economy is slowing. The SPX is at its lowest point in the last 18 months, unemployment is on a rise, we're on the verge of a recession, and the price of oil is at a historic high.

here's a thought, maybe they're reporting on a bad economy because the economy is bad.

Maybe it often comes out during republican administrations because republican leaders have been generally inept at solving economic problems.

Yes, that's how these things work. Very rarely do recessions occur gradually; if they did, it would be easy for central banks to stop them. Virtually every time it's been some kind of sudden shock that caused the economy to suddenly cave in on itself and fall in to recession. So, there's hardly anything unexpected about this; we've had a seven year expansion and it's due time for another recession.

Just to poke a stick in the idea, doesn't mass opinion kind of drive an economy one way or the other? If the MSM says there is a recession, doesn't it make sense that statement will exaggerate the reaction?

Yes, that's how it typically works. Recessions are first and foremost a confidence trap.

I can agree with you in principle there, but as demonstrated by people who have mastery over economic understanding far more than I do, the Fair Tax plan would simply screw things over even worse. The money has to go to the right people, after all, and the right people would be those who don't have anywhere near as much.

That's why a progressive income tax system is actually pretty fair. All it really does is ask those who have more money to shoulder a bit more of the tax burden we all share for the sake of the whole. Basically, we just ask them to take a bit more responsibility since they're the ones who can easily afford it. Is that really a bad thing?
The problem with ANY income tax scheme is that all the spenders need to do is raise the rates, change the brackets, and tax us more, if they want to spend more of our money. Good, bad, indifferent, there are still no constraints on how Congress uses our money to buy votes.

What would be even better than the FairTax, would be a restraint on spending. I've said 10 percent of the GDP is a good number. Maybe 8, maybe 15, but let's establish some bounds on what can be spent. Huge deficits and inflation are even worse than high taxation.

Is the OP seriously questioning why the media would report on a bad economy when there's a bad economy?
Just to poke a stick in the idea, doesn't mass opinion kind of drive an economy one way or the other? If the MSM says there is a recession, doesn't it make sense that statement will exaggerate the reaction?

Just to poke a stick in the idea, doesn't mass opinion kind of drive an economy one way or the other? If the MSM says there is a recession, doesn't it make sense that statement will exaggerate the reaction?Yes, but the alternative would be the media lying and everyone being surprised and then the situation being exaggerated even more in the ensuing panic.

Yes, that's how these things work. Very rarely do recessions occur gradually; if they did, it would be easy for central banks to stop them. Virtually every time it's been some kind of sudden shock that caused the economy to suddenly cave in on itself and fall in to recession. So, there's hardly anything unexpected about this; we've had a seven year expansion and it's due time for another recession.
I'm going to disagree a little. There are usually a number of months where economists try to figure out if we're actually in a recession or not. Apparently the old gouge of counting declining quarters isn't good enough, so they hem and haw and then finally say, "Yes, we are in a recession that started in December '07." And this is no different. Debt builds, housing prices/starts are in the tank, manufacturing is off, employment is down, but it's hard to tell because so much this time of year is seasonal...Recession, yes? Or no? There is never a watershed event that signals a recession.

No, there's always some room between the two extremes. But bad news sells, so that's what we'll hear.No, you see if worst comes to worst and it really is a recession, the damage will far outweigh the benefit of having skid over a few bumps unnoticed. If saying an economy was doing well worked, then the Soviet Union would never have collapsed.

The problem with ANY income tax scheme is that all the spenders need to do is raise the rates, change the brackets, and tax us more, if they want to spend more of our money. Good, bad, indifferent, there are still no constraints on how Congress uses our money to buy votes.

What would be even better than the FairTax, would be a restraint on spending. I've said 10 percent of the GDP is a good number. Maybe 8, maybe 15, but let's establish some bounds on what can be spent. Huge deficits and inflation are even worse than high taxation.

Now that's something that I can, again, agree with in principle.

Yes, but the alternative would be the media lying and everyone being surprised and then the situation being exaggerated even more in the ensuing panic.

No, there's always some room between the two extremes. But bad news sells, so that's what we'll hear.

There are problems with the economy. There's too much debt. Lenders lent way too much money to people that don't understand debt. Those people have just quit paying the bills. But increased debt is the real problem.

That's why I wonder what the Fed is thinking when it lowers the interest rates. Isn't that making it easier to borrow money? Isn't that the problem that got us here, to begin with?

Same thing with the handouts. We really don't need more money in the economy. We've been borrowing enough and putting it right back into circulation. Borrow, then buy. Isn't that how to fight a recession?

Seriously, we need to encourage saving again. And you know what? The FairTax would do just that.

Is there any economic situation you can think of that a Fair Tax won't help?

Is there any economic situation you can think of that a Fair Tax won't help?
No. I realize it is the panacea that we need. But there are too many non-believers here to make the case again. I'll save my carpal tunnels to evangelize in more productive areas.

Is there any economic situation you can think of that a Fair Tax won't help?

a real one?



:p the joke was there. I had to do it.

There was a study about the top reason stock brokers weren't buying and the top reason turned out to be fear of a Democratic president.

There was a study about the top reason stock brokers weren't buying and the top reason turned out to be fear of a Democratic president.

no there wasn't

There was a study about the top reason stock brokers weren't buying and the top reason turned out to be fear of a Democratic president.


I looked for this study you were talking about and could only find:
http://money.cnn.com/2004/01/21/markets/election_demsvreps/
"stocks rise more and volatility dips under Democrats."

Just to poke a stick in the idea, doesn't mass opinion kind of drive an economy one way or the other? If the MSM says there is a recession, doesn't it make sense that statement will exaggerate the reaction?

That's exactly what I'm saying. All of a sudden, the press starts saying that economy, which hasn't made any kind of drastic change in a long time is terrible. And of course asking the President about it is going to have him stating the obvious, then they report it like it's huge news. What impact exactly does Bush or any President have on the economy? I just never understood how a President gets so much credit or blame for economy that Congress creates.

It's just funny how this always happens at the beginning of an election year when a Republican occupies the White House and yet no one ever starts questioning it.

Or is this like when the DNC kept talking about how you had to elect John Kerry because of his four months in Vietnam and no one has the ability to remember it?

Does anyone else remember the 2004 campaign when high ranking democrats were on every news station talking about how terrible the economy is and how it's not going to get better and basically doing everything could to bring that about so that they could win any election? It was despicable.

there hasn't been any drastic changes in the economy in a long time?

tell me what oil was per barrel when Bush took office and tell me what it is now.

have you heard about the housing market crash?

seriously man... which conservative rag do you get your news from?

What exactly hasn't gone up in price since 2000? I'd like to hear that. And are leftists actually complaining about gas prices? If they had their way, we'd be paying 10x as much, like the Europeans.

And the so-called housing market crisis is bs. It wasn't that long ago when Bush was President that home ownership was at the highest point ever, this is a bullshit problem and neither the good nor the bad had anything to do with Bush. As incompetent as he is, blaming him or any political party for the so-called housing market collapse is as ridiculous as giving them credit for home ownership.

Yeah, not like that would have anything to do with the election talk.

There has been talk of a recession since last August. Haven't you noticed? A massive lack of liquidity, banks forced to write down billions of dollars worth of assets, falling house prices, slow job creation... does any of this ring a bell?

What does any of that have to do with Bush or what exactly would have changed that?

Higher taxes is the only difference between the Republicans and the Democrats when it comes to the economy.

What exactly hasn't gone up in price since 2000? I'd like to hear that. And are leftists actually complaining about gas prices? If they had their way, we'd be paying 10x as much, like the Europeans.

And the so-called housing market crisis is bs. It wasn't that long ago when Bush was President that home ownership was at the highest point ever, this is a bullshit problem and neither the good nor the bad had anything to do with Bush. As incompetent as he is, blaming him or any political party for the so-called housing market collapse is as ridiculous as giving them credit for home ownership.

Do you have a severe allergy to reality?

Employers Slash the Most Jobs in 5 Years (http://news.lp.findlaw.com/ap/f/1311//03-07-2008/20080307115005_06.html)
By JEANNINE AVERSA AP Economics Writer

WASHINGTON (AP) - Employers slashed 63,000 jobs in February, the most in five years and the starkest sign yet that the country is heading dangerously toward recession or is in one already.

The Labor Department's report, released Friday, also indicated that the nation's unemployment rate dipped from 4.9 percent in January to 4.8 percent last month as hundreds of thousands of people - perhaps discouraged by their prospects - left the civilian labor force.
....

Apparently, Bush's Labor Department is part of the media conspiracy. :rolleyes:

The US economy looks pretty bad. Average home equity below 50% for the first time since 1945. Predictions of dozens, if not hundreds, of bank failures. Declining real estate prices expected to last for another year or two.

The weak US dollar played a role, to be sure, but I'm not sure I'd pin this one on the US government. Those steel tariffs were stupid, sure, and the invasion of Iraq drove up oil prices (as did the falling dollar, which appears to have been intentional), but the collapse of the housing market was all the fault of imprudent consumers.

That's exactly what I'm saying. All of a sudden, the press starts saying that economy, which hasn't made any kind of drastic change in a long time is terrible.

There has been talk of a recession since last August. Haven't you noticed? A massive lack of liquidity, banks forced to write down billions of dollars worth of assets, falling house prices, slow job creation... does any of this ring a bell?

What exactly hasn't gone up in price since 2000? I'd like to hear that. And are leftists actually complaining about gas prices? If they had their way, we'd be paying 10x as much, like the Europeans.

And the so-called housing market crisis is bs. It wasn't that long ago when Bush was President that home ownership was at the highest point ever, this is a bullshit problem and neither the good nor the bad had anything to do with Bush. As incompetent as he is, blaming him or any political party for the so-called housing market collapse is as ridiculous as giving them credit for home ownership.

answer the question about the price of oil per barell

no, you aren't interested in an honest debate are you?

I'll tell you

when Bush took office - oil was $30/barell

now it's over $100/barell

the housing market crisis is BS? is that why so many mortgage lenders declared bankruptcy and went out of business? is that why banks are refusing credit to each other? it's all because the liberal media said there is an economic slowdown? The chairman of the federal reserve is lying? really?

Do you have a severe allergy to reality?

Employers Slash the Most Jobs in 5 Years (http://news.lp.findlaw.com/ap/f/1311//03-07-2008/20080307115005_06.html)
By JEANNINE AVERSA AP Economics Writer



Apparently, Bush's Labor Department is part of the media conspiracy. :rolleyes:

What policies exactly caused this? You mean all the tax breaks and everything to stop the companies from shutting down to find cheaper labor?

What exactly is Bush or the Republican cause in any of this? That's the question. Most of these problems having nothing to with the government, yet's it's being portrayed like the Republicans are to blame in an election year and no one is called on it.

What policies exactly caused this? You mean all the tax breaks and everything to stop the companies from shutting down to find cheaper labor?

What exactly is Bush or the Republican cause in any of this? That's the question.

Now you are moving the goalposts.

Are you admitting the economy has gotten bad and just dispute the causes?

Or are you simply playing games when faced with facts?

I'm saying the economy has always been like this, there's been no huge changes, especially since 2004 when they were saying it was so terrible, despite the fact that the numbers were virtually the same as they had been under the previous administration that got so much credit for the economy.

So why has it been almost four years since we started how terrible the economy is in the newspapers every day? Why is this all of a sudden a huge problem when it will impact the elections?

What policies exactly caused this?

so you don't think the war in Iraq and Afghanistan have anything to do with higher oil prices?

You don't think higher fuel costs have anything to do with higher costs across the spectrum or goods?

you don't thing deregulation of the financial institutions allows them to get away with shadier deals?

The govt has no way of affecting the economy? really?

I'm saying the economy has always been like this, there's been no huge changes, especially since 2004 when they were saying it was so terrible, despite the fact that the numbers were virtually the same as they had been under the previous administration that got so much credit for the economy.

So why has it been almost four years since we started how terrible the economy is in the newspapers every day? Why is this all of a sudden a huge problem when it will impact the elections?

And I'm pointing out the facts -- even facts taken purely from the Bush Administration itself -- disagree with your assessment.

The economy has been better and it is currently in a downward spiral.

so you don't think the war in Iraq and Afghanistan have anything to do with higher oil prices?

You don't think higher fuel costs have anything to do with higher costs across the spectrum or goods?

you don't thing deregulation of the financial institutions allows them to get away with shadier deals?

The govt has no way of affecting the economy? really?

I don't think that adding more oil to the market, which is what the Iraq war did, is the cause for the oil prices going up, no.

And yes, I know that the whole country runs on trucks, which is why oil is one the few things that is actually worth fighting for, which unfortunately we haven't done. If the Iraq War has been about driving gas prices down to a quarter a gallon, it would have been somewhat worth it, that's the sad thing.

And I'm pointing out the facts -- even facts taken purely from the Bush Administration itself -- disagree with your assessment.

The economy has been better and it is currently in a downward spiral.

What impact do you think the press making a huge deal and writing about bad the economy is? That's the whole point I am making. They are intentionally trying to damage the economy for political reasons, just like in 2004 and in 1992 and 1988.

I don't think that adding more oil to the market, which is what the Iraq war did, is the cause for the oil prices going up, no.

And yes, I know that the whole country runs on trucks, which is why oil is one the few things that is actually worth fighting for, which unfortunately we haven't done. If the Iraq War has been about driving gas prices down to a quarter a gallon, it would have been somewhat worth it, that's the sad thing.

You are seriously deluded Eric.

The wars in the middle east have created instability in the oil market which drove prices WAY up.

And the so-called housing market crisis is bs. It wasn't that long ago when Bush was President that home ownership was at the highest point ever, this is a bullshit problem and neither the good nor the bad had anything to do with Bush.

do you understand anything about the reasons behind the housing crash?
you realize the cause of the crash is mostly the reckless lending of money to ppl unable to support their mortgages, this would explain why home ownership was exceptionally high and then now, soon to be, exceptionally low


saying that economics outcomes are uninfluenced by government is basically discrediting the role of government in every area, its insane

What impact do you think the press making a huge deal and writing about bad the economy is? That's the whole point I am making. They are intentionally trying to damage the economy for political reasons, just like in 2004 and in 1992 and 1988.

1. You have no evidence to back up your absurd claim.

2. As I've noted, President Bush himself would have to be part of this media conspiracy.

What impact do you think the press making a huge deal and writing about bad the economy is? That's the whole point I am making. They are intentionally trying to damage the economy for political reasons, just like in 2004 and in 1992 and 1988.

you need to show some proof of this beyond a tinfoil hat conspiracy theory.

are there any studies you can point to

no?

imagine that

What does any of that have to do with Bush or what exactly would have changed that?

Higher taxes is the only difference between the Republicans and the Democrats when it comes to the economy.

Government is one of the many sources of blame for the current economic downturn. As I stated earlier, there is a distinct lack of regulation in the credit market which has helped deepen the current crisis. The government should have introduced regulation before the crisis, rather than the legislation they are only enacting after the damage is done.

you need to show some proof of this beyond a tinfoil hat conspiracy theory.

are there any studies you can point to

no?

imagine that

My apologies. This like how democrats weren't saying that John Kerry should be elected for serving in Vietnam. No one can remember that far back.

Please see the signature.

My apologies. This like how democrats weren't saying that John Kerry should be elected for serving in Vietnam. No one can remember that far back.

Please see the signature.


What are you even talking about here?
Are you just trolling for donuts?

My apologies. This like how democrats weren't saying that John Kerry should be elected for serving in Vietnam. No one can remember that far back.

one fallacy piled on top of another.

No democrats said Kerry should be elected based only on his having served in Vietnam. His Vietnam experience was used by supporters as a reason to support him and was used by detractors against him.

Please see the signature.

Cute. And I'm not going to offer evidence that your tinfoil hat is too tight and cutting off circulation to your brain. It's common knowledge.

Please see the signature.
Common sense frequently isn't sense. By asking you to defend it I'm often hoping that you'll see the holes in it yourself.

That said, I think you're right about the housing crisis. I don't blame that on the government. I blame that on the consumers.

Well, the economy is not bad for me. Just before the housing market collapse, I sold my house for a bundle. I'm now making almost 75% more than I was making before, and the long term job prospects for me are only looking up.

Government is one of the many sources of blame for the current economic downturn. As I stated earlier, there is a distinct lack of regulation in the credit market which has helped deepen the current crisis. The government should have introduced regulation before the crisis, rather than the legislation they are only enacting after the damage is done.
Easier said than done. Considering that there were plenty of people even within the industry who had no idea what was going on, I rather doubt that the US government would have been able to come up with good regulation of this stuff. I mean, half the problem was caused by gaps in the Basel rules, which encouraged banks to move all this stuff to off-sheet entities.

This is just the sort of thing that happens sometimes. They're not gonna make the same mistakes again, but they're gonna make different ones. And government can't magically anticipate how to prevent it. We can take comfort in the fact that subprime mortgage securitisation allowed many thousands of poor families to own homes that otherwise they'd never have been able to get and that ultimately the industry will return to the trend, which means upwards at rocket pace.

Government is one of the many sources of blame for the current economic downturn. As I stated earlier, there is a distinct lack of regulation in the credit market which has helped deepen the current crisis. The government should have introduced regulation before the crisis, rather than the legislation they are only enacting after the damage is done.
No one forced those consumers to take out more debt than they could afford, and no one forced those lenders to lend money they couldn't reasonably expect back.

That's why even George W. Bush is acknowledging the economy has clearly slowed down. link (http://money.cnn.com/2008/03/07/news/economy/bush_econ/index.htm?cnn=yes) :headbang:

Bush...told the truth? :eek:

a real one?



:p the joke was there. I had to do it.

What joke?

Easier said than done. Considering that there were plenty of people even within the industry who had no idea what was going on, I rather doubt that the US government would have been able to come up with good regulation of this stuff. I mean, half the problem was caused by gaps in the Basel rules, which encouraged banks to move all this stuff to off-sheet entities.

This is just the sort of thing that happens sometimes. They're not gonna make the same mistakes again, but they're gonna make different ones. And government can't magically anticipate how to prevent it. We can take comfort in the fact that subprime mortgage securitisation allowed many thousands of poor families to own homes that otherwise they'd never have been able to get and that ultimately the industry will return to the trend, which means upwards at rocket pace.

Well, the failure of the Basel accords to address off-balance sheet finance should have been dealt with already - its a recipe for disaster, as are most measures that reduce business transparency.

I feel the simplest way to regulate would have been something similar to the Glass-Steagall system, preventing commercial banks from investing in certain securities. I'm not up for a full return, but surely CDO's would be on the asset blacklist. I feel that valuation of risk and the methods that rating agencies use to rate debt need some control as well.

No one forced those consumers to take out more debt than they could afford, and no one forced those lenders to lend money they couldn't reasonably expect back.

Indeed. But now the stupidity of certain lenders and homeowners has contributed to a possible economic downturn. If it was only the people involved who were suffering then yes, you could say that they made bad decisions so who cares. But this has led to increases in unemployment and a nationwide fall in house prices, affecting far more than the people who made the mistakes in the first place. Hence the need for regulation to prevent a recurrence.

Wait wait wait, let me make sure I understand this. The press, the press has intentionally engaged in a massive conspiracy to harm the american economy so that the public would associate this with the republican administration and vote democrat.

That the press is intentionally trying to harm the US economy.

Are you fucking shitting me?

You did make note of who you were responding to, yes?

What impact do you think the press making a huge deal and writing about bad the economy is? That's the whole point I am making. They are intentionally trying to damage the economy for political reasons, just like in 2004 and in 1992 and 1988.

Wait wait wait, let me make sure I understand this. The press, the press has intentionally engaged in a massive conspiracy to harm the american economy so that the public would associate this with the republican administration and vote democrat.

That the press is intentionally trying to harm the US economy.

Are you fucking shitting me?

Economy is not shitty for everyone. The wife and I are making more money now then we ever have. Guess I will be buying some cheap property real soon. :p

Wait wait wait, let me make sure I understand this. The press, the press has intentionally engaged in a massive conspiracy to harm the american economy so that the public would associate this with the republican administration and vote democrat.

That the press is intentionally trying to harm the US economy.

Are you fucking shitting me?

If you consider that consumer confidence, and faith in the information that the press provides has an effect on major markets, it's certainly possible.

I might add that a lot of Democrats have constantly been saying the country was in the economic toilet for the entire two terms of the Bush Administration, even when the numbers were all good.

The economy is in a recession. It is not uncommon for that to happen. Even if we have GDII(Great Depression 2) eventually we will be rich again in a matter of decades. Infact the economy was strengthened after the great depression so I am not worried about the outcome of this economic crisis.

If you consider that consumer confidence, and faith in the information that the press provides has an effect on major markets, it's certainly possible.

Possible, but unlikely. For one thing you'd have to imagine that various networks coming together to plot against the Republicans. More likely a recession did occur combined with the media's propensity for sensationalism, especially when it comes to fear and anxiety, is why we've been hearing about a recession.

I might add that a lot of Democrats have constantly been saying the country was in the economic toilet for the entire two terms of the Bush Administration, even when the numbers were all good.

Sources?

answer the question about the price of oil per barell

no, you aren't interested in an honest debate are you?

I'll tell you

when Bush took office - oil was $30/barell

now it's over $100/barell

the housing market crisis is BS? is that why so many mortgage lenders declared bankruptcy and went out of business? is that why banks are refusing credit to each other? it's all because the liberal media said there is an economic slowdown? The chairman of the federal reserve is lying? really?

A little off on your numbers there, the price of oil around the presidency was about $ 50 per barrel, but none the less, it still has increasd dramaticly. The current price is about $ 105 a barrel (I shuddered as I typed that number). And frankly, I doubt that all of this is bs, all of the roadmarks lead to recession.

And the chairman is not lying....unless....according to Eric...its all a democrat conspiracy to take control of the world!!! (insert evil laughter here) :)

I'm saying the economy has always been like this, there's been no huge changes, especially since 2004 when they were saying it was so terrible, despite the fact that the numbers were virtually the same as they had been under the previous administration that got so much credit for the economy.

So why has it been almost four years since we started how terrible the economy is in the newspapers every day? Why is this all of a sudden a huge problem when it will impact the elections?

Yes there have been huge changes, economists in the earlier years of the millenium predicted that our economy was going to become bloated, due to low-teaser mortgages, huge spending with credit in America going like a seismometer, the rising tension in the middle east, as well as outsourcing (although studies show that more jobs are actually created in America due to oursourcing. But who wants to listen to some Indian guy thousands of miles away trying to fix your computer. linky (http://tech-support.funnypart.com/)). As the economy formed a huge bubble, most democrates immediatly pounced on the issue, for in their minds, was the key to win back
Congress, and the white house.


so you don't think the war in Iraq and Afghanistan have anything to do with higher oil prices?

You don't think higher fuel costs have anything to do with higher costs across the spectrum or goods?

you don't thing deregulation of the financial institutions allows them to get away with shadier deals?

The govt has no way of affecting the economy? really?

Don't forget Katrina, average gas prices went up $1.00.

And I'm pointing out the facts -- even facts taken purely from the Bush Administration itself -- disagree with your assessment.

The economy has been better and it is currently in a downward spiral.

Requoted for aggreance.

Economy is not shitty for everyone. The wife and I are making more money now then we ever have. Guess I will be buying some cheap property real soon. :p

I hear Miami condos will be up for grabs. :D

A little off on your numbers there, the price of oil around the presidency was about $ 50 per barrel,

Incorrect, in 2000 the cost of a barrel of oil was about $33 (http://www.inflationdata.com/inflation/inflation_rate/Historical_Oil_Prices_Table.asp). It did not ready an adjusted price of $50 a barrel until 2005. Currently at approximately $105 a barrel, oil is at its most expensive in history, even taking account the oil crisis of the 70s and adjusting for inflation.

I hear Miami condos will be up for grabs. :D

I stay out of Florida for many, many reasons.

Funny how the press seems to decide that in every election year that Republican is running for reelection.

When is there ever not a Republican running? And there is no Republican 'reelection', since Bush CANNOT run.

We need to fill up with some good old fashioned salvation....

http://upload.wikimedia.org/wikipedia/commons/9/9f/Potlatch_gas.jpg

Incorrect, in 2000 the cost of a barrel of oil was about $33 (http://www.inflationdata.com/inflation/inflation_rate/Historical_Oil_Prices_Table.asp). It did not ready an adjusted price of $50 a barrel until 2005. Currently at approximately $105 a barrel, oil is at its most expensive in history, even taking account the oil crisis of the 70s and adjusting for inflation.

The old price was in April of 1980 at $39.50 a barrel or $103.76 in today's dollars. So yes we are at record levels.

Source: http://www.nytimes.com/2008/02/26/business/26gas-web.html?ex=1361682000&en=9484d322b634c807&ei=5088&partner=rssnyt&emc=rss

And there is no Republican 'reelection', since Bush CANNOT run.

Why not? After all, the man never really served as President. Cheney did.

*runs*

It would take some serious delusion, ignorance, or intellectual dishonestyAnd/or republicanism/republican sympathy. Pretty much part & parcel these days.

Yes, that's how these things work. Very rarely do recessions occur gradually; if they did, it would be easy for central banks to stop them. Virtually every time it's been some kind of sudden shock that caused the economy to suddenly cave in on itself and fall in to recession. So, there's hardly anything unexpected about this; we've had a seven year expansion and it's due time for another recession.

For which, people like yourself can, knowingly, hold certain right-wing blabbermouths in particular regard for each and every pathetic attempt to argue otherwise right up until they can't hide it anymore, twisted fuckwits that they are, and all.

There is never a watershed event that signals a recession.
*blinks*

no there wasn't
There was a study of right-wing bloviator diatribe (far & wide) that was consistent with the assessment and equally inconsistent with the facts, what with it being an assessment made by shared delusions of right-wing bloviators.

not suddenly at all. its been going to hell in a hand basket for the past 30 years at least. lord shrubbery the simply simply pushed it over the final top with his gratuitous wars of greed, vengence and megalomania.

and maybe more then half assed deliberately to prevent resources being available for anything useful to anybody. which is how that mentality certainly acts as if that is how it thinks.

=^^=
.../\...

That's exactly what I'm saying. All of a sudden, the press starts saying that economy, which hasn't made any kind of drastic change in a long time is terrible. You just broke my deludometer.
And of course asking the President about it is going to have him stating the obvious, then they report it like it's huge news. What impact exactly does Bush or any President have on the economy? I just never understood how a President gets so much credit or blame for economy that Congress creates.It's the representative nature of the office.
It's just funny how this always happens at the beginning of an election year when a Republican occupies the White House and yet no one ever starts questioning it.Maybe we should start asking why the economy is always in trouble when a Republican president leaves office.\

Though, to be honest, I'd like to see some hard evidence in favor of the hypothesis that every time a Republican president is going to end a term, the media cries bloody recession, that this is undeserved, and that this happens more often than under Democratic presidents, and that this too is undeserved.
Does anyone else remember the 2004 campaign when high ranking democrats were on every news station talking about how terrible the economy is and how it's not going to get better and basically doing everything could to bring that about so that they could win any election? It was despicable.Isn't it funny that the housing market collapsed completely independently of media coverage, and how that means the Democrats in 2004 were actually right?

Please see the signature.Physician cure thyself. Until you've actually made the effort to understand what's going on in the global and American economy, kindly shut up. I personally suggest watching the international editions of CNN and BBC (CNN International and BBC World, respectively) for factual information, as these are geared for a business audience, i.e. people that can't afford to avoid hearing bad news.

Funny how the press seems to decide that in every election year that Republican is running for reelection.

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future. No matter who is President. Clinton got credit that anyone with a brain knows was the result of being forced to sign reforms by the Republican congress, it just amazes me how no one seems to comment on the press campaign to hurt the economy in favor of a DNC victory. 2004 was particularly sickening. It almost made me decide to vote out of spite.

I agree, the fact is if the Iraq war had gone well, President Bush s' popularity would have been high and the Republicans would not have lost the mid term elections.

As for those who made fun and called President Bush a dictator. A real dictator would never have let them make fun of him and critized him and would never have allowed the Republican party to loose the mid term elections.

I agree, the fact is if the Iraq war had gone well, President Bush s' popularity would have been high and the Republicans would not have lost the mid term elections.

As for those who made fun and called President Bush a dictator. A real dictator would never have let them make fun of him and critized him and would never have allowed the Republican party to loose the mid term elections.It's not as though he doesn't try though :p

Well, the failure of the Basel accords to address off-balance sheet finance should have been dealt with already - its a recipe for disaster, as are most measures that reduce business transparency.
There's always a fine line between transparency and rules to actually stop you from doing something. I can agree with the former, the latter I'm sceptical on.

And of course, you can even push normal transparency too far - it's not like investment banks can really afford to make it all too public where they're getting the returns from, since it's their expertise and special knowledge that is earning their fees.

I feel the simplest way to regulate would have been something similar to the Glass-Steagall system, preventing commercial banks from investing in certain securities. I'm not up for a full return, but surely CDO's would be on the asset blacklist.
I'm actually doing two courses at uni in this area, so I can tell you more at a later stage, but suffice to say that with the massive opportunities financial innovation brings along banks that find themselves excluded will become smaller and smaller in relative terms. It just seems silly to have homebuyers suffer higher rates than necessary because "commercial banks" can't secure finance at the sorts of prices investment banks can. Ultimately to the homebuyer securitisation doesn't change much (apart from a few exceptions) - you still repay your loan as before and what happens with that money afterwards isn't really any of your concern.

I feel that valuation of risk and the methods that rating agencies use to rate debt need some control as well.
No doubt rating agencies made mistakes. Perhaps they were even systemic in that the people who paid their fees were the people who created these securities and were trying to sell them off.

But the real mistake was simple (and therefore all the more stupid): they focused just on the default risk, and not about issues of liquidity. The problem with subprime-backed papers isn't that they won't bring the returns it says in the contract, it's that if you have the contract you won't find anyone to sell it on to. That rating agencies wouldn't factor this in is quite astonishing, but not something you're going to see again, regardless of what exactly the instrument of the future might be. More importantly, if someone in the government had noticed this, don't you think they would have mentioned it at some point? And don't you think a few people would have listened? Government agencies were being just as stupid as anyone else, and any regulations will always be lagging behind the times and be based on hindsight, at which point self-regulation will already be in effect.

And remember, financial innovation is also going to do something good for the planet soon - carbon trading is only beginning to take off, and it's a whole new world of possibilities for the industry. I wouldn't want that put at risk by overenthusiastic governments who think they know better.

There was a study about the top reason stock brokers weren't buying and the top reason turned out to be fear of a Democratic president.

Source it.

That's exactly what I'm saying. All of a sudden, the press starts saying that economy, which hasn't made any kind of drastic change in a long time is terrible. And of course asking the President about it is going to have him stating the obvious, then they report it like it's huge news. What impact exactly does Bush or any President have on the economy? I just never understood how a President gets so much credit or blame for economy that Congress creates.

I dunno, spending trillions of dollars on a war might just affect the economy... and tax cuts for big business might just affect the economy... and trade agreements might just affect the economy... and foreign policy might just affect the economy....

My apologies. This like how democrats weren't saying that John Kerry should be elected for serving in Vietnam. No one can remember that far back.

Please see the signature.

Except your so-called "common knowledge" isn't common -- it's a complete rejection of reality and substitution of your own.

Really, it's ok if you can't defend your argument.

And if you can, then do it and show us where we're wrong. Source texts that support your opinion.

Wait wait wait, let me make sure I understand this. The press, the press has intentionally engaged in a massive conspiracy to harm the american economy so that the public would associate this with the republican administration and vote democrat.

That the press is intentionally trying to harm the US economy.

Are you fucking shitting me?

Don't forget that because this is "common knowledge", it needs not be actually proved.

Why not? After all, the man never really served as President. Cheney did.

*runs*

Heheheh, so by that logic, THAT's where Hillary has all her experience!

I dunno, spending trillions of dollars on a war might just affect the economy... and tax cuts for big business might just affect the economy... and trade agreements might just affect the economy... and foreign policy might just affect the economy....
Don't each one of those take the complicity of a Congress? What effect can a President have on his own? Royal Decrees(Executive Orders) only have so much impact and also technically require Congress to abstain from acting to prevent them.

Heheheh, so by that logic, THAT's where Hillary has all her experience!
There was that statement back in the WJC administration that "...We are the President." I think someone should remind her of that.

Don't each one of those take the complicity of a Congress? What effect can a President have on his own? Royal Decrees(Executive Orders) only have so much impact and also technically require Congress to abstain from acting to prevent them.Well, sure, the Republican dominated Congress shares plenty of blame as well. It's a pity the Dems are a tad incompetent when it comes up to cleaning messes, though. =/

Well, sure, the Republican dominated Congress shares plenty of blame as well. It's a pity the Dems are a tad incompetent when it comes up to cleaning messes, though. =/
Only in recent years. I believe we were speaking more generically about what any President could do to affect the economy for good or bad.

Don't each one of those take the complicity of a Congress? What effect can a President have on his own? Royal Decrees(Executive Orders) only have so much impact and also technically require Congress to abstain from acting to prevent them.

Indeed, but they also require his signature. See all the publicity shots with him signing stuff with multiple pens.

There was that statement back in the WJC administration that "...We are the President." I think someone should remind her of that.

Indeed.... because that would make her ineligible, wouldn't it? FWIW though, I can't find any direct attribution of that statement to her -- it apparently appeared in a book called Blood Sport and was one of those "So and so says Ms. Clinton said..." things, so I would take it with an ENORMOUS grain of salt.

Did you notice how I said reelection? As in they would be hurt by the insinuations or is that too much to ask?

Really? Who was saying that the economy was in the crapper when Reagan was running for re-election? If I recall, everyone thought it was doing quite well despite the fact that it was the first time that "homeless" became a household word.

The economy has been in a downward spiral since Bush came in to office. There's nothing "sudden" about this news. Yes, there have been a few bright spots, like when someone is strangling you and they let go for a second to adjust their grip. You get a breath of fresh air, but it's not going to do much good in the long run unless someone gets the strangler off of you.

Well, sure, the Republican dominated Congress shares plenty of blame as well. It's a pity the Dems are a tad incompetent when it comes up to cleaning messes, though. =/

It's a sad combination of the strong tendency of a lot of people to act sheep like and not think for themselves when bullies lie to them. You can't really blame 49-51 Democratic Senators for having to answer to the 65% of the population that thinks torture, murder, and the abolition of civil rights are ok as long as the President says so.

At this point you'd have to declare the Republican Party an organization that "has engaged in insurrection against the United States," which would make all republicans ineligible for office without the express consent of Congress.

I agree, the fact is if the Iraq war had gone well, President Bush s' popularity would have been high and the Republicans would not have lost the mid term elections.

That's a bit like saying "if Bush didn't suck, people would think he was good." The failure of the Iraq war was not some fluke occurrence that tarnished an otherwise sterling presidency. It is a salient aspect of the incompetence that arises when people surround themselves with advisers that will only tell them what they want to hear.

As for those who made fun and called President Bush a dictator. A real dictator would never have let them make fun of him and critized him and would never have allowed the Republican party to loose the mid term elections.

That doesn't mean that Bush isn't a dictator. It means that he isn't running a dictatorship. It's a bit like calling a woman with fertility problems a "mother who's trying to have a baby."

Bush's (as well as his courtiers') personality is one that leads them to destroy opposition by fair means or foul regardless of the consequences to others or to their own performance. Like when Bush threatened to veto any spending bills that outlawed torture, including the national defense budget. He was essentially saying "I'll imperil the nation's security to maintain my right to torture."

Or when he had the identity of a CIA agent working on nuclear non-prolifaration outed to the public because her husband caught him out in a lie.

That's a dictator. The fact that America is not a dictatorship is immaterial.

No.

It wouldn't matter, a Republican isn't running for reelection either.

And the economy has been fucked since the housing bubble hit the pin point. They are just now kind of admitting "yeah, the economy is kind of fucked up. The housing bubble burst and downward spiral of the dollar? Not a sign of anything at all!"

Oh, it's not just bad. There is a huge crisis in the US economy. The entire debt market has frozen.

So, good luck with that. Personally I find the whole thing a bit of a LOLday. If for no other reason that it's going to be lazy government employees that get shafted this time around.

Indeed.... because that would make her ineligible, wouldn't it? FWIW though, I can't find any direct attribution of that statement to her -- it apparently appeared in a book called Blood Sport and was one of those "So and so says Ms. Clinton said..." things, so I would take it with an ENORMOUS grain of salt.
I remember it being a big deal at the time. But I can't remember in what context the statement was reported.

Funny how the press seems to decide that in every election year that Republican is running for reelection.

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future. No matter who is President. Clinton got credit that anyone with a brain knows was the result of being forced to sign reforms by the Republican congress, it just amazes me how no one seems to comment on the press campaign to hurt the economy in favor of a DNC victory. 2004 was particularly sickening. It almost made me decide to vote out of spite.

The economy is screwed. Even financial papers (like the IBD) run by Republicans say that. The Republicans spend far too much, and this ruins the economy. Then they lower the interest rates; that is proverbially cutting-off the toe to cure the corn.

And remember, financial innovation is also going to do something good for the planet soon - carbon trading is only beginning to take off, and it's a whole new world of possibilities for the industry. I wouldn't want that put at risk by overenthusiastic governments who think they know better.

Carbon trading, an innovation created by governments which requires government supervision to be viable, is at risk by overenthusiastic governments how?

http://www.mercurynews.com/realestatenews/ci_8487733
Nothing to see here, move along OP'r.

Funny how the press seems to decide that in every election year that Republican is running for reelection.

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future. No matter who is President. Clinton got credit that anyone with a brain knows was the result of being forced to sign reforms by the Republican congress, it just amazes me how no one seems to comment on the press campaign to hurt the economy in favor of a DNC victory. 2004 was particularly sickening. It almost made me decide to vote out of spite.
I am confused. The OP seems to be declaring that the correlation of the press reporting a bad economy and Republicans is a sign of causality. Not a wild conclusion; it is not unbelievable that reporters would be any less biased than normal people.
What confuses me is that the OP does not continue with the logic to reach other conclusions. For example, perhaps the reporting of a bad economy is due to...a bad economy. In this instance, the causes of the reporting are not so much a bias in the mainstream media, but the effect of reality on what is reported.

I am confused. The OP seems to be declaring that the correlation of the press reporting a bad economy and Republicans is a sign of causality. Not a wild conclusion; it is not unbelievable that reporters would be any less biased than normal people.
What confuses me is that the OP does not continue with the logic to reach other conclusions. For example, perhaps the reporting of a bad economy is due to...a bad economy. In this instance, the causes of the reporting are not so much a bias in the mainstream media, but the effect of reality on what is reported.
You seem to be saying, if i gather you right, is that reality doesn't seem to have a conservative and/or republican bias in this case.

You seem to be saying, if i gather you right, is that reality doesn't seem to have a conservative and/or republican bias in this case.

Well, I wouldn't want to assume anything, but it could certainly be interpreted that way. :)

Well, I wouldn't want to assume anything, but it could certainly be interpreted that way. :)

True, true ... there is a pretty convincing case made on this thread, it would appear, and was summarized aptly there.
I just hope that i'm not too prejudiced by that for future threads and future reference. ;)

*Shakes head*

Forgive me for not going into depth.

Whenever a Republican administration is going to suffer from the allegations that the economy is bad. Don't be a weasel and make a 10 page thread on that.

1988, 2004 which didn't exactly have much difference between the years before and after, yet the economy was always so terrible.

It's only March, by September, it will the be the worst economy in history.

You're off the mark.

1988 was Bush Sr. vs. Dukakis. The economy was fine, and no Republican was running for re-election unless you're insinuating that Bush 41 was an outgrowth of Reagan, which would be a reasonable statement. Thing is, you weren't making it.

See, HRH, when you make huge mistakes like these, THAT's why people tend to go out of their way to debunk every post you make -- it's hard to take you seriously when you can't get even the most obvious of facts correct. It's not the evil "drive-by" media, and it's not the damned liberals -- it's your willful disregard of facts that makes some of us shake our heads in wonderment at some of your posts.

2004? Bush 43 vs. Kerry. Now there WAS a Republican running for re-election that time, but the economy wasn't the big deal then, was it? It was Iraq and it was the many interpretations of Kerry's war record.

1988 I can see you missing, it's 20 years ago. But the last election? Seriously, why should I read anything after that if you're willing to steamroll reality just to make your thread title work?

You're off the mark.

1988 was Bush Sr. vs. Dukakis. The economy was fine, and no Republican was running for re-election unless you're insinuating that Bush 41 was an outgrowth of Reagan, which would be a reasonable statement. Thing is, you weren't making it.

See, HRH, when you make huge mistakes like these, THAT's why people tend to go out of their way to debunk every post you make -- it's hard to take you seriously when you can't get even the most obvious of facts correct. It's not the evil "drive-by" media, and it's not the damned liberals -- it's your willful disregard of facts that makes some of us shake our heads in wonderment at some of your posts.

2004? Bush 43 vs. Kerry. Now there WAS a Republican running for re-election that time, but the economy wasn't the big deal then, was it? It was Iraq and it was the many interpretations of Kerry's war record.

1988 I can see you missing, it's 20 years ago. But the last election? Seriously, why should I read anything after that if you're willing to steamroll reality just to make your thread title work?
Probably something to do with this ...
Forgive me for not going into depth.
:D

You're off the mark.

1988 was Bush Sr. vs. Dukakis. The economy was fine, and no Republican was running for re-election unless you're insinuating that Bush 41 was an outgrowth of Reagan, which would be a reasonable statement. Thing is, you weren't making it.


Maybe the way this thread shoulda started off was by replacing the phrase "Republican running for re-election" with "incumbent Republican President". Will that satisfy all y'all that would rather argue than understand?

Maybe the way this thread shoulda started off was by replacing the phrase "Republican running for re-election" with "incumbent Republican President". Will that satisfy all y'all that would rather argue than understand?

Yeah, that makes more sense. Still doesn't make the OP's claim true, however.

Really, it's ok if you can't defend your argument.

And if you can, then do it and show us where we're wrong. Source texts that support your opinion.


Alright, let's get this down. The democrats didn't try to break consumer confidence through the entire 2004 election to win? That just didn't happen? I dreamed all of the programs I watched and articles I read?

You have to fit into one of these categories:

1. You didn't pay attention to the election.
2. You are lying.
3. You have a terrible memory.

Unless it's the second, I don't see why you would even comment.

Are people actually saying that this didn't happen? Like the democrats saying you have to elect John Kerry for spending four months in Vietnam, I'm the only that one can even remember that?

If you paid attention, you'd notice there's a crisis going on because the stockbrokers fear there will be a downward trend.

The reason they fear this is because the media proclaims it will be. Self-fulfilling prophecies do apply to a market economy in which the media has a loud and authoritative voice.

It's only March, by September, it will the be the worst economy in history.

Actually, "the worst economy in history" by September is not all that far fetched...

There are problems with the economy. There's too much debt. Lenders lent way too much money to people that don't understand debt. Those people have just quit paying the bills. But increased debt is the real problem.

Fair enough, what do we do about it? And how is that going to help us now?

That's why I wonder what the Fed is thinking when it lowers the interest rates. Isn't that making it easier to borrow money? Isn't that the problem that got us here, to begin with?

The reason we are lowering interest rates is because an increase in exports in the best we can hope for right now, and lower interest rates would make it easier for manufacturers and export-oriented services such as banking to expand and modernize their production and bring that production to other nations.

Let's face it, the damage is already done, the consumption is dead, people have already borrowed about as much on bad credit as they can, their house prices are no longer going up, the dirty deed is done. The only good news is increased factory orders, mainly from abroad. Don't worry about those who borrowed too much, they have nothing left to borrow against.

Same thing with the handouts. We really don't need more money in the economy. We've been borrowing enough and putting it right back into circulation. Borrow, then buy. Isn't that how to fight a recession?

I agree with you, although Bush, politically, has to do something along that line right now because politics is politics and people want to see something being done, regardless of whether or not it works or even helps. Plus he needs clout for Iraq.

Seriously, we need to encourage saving again. And you know what? The FairTax would do just that.

We do, but that won't help right now. Right now, we need to encourage manufacturing and export trade again, and a lower priced dollar and lower interest rates may do just that.

The reason they fear this is because the media proclaims it will be. Self-fulfilling prophecies do apply to a market economy in which the media has a loud and authoritative voice.

That's a little chicken and the egg, now, isn't it? Reporting on stockbrockers being worried makes stockbrockers worried which makes stockbrockers worried which causes stockbrockers to be worried...

This sort of requires the amorphous 'media' to get up one morning and go, "You know what? Let's spook out stockbrockers by telling them they're worried," in order for the chicken to emerge without an egg.

Actually, "the worst economy in history" by September is not all that far fetched...

Ever read "Grapes of Wrath"? Doubt it will get that bad in our times.

Carbon trading, an innovation created by governments which requires government supervision to be viable, is at risk by overenthusiastic governments how?
For carbon trading to work, you need a functioning market. Investment banks and other organisations like that earn money by creating functioning markets and through that increase the value of securities and the like.

So any attack on these organisations is an attack against our ability to create markets and that includes carbon trading.

Maybe the way this thread shoulda started off was by replacing the phrase "Republican running for re-election" with "incumbent Republican President". Will that satisfy all y'all that would rather argue than understand?

Once again, it's not a matter of nit-picking here. Someone willing to make GLARING errors in a central theme of a thread doesn't want a reasoned argument, they just want a fight. And GHW Bush was not an incumbent in 1988 -- there was no incumbent. Keep trying, though, please.

Yeah, that makes more sense. Still doesn't make the OP's claim true, however.

Not even that; see last paragraph.

Alright, let's get this down. The democrats didn't try to break consumer confidence through the entire 2004 election to win? That just didn't happen? I dreamed all of the programs I watched and articles I read?

You have to fit into one of these categories:

1. You didn't pay attention to the election.
2. You are lying.
3. You have a terrible memory.

Unless it's the second, I don't see why you would even comment.

Are people actually saying that this didn't happen? Like the democrats saying you have to elect John Kerry for spending four months in Vietnam, I'm the only that one can even remember that?

You seem to remember it as being FAR more important than it actually was. And many in this forum already ripped you a new one for your other "point" about Kerry's war record a couple of months ago.

You seem to demand answers to questions that have no basis in reality. I'm sorry you can't see that some people don't feel like answering loaded and deliberately provocative questions for their own sake.

The economy is always an election issue at some point in every election cycle, and some years it's more prevalent than others. 1992, for example. For you to claim that it was as big in 1988 and 2004 as it was in 1992, AND claim there's some kind of pattern because you think it happened in two elections that are sixteen years apart is disingenuous at best, and just needlessly belligerent at worst.

Ever read "Grapes of Wrath"? Doubt it will get that bad in our times.
Yep, back in '87, times were tough for everyone. (http://www.theonion.com/content/node/33902)

As a completely unrelated question, does the name "Marrakech" come from the George Orwell story?

I'm the only that one can even remember that?

You should consider this attitude in context of mental stability. Seriously.
You take your own misconceptions far, far too seriously, and it almost always results in you getting your lunch eaten for you.

For carbon trading to work, you need a functioning market. Investment banks and other organisations like that earn money by creating functioning markets and through that increase the value of securities and the like.

So any attack on these organisations is an attack against our ability to create markets and that includes carbon trading.

http://pesd.stanford.edu/news/sciam/

Which republican is running for reelection this year that the media want to torpedo?

How did the media manufacture the subprime mortgage crisis and the global liquidity crisis?

Once again, it's not a matter of nit-picking here. Someone willing to make GLARING errors in a central theme of a thread doesn't want a reasoned argument, they just want a fight. And GHW Bush was not an incumbent in 1988 -- there was no incumbent. Keep trying, though, please.

Remember, we separated running for office from incumbent President. Ronald Reagan was an incumbent Republican President. Rule still applies. And as far as the OP is concerned, I'm not so sure he's wrong, I just don't have the subscription to Lexus-Nexus to research the claim.

[edit]
There certainly is precedent for emphasizing certain things during a Republican administration, and minimizing them during a Democratic reign... Homeless are one issue where there's a pretty solid trend.
From Media Research, recaps the '80s and '90s in an article about the renewed interest in the homeless, following the GWB election.
"During the Bush administration, the story count grew from 44 in 1989 to a peak of 71 in 1990, followed by 54 stories in 1991 and 43 in 1992. By contrast, stories on America's homeless dipped slightly to 35 stories in 1993, and 32 in 1994. In 1995, the number fell dramatically to just nine. When the count is broken down by network, CNN had the widest gap in reporting during the Bush years and Clinton years (90-30), closely followed by ABC (45-16), CBS (41-15), and NBC (36-15).
"

http://www.mrc.org/cyberalerts/2001/cyb20010212.asp

Remember, we separated running for office from incumbent President. Ronald Reagan was an incumbent Republican President. Rule still applies. And as far as the OP is concerned, I'm not so sure he's wrong, I just don't have the subscription to Lexus-Nexus to research the claim.

Fair enough. However, having voted in both the elections he mentions in the OP, I feel qualified to access my own memory of what the issues were, as they were bombarding us every day for over a year...as they usually do. I love my country, but the process is occasionally annoying and disheartening.

Funny how the press seems to decide that in every election year that Republican is running for reelection.

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future. No matter who is President. Clinton got credit that anyone with a brain knows was the result of being forced to sign reforms by the Republican congress, it just amazes me how no one seems to comment on the press campaign to hurt the economy in favor of a DNC victory. 2004 was particularly sickening. It almost made me decide to vote out of spite.

1. The Republican party does not have a President running for reelection.

2. The economy changed GREATLY during the Clinton administration. I attribute it to the internet revolution and Alan Greenspan. Greenspan's monetary policy is what led to such great growth.

3. http://www.measuringworth.com/datasets/usgdp/result.php

http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

http://www.bea.gov/national/pdf/nipa_primer.pdf

Currently job growth is lower than expected and is lower than the amount needed to keep up with the growing population.

Current growth is VERY slow. It's not a recession yet, but it could get there. With inflation rising, consumer confidence not as high as we'd want, and the value of the dollar being so low, we're not in a great place. Ass to that having our major banks having to take in large amounts of foreign capital and it looks even worse. I'm not saying we're in a dire crisis, but warning bells are ringing.

1. The Republican party does not have a President running for reelection.

2. The economy changed GREATLY during the Clinton administration. I attribute it to the internet revolution and Alan Greenspan. Greenspan's monetary policy is what led to such great growth.

3. http://www.measuringworth.com/datasets/usgdp/result.php

http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

http://www.bea.gov/national/pdf/nipa_primer.pdf

Currently job growth is lower than expected and is lower than the amount needed to keep up with the growing population.

Current growth is VERY slow. It's not a recession yet, but it could get there. With inflation rising, consumer confidence not as high as we'd want, and the value of the dollar being so low, we're not in a great place. Ass to that having our major banks having to take in large amounts of foreign capital and it looks even worse. I'm not saying we're in a dire crisis, but warning bells are ringing.

The slowdown in the economy has more to do with the simple fact that the world is unable to produce as much oil as the world's economy demands.

We've reached the limit of oil production, and no President is going to be able to do anything about it.

It is all a vast left-wing conspiracy. :rolleyes:

That's why even George W. Bush is acknowledging the economy has clearly slowed down. link (http://money.cnn.com/2008/03/07/news/economy/bush_econ/index.htm?cnn=yes) :headbang:

Is the OP seriously questioning why the media would report on a bad economy when there's a bad economy? It's beyond stupidity to suggest that this is just a ploy when the president himself admits (http://money.cnn.com/2008/03/07/news/economy/bush_econ/index.htm?cnn=yes)the economy is slowing. The SPX is at its lowest point in the last 18 months, unemployment is on a rise, we're on the verge of a recession, and the price of oil is at a historic high.

here's a thought, maybe they're reporting on a bad economy because the economy is bad.

Maybe it often comes out during republican administrations because republican leaders have been generally inept at solving economic problems.

Lol, the NSG bar association comes in play. But frankly you could have used two different articles ;)

But he said the long-term outlook is good, with a stimulus package enacted last month by Congress providing support for the economy.

Wait, is he saying that that bunch of liberal, Democratic congressmen seated in DC is actually doing something good for US economy?
WHEN does he think he is? 2004?

Really? Who was saying that the economy was in the crapper when Reagan was running for re-election? If I recall, everyone thought it was doing quite well despite the fact that it was the first time that "homeless" became a household word.

The economy has been in a downward spiral since Bush came in to office. There's nothing "sudden" about this news. Yes, there have been a few bright spots, like when someone is strangling you and they let go for a second to adjust their grip. You get a breath of fresh air, but it's not going to do much good in the long run unless someone gets the strangler off of you.

Ahem, where were you in 1989?
Western Savings and Loan (http://en.wikipedia.org/wiki/Western_Savings_and_Loan), any bells ringing?

But in 1989, Western Savings moved into second place--not for its size, but for the amount of its losses, with a whopping $1.06 billion net deficit, following a substantial but smaller loss the previous year. The venerable savings and loan was headed for takeover by the Resolution Trust Corporation in the federal depositor bailout process. The failure of Western Savings and nearly every other savings and loan in the nation were the result of the Reagan era savings and loan modifications which forced them to attempt to seek riskier investments."citation needed"

Fair enough, what do we do about it? And how is that going to help us now?



The reason we are lowering interest rates is because an increase in exports in the best we can hope for right now, and lower interest rates would make it easier for manufacturers and export-oriented services such as banking to expand and modernize their production and bring that production to other nations.

Let's face it, the damage is already done, the consumption is dead, people have already borrowed about as much on bad credit as they can, their house prices are no longer going up, the dirty deed is done. The only good news is increased factory orders, mainly from abroad. Don't worry about those who borrowed too much, they have nothing left to borrow against.



I agree with you, although Bush, politically, has to do something along that line right now because politics is politics and people want to see something being done, regardless of whether or not it works or even helps. Plus he needs clout for Iraq.



We do, but that won't help right now. Right now, we need to encourage manufacturing and export trade again, and a lower priced dollar and lower interest rates may do just that.

One that could be done now is to get experts into high schools and start making personal finance managment part of the curriculum.

Start at the bottom-in 9th grade. Maybe cut gym class in half.

Start with the basics of dedicating a percentage of earnings to savings. How to shop for banks for savings and checking and work your way up from there.

Start making it second nature for teenagers NOT to get into such pathetic negative equity, NOT to spend more than they make, NOT to pay 18% interest on disposable trash and meals they couldnt afford-which are shit in the sewer before they make their first minimum payment.

We do need a nationwide program of instruction and education for people to stop spending so far beyond their means.
Very few people used credit cards in the 50s, but the country grew and prospered by leaps and bounds.

SO- thats just my un rhearsed rant on a good place to start. Its an emergency epidemic.
I'm starting with my kids. Gving them an example with their allowances on what to save and how they should save it and what to spend and what to dedicate toward an emergency fund.

I've stopped giving nieces and nephews and friend's kids cheap plastic trash from China for birthdays and holidays.
Instead, I give them each a share of GE stock wit ha direct re-investment plan,so dividends continue to grow the investment without them doing anything.

So-maybe someday down the road, they'll appreciate a gift that held value- not something taking up space in a landfill that wont rot for a thousand years.

http://pesd.stanford.edu/news/sciam/
That's a great article, but I feel it's missing my point. There is a political dimension to creating the credits to be traded, of course.

But on the mechanical side, just because the credits have been handed there is no reason to expect that an effective and efficient market will suddenly pop up. What I was saying is that investment banks, through things like creating a new market every time they take a firm to the stock exchange, or through their ability to create derivatives that could mean a whole new dimension of trading the things they're based on, basically have the skillset that is needed to make carbon trading work not just on paper, but in the real world. Carbon exchanges, buying carbon credits as investment etc etc all has to form a part of the thing being healthy and sustainable without everyone just trying to get around it. I fully expect that if everything goes well and I end up working for an investment bank, I will be involved in carbon trading throughout my career.

So I don't see the point of forcing these institutions to give up these skills and attack modern financial innovations just because people don't always understand them properly. The subprime thing, as ugly as it is now, was for years a very positive thing and there really is no reason to assume that even with the crash on balance there will still be more poor people with homes than there would have been without it.

Remember, we separated running for office from incumbent President. Ronald Reagan was an incumbent Republican President. Rule still applies. And as far as the OP is concerned, I'm not so sure he's wrong, I just don't have the subscription to Lexus-Nexus to research the claim.

[edit]
There certainly is precedent for emphasizing certain things during a Republican administration, and minimizing them during a Democratic reign... Homeless are one issue where there's a pretty solid trend.
From Media Research, recaps the '80s and '90s in an article about the renewed interest in the homeless, following the GWB election.
"During the Bush administration, the story count grew from 44 in 1989 to a peak of 71 in 1990, followed by 54 stories in 1991 and 43 in 1992. By contrast, stories on America's homeless dipped slightly to 35 stories in 1993, and 32 in 1994. In 1995, the number fell dramatically to just nine. When the count is broken down by network, CNN had the widest gap in reporting during the Bush years and Clinton years (90-30), closely followed by ABC (45-16), CBS (41-15), and NBC (36-15).
"

http://www.mrc.org/cyberalerts/2001/cyb20010212.asp

What exactly is your edit intended to prove? Homelessness? It couldn't be that homelessness increases during a bad economy, could it? If you can show me that the homeless stories have increased starting in 2000 or 2001 and returned to Bush41 levels, you'll have a point.

EDIT: Upon further review, it's a bit disingenuous to link to a site that is patently conservative in its leanings in order to prove a conservative point. The MRC site purports to "expose media bias", but only A) since 1996, and only B) if it isn't a conservative outlet. Come on.

That's a great article, but I feel it's missing my point. It's alright, it was a matter of supplementation, not summation. I'd been reading about that on my vacation and thought it would help supplement the conversation a smidge.

What exactly is your edit intended to prove? Homelessness? It couldn't be that homelessness increases during a bad economy, could it? If you can show me that the homeless stories have increased starting in 2000 or 2001 and returned to Bush41 levels, you'll have a point.

EDIT: Upon further review, it's a bit disingenuous to link to a site that is patently conservative in its leanings in order to prove a conservative point. The MRC site purports to "expose media bias", but only A) since 1996, and only B) if it isn't a conservative outlet. Come on.
You have to take numbers where you can get them. At least the MRC doesn't have the same reputation for allowing make-believe news to be published as in the case of the NYT or for grudges to be perpetuated as in the case of CBS news. I just used it to illustrate the idea that some topics are treated differently, depending on what party's administration is in power. If I had a subscription to Lexus-Nexus, I could probably show the same thing, but I don't, so I can't.

Remember, we separated running for office from incumbent President. Ronald Reagan was an incumbent Republican President. Rule still applies. And as far as the OP is concerned, I'm not so sure he's wrong, I just don't have the subscription to Lexus-Nexus to research the claim.

[edit]
There certainly is precedent for emphasizing certain things during a Republican administration, and minimizing them during a Democratic reign... Homeless are one issue where there's a pretty solid trend.
From Media Research, recaps the '80s and '90s in an article about the renewed interest in the homeless, following the GWB election.
"During the Bush administration, the story count grew from 44 in 1989 to a peak of 71 in 1990, followed by 54 stories in 1991 and 43 in 1992. By contrast, stories on America's homeless dipped slightly to 35 stories in 1993, and 32 in 1994. In 1995, the number fell dramatically to just nine. When the count is broken down by network, CNN had the widest gap in reporting during the Bush years and Clinton years (90-30), closely followed by ABC (45-16), CBS (41-15), and NBC (36-15).
"

http://www.mrc.org/cyberalerts/2001/cyb20010212.asp

Are you aware that the peaks of homlessness articles in the coincide with the Western Savings and Loan (http://en.wikipedia.org/wiki/Western_Savings_and_Loan) crisys?
I tought the US learned how well voodoo economics works back in the 90es and wouldn't do the same mistake twice.

Are you aware that the peaks of homlessness articles in the coincide with the Western Savings and Loan (http://en.wikipedia.org/wiki/Western_Savings_and_Loan) crisys?
I tought the US learned how well voodoo economics works back in the 90es and wouldn't do the same mistake twice.
You can't mix supply side economics with other factors and then conclude that the tax cuts are the problem. Tax cuts have have been correlated over and over again with increased revenue. Deregulation and the corresponding S&L failures are a completely different matter...unrelated to any Kennedy, Reagan, or GWBush tax cuts.

You can't mix supply side economics with other factors and then conclude that the tax cuts are the problem. Tax cuts have have been correlated over and over again with increased revenue. Deregulation and the corresponding S&L failures are a completely different matter...unrelated to any Kennedy, Reagan, or GWBush tax cuts.

Correct me if I'm wrong, but I tought that voodoo economics and Reaganomics are synonymes.

Reagan eased or eliminated price controls on oil and natural gas, cable TV, long-distance telephone service, interstate bus service, and ocean shipping. Banks were allowed to invest in a somewhat broader set of assets, and the scope of the antitrust laws was reduced. The major exception to this pattern was a substantial increase in import barriers.
http://www.econlib.org/library/Enc/Reaganomics.html

You can't mix supply side economics with other factors and then conclude that the tax cuts are the problem. Tax cuts have have been correlated over and over again with increased revenue. Deregulation and the corresponding S&L failures are a completely different matter...unrelated to any Kennedy, Reagan, or GWBush tax cuts.

Increased revenue for whom? Certainly not those who need it most. All a $300 tax rebate does (never mind the $30M it costs to let the country know it's on the way...) is let you know how screwed you are.

Increased revenue for whom? Certainly not those who need it most. All a $300 tax rebate does (never mind the $30M it costs to let the country know it's on the way...) is let you know how screwed you are.

The rebate is more of a Keynesian approach... certainly not supply side. The tax revenue does, indeed, increase as taxes are cut. The economy grows. That doesn't mean everyone gets an instant raise, it means that they have greater opportunity.

Giving everyone $300 or $600 or whatever else only sounds good to politicians during an election year. If they really want to spur on the economy, they should make Bush's tax cuts permanent. Then business could plan past 2010.

Correct me if I'm wrong, but I tought that voodoo economics and Reaganomics are synonymes.


http://www.econlib.org/library/Enc/Reaganomics.html

Both of those are colloquial descriptions that really have no more meaning than what the author puts into them. "Voodoo Economics" was coined by GHWB in the primary campaigns and referred only to the idea that tax cuts would raise tax revenue. Reaganomics appears to apply to anything anyone wants it to.

One that could be done now is to get experts into high schools and start making personal finance managment part of the curriculum.

Start at the bottom-in 9th grade. Maybe cut gym class in half.

Start with the basics of dedicating a percentage of earnings to savings. How to shop for banks for savings and checking and work your way up from there.

Start making it second nature for teenagers NOT to get into such pathetic negative equity, NOT to spend more than they make, NOT to pay 18% interest on disposable trash and meals they couldnt afford-which are shit in the sewer before they make their first minimum payment.

We do need a nationwide program of instruction and education for people to stop spending so far beyond their means.
Very few people used credit cards in the 50s, but the country grew and prospered by leaps and bounds.

SO- thats just my un rhearsed rant on a good place to start. Its an emergency epidemic.
I'm starting with my kids. Gving them an example with their allowances on what to save and how they should save it and what to spend and what to dedicate toward an emergency fund.

I've stopped giving nieces and nephews and friend's kids cheap plastic trash from China for birthdays and holidays.
Instead, I give them each a share of GE stock wit ha direct re-investment plan,so dividends continue to grow the investment without them doing anything.

So-maybe someday down the road, they'll appreciate a gift that held value- not something taking up space in a landfill that wont rot for a thousand years.

That will help in 30 years. Right now, we've got a crisis on our hands.

Indeed. But now the stupidity of certain lenders and homeowners has contributed to a possible economic downturn. If it was only the people involved who were suffering then yes, you could say that they made bad decisions so who cares. But this has led to increases in unemployment and a nationwide fall in house prices, affecting far more than the people who made the mistakes in the first place. Hence the need for regulation to prevent a recurrence.
Unless you were investing in those companies, the only part that affects you directly is the excess labour and the fall of house prices, but those are all market effects that should have been planned for anyway.

If you're so over-leveraged that you needed your house price to stay constant or rise, then you're part of the problem.

Correct me if I'm wrong, but I tought that voodoo economics and Reaganomics are synonymes.
I believe that is talking about the repeal of the Glass-Steagall Act, which either happened during Reagan's reign or followed immediately afterwards.

The problem is: Europe for example never put in place an act like that in the 1930s. European banks grew steadily both across borders and across industries and what they call universal banking was generally quite common. But this consolidation and flexibility didn't cause Europe to constantly fall from one financial crisis into another, nor would you say that Europe is particularly in the grip of supply side economists. The deregulation in the US was simply the reversal of something of an overreaction - silly in particular because half the problem with the Great Depression in the US were anti-trust laws that forced banks to remain relatively small asset-wise and be limited geographically, so when they lost on the stock market they had basically no room in the reserves to deal with the bank run.

Anyways, "Voodoo Economics" is a derogatory term coined many years ago. Supply side economics (which is the actual name) has nothing voodoo about it - in fact the current problem regarding inflationary pressures in the US (oil now getting to $110, is it?) is a supply side problem and is unlikely to be dealt with by Keynesian "demand side" economics. There are two sides to the economy, the production or supply side, and the consumption or demand side. Keynes sorta assumed that producers would produce no matter what and the only determinant to target was consumption (ironically, one way to do that were the Bush tax cuts, which therefore weren't supply side economics at all). Supply side economists feel that this isn't quite accurate and that by changing the conditions faced by producers (corporate taxes, minimum wages, employment protection and welfare, better infrastructure, cheaper imported inputs etc) you can change how much is being produced, how much is being earned by companies (and their employees, to an extent) and therefore investment. The only problem is that sometimes supply siders fall into the trap of just sorta assuming that consumers will consume no matter what.

And most economists accept that both have a bit of truth to them and don't bother making a big deal of the distinction. So it's a bit sad that you still hear things like "voodoo economics" being said because it's just so stupid and unhelpful.

I believe that is talking about the repeal of the Glass-Steagall Act, which either happened during Reagan's reign or followed immediately afterwards.

The problem is: Europe for example never put in place an act like that in the 1930s. European banks grew steadily both across borders and across industries and what they call universal banking was generally quite common. But this consolidation and flexibility didn't cause Europe to constantly fall from one financial crisis into another, nor would you say that Europe is particularly in the grip of supply side economists. The deregulation in the US was simply the reversal of something of an overreaction - silly in particular because half the problem with the Great Depression in the US were anti-trust laws that forced banks to remain relatively small asset-wise and be limited geographically, so when they lost on the stock market they had basically no room in the reserves to deal with the bank run.

Anyways, "Voodoo Economics" is a derogatory term coined many years ago. Supply side economics (which is the actual name) has nothing voodoo about it - in fact the current problem regarding inflationary pressures in the US (oil now getting to $110, is it?) is a supply side problem and is unlikely to be dealt with by Keynesian "demand side" economics. There are two sides to the economy, the production or supply side, and the consumption or demand side. Keynes sorta assumed that producers would produce no matter what and the only determinant to target was consumption (ironically, one way to do that were the Bush tax cuts, which therefore weren't supply side economics at all). Supply side economists feel that this isn't quite accurate and that by changing the conditions faced by producers (corporate taxes, minimum wages, employment protection and welfare, better infrastructure, cheaper imported inputs etc) you can change how much is being produced, how much is being earned by companies (and their employees, to an extent) and therefore investment. The only problem is that sometimes supply siders fall into the trap of just sorta assuming that consumers will consume no matter what.

And most economists accept that both have a bit of truth to them and don't bother making a big deal of the distinction. So it's a bit sad that you still hear things like "voodoo economics" being said because it's just so stupid and unhelpful.

I believe the voodoo economic sides to supply side economics. Supply side economists argued that the Reagan tax cuts would boost savings and investment yet the savings rate slowly yet steadily declined. The deficit didn't matter since it was supposed to shrink as a booming economy came around. Productivity didn't start rising significantly until the mid 90s.

Unless you were investing in those companies, the only part that affects you directly is the excess labour and the fall of house prices, but those are all market effects that should have been planned for anyway.

If you're so over-leveraged that you needed your house price to stay constant or rise, then you're part of the problem.

Even if everyone had 'planned' for unemployment or a fall in their house value doesn't change the fact that its bad for the global economy and should be discouraged from happening again.

I believe the voodoo economic sides to supply side economics.
That sentence doesn't make sense to me.

Supply side economists argued that the Reagan tax cuts would boost savings and investment yet the savings rate slowly yet steadily declined.
But was that because of the tax cuts? I don't think so. Lots of things happened over the years, many of which discouraged Americans from saving and made borrowing more attractive to them. In recent years it was Greenspan's escapades, before then it was unrealistic expectations of personal wealth due to the tech boom and so on and so forth. And for a while there in the 90s saving wasn't looking too bad anyways.

http://www.frbsf.org/publications/economics/letter/2007/el2007-08b.gif

So it's entirely possible that without the tax cuts saving would have declined even further, but proving that is of course rather difficult.

Investment on the other hand was never a big problem for the US and I don't expect it to become one unless something nasty starts happening with the dollar.

The deficit didn't matter since it was supposed to shrink as a booming economy came around.
You can push everything too far, but strictly speaking a government budget deficit isn't that big a deal. It's a very Keynesian thing to do - spend when times aren't great and get the money back when they're good. Again, not supply side economics, and generally a sound sort of idea if politicians could actually get themselves to cut spending when it's appropriate.

Productivity didn't start rising significantly until the mid 90s.
And most of that had to do with computers and the internet. There are probably papers out there trying to isolate the various causes, but I'm not particularly in the mood to find them. Plus, the bls servers (http://www.bls.gov/mfp/mprdload.htm) don't let me access txt and zip files, so I can't even make an educated guess on the numbers myself.

Suffice to say that while productivity is a big deal in supply side economics, it's not the only one.

That's a little chicken and the egg, now, isn't it? Reporting on stockbrockers being worried makes stockbrockers worried which makes stockbrockers worried which causes stockbrockers to be worried...

It is. It's a positive feedback loop, a vicious cycle. It works both ways, though, and I think the media's influence on our society at large is often dismissed or forgotten, so that the media winds up carrying the torch and calling the shots.

This sort of requires the amorphous 'media' to get up one morning and go, "You know what? Let's spook out stockbrockers by telling them they're worried," in order for the chicken to emerge without an egg.

Not really. They just need people to look at the sales and say, "Damn! Stories about how the economy sucks are really doing well. Let's make more on that." No conspiracy needs to be involved, because most of us just take what's reported at face value or near enough, such that people (including many media reporters, journalists, writers, bloggers etc) are really just parroting what's being said by many folks.

Obviously a good many people think the economy is going down for their own reasons, but I think in this case the economy is a bit like Schroedinger's Cat, or a self-fulfilling prophecy. That is I strongly believe that "optimism" can make the economy and "pessimism" can break it.

That sentence doesn't make sense to me.

I meant to say there was a voodoo, aka bullshit, side to supply-side economics.



But was that because of the tax cuts? I don't think so. Lots of things happened over the years, many of which discouraged Americans from saving and made borrowing more attractive to them. In recent years it was Greenspan's escapades, before then it was unrealistic expectations of personal wealth due to the tech boom and so on and so forth. And for a while there in the 90s saving wasn't looking too bad anyways.

http://www.frbsf.org/publications/economics/letter/2007/el2007-08b.gif

So it's entirely possible that without the tax cuts saving would have declined even further, but proving that is of course rather difficult.

Investment on the other hand was never a big problem for the US and I don't expect it to become one unless something nasty starts happening with the dollar.

It wasn't caused by the tax cuts but the tax cuts did not deliver the promised increases in the savings rate. Its possible that it decreased the rate of the descesnion of the savings rate but its also possible it had no effect.


You can push everything too far, but strictly speaking a government budget deficit isn't that big a deal. It's a very Keynesian thing to do - spend when times aren't great and get the money back when they're good. Again, not supply side economics, and generally a sound sort of idea if politicians could actually get themselves to cut spending when it's appropriate.

I didn't say the deficit was a supply side policy or that deficits are never called for, but proponents of supply-side economics promised such high economic growth from supply side policies that the deficit would disappear. It did not deliver the promised growth.

And I do agree with you that much of Reagan's actual policies were Keynesian ones, ones taken to such extreme that no Neo-, New, or Post- Keynesian would endorse.


And most of that had to do with computers and the internet. There are probably papers out there trying to isolate the various causes, but I'm not particularly in the mood to find them. Plus, the bls servers (http://www.bls.gov/mfp/mprdload.htm) don't let me access txt and zip files, so I can't even make an educated guess on the numbers myself.

Suffice to say that while productivity is a big deal in supply side economics, it's not the only one.

Right. So the productivity gains had little to do with Reagan's supply side policies, though it could be construed that some of the gains happened because of the 1996 deregulation of the telecoms.

Anyway, I do no think that all of supply side economics is baseless, but it's policies did not have the benefits that its proponents initially promised, namely significantly higher economic and productivity growth.

It wasn't caused by the tax cuts but the tax cuts did not deliver the promised increases in the savings rate. Its possible that it decreased the rate of the descesnion of the savings rate but its also possible it had no effect.
But from a theory point of view, it's not exactly likely. There's the obvious, direct argument, namely that the extra money will be spent on consumption, investment and saving according to the marginal propensities of the recipients. And then there's the permanent income argument that would say that consumers, being able to anticipate the need to pay back future deficits, prepare themselves for potential future tax increases by saving rather than consuming.

On the other hand I can't think of a good reason why a tax cut would not have a positive impact on saving and investment.

I didn't say the deficit was a supply side policy or that deficits are never called for, but proponents of supply-side economics promised such high economic growth from supply side policies that the deficit would disappear. It did not deliver the promised growth.

And I do agree with you that much of Reagan's actual policies were Keynesian ones, ones taken to such extreme that no Neo-, New, or Post- Keynesian would endorse.
The important thing to note is that supply side economics doesn't particularly advocate deficits. It advocates deregulation and making it easier for businesses to produce things. Any stance taken by supply side economists with regards to the deficits doesn't tell us anything about that particular part of macroeconomics.

The problem here is that for whatever reason Keynesian tend to line up with the "left" and supply siders with the "right", even though it would at best be a marriage of convenience in the latter case and a rather abstract referral to the last chapter of the "General Theory" in the former. So if Keynesians didn't advocate the use of tax cuts to help an economy that was experiencing troubles, then that's fairly inconsistent on their part because Keynes' stance on the issue was clear.

Anyway, I do no think that all of supply side economics is baseless, but it's policies did not have the benefits that its proponents initially promised, namely significantly higher economic and productivity growth.
In Britain meanwhile, where Maggie was going all-out for the supply side, it did.

Anyways, the problem with macroeconomics is that it's difficult to isolate variables. It's possible if you collect a lot of data and know your econometrics, hence why I'm convinced if we looked for them we could find papers that would largely answer these questions, but simply because productivity growth increased after Reagan's presidency we don't know how much was due to effects of his policies and how much due to changes in technology.

Anyways, as far as I'm concerned, the important thing is that really only the budget deficit and government debt (that was his fault) and the saving rates (that probably wasn't) got worse during his term. All the other variables did well, so on the whole you can't accuse him of doing a bad job. And above you said that you think optimism can make a big difference - Reagan was great at producing it and the tax cuts probably played a part in that too.

So it's entirely possible that without the tax cuts saving would have declined even further, but proving that is of course rather difficult.
see, this I really dislike about economists and especially Reagannomic proponents. They announce that their economic strategies are the best and will definitely do suchandsuch.
Then of course the opposite happens. Instead of admitting their economic strategies were wrong, they airly declare that it 'would have been worse' if they hadn't done them and at any rate, there were factors beyond their control that caused the problem. Which is such a cop-out as that's something that can never be proven. And of course they then spend the next few decades demanding that their already proven-to-fail policies be re-implemented because, y'know, this time they REALLY WILL work.
That's not how things should work. If you are promising something and the total opposite happens you cannot in all honesty claim success in any way whatsoever.

Investment on the other hand was never a big problem for the US and I don't expect it to become one unless something nasty starts happening with the dollar.
nasty, like ever-rising commodity prices and countries (esp in the Middle-East) world-wide depegging themselves from the US$?

The economy has ranged from poor to awful for some time. It just is talked about more in an election year, for obvious reasons.

The economy has ranged from poor to awful for some time. It just is talked about more in an election year, for obvious reasons.

That, and per OP, some people have no grasp of said obviousness.

But from a theory point of view, it's not exactly likely. There's the obvious, direct argument, namely that the extra money will be spent on consumption, investment and saving according to the marginal propensities of the recipients. And then there's the permanent income argument that would say that consumers, being able to anticipate the need to pay back future deficits, prepare themselves for potential future tax increases by saving rather than consuming.

On the other hand I can't think of a good reason why a tax cut would not have a positive impact on saving and investment.

Well from a practical perspective it does not appear to have had much effect, at least not anywhere near the increase it was claimed it would.

The permanent income argument is not very compelling. I dont see someone saying to their spouse," the governments is spending $ 200 billion and yet is says it wont raise taxes. Given that we'll have to pay for it one way or another let's save an extra $7.50 each month."

The important thing to note is that supply side economics doesn't particularly advocate deficits. It advocates deregulation and making it easier for businesses to produce things. Any stance taken by supply side economists with regards to the deficits doesn't tell us anything about that particular part of macroeconomics.

The problem here is that for whatever reason Keynesian tend to line up with the "left" and supply siders with the "right", even though it would at best be a marriage of convenience in the latter case and a rather abstract referral to the last chapter of the "General Theory" in the former. So if Keynesians didn't advocate the use of tax cuts to help an economy that was experiencing troubles, then that's fairly inconsistent on their part because Keynes' stance on the issue was clear.

Supply side economicists dont like deficits much since it crowds out private investment, so I recall, but anyway my beef was that supply side policies did not result in the increased growth that was claimed it would have.

In Britain meanwhile, where Maggie was going all-out for the supply side, it did.

It did, to some degree, but I was talking about Reagan's policies and the US.

Anyways, the problem with macroeconomics is that it's difficult to isolate variables. It's possible if you collect a lot of data and know your econometrics, hence why I'm convinced if we looked for them we could find papers that would largely answer these questions, but simply because productivity growth increased after Reagan's presidency we don't know how much was due to effects of his policies and how much due to changes in technology.

Anyways, as far as I'm concerned, the important thing is that really only the budget deficit and government debt (that was his fault) and the saving rates (that probably wasn't) got worse during his term. All the other variables did well, so on the whole you can't accuse him of doing a bad job. And above you said that you think optimism can make a big difference - Reagan was great at producing it and the tax cuts probably played a part in that too.

Inflation and unemployment were both down though economic and productivity both stayed pretty miserly and some of the good points happened becuase of demand side policies. Hardly a stellar job.

see, this I really dislike about economists and especially Reagannomic proponents. They announce that their economic strategies are the best and will definitely do suchandsuch.
Then of course the opposite happens. Instead of admitting their economic strategies were wrong, they airly declare that it 'would have been worse' if they hadn't done them and at any rate, there were factors beyond their control that caused the problem.
But think about it: you can have a theory that something will cause something else, which is backed up by other things you have already learned and some sort of logical train of thought. But when you test it, something else happens.

If you do that in a physics laboratory, chances are there is something wrong with your theory. If you want to test gravity but only happen to have a leaf in the wind, or two magnets, chances are your results will not be what you expected. But should you conclude that gravity doesn't exist?

Fact of the matter is that in a situation as complex as this many factors will be at work at any one time. It may well be that supply side economics is completely wrong. But if you think so, you must do a lot better than just point at what happened in the 80s or 90s. You actually have to provide some sort of theoretical justification for what did happen, some sort of deeper understanding that allows you to reject what others have been saying.

That's not how things should work. If you are promising something and the total opposite happens you cannot in all honesty claim success in any way whatsoever.
And I don't think serious economists are claiming success on issues where they were clearly wrong, such as the Laffer Curve idea. But the reasoning behind abandoning what appears to be very solid theoretical foundation because what is in effect one tainted experiment isn't particularly good either. Instead economists are analysing what happened and working on improving recommendations next time around - and indeed, you'll see that supply side economists now are saying different things to what they said back then too.

nasty, like ever-rising commodity prices and countries (esp in the Middle-East) world-wide depegging themselves from the US$?
Sorta, except on a much bigger scale. Bernanke is running along an edge right now - the US economy needs monetary policy to be tight, but China and Japan are watching carefully. He said that as soon as the figures show even the slightest bit of a reversal he'll put up interest rates not just in little steps, but quite seriously. But if we end up with stagflation as the inflationary pressures (due in part to the low US dollar) feed through before they're out of the recession, and normal monetary policy loses its power (incidentally the sort of situation that was resolved by Reagan's strong approach) we may get to the point where China and Japan start selling dollars. And unlike a few middle eastern countries (http://en.wikipedia.org/wiki/List_of_countries_by_foreign_exchange_reserves), that would make a serious impression and be basically the end of the US dollar as global currency. It's coming one way or the other, but it'd be a lot better for everyone if it happened gradually.

We'll probably know more by the end of the year, but I'm hoping this recession won't take that long.

Both of those are colloquial descriptions that really have no more meaning than what the author puts into them. "Voodoo Economics" was coined by GHWB in the primary campaigns and referred only to the idea that tax cuts would raise tax revenue. Reaganomics appears to apply to anything anyone wants it to.

Strange, I was convinced it applyed to the economic packet the Reagan administrations implemented, not to anything anyone wants to.
One of the points he pursued was reduction of regulation wich was one of the reasons, as far as I know, of the Savings and Loans crisys.

About me saying that US voters didn't learn and voodoo... Maybe I'm biased by "liberal" media...
Reagonomics or 'voodoo economics'? (http://news.bbc.co.uk/1/hi/world/americas/270292.stm)
George Bush senior famously called Mr Reagan's ideas "voodoo economics" before he became vice-president of the United States. While challenging Mr Reagan in the Republican presidential primaries, he said he did not believe that supply-side reforms like ending regulation would be enough to rejuvenate the economy

If you do that in a physics laboratory, chances are there is something wrong with your theory. If you want to test gravity but only happen to have a leaf in the wind, or two magnets, chances are your results will not be what you expected. But should you conclude that gravity doesn't exist?

Takes first magnet, drops it. It falls. Repeat experiment 10 times... It always falls... Ok, gravity confirmed.
Takes second magnet (YOHOHO! I got TWO!!!!) one shoelace from his shoe (wow, lucky me I wasn't wearing mocassins!) and a stub of pencil (EVERY physicist has a stub of pencil in his pocket), builds a pendulum, lets it oscillate, scratches some formulas on the wall (you could have given me a piece of paper, you...). Repeat experiment 10 times... Smiles. Acceleration of gravity is 360 +- 1 Velkomoravian Thumbs (lenght of my thumb)/Velkomoravian Beats (duration of a heartbeat when resting).
As soon as you give me a meter and a chronometer I can give you the results in MKS or CGS measures.

NEVER underestimates Physics! Most of us work in chronically underbudgeted labs and still get the work done. In some schools you are actually given this kind of tasks just to teach you to think out of the box.

Even if everyone had 'planned' for unemployment or a fall in their house value doesn't change the fact that its bad for the global economy and should be discouraged from happening again.
You'd think the consequences we're now experiencing would be sufficient to deter this sort of thing.

I prefer things to be more concrete than 'hopefully people will learn a lesson'.

The rebate is more of a Keynesian approach... certainly not supply side. The tax revenue does, indeed, increase as taxes are cut. The economy grows. That doesn't mean everyone gets an instant raise, it means that they have greater opportunity.

Giving everyone $300 or $600 or whatever else only sounds good to politicians during an election year. If they really want to spur on the economy, they should make Bush's tax cuts permanent. Then business could plan past 2010.

So the national infrastructure's in great shape, is it?

This thread is why I find it so easy to say that economics is cousin to astrology with regard to science. I'm once again reminded of the Bloom County strip where one of Binkley's nightmares is two economists talking about the economy.

The rebate is more of a Keynesian approach... certainly not supply side. The tax revenue does, indeed, increase as taxes are cut. The economy grows. That doesn't mean everyone gets an instant raise, it means that they have greater opportunity.


I have not heard that tax revenue increases with a decrease in tax rates. In fact, I have heard the opposite, that the '80s tax decreases lowered tax revenue. My source is Economics Explained by Robert Heilbroner, who is admittedly a liberal economist, and Lester Thurow. But if you have contradictory sources, it's possible mine are flawed.

Also, economic growth does not mean economic growth for everyone. Again with the '80s: the economy as a whole grew, but it was the top quintile at the expense of the other four-fifths of the country. (From The Politics of Rich and Poor, by Kevin Phillips.)

The economy has ranged from poor to awful for some time. It just is talked about more in an election year, for obvious reasons.

Not really. The US has been averaging 4-5% growth (which is amazing in a developed country) up until this time - it just was centered in certain parts of the US (South and West mainly) while other parts (Midwest in particular) got none and even went backwards. Indeed, wage rates were even going up for a while, and in a very beneficial, high productivity, light inflation way. You just wouldn't notice it if you lived in the Northeast or Midwest - or listened to the news too much, because the news does not get paid to tell you stuff that's going good. (Why would they be?)

Oh, and you want to know the really sad thing: The places that are going to be hurt most by this subprime mortgage zaniness are not going to be the areas that were growing fastest! Expect Detroit to largely disappear from the map by 2018.

Well from a practical perspective it does not appear to have had much effect, at least not anywhere near the increase it was claimed it would.
I think we covered the practical perspective and can conclude that it doesn't confirm things either way.

The permanent income argument is not very compelling. I dont see someone saying to their spouse," the governments is spending $ 200 billion and yet is says it wont raise taxes. Given that we'll have to pay for it one way or another let's save an extra $7.50 each month."
It's not a 100% offset of course. But researchers (Fumo Hayashi, Quarterly Journal of Economics, 1985) have found that the PIH works quite well for about 80% or so of American households while the rest have "liquidity constraints" and therefore can't smooth their spending behaviour according to future expectations, including of things like tax increases.

Anyways, the debate about Ricardian equivalence itself hasn't been settled all that well, though I found this article (http://www.informaworld.com/smpp/content~content=a713757824~db=all) in particular interesting because it seems to cover all the bases.

...but anyway my beef was that supply side policies did not result in the increased growth that was claimed it would have.
Interest rates had been going up in the US for some time, yet inflation was still increasing (due to the oil price, ethanol subsidies and lots of other reasons). Does that mean monetary policy isn't effective to combat inflation, or does it just mean that its effect was drowned out by other impacts?

Inflation and unemployment were both down though economic and productivity both stayed pretty miserly and some of the good points happened becuase of demand side policies. Hardly a stellar job.
Compared to where the economy was before, I don't think it gives reason to complain.

I think the low productivity had as much to do with the private sector (the GMs and Fords and so on) as with policy. The Japanese were flexible, vibrant and kept their costs low while US companies were run according to outdated and dysfunctional business models. If that had to do with it, then there may not have been a lot any government could have done and the economy had to get shaken up by technology and the entrepreneurial opportunities that came along.

Again with the '80s: the economy as a whole grew, but it was the top quintile at the expense of the other four-fifths of the country.
I don't doubt that during the eighties different income groups experienced different growth rates. But I have a problem with the "at the expense of" because that's a pretty strong assertion that you're not going to be able to support just by pointing at growth rate differentials. So what's your reasoning?

The economy has not changed much at all over the past two administrations and is unlikely to change much in the future

Wrong, much?

I find it hard to believe that the economy has not changed when my house has gone from: $1,100,000 in worth to $600,000 since Bush has been in charge.

It isn't that 'damned liberal media' that is portraying things the wrong way, it's just facts. And the facts are:

1.) Housing market, crap.
2.) Stock market, crap.

More facts for ya:
http://www.ndol.org/upload_graphics/BP29_economy_chart1.jpg

KP1;13522562']Wrong, much?

I find it hard to believe that the economy has not changed when my house has gone from: $1,100,000 in worth to $600,000 since Bush has been in charge.

It isn't that 'damned liberal media' that is portraying things the wrong way, it's just facts. And the facts are:

1.) Housing market, crap.
2.) Stock market, crap.

More facts for ya:
http://www.ndol.org/upload_graphics/BP29_economy_chart1.jpg

My house went from 60,000 to 150,000 in worth! HA!

KP1;13522562']Wrong, much?

I find it hard to believe that the economy has not changed when my house has gone from: $1,100,000 in worth to $600,000 since Bush has been in charge.

It isn't that 'damned liberal media' that is portraying things the wrong way, it's just facts. And the facts are:

1.) Housing market, crap.
2.) Stock market, crap.

More facts for ya:
http://www.ndol.org/upload_graphics/BP29_economy_chart1.jpg

Mine has gone up considerably in the last four years and even in the last year has not declined in it's rate of growth. Perhaps your home value has more to do with your community than the President.

Btw your graph wouldn't be a wee bit biased would it?

The Progressive Policy Institute (PPI) is a think tank in the United States, founded in 1989 and affiliated with the Democratic Leadership Council, which styles itself as promoting the ideas of "New Democrats." http://en.wikipedia.org/wiki/Progressive_Policy_Institute

"Suddenly?" Have you been under Iraq a rock?

I don't doubt that during the eighties different income groups experienced different growth rates. But I have a problem with the "at the expense of" because that's a pretty strong assertion that you're not going to be able to support just by pointing at growth rate differentials. So what's your reasoning?
The incomes of the upper classes improved while the lower decreased.
I suppose the two are not necessarily connected; however, as supply-side economics was carried out religiously, it makes me suspect they were.

The incomes of the upper classes improved while the lower decreased.
I suppose the two are not necessarily connected; however, as supply-side economics was carried out religiously, it makes me suspect they were.

Which time period are you speaking about? If you're speaking about the 1990's you're correct. However, if you're speaking about the 2000's America followed a parabolic pattern, with unskilled and undereducated workers at the bottom benefiting from a gain in construction and transportation employment leading to a gain in bottom level pay, along with price drops for some consumer goods, and the wealthy benefited from increased corporate profits. The people who did not benefit at all were those in the middle, who actually saw their AVERAGE income go down, although that's mainly just because a few sectors (the Legal sector the most) saw such huge productivity gains from computing that not as many of them were needed.

Oh, and by the way, economic policy is not a magic wand that you just wave and suddenly everything gets better or worse. Economies follow cycles, and in order to judge an economy or economic system, you need to look at it's performance through MANY of them. It's also not one-dimensional - just because you have lots of economic growth does not mean you will have economic stability, as America proved in the 1800's.

Perhaps your home value has more to do with your community than the President.Oh fucking really?
What does this mean then, bias?:
http://www.mercurynews.com/realestatenews/ci_8487733

For the first time since the Federal Reserve started tracking the data in 1945, the amount of debt tied up in American homes exceeds the equity homeowners have built.

The Fed reported Thursday that homeowner equity actually slipped below 50 percent in the second quarter of last year, and fell to just less than 48 percent in the fourth quarter.
Yes, the mention of the Federal Reserve and the term AMERICAN HOMES MUST mean it's a local community issue.

"Suddenly?" Have you been under Iraq a rock?

Try a different consonant.

I suppose the two are not necessarily connected; however, as supply-side economics was carried out religiously, it makes me suspect they were.
But if you suspect this, you must have some grounds for those suspicions, don't you?

Yes, the mention of the Federal Reserve and the term AMERICAN HOMES MUST mean it's a local community issue.
A reduction from 1.1m to 600k is rather more significant than the average falls in house prices. So yeah, in all likelihood there are a bunch of local factors which made up the bulk of the fall.

Not that George Bush has anything to do with any of this. It's not his fault a housing bubble appeared (blame Greenspan if you need a target) and it's not his fault that people took on loans based on some pretty questionable assumptions. His biggest mistake was that he continued with the line US leaders have been peddling for ages, namely that owning your own home is a necessary part of the American dream, which in turn encouraged people who shouldn't have been wasting their time thinking about mortgages to go looking for them.

I have not heard that tax revenue increases with a decrease in tax rates. In fact, I have heard the opposite, that the '80s tax decreases lowered tax revenue. My source is Economics Explained by Robert Heilbroner, who is admittedly a liberal economist, and Lester Thurow. But if you have contradictory sources, it's possible mine are flawed.

Also, economic growth does not mean economic growth for everyone. Again with the '80s: the economy as a whole grew, but it was the top quintile at the expense of the other four-fifths of the country. (From The Politics of Rich and Poor, by Kevin Phillips.)

Think of it like a really good sale at Target - the store sells considerably more than they ordinarily would by lowering their prices. More sales = more profit, even at lower margins. Look up the laffer curve for more info on this idea.


Not that George Bush has anything to do with any of this. It's not his fault a housing bubble appeared (blame Greenspan if you need a target) and it's not his fault that people took on loans based on some pretty questionable assumptions. His biggest mistake was that he continued with the line US leaders have been peddling for ages, namely that owning your own home is a necessary part of the American dream, which in turn encouraged people who shouldn't have been wasting their time thinking about mortgages to go looking for them.

A better explanation is simple human behavior - particularly greed. People are not very complex. They see something working so they try it. If they get positive results (or observe them) then they do it more. In this case everyone was seeing positive - homeowners, lenders, intermediaries - so they all just did more and more without regard for consequences be4cause they had not observed anything but positive consequences. As soon as a negative consequence occurs the next most natural reaction is to assign blame to someone other than themselves and look for an escape rout - once gain; with little regard for consequence.
The trouble with most people is a complete disconnect with consequence - be it your finances, your diet or your Governor's weekend companion.

Expect Detroit to largely disappear from the map by 2018.
But-- how will we tell? ;)

I think we covered the practical perspective and can conclude that it doesn't confirm things either way.

We didn't. The savings rate slowly dropped. It was supposed to increase. So either it has had little effect or the savings rate would have dropped drastically faster. Do you have any evidence that the savings rate would have dropped significantly faster?


It's not a 100% offset of course. But researchers (Fumo Hayashi, Quarterly Journal of Economics, 1985) have found that the PIH works quite well for about 80% or so of American households while the rest have "liquidity constraints" and therefore can't smooth their spending behaviour according to future expectations, including of things like tax increases.

Anyways, the debate about Ricardian equivalence itself hasn't been settled all that well, though I found this article (http://www.informaworld.com/smpp/content~content=a713757824~db=all) in particular interesting because it seems to cover all the bases.

Did the research show that as Federal debt increased people saved more? Most of what I can find on PIH has to do with

Interest rates had been going up in the US for some time, yet inflation was still increasing (due to the oil price, ethanol subsidies and lots of other reasons). Does that mean monetary policy isn't effective to combat inflation, or does it just mean that its effect was drowned out by other impacts?

It would appear to show that interest rates have little effect when the price level changes due to changes in commodity prices. at least when used timidly, especially if interest rates aren't raised much in real terms given that inflation is increasing.


Compared to where the economy was before, I don't think it gives reason to complain.

Compared to that it performed adequately, but not spectatcularly.

I think the low productivity had as much to do with the private sector (the GMs and Fords and so on) as with policy. The Japanese were flexible, vibrant and kept their costs low while US companies were run according to outdated and dysfunctional business models. If that had to do with it, then there may not have been a lot any government could have done and the economy had to get shaken up by technology and the entrepreneurial opportunities that came along.

Perhaps, but it promised more than it delivered. Do you dispute my claims that supply-siders claimed what I have claimed they said would happen? That the savings rate would increase? That productivity and economic growth would increase? if not, i do not see why you are arguing with me when I use their own claims to judge the effectiveness of their own policies.

We didn't. The savings rate slowly dropped. It was supposed to increase. So either it has had little effect or the savings rate would have dropped drastically faster. Do you have any evidence that the savings rate would have dropped significantly faster?


Do you dispute my claims that supply-siders claimed what I have claimed they said would happen? That the savings rate would increase? That productivity and economic growth would increase? if not, i do not see why you are arguing with me when I use their own claims to judge the effectiveness of their own policies.

I'll make that argument. THe term 'savings rate' you use is undefined. If you wish then I'll provide a definition - the percentage of after-tax income that is not spent - which is what the Beureau of Economic Analysis uses.

Trouble is - it ignores roughly $2.7 TRILLION dollares of US SAVINGS in 401k plans and nearly double that in traditional IRAs.

The savings rate declined about the same time 401k and IRAs were rolled out? Coincidence? No.

Other factors ignored include the principal payments most people are making on their 30yr mortgages. It also does not count Social Security taxes, which are essentially a purchase of a future annuity payment and very very similar to savings.

Also - it double dings people who spend gains from investments. If you buy a stock, it doubles, you sell it, reinvest half and spend the other half - your spending counts but the capital gains is NOT considered in the income determination.

The savings rate has not gone down - the measure of savings has simply become obsolete. You may as well be lamenting the decline of commercial airplanes flying in the US based on the reduction of airplane propellers sold since 1960.

I'll make that argument. THe term 'savings rate' you use is undefined. If you wish then I'll provide a definition - the percentage of after-tax income that is not spent - which is what the Beureau of Economic Analysis uses.

Trouble is - it ignores roughly $2.7 TRILLION dollares of US SAVINGS in 401k plans and nearly double that in traditional IRAs.

The savings rate declined about the same time 401k and IRAs were rolled out? Coincidence? No.

Other factors ignored include the principal payments most people are making on their 30yr mortgages. It also does not count Social Security taxes, which are essentially a purchase of a future annuity payment and very very similar to savings.

Also - it double dings people who spend gains from investments. If you buy a stock, it doubles, you sell it, reinvest half and spend the other half - your spending counts but the capital gains is NOT considered in the income determination.

The savings rate has not gone down - the measure of savings has simply become obsolete. You may as well be lamenting the decline of commercial airplanes flying in the US based on the reduction of airplane propellers sold since 1960.

All measures I know of include IRAs and 401ks as income. Income that isn't taxed but still included in the savings rate.

All measures I know of include IRAs and 401ks as income. Income that isn't taxed but still included in the savings rate.

He makes a extremely good point. I highly doubt most measures take into consideration what he was pointing out. Is there information that proves that they do take into consideration retirement accounts/pensions, SSI?

I'll make that argument. THe term 'savings rate' you use is undefined. If you wish then I'll provide a definition - the percentage of after-tax income that is not spent - which is what the Beureau of Economic Analysis uses.

Trouble is - it ignores roughly $2.7 TRILLION dollares of US SAVINGS in 401k plans and nearly double that in traditional IRAs.

The savings rate declined about the same time 401k and IRAs were rolled out? Coincidence? No.

Other factors ignored include the principal payments most people are making on their 30yr mortgages. It also does not count Social Security taxes, which are essentially a purchase of a future annuity payment and very very similar to savings.

Also - it double dings people who spend gains from investments. If you buy a stock, it doubles, you sell it, reinvest half and spend the other half - your spending counts but the capital gains is NOT considered in the income determination.

The savings rate has not gone down - the measure of savings has simply become obsolete. You may as well be lamenting the decline of commercial airplanes flying in the US based on the reduction of airplane propellers sold since 1960.


Very good points and have not seen it laid out in this manner before. While reading this it dawned on me that you probably hit the main reason for the dip. Goes to show that the answers are sometimes right in front of us.

Think of it like a really good sale at Target - the store sells considerably more than they ordinarily would by lowering their prices. More sales = more profit, even at lower margins. Look up the laffer curve for more info on this idea.
Unfortunately empirical research tends to suggest that the curve turns only at extremely high rates (ie 75%+), and so that the effect of a tax cut on revenue will generally be negative, ceteris paribus.

We didn't. The savings rate slowly dropped. It was supposed to increase. So either it has had little effect or the savings rate would have dropped drastically faster. Do you have any evidence that the savings rate would have dropped significantly faster?
What would such evidence look like?

Did the research show that as Federal debt increased people saved more? Most of what I can find on PIH has to do with
...what?

Anyways, you're still not accepting what I'm saying: empirical results by themselves are generally worthless in macroeconomics. They need to be backed up by some sound piece of theory (or micro-evidence) to create at least some sort of likelihood that a cause and effect relationship exists here.

Anyways:
http://ideas.repec.org/a/taf/irapec/v17y2003i2p209-221.html
http://ideas.repec.org/a/ebl/ecbull/v5y2004i16p1-10.html
http://www.sciencedirect.com/science/article/B6VBV-3VWC643-S/2/5abe372f17edd590d325397150ed9f58

It would appear to show that interest rates have little effect when the price level changes due to changes in commodity prices. at least when used timidly, especially if interest rates aren't raised much in real terms given that inflation is increasing.
Yes, but that's not what I really asked. What I asked is whether the underlying cause-effect relationship between interest rates and inflation doesn't exist or whether it is simply overpowered by forces that act in a different direction.

if not, i do not see why you are arguing with me when I use their own claims to judge the effectiveness of their own policies.
I'm arguing because I'm not sure you understand how macroeconomics works as an academic discipline.

Yes, the policies didn't do everything their advocates said they would. But no, that doesn't mean that the reasoning and arguments of those advocates were actually wrong. It could also mean that perhaps some circumstances they might not have foreseen also had an impact on these variables which masked the effect the policies themselves were having.

He makes a extremely good point. I highly doubt most measures take into consideration what he was pointing out. Is there information that proves that they do take into consideration retirement accounts/pensions, SSI?

They are. Check here (http://www.frbsf.org/education/activities/drecon/answerxml.cfm?selectedurl=/2005/0508.html)

Given the added incentives of IRAs and 401Ks then my arguments are even more convinving I would say.

All measures I know of include IRAs and 401ks as income. Income that isn't taxed but still included in the savings rate.

Actually I stand corrected; personal income includes 401k and IRA contributions, but AGI and Money Income do not;

http://www.bea.gov/regional/pdf/spi2005/alternative_measures.pdf

(To spare yourself a headache take a look at the chart at the bottom right)

Before a Savings Rate can be determined accurate the definition must be properly made.

As you can see by this chart - the personal savings rate according to the BEA has gone both up and down over the last eight years - but took a nosedive right after the Democrats took control of congress... (hehe - as if)
http://www.bea.gov/briefrm/saving.htm

Also worth consideration is that employer sponsored pensions are included - and as pension benefits have been replaced with 401k the 'forced' savings brought on by them has also declined. IT is not that in 1965 people where saving more - it is that they had no choice!

Recent changes to 401k rules which allow employers to automatically enroll people in 401ks stands to have some impact on this - though only if people are prudent enough to leave their 401ks alone.

What would such evidence look like?

I dunno. An increased marginal propensity to save would have been good, but I don't see


Anyways, you're still not accepting what I'm saying: empirical results by themselves are generally worthless in macroeconomics. They need to be backed up by some sound piece of theory (or micro-evidence) to create at least some sort of likelihood that a cause and effect relationship exists here.

Anyways:
http://ideas.repec.org/a/taf/irapec/v17y2003i2p209-221.html
http://ideas.repec.org/a/ebl/ecbull/v5y2004i16p1-10.html
http://www.sciencedirect.com/science/article/B6VBV-3VWC643-S/2/5abe372f17edd590d325397150ed9f58


Yes, but that's not what I really asked. What I asked is whether the underlying cause-effect relationship between interest rates and inflation doesn't exist or whether it is simply overpowered by forces that act in a different direction.


I'm arguing because I'm not sure you understand how macroeconomics works as an academic discipline.

Yes, the policies didn't do everything their advocates said they would. But no, that doesn't mean that the reasoning and arguments of those advocates were actually wrong. It could also mean that perhaps some circumstances they might not have foreseen also had an impact on these variables which masked the effect the policies themselves were having.

Yet without empirical results I dont see how useful it is as a science if theory is all one has. Other variables may have also had effects but then again they may not have. The very fuzziness of macroeconomics should have caused them to be more constrained in their promises.

Think of it like a really good sale at Target - the store sells considerably more than they ordinarily would by lowering their prices. More sales = more profit, even at lower margins. Look up the laffer curve for more info on this idea.

I've heard of the Laffer Curver. It states, more or less, that higher taxes does not necessarily mean higher tax revenue, because people won't try to earn as much and thus make less. In theory, it makes a lot of sense, and it's probably true to a degree. If the tax rate is 0%, the government will obviously make nothing, but a tax rate of 100% could be just as bad.

However, in practice this did not work the way it was intended. Cutting taxes in the 1980s ended up cutting tax revenues.

appeared

Ahem.

I dunno. An increased marginal propensity to save would have been good, but I don't see
You have a habit of not finishing sentences. :p

Anyways, a tax cut is unlikely to see the actual propensity to save change. Propensity is a behavioural parameter, so a change would indicate an actual change in the mind of the consumer. A tax cut is simply putting more money into the consumer's pocket, to which she'll respond according to her marginal propensity to do various things.

Anyways, fixing the US' lack of saving is something a lot of people have been talking about for some time, but it's rather difficult. Seems that no matter what you do, Americans these days prefer consumption today to consumption tomorrow.

Yet without empirical results I dont see how useful it is as a science if theory is all one has. Other variables may have also had effects but then again they may not have. The very fuzziness of macroeconomics should have caused them to be more constrained in their promises.
Well, first of all when you hear economists in public and on the news they become political figures acting in part for political goals. So it wouldn't surprise me if some of Reagan's economic advisors and so on put style before substance.

Secondly, physics for example has a similar problem - indeed pretty much all of human knowledge does. You can have a theory that checks out logically. Then you do an experiment and it checks out empirically (or you do the two the other way round). But you can't be 100% certain that next time you do the experiment the result will be the same. Physical sciences generally have the luxury of being able to repeat experiments and keep them free of external disturbances to the point where eventually you say "okay, I think we can now take this as a rule". And even that is not necessarily correct, as Einstein's big modifications to Newtonian gravity for example demonstrated.

In macroeconomics you can't do experiments. In everything a macroeconomist says, she's constrained by having to say "ceteris paribus". That's a shortcoming as far as the science is concerned, but not one I can see anyone getting around. Microeconomics is more secure (though of course not 100%), which is why the use of microeconomic knowledge to establish and expand macroeconomics is such a good idea.

Anyways, I think it is possible to go a long way towards isolating the effects a policy has on variables if you're any good at econometrics. If you can find me a paper that has some econometric evidence regarding the effects of supply side policies (of course you'd have to talk about specific policies in this case, not just the period during which Reagan happened to be in office), I'd probably accept your assertion. But as it is, I don't think such evidence exists .

Ahem.
:confused:

You have a habit of not finishing sentences. :p

I do. Its more of a tendency to stop and thing when I need some thought for an answer and then I get sidetracked and forget.

Anyways, a tax cut is unlikely to see the actual propensity to save change. Propensity is a behavioural parameter, so a change would indicate an actual change in the mind of the consumer. A tax cut is simply putting more money into the consumer's pocket, to which she'll respond according to her marginal propensity to do various things.

Anyways, fixing the US' lack of saving is something a lot of people have been talking about for some time, but it's rather difficult. Seems that no matter what you do, Americans these days prefer consumption today to consumption tomorrow.

The argument that it would increases the marginal propensity to save is because it increased future consumption to a greater degree than before the tax cut.

Most ways that I've heard of to increase the savings rate are forced savings policies linked is Social Security privitization.

Well, first of all when you hear economists in public and on the news they become political figures acting in part for political goals. So it wouldn't surprise me if some of Reagan's economic advisors and so on put style before substance.

True, and what's even worse is that many of its first proponents were journalists and not economists.

Secondly, physics for example has a similar problem - indeed pretty much all of human knowledge does. You can have a theory that checks out logically. Then you do an experiment and it checks out empirically (or you do the two the other way round). But you can't be 100% certain that next time you do the experiment the result will be the same. Physical sciences generally have the luxury of being able to repeat experiments and keep them free of external disturbances to the point where eventually you say "okay, I think we can now take this as a rule". And even that is not necessarily correct, as Einstein's big modifications to Newtonian gravity for example demonstrated.

Yeah, I know. I was talking to Europa_ Maxima one time arguing over the Austrian school's dislike of empiricism. Then he told me how one needed a theory just to make sense of economic information, unlike physics. I asked him he ever talked to a physicist before since any one of them would say the same thing about their experimental data.

In macroeconomics you can't do experiments. In everything a macroeconomist says, she's constrained by having to say "ceteris paribus". That's a shortcoming as far as the science is concerned, but not one I can see anyone getting around. Microeconomics is more secure (though of course not 100%), which is why the use of microeconomic knowledge to establish and expand macroeconomics is such a good idea.

True, but macronomics does not totally eschew empiricism. Stagflation brought great changes to the discipline, after all.

Anyways, I think it is possible to go a long way towards isolating the effects a policy has on variables if you're any good at econometrics. If you can find me a paper that has some econometric evidence regarding the effects of supply side policies (of course you'd have to talk about specific policies in this case, not just the period during which Reagan happened to be in office), I'd probably accept your assertion. But as it is, I don't think such evidence exists .

I'm guessing there are probably a number of papers both supporting and disputing my assertion, but I dont care to look for them at the moment.

I am not sure that the economy is doing poorly. If it is, well I am kinda glad just because that this is the motivation of the Fed to lower the interest rate and this seems to be lowering mortgage interest rates and I want to refinance. Also, I love it when the stock market drops because since I am young I am a buyer of stocks and not a seller of them (sort of because I buy them in my retirement fund mainly through mutual funds which are kinda always buying and selling positions within the fund).

I am not sure that the economy is doing poorly. If it is, well I am kinda glad just because that this is the motivation of the Fed to lower the interest rate and this seems to be lowering mortgage interest rates and I want to refinance. Also, I love it when the stock market drops because since I am young I am a buyer of stocks and not a seller of them (sort of because I buy them in my retirement fund mainly through mutual funds which are kinda always buying and selling positions within the fund).


Dropping the interest rate now will make it rise more later. These guys did not learn a damn thing from the 70's. We are going to be hosed later for all of this bullshit the Fed is pulling. As far as the stock market goes agriculture commodities are the thing right now.