Here's a transcript from The Glenn Beck Show. He's talking to Bob O'Brian ( Editor of Barron's Online ) about the economy:
BECK: We`re running out of bullets. The Fed is going to make another rate cut tomorrow. They did two massive things last week. And it doesn`t really matter. They`re just pumping more money into it. When do they run out of bullets?
O`BRIEN: The market seems to suspecting that we`re going to see a 100-basis-point cut in the federal funds rate tomorrow. That will take you down to 2 percent. I mean, you know, do you want to enter a circumstance like the one that took place in Japan for most of the 1990s, where effectively real interest rates were in the negative? I don`t think the Fed wants to do that, they`re getting pretty close to having -- having emptied the -- emptied the holster here.
SCHIFF: But it`s not a sense of running out of bullets. They`d been shooting blanks the whole time.
The problem isn`t that Americans aren`t spending enough money. The problem is, we spent too much money. These cures is designed to try to get us to spend more.
You know, Glenn, when you mentioned at the top of the hit that our economy is the engines of consumer spending, it`s not. The engine of economic growth is consumers not spending. It`s savings. That`s what drives the economy. That`s why our economy is phony.
We`re just like Bear Stearns. Bear Stearns went under because they had too much debt. Well, our entire country has too much debt, and we can`t pay it back, just like Bear Stearns.
G.
Originally posted by AThousandYoungSo you didn't agree with Bush's tax cuts then?
But I don't have anything to gain. "The Economy" - a vague abstraction - supposedly does. It's like saying "donate money to the rich...it's good for America." WTF?
.
Personally I think running a system according to consumer capitalist principles is fundamentally flawed. At the most basic level its wasteful, not only of resources but also in terms of its environmental impact. When this is married to a debt is good philosophy then in my opinion you have all the makings of a massive meltdown, the mother of all depressions.
Its just that not many people in America seem ready to want to talk about anything other then letting the market decide. The minute anyone mentions putting constraints in place to order the economy, then all the libertarians and their ideologically aligned acolytes, scream communist and shout down any notion that the market needs to be controlled. However as you and I and everyone with common sense can see that spending your way out of recession is a flawed proposition because the mountain of debt that accumulates will at some point trigger a correction that will usher in the mother of all depressions.
My stance in this argument has been based on a judgment call of the perceived lack of will by the American people and their economic policy makers to adapt their system and walk away from the model of the market decides everything. If this is the reality that America would rather go broke than have bureaucrats and economists micro and macro manage everything instead of the laissez faire model that seems to be writ large in stone, then my argument suggests that the lesser of two evils would be to spend until it hurts, and find a few more wars to balance the books.
Other than that, when the American people are ready to take the economic medicine of a long put off correction and then maybe look at some legislation that limits the sort of debt leveraging that has become so popular with the private equity bogeymen like KKR and have Government lead by example and start with a program of economic transparency and surplus budgets (reduce military spending by whatever percentage that would make this possible) and then maybe just maybe sutainable growth can become a feature of modern civilized society.
Originally posted by whodeythe key phrases are "budget process" and "Republican Revolution".
Ok, I will give him his props. Clinton payed down a little bit of the debt, however, the key word here is a "little".
bye the bye, why did so many Democrats vote against the Fiscal Responsibility Act?
---
http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=104&session=1&vote=00098
Measure Title: A joint resolution proposing a balanced budget amendment to the Constitution of the United States.
NAYs ---35
Akaka (D-HI)
Bingaman (D-NM)
Boxer (D-CA)
Bradley (D-NJ)
Bumpers (D-AR)
Byrd (D-WV)
Conrad (D-ND)
Daschle (D-SD)
Dodd (D-CT)
Dole (R-KS)
Dorgan (D-ND)
Feingold (D-WI)
Feinstein (D-CA)
Ford (D-KY)
Glenn (D-OH)
Hatfield (R-OR)
Hollings (D-SC)
Inouye (D-HI)
Johnston (D-LA)
Kennedy (D-MA)
Kerrey (D-NE)
Kerry (D-MA)
Lautenberg (D-NJ)
Leahy (D-VT)
Levin (D-MI)
Lieberman (D-CT)
Mikulski (D-MD)
Moynihan (D-NY)
Murray (D-WA)
Pell (D-RI)
Pryor (D-AR)
Reid (D-NV)
Rockefeller (D-WV)
Sarbanes (D-MD)
Wellstone (D-MN)
http://en.wikipedia.org/wiki/Early_2000s_recession#United_States
"United States
The U.S. economy shrank in three non-consecutive quarters in the early 2000s (the third quarter of 2000, the first quarter of 2001, and the third quarter of 2001). Strictly speaking, the U.S. economy was not in recession during this period -- the common definition being "a fall of a country's real gross domestic product in two or more successive quarters."
Those using less traditional definitions of the term deem part or all of this period to have been a recession and there remains some debate over the start and end dates. The initial report by the National Bureau of Economic Research (NBER) declares a recession that lasted from March 2001 to November 2001 (Someone add an application of an AD-AS model for ECO 202), as real gross domestic product dropped during this period by 0.2% total from the fourth quarter of 2000. However, even this definition is in doubt. Several members of NBER's business cycle dating committee have said that revised data indicates a recession actually began some time within the final months of 2000. Committee members suggest they are inclined to move the date.[1] NBER President Martin Feldstein said:
"It is clear that the revised data have made our original March date for the start of the recession much too late. We are still waiting for additional monthly data before making a final judgment. Until we have the additional data, we cannot make a decision."[1]
Controversy over the precise dates of the recession led to the characterization of the recession as the Clinton Recession by Republicans, if it could be traced to the final term of President Bill Clinton. A move in the recession date in a 2004 report by the Council of Economic Advisors to several months before the one given by the NBER was seen as politically motivated.[2]
Using the stock market as a benchmark, a recession began in March 2000 when the NASDAQ crashed following the collapse of the Dot-com bubble. The Dow Jones Industrial Average was relatively unscathed by the NASDAQ's crash until the September 11, 2001 attacks, after which the DJIA suffered its worst one-day point loss and biggest one-week losses in history. The market rebounded, only to crash once more in the final two quarters of 2002. In the final three quarters of 2003, the market finally rebounded permanently, agreeing with the unemployment statistics that the recession lasted from 2001 through 2003.
"
Originally posted by rookedpawnRaising taxes can absolutely stall spending, and by curtailing demand you end up with an oversupply and all your wholesalers take an absolute bath. Slashing spending, especially military spending allows Government to build infrastructure with that money and increase capacity within the economy so that growth can be sustained without the economy overheating.
Anybody can "balance" the budget by raising taxes high enough.
Instead of any tax hikes to limit spending or tax cuts that increase spending Government could stabilize the economy by encouraging savings, by introducing a co contribution savings scheme that allows anyone who saves a certain percentage of their income to get a kicker by Government limited to an affordable ceiling. If increasing savings will ease the demand for credit by the banks then if the co contribution by the Government can be funded by military spending cuts, then it would be win win for market fundamentals.
EDIT: A tax credit for those wanting to buy homes wouldn't hurt either. And if the 30 year mortgage rate could move downwards, a rate that hasn't felt the impact of the Fed's recent round of decreases then maybe if the rot in housing deflation can be halted by a successful stimulation of the housing market, then who knows?
Originally posted by kmax87I'm generally in favor of tax cuts. I haven't looked into these specific ones. Why do you ask this question?
So you didn't agree with Bush's tax cuts then?
Personally I think running a system according to consumer capitalist principles is fundamentally flawed. At the most basic level its wasteful, not only of resources but also in terms of its environmental impact. When this is married to a debt is good philosophy then in my opinion you have all the makings of a ...[text shortened]... and then maybe just maybe sutainable growth can become a feature of modern civilized society.
Originally posted by kmax87A tax credit for those wanting to buy homes wouldn't hurt either.
Raising taxes can absolutely stall spending, and by curtailing demand you end up with an oversupply and all your wholesalers take an absolute bath. Slashing spending, especially military spending allows Government to build infrastructure with that money and increase capacity within the economy so that growth can be sustained without the economy overheating. ...[text shortened]... ng deflation can be halted by a successful stimulation of the housing market, then who knows?
Entirely unnecessary if the government doesn't prop up homeowners and keep the prices of homes artificially high. Homes should be real cheap right now!
Originally posted by AThousandYoungSo housing going into a deflationary spiral is good?
[b]A tax credit for those wanting to buy homes wouldn't hurt either.
Entirely unnecessary if the government doesn't prop up homeowners and keep the prices of homes artificially high. Homes should be real cheap right now![/b]
Originally posted by AThousandYoungSo when the market collapses around your ears because there's no return in property for the big investors and although you have a house there is no economy to speak of, how will you feel when you may have to sell off your investment for less than you bought it 3 years down the track because the market that you say you care little about has had such a downturn that you lose your job and the one thing you were told all your life that had value, houses and land, actually devalued over time, and you had to offload it onto some other starry eyed hopeful that jumped at an apparent bargain they would be extremely lucky to hold on to?
For those with a job but without property, yes.
Falling land and property prices can not be good for any economy in the long term.
Its usually a good indicator of the general health of the nations finances also. take that away from an economy and then how does an ordinary person build up any measure of wealth or security?
Originally posted by kmax87I dunno about all that. All I know is that as the economy collapsed, I'd have a roof over my head...permanently. I wouldn't be selling it. That's dumb.
So when the market collapses around your ears because there's no return in property for the big investors and although you have a house there is no economy to speak of, how will you feel when you may have to sell off your investment for less than you bought it 3 years down the track because the market that you say you care little about has had such a downturn ...[text shortened]... rom an economy and then how does an ordinary person build up any measure of wealth or security?
There are always ways to get food. Food and a roof...what else do you need? A rifle to protect it I suppose.
Originally posted by AThousandYoungIf you can settle the mortgage on a house in three years more power to you, but the truth is that most people would take between 12 to 20 years to pay off a home. Selling it in three years may be a reality for some who buy cheap now. If the market has devalued further and they are forced to sell because they can't keep up with their mortgage payments then they would actually have lost money and maybe be in an even worse position than had they simply thrown away their money as rent.
All I know is that as the economy collapsed, I'd have a roof over my head...permanently. I wouldn't be selling it. That's dumb.
Originally posted by kmax87Umm...that's why you don't buy a house you can't afford. You don't go with variable payments and no rate cap. That's what happened this last time; the variable payments.
If you can settle the mortgage on a house in three years more power to you, but the truth is that most people would take between 12 to 20 years to pay off a home. Selling it in three years may be a reality for some who buy cheap now. If the market has devalued further and they are forced to sell because they can't keep up with their mortgage payments then the ...[text shortened]... ey and maybe be in an even worse position than had they simply thrown away their money as rent.
Originally posted by shavixmirHahahahaha, i feel guilty laughing at this 😳
Yah... maybe in the 30's or something!
You don't have industry any more. You import more than you export, more money flows out of your country than into it.
All the US has become is a nation of fake tits, heavy beer guts, buying ever more crap they don't need and being spoon fed fat 10 times daily.
Go on Dr. Phil... help these poor people!