+ Reply to Thread
Page 1 of 3 123 LastLast
Results 1 to 15 of 42

Thread: Crack heads on wall st.

  1. #1
    Join Date
    Mar 2006
    Location
    On the high seas
    Posts
    607

    Default Crack heads on wall st.

    I've been hearing alot of opinions of the crisis on wall st. lately,of course. The analyists are saying that the bailout is providing funds to people who are using it to buy out other weaker enities something that it was not meant to do. I think the feds have provided some more crack money to the addicts on wall st once again. We are in deep trouble with this news and will pay for it for years to come. blackchipjim
    " That we may meet in a better place after this!"

  2. #2
    Join Date
    Mar 2007
    Location
    posting from Bethesda, MD
    Posts
    13,912

    Default

    Quote Originally Posted by blackchipjim View Post
    I've been hearing alot of opinions of the crisis on wall st. lately,of course. The analyists are saying that the bailout is providing funds to people who are using it to buy out other weaker enities something that it was not meant to do. I think the feds have provided some more crack money to the addicts on wall st once again. We are in deep trouble with this news and will pay for it for years to come. blackchipjim
    The thing is, is the natural punishment they would receive enough? It may be enough to punish the guilty parties, but that is not what is important to me. I do not think the natural consequences would be enough to prevent it from happening again and again. This being the case, shouldn't we be thinking about what can be done to prevent it from happening again? Free enterprise clearly cannot be allowed to be completely free. Time and time again it has shown us that it cannot be trusted when great sums of money are for the taking. I am not a socialist. But after such debacles it is hard to be a complete capitalist either. We need enough regulation of free enterprise to keep it honest, and as little regulation as to keep to free. We are becoming a limited capitalist state. We must guard against becoming a complete socialist state. Regulation, not ownership, seems to be the proper course, and great care not to wreck the ship in steering this new direction.
    Aslan 11/1/90 - 6/15/10 Stormy 1/22/95 -8/23/10
    “There are not one hundred people in the United States who hate The Catholic Church,
    but there are millions who hate what they wrongly perceive the Catholic Church to be.”
    Bishop Fulton J. Sheen

    “It takes a very long time to become young.” Pablo Picasso

  3. #3

    Default My interpretation of the bailout

    A group of friends gather together $100,000 and give it to friend A, the investor. The investor gives the money to friend B, the bank. The bank keeps the $100k as reserve and using fractional reserve banking and the money multiplier loans out $900,000 to friend C, the borrower. Logistically this may take a few more people but the principle is the same. Friend C uses the $900k in his account to go to the nearest casino and bets it at the roulette wheel. 2 scenarios can occur:

    Scenario 1) Friend C wins. The group of friends just made $900,000 on a $100,000 investment. They can store some away and repeat the plan again.

    Scenario 2) Friend C loses. Both the borrower and the bank declare bankruptcy. The origional $100k is protected though because it is federally insured.

    Now replace the word “federally insured” with the words “government bailout,” the number “100 thousand” with the number “700 billion” and the word "roulette" with the words “market deriviative” and I think you get a pretty good description of what happened on Wall Street. The government is literally buying out gambling debts of degenerate gamblers made with borrowed money that never existed.

    But wait that’s not all! As one final kick in the balls the government will pay for this by borrowing more money that we’ll have to pay interest on despite the fact that this money was also created ficticiously by the fractional reserve system and that the only real money being borrowed is that held in reserve by our accounts. The government is literally making us pay interest on our own money so that it can pay back the gambling debts of banks that are charging us interest. We are being charged to give banks money!

  4. #4
    Join Date
    Mar 2006
    Location
    On the high seas
    Posts
    607

    Default analogy

    To put in prespective of what this jerks are doing is thus. I am defaulting on my mortgage and have a little gambling debt on the side. My rich uncle sam gives me money to help me out and I go out and buy the house across the street that was foreclosed in an auction. I know that when the market goes back up i'll really make out. I also take some of the money and parlay it to pay off my gambling debt. That is what this people on wall st are in the process of doing. These guys have begun the ripoff before the safe guards were in place. I have never thought that having foxes watch the hen house was or ever will be a good idea. blackchipjim
    " That we may meet in a better place after this!"

  5. #5

    Default

    The government is literally making us pay interest on our own money so that it can pay back the gambling debts of banks that are charging us interest. We are being charged to give banks money!
    Don't worry. They are working very hard to make sure the tax rate paid by the people getting this huge taxpayer winfall is kept low. God forbid rich wall street bankers should pay a higher rate on their earnings.

  6. #6
    Join Date
    Mar 2007
    Location
    posting from Bethesda, MD
    Posts
    13,912

    Default

    Quote Originally Posted by Guynoire View Post
    But wait that’s not all! As one final kick in the balls the government will pay for this by borrowing more money that we’ll have to pay interest on despite the fact that this money was also created ficticiously by the fractional reserve system and that the only real money being borrowed is that held in reserve by our accounts. The government is literally making us pay interest on our own money so that it can pay back the gambling debts of banks that are charging us interest. We are being charged to give banks money!
    Well, the money isn't exactly fictitious. The government must sell its own securities and bonds to print/raise the money, so there is the promise on the part of government to pay someone something in return plus interest. Unfortunately, we are the government, or maybe the lack thereof [government] would be more precise.
    Last edited by aslan; October 23rd, 2008 at 05:53 PM.
    Aslan 11/1/90 - 6/15/10 Stormy 1/22/95 -8/23/10
    “There are not one hundred people in the United States who hate The Catholic Church,
    but there are millions who hate what they wrongly perceive the Catholic Church to be.”
    Bishop Fulton J. Sheen

    “It takes a very long time to become young.” Pablo Picasso

  7. #7

    Default

    Greenspan admitted today that he made a mistake not having the financial markets regulated more to prevent this thing from happening. I give him props for having the balls to do that.

  8. #8

    Default

    Quote Originally Posted by aslan View Post
    Well, the money isn't exactly fictitious.
    Yes it is, totally. zg
    "The dogs bark but the caravan moves on."
    .....................The Zengrifter Interview (PDF) |
    The Zengrifter / James Grosjean Reputation Debate
    -----------------------------------------
    “Truth, like gold, is obtained not by growth, but by washing away all that is not gold.” — Leo Tolstoy........
    "Is everything a conspiracy? No, just the important stuff." ZG

  9. #9
    Join Date
    Mar 2007
    Location
    posting from Bethesda, MD
    Posts
    13,912

    Default

    Quote Originally Posted by zengrifter View Post
    Yes it is, totally. zg
    The government borrows money by selling bonds. The government does not create money.
    Aslan 11/1/90 - 6/15/10 Stormy 1/22/95 -8/23/10
    “There are not one hundred people in the United States who hate The Catholic Church,
    but there are millions who hate what they wrongly perceive the Catholic Church to be.”
    Bishop Fulton J. Sheen

    “It takes a very long time to become young.” Pablo Picasso

  10. #10

    Default

    Quote Originally Posted by aslan View Post
    The government borrows money by selling bonds. The government does not create money.
    Bullshit - the M-3 supply printing presses now run with NO ACCOUNTABILITY. zg
    "The dogs bark but the caravan moves on."
    .....................The Zengrifter Interview (PDF) |
    The Zengrifter / James Grosjean Reputation Debate
    -----------------------------------------
    “Truth, like gold, is obtained not by growth, but by washing away all that is not gold.” — Leo Tolstoy........
    "Is everything a conspiracy? No, just the important stuff." ZG

  11. #11
    Join Date
    Mar 2007
    Location
    posting from Bethesda, MD
    Posts
    13,912

    Default

    Quote Originally Posted by zengrifter View Post
    Bullshit - the M-3 supply printing presses now run with NO ACCOUNTABILITY. zg
    I can't agree with that.
    Aslan 11/1/90 - 6/15/10 Stormy 1/22/95 -8/23/10
    “There are not one hundred people in the United States who hate The Catholic Church,
    but there are millions who hate what they wrongly perceive the Catholic Church to be.”
    Bishop Fulton J. Sheen

    “It takes a very long time to become young.” Pablo Picasso

  12. #12

    Default

    Quote Originally Posted by aslan View Post
    I can't agree with that.
    Of course you can't, but this is not an opinion. zg
    "The dogs bark but the caravan moves on."
    .....................The Zengrifter Interview (PDF) |
    The Zengrifter / James Grosjean Reputation Debate
    -----------------------------------------
    “Truth, like gold, is obtained not by growth, but by washing away all that is not gold.” — Leo Tolstoy........
    "Is everything a conspiracy? No, just the important stuff." ZG

  13. #13
    Join Date
    Mar 2007
    Location
    posting from Bethesda, MD
    Posts
    13,912

    Default

    None of this makes money fictitious. The fact that the money supply M3 is increasing does not mean it is fictitious. You say no accountability--I say irresponsibility. I share your concern that the government is too deeply in debt. I share your concern that government spending is out of control. I even share your concern that the wage productivity gap is too wide.

    Government needs to live within its means and that means it needs to stop borrowing from Peter to pay Paul. The government needs to stop favoring rich cronies, and that means some pretty drastic reform in Washington is in order.
    Aslan 11/1/90 - 6/15/10 Stormy 1/22/95 -8/23/10
    “There are not one hundred people in the United States who hate The Catholic Church,
    but there are millions who hate what they wrongly perceive the Catholic Church to be.”
    Bishop Fulton J. Sheen

    “It takes a very long time to become young.” Pablo Picasso

  14. #14

    Default

    Quote Originally Posted by aslan View Post
    Well, the money isn't exactly fictitious.
    The reason why the money is fictitious is because banks loan out the same money over and over again. If you put $1000 dollars in a bank the banks will loan out that $1000 9 times and charge interest on all $9000 of it. When the government prints money it just compounds the problem because banks will loan out 9 times what the government printed. This is known to economists as the money multiplier and it's the main reason why we have such large fluctuations in the expansion and contraction of the money supply. It's a positive feed back system, a small ripple can trigger a major collapse.

  15. #15
    Join Date
    May 2006
    Location
    Connecticut
    Posts
    1,347

    Default Commercial banking system

    Quote Originally Posted by Guynoire View Post
    The reason why the money is fictitious is because banks loan out the same money over and over again. If you put $1000 dollars in a bank the banks will loan out that $1000 9 times and charge interest on all $9000 of it. When the government prints money it just compounds the problem because banks will loan out 9 times what the government printed. This is known to economists as the money multiplier and it's the main reason why we have such large fluctuations in the expansion and contraction of the money supply. It's a positive feed back system, a small ripple can trigger a major collapse.
    The commercial banking system has worked pretty well under ordinary circumstances and when it's used in accordance with economic principles and not for effecting social policy.

    There is a ratio of deposits to loans banks have to maintain (that money multiplier) but due to technology and interest rates there is no reason for the average person to keep money in a savings account or bank CD's anymore. Who needs the 1% they will pay you? Also due to the speed and efficiency of online banking transactions people don't need to keep a sum in the bank as a buffer. If I need to pay a bill, I can drive down the street, deposit cash in the BofA ATM and pay the bill online within minutes.

    The jury is still out on the FM/FM collapse but it seem apparent they were rampantly making loans to people who should have been renters. From my personal experience, I remember getting a mortgage back in 1999. I was a well-paid professional with a long and solid work history looking to buy an inexpensive condo, and it was very difficult for me to find a lender. The reason: I made too much money! I was a first time buyer, and I had to compete in the same open markets with much wealthier people who already owned real estate. The mortgage broker confided to me that if my income was half as much, I'd have no problem getting the mortgage because I'd qualify for Federal programs. Whether or not I'd be able to pay that mortgage was less of an issue than qualifying for the program.

+ Reply to Thread

Similar Threads

  1. Doctor Heads List of Wanted Nazis
    By Brutus in forum ZenZone General Discussion
    Replies: 20
    Last Post: July 11th, 2008, 10:38 AM
  2. Obama Charged With Gay Sex And Crack
    By zengrifter in forum ZenZone General Discussion
    Replies: 43
    Last Post: March 10th, 2008, 11:35 PM
  3. Gizmondo's Spectacular Crack-up
    By zengrifter in forum ZenZone General Discussion
    Replies: 2
    Last Post: October 18th, 2006, 04:03 PM
  4. Cops Crack Down On Striptease Funerals
    By zengrifter in forum ZenZone General Discussion
    Replies: 0
    Last Post: August 24th, 2006, 01:12 PM
  5. Helmet Heads
    By Mikeaber in forum ZenZone General Discussion
    Replies: 4
    Last Post: June 6th, 2006, 02:52 PM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts