Don't Understand Why We Are In A Global Depression? Read This Thread.

reply to post by projectvxn


I agree. I think it is good for China to rise as an economic competitor against the U.S.. We need economic competitors to keep us on our toes. Competition is good. I also like seeing the rise of the Europeans Union. I think Eastern Europe has great untapped potential. I also continue to have hopes for Brazil.

reply to post by poet1b


No reason to go calling people names friend, please keep it civil.

reply to post by Tentickles


zeitgeist and all the other FED/history of banking/fractional reserve lending CRAP movies DO NOTHING but make people CONTINUE the BLAME GAME.
listen to me people.

the FUALT lies NOT with the SYSTEM or the ELITE or the BANKERS who are NICE enough to loan out MONEY.
the FUALT LIES IN THE MASSSES.

the masses take out loans WILLINGLY that they cant pay back. they are NOT RESPONSIBLE.
the masses are...
LAZY (coz they dont want to work, rather get a free lunch=loan)
GREEDY (they want MORE than they need..and fast (lazy))
DELUSIONAL (coz they THINK they can pay money back that they could NEVER in the first place)
and
THEY FEEL ENTITLED (the masses FEEL entitled to THINGS without working for it "I was born so I DESERVE that house" NO U FREAKIN DOnt. WORK hard, earn, SAVE and maybe u can afford it.

NO one put a gun to the head of the masses and said "take out a loan"

but yet they STILL COMPLAIN. its THEIR fault and u STILL complain and try to blame it on the people who are responsible(elite).
EVERYONe who has a house SHOULD THANK the banks for lending them money.

YOu all get MIXED up in the WHY instead of focusing on HOW this mess happened. this mess happened coz the masses are IRRESPONSIBLE, LAZY, GREEDY, and DELUSIONAL.

reply to post by MrJelly


You need to spend more time doing research. This isn't about the blame game this is about helping people understand the mechanics of the crises and why/how it is happening.

[edit on 9-4-2009 by projectvxn]

reply to post by MrJelly


Sir, please read the first to paragraphs of my original post. This thread is to help people understand how and why we are in an Economic Depression.

Now to your blame game comments: Blaming other people for your own problems is pretty much the norm in our current times. You have to realize though that the issue is more complicated than just the "masses" as you called them blaming and being at fault. You say the people are at fault solely. They are not.
The blame goes all up and down the poles of power. From the man getting a welfare check the the President himself.
Firstly, the government lowered the regulation on the Stock Markets and insurance industry during Clinton's time in office.
Secondly, the government decided to make owning a home the basis of all wealth for the middle class family.
Thirdly, the insurance agencies knowingly gave out fraudulent contracts and mortgages to people who they knew wouldnt be able to pay.
Finally, the bubble burst and people started to blame this that and the other thing for what happened.

In some small/large way, even you sir are at fault.

reply to post by Tentickles


You are going after the wrong person. I only responded with the same that had been shot at me earlier. You might want to be a little more fair in your response.

reply to post by MrJelly


Seems to me that all your post does is play the blame game, and poorly at that.

The Masses did not take out loans that they could not afford, only a small percentage of people, while a majority of the investment banking companies did loan money to people who could not afford to pay that money back, of course collecting their commissions and bonuses all the way.

Nobody put a gun to these institutions heads forcing them to make these loans.

A threat was made that our economy would be destroyed if the masses did not bailout these banking institutions.

Yeah, these investment banking institutions should be held responsible for their actions.

reply to post by poet1b


I'll say it again. Consumers can't spend because credit is tight. Otherwise, everything is fine. So no, it has nothing to do with how the monetary system operates, through a fractional reserve banking system. There is nothing inherently wrong with it. And I don't care if you were talking about China; I brought up Canada for a very important point, which you chose to ignore, and that is: how they dealt with the U.S. recession through sound monetary policy by keeping interest rates high, maintaining a floating reserve ratio, creating tax free savings accounts, and not engaging any subprime borrowing whatsoever. Re-read my post. It's not the nature of the monetary system itself that is at fault here. It's much simpler than that.

I did also happen to mention the problem created by highly subsidized multinational corporations originating in the U.S. I wasn't arguing with you. The world would be better off if the third world faced significantly lower market barriers, but that has nothing to do with the recession we're currently in. This all has to do with the financials, nothing else. Get it through your head.

[edit on 9-4-2009 by cognoscente]

reply to post by cognoscente


And I will say this for the last time, people don't need credit to spend, they need income. Over extension of credit has only made our current economic problems worse, and it the reason why banks are failing. You either get it, or you don't.

Originally posted by cognoscente
reply to post by poet1b

 

I'll say it again. Consumers can't spend because credit is tight. Otherwise, everything is fine. So no, it has nothing to do with how the monetary system operates, through a fractional reserve banking system. ........... It's not the nature of the monetary system itself that is at fault here. It's much simpler than that.

........ This all has to do with the financials, nothing else. Get it through your head.

[edit on 9-4-2009 by cognoscente]

Cognoscente;

GEE and WHY is credit tight.........because everything is Fine? or because the monetary system is unstable....in the way that fractional reserve banking WITH INTEREST compounds debts greater than the ability for the debtors to ever re-pay......which typically ends with either the creditors getting the chips or the debtors (enjoying a debt writedown or jubilee) when the debt overhang becomes to heavy

do you think that credit is tight because there is no money to lend? (well they deregulated the whole system to grow debt and chase short term proftis) and then when that shadow banking system (securitization which stunk of fraud) collapsed (loans dried up) and the Gov't comes into to try and make up for that debt growth......But do you think any private institution that may try and make money would be interested in lending with growing unemployment and falling consumer earnings.....(not when they can't pass the risk to some other party thru securitization)

.....If the govt's had issued their own currency without interest...there would be no gov't debt ....never mind a compounding of the debt from interest......but WIth central banks in nearly every country in the world that is not going to change......and yes gov'ts would still debase their currency's.....so anyway this is a mute point

Poet;

We practically have Global Fascism .....Big Corporations have a large amount of political influence and they are focused on their individual business bottom line.......their lobbyists have deep ties with gov'ts. At a time of rising unemployment ...weakened unions...and poor earnings..WAGE INFLATION is not happening any time soon!
The other "solution" is to write down the debt..........either reduce the value of the debt and give the bondholders (i.e insiders) huge haircuts.....or devalue the dollar and other currency's against gold (like most country's did to promote GDP growth out of the great depression)

I do agree that the China holding the most treasury bond's of any country is OVERHYPED because they only hold a single digit total amount of our total debt......so yes our huge consumption has actually created a job's bubble over there and the gains in assets worldwide (bonds, stocks, houses) that the central banks engineered allowed consumers worldwide to borrow against illusionary asset gains...now those assets fell and with it consumption.....China going forward is going to have a serious problem when consumption world wide declines for a LONG TIME and their unemployment rate soars......they will likely need to keep giving more and more bailouts to their citizens



[edit on 10-4-2009 by cpdaman]

well open your eyes & you might see the truth for yourself if you believe all the what movies & the media are telling you then your educating yourself with what some producer has chosen for your to see & hear. my theory is that the global economy is a sham i mean who cares what other countries are doing seriously, if anything it's a way for our government to divert attention elsewhere to save their asses for since people are quickly realizing their money & businesses have been robbed. now that is the goal of the Illuminati if im not mistaken is to gain power through wealth but now since 911 people are onto them & their quickly trying to divert attention to some bs overseas market blehhhhhhhh! right? well it doesn't stop there & it's time to just know that & realize it because i can almost guarantee that when there's just a couple stores out there for people to shop in the prices will be sky high.now if worse comes to worse in which people start to loot their stores they will try to maintain order through it by saying that people need a more vast global economy.which imo there no way on God's earth people will buy into.since that bs =a society unreliant on cash (which ive never met anyone who's willing to give up theirs by any means btw). ok now the reason that & here the real kicker but the reason that our economy is in such bad shape is because that the goals of 911 were not met by the illuminati in otherwords they did not gain the control they desired people did not buy into it & people did not want to go out & buy new uneeded crap like they were expecting.people were just trying to get by & so the government with it's last leg to stand on now is draining the economy in an attempt to control the money people have so let me tell ya to not believe these people they are insane they are greedy & this is their last shot once this fails for them then they are going to be dealing directly with God on this matter.then again it could just be a recession.

Originally posted by projectvxn
reply to post by MrJelly

 

You need to spend more time doing research. This isn't about the blame game this is about helping people understand the mechanics of the crises and why/how it is happening.

[edit on 9-4-2009 by projectvxn]

Your initial post was right in only one respect economic war - the rest was, at best misguided.

Short memories around here - I will go over this for you all again - its simple and concrete.

The war has been about oil for the last 60+ years and is now more so than ever. Power is of course the ultimate prize - derived through the control of oil.

The rise of China had to be combated - when China returned the downed spy plane in parts, in boxes, to the US it was a sign of we know everything. When China shot down their satellite it was a sign that they can completely blind America when push comes to shove - China has been gaining support in countries such as Venezuela, Iran, and we all know about Africa and of course Russia. This left America with Iraq as the next best place for oil and so they went in to secure the US oil supplies - and they failed - the shia were smashing the US troops and the media war was being lost thanks to the fact that this is largely a PERSIAN state - hence Iran negotiated with the US to end the uprisings, prevent further troop losses on the proviso that the US would withdraw. America lost their hope for oil reserves. What next ? A pathetic attempt to regain control of the Caspian area failed miserably and so left the US with one option - economic warfare.

The greatest threat facing social continuum is probably peak oil - the cost of everything is intrinsically linked to the cost of oil - so when the price was driven through the roof to $140+ a barrel the world was always going to go into depression - FACT. Almost immediately the effects were felt with protests from Portugal to riots in England. The idea was to drive down consumption which would be felt most dramatically by the Chinese.

The Chinese purchase of bonds was insurance against this.

The unfortunate side effect of this massive and deliberate spike in oil (via the IMF) was to massively empower Iran, Russia and Venezuela by tripling their incomes. The next consequence of applying the brakes to consumption was that the speculative prices of realestate no longer continued up - and so the bubble burst and backfired on the US.

The greatest blow back has been in the fact that China has used its surplus funds NOT to assist the west (as they literally BEGGED them to) but to purchase and stock pile commodities - shrewd in deed. This has allowed them to force down the annual prices of ore, etc which are set annually and will there fore take years to recover. They have then leveraged themselves to stimulate their own economy via increased stimulus to regional Chinese. Next they will be relying on the HUGE reserves of private wealth held by the chinese corporate sector (something almost NEVER discussed).

Hence the Chinese have no need to rely on a western consumer led recovery but rather on a Chinese emerging consumer / middle class led recovery meaning the entire shift of global economic activity is to Asia -

The Americans have been absolutely out manoeuvred - totally - the double blow comes from the fact that China has maintained a neutral stance with countries such as Iran - which the US assumed would remain subdued through depressed oil prices, however as Asia emerges as an Autonomous economy (not reliant on the west) the price of oil will rise through eastern demand stripping the west of access to cheap oil while REMAINING in depression.

That is where the war has been waged -

The only comment on this thread worth its salt was by whomever alerted the original poster to the impending Corporate real estate collapse - please check out the collapse of Dubai as the epicentre of this little gem.

reply to post by MrJelly


So, Mr jelly, if I hold you down and punch you repeatedly in the face, it's completely your fault for not being tough enough to repel me?

That's a pretty twisted way of looking at things, pal. Downright sadistic and cruel, if you ask me.

Why is it that the elites, in their supposed infinte power and wisdom, continue to punch humanity in the face instead of giving it a hand up?

reply to post by audas


That is quite the fantasy you just described for the enemies of the U.S., but that is all it is. The only thing China currently has going for it is their cheap slave labor. Their productivity and quality continue to remain very low, and they are developing a toxic environment that will cause them tremendous problems in the not too distant future.

As far as oil and the Middle East are concerned, it is twilight in the desert. Iran oil production peaked about a decade ago, In another ten years, their productivity will be considerably dried up. Guess who they will turn to in order to milk the last barrels of oil out of the desert? In the meantime the U.S. is still well cozied up to the Saud's, and that will continue until they run out of oil.

The problem for the CWO in Iraq is that U.S. soldiers did far better than they were expected to do. Iraq is actually evolving into a viable democratic style government, and that is not what the CWO wanted.

A world wide depression has already began, and like the Great Depression, the wealthy are the ones who loose the most. China and the rest of the world will suffer more than the U.S., and they are equally responsible for this situation.

Just thought I would bump this back up to the top because of the Tea Parties and a few people not really understanding why they are protesting.

To: Poet1b

While it is true that economics is founded on supply and demand, these principles will not lead us to a deep understanding of a complicated economic crisis. If we were to try to characterize the current situation only in terms of supply and demand, we would find ourselves pontificating without any real solutions. Just imagine if you were trying to understand a problem on a circuitboard when all you really understand is current and voltage. These concepts will carry you far in the world of electronics, but if you really want to understand a circuitboard, you'll have to familiarize yourself with of the nitty-gritty details of the practice. In order to fix a problem with the circuitboard, you'll need a vocabulary that begins with voltage and current, but that also includes transistors, capacitors, diodes, switches, fuses, etc. The same goes for our economic crisis, Poet1b. Just as cognoscente mentioned, raising the wages in third-world countries does need to happen, but the means by which it happens is the really critical issue. You can proclaim the necessity of the act all you want, but it is not a solution. You won't fix a circuitboard simply by observing that the voltage in a particular area should be lowered. You need to figure out how to lower that voltage so that the circuitboard will function.

To: cognoscente

On a final note, what's with this propensity for rebellion against the system? So what if money is fiat? The problem is the existence of a central, private authority able to print money with little or no oversight.

You've made a fundamental mistakes in your assessment of the problem. You have already characterized the problem before you have attempted to find out what the problem is in the first place! Suppose I walk into a room and there are three people trying to play spades with a partial deck of cards. I, being the only one really familiar with the game, can solve their problems and set them playing a fun and strategic game. But the solution with which I provide these misguided card-players depends on how much effort I put into the diagnosis of the problem. Obviously, spades requires four people to play, so if I tell them that they need a fourth person, it is possible that they will be well on their way to a good game of spades. But if I do not make sure to consider all the possible sources of disfunction, then I run the risk of misleading them. I, as an expert, have characterized the problem as a shortage of players. So when they find their fourth person and go on their way, if should they have another problem that I didn't even bother to think about, they will be less likely to see it as a problem because the expert already came in and fixed it! But how are you going to play spades with partial deck of cards? This less obvious problem still ruins the game; it's just that the problem requires greater attention to diagnose. Are you willing to focus your attention on the more subtle problem, cognoscente?

You say the the financial problems that have been caused by poor management of currency. While this has clearly been a major problem, it is not the only problem. Canada has apparently been playing spades with four people, where America has been trying to do it with three, but both have partial decks. So: What is missing from the deck?

[edit on 19-4-2009 by PriamsPride]

Lets look at the Third-World countries which seem to do all the manufacturing these days.

You mention that in the US, manufacturing has been progressively transported overseas, because "workers are used to lower wages" and "consumer markets overseas are virtually non-existent". What has happened with these two facts is as follows: Third-World workers have been enlisted to manufacture goods for which they "have no taste," but which they are paid very little to produce. Their environments are being polluted because there is no figure strong enough to tell the corporations "no", all for the sake of manufacturing goods that they don't even want. Furthermore, the demands of labor have necessitated that these workers rely on corporate infrastructure (electricity, water, food supply) because long work weeks eliminate the ability for these Third-World workers to maintain their own infrastructure. But this infrastructure is paid for by the workers themselves, so the tradeoff appears to be as follows: 1. A Third-world country lives in small villages in which no one has very much to live on, but the villages make do by spreading the work. 2. A corporation comes in promising money and jobs. 3. The corporation provides the money and jobs, but the money must all be spent on basic human needs, and the jobs are unpleasant at best. Certainly no one feels as if they are doing something worthwhile, since they don't even purchase the goods they manufacture. 4. There is no longer any time for these people to focus on health and infrastructure, so other corporations take over these responsibilities. Now I'm not saying that Third-World countries are a basket of roses until the Evil Empire steps in and #s all over everyone. What I am saying is that it appears that the problem of food and infrastructure is halfway solved at the cost of great human suffering. The price is not worth the benefit for these people. So if you think that capitalism is good for Third-World countries, then this is pure fantasy. Third-World countries have become slaves to corporations, and nothing seems to be changing. You are right, "the third world needs to get its priorities straight," but the First-World needs to stop exploiting the Third-World before we can expect this to happen. How the hell is a beggar supposed to clean up and get a job if you beat him for being a beggar every day? Naturally, this is all stuff you already know. But let us continue.

Alright, so corporate America is not beneficial to the Third-World. Is it beneficial to America?

Well, now that all the jobs have been exported, the apparent class of consumers no longer has an income with which to consume. So we borrow. And we borrow. And we borrow a little more. Of course, what happens when you pay loans with loans is that interest will one day creep up and devastate your finances. I believe this is the problem that you have been pointing out. By exporting all the jobs we have put ourselves into a financial hole and we have also made slaves out of much of the rest of the world.

The fact is Americans work harder and smarter than any other nation. Ingenuity is their commodity of choice, and it is in high demand by the periphery countries, which thrive off the manufacturing opportunities presented to them by U.S. researchers, firms and other entrepreneurs.

Now why is this the case? Indeed, you mention the cause yourself: "The workers work. The capitalist classes consume." America is full of workers who don't want to be workers; they want to be capitalists. The reason that America is full of these sorts of persons has nothing to do with culture. The reason we have so many aspiring capitalists is that America is where all the capital is! So when you say that the workers work and the capitalists consume, what you are ultimately saying is that those with money rule and everyone else is a slave. Those who rule invent the rules. You might call it 'ingenuity', but American ingenuity today is nothing more than devising new methods to maximize profits.

This seems to be your solution: "Demand will replace itself as soon as credit begins to flow and these toxic assets are dealt with. Both trade and productivity were excellent before the financials went out of whack."

You are right, in that this financial crisis is certainly the result of mismanaged banks, investing firms and insurance firms. But the financial crisis is a crisis for the banks and firms, it is not so much a crisis for the average American person. Certainly we feel the effects of it because no one can get a loan, but the financial crisis for the banks and firms is a macrocosm of what has already happened to the average American person. We've taken out myriad loans with the notion that we were investing in our future, but if the corporations care about nothing but profit, then we have an impasse. The impasse is as follows. The progressive corporatization of America is evident -- seems like no one works for a small independent business anymore. This conglomeration of wealth into a set of enormous service-providing entities is a direct consequence of the corporate maximization of profits. Because the driving feature of a corporation is to maximize profits, it doesn't matter how people are treated and what laws are broken -- so long as the corporation doesn't end up with mud on its face. But the easiest way to exploit both the law and the human being is by exporting your manufacturing to Third-World countries in which there is no one who will complain about how you do your business. At least not anyone whom you have to listen to. So all the real work has now left the country and is being done by slaves, while we American workers who wanted to count ourselves among the Capitalists (as Americans always do) have found that we need to borrow money in order to live. Why do we need to borrow so much more now than we used to? Well this is because wages have stagnated: in their constant effort to maximize profits, the corporations which now control the goods produced have realized that when you don't pay your workers enough, they will just take out loans to make up the difference. This means more profit for the corporation, of course! But because there are no jobs which pay high enough wages for us to pay back all these loans we've taken out in order to have our cars, our education, our houses, and anything we own at all. Americans do not make money working jobs anymore. If they did, they would not need to take out loans in order to buy cars, houses and educations.

[edit on 19-4-2009 by PriamsPride]

No, the American people are in a financial crisis because the ethical maxim that the corporations use ("maximize profits!") has consolidated all the wealth into the hands of the corporations themselves, their executives, and their investors. What this means is that all the wealth is on Wall Street. We hopeful capitalists (already in financial crisis) have noticed this, so suddenly everyone wants to invest in the stock market, naively dreaming that in the stock market there are no losers. In order to meet this demand for investment, something had do be done: a pyramid scheme was created by the banks and investing firms (again, all in the name of maximization of profit), in which it appeared that there were no losers. Of course, this is the draw of pyramid schemes: there never appear to be losers. It turns out, though, that when one person has all the wealth, there is no profit. There is only the ruler with the wealth and the slaves with nothing.

This is why the driving ethical maxim that all businesses seem to espouse today is the fundamental flaw in our economic system. If we maximize profit, we consolidate all wealth in to the hands of a few, creating a sharp split in classes which widens until the split is absolute. However, once there is no more profit to be had, it is impossible to maximize profit! This is completely and utterly unsustainable! But the problem is deeply entrenched. Until we find a way to convince the people who manufacture our goods that profit is not the only thing worth attaining, we will be attempting to sustain an unsustainable system.

In a normal game of spades, the player with the Ace of Spades spends the whole game looking for a good opportunity to use the Ace. Similarly, the players without the Ace spend the whole game trying to figure out who has it and when it will come out. If the Ace of Spades isn't even in the deck, then we will have spent the whole game waiting for the Ace of Spades, but the Ace will never come. Now you might think that what happens in a game of spades in which the Ace is missing is that whoever would have had the Ace of Spades is now screwed and his team will not make their bid. But this is all wrong. What really happens is that everything thinks that someone else has the Ace, so they play as if it will eventually come out. But when you play this way, you save your other high spades so that they don't get trumped by the Ace. Well, when we get to the last trick, and we see three high spades and a fourth player with an empty hand, we will not discover that one team has won and the other has lost. Not at all! We will realize that the entire time, the game was nothing but a sham. We will have all squandered our high cards in anticipation of the Ace, and everyone loses because everyone has just wasted all their efforts.

This is what is happening today in our economic system. The Ace of Spades is the real value of monetary wealth. This value is entirely absent on our current system. But because no one has it, everyone is looking for it, and they maximize their profits in anticipation of the accruement of real value. It turns out that the real value is all the other spades in the deck. So our corporations have been wasting resources in their quest for money, and when the money turns out to be worthless, we find that we have spent absurd amounts of resources, human lives and time trying to find absolute value in something that only has relative value. Money is not a thing worth having. It is a means to an end. So until the people in charge find a way to put money back in its appropriate context, corporations will continue to squeeze all the money they can out of us, only to find that it is all just paper.

No, the financial crisis is one symptom among many symptoms (such as student loans) that our current economic system has almost reached its logical conclusion. The sham hand is nearly ended.

-Priam's Pride

[edit on 19-4-2009 by PriamsPride]

I used to think fractional reserve was the problem... but I don't think so any longer. Publically owned companies are the problem. No one should be able to sit at their house buy stock and make a ton of money on it just by getting lucky or studying a game. All the money in your mutual funds that has grown and grown? None of your individual talent has went to producing the profit of it... and likely very little of your time. So in reality, you've lost only a portion of your actual investement which in the big picture isn't that big of a deal... the more rich you were this way the more you will be affected. Publically owned companies also do stupid things like sell off completely viable manufacturing portions of their company in order to increase profit *percentage* by dumping lesser profitable (although viable) areas which has hollowed out this countries ability to manufacter stuff...

If there is a depression, could have fooled me. People are still buying nice shiny cars, are out in droves at the malls... only difference is instead of paying 600k for a house worth 250k you pay 250k now. Which is good. :-)