Posted on 03/08/2008 5:31:18 AM PST by Travis McGee
BTTT
“Embrace the recession”
PFLR
I’ll say that I didn’t realize so many people were using home equity to buy stuff they couldn’t afford. Because the value of their homes went up they thought they were in money... I don’t understand why they didn’t realize that every cent was borrowed money that had to be paid back regardless of the current value of their home. I really, really don’t understand.
All of America seems to have the head-in-sand condition. Corporate America is just as bad. Most execs and managers never seem to see the doom coming yet every employee is screaming about it. It is pure laziness. As long as they are getting a paycheck and can go home at 5:00 they believe things will be just fine.
Schiff is an Austiran, and he is right. Laffer is a Keynsian, and he is dead wrong.
"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved."~~Ludwig von Mises
"Credit expansion can bring about a temporary boom. But such a fictitious prosperity must end in a general depression of trade, a slump."~~Ludwig von Mises
"True, governments can reduce the rate of interest in the short run. They can issue additional paper money. They can open the way to credit expansion by the banks. They can thus create an artificial boom and the appearance of prosperity. But such a boom is bound to collapse soon or late and to bring about a depression."~~Ludwig von Mises
"Credit expansion is not a nostrum to make people happy. The boom it engenders must inevitably lead to a debacle and unhappiness."~~Ludwig von Mises
"What is needed for a sound expansion of production is additional capital goods, not money or fiduciary media. The credit boom is built on the sands of banknotes and deposits. It must collapse."~~Ludwig von Mises
"If the credit expansion is not stopped in time, the boom turns into the crack-up boom; the flight into real values begins, and the whole monetary system founders."~~Ludwig von Mises
Oh, boy. I can't wait for the super-capitalists here on FR to come to this thread and tell us how important it really is for China to take our dollars.
Or, to tell us that debt is better than tangible assets.
Or, that equity really IS wealth.
Or, that GDP is more important than a middle class.
” I really, really dont understand. “
Neither, apparently, did the vast multitudes that bought into the “Equity Farming” myth....
And, on the ol’ Equity Farm, the chickens are coming home to roost.....
What does this guy know? It is common knowledge in Amerika that you can borrow your way to wealth. The bigger the loan they “give” you, the luckier you are!
I just got approved for a 900,000 dollar loan, I’m going to be RICH! /s
My wife was like that. She couldn't grasp that equity didn't exist unless you took out a loan and had to pay it back.
Luckily I was able to get through to her.
Then I guess it’s time againg for “Spanish Lessons.”
William R. Hawkins, Wednesday, April 07, 2004
snip
“Yet, Spanish leaders were deluded by a sense of false prosperity. This is testified by the statement of a prominent official, Alfonso Nunez de Castro in 1675: ‘Let London manufacture those fine fabrics of hers to her heart’s content; let Holland her chambrays; Florence her cloth; the Indies their beaver and vicuna; Milan her brocade, Italy and Flanders their linens...so long as our capital can enjoy them; the only thing it proves is that all nations train their journeymen for Madrid, and that Madrid is the queen of Parliaments, for all the world serves her and she serves nobody.’ A few years later, the Madrid government was bankrupt. The Spanish nobleman had foolishly elevated consumption, a use for wealth, above production, the creation of wealth.”
Art Laffer sounds just like Alfonso Nunez de Castro in the video.
Perpetual Bears are like broken clocks, they are eventually correct. I don’t listen to them.
The time to listen is when a Bullish person makes Bearish predictions.
I remember a guy that was predicting a burst of the tech bubble from 1990 all the way to when it burst ten years later. Then he wanted to be treated like a profit. All high growth sectors eventually burst. It happens every single time.
I wonder which FR super-capitalist is really Laffer?
Laffer staked a penny and his sacred honor on the current.
Laffer - "seignorage gain" is what he calls it when we run a $60B per month trade deficit. He also claims that families have 2 incomes because the "love their work."
I think Laffer lost the bet.
Believe it or not, there ARE times when it is prudent to be Bearish.
Thought admittedly it is not en vogue here on FR with a R in the WH.
These are some of the 'Boys' that Ben Bernanke is trying to save by raping the dollar. Read the report for yourselves. I say 'Line 'em up and shoot 'em down.'
Get out your popcorn. These investigations are just getting started. Corrupt mortgage lenders get burned in live testimony. Will 'Big Angelo' go to jail or get whacked by his cronies when he travels to Sicily? . . . LOL . . . LOL !
Watch this Video on the Rape of the Dollar
If you do not have a high speed Internet connection, use a friend's or drive to the public library. Have a good, long horse laugh for free.
There are a lot of times when its prudent to be bearish. I'm bearish right now. I was just pointing out that there are people who make a career out of being bearish and then want to be treated like a profit when they are right. Like a weather man that predicts snow every day of the year, and then runs around yelling "I told you so" on the day of the big blizzard.
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