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Ron Paul on CNN talks about the Trillion Dollar deficit!
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Kenkajin 2.0
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PostPosted: Sat Jan 31, 2009 10:54 pm    Post subject: Reply with quote

voiceofTruth wrote:
So when the dollar fails watchout! People are hanging on to treasury bills but when they finally reject the dollar and go into assets of real value chaos will ensue!
Institutional investors are moving their money from treasuries to corporate debt, FYI.

The collapse is not because of the Fed. It stems from the greed and corruption that runs rampant through all of corporate America. The cronyism and averting of eyes by the government allowed this to happen.
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voiceofTruth
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PostPosted: Sun Feb 01, 2009 5:19 pm    Post subject: Reply with quote

The money which made the greed and misallocation happen was from credit created by the Fed.
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MikeVertx
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PostPosted: Mon Feb 02, 2009 11:33 am    Post subject: Reply with quote

is really one smart interesting guy for real.
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prozacrefugee
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PostPosted: Mon Feb 02, 2009 11:55 am    Post subject: Reply with quote

voiceofTruth wrote:
Which brought about overdevelopment and purchasing of real estate by those who were not qualified. This all started with the socialist program know as freddie/fannie mac 20 years ago. Feeling that people who cannot afford certain housing should be guarenteed there loans.


That's complete bullshit - subprime loans were exactly those which could not qualify for Freddie and Fannie. It was private companies that fed the false expansion of the credit bubble. And it was idiotic, as qualifying for Fannie loans is NOT difficult.

Deregulation was exactly the problem that caused this. Graham's bill in the late 90's allowed banks to no longer hold mortgages, but instead to issue them, and sell the debt as bundled securities. In turn the fast rising derivatives market gave a (totally false) sense of security as investment institutions then moved to leverage their mortgage assets. Freddie and Fannie didn't issues mortgages, their entire purpose was to buy them from issuers to ensure market liquidity. Loans such as interest only or balloon payments were done in spite of Fannie and Freddie, not by it.

Mortgages were assumed to be completely safe, regardless of the actual risk, because conventional "wisdom" was that housing prices always go up. Idiotic, considering the 1987 bust, and the recent tech bust which had claimed the same thing. No price always goes up. Which is part of the reason I sold my house in 2005 for 40% profit after a year - when idiots believe stupid things like "prices always go up" get the FUCK out of that market.

Meanwhile you did have Greenspan refusing to raise rates at the Fed, artifically maintaining the housing bubble just as he did with the tech bubble.

In other words, you're wrong.
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prozacrefugee
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PostPosted: Wed Feb 04, 2009 4:05 pm    Post subject: Reply with quote

voiceofTruth wrote:
The money which made the greed and misallocation happen was from credit created by the Fed.


ALL fractional reserve systems are inflationary, regardless of whom controls them. And full-reserve banking is a misnomer, as it makes savers instead into investors rather than depositors, and severely reduces allocation of capitol to needs (same problem that killed the USSR and other state capitalist systems).

The inflation of housing prices happened not because of the fed, but rather because the private system, through mortage backed securities and the repeal of Glass-Steagall through the Gramm-Leach-Bliley Act, found a way to circumvent regulation and setup their own fractional reserve system, which they underreserved, thus pressing inflationary funds into the housing market. The current housing crash is primarily a bank run, not a supply crisis.

This is EXACTLY why bank regulation is a function of the government. A stable currency is a public good - everyone wants it, nobody wants to pay for it. Private banks, on the other hand, have a profit motive to overloan for their amount of reserves, in order to maximize interest, even if it's against their own interest in the long run. This is why the Fed exists in the first place.
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Angel Bobby Peru
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PostPosted: Thu Feb 05, 2009 12:38 am    Post subject: Reply with quote

cut the military budget and watch the deficit shrink by vast amounts, all while the world becomes a better place.

2009: US$515.4 billion, with a total of US$651.2 billion when emergency discretionary spending and supplemental spending are included. more than 1/4 of combined industrial and agricultural spending. 47% of the world's total military spending.



Nice country.

One time I wish motherfuckers would open their eyes on this and realize how over the top this is, and cut the fucking military budget. If you cut it by a third, there's 20% of our deficit gone, and we'll still be the most powerful and feared country in the world 100 times over.
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jaydee
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PostPosted: Thu Feb 05, 2009 8:16 am    Post subject: Reply with quote

Kenkajin 2.0 wrote:
voiceofTruth wrote:
So when the dollar fails watchout! People are hanging on to treasury bills but when they finally reject the dollar and go into assets of real value chaos will ensue!
It stems from the greed and corruption that runs rampant through all of corporate America. .


this greed and corruption runs rampant through all levels of america,from the guy @ the newsstand overcharging by 50 cents for a bottle of snapple, to the guy writing out a car loan with a little "interest" trick,which really just adds a few grand to his own check, to the americans who for no reason whatsoever raised the asking price on their home by over 75%,just because their neighbor is doing so and on and on,even though the true property values of the area did no reflect that asking price etcetcetc
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prozacrefugee
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PostPosted: Wed Sep 22, 2010 8:13 pm    Post subject: Reply with quote

voiceofTruth wrote:
The next 6 months will determine who is right in the arguement.


Current inflation is 1.5% (and likely overstated for PR reasons). 21 months later, I'd like my pony now.


Considering shorting gold myself, not sure how long the hold will take though if we double dip (which, in the lack of another stimulus, is quite likely.

My only worry in betting against is that a supply shock could cause inflation, but from what I'm seeing the unemployment rate is too high to even cause a major increase in inflation at that point. Unlike the 1980's when much of the unemployment was (correctly) directed to contain inflation there's simply no more policy levers other than stimulus to pull, and those have been stupidly put off the table by both sides for now.
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prozacrefugee
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PostPosted: Tue Oct 12, 2010 5:44 am    Post subject: Reply with quote

Good article here on what the deficit actually means, while running a trade deficit.


http://www.creditwritedowns.com/2010/05/mmt-economics-101-on-federal-budget-deficits.html
The one problem I do have with the large debt the US govt maintains is it acts as a siphon of wealth from the general to the wealthy - however this is more a taxation than monetary matter IMHO.
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prozacrefugee
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PostPosted: Wed Dec 15, 2010 1:06 pm    Post subject: Reply with quote

Further on the idiotic excuse that the housing bubble was because of Fannie and Freddie, and not instead actually Wall Street greed and bad monetary policy.



Please to be explaining the rise in prices in other countries where Freddie and Fannie didn't operate.
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voiceofTruth
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PostPosted: Thu Dec 16, 2010 12:21 am    Post subject: Reply with quote

Hey troll, been busy putting a 8.2 million dollar distressed property deal into contract sorry I have not had more time to spend on da inte=rnetz to discuss graphs and bars. God bless free market capitalism. if you want a job creating NOI set ups or graphs showing cash on cash returns let me know maybe I could work something out.
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Thomas Jefferson
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prozacrefugee
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PostPosted: Thu Dec 16, 2010 2:30 pm    Post subject: Reply with quote

voiceofTruth wrote:
Hey troll, been busy putting a 8.2 million dollar distressed property deal


Is this the rebound in real estate you've been predicting for years now?

Did Fannie and Freddie make the deal?
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voiceofTruth
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PostPosted: Fri Jan 14, 2011 1:11 am    Post subject: Reply with quote


Link

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A strong body makes the mind strong. As to the species of exercises, I advise the gun. While this gives moderate exercise to the body, it gives boldness, enterprise and independence to the mind. Games played with the ball, and others of that nature, are too violent for the body and stamp no character on the mind. Let your gun therefore be your constant companion of your walks.
Thomas Jefferson
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prozacrefugee
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PostPosted: Fri Jan 14, 2011 2:19 am    Post subject: Reply with quote

^Great, we might actually see stagflation then. High rates all around, which is going to raise payments. Or is he advocating a default?

While I don't agree with Paul, he at least isn't pretending that Social Security is the only government expense or that the broken congress is a partisan matter. Or that the increase in spending isn't primarily due to non-discretionary items.

The deficit is an issue - and the demographics of the baby boomers are going to hit us, regardless if you cut spending or not. The problem is there's no real solution that he's offering here.
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voiceofTruth
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PostPosted: Fri Jan 14, 2011 12:47 pm    Post subject: Reply with quote

Quote:
the demographics of the baby boomers are going to hit us,



I don't think people realize how big of a problem this is.
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A strong body makes the mind strong. As to the species of exercises, I advise the gun. While this gives moderate exercise to the body, it gives boldness, enterprise and independence to the mind. Games played with the ball, and others of that nature, are too violent for the body and stamp no character on the mind. Let your gun therefore be your constant companion of your walks.
Thomas Jefferson
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