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weeee!!!! lets play the wheel of MIS-fortune!!!
weeee!!!! lets play the wheel of MIS-fortune!!!
It's global now?!?
But ... but ... but the NY Times said it was all Bush and McCain's fault. Are Bush and McCain powerful enough to damage the planet's economy?
Or is the Times \"stretching the truth\" to advance a political agenda? Nah, they wouldn't do something like that.
Would they?
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@Ssscorpion: Not that the blame can be completely placed on Bush, but you realize that every (mis)adventure in his life as turned into a brilliant fucking failure, so you really shouldn't act so surprised.
Coupled with an impotent legislative branch and the \"gotta keep buying\" mentality of the public, and here ya go, enjoy.
as much as I DESPISE Bush, I have to step in and say that not signing the Kyoto Protocol was the only good thing he did.
Without going into really deep details, most economists and a lot of (moderate) environmental groups agree that the parameters set for the US in the Kyoto protocol were designed to arbitrarily punish and hamstring the United States, NOT reduce emissions.
...
Yeah, I didn't believe it either, until my (EXTREMELY) environmentally conscious economics professor explained it.
@Ssscorpion: I'm sorry, I missed that quote in the article. Could you point it out to me or is this something that only shows up during daily hallucinations?
@Ssscorpion: You do realize that trillions of foreign investments are in the US don't you? From real estate, to yes CDS and MBS. In fact there was nice little one hour discussion on just how much money other countries have spent investing in the US. Here go listen to the original broadcast [www.thislife.org] and the follow up [www.thisamericanlife.org] and the culmination of many years worth bad legislation including both Republicans and Democrats caused, but in the last 16 years the Republicans created a majority of that legislation, and Democrats let them get away with it.
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@tricky69: Try not to mind Ssscorpion. He's a lot like my grandpa. He comes in, takes a crap on the floor, then dissapears without acknowledging anyone.
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@Ssscorpion: Events in America have far more impact on the rest of the world than, say, events in Nauru.
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@Ssscorpion: The media has little to gain backing one candidate. However, they have a lot to gain by ensuring the race stays close.
So let's see, Paulson and his pals get a blank check and we're still screwed...maybe worse than before. What the hell happens if Iceland falls for god's sake?
@katbur2: If you like bananas, then the fall of the Icelandic state could certainly hurt you. Iceland is Europe's largest exporter of bananas. No kidding.
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@bnosach: It's the biggest European producer of bananas, but they produce very little; it's just that their very little is larger than the rest of Europe's. Ireland is the biggest European exporter with its secondary distribution of the Belize crop.
So Iceland's effects on European banana consumption are negligible.
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@Suttin: There are a bunch of items in play keeping the dollar buoyant. First the euro is not doing all that well itself with European banks in worse shape when it comes to leverage. The second is that people need to pay down/off debt and for the most part that is dollar denominated and therefore people need dollars. When people want more of a commodity then the price goes up.
You will see that the dollar is loosing ground to the Yen which is not surprising. The strong dollar will not last forever if the Fed keep cranking out the dollars at the pace they have been.
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Whine, whine, whine....just take a deep breath people. This is going to last awhile, you'll just have to get used to tightened purse strings.
Believe it or not you can be perfectly happy on a small budget.
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@dragonfire81: Yeah, i'm super excited about eating gruel while Dick Fuld licks aged brie off of hooker nipples as a reward for cratering a multi bazillion dollar enterprise.
Just because it's reality doesn't mean we have to like it.
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@dragonfire81: You apparently don't realize not everyone is in a job that they get a weekly paycheck.
I'm a freelancer so work has essentially dried up. I am fine living on a small budget but with a crap economy it makes a budget non-existant without income.
They say things will get worse before they get better. At least they're half-right.
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And yet, Cavuto today was still talking about how there should have been some personal responsibility on the part of the individuals who took out sub-prime mortgages.
<sarcasm>As if this all would have been prevented if only \"the poor\" had stopped to think \"Hey! I can't afford this interest-only ARM that's been tossed at my feet. Anyone can tell that my mortgage will end up securitized in highly-leveraged investment vehicles (like a collateralized mortgage obligation) that will the global economy. If I default, not only will I get kicked out of my new house, but the world economy will collapse.\"
It's all your fault poor guy. Surely you should have known better. The smartest guys in the room were all on top of things when they offered you money and sold your debt to others. You dropped the ball by taking it.</sarcasm>
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@Michael Belisle: So I take it you're against personal responsibility and accountability for bad decisions? Otherwise, why would you be so incensed that someone would advocate a policy which acknowledged that borrowers who took on shady loans were partially to blame for this mess? If you can't read and add, as you say, perhaps you have no business taking on a complex financial arrangement like a mortgage. If someone shows up at your door with an offer for which you have very obviously not qualified, you say \"no\".
@AtomicPlayboy: No, I am not against personal responsibility. But at this point, the amount to which personal responsibility on the part of the borrowers contributed to this crisis is negligible.
When one lender loses money because someone can't pay of their mortgage, that's a case where personal responsibility on the part of the borrower might be a good place to lay the blame. But when the economy collapses because varied parties far and wide tried to make unsustainable profits by under-evaluating the risk of lending money to risky individuals, over-leveraging their portfolios (and so on), that's a different story. Shouldn't lenders have exercised some personal responsibility with their money?!
If you can't read and add, as you say, perhaps you have no business taking on a complex financial arrangement like a mortgage. If someone shows up at your door with an offer for which you have very obviously not qualified, you say \"no\".
If you have some money to lend, you probably shouldn't go around offering it to people who can't \"read and add\" and won't be able to pay it back. Why would you go to someone's door and just offer them money without sufficiently evaluating whether or not you should give them money? Sounds like lenders should have exercised some personal responsibility.
So my main point is that there should have been some \"personal responsibility\" all up and down the ladder. Everyone involved fucked up. The {borrowers, salespeople, banks, insurers, investors, speculators, brokers, financiers, regulators, executives, corporations, governments, et al.} all should have known better. Trying to primarily blame any one party is futile when the catastrafuck is so widespread.
@Michael Belisle: This a far more sensible argument than the original one you made, now that you've taken the sarcasm out of it. I suppose we may differ in that when it comes to stupidity and those who exploit it, I tend to be a demand-sider and not a supply-sider. For instance, I don't blame spammers for sending me email offers for boner pills. I blame the handful of idiots who respond to these offers and make them profitable. I'd be happy if they both were to disappear from the earth, to be sure, but the former could not exist without the latter.
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@Michael Belisle: Cavuto isn't that bright.
The moron actually blamed lending to MINORITIES and risky borrowers as part of his thesis.
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@ironchef: Maybe you missed something: lending to risky borrowers WAS one of the major causes of this. Sadly enough, they tend to be minorities and rural folks.
Its sad that people couldn't qualify for the FHA loans. Those just require 3% down and no credit check. Oh, but there is an income documentation requirement. Seriously. That's it.
The problems of this economy come down to the fact we got away from the conservative lending rules that governed us for a good part of the last century. Money down. Total monthly payment no more than 25% of your take-home pay. Document income.
No, instead everyone got greedy. Lender and lendee included. Trust me, there's enough blame to go around. But unfortunately now those who were responsible are paying the price for everyone else.
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Its sad that people couldn't qualify for the FHA loans. Those just require 3% down and no credit check. Oh, but there is an income documentation requirement. Seriously. That's it.
I can second that. I have an FHA loan, which I got because of an unfortunately high DTI (something I am working diligently on fixing). Also, recognizing my situation for what it is, I bought a house that had only a five-digit price. Consequently, five years later, I am still in my home with little to no worry about getting foreclosed -- It is affordable; it's just that simple.
I cashed in some other assets (took some equity out of my life insurance policy) to make the downpayment and deposit, and got the seller to pick up the tab for the closing costs, in exchange for a 6-week rent-back agreement.
I had a good lawyer and a good realtor :-)
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@ironchef: From what I hear some of the risky borrowers were given loans because of community organizers basically pressuring banks for a social agenda. That may have meant they were a minority or the poor or whatever.
@Tux the Penguin: @battra92: His emphasis is on the word minorities, as in \"Loaning to minorities ... is a disaster.\" It's a bigoted statement, cleverly followed by a reasonable mention of \"risky\" so that you can try the \"but he said risky borrowers!\" defense. Saying that lending to risky borrowers is part of the problem is in the \"no shit Cavuto\" category.
This ties in to a recent observation: if you're going to write a hate-filled diatribe that gets published in a mainstream newspaper, make sure that your first and last paragraphs are reasonable. That's all the bigot-defenders will read. Weave in a few more level-headed arguments for those who might spot check the rest of the story, and you're golden.
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@Michael Belisle: Cavuto's right. Of course the people are not solely to blame, but to deny they played any part in this is ridiculous.
@lukobe: You kidding? To this day the Bush administration still hasnt paid ANY of their end of their very own No Child Left Behind program making State and Local government food the bill for what the administration has failed to provide. Why would a little financial crisis change that. Thats 8 YEARS they still have not paid despite continuing to enforce the program on the states.
@lukobe: Of course they share some responsibility in some form or another. But the people receiving the money, as you said, \"can hardly read and add by the time they get out of school.\" The collective of customers were just the pawns in the scheme.
It's a bit like the architects of this disaster thought it'd be a great idea to build an upside-down pyramid, thinking that they can just get enough people to hold it steady. They kept building the pyramid bigger and bigger, while bringing in more people to hold it steady. Eventually, the architects decided that it could handle the world economy.
Now that the Great Inverted Pyramid has toppled and shattered the world economy, it's like you're blaming the labor for not holding it up, instead of blaming the idiots who thought an inverted pyramid was a good idea.
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@Michael Belisle:
it's like you're blaming the labor for not holding it up, instead of blaming the idiots who thought an inverted pyramid was a good idea.
Very well played, sir.
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Oh, NOW people start caring about how the world economy works. This media scramble is hilarious to me, just like when everyone got all excited about the electoral college (avg. American: \"whuts THAAAAAT?!?!\") in the 2000 and 2004 Presidential elections. Must every 'crisis' become a national refresher course in middle school political science or freshman economics? Ignorance is not a virtue, folks. Learning about money is not just for EVIL Wall Street types.
I am a strong believer in the Paulson plan, and whatever financial freefall awaits the rest of the planet (and us) it will be have been dampened by Congress' quick, decisive action. Even a basic understanding of financial markets and institutions should clue you in that it can't fail to help. The solution will take months to unwind the credit markets, but I guess I can look forward to daily pronouncements of \"FAIL!\" from the many armchair generals out there (and that hack Krugman @ the Times).
It's funny how people so admired Europe's progressive, socialist health-care systems and unemployment insurance, social security schemes and union-dominated labor markets. The economic inefficiencies involved were/are incredible, and their governments' flexibility in dealing with emergencies is nonexistent. Even the most minor economic crisis now stands to grind their economies to dust. How sad.
@god_forbids: Its estimated in the US that 28K people die a year that would not if they had health insurance. Guess we are ok with casualties of war unlike those wimpy Europeans. Whoops wait a minute, we do better than Russia.
@god_forbids: Your post to me reads like a giant non sequitur.
You must not understand the situation well if 1) you think anyone's going to be making daily pronouncements of the failure of the bailout as indicative of the bailout failing to work -- especially Krugman who generally backed it because he thought it would largely be money moving around in a giant circle and 2) You think Europe is having a harder time coping with this meltdown than we are in the US because of their more socialist attitudes.
I don't even know where to begin with how nonsensical your post is.
But let me instead take you back to a time when I was at a wedding in 2003. There I met someone I went to law school with. He'd actually gone to medical school before law school, but never did his residency. After law school, I'm not sure he even took the bar. He never practiced law, but took his M.D. J.D. having self to wall street where, in the parlance of those days, he was \"buying and selling risk.\" I tried to get him to explain it to me. In essence, he was talking about credit default swaps.
I was fascinated by it all, and when he was done, I said to him, man, one day the comeuppance from that is going to come and it's going to cost us more than the S&L bailout did with all the interest we paid on that money.
So don't give me any lectures about what I do and do not know. But hey, you might want to try learning something. You might start making a little bit of sense.
@god_forbids: Well, at least CNN Money agrees with me:
Part of the reason for the far less severe economic pain expected this time are the social safety net programs - including Social Security, unemployment insurance and insurance on bank deposits - that were not in place at the start of the Great Depression. [money.cnn.com]
@god_forbids: Dude, middle school poli sci and freshman economics? Where have you been hanging out? People can hardly read and add by the time they get out of school.
If the government were truly serious about preventing this sort of mess in the future they'd have taken the $150 billion in pork they slapped onto the bailout bill and spent it all on comprehensive financial education in our schools.
But of course that will never happen.
@lukobe: I'm no fan of government programs but I think that one thing that those facing foreclosure or bankruptcy must, by law, be required to attend money management classes.
@god_forbids: Oh, NOW people start caring about how the world economy works.
Do I care how Internet routing works when everything is working fine?
It's funny how people so admired Europe's progressive, socialist health-care systems and unemployment insurance, social security schemes and union-dominated labor markets.
Umm, I still do. Besides, let's recap which of these things we have also have in the US:
Social Security schemes: yes
Unemployment insurance: yup
Union-dominated labor markets: yea
Socialized medicine: not yet
Which of these has a chance of being dropped because of the crisis? None. It's not like I go \"Hey, the government just nationalized AIG in response to the crisis. God forbid if they did that to health care.\"
The economic inefficiencies involved were/are incredible, and their governments' flexibility in dealing with emergencies is nonexistent.
Seems a bit premature to condemn their system for failing the address the crisis when the effects are just started to be acute in other parts of the world. It's not like this crisis appeared on our doorstep yesterday and we fixed it today.
Or, if you like, continue to argue that because we are a little ahead of the rest of the world in trying to clean up the mess we created proves that America is The Greatest Country. I heard Cavuto making that point today too. \"The French are fried\", he said.
@Michael Belisle: Union-dominated labor markets: yea
Actually no. In the private sector in 2006 (most recent data I could find) the numbers seem to show a rather steady decline. Government workers are much more unionized than private sector workers but there is no more than 12-13% of the entire workforce who pays his union master.
Source: [www.bls.gov]
I know it's not really relevant but we're not the union loving society of the 50s anymore.
@Michael Belisle: Union dominated labor? Isn't unionized labor about 12.5% (hint -- leading question)? Where I come from, that is not what we call domination. Are you perhaps from another part of the world that does?
\"God, please give us lower gas prices.\"
\"Fine, but I'm taking everything else.\"
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Yeah, I'm glad that $700 billion bailout worked so well. Now, of course, other countries are blaming the US. Here we go...something good happens, and everyone takes credit..something bad happens, and the US gets blamed for it.
The United States: Global whipping boy.
After listening to the This American Life segment this weekend, it's now apparent how fast and loose financiers have been playing in the market and just how much of a house of cards the system has become. It's one big giant cluster and all it took was a giant gust of wind...or the \"once in a lifetime\" financial hurricane that would never ever happen...the financial Katrina, as it were.
Guess what? The financial levees have broken....
@Grrrrrrrrr: Who specifically is blaming the US?
There's no doubt that the global downturn is a result of the downturn in the US economy. We're a big, interconnected global market. It's not appropriate to dismiss anyone saying that the global market collapse is due to the US as part of the \"blame America first\" crowd.
If they're blaming the situation in the US, then they're absolutely right.
The Germans, for one:
The US may have been the first domino to fall, but we didn't set them all up.
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On the upside, your old Dow 10,000 cap is back in style.
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I am stocking up on cigarettes and booze. When the dollar is no longer worth anything we are going to have to pay for goods and services with cigarettes. Just like in prison.
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And all these countries thank USA for world financial crisis...
It's like trying to stop a tsunami with one sandbag. It just so happens that one sandbag equates to $850 billion dollars. I wonder if we hadn't approved that bill if everything would have been perfectly fine. Knowing now that the world is in financial crisis... it would be nice if I had my cut of that bailout money back.
@Michael Belisle: Right, but every time they conjure sand, the make the island sink a little bit... before we know it, we'll be safe from the tsunami because we're all underwater.
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...I smell a set up...every time this planet has faced a major financial crisis, what has been the answer? think a bout it...well, let's get ready to rumble!
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Hey, aren't you glad we decided to waste a trillion fucking dollars now??
@hellinmyeyes:
Don't look at me! I was very fervently against the bailout. This crap will never end. We will continue to buy and borrow our way out of this mess until the end of time and still have nothing to show for it, three days or three generations from now.
*
@hellinmyeyes: ZOMG THE STOCK MARKET HASN'T RECOVERED 4000 POINTS YET, THE BAILOUT IS A FAILURE!
Honestly, people. It's been three days.