"People would rather defend the possibility of becoming rich rather than to admit to their own poverty."
John Hancock
Everybody should have seen this coming but when the money is rolling in, nobody wants to rock the boat. As always the poor suffer the most and the middle class are being hit very hard as the Wall Street traders are sitting pretty with their average $600,000 bonuses. There hasn't been such a disparity in wealth since 1929 with the very, very top, the top one percent and especially the top .1 percent living like Roman emperors on the dime of the rest. Well we all know what happened to Rome.
The causes have been detailed and analyzed. It doesn't take a genius to see why this happened. Also, what we have learned is that the dollar is still (for now) the currency of the world. Even I predicted that the Euro would be the new dollar and China and Japan would eventually cut off our IOU for a more stable standard. This seems not to be the case. China will not call in its markers short of a nuclear war.
The ailing stock market, the bank defaults, the housing bubble and all the rest are only symptoms of the disease. The Reaganomic, trickle down theory where free markets regulate themselves is horse manure. Yesterday Greenspan finally admitted this, if in an ever so subtle way. Congressional hearings are just for show with both parties staging the theater and no one goes to jail. Unenforced regulations mean nothing. Only legislation has teeth. People need to go to jail for fraud or this will certainly happen again. FDR used the psychology of a strong, likeable, father figure to help the public feel better, but it was the economic policy he pursued from John Maynard Keynes that slowly removed us from The Great Depression.
The economy can be saved if we take that bailout money and invest from the bottom up.
1) Infrastructure projects like roads, bridges, hospitals, schools, water supplies, sewage plants would put people to work immediately and leave us with something to show for our money. Despite what some say, there are projects ready to go right now at the state and local level where the plans are already drawn and are just waiting for funding.
2) National health care would take the load off of business both big and small and advance hiring.
3) A shot in the arm for education would pay huge dividends within a decade.
4) Of immediate concern is that money needs to be spent on the homeowners so they can stay in their homes... renegotiated rates to address the discrepancy between what they paid and what they have now.
Of course $800 Billion US (or whatever it is now) wouldn't do all of these things. Rolling back the tax cuts on those at the top to a more equitable level will help but as Keynes said, an economic downturn of this magnitude is the real time to go into hock (not a stupid useless war) Now is the time to borrow even if our national debt is over $10 Trillion. China, Japan, Saudi Arabia are still willing to lend and if we put the money in the right place right now this will reverse itself in 3-5 years. But it looks like the government and the Fed want to play both ends..from the top and the bottom. This will just prolong the agony.So I am predicting that this is no time for happy faces or for drinking the Kool Aid.
This is the big one. It will not be another Great Depression because there are still some safeguards in place leftover from the 1930's but hard times will certainly linger on for most of a decade.
Everybody should have seen this coming but when the money is rolling in, nobody wants to rock the boat. As always the poor suffer the most and the middle class are being hit very hard as the Wall Street traders are sitting pretty with their average $600,000 bonuses. There hasn't been such a disparity in wealth since 1929 with the very, very top, the top one percent and especially the top .1 percent living like Roman emperors on the dime of the rest. Well we all know what happened to Rome.
The causes have been detailed and analyzed. It doesn't take a genius to see why this happened. Also, what we have learned is that the dollar is still (for now) the currency of the world. Even I predicted that the Euro would be the new dollar and China and Japan would eventually cut off our IOU for a more stable standard. This seems not to be the case. China will not call in its markers short of a nuclear war.
The ailing stock market, the bank defaults, the housing bubble and all the rest are only symptoms of the disease. The Reaganomic, trickle down theory where free markets regulate themselves is horse manure. Yesterday Greenspan finally admitted this, if in an ever so subtle way. Congressional hearings are just for show with both parties staging the theater and no one goes to jail. Unenforced regulations mean nothing. Only legislation has teeth. People need to go to jail for fraud or this will certainly happen again. FDR used the psychology of a strong, likeable, father figure to help the public feel better, but it was the economic policy he pursued from John Maynard Keynes that slowly removed us from The Great Depression.
The economy can be saved if we take that bailout money and invest from the bottom up.
1) Infrastructure projects like roads, bridges, hospitals, schools, water supplies, sewage plants would put people to work immediately and leave us with something to show for our money. Despite what some say, there are projects ready to go right now at the state and local level where the plans are already drawn and are just waiting for funding.
2) National health care would take the load off of business both big and small and advance hiring.
3) A shot in the arm for education would pay huge dividends within a decade.
4) Of immediate concern is that money needs to be spent on the homeowners so they can stay in their homes... renegotiated rates to address the discrepancy between what they paid and what they have now.
Of course $800 Billion US (or whatever it is now) wouldn't do all of these things. Rolling back the tax cuts on those at the top to a more equitable level will help but as Keynes said, an economic downturn of this magnitude is the real time to go into hock (not a stupid useless war) Now is the time to borrow even if our national debt is over $10 Trillion. China, Japan, Saudi Arabia are still willing to lend and if we put the money in the right place right now this will reverse itself in 3-5 years. But it looks like the government and the Fed want to play both ends..from the top and the bottom. This will just prolong the agony.So I am predicting that this is no time for happy faces or for drinking the Kool Aid.
This is the big one. It will not be another Great Depression because there are still some safeguards in place leftover from the 1930's but hard times will certainly linger on for most of a decade.
