Thread: Stop Coddling the super Rich

Originally Posted by michael h

Global_Imbalances_and_Financial_Crisis
As a matter of attentiveness I gave you a link to a 64 page economic study by Harvard. The link.
www.economics.harvard.edu/faculty/rogoff/files/Global_Imbalances_and_Financial_Crisis.pdf

I supported my debate with the article.
Page 1
Indeed, we ourselves began pointing to the potential risks of the “global
imbalances” in a series of papers beginning in 2001.2 As we will argue, the global imbalances did not cause the leverage and housing bubbles, but they were a critically important codeterminant.

Page 1 of my supporting argument makes it only a codeterminant. Of course you picked up on this?

:rolleyes: The trade deficit did not cause the housing market collapse, nor did it cause the financial meltdown that was tied to it. As I wrote, which you ridiculed and dismissed: “The devaluation of the dollar was caused by a combination of factors but mostly the Federal Reserve poor monetary policy and the Federal governments increasing debt load. The devaluation of the dollar had nothing to do with our trade deficit. PERIOD.

The trade deficit/capital surplus had nothing to do with the housing bubble. PERIOD.

What institution controls the money supply? The Fed. What was the Fed doing just before the housing market collapse? Tightening the money supply right when the demand for money was increasing. As Arthur writes in: Amazon.com: Return to Prosperity: How America Can Regain Its Economic Superpower Status (9781439159927): Arthur B. Laffer, Stephen Moore: Books
In early 2007 things started changing. First there was a resurgence of real GDP growth in the second and third quarters, meaning the growth rate in the transactions demand for money stopped declining. Second, the ninety-one day T-bill leveled off and started to fall, leading to a huge increase in the speculative demand for money. The monetary base, however, did not grow at all. What happened was money become scarcer and scarcer. And when you combine this increase in the demand for money with the Fed’s tight monetary policy over a long period of time, something’s going to happen that will trigger a financial collapse.

The housing market collapse triggered a liquidity crisis, as Arthur characterizes, “of world-class proportion.”

The housing market bubble was created by ignorant lending practices forced on banks by the government in its efforts for affordable housing and exacerbated by the actions of Freddie and Fannie. This was pushed primarily by the Democrats, but the Republicans caught the fever also. When those at Treasury and the Fed and in the Bush administration started warning about the dangers of Freddie and Fannie and the need for new regulations to restrict Freddie and Fannie, they were all demonized by the Democrats on the House Banking Committee, most notably by Franks, Dodd, and Waters. As I have already posted and reposted:

That by itself would not have been a problem, but it was a contributing factor which was made much worse by the efforts for affordable housing, the Community Reinvestment Act, the willful ignorance and ideology of Franks, Waters, and Dodd on the House Banking Committee, and the corruption at Freddie and Fannie. Check these out for a better understanding of why the housing bubble burst:
YouTube - ‪McCain's Early Recognition of Fannie/Freddie Crisis‬‏
YouTube - ‪Barney Frank in 2005: What Housing Bubble?‬‏
YouTube - ‪Shocking Video Unearthed Democrats in their own words Covering up the Fannie Mae, Freddie Mac Scam that caused our Economic Crisis‬‏
YouTube - ‪EVIDENCE FOUND!!! Clinton administration's "BANK AFFIRMATIVE ACTION" They forced banks to make BAD LOANS and ACORN and Obama's tie to all of it!!!‬‏
And especially: FORA.tv - Thomas Sowell: The Housing Boom and Bust

The evidence I presented above actually has a direct causal relationship with the housing market collapse and the financial meltdown. Your silly theory about trade deficits does not.”

I also quoted in full Thomas Sowell’s column The Housing Boom and Bust
Thomas Sowell
The Housing Boom and Bust - Thomas Sowell - Townhall Conservative

Here I will only include the so-called money quotes:
Because banks are regulated by various agencies of the federal government, it was easy to pressure them to lend to people that they would not otherwise lend to-- namely, people with lower incomes, poorer credit ratings and little or no money for a conventional down payment of 20 percent of the price of a house.

Banks whose mortgage loan approval rates for "the underserved population" did not match the prevailing preconceptions found that they could not get government regulatory agencies to approve their business decisions on opening new branches or enlarging their financial operations, the way competing banks did when those competing banks met the lending quotas set by the government.

Riskier mortgage lending practices, imposed by government, were what set the stage for many mortgage payments to stop and thus for the financial disasters that followed.

Now, reread the Sowell article you linked to. Do you see any connections? Probably not.

Why can't I take Sowell serious? A google image search of him and Paul Krugman yield different results. Krugmans search comes up with mounds of economic data. Sowells search ... well I posted the only data that came up. Sad.

That is plan garbage. You believe that data only comes in the form of graphs, charts, or tables and that it cannot be presented through exposition. You present charts and graphs that do not support your claims and often have no direct causal connection or relationship to the argument you are making and believe you have presented relevant data. Paul Krugman is usually wrong, while Sowell is rarely, not only with the data but with the analysis and conclusions he makes.

tashi deleks,

M

Originally Posted by Mahasattva

:rolleyes: The trade deficit did not cause the housing market collapse, nor did it cause the financial meltdown that was tied to it. As I wrote, which you ridiculed and dismissed: “The devaluation of the dollar was caused by a combination of factors but mostly the Federal Reserve poor monetary policy and the Federal governments increasing debt load. The devaluation of the dollar had nothing to do with our trade deficit. PERIOD.

The trade deficit/capital surplus had nothing to do with the housing bubble. PERIOD.

What institution controls the money supply? The Fed. What was the Fed doing just before the housing market collapse? Tightening the money supply right when the demand for money was increasing. As Arthur writes in: Amazon.com: Return to Prosperity: How America Can Regain Its Economic Superpower Status (9781439159927): Arthur B. Laffer, Stephen Moore: Books
In early 2007 things started changing. First there was a resurgence of real GDP growth in the second and third quarters, meaning the growth rate in the transactions demand for money stopped declining. Second, the ninety-one day T-bill leveled off and started to fall, leading to a huge increase in the speculative demand for money. The monetary base, however, did not grow at all. What happened was money become scarcer and scarcer. And when you combine this increase in the demand for money with the Fed’s tight monetary policy over a long period of time, something’s going to happen that will trigger a financial collapse.

The housing market collapse triggered a liquidity crisis, as Arthur characterizes, “of world-class proportion.”

The housing market bubble was created by ignorant lending practices forced on banks by the government in its efforts for affordable housing and exacerbated by the actions of Freddie and Fannie. This was pushed primarily by the Democrats, but the Republicans caught the fever also. When those at Treasury and the Fed and in the Bush administration started warning about the dangers of Freddie and Fannie and the need for new regulations to restrict Freddie and Fannie, they were all demonized by the Democrats on the House Banking Committee, most notably by Franks, Dodd, and Waters. As I have already posted and reposted:

That by itself would not have been a problem, but it was a contributing factor which was made much worse by the efforts for affordable housing, the Community Reinvestment Act, the willful ignorance and ideology of Franks, Waters, and Dodd on the House Banking Committee, and the corruption at Freddie and Fannie. Check these out for a better understanding of why the housing bubble burst:
YouTube - ‪McCain's Early Recognition of Fannie/Freddie Crisis‬‏
YouTube - ‪Barney Frank in 2005: What Housing Bubble?‬‏
YouTube - ‪Shocking Video Unearthed Democrats in their own words Covering up the Fannie Mae, Freddie Mac Scam that caused our Economic Crisis‬‏
YouTube - ‪EVIDENCE FOUND!!! Clinton administration's "BANK AFFIRMATIVE ACTION" They forced banks to make BAD LOANS and ACORN and Obama's tie to all of it!!!‬‏
And especially: FORA.tv - Thomas Sowell: The Housing Boom and Bust

The evidence I presented above actually has a direct causal relationship with the housing market collapse and the financial meltdown. Your silly theory about trade deficits does not.”

I also quoted in full Thomas Sowell’s column The Housing Boom and Bust
Thomas Sowell
The Housing Boom and Bust - Thomas Sowell - Townhall Conservative

Here I will only include the so-called money quotes:
Because banks are regulated by various agencies of the federal government, it was easy to pressure them to lend to people that they would not otherwise lend to-- namely, people with lower incomes, poorer credit ratings and little or no money for a conventional down payment of 20 percent of the price of a house.

Banks whose mortgage loan approval rates for "the underserved population" did not match the prevailing preconceptions found that they could not get government regulatory agencies to approve their business decisions on opening new branches or enlarging their financial operations, the way competing banks did when those competing banks met the lending quotas set by the government.

Riskier mortgage lending practices, imposed by government, were what set the stage for many mortgage payments to stop and thus for the financial disasters that followed.

Now, reread the Sowell article you linked to. Do you see any connections? Probably not.



That is plan garbage. You believe that data only comes in the form of graphs, charts, or tables and that it cannot be presented through exposition. You present charts and graphs that do not support your claims and often have no direct causal connection or relationship to the argument you are making and believe you have presented relevant data. Paul Krugman is usually wrong, while Sowell is rarely, not only with the data but with the analysis and conclusions he makes.

tashi deleks,

M

As I stated read page 1 of the article. When you read, as you suggest you enjoy reading ... you will see the study says it a codeterminant as I copied and pasted for you. I make it the single most important factor, as other countries running a current account deficit experienced the same housing bubble. They did not have Barney Frank. See PIIGS data.

BTW ... who should I believe ... your propagandist video's ... or a real life study of economics? If you want a propagandist agenda keep posting videos doling out propaganda. If not get some data from economic studies.

Originally Posted by michael h

As I stated read page 1 of the article. When you read, as you suggest you enjoy reading ... you will see the study says it a codeterminant as I copied and pasted for you. I make it the single most important factor, as other countries running a current account deficit experienced the same housing bubble. They did not have Barney Frank. See PIIGS data.

I heard this a million times and Cons just can't deal with it.

Originally Posted by USCitizen

I heard this a million times and Cons just can't deal with it.

I won't deny some of the loan practices contributed ... but the reality was that monies from job exports (China Surplus) returned to the US and spurred the housing boom as they rightfully should have been invested in the creation of jobs. America avoided facing high unemployment for years due to China investment. The manufacturing jobs were gone period, and while the bust hurt the economy it was nice to friggin work another 7 years. Without China's investment we would have been faced with the immediate reality of a fucked economy. It's the ultimate double edged sword face reality in 2002 or face reality in 2008. Either way the health of Americas economy was exported for the interests of a few.

Originally Posted by michael h

I won't deny some of the loan practices contributed ... but the reality was that monies from job exports (China Surplus) returned to the US and spurred the housing boom as they rightfully should have been invested in the creation of jobs. America avoided facing high unemployment for years due to China investment. The manufacturing jobs were gone period, and while the bust hurt the economy it was nice to friggin work another 7 years. Without China's investment we would have been faced with the immediate reality of a fucked economy. It's the ultimate double edged sword face reality in 2002 or face reality in 2008. Either way the health of Americas economy was exported for the interests of a few.

It took about 6 years for Main Street to forget the dot com bubble.
I predict it will take about the same amount of time for enough people to forget about late 2009 and start the next bubble.

At least the dot com bubble wasn't coupled with such horrendous trade agreements and congressional legislation.

The fact remains that a smal segment of finaciers always get wealthier off of others people willingness to turn a blind eye to inflated instruments.

Originally Posted by USCitizen

It took about 6 years for Main Street to forget the dot com bubble.
I predict it will take about the same amount of time for enough people to forget about late 2009 and start the next bubble.

At least the dot com bubble wasn't coupled with such horrendous trade agreements and congressional legislation.

The fact remains that a smal segment of finaciers always get wealthier off of others people willingness to turn a blind eye to inflated instruments.

You make the most valid point to make ... globalism will not allow for a simple fix of the economy. Stimulus plans will mostly stimulate China's economy as they produce our goods and services. This is why the stimulus was given to the states to balance their budgets ... our congress knew they couldn't stimulate a non manufacturing based economy ... hence the bluff of a stimulus. Hence Presidential candidates will not discuss job creation in depth. Expect a lot of I'll fix this economy ... I'll be a jobs President ... I'm going to make sure we cut the red tape ... I can fix this because I'm not an insider ... we need to lower taxes on corporation ... they are to high (13%), I' ll change the tax code, blah blah

michael,
Worse than that is a possible result of the massive riots all over China.
Two months ago the American press slipped up and reported 72 riots across China for better working conditions and better wages.
The story was suppressed well within 24 hours.
I only knew about the story because someone posted the link on the Dice forums.

If the Chinese get their way, either prices will become unsustainable or China will be drenched in blood or corps will be seeking out the next slave nation and pass along the cost to their major consumer - America.
It seems inevitable that if O and Congress don't recognize this, we will have anarchy.

Originally Posted by USCitizen

michael,
Worse than that is a possible result of the massive riots all over China.
Two months ago the American press slipped up and reported 72 riots across China for better working conditions and better wages.
The story was suppressed well within 24 hours.
I only knew about the story because someone posted the link on the Dice forums.

If the Chinese get their way, either prices will become unsustainable or China will be drenched in blood or corps will be seeking out the next slave nation and pass along the cost to their major consumer - America.
It seems inevitable that if O and Congress don't recognize this, we will have anarchy.

I think China's citizens are learning that the movement of corporations there wasn't a humanitarian issue ... it remains bottom line.

Originally Posted by michael h

taxation.

elaborate

Originally Posted by jviehe

elaborate

Taxation funds government, government is greedy, as is our elite. Income shifts and the wealthier earn more. To provide a taxbase for agendas desired by elite interest government agendas ... we end up nailing those who make more. Government policy shifts the tax base. Government nails those it can.

Military/defense spending goes up almost 100 billion in a year to 960ish billion and other things are cut to pay for it.
Government legislation says so. If you squeeze those who don't have shit left to live on ... you may damage government agenda. If we didn't waste what we tax and export jobs ... we could fund government.

So Buffet says tax me ... he ain't making 100,000 or 250,000 nor is he being taxed at the same rate as those who do. He doesn't care ... will he call for defense cuts? No, corporate agenda is government agenda ... economic and military imperialism must be paid for. Shit happens and as long as the middle class doesn't benefit from jobs exports ... you will be taxed heavier.
The middle class must be squeezed slow ... Wisconsin may have proved to fast. USPS is an example of how you squeeze unions properly. Squeeze to fast and people will be in the street tearing shit up.







Social and Economic Inequality in the United States | West Coast Poverty Center

Sociology Roofus Seagull

Originally Posted by michael h

I can't seem to express it and make it understood. Maybe Buffet can help some get it and understand the pampering going on, as he submitted his own tax bill for examination.

Buffett: Stop coddling the super-rich - Business - Personal finance - msnbc.com

Stop coddling the super-rich, Warren Buffett says
Billionaire urges lawmakers to raise taxes on rich to help cut budget deficit

Jason Reed / Reuters
Warren Buffett has urged U.S. lawmakers to raise taxes on the country's super-rich to help cut the budget deficit, saying such a move will not hurt investments.
updated 8/15/2011 11:07:11 AM ET


Billionaire Warren Buffett urged U.S. lawmakers Monday to raise taxes on the country's super-rich to help cut the budget deficit, saying such a move will not hurt investments.

"My friends and I have been coddled long enough by a billionaire-friendly Congress. It's time for our government to get serious about shared sacrifice," The 80-year-old "Oracle of Omaha" wrote in an opinion article in The New York Times.


Buffett, one of the world's richest men and chairman of conglomerate Berkshire Hathaway Inc , said his federal tax bill last year was $6,938,744.

"That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income - and that's actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent," he said.

Lawmakers engaged in a partisan battle over spending and taxes for more than three months before agreeing on August 2 to raise the $14.3 trillion U.S. debt ceiling, avoiding a U.S. default.

"Americans are rapidly losing faith in the ability of Congress to deal with our country's fiscal problems. Only action that is immediate, real and very substantial will prevent that doubt from morphing into hopelessness," Buffett said.
Story: 3 ways to get more return on your savings

Buffett said higher taxes for the rich will not discourage investment.

"I have worked with investors for 60 years and I have yet to see anyone - not even when capital gains rates were 39.9 percent in 1976-77 - shy away from a sensible investment because of the tax rate on the potential gain," he said

"People invest to make money, and potential taxes have never scared them off."

So not arbitrarily confiscating more of their money is coddling them? You are such a nurturer.

Originally Posted by CharlesDavenport

So not arbitrarily confiscating more of their money is coddling them? You are such a nurturer.

It's not arbitrary. The purpose of taxation is to pay for government spending.
Sometimes you defer payment, in the case of an emergency.
Sometimes you defer payment, to skip out on the bill.
The Reagan and Bush tax cuts were the "skipping out on the bill" kind.
People running up a tab they didn't want to pay for and not paying for it.
As opposed to the deficits of the world wars, which were emergency spending.
Those deficits of the Reagan and Bush administrations creation, were deficits of choice. Deficits created for the purpose of making it appear we had a crisis, that could be used as a tool to repeal social legislation. They are the self destruction of the system based on internal flaws.
The current deficits are the result of an emergency resulting from a collapse of the financial system, and they are partly the deficits created to produce the theatre of a crisis.

Originally Posted by goober

It's not arbitrary. The purpose of taxation is to pay for government spending.
Sometimes you defer payment, in the case of an emergency.
Sometimes you defer payment, to skip out on the bill.
The Reagan and Bush tax cuts were the "skipping out on the bill" kind.
People running up a tab they didn't want to pay for and not paying for it.
As opposed to the deficits of the world wars, which were emergency spending.
Those deficits of the Reagan and Bush administrations creation, were deficits of choice. Deficits created for the purpose of making it appear we had a crisis, that could be used as a tool to repeal social legislation. They are the self destruction of the system based on internal flaws.
The current deficits are the result of an emergency resulting from a collapse of the financial system, and they are partly the deficits created to produce the theatre of a crisis.

To be comparatively well off is a blessing. To be super wealthy a curse to be corrected by the TAX MAN !