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The Bailout... are you watching?


MichaelSaulnier
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Aside:

 

WalMart is the only company that has it's own self-contained infrastructure, or something like it. Consider the trucking companies are already going under; soon we'll see parts of distribution and retail collapsing as the links in the chain fail.

 

Note that you can already renew your license at WalMart. Register to vote; get a new tag; hail a police officer at substations located in some; flie your taxes...

 

Best Buy is going under; Circuit City already has. WalMart will step into that market a little bit, enough to cap it off, and we'll have no more independent consumer electronics outlets. This is the way *all* retail will end. WalMart will subsume all, and at the same time may keep the U.S. afloat by being the only infrastructure we have.

 

/ more zany talk

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As bleak as it may sound, I think the only way for the current system to right itself is to let the table fall. Then rebuild.



I think if we let it all fall then it really will be the end.
From my perspective, we have to get credit moving again. That means helping the banks.

Also, we need jobs. I don't think we can afford to let the auto industry fall. They do need to get serious about creating forward thinking vehicles, and I think they will because if they do get bailed out this time and fail to thrive I doubt they will ever get help again.

These are precarious times, but I do not believe the sky is falling. I think people and companies are capable of making the necessary adjustments when they have to.

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You cant fix it from the top down or the bottom up.

Like a tree the economy and what its made up of is highly interdepenant.

A tree will die without sunlight or lack of moist furtile soil.

 

Mans institutions are only a reflection of how a man percieves and deals with reality.

Since this has been an extremely volitile political cycle mans works have become manic or at least heavily distressed just like a tree looses leaves when the sunlights clouded, droubt occurs or the soil lacks nutrients. But we must look at the tree as a whole so we dont start loosing limbs or allow rot to enter the core if its going to flourish.

 

Econimic recessionis part of a cycle. Mans works can become Depressed or Elated the same way as man himself can or a tree goes through during seasonal changes. When the orbit between the Highs and Lows becomes oval vs circular they reach levels that are too extreme for many to survive.

 

Sunshine or furtile soil alone one without the other will kill a tree as it will kill an economy.

Whats been occuring is a seasaw effect. When one symptom occurs at one end the cure being given is at the other extreme making the whole thing unstable and destructive. Like Chlorine and Sodium, either will kill on their own but combined you get the salt of life.

 

What needs to be focused on is the ground thats between the two extremes, or the center of the seasaw where both extremes are in balance. Many are at a low now and will be destroyed without enlightenment to complete the cycle. Enlightenment cannot be forced or faked but continued Depression can destroy. Enlightenment requires Truth, Belief, Willingness, Positive Attitude, Guidence, plus a host of others in most cases to occur. Simply removing obsticals percieved or otherwise isnt enough for many who havent been there or done that before.

 

Luckily many can be saved from destruction because theres enough of us who lived through simular occurances like gas lines, wars, loss of income, recessions, politics etc. Theres is also well documented history of these items and the cures that occured as well.

Man is not created equal. Some have multiple gifts, some have one, some have none and some have no ability to incorperate their gift in their lives. We do have freedom to use them if we choose to for better or worse.

The question is will the inexperienced be led astray and get raped by the equally educated imorals at the end of that appears to be a safe well lit road. Or will they seek out and heed the advice of those who can be trusted and avoid those dead ends all together.

Most who do survive and grow will be enlightened by the fact that what got them through were exact things they've heard all their lives.

Maybe they got by without them by feeding off others or unwilling to incorporate them into their lives.

Hopefully if the enlightenment does occur, they will remember its grandure and pass it on so their children so they will be prepared to survive what we are experiencing now.

 

When our fixes based upon extended debt does crush them, will they be able to survive moral and financial destruction?

If they dont our bad decisions now will surely destroy us like it is for many of those who made poor choices in their past

and are being destroyed now.

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http://newsroom.ucla.edu/portal/ucla/FDR-s-Policies-Prolonged-Depression-5409.aspx?RelNum=5409

 

FDR's policies prolonged Depression by 7 years, UCLA economists calculate

By

Meg Sullivan

| 8/10/2004 12:23:12 PM

 

Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt.

 

After scrutinizing Roosevelt's record for four years, Harold L. Cole and Lee E. Ohanian conclude in a new study that New Deal policies signed into law 71 years ago thwarted economic recovery for seven long years.

 

"Why the Great Depression lasted so long has always been a great mystery, and because we never really knew the reason, we have always worried whether we would have another 10- to 15-year economic slump," said Ohanian, vice chair of UCLA's Department of Economics. "We found that a relapse isn't likely unless lawmakers gum up a recovery with ill-conceived stimulus policies."

 

In an article in the August issue of the Journal of Political Economy, Ohanian and Cole blame specific anti-competition and pro-labor measures that Roosevelt promoted and signed into law June 16, 1933.

 

"President Roosevelt believed that excessive competition was responsible for the Depression by reducing prices and wages, and by extension reducing employment and demand for goods and services," said Cole, also a UCLA professor of economics. "So he came up with a recovery package that would be unimaginable today, allowing businesses in every industry to collude without the threat of antitrust prosecution and workers to demand salaries about 25 percent above where they ought to have been, given market forces. The economy was poised for a beautiful recovery, but that recovery was stalled by these misguided policies."

 

Using data collected in 1929 by the Conference Board and the Bureau of Labor Statistics, Cole and Ohanian were able to establish average wages and prices across a range of industries just prior to the Depression. By adjusting for annual increases in productivity, they were able to use the 1929 benchmark to figure out what prices and wages would have been during every year of the Depression had Roosevelt's policies not gone into effect. They then compared those figures with actual prices and wages as reflected in the Conference Board data.

 

In the three years following the implementation of Roosevelt's policies, wages in 11 key industries averaged 25 percent higher than they otherwise would have done, the economists calculate. But unemployment was also 25 percent higher than it should have been, given gains in productivity.

 

Meanwhile, prices across 19 industries averaged 23 percent above where they should have been, given the state of the economy. With goods and services that much harder for consumers to afford, demand stalled and the gross national product floundered at 27 percent below where it otherwise might have been.

 

"High wages and high prices in an economic slump run contrary to everything we know about market forces in economic downturns," Ohanian said. "As we've seen in the past several years, salaries and prices fall when unemployment is high. By artificially inflating both, the New Deal policies short-circuited the market's self-correcting forces."

 

The policies were contained in the National Industrial Recovery Act (NIRA), which exempted industries from antitrust prosecution if they agreed to enter into collective bargaining agreements that significantly raised wages. Because protection from antitrust prosecution all but ensured higher prices for goods and services, a wide range of industries took the bait, Cole and Ohanian found. By 1934 more than 500 industries, which accounted for nearly 80 percent of private, non-agricultural employment, had entered into the collective bargaining agreements called for under NIRA.

 

Cole and Ohanian calculate that NIRA and its aftermath account for 60 percent of the weak recovery. Without the policies, they contend that the Depression would have ended in 1936 instead of the year when they believe the slump actually ended: 1943.

 

Roosevelt's role in lifting the nation out of the Great Depression has been so revered that Time magazine readers cited it in 1999 when naming him the 20th century's second-most influential figure.

 

"This is exciting and valuable research," said Robert E. Lucas Jr., the 1995 Nobel Laureate in economics, and the John Dewey Distinguished Service Professor of Economics at the University of Chicago. "The prevention and cure of depressions is a central mission of macroeconomics, and if we can't understand what happened in the 1930s, how can we be sure it won't happen again?"

 

NIRA's role in prolonging the Depression has not been more closely scrutinized because the Supreme Court declared the act unconstitutional within two years of its passage.

 

"Historians have assumed that the policies didn't have an impact because they were too short-lived, but the proof is in the pudding," Ohanian said. "We show that they really did artificially inflate wages and prices."

 

Even after being deemed unconstitutional, Roosevelt's anti-competition policies persisted

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