You are only looking at the immediate short termsinistertim101May 20 2012, 23:55:33 UTC
Austerity is the only way to recover long term.
If everyone defaults the banks go out of business and it wont matter if there is high consumer demand as businesses will still go under waiting to get paid as lines of credit freeze up. You can't keep your shelves filled without paying and then skimming the top margins after the products are sold.
Austerity will reduce demand short term but give plenty of capital left to banks and 401ks. They will in return lend to small business and us instead of government bonds.
Re: You are only looking at the immediate short termbrittdreamsMay 21 2012, 00:41:08 UTC
What? Why do you think the banks will go under? People already defaulted and the banks were given a bailout by the governments of the world to prevent them from going under.
Also, can you explain what you mean by short-term? And perhaps explain how this will affect the regular folks that are already struggling to survive? Because I'm not sure I give a damn how much capital is left in someone else's 401K (I don't have one so there can't be any in mine) when I barely have enough money to put healthy food on the table.
Re: You are only looking at the immediate short termnebrisMay 21 2012, 02:17:37 UTC
He's either a Libertarian jackoff who's ideologically [aka theologically] committed to this line or an actual 'austerity pimp' who's paying job it is to push this bullshit across the various blogs and comment threads.
Re: You are only looking at the immediate short termsinistertim101May 21 2012, 06:47:28 UTC
Yes the militant ladies thought I was a woman hater and a mean horrible person because I am 50% pro choice and 50% pro life depending on circumstances. Normally I do not reply like I did but do not appreciate being attacked.
I am somewhat conservative and this forum is open to all those with different economic schools of thought to Keynesians like Nebris to myself who favor the Austrian model.
Re: You are only looking at the immediate short termdarksumomoMay 21 2012, 11:37:28 UTC
"Keynesians like Nebris"--If you had been paying attention, you'd now that Keynesianism is to the right of where Nebris is. As for the Austrian School, you can find my opinion of it here.
Re: You are only looking at the immediate short termsinistertim101May 21 2012, 06:42:56 UTC
Just because I have a different opinion than yours does not mean I am being paid.
To me this is common sense and not ideology. This is a friendly economic group here with a different range of economic pieces of thought.
Yes, I am more conservative. However, I do not like the word conservative as it means spend and cut revenue which means more debt.
I agree in truth and reality and common sense. There is too much debt which adversely affects consumption. 1 trillion in student loans, 1 trillion in credit cards, and governments spending 2x more than their whole GDP is disaster. Economics 101 is not about money, but resources. Their is a scarcity of them. If you print more money the value of each dollar goes down as their is still limited resources.
So debt is bad and until you pay it the financial sector goes down with taking everyone down. You can't spend your way out of debt! You run out of other people's money. up. Why is that so bad?
Re: You are only looking at the immediate short termsinistertim101May 21 2012, 06:29:14 UTC
That 401k pays your salary, your education, your parents and grandparents social security and so on.
If that is gone then you can kiss it all goodbye. That is the big deal.
Greece has more debt than the whole country makes in a single year. Almost 2 years worth of GDP (all money by all its citizens combined). To keep paying its bills the country has to issue bonds and Wallstreet and all the major banks buy them.
With that kind of risk they want an interest rate to collect as they can use that given capital on other things. So normally they agree on 3% interest and its added to their national debt. When the bond matures Greece must pay back the principal plus the interest and that is how a bank makes money.
What is happening now is the debt is so huge they can't pay it. So what do the banks do? Raise the interest rates as their is more risk.
Now Greece has to pay even more money it doesn't have. This makes investors more nervous which raises interest again and so on and so on until a near collapse is immenent.
If everyone defaults the banks go out of business and it wont matter if there is high consumer demand as businesses will still go under waiting to get paid as lines of credit freeze up. You can't keep your shelves filled without paying and then skimming the top margins after the products are sold.
Austerity will reduce demand short term but give plenty of capital left to banks and 401ks. They will in return lend to small business and us instead of government bonds.
That is good for economic growth.
Reply
Also, can you explain what you mean by short-term? And perhaps explain how this will affect the regular folks that are already struggling to survive? Because I'm not sure I give a damn how much capital is left in someone else's 401K (I don't have one so there can't be any in mine) when I barely have enough money to put healthy food on the table.
Reply
~M~
Reply
(The comment has been removed)
I am somewhat conservative and this forum is open to all those with different economic schools of thought to Keynesians like Nebris to myself who favor the Austrian model.
Reply
Reply
To me this is common sense and not ideology. This is a friendly economic group here with a different range of economic pieces of thought.
Yes, I am more conservative. However, I do not like the word conservative as it means spend and cut revenue which means more debt.
I agree in truth and reality and common sense. There is too much debt which adversely affects consumption. 1 trillion in student loans, 1 trillion in credit cards, and governments spending 2x more than their whole GDP is disaster. Economics 101 is not about money, but resources. Their is a scarcity of them. If you print more money the value of each dollar goes down as their is still limited resources.
So debt is bad and until you pay it the financial sector goes down with taking everyone down. You can't spend your way out of debt! You run out of other people's money. up. Why is that so bad?
Reply
If that is gone then you can kiss it all goodbye. That is the big deal.
Greece has more debt than the whole country makes in a single year. Almost 2 years worth of GDP (all money by all its citizens combined). To keep paying its bills the country has to issue bonds and Wallstreet and all the major banks buy them.
With that kind of risk they want an interest rate to collect as they can use that given capital on other things. So normally they agree on 3% interest and its added to their national debt. When the bond matures Greece must pay back the principal plus the interest and that is how a bank makes money.
What is happening now is the debt is so huge they can't pay it. So what do the banks do? Raise the interest rates as their is more risk.
Now Greece has to pay even more money it doesn't have. This makes investors more nervous which raises interest again and so on and so on until a near collapse is immenent.
Here is the scary ( ... )
Reply
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