US Government Shut Down - new elections for senate and house of rep.?

[Bill Angel]

I will add that I do not think it is ethically or professionally the time to fight this battle at budget time. In my opinion a congress that gambles with the nations credit in this way is derelict of duty and should be held legally accountable. It would not bother me in the least to see Boehner and Reid spending their off time in jail until a budget is passed.

It isn't necessary to impose that draconian a solution. The members of the House could force a vote on the funding bill via a Discharge Petition. See:

House Democrats Unveil Plan To Force End To Shutdown http://huff.to/1bF0hh5 via @HuffPostPol

Edited October 6, 2013 by Bill Angel

[overtone]

 

 

If Obama won as a liberal

He didn't. He won as a rightwing conservative.

 

 

But all liberals are not trustworthy pillars of society, and all conservatives are not drunken bigots.

So?

 

The problem we face with the current Republicans has nothing to do with "liberal" of "conservative". They have no such ideology. Day in, day out, their only consistent political position is that rich people should pay less tax.

 

 

 

At least conservative values put some value on what good people have already struggled and died for to establish for the rest of us.

Liberalism is one of the high value things that good people have struggled and died to establish for us all. It should be valued more, and slandered less.

 

But regardless, "conservative" anything is not involved here. We are talking about a major political Party that has been captured by a lunatic fringe it was using to gain otherwise unobtainable power. The current Republicans aren't conservative - they're crazy, incompetent, incoherent wingnuts living in a fantasy world of their own invention.

 

 

 

But the point, is that IF there is a five percent that is best suited to run the place, they are not going to be able to, if they can not win an election. And since the majority is not amoung the top 5 or 10 percent, the top 5 or 10 percent have to Gerrymander the place, to set it up, so they have more political say, than their numbers would permit.

You seem to be confusing intelligence with wisdom and knowledge, and stupidity with ignorance and foolishness.

 

There is no such thing as a 5% elite that is better able to run this country - and for anyone who justifies Repuiblican jerrymandering as a way to get the best and the brightest into power, or the suburban professional as the type of person best suited to run everybody else's lives or the best voter for same, recall who voted - twice - for:George W Bush. (and before him Reagan, and after him Palin). Those people are not capable of governing this country, or recognizing those who are - that's been proven.

 

 

 

We have to spend, as a federal government, less

No. We have to spend more, and pretty soon - underspending by the Fed has dominoed into cutbacks at all levels of government, and threatens to leave the economy stagnant just when the bills will come due for the Republican crashing of the economy.

 

The very rich do have enormous piles of cash and wealth they gained from this scamming, and we could take that, but it's much easier to tax an income stream.than wealth in possession.

 

 

 

Inequities are indeed disturbing, but realistic workable avenues to address them, have been attempted in both our societies, to some large degree of success,

In America the avenues established to address and curb inequality have been largely repealed, starting in the 1980s. The resulating dramatic growth of inequality has now brought it to pre-Great Depression levels.

 

 

 

In my opinion a congress that gambles with the nations credit in this way is derelict of duty and should be held legally accountable

The only people in Congress who have set out to gamble with the nation's credit, for the third or fourth time now, have been the current Republicans. .

[EdEarl]

No. We have to spend more, and pretty soon - underspending by the Fed has dominoed into cutbacks at all levels of government, and threatens to leave the economy stagnant just when the bills will come due for the Republican crashing of the economy.

I believe we are spending too much on the wrong things, and not enough on the right things. The wars on drugs, in Iraq and in Afghanistan have been extremely expensive and have been a waste of money. If that money had been spent on infrastructure, we could have lots of green power, safe bridges, better roads, etc. In turn, our economy would be stronger and our debt might be smaller.

[tar]

Overtone,

 

My point was that a rich person's wealth is not yours or mine to control.

 

Especially when any attempts wind up thwarting any efforts for a average person to become wealthy.

 

The ACA was put together with the insurance companies still at the heart.

 

Companies do not owe healthcare to their employees, anymore than they owe free food and housing, or education.

 

When I joined my company, 25 years ago, I chose them partially because they offered benefits. It was part of my compensation. It was a perk. The government can set minimum wage but they can't force a company to offer perks.

 

It is not a company's responsibility to take care of its employees. It is the emloyee's responsibility to do the job the company is employing them to do.

 

I was let go from my company when my dept moved to Atlanta, and I did not wish to move so far away from my Dad, or ask my wife to leave her job in NYC. For four months I had the opportunity to NOT have an employer. It is difficult to build up from nothing, an offering that people would pay for. To be a business in your own right, to offer value, for a charge. I put in applications to continue in the industry I knew, and studied for and passed the GMAT and applied to a local university to achieve a masters in organisational behavior, so that I might have the credentials and knowledge to offer value to organisations. My wife did not think the large investment in tuition that would be required, would have a payback, at my age (59) and her salary alone would not be enough for us to even pay the mortgage and the bills, much less tuition for me. So when another group in my former company offered me a position, at less than I was previously making, I took the spot. Stayed under my wifes policy that I joined 3 months into my unemployment. But the point, is that it is difficult to "make money", on your own. You have to take risks and make investments, and have a plan, and build an enterprise, and keep it functioning. And you have to offer something that is better than, or other than, what is currently available on the market.

 

Money does not fall from the trees, and "making a living", is a fact of life. My life is not anyone elses responsibily. And I am not entitled to ANY way of life, but through my own efforts and associations.

 

You speak of the super wealthy as if they have something that you are automatically entitled to take by force or law. This is simply not the case. Their wealth was accumulated and effort was made to invest it wisely. It was husbanded. It was created through effort and plan. Sweat and tears that you did not shed, make it their's and not yours.

 

Someone who makes a higher salary than you, already pays more taxes than you do. It is not yours to say they can or should pay even more. And certainly not yours to step into their board room and dictate employee compensation.

 

You speak of the businesses and wealthy and owners of the means of production, as if they are on some other team, and have no heart or soul or brains.

 

I challenge you to provide for me, and for you, by pulling money out of thin air.

 

Regards, TAR

 

P.S. The Federal Reserve is pulling money out of thin air, and we are yet to experience the consequences. And its not you and me that are getting to spend it. But our savings are certainly being hurt.

[iNow]

Actually, your savings would be more hurt right now were it not for the Fed's policies of quantitative easing, and more spending now is precisely what we need as demand is low and interest rates remain pushed against the zero lower bound, but alas... who cares, right? This thread is no longer even remotely on topic. None of this has anything whatsoever to do with the shutdown. It merely shows how unfocused and tangential the american populace has become. Look, a bicycle!!

[swansont]

Companies do not owe healthcare to their employees, anymore than they owe free food and housing, or education.

They owe you compensation, i.e. wages or salary, so that you can get these things for you and your family. They can offer you benefits in lieu of (more) cash, and in the US it's economically advantageous to do so — the companies get a tax write-off that they would not have if they simply offered you more money.

[doG]

It isn't necessary to impose that draconian a solution.

It's not draconian. Our civil service people face such accountability in their jobs and congressmen are no better.

The only people in Congress who have set out to gamble with the nation's credit, for the third or fourth time now, have been the current Republicans. .

 

The debt ceiling quarrel happens every year. You're saying it's always the republicans? Open your eyes, both sides play this game.

[swansont]

 

The debt ceiling quarrel happens every year. You're saying it's always the republicans? Open your eyes, both sides play this game.

 

Um, no. Debt ceiling increases were pretty mundane until the most recent time the GOP took over the house.

 

http://www.newrepublic.com/article/115033/boehner-abc-still-demanding-debt-ceiling-negotiations

 

Under the Gephardt rule, the debt limit went up just as soon as the budget resolution passed. But Republicans repealed the Gephardt rule in 2011, right after taking power. A few months later, they were threatening to allow default if Obama didn’t meet their demands.

 

[jduff]

Obama just hit a new low in my book concerning the shutdown. Total retardation with this administration. Look for yourself, Amber Alert website:http://www.amberalert.gov

 

Then Michelles "Lets Move" website: http://www.letsmove.gov/

 

Truly retarded administration there. When I go to work today, going to make sure to point that out to my co-workers. They are going to love it! As this shutdown continues. Makes me not want to vote a democrat into office next year. With the sheer stupidity of this administration!

Edited October 7, 2013 by jduff

[Cap'n Refsmmat]

Obama just hit a new low in my book concerning the shutdown. Total retardation with this administration. Look for yourself, Amber Alert website:http://www.amberalert.gov

 

Then Michelles "Lets Move" website: http://www.letsmove.gov/

 

Truly retarded administration there. When I go to work today, going to make sure to point that out to my co-workers. They are going to love it! As this shutdown continues. Makes me not want to vote a democrat into office next year. With the sheer stupidity of this administration!

Hold your horses. The Amber Alert system is still functioning -- it's run by local police departments, not the federal government, and they can still issue alerts. The informational website about the system is down, that's all.

 

The current list of active Amber Alerts is not kept by the federal government, either:

 

http://www.missingkids.com/Amber

 

Hanlon's Razor would suggest that Michelle Obama's website is still up because it is run by a different federal agency whose bureaucrats have interpreted the rules differently. There's no single administration official running down a checklist of websites and deciding "no, screw the missing kids -- but keep Let's Move, that's important!"

[Endy0816]

Yeah, "Let's Move" falls under the White House, which makes sense considering. Looks to be on a commercial server anyways. Already payed for, no real point in killing it.

[Ringer]

Hold your horses. The Amber Alert system is still functioning -- it's run by local police departments, not the federal government, and they can still issue alerts. The informational website about the system is down, that's all.

 

The current list of active Amber Alerts is not kept by the federal government, either:

 

http://www.missingkids.com/Amber

 

Hanlon's Razor would suggest that Michelle Obama's website is still up because it is run by a different federal agency whose bureaucrats have interpreted the rules differently. There's no single administration official running down a checklist of websites and deciding "no, screw the missing kids -- but keep Let's Move, that's important!"

And that is the exact problem with American politics. It's a huge cognitive bias finger pointing game. No one cares about actual results. IMO who started this fuster cluck doesn't matter (though it's obvious who's at fault) the problem is those who started this mess refuse to look past their own d*cks (or t*ts) to see they're making everything worse because they listen to the loudest.

[Phi for All]

Obama just hit a new low in my book concerning the shutdown. Total retardation with this administration. Look for yourself, Amber Alert website:http://www.amberalert.gov

 

Then Michelles "Lets Move" website: http://www.letsmove.gov/

 

Truly retarded administration there. When I go to work today, going to make sure to point that out to my co-workers. They are going to love it! As this shutdown continues. Makes me not want to vote a democrat into office next year. With the sheer stupidity of this administration!

 

The problem with your "sheer stupidity" detector is that you're using the 180 degree setting and pointing it only where you want. To be truly effective, you need 360 degree coverage.

And that is the exact problem with American politics. It's a huge cognitive bias finger pointing game. No one cares about actual results. IMO who started this fuster cluck doesn't matter (though it's obvious who's at fault) the problem is those who started this mess refuse to look past their own d*cks (or t*ts) to see they're making everything worse because they listen to the loudest.

 

I see your point here but I think it's more than just two sides finger-pointing. Boehner got backed into a corner by the Tea Party but the media is backing the whole Republican party into a corner. Even news outlets that are supposedly more liberal continue to talk about compromise and report each time Boehner asks for a chance to sit down and negotiate. They use cutesy pics of boxing gloves popping out of both the White House and Congress, making it seem like a legitimate fight is taking place. It gives the impression this is a battle which will be won through persistence, toughness and dedication, not that this is a completely inappropriate, ineffective and desperate gambit that threatens to undermine our political process, and lose what grounds we've gained economically.

 

The media aren't using the more appropriate graphic of Cruz holding a gun to Boehner's head while Boehner holds a gun to the President's head, while the President stands with the Executive, Legislative and Judicial branches of government firmly behind him, telling them, "There is nothing to negotiate, this deal's been done". When vandals smear feces on a statue, the media should just call them vandals instead of trying to be fair and say they might just be sloppy organic gardeners.

 

The media has made this all about perseverance and pride and whose dick is bigger, all of which are completely at odds with what is actually happening to the country. It's obvious to me that this fake impartiality must increase ratings and give the illusion of fairness. It sure does lengthen the news cycle and insure more internecine posturing, which just makes the cycle even longer and more lucrative.

[swansont]

Only the parts of the government that rely on FY14 appropriated funds are shut down. Benefits, like social security, do not rely on appropriations. Something that was funded in FY13 who still have money are not affected until that money runs out. Anyone in that situation is exempt from the shutdown. Websites being up or down will depend, in part, on how they are funded.

 

Within the parts of government that are shut down, personnel who are critical for safety are excepted from the shutdown. That includes all the people Hagel called in to work today who had previously been furloughed. We (They) can't take any sort of leave while in this status. No vacation, no sick leave. Had a plane ticket to go on a trip? Sorry, you have to eat that expense and come in to work.

 

edit: learned more about the DoD recall. It seems we may be in a paid status, not excepted. Still not sure if we can take leave, and it seems this all goes away if we hit the debt limit.

[overtone]

 

 

And that is the exact problem with American politics. It's a huge cognitive bias finger pointing game. No one cares about actual results

Not really. What it's more like is a huge cognitive bias attempt to avoid accountability, by some people who have done some really objectionable and damaging things to the government and country they were supposed to be taking care of.

 

We need more fingerpointing, and more serious fingerpointing, at the perpetrators of the disastrous scams of the past couple of decades. We could even use a subpoena or two, and some gavel banging to go with it.

[Tridimity]

When vandals smear feces on a statue, the media should just call them vandals instead of trying to be fair and say they might just be sloppy organic gardeners.

 

 

Phi, that's the best analogy I've heard in ages

[doG]

 

Um, no. Debt ceiling increases were pretty mundane until the most recent time the GOP took over the house.

 

http://www.newrepublic.com/article/115033/boehner-abc-still-demanding-debt-ceiling-negotiations

 

 

[iNow]

That response seems tangential to the point, though. Which sides of the aisle used these increases to achieve ends they could not achieve through normal constitutional and legislative processes?

[waitforufo]

Sorry, I was too busy enjoying my day yesterday and I forgot to give my government shutdown update, so I will have to combine it with today.

Shutdown day 6 and 7:
The shutdown still has had no impact on my life or the lives of anyone I know.

I guess that is not too big of a surprise. 83% of the government is still functioning so their can't be too many people that have been impacted.

I'm glad to see the government can still find money to do things like the one shown in the following link.

http://siouxfallsbusinessjournal.argusleader.com/article/20131004/UPDATES/310040047/S-D-officials-object-feds-barring-visitors-from-highway-viewing-areas-near-Mount-Rushmore

I'm wondering what it cost to put out all of those cones so that people couldn't stop and take a few snaps. I appreciate how egregious that would be considering that it would cost the government nothing. Meanwhile back in Washington D.C. the national mall will be open for an immigration reform rally. I'd love to hear the logic for stopping people from taking snaps yet opening the mall for a rally.

http://washingtonexaminer.com/park-service-oks-immigration-reform-rally-on-closed-national-mall/article/2536908

I'm glad to see that all those military contractors went back to work. Non-essential one day essential the next. Didn't even need a phone call to Harry Reid.

 

Actually, your savings would be more hurt right now were it not for the Fed's policies of quantitative easing, and more spending now is precisely what we need as demand is low and interest rates remain pushed against the zero lower bound, but alas... who cares, right? This thread is no longer even remotely on topic. None of this has anything whatsoever to do with the shutdown. It merely shows how unfocused and tangential the american populace has become. Look, a bicycle!!

You know, people that save their money are generally concerned about more than right now. That is why they save. They are worried about the future. So the government is creating conditions where savers are loosing money because of a devalued dollar and are earning no interest, but they should consider quantitative easing to be a good policy? Tell that to retired people living on their savings. Yeah, Yeah, I know, Those people have money so screw them.

Don't expect quantitative easing to stop any time soon or ever. If interest rates go up to modest levels common during a robust economy, say 5 to 6 percent, almost all income taxes collected will be needed just to pay the interest on the national debt. Quantitative easing is just printing money to make national debt interest payments. We are past the point of no return. We can't grow the economy because it will kill the environment, we can't pay our debt so we print money. But for right now that’s better (easier) than fixing our problems so screw tomorrow.

[Phi for All]

 

Phi, that's the best analogy I've heard in ages

 

I wish I could claim it. I paraphrased it from somewhere.

[swansont]

And? Any of these have a threatened shutdown, or actual shutdown?

 

 

I'm glad to see that all those military contractors went back to work. Non-essential one day essential the next. Didn't even need a phone call to Harry Reid.

Contractors? If you mean the DoD civilians, that's the result of the pay our military act being passed, i.e. an appropriations bill. The military and civilian employees in support of the military are funded. Probably contractors, too. Boehner still won't call a vote on a clean CR, though.

[Ringer]

I see your point here but I think it's more than just two sides finger-pointing. Boehner got backed into a corner by the Tea Party but the media is backing the whole Republican party into a corner. Even news outlets that are supposedly more liberal continue to talk about compromise and report each time Boehner asks for a chance to sit down and negotiate. They use cutesy pics of boxing gloves popping out of both the White House and Congress, making it seem like a legitimate fight is taking place. It gives the impression this is a battle which will be won through persistence, toughness and dedication, not that this is a completely inappropriate, ineffective and desperate gambit that threatens to undermine our political process, and lose what grounds we've gained economically.

[snip]

I may have been a bit too vague. I agree with what you're saying 100%, I was only focusing on that people in general are only seeing a single problem and trying to show how the party they agree with isn't at fault (or, more often, do mental gymnastics to show the other people are at fault). Solving a problem doesn't matter, so long as you look good doing it many voters don't give two *excrement* what actually happens. There was an interview between Bill O'Reilly and Jon Stewart where Stewart made this same point quite well.

 

 

Not really. What it's more like is a huge cognitive bias attempt to avoid accountability, by some people who have done some really objectionable and damaging things to the government and country they were supposed to be taking care of.

 

We need more fingerpointing, and more serious fingerpointing, at the perpetrators of the disastrous scams of the past couple of decades. We could even use a subpoena or two, and some gavel banging to go with it.

If finger pointing actually got some result I would agree. The fact is, sadly, our the people in our government are not held accountable for what they screw up, even if it is criminal.

[iNow]

So the government is creating conditions where savers are loosing money because of a devalued dollar and are earning no interest, but they should consider quantitative easing to be a good policy?

 

Yes, they should, because the alternative would be MUCH worse.

 

QE is what's preventing even worse slow down and even lower demand. QE is one of the few things actually keeping the economy moving right now because borrowing costs are so attractive to businesses, homeowners, and others who are looking to make capital investments in heavy equipment and infrastructure.

 

Additionally, a slightly devalued dollar makes our exports much more attractive which would have a stimulative effect in a major why (why do you think China has done so well with their exports through the last decade? because they depressed the value of their currency!). Increased exports would mean MORE production and MORE people back to work. That's a good thing... Demand for our products would go up, and consequently so would the number of jobs, and those people with jobs would spend that money at other businesses and all of this would result in a multiplier effect, except this time in the correct direction... upward.

 

Further, commodity prices were rising well before QE began, and if anything have been flat since the Fed began expanding its balance sheet. Same is true for headline PCE. It's been horizontal since these Fed policies began, not upward.

 

http://economistsview.typepad.com/timduy/2012/09/if-qe-causes-commodity-price-inflation.html

Bottom Line: If anything, inflation is lower, both for commodity prices and headline PCE, after quantitative easing. So isn't it finally time to put to rest the myth that quantitative easing is causing runaway inflation? Nothing to see here folks, move along.

 

 

You are, quite simply, wrong. In normal times, you'd probably have a valid argument here. In normal times such expansions of the Fed balance sheet would result in a weakened dollar and massive inflation, but these are NOT normal times with global demand at depression era lows and interest rates already cut to zero... Hence the logic you are using (repeating? parroting? misrepresenting?) does not apply in these circumstances.

 

http://krugman.blogs.nytimes.com/2012/08/25/inflation-lessons/

For if you believed a demand-side story, you would also believe that even a large monetary expansion would have little inflationary effect; if you believed a supply-side story, you would expect lots of inflation from too much money chasing a reduced supply of goods. And indeed, people on the right have been forecasting runaway inflation for years now.

 

Yet the predicted inflation keeps not coming.

 

Interestingly, since you're so concerned about the value of the dollar, I wonder why you're so damned happy (like a pig in shit?) about the current shutdown and prospect of not raising the debt ceiling... Both of which are tanking the dollar relative to other currencies right now.

 

http://www.bloomberg.com/news/2013-09-29/dollar-extends-drop-against-yen-with-government-shutdown-looming.html

The dollar fell against the majority of its most-traded peers as political wrangling about the U.S. budget threatened a partial government shutdown.

 

http://www.fxstreet.com/analysis/daily-fx-market-roundup/2013/09/30/

The dollar index lost more than 2% of its value since the beginning of September in anticipation of the dysfunction in Washington.

Not to mention that it hasn't tanked as severely as you continue to suggest since QE began in 2009, but has instead experienced fairly standard spikes and troughs along the way with only a slight downward overall trend:

 

 

 

Tell that to retired people living on their savings. Yeah, Yeah, I know, Those people have money so screw them.

 

You can continue arguing against caricatures all you want, but it adds neither legitimacy nor credibility to your position. Nobody here (and probably in most other places, frankly) have made any arguments even resembling this statement above, but if it makes you feel better to setup and knock down strawmen, then by all means enjoy yourself.

 

Don't expect quantitative easing to stop any time soon or ever.

 

Actually, there was a very real chance that it was going to slow down last month in September, but the continued lack of fiscal efforts from congress (plus continued nonsense like these shutdowns and ideas that we shouldn't pay our debts by raising the debt ceiling) anchored the economy too much and it was unwise to begin tapering this quarter.

 

Most likely, we'll see tapering begin in mid-2014 (I think it's unlikely to happen in either December or February, myself), but the real threshold here is 6 months straight of positive employment numbers. Once we see that, it's absolutely rational and reasonable to "expect quantitative easing to stop any time soon."

 

http://economistsview.typepad.com/timduy/2013/09/resetting-expectations.html

The Fed appears to want to shift away from asset purchases in favor of forward guidance and is looking for the right time to begin that process. Their modus operandi has been to see six months of good employment data, send up a warning flag that the end of policy accommodation is coming, and then back down when the data turns weaker in the next three months.

 

If they continue that pattern, then we could be looking at mid-2014 before enough evidence of sustainability emerges that the Fed feels confident they can taper. But if they are on a knife edge now, they may only need two or three months of good data to taper.

 

Quantitative easing is just printing money to make national debt interest payments.

 

Well, no. It's not "just" that, it's not "that" at all, actually.

 

You're basically repeating a myth when you say that QE is "printing money," and another myth when you say it will "lead to inflation." If you wish to argue against these programs and policies, then please at least put forth a modicum of effort to accurately understand them first.

 

http://www.washingtonpost.com/blogs/wonkblog/wp/2012/09/13/qe3-what-is-quantitative-easing-and-will-it-help-the-economy/

Normally, when there's a recession or the economy is limping along, the Federal Reserve will reduce short-term interest rates in order to spur more lending and spending. But right now, the Fed has cut interest rates as far as they can go and the economy is still struggling. This is known as the "zero bound." The Fed can't go any lower.

 

So, instead, the central bank can try quantitative easing. Since the Federal Reserve can just create dollars out of thin air, it can buy up assets like long-term Treasuries or mortgage-backed securities from commercial banks and other institutions. This pumps money into the U.S. economy and reduces long-term interest rates further. When long-term interest rates go down, investors have more incentive to spend their money now.

There is more at the link below if you have any interest in correcting your misconceptions (this one is good because it directly rebuts the exact myths you're continuing to spout here):

 

Taper Tantrums: 3 Myths about Quantitative Easing

http://business.time.com/2013/09/18/taper-tantrums-3-myths-about-quantitative-easing/

 

 

You mentioned also how a focus on the environment is killing the economy. That's a massive canard, but I will respond briefly by sharing that it doesn't matter how much gold you have if the air is so polluted that we cannot breath, find drinkable water, or grow enough crops to feed us all. Unless perhaps you think you can eat your gold, I think you should consider adding some perspective and validity to your hyperbole and ideology.

 

Edited October 8, 2013 by iNow

[tar]

iNow,

 

When have you known any strategy to not have unintended consequences.

 

I am not sure exactly how the consumer price index chart you showed reflects increases in insurance payments, health care, gas prices and asset prices that have occured in recent years.

 

Money is a store of value, and if you "create" 85 billion dollars a month, there has to be some effect on the value of money that is currently held. Whether it is minted in coins, on printed on paper, or written in magic marks on the Feds, balance sheet. The Fed now owns a lot of assets, and has to, at some point, unwind and reduce the size of their balance sheet.

 

It is not a myth, that the banks have been able to unload somewhat questionable paper on the Fed, to increase the stability of their own balance sheets. The vigils against Wall Street had some reasoning behind them, as that it seems rather unfair that banks should be able to get more than market value for bad loans, AND be able to borrow money from the Fed at 1/2 percent, so that they can loan it back out, to GOOD risks, at 5 or 4 or 3.5 percent rates. And my credit cards are charging me a bit more than that.

 

It is not a myth, that the middle class has gotten weaker and the upper middle, or higher class has gotten stronger. Asset prices have gone up. The stock market is nearly at twice the levels it was at the depth of the recession. Quantitative easing was and is an untried strategy, with unknown consequences, given the propensity of people to make their best move. It bothers me a bit that such a huge amount of money is created every month, and I get NONE of it. It bothers me that the market has gone up, and up and up, when the economy has been just crawling along, with jobs scarce, and employees "stuck" in their spots, living from paycheck to paycheck.

 

And now the Fed is stuck. They can not allow interest rates to rise, or we can't pay our debts. This summer they announced an intention to start tapering the amount of easing, and the market sold off, and interest rates started to climb, and they immediatly reversed, and promised the punch bowl would be available for the forseeable future and the market recovered and kept rising, in the face of bad economic news, threats of action in Syria, Italian governmental problems, and now even with the budget deadlock, the market is not concerned, because "don't fight the Fed" is a powerful rule, and 85 billion a month, has to wind up somewhere, and since you can't make much money, keeping what you have in the bank, owning steadily rising assets as in stocks, is currently the best play in town.

 

What is interesting, and scary to me, is that historically, at the end of a bull run, the retail invester shows up, and the smart money, sells everything that is not nailed down. I have heard on Bloomberg in the last few weeks, that the retail invester is returning to the market.

 

So even if we avoid the default of our government, which I think we will, because we have to, we are still in a tough situation, where less government spending and higher taxes for us all, are going to be required. We can't grow out of our debt problems, when we are barely growing at all.

 

We have some structural problems, and we have some dependence problems, and I think we should be addressing them both. You might have seen the 60 Minutes on the huge amount of people on disability in West Virginia and Tennesee and Ohio.

 

I am rather sure we will make it through this crisis, but I don't think we should rely on government programs quite so much as we do. The situation with the disability claims, reminds me of when the neighbor gets together and forms a neighborhood watch, and everybody is all in and all excited about it, for about a week, and then it falls apart. Nobody is watching what these government programs become, when they become "the law of the land", and the system is then gamed.

 

Regards, TAR2

I think we will make it all right, because of that famous rule that America will ALWAYS wind up doing the right thing, once all other options are exhausted.

[waitforufo]

Tar,
Thank you for your rebuttal to iNow's post. I agree with you completely.

One item you could have perhaps added is that markets are supposed to rise with dollar devaluation. The value of a company does not change simply because the government is printing money. That's one of the reasons people buy stocks. So wealthy people own stocks, the poor don't, and the middle class has most of their money in savings or bonds. By owning stocks wealthy people are protected but the poor and middle class are not. Printing money devalues savings and bonds. Printing money simply increases the wealth gap that liberals are always crying about.