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Tuesday, September 11, 2012

Zuckerman Article Post

We apologize for the issue with blogger-it sometimes does not work well. Here is the link to the Zuckerman article:  http://online.wsj.com/article/SB10000872396390444273704577635681206305056.html

13 comments:

  1. Which, if any, of his 5 proposals to increase employment do you support?

    --David

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  2. Really? These are not all conservative ideas. The jobs bill that Congress refuses to pass would create jobs through three of his suggestions: infrastructure building, job training, and subsidies to companies that hire long-term unemployed…

    http://www.freakonomics.com/2011/09/09/obamas-jobs-bill-a-reasonable-plan/

    As for his other two suggestions, he doesn't say what "hurdles" he has in mind that the government puts in the way of new businesses, so I can't comment on that except to say that some hurdles are necessary for public safety. He needs to get specific here.

    And his fifth idea about providing more access to credit markets for small business takes us right back to the Wall Street banks, doesn't it? Why should they risk loaning money to small businesses in a fragile economic environment so long as the Federal Reserve is practically giving them trillions in nearly interest-free money which they can sock away in Treasuries or other safe investments with a guaranteed return and no risk. That's the problem. Too bad he didn't talk about it!

    --David (OWS)

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  3. Here's why you should join OWS. Today, the Federal Reserve announced their latest Wall Street bailout (otherwise known as "QE3"). While everybody seems preoccupied with other issues, the FED will be buying up $40 billion a month worth of Wall Street mortgage-backed securities from now to who-knows-when. So, does Zuckerman or anybody else really believe the banks will turn around and loan all this money to small businesses? No way. They will find a way to parlay it into their next derivatives scam or something. They are corrupt to the core, and Federal Reserve is stepping in again to clean up their mess. More to come! Everyone in America should read Ron Paul's "End the Fed" book.

    --David

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  4. I completely disagree with QE3. China used to be the biggest holder of US debt, now the Fed is. This is like moving $100 from your right pocket to your left pocket and think you just made $100. It is a ponzi scheme and it only will last for a short time before everything blows up.

    Zuckerman has it right that the banks must lend more money to small business, however, we need to get the Fed to stop playing fast and loose with our future.

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  5. One more thought on QE3…

    I saw an interesting statistic today. If the FED had taken all the money from QE1, QE2, and QE3 and given it directly to the American people, they could literally write a check for $7,000 to every man, woman, and child in the United States!

    Imagine the effect that would have on consumer demand. When people buy more, companies need to produce more, which stimulates economic growth. By contrast, if the FED just prints trillions of dollars and hands it over to the Wall Street banks, the banks get rich, corporate profits and the stock market return to pre-crash levels, but the country continues to struggle with poverty and unemployment. It is the perfect formula for expanding the gap between the 1% and the 99%.

    Democrats? Republicans? Who cares? None of this ever changes because the banks run this country, and nearly everybody who sits in the chairs in Washington, D.C. is a prostitute to them.

    --David (a disgruntled Ron Paul voter feeling almost as cynical as Tom today)

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  6. I disagree with your analogy. QE3 is not moving money from the government's right pocket to left pocket. It is moving (over two years) about $1 trillion worth of "toxic" mortgage-backed securities generated by the Wall Street derivative scams that crashed in global economy in 2008 from the balance sheets of the banksters to the FED. One thing you and I agree on is that these banks should have gone bankrupt in 2008. Barring that, they should now have to take their own medicine and eat their losses on the mortgage-backed securities instead of the FED absorbing them. Zuckerman is crazy if he thinks the banks are suddenly going to become patriotic and start making loans to small businesses in a risky economy when the alternative is to just sit back and rake in $40 billion a month risk free by selling off their nearly worthless "mortgage-backed" (laugh, laugh) derivatives to the FED. The root cause of our problems is not politicians or the FED. It is the Wall Street banks who control both of the above. The OWS people have figured this out. Most others have not.

    --David

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  7. You may disagree with Zuckerman but at least he is coming up with ideas. How many ideas is Obummmer coming up with? Banks should be made to go back to what banks do--make loans and nothing else. Get them out of the investment business and insurance business!

    You completely miss the analogy. Is not the Fed and the US Treasury pretty much the same? Who controls both? The Administration. My analogy is brilliant and you need to think again!

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  8. You wrote, "You may disagree with Zuckerman but at least he is coming up with ideas. How many ideas is Obummmer coming up with?"

    I don't know why you say this. The jobs bill that Obama proposed a year ago and which has stalled in Congress would do three of the five ideas Zuckerman suggested. That's why I said I was surprised by your comment that you -- as a conservative -- support all five of Zuckerman's ideas, since most of them are opposed by conservatives in Congress.

    "Is not the Fed and the US Treasury pretty much the same?"

    No. They have very different functions. The FED is actually comprised of a group of private banks. It is not controlled by the administration. What you should have noticed in the financial collapse (if not before) is that Wall Street called the shots over the FED as well as over both the Bush and Obama administrations and Congress, and they are still doing it. As I said, Zuckerman does not explain the reason why the banks are not providing credit to small business. They don't need to take that risk in order to make huge risk-free profits -- not so long as they can sell their mortgage-backed securities to the FED and borrow at nearly zero interest from the FED to finance their next big derivatives scam or whatever else they have in their pipeline these days. The thing you and I agree on is that this must end. The sooner the better.

    --David

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    Replies
    1. The jobs bill is totally negative and does not create more jobs!

      The Fed chairman is approved by the Congress-making it political. They are the same!

      Delete
  9. "The jobs bill is totally negative and does not create more jobs!"

    That is more what I would have expected you to say! (No competent economist would agree, however.)

    Anyway, whether you think it would create jobs or not, the jobs bill would establish 3 of the spending programs Zuckerman suggests, which is why I was surprised to hear that you agree with all 5 of his recommendations.

    The FED chairman is approved by Congress, but that doesn't make it a cabinet position. More to the point, even if it were, it would make little practical difference because the Wall Street banks would still be calling the shots. If the FED were acting to benefit society instead of the banks, they would not be buying up all these mortgage-back securities under QE3. They would be doing something to help resolve the mortgage mess or put money in the hands of consumers to stimulate demand.

    --David

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  10. A very interesting group of graphs here….

    http://oregoneconomicanalysis.wordpress.com/2012/09/24/checking-in-on-financial-crises-recoveries/

    -- David

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  11. Number don't lie but liars (pols) use numbers. As I have said many times before, these numbers are false and understated. Unfortunately, it looks like my number prediction might be a bit short.

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