Of course, but only if we reach critical mass. And even so, I doubt the oligarchy would give in without a struggle.Parodite wrote:Our votes, democracy is the only weapon we have. If we are legion, many...and in many countries, it is an unstoppable force. No oligarchic nut cannot be cracked.
Gloom, Doom, or Boom? Finance and Economics
- YMix
- Posts: 4631
- Joined: Mon Dec 12, 2011 4:53 am
- Location: Department of Congruity - Report any outliers here
Re: Gloom, Doom, or Boom? Finance and Economics
“There are a lot of killers. We’ve got a lot of killers. What, do you think our country’s so innocent? Take a look at what we’ve done, too.” - Donald J. Trump, President of the USA
The Kushner sh*t is greasy - Stevie B.
The Kushner sh*t is greasy - Stevie B.
Re: Gloom, Doom, or Boom? Finance and Economics
thats fine as a catchy bit of wordplay, i might even agree with it, however its got nothing todo with our current structure and society and the nature of finances and investment.YMix wrote:I was thinking along the same lines, but from the opposite angle. Society is not a charity for big business.noddy wrote:no conspiracy in any of that, you would have to be a charity to lend money to someone who pardons the debt and you would be be an even bigger charity to invest in someone who nationalizes those investments.
i dont tend to look to multinational big boys as religious institutions.
if you want foreigners to throw money at you then you better make them feel safe they will get that money back and some profit on top, culture or religion is irrelevant.
ultracrepidarian
- YMix
- Posts: 4631
- Joined: Mon Dec 12, 2011 4:53 am
- Location: Department of Congruity - Report any outliers here
Re: Gloom, Doom, or Boom? Finance and Economics
Honest investors are okay, depending on what each society wants. Parasitical TBTF a$$holes are not.
At most, society can give assurances that it won't rob investors. Whether they make their money back and a profit is their problem.if you want foreigners to throw money at you then you better make them feel safe they will get that money back and some profit on top, culture or religion is irrelevant.
“There are a lot of killers. We’ve got a lot of killers. What, do you think our country’s so innocent? Take a look at what we’ve done, too.” - Donald J. Trump, President of the USA
The Kushner sh*t is greasy - Stevie B.
The Kushner sh*t is greasy - Stevie B.
Re: Gloom, Doom, or Boom? Finance and Economics
i agree with that, i was responding to endo's wishes of debt pardoning and the effect this has upon outside investment.
the specific nightmare of the eu, its funding and its untouchables, its undemocractic stupid layered upon stupider is something else altogether.
the specific nightmare of the eu, its funding and its untouchables, its undemocractic stupid layered upon stupider is something else altogether.
ultracrepidarian
- Heracleum Persicum
- Posts: 11674
- Joined: Sat Dec 22, 2012 7:38 pm
Re: Gloom, Doom, or Boom? Finance and Economics
.
Project Prophecy .. pls watch
Folks , Swiss Frank style crazy thing looks ahead for U$ .. sudden collapse engineered by FED
Smells
and
Look here
Scary
.
Project Prophecy .. pls watch
Folks , Swiss Frank style crazy thing looks ahead for U$ .. sudden collapse engineered by FED
Smells
and
Look here
Scary
.
Re: Gloom, Doom, or Boom? Finance and Economics
highly recommended, follow up on the discussions about Greece, Eurozone etc.:
tm6REM-AFTg
tm6REM-AFTg
Deep down I'm very superficial
Re: Gloom, Doom, or Boom? Finance and Economics
Interesting thing is that Hans-Werner Sinn gives a pretty good analysis of the Euro crisis and why it was a bad idea to begin with, but still believes a United States of Europe is necessary. He claims: without a USE there will not be long term stability and peace in Europe. This is pure autistical paranoia.
Deep down I'm very superficial
Re: Gloom, Doom, or Boom? Finance and Economics
the madness of bigger bigger, more more, appears to be contagious.
im not sure if this person has heard of civil wars, its not like the indentity differences or pride go away just because some meathead official calls things by a new name
im not sure if this person has heard of civil wars, its not like the indentity differences or pride go away just because some meathead official calls things by a new name
ultracrepidarian
Re: Gloom, Doom, or Boom? Finance and Economics
what if ?
what if the whole bigger economy is better is actually a juvenile obsession with numbers that actually has zero bearing on reality.
what if "the usa" is a big economy because new york and los angeles are added together and that makes the numbers look impressive but all those poor states in the middle couldnt give a lavender about those numbers.
what if "the use" would have a huge economy as you add berlin,france and london together but in reality nothign changes for all the other states.
what if "the southern perfecticos' had an impressive sounding big number when you take italy and spains gdp but good ole greece and portugal are still greece and portugal.
what if its just a load of total wank to make some officials richer because they have a bigger tax base.
what if the whole bigger economy is better is actually a juvenile obsession with numbers that actually has zero bearing on reality.
what if "the usa" is a big economy because new york and los angeles are added together and that makes the numbers look impressive but all those poor states in the middle couldnt give a lavender about those numbers.
what if "the use" would have a huge economy as you add berlin,france and london together but in reality nothign changes for all the other states.
what if "the southern perfecticos' had an impressive sounding big number when you take italy and spains gdp but good ole greece and portugal are still greece and portugal.
what if its just a load of total wank to make some officials richer because they have a bigger tax base.
ultracrepidarian
Re: Gloom, Doom, or Boom? Finance and Economics
Amen bro. I don't believe in the existence of the European community, anymore than I believe in the existence of the American/Liberal/conservative/Black/White/gay/straight/etc. communities.noddy wrote:what if ?
what if the whole bigger economy is better is actually a juvenile obsession with numbers that actually has zero bearing on reality.
what if "the usa" is a big economy because new york and los angeles are added together and that makes the numbers look impressive but all those poor states in the middle couldnt give a lavender about those numbers.
what if "the use" would have a huge economy as you add berlin,france and london together but in reality nothign changes for all the other states.
what if "the southern perfecticos' had an impressive sounding big number when you take italy and spains gdp but good ole greece and portugal are still greece and portugal.
what if its just a load of total wanker to make some officials richer because they have a bigger tax base.
As for all the buttheads who claim to speak for those communities, they are suffering from a mental disease..... but making a damn fine living doing so!
People just don't live like that. Plus the member can't decide his own identity/group label, only the observer can.
What if we all called ourselves "Fred" or "human" and forgot the other labels?
What if you are an agent of the Bilderbergs or anglo-zionists or reptilians trying to f**k up the current system "we" have perfected?
Do you have any idea how much that hurt me when you shattered my ideal of you?
"All I care to know is that a man is a human being--that is enough for me; he can't be any worse. I can get right down and grovel with him."
- Mark Twain
http://www.twainquotes.com/Man.html
Last edited by Simple Minded on Wed Jan 21, 2015 1:33 pm, edited 1 time in total.
Re: Gloom, Doom, or Boom? Finance and Economics
Indeed. Moreover.. if national gvts fail in a Union.. it is all too easy to blaim the bigger sharks like Germany and get all hysterical. They better fail on their own.noddy wrote:the madness of bigger bigger, more more, appears to be contagious.
im not sure if this person has heard of civil wars, its not like the indentity differences or pride go away just because some meathead official calls things by a new name
Deep down I'm very superficial
Re: Gloom, Doom, or Boom? Finance and Economics
The European Central Bank will start printing money to "save" the South. Nothing has changed. The banks won: they can make more money and the South will go bankrupt with an even bigger debt in the future that then will be our debt in the North. Perfect strategy to kill Europe. Case closed.
The European Central Bank has announced a €60 billion ($69 billion) monthly government bond buying program—Quantitative Easing—but that won’t do much for the moribund continental economy.
Central banks can print money to purchase government bonds to push up prices and lower interest rates on those assets and competing debt, such as corporate bonds and bank loans. In the United States, the Federal Reserve also bought billions in federally-sponsored mortgage-backed securities, such as those issued by Fannie Mae.
The aim is to encourage more borrowing by businesses and homebuyers—stimulus spending financed by running the printing press.
The Fed enjoyed some success boosting U.S. growth, but here are five reasons why QE won’t work for the ECB.
1. Eurozone Is Not a Country
The European Union does not have a large budget and issues few euro-denominated bonds the ECB could purchase. Instead, the ECB will have to purchase individual country debt—it is as if the Fed had to purchase a basket of bonds issued by California, Iowa, and other states.
Markets for European bonds—both sovereign and corporate—and bank lending are highly fragmented along country lines. Consequently, it is unlikely that QE will have much effect on banks’ willingness to make new business loans in places buffeted by the financial crisis, like Spain and Greece.
2. EU Has No Fannie Mae
QE seems to work best when central banks inject capital directly into specific markets. The Fed purchased mortgage-backed securities that significantly lowered interest rates on mortgages across America. Housing prices recovered much of the value lost during the financial crisis, and new home construction rebounded.
The EU has no analog to Fannie Mae and Freddie Mac, and the ECB cannot readily purchase mortgage-backed securities to boost the European housing sector.
3. Fiscal Policy Is Pulling in the Opposite Direction
Europe’s largest economy, Germany, recently accomplished a balanced budget for the first time since 1969, and austerity programs intended to restore solvency have forced massive government spending cuts and tax increases in Spain, Greece, and other Mediterranean states.
Those spending cuts—though essential to sorely needed structural reforms—will undercut the effects of any increased bank lending ECB bond purchase may induce. With unemployment hovering at about 25 percent in Spain and Greece and 13 percent in Italy, banks will remain skeptical that lending to expand businesses will do much to create bigger markets for what they sell.
4. QE Does Little to Fix Euro-Imposed Dysfunctions
Although structural reforms could make Greece, Italy, and other high unemployment economies more attractive places to build factories and establish businesses in the long run, governments in Athens, Rome, and other capitals face voters who need jobs now. And the cost of labor—though perhaps gradually falling—in these countries will remain too high to attract investment for many years.
If Mediterranean countries still had their own currencies, those could let their currencies fall in value relative to those of northern European states. That would re-price labor to attract investment and jobs. But the single currency, the euro, deprives them of that lever.
5. Absence of Pan European Institutions
Though the Europeans have a single currency, they lack common education standards and language that gives the United States a more or less single labor market.
In the absence of currency devaluation to re-price Mediterranean labor, Greeks, Italians and Spaniards cannot migrate to Germany where unemployment is only 5 percent, with the same ease that Americans have migrated to South Dakota and Texas to participate in the oil boom.
In the end, the EU and ECB lacks what the Fed enjoys—the punch of a national government that ran large deficits to augment its efforts to pull the U.S. economy out of recession and national credit, housing, and labor markets that made monetary policies—like QE—reasonably effective.
Deep down I'm very superficial
- Endovelico
- Posts: 3038
- Joined: Mon Dec 12, 2011 3:00 pm
Re: Gloom, Doom, or Boom? Finance and Economics
Like most things in life, it depends on how and what for it will be done. For instance, if that money would allow for modernization of the productive apparatus and investment in state of the art technology, in Southern countries, it could very well do the trick...Parodite wrote:The European Central Bank will start printing money to "save" the South. Nothing has changed. The banks won: they can make more money and the South will go bankrupt with an even bigger debt in the future that then will be our debt in the North. Perfect strategy to kill Europe. Case closed.
- Heracleum Persicum
- Posts: 11674
- Joined: Sat Dec 22, 2012 7:38 pm
Re: Gloom, Doom, or Boom? Finance and Economics
Parodite wrote:The European Central Bank will start printing money to "save" the South. Nothing has changed. The banks won: they can make more money and the South will go bankrupt with an even bigger debt in the future that then will be our debt in the North. Perfect strategy to kill Europe. Case closed.
The European Central Bank has announced a €60 billion ($69 billion) monthly government bond buying program—Quantitative Easing—but that won’t do much for the moribund continental economy.
Central banks can print money to purchase government bonds to push up prices and lower interest rates on those assets and competing debt, such as corporate bonds and bank loans. In the United States, the Federal Reserve also bought billions in federally-sponsored mortgage-backed securities, such as those issued by Fannie Mae.
The aim is to encourage more borrowing by businesses and homebuyers—stimulus spending financed by running the printing press.
The Fed enjoyed some success boosting U.S. growth, but here are five reasons why QE won’t work for the ECB.
1. Eurozone Is Not a Country
The European Union does not have a large budget and issues few euro-denominated bonds the ECB could purchase. Instead, the ECB will have to purchase individual country debt—it is as if the Fed had to purchase a basket of bonds issued by California, Iowa, and other states.
Markets for European bonds—both sovereign and corporate—and bank lending are highly fragmented along country lines. Consequently, it is unlikely that QE will have much effect on banks’ willingness to make new business loans in places buffeted by the financial crisis, like Spain and Greece.
2. EU Has No Fannie Mae
QE seems to work best when central banks inject capital directly into specific markets. The Fed purchased mortgage-backed securities that significantly lowered interest rates on mortgages across America. Housing prices recovered much of the value lost during the financial crisis, and new home construction rebounded.
The EU has no analog to Fannie Mae and Freddie Mac, and the ECB cannot readily purchase mortgage-backed securities to boost the European housing sector.
3. Fiscal Policy Is Pulling in the Opposite Direction
Europe’s largest economy, Germany, recently accomplished a balanced budget for the first time since 1969, and austerity programs intended to restore solvency have forced massive government spending cuts and tax increases in Spain, Greece, and other Mediterranean states.
Those spending cuts—though essential to sorely needed structural reforms—will undercut the effects of any increased bank lending ECB bond purchase may induce. With unemployment hovering at about 25 percent in Spain and Greece and 13 percent in Italy, banks will remain skeptical that lending to expand businesses will do much to create bigger markets for what they sell.
4. QE Does Little to Fix Euro-Imposed Dysfunctions
Although structural reforms could make Greece, Italy, and other high unemployment economies more attractive places to build factories and establish businesses in the long run, governments in Athens, Rome, and other capitals face voters who need jobs now. And the cost of labor—though perhaps gradually falling—in these countries will remain too high to attract investment for many years.
If Mediterranean countries still had their own currencies, those could let their currencies fall in value relative to those of northern European states. That would re-price labor to attract investment and jobs. But the single currency, the euro, deprives them of that lever.
5. Absence of Pan European Institutions
Though the Europeans have a single currency, they lack common education standards and language that gives the United States a more or less single labor market.
In the absence of currency devaluation to re-price Mediterranean labor, Greeks, Italians and Spaniards cannot migrate to Germany where unemployment is only 5 percent, with the same ease that Americans have migrated to South Dakota and Texas to participate in the oil boom.
In the end, the EU and ECB lacks what the Fed enjoys—the punch of a national government that ran large deficits to augment its efforts to pull the U.S. economy out of recession and national credit, housing, and labor markets that made monetary policies—like QE—reasonably effective.
This only to save European banks .. otherwise European banks could go broke, pretty much all of them
European economy, DRAGHI said many times on the record, has "structural" problem
Europeans want to keep the social welfare state but not work for it .. Either the Dutch must be all Einsteins and send their unemployed to Ibiza on state cost, or the others must be real idi*ts
Parodite, Europeans can not have the cake and eat it too
If printing money would make Europeans rich again, than Bangladesh can start printing too
ECB knows bad times coming, deflation, Japan style, and wants to soften the landing and protect the banks, that is all
Don't hold your breath .. There will be no trickle down to you, Parodite
.
Re: Gloom, Doom, or Boom? Finance and Economics
If the past gives any indication of the future... that is a big wishful thinking. More debt will not do the trick.. unless the South performs some miracle trick of changing their policies into the opposite of what they are doing now. They won't. And as has been repeated over and over.. the Euro only makes it much harder aqa impossible for the South because they can't devaluate which would be the quickest and easiest resolve with the least risk for both the South and the North.Endovelico wrote:Like most things in life, it depends on how and what for it will be done. For instance, if that money would allow for modernization of the productive apparatus and investment in state of the art technology, in Southern countries, it could very well do the trick...Parodite wrote:The European Central Bank will start printing money to "save" the South. Nothing has changed. The banks won: they can make more money and the South will go bankrupt with an even bigger debt in the future that then will be our debt in the North. Perfect strategy to kill Europe. Case closed.
Deep down I'm very superficial
- Endovelico
- Posts: 3038
- Joined: Mon Dec 12, 2011 3:00 pm
Re: Gloom, Doom, or Boom? Finance and Economics
Devaluation is very much an illusion. When it happens to solve a conjunctural unbalance it may work, but it will never solve a structural unbalance. Countries which have done it to solve structural deficits were faced with repeated devaluation, high inflation, lower real salaries and lowered purchasing power. Any European country can redress its economy by adequate investment, so there is absolutely no need to slide into a third world situation of garbage currency and high inflation, which is what would happen to countries leaving the euro. It's one of those dumb ideas that occur to people ignorant of macroeconomics because it looks like a quick fix. I assure all of you that it would be the quickest road to disaster. If any of the southern European countries decides to go that way, you will soon see what I mean...Parodite wrote:If the past gives any indication of the future... that is a big wishful thinking. More debt will not do the trick.. unless the South performs some miracle trick of changing their policies into the opposite of what they are doing now. They won't. And as has been repeated over and over.. the Euro only makes it much harder aqa impossible for the South because they can't devaluate which would be the quickest and easiest resolve with the least risk for both the South and the North.Endovelico wrote:Like most things in life, it depends on how and what for it will be done. For instance, if that money would allow for modernization of the productive apparatus and investment in state of the art technology, in Southern countries, it could very well do the trick...Parodite wrote:The European Central Bank will start printing money to "save" the South. Nothing has changed. The banks won: they can make more money and the South will go bankrupt with an even bigger debt in the future that then will be our debt in the North. Perfect strategy to kill Europe. Case closed.
Re: Gloom, Doom, or Boom? Finance and Economics
Iceland proves you wrong, but why would you care.. And within the Eurozone, if you want to learn some lessons from others, which I doubt, study Ireland.Endovelico wrote:Devaluation is very much an illusion. When it happens to solve a conjunctural unbalance it may work, but it will never solve a structural unbalance. Countries which have done it to solve structural deficits were faced with repeated devaluation, high inflation, lower real salaries and lowered purchasing power. Any European country can redress its economy by adequate investment, so there is absolutely no need to slide into a third world situation of garbage currency and high inflation, which is what would happen to countries leaving the euro. It's one of those dumb ideas that occur to people ignorant of macroeconomics because it looks like a quick fix. I assure all of you that it would be the quickest road to disaster. If any of the southern European countries decides to go that way, you will soon see what I mean...Parodite wrote:If the past gives any indication of the future... that is a big wishful thinking. More debt will not do the trick.. unless the South performs some miracle trick of changing their policies into the opposite of what they are doing now. They won't. And as has been repeated over and over.. the Euro only makes it much harder aqa impossible for the South because they can't devaluate which would be the quickest and easiest resolve with the least risk for both the South and the North.
Bottomline is, if the South fails and this 1.1 trillion (!) Euro bailout goes down the drain as well... Europe is toast and the North will gladly dump the South in the Mediterreaneum. Expect enormous social unrest. Greece is toast already, they can never pay anything back and are now voting for a socialist populist who just blabs words and hastens Greece's demise.
Deep down I'm very superficial
- Endovelico
- Posts: 3038
- Joined: Mon Dec 12, 2011 3:00 pm
Re: Gloom, Doom, or Boom? Finance and Economics
Iceland doesn't disprove my point, because Iceland was not in the euro zone. And Ireland had a trade surplus, which meant that staying in the euro wasn't even put into question. All it needed was cleaning up the banking mess. Portugal and Greece need productive investment, and that requires funds. The present ECB decision may - and I hope it will - allow for sufficient funds to be liberated for investment. And that's my point, in case you missed it.Parodite wrote:Iceland proves you wrong, but why would you care.. And within the Eurozone, if you want to learn some lessons from others, which I doubt, study Ireland.Endovelico wrote:Devaluation is very much an illusion. When it happens to solve a conjunctural unbalance it may work, but it will never solve a structural unbalance. Countries which have done it to solve structural deficits were faced with repeated devaluation, high inflation, lower real salaries and lowered purchasing power. Any European country can redress its economy by adequate investment, so there is absolutely no need to slide into a third world situation of garbage currency and high inflation, which is what would happen to countries leaving the euro. It's one of those dumb ideas that occur to people ignorant of macroeconomics because it looks like a quick fix. I assure all of you that it would be the quickest road to disaster. If any of the southern European countries decides to go that way, you will soon see what I mean...Parodite wrote:If the past gives any indication of the future... that is a big wishful thinking. More debt will not do the trick.. unless the South performs some miracle trick of changing their policies into the opposite of what they are doing now. They won't. And as has been repeated over and over.. the Euro only makes it much harder aqa impossible for the South because they can't devaluate which would be the quickest and easiest resolve with the least risk for both the South and the North.
Bottomline is, if the South fails and this 1.1 trillion (!) Euro bailout goes down the drain as well... Europe is toast and the North will gladly dump the South in the Mediterreaneum. Expect enormous social unrest. Greece is toast already, they can never pay anything back and are now voting for a socialist populist who just blabs words and hastens Greece's demise.
Re: Gloom, Doom, or Boom? Finance and Economics
the industrial revolution was started in england in the 1800's endo.
the fact you blame the germans for portugal not investing in it FOR 200+ genuflecting years is beyond insane, its just genuflecting laughable.
the fact you blame the germans for portugal not investing in it FOR 200+ genuflecting years is beyond insane, its just genuflecting laughable.
ultracrepidarian
- Endovelico
- Posts: 3038
- Joined: Mon Dec 12, 2011 3:00 pm
Re: Gloom, Doom, or Boom? Finance and Economics
I don't blame anyone but ourselves. But that's besides the point. The point is that now one needs a lot more money to invest, in order to catch up. If the ECB makes it available, that's fine with me.noddy wrote:the industrial revolution was started in england in the 1800's endo.
the fact you blame the germans for portugal not investing in it FOR 200+ genuflecting years is beyond insane, its just genuflecting laughable.
Re: Gloom, Doom, or Boom? Finance and Economics
Iceland proves that countries in an extreme financial crisis... read tohotally broke... read absolutely bankrupt... can recover very fast as a souvereign nation with its own currency. Devaluating their own currency was an important tool in the recovery (see Stiglitz and others). Added medicine in their mix: 1. they allowed banks to go bankrupt (no bailouts), 2. they filed criminal charges against bankers and politicians responsible for the financial crisis and sent them to jail or under house arrest, 3. they refused to pay back losses of those banks (not bailing them out) that were not the result of their own wrongdoing, but of those banks themselves and their (mostly British and Dutch) careless/naive shareholders.Endovelico wrote:Iceland doesn't disprove my point, because Iceland was not in the euro zone.Parodite wrote:Bottomline is, if the South fails and this 1.1 trillion (!) Euro bailout goes down the drain as well... Europe is toast and the North will gladly dump the South in the Mediterreaneum. Expect enormous social unrest. Greece is toast already, they can never pay anything back and are now voting for a socialist populist who just blabs words and hastens Greece's demise.
Dun think so, http://www.tradingeconomics.com/iceland ... e-of-trade:And Ireland had a trade surplus,
So before the crisis hit them in 2008 they were in fact in a trade deficit.
They would not have been able to clean up that mess had they been in the Eurozone.which meant that staying in the euro wasn't even put into question. All it needed was cleaning up the banking mess.
Greece is like a mismanaged business unable to make a profit drowning in its own deficits. As with mismanaged banks.. they must go bankrupt and reboot with a clean slate instead of being put on life support.Portugal and Greece need productive investment, and that requires funds. The present ECB decision may - and I hope it will - allow for sufficient funds to be liberated for investment. And that's my point, in case you missed it.
Allowing for bankrupties in the market is what cleans out the mess and what in the end creates wealth because the healthy performing players survive. To subsidize failures is economic euthanasia. Yearly around 8000 businesses go bankrupt in the Netherlands which is a normal number... where you think we would be if they were put on life support? It would kill the healthy business.. and we would all eat nothing but potatoes again.
Deep down I'm very superficial
Re: Gloom, Doom, or Boom? Finance and Economics
exactly, unlike the debt pardon the banks and officials responsible get punished - as sparky once said "put the bank back into bankruptcy"
ultracrepidarian
Re: Gloom, Doom, or Boom? Finance and Economics
Amen. A self-correcting process that only exists in free markets. Once the pols get involved, corruption results.Parodite wrote:
Allowing for bankrupties in the market is what cleans out the mess and what in the end creates wealth because the healthy performing players survive. To subsidize failures is economic euthanasia. Yearly around 8000 businesses go bankrupt in the Netherlands which is a normal number... where you think we would be if they were put on life support? It would kill the healthy business.. and we would all eat nothing but potatoes again.
- Endovelico
- Posts: 3038
- Joined: Mon Dec 12, 2011 3:00 pm
Re: Gloom, Doom, or Boom? Finance and Economics
Parodite,
You mixed up Ireland and Iceland several times in your post. Will you want to go back to it and correct your statements?...
You mixed up Ireland and Iceland several times in your post. Will you want to go back to it and correct your statements?...
- Endovelico
- Posts: 3038
- Joined: Mon Dec 12, 2011 3:00 pm
Re: Gloom, Doom, or Boom? Finance and Economics
When a firm produces quality goods which find a demand in the market, but are financially bankrupt, you may close them up or you may clear the mess by giving them money to pay their excessive debt. If you close them up, you lose everything, if you give them money to clear the mess, you only spend some funds. The question is: if you give them the money will they go back to their old mistakes, or not? You seem to see a bankruptcy as a deserved punishment for financial sins, but that's mixing up economics with morals... Very Calvinistic...Parodite wrote:Allowing for bankrupties in the market is what cleans out the mess and what in the end creates wealth because the healthy performing players survive. To subsidize failures is economic euthanasia. Yearly around 8000 businesses go bankrupt in the Netherlands which is a normal number... where you think we would be if they were put on life support? It would kill the healthy business.. and we would all eat nothing but potatoes again.