People point to the “unregulated” market of Wall Street, but nothing could be further from the truth. Wall Street is regulated to the bone. The whole economy is. Here’s just a small chunk of regulations that are huge contributors to heavy risk-taking:

- The Fed insures $100,000 (or is it $250K now?) of deposits in banks, meaning investors use multiple banks and use less scrutiny in choosing banks.
- Fannie and Freddy’s losses were backed by tax dollars, causing them to make riskier purchases of mortgages.
- The CRA forced banks to lend to risky borrowers, by law.
- Capital gains tax cut in 1997 for homes ONLY meant market was distorted toward home purchases. If you’re gonna cut taxes, cut all of em.
- Fed Reserve injecting money into economy artificially through interest rate tinkering.
- Fed bailing out insolvent banks and institutions, creating moral hazard for the largest and most influential.

Nobody cares about these, though. The standard answer, one that everyone here advocates, is to have government intervene and impose more restrictions. That’s what will happen, and it will cause the same problems.

These are dead giveaways of a fascist:
Democratic government bad.
Corporations have all the rights to do as they please.
People subservient to corporation.

mojorider:
Warren Buffet is nothing more than an apologist for one of his own. He’s saying that the public is as much to blame for these toxic mortgages. That’s bullshit cuz people got these houses because the banks that came up with these ARMs told people that “Hey good news!! You’re Qualified!!”…. and folks just thought that since they “qualified”, they must be alright. Banks are trustworthy right? It was Wall St. that invented this shit. Wall St. is responsible.

And what the fuck is this shit about “bad behavior”? Wall St. just behaved badly? WTF is that?! As far as the laissez faire proponents go, these Wall St. types did exactly like they were supposed to. They were maximizing profits and being as greedy as possible. As Gordon Gekko quoting Friedman said, “greed is good!” It’s not about behavior. It’s about regulating this derivatives market…… actually outlawing this shit and bring back the Glass-Steagal Act & whatever controls we had from the pre-Reagan days. Let our laws & our democracy control the greed. cuz if we allow the banksters to control themselves, greed will win every time.

As if the 100+ TRILLION dollar derivatives market is not already too big, Buffet still wants a “big capital market” after proposing a undisclosed solution for these toxic assets. He wants to take care of it himself ( not with government intervention)…….. which is a huge conflict of interest……. so he can keep doing whatever the hell he’s been doing to get his billions. He’s helping himself out with nothing for the rest of us. He’s bullshit.

Many good articles here with the solution to this economic crisis. Here’s one of ‘em:

[b]Greed: The Fundamental Flaw of Free Market Fundamentalism[/b]
http://www.newdeal20.org/?p=5716

Ugh, that again. I think I’ll just leave you guys to your opinions, because it seems people here are still unwilling to drop that issue. Feel free to email me stuntpeople at yahoo and I’d be happy to debate anybody privately until the end of time. Doing it here is frustrating.”

^Above…lol!

I am not going to put it nicely. Jacobus is a property/ states rights anarcho capitalist baffoon. On one end of the spectrum you have the anarcho socialists. On the other end you have these types of baffoons. Both groups are ‘absolute’ nuts in many ways except that with anarcho socialists, their hearts are at least in the right place as they actually want to make people’s lives better and they aren’t greedy, apathetic morons.

There are a lot of things that effect business decisions that have nothing to do with business. I personally know of a case of an older relative of mine who was a very highly skilled bookkeeper in a smaller town where nobody else had that level of skill. My relative was even willing to do the work at home so that it wouldn’t be quite so obvious that the company had hired a black man to do the accounting. But in the end, it didn’t work out, even though the company would have saved considerable money by using him. The owner just didn’t want to take the risk that people in town might find out and think that he was a “nigger lover.” Most of the people he actually sold product to were far away and would never have even known. The decision was made based on social pressure, not market pressures. This was back in the mid 1950s.

That is why these theories about building the better mousetrap, and the highest skills set can demand the highest pay, doesn’t always work. There are a lot more things to consider, and most of them are not found in economics books.

I think it’s pointless to continue the debate. EJ never really addressed my concerns about how the unregulated market creates social consequences and does nothing to remedy it. He basically admitted he didn’t know if an unregulated market could solve societal ills…but then goes on to say that we shouldn’t control greed, which gets to the root of what causes these social consequences to begin with! And that’s really the crux of the problem that King and I addressed, I think: it’s a question of how much intervention there needs to be. And that intervention has to come from some form of government.

But, since we’re piling on… I’ll do it politely.

If EJ wants to subscribe to anarchist philosophies, Ayn Rand stuff, etc…fine. But I just don’t see how it could ever work with the way human history has evolved. If it is the best system ever, wouldn’t the world have gravitated towards that model? Somewhere along the line, societies saw that there needed to be some intervention on the market. That’s why I brought up the point about child labor laws, the rise of unions to deal with management. You know, why do we have occupational safety standards at the workplace? Why do we have laws against price fixing and collusion?

Maybe some of those anarchist or libertarian philosophies could work on a micro level IF the conditions were right. And that would mean a paradigmn shift in the global economy (ie, some new world economic order as the result of global and environmental catastrophes, and in human and spiritual consciousness). But for now, humans can’t control greed and self interest. Just look at the health care industry right now. Look at executive compensation.

Warren Buffet had stated this recently in an interview:

“Exactly a year ago when I was at this conference, I had a proposal for the so‑called “toxic assets.” I called three people in the financial world who were going to write Secretary Paulson about it. I wrote them on October 6th. I called three people to help out on this, and it would have required a lot of effort on their part and some commitment of money and time and energy. I asked all three of them if this went forward to do it absolutely pro‑bono. I asked them not to make one dime out of it. And they all said yes to me. So, they are good people. Many are motivated by greed. None of us are perfect, you know? I always say that, “Every saint has a past, every sinner has a future.” We have got some sinners back there, but they are not all bad. They went along with a bubble that they helped create – but the whole American public did. You still have to have the right rewards and penalties for behavior. That’s how you get decent behavior. So, I don’t look at Wall Street as “evil.” I look at Wall Street as given to huge excess sometimes. I don’t want to get rid of it. We need something to allocate capital and distribute securities and all of that throughout the system. We have got a big capitalist system and we have to have a big capital market – but there is plenty of room for improvement.

“What you have to change in Wall Street is you have to make sure that in addition to carrots, there are sticks. And it can’t be a one‑way street where they are making ungodly amounts of money when things are good and then they move on to someplace else for a while when things are bad. You have to create a downside. I hope there are some practices put into place – and I’ll have a few thoughts on them myself – but Congress undoubtedly will have a few thoughts too. You have to put in something where there is downside to people who really mess up large institutions and we need some new help in that. Too many people have walked away from the troubles they have created for society, not just for their own institution, and they have walked away rich. They may not be as rich as they were before, but they have walked away better than they should have. There have to be incentives –not only to get rich, but to behave well.”

“There is a huge transfer of wealth to the Wall streeters who created these unregulated derivatives traded in what’s basically a “wild west scenario” with no government controls other than a “socialism for corporations” bailout from our hard earned money.”

Wall Street is already heavily regulated already through the SEC. Plan on seeing even more regulation that will screw the economy even further.

“Blame the Ivy League grads who invented derivatives that pooled a bunch of toxic AR mortgages & called them “AAA” and traded these securities as such.”

The ratings agency that gave out the “AAA” ratings was a government-sponsored monopoly, which restricted competition in the ratings industry. The ratings system was bust because it was government sanctioned.

“There has to be low cost schooling, high paying blue collar jobs, child care for single parents & many things that Obama promised”

Those things are in place already and are being expanded to include housing subsidies, wage fixing (min wage went up 70 cents to $7.55), and various other social programs that you think will work, but when they don’t you simply demand more.

“Today, we have 4 banks that control much of the financial industry. They need to be broken up.”

I agree. The Federal Reserve is to blame for the monopolizing of the dollar and bailing out its corporate buddies, which allows them to grow to the size they are now. Government at work.

All your complaints about capitalism are actually complaints against government.

It’s happening now. There is a huge transfer of wealth to the Wall streeters who created these unregulated derivatives traded in what’s basically a “wild west scenario” with no government controls other than a “socialism for corporations” bailout from our hard earned money. The banksters are getting rich while the rest are getting poorer with a rising unemployment rate and a declining median income over the last decade. We’re getting fucked over.

Eric J. wrote:”banks responding to government incentives that REQUIRE predatory lending, the Fed printing the dollar into oblivion, mass unemployment, and a huge welfare state that only breeds hostility and increasing poverty. People should look at the banking crisis of 1920 a little more often. The government didn’t stick its nose in at all, and the US recovered in roughly 1 year.”

How do you figure government incentives required predatory lending? That’s bullshit blaming the government. Blame the Ivy League grads who invented derivatives that pooled a bunch of toxic AR mortgages & called them “AAA” and traded these securities as such. It’s a scam. So its no “experiment” cuz its already done & its already fucked us over pretty good and you propose more of that. Fuck that.

And maybe you should look a little further in the 1930s & what happened after that. With Roosevelt’s New Deal and the social programs and strong unions in place, the foundations of a strong economy was in place and with it: the economy grew, the middle class came into prominence, the civil rights movement gave minorities better opportunities. It was the longest economic expansion in U.S. history. It was cuz money went to the people, not to some souless corporation that only seeks to replicate itself and create more low-paying jobs in the 3rd world & keeping the status quo of poverty in place. No sirree…. if money flows to the people, the economy will do well.

70% of U.S. GDP is consumer spending and there has to be programs that prop up the middle class & poor for the real economy to grow. There has to be low cost schooling, high paying blue collar jobs, child care for single parents & many things that Obama promised (yet to deliver…”HEY OBAMA.. IM WAITING!!!). If those social programs are not in place, we will not recover from this financial shitstorm.

Also, we need to go back to the turn of the century where the government broke up trusts. Today, we have 4 banks that control much of the financial industry. They need to be broken up. They have too much power.

This argument for “Kings” is nothing more than support for overturning the U.S. Constitution, getting rid of the Bill of Rights, eliminating democracy & installing a fascist dictatorship which allows corporations to do as they please. That is shit.

Ugh, that again. I think I’ll just leave you guys to your opinions, because it seems people here are still unwilling to drop that issue. Feel free to email me stuntpeople at yahoo and I’d be happy to debate anybody privately until the end of time. Doing it here is frustrating.

Yeah, you’re right. It’s become one of those late night college dorm debates where it’s pointless. And that’s the problem as you put it, this is an “ideological” thing.

As I’ve posted, the problem is that ideology is great and sounds fantastic. But it’s rather highly idealistic. Once you apply it to the real world, it falls apart. No one ideology has all the answers. It might have some, but it can’t account for everything.

EJ,

we’ll just agree to disagree. We see the world differently based on our personal experiences and colored thru our own upbringings. I just don’t think that greed, maximizing self interest, or whatever you want to call it, is as productive as you seem to think in an unregulated market. We’ll never know, of course, but I don’t trust human beings, especially powerful ones, to always do the right thing.