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09/16/2008 09:31:50 AM · #1 |
Now that Lehman Brothers has filed for bankruptcy, and after seeing Merrill Lynch & Co. and Bear Stearns go the same route, what is going on here exactly? Are we seeing a start to a very sever depression like in 1929 and the following years? Are these the first signs to a major breakdown of the world's financial markets? Should we be scared and start taking precautions to avert this, personally and by our governments?
Or are these major players just getting what they deserve? By lending money to people who they knew could not pay back the money in the event of a minor financial squeeze, be it a family death or a slowdown in the housing market. Are these lenders just blowing hot air about their financial woes and are they posturing themselves for hefty government handouts and subsidies that our children's children will be paying for?
80 years after the great depression
Is it happening again? Did they see it coming in '29?
Thoughts?
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09/16/2008 09:41:04 AM · #2 |
| All three companies survived the Great Depression, WWI, WWII, the 70's Oil Crisis, the 1987 crash, Y2K, the Internet Bubble and 9/11, but succumbed to the current "fundamentally strong" economy. Not good. |
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09/16/2008 09:41:44 AM · #3 |
This is very serious. A lot of major banks acted irresponsibly, completely underestimating the risk of Mortgage-Backed Securities based on mortgages that were loaned out indiscriminately. House prices have further to fall. Now, in the U.S., you must compound that with high gas prices and people taking on too much credit card debt.
We're not done crashing yet. The solution? I think we have to let it finish crashing. I'm not for government bailouts.
But this is small potatoes next to global warming. |
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09/16/2008 10:10:08 AM · #4 |
I'm jittery.
My trust of government and big biz...and their collective lack of intelligence has been dealt a nearly killer blow.
I'm not for goverment bailouts either except for the case of Fannie and Freddie.
What scares me more is that taxes haven't been raised...we're in a war that is being financed by China...our debt is gigantic...foreign countries our buying up large chunks of real estate (Chrysler Building to Abu Dhabi Investment Firm)...almost no one trusts or respects us anymore...
The sky could actually be falling...or is that global warming?
Message edited by author 2008-09-16 10:34:26. |
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09/16/2008 10:48:19 AM · #5 |
Heh....
The CEO here has been talking about shutting the company down unless we can finish a report by next week. I told him I didn't like his scare tactics. He told me he's put is house in hock to finance the company. That shut me up.
:-O
So I might be on the streets pretty soon. I finished the paperwork for a second mortgage of my own yesterday. Hopefully the bank won't back out.
We should all just move to a tropical island together and live off the land, that would be fun! :-)
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09/16/2008 10:56:35 AM · #6 |
Heard an interesting statistic this morning: here in NYC, 4.5% of the jobs are in the financial industry, but they account for 25% of the salaries earned. Putting so many of those people out of work will definitely effect the local economy.
My impression is that this crisis is mainly a result of deregulation. Do you feel that is too simplistic a view? |
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09/16/2008 10:57:04 AM · #7 |
Originally posted by Strikeslip:
We should all just move to a tropical island together and live off the land, that would be fun! :-) |
Sounds a bit like "Lord of the Flies" to me. |
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09/16/2008 10:58:13 AM · #8 |
Originally posted by Spazmo99:
Originally posted by Strikeslip:
We should all just move to a tropical island together and live off the land, that would be fun! :-) |
Sounds a bit like "Lord of the Flies" to me. |
No, that was  Jacko |
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09/16/2008 11:00:17 AM · #9 |
Originally posted by citymars:
Heard an interesting statistic this morning: here in NYC, 4.5% of the jobs are in the financial industry, but they account for 25% of the salaries earned. Putting so many of those people out of work will definitely effect the local economy.
My impression is that this crisis is mainly a result of deregulation. Do you feel that is too simplistic a view? |
deregulation is a big culprit. "mainly" is up for debate.
That stuff Steve said about borrowing from China is another Big Factor I forgot to mention. A lot of the blame for that goes to Bush, who gave big corporate tax breaks and threw away a lot of money into the Iraq War. |
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09/16/2008 11:00:54 AM · #10 |
Originally posted by citymars:
My impression is that this crisis is mainly a result of deregulation. Do you feel that is too simplistic a view? |
We need to get campaign finance reform badly. Money in politics is tantamount to bribery.
Nobody has ever given me money without wanting something in return (except for my mom, perhaps).
Lobbyists need to go, as well...and the sooner the better.
Message edited by author 2008-09-16 12:48:04. |
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09/16/2008 11:01:44 AM · #11 |
Originally posted by scalvert:
the current "fundamentally strong" economy. |
This was a buzz phrase just before Black Friday, 1928.
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09/16/2008 11:05:10 AM · #12 |
Originally posted by MelonMusketeer:
Originally posted by scalvert:
the current "fundamentally strong" economy. |
This was a buzz phrase just before Black Friday, 1928. |
There's a cheerful thought. |
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09/16/2008 11:21:05 AM · #13 |
Originally posted by pawdrix:
What scares me more is that taxes haven't been raised...we're in a war that is being financed by China...our debt is gigantic...foreign countries our buying up large chunks of real estate (Chrysler Building to Abu Dhabi Investment Firm)...almost no one trusts or respects us anymore...
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Raising taxes will not help the economy, as people will have even less to spend. Huge problems are being created for the financial future of this country, but I am not fond of the idea of working the rest of my life and giving my salary to the government. (I don't have an answer, but I hope one can be found other than having an entire generation forgo discretionary spending.)
"4.5% of the jobs are in the financial industry, but they account for 25% of the salaries earned." If this is true, it seems a large part of the problem is the amount of the salaries. I have heard that the difference in salaries between those at the top and the bottom of corporations in Japan is nowhere near as wide as it is here. Narrowing the gap would solve a lot of problems. |
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09/16/2008 11:34:31 AM · #14 |
Originally posted by chaimelle:
Raising taxes will not help the economy, as people will have even less to spend. |
We should have raised taxes before we went to war. Parenthetically, I would add that we should never have gone to war. History and more exposee books will better tell that tale in a manner of weeks, months and years BUT who's paying attention to that unpatriotic babble?
Again, this war is on loan from China.
Has a nasty ring...doesn't it? |
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09/16/2008 11:39:22 AM · #15 |
Originally posted by Strikeslip:
We should all just move to a tropical island together and live off the land, that would be fun! :-) |
LOL .... Survivor, DPC Style! Love it, when do we leave?! |
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09/16/2008 11:42:07 AM · #16 |
Originally posted by pawdrix:
Originally posted by chaimelle:
Raising taxes will not help the economy, as people will have even less to spend. |
We should have raised taxes before we went to war. Parenthetically, I would add that we should never have gone to war. History and more exposee books will better tell that tale in a manner of weeks, months and years BUT who's paying attention to that unpatriotic babble?
Again, this war is on loan from China.
Has a nasty ring...doesn't it? |
How much of your earnings would you like to send in? What are you willing to do without in order to help solve the problem? |
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09/16/2008 11:52:56 AM · #17 |
Originally posted by chaimelle:
How much of your earnings would you like to send in? What are you willing to do without in order to help solve the problem? |
Whatever it takes, I will pay. That's the way it works. I'm not happy about being in Iraq and I think it was a tremendous waste of time, money and energy and viewed it as more of a diversion. Perhaps your children will pay for it...well, some American's gonna pay at some point...right??
Correct me if I'm wrong here... we have Never been at war and NOT raised taxes since now.
Message edited by author 2008-09-16 11:55:43. |
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09/16/2008 12:18:42 PM · #18 |
If you earn $200,000 a year, would you be willing to live on $100,000? $75,000? You would still have more discretionary income than most, but unless you love your career so much you would do it for free, you are laboring long and hard for the government. How about yearly earnings of $50,000. Would you happily give up $15,000? $10,000? $20,000?
It seems that the more tax dollars that flow into Washington the more they want/spend. There needs to be fiscal responsibility along with any tax increase. |
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09/16/2008 12:30:25 PM · #19 |
Originally posted by chaimelle:
If you earn $200,000 a year, would you be willing to live on $100,000? $75,000? You would still have more discretionary income than most, but unless you love your career so much you would do it for free, you are laboring long and hard for the government. How about yearly earnings of $50,000. Would you happily give up $15,000? $10,000? $20,000?
It seems that the more tax dollars that flow into Washington the more they want/spend. There needs to be fiscal responsibility along with any tax increase. |
It would seem that those fellow Americans that voted for the current administration have cost me quite a few bucks, huh?
Solution: Anyone that voted for Bush or those who were pro-war...or think that it was a good idea should flip the bill AND not me. Big savings for Stevie!
I nearly smashed my television the smithereens during the lead-up to Iraq and was infuriated that Congress and the media laid down the whole way. They should pay too...out of pocket. A-holes!
And to take it one step further those who voted for the war and believe it was the right thing to do should be over there conducting business and those who voted against it should be given a pass. That'll never fly though...will it?
For the record, I can already account for $16-18k in lost income due to the economy and bad politics this year, so why not...I'll pay at some point, one way or the next. Or in other words, I have been paying your quoted amounts. Is that fair?
If you haven't noticed...YOU are paying at the pump and in higher food prices (beer for me)...and so on and so on. I'll pay....We'll pay. Trust me.
Message edited by author 2008-09-16 12:49:31. |
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09/16/2008 12:35:27 PM · #20 |
Originally posted by pawdrix:
Originally posted by chaimelle:
If you earn $200,000 a year, would you be willing to live on $100,000? $75,000? You would still have more discretionary income than most, but unless you love your career so much you would do it for free, you are laboring long and hard for the government. How about yearly earnings of $50,000. Would you happily give up $15,000? $10,000? $20,000?
It seems that the more tax dollars that flow into Washington the more they want/spend. There needs to be fiscal responsibility along with any tax increase. |
It would seem that those fellow Americans that voted for the current administration have cost me quite a few bucks, huh?
Solution: Anyone that voted for Bush or those who were pro-war...or think that it was a good idea should flip the bill AND not me. Big savings for Stevie!
I nearly smashed my television the smithereens during the lead-up to Iraq and was infuriated that Congress and the media laid down the whole way. They should pay too...out of pocket. A-holes!
And to take it one step further those who voted for the war and believe it was the right thing to do should be over there conducting business and those who voted against it should be given a pass. That'll never fly though...will it? |
Amen, everything that Congress passes, wars or any other spending, should generate an immediate Tax Bill for the citizens. Then we can all know what we're paying for what they're spending. |
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09/16/2008 12:48:45 PM · #21 |
Someone needs to put the National Credit Card through the shredder and go back to pay-as-you-go.
My kids (ages 5 and 7) understand the difference between needs and wants and can also tell you why credit cards are a bad thing only to be used in emergencies. Maybe I should send them to D.C. to explain it in terms Congress can understand and give everyone a big time out for being so irresponsible.
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09/16/2008 12:53:33 PM · #22 |
Originally posted by Spazmo99:
Someone needs to put the National Credit Card through the shredder and go back to pay-as-you-go.
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Wait til the interest builds up. We're so screwed.
How much more can we withstand? Another few natural or financial dissasters...another 9/11?
I'm feeling queazy...
Message edited by author 2008-09-16 12:53:58. |
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09/16/2008 12:57:45 PM · #23 |
Originally posted by Spazmo99:
Someone needs to put the National Credit Card through the shredder and go back to pay-as-you-go.
My kids (ages 5 and 7) understand the difference between needs and wants and can also tell you why credit cards are a bad thing only to be used in emergencies. Maybe I should send them to D.C. to explain it in terms Congress can understand and give everyone a big time out for being so irresponsible. |
Great idea!
As for actually creating a balanced budget, I can see some difficulties. What I think is a fair tax rate and appropriate spending would be deemed too high or too low by others, and I'm sure many of my idea on actual need vs. want would conflict with most of Washington's ideas.
Edit to add: I do realize that even if we had balanced budgets starting in 2009, we are still screwed!
Message edited by author 2008-09-16 12:59:42. |
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09/16/2008 12:59:49 PM · #24 |
Originally posted by pawdrix:
Originally posted by Spazmo99:
Someone needs to put the National Credit Card through the shredder and go back to pay-as-you-go.
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Wait til the interest builds up. We're so screwed.
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Nah, we'll be OK. It's our kids, grandkids and great-grandkids that have been screwed. Their future has been mortgaged so that we can keep driving SUV's and blowing the hell out of far-away places so our leader can settle Daddy's score, making his cronies wealthy in the process. |
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09/16/2008 01:01:20 PM · #25 |
I don't get it. With the US economy looking the way it is at the moment, how on earth can the levels of military spending in Iraq and Afghanistan be justified?
Is there some hidden economic benefit in continuing to pump money into these countries? Okay, I'd understand if it was keeping the oil prices down, but that just not happening at all. Or does war benefit the US economy in other ways like arms manufacturers etc.?
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