_w_ Posted June 16, 2011 Share Posted June 16, 2011 http://www.businessinsider.com/the-truth-about-the-economy-in-two-minutes-2011-6 Quote Link to comment Share on other sites More sharing options...
R K Posted June 16, 2011 Share Posted June 16, 2011 The trouble with capitalism is that eventually you end up with everybody else's money. Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 The trouble with capitalism is that eventually you end up with everybody else's money. Quote Link to comment Share on other sites More sharing options...
JimDiGritz Posted June 16, 2011 Share Posted June 16, 2011 (edited) Complete twaddle. What was that I heard at ?The middle classes are to blame because they aren't able to borrow enough to power the recovery. This shithead collaborated with the Clinton administration to engineer the US housing bubble... Edited June 16, 2011 by JimDiGritz Quote Link to comment Share on other sites More sharing options...
KingBingo Posted June 16, 2011 Share Posted June 16, 2011 So basically we need higher taxes, more government spending and more debt. The man is a genius, that will solve all the problems we have with oppressive taxation bloated government and unsustainable debt. I mean its a radical new approach, no one has tried that at any point in the last 50 years. Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 What was that I heard at ?The middle classes are to blame because they aren't able to borrow enough to power the recovery. That's not what he says. He says the middle class, unable to borrow, ... is at fault because they fight each other (natives/immigrant, labour/tory, etc.) over crumbs rather than stand up as one to reclaim what they had. Quote Link to comment Share on other sites More sharing options...
JimDiGritz Posted June 16, 2011 Share Posted June 16, 2011 (edited) That's not what he says. He says the middle class, unable to borrow, ... is at fault because they fight each other (natives/immigrant, labour/tory, etc.) over crumbs rather than stand up as one to reclaim what they had. Bol1ocks Here is the transcript: "The vast middle class, unable to borrow as it could before, no longer has the purchasing power needed to get the economy growing again. Which means continued high unemployment." Edited June 16, 2011 by JimDiGritz Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 So basically we need higher taxes, more government spending and more debt. The man is a genius, that will solve all the problems we have with oppressive taxation bloated government and unsustainable debt. I mean its a radical new approach, no one has tried that at any point in the last 50 years. Actually, raise tax rates on rich people back to what it was pre-1980 and government debt will be lower. We weren't in a depression pre-80 with higher tax rates for ultra high earners, we are in one now. Quote Link to comment Share on other sites More sharing options...
Number79 Posted June 16, 2011 Share Posted June 16, 2011 he is a good cartoonist, maybe he should look harder into that Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 Bol1ocks Here is the transcript: "The vast middle class, unable to borrow as it could before, no longer has the purchasing power needed to get the economy growing again. Which means continued high unemployment." Yes but he doesn't attribute fault as you implied. The fault he attributes to the division among ex-members of the middle class. Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 he is a good cartoonist, maybe he should look harder into that Maybe you should try and understand what he is saying. Chances are you are one of the mugs in this sorry business. Quote Link to comment Share on other sites More sharing options...
JimDiGritz Posted June 16, 2011 Share Posted June 16, 2011 Yes but he doesn't attribute fault as you implied. The fault he attributes to the division among ex-members of the middle class. No. He is clearly laying the blame for the current recession/depression on the fact that the middle class are unable to consume because they are unable to borrow as they had before. He is advocating more debt based growth, and is therefore a moron. Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 No. He is clearly laying the blame for the current recession/depression on the fact that the middle class are unable to consume because they are unable to borrow as they had before. He is advocating more debt based growth, and is therefore a moron. This is going to be a long night. No, he doesn't say their lack of borrowing power is at fault. He says their inability to borrow subsequent to stagnant wages stops them from consuming more. The root cause of the problem as he presents it is clearly shown to be stagnant wages and rising inequalities. He is not advocating for people to borrow more, he wants their share of the national income to go up so they can spend more. Quote Link to comment Share on other sites More sharing options...
KingBingo Posted June 16, 2011 Share Posted June 16, 2011 Actually, raise tax rates on rich people back to what it was pre-1980 and government debt will be lower. We weren't in a depression pre-80 with higher tax rates for ultra high earners, we are in one now. Yes because if I am a 'super rich' living in London and the top rate of tax gets jacked up to 75% I will gladly pay that....... For about 15 minutes before I f@@k off to Monaco and take my spending and investment and in all likelihood jobs creation with me. This is a global world and if you kill the goose that lays the golden eggs you stop getting any eggs at all. That man is a good cartoonist and a crappy economist. Quote Link to comment Share on other sites More sharing options...
KingBingo Posted June 16, 2011 Share Posted June 16, 2011 This is going to be a long night. Given that you think its everyone else that has misunderstood I think your right .........this is going to take a while. Quote Link to comment Share on other sites More sharing options...
General Congreve Posted June 16, 2011 Share Posted June 16, 2011 It's all academic anyway guys. It's too late to argue the finer points, every thing's fubared now. Duck and cover! Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 Yes because if I am a 'super rich' living in London and the top rate of tax gets jacked up to 75% I will gladly pay that....... For about 15 minutes before I f@@k off to Monaco and take my spending and investment and in all likelihood jobs creation with me. I see you know very well that wealthy people pay virtually no tax whatever the official rates may be. Only the mugs get hit with the full rate and they are no super rich. This is a global world and if you kill the goose that lays the golden eggs you stop getting any eggs at all. With that approach you are guaranteed to get no egg at all. It's just too easy to play one country against another until you reach 0. As has already happened in the UK. Quote Link to comment Share on other sites More sharing options...
Number79 Posted June 16, 2011 Share Posted June 16, 2011 Maybe you should try and understand what he is saying. Chances are you are one of the mugs in this sorry business. I understand exactly what he is saying but it is you that doesnt understand enough to know what he is missing and why he is wrong. Quote Link to comment Share on other sites More sharing options...
Number79 Posted June 16, 2011 Share Posted June 16, 2011 This is going to be a long night. No, he doesn't say their lack of borrowing power is at fault. He says their inability to borrow subsequent to stagnant wages stops them from consuming more. The root cause of the problem as he presents it is clearly shown to be stagnant wages and rising inequalities. He is not advocating for people to borrow more, he wants their share of the national income to go up so they can spend more. How does being able to consume more shit from China aid the US economy? Quote Link to comment Share on other sites More sharing options...
KingBingo Posted June 16, 2011 Share Posted June 16, 2011 I see you know very well that wealthy people pay virtually no tax whatever the official rates may be. Only the mugs get hit with the full rate and they are no super rich. No, the rich play plenty of tax. Check the official statistics. I know they pay a lower amount on capital gains, but that is money they have already earned and paid tax on. In fairness they should pay zero on capital gains tax. With that approach you are guaranteed to get no egg at all. No, think about it again. Think really hard. Getting no eggs at all is precisely what your approach gives us. And thank God for competition between countries. Competition is a GOOD thing! Quote Link to comment Share on other sites More sharing options...
silver surfer Posted June 16, 2011 Share Posted June 16, 2011 The fault he attributes to the division among ex-members of the middle class. A banker, a Daily Mail reader, and a benefits claimant are sitting down having a cup of tea together. They order a plate of biscuits and the waitress brings twelve Hob Nobs. The banker takes eleven of them and turns to the Daily Mail reader, "watch out for the benefits claimant" the banker says "he's got his eye on your Hob Nob". Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 (edited) How does being able to consume more shit from China aid the US economy? Ignoring your previous post, you are missing what is happening in aggregate. Inflation without middle class wage inflation year after year leads to the top x% getting a greater and greater share of national income. The inevitable consequence is very low rates of interest, very high asset prices and a busted middle class. The top x% save much more of their incomes than the middle class. As they do, decade after decade, their investments generate stealth inflation by raising asset prices and buying bonds (thus lowering rates). As time passes their share of national income and accumulation of assets become great enough to have a significant impact on asset prices and interest rates. Investing in industrial capacity stopped being a good proposition from the early 1970s (with a 15 years exception in China). So year after year you get more stealth inflation without wage rises. Together with lower rates it encourages people to borrow to compensate for stagnant wages (what's the current income multiple on housing?). Increased debts lead to rising national income, but the increase goes straight to the top x as wages are still stagnant. And so the top x% share of national income keeps increasing again leading to stealth inflation and lower rates, year after year, decade after decade with the result we see today. The process is quite mechanical in that there is very little choice in it. That is the root cause of what we are experiencing today, enabled by authorities sympathetic to 'mild' inflation. You get a few noises here and there (bubbles, etc.) but the underlying trend, slow as it is, is what supports the whole edifice. And it is very strong. We are now going through a phase of blatant take over of our legislative and executive processes by those top x%. But by all means keep ignoring this and blame Labour, or the Tories. Edited June 16, 2011 by _w_ Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 No, the rich play plenty of tax. Check the official statistics. I know they pay a lower amount on capital gains, but that is money they have already earned and paid tax on. In fairness they should pay zero on capital gains tax. BS! First the rich pay virtually no tax. Second, your idea of fairness is that the richest should pay no or little tax while the schmuck who works 40-60 hours a week pays 40 to 60% depending on how much he earns. Do you realise how twisted your thinking is? Quote Link to comment Share on other sites More sharing options...
_w_ Posted June 16, 2011 Author Share Posted June 16, 2011 No, think about it again. Think really hard. Getting no eggs at all is precisely what your approach gives us. Perhaps you need to follow your own advice. But before you do that real hard thinking just look at history, all the answers are there. Quote Link to comment Share on other sites More sharing options...
Number79 Posted June 16, 2011 Share Posted June 16, 2011 Ignoring your previous post, you are missing what is happening in aggregate. Inflation without middle class wage inflation year after year leads to the top x% getting a greater and greater share of national income. The inevitable consequence is very low rates of interest, very high asset prices and a busted middle class. The top x% save much more of their incomes than the middle class. As they do, decade after decade, their investments generate stealth inflation by raising asset prices and buying bonds (thus lowering rates). As time passes their share of national income and accumulation of assets become great enough to have a significant impact on asset prices and interest rates. Investing in industrial capacity stopped being a good proposition from the early 1970s (with a 15 years exception in China). So year after year you get more stealth inflation without wage rises. Together with lower rates it encourages people to borrow to compensate for stagnant wages (what's the current income multiple on housing?). Increased debts lead to rising national income, but the increase goes straight to the top x as wages are still stagnant. And so the top x% share of national income keeps increasing again leading to stealth inflation and lower rates, year after year, decade after decade with the result we see today. The process is quite mechanical in that there is very little choice in it. That is the root cause of what we are experiencing today, enabled by authorities sympathetic to 'mild' inflation. You get a few noises here and there (bubbles, etc.) but the underlying trend, slow as it is, is what supports the whole edifice. And it is very strong. We are now going through a phase of blatant take over of our legislative and executive processes by those top x%. But by all means keep ignoring this and blame Labour, or the Tories. What you are describing has happened time and time again and as you point out it is very mechanical and there is very little choice in it. I dont blame liebour or the tories, it doesnt matter what colour tie they wear because they all get their strings pulled by the rich and truly powerful. This is what you describe and what is happening today, it was written about the collapse of Argentina some years ago... It happened 4 years ago, almost a year after the December 2001 crisis. It was a social studies class and this teacher, don’t remember if it was a he or a she, was explaining the different kinds of social pyramids. God! Now I remember more! We even had a text book with those darn, cruel pyramids! The first pyramid explained the basic society. A pyramid with two horizontal lines, dividing those on top (high social class) those in the middle (middle class) and the bottom of the pyramid (the poor, proletarian). The teacher explained that the middle of the pyramid, the middle class, acted as a cushion between the rich and the poor, taking care of the social stress. The second pyramid had a big middle section, this was the pyramid that represents 1st world countries. In which the bottom is very thin and arrows show that there is a possibility to go from low to middle class, and from middle to the top of the social pyramid. Our teacher explained that this was the classic, democratic capitalist society, and that on countries such as Europeans one, socialists, the pyramid was very similar but a little more flat, meaning that here is a big middle section, middle class, and small high and low class. There is little difference between the three of them. The third pyramid showed the communist society. Where arrows from the low and middle class tried to reach the top but they bounced off the line. A small high society and one big low society, cushioned by a minimal middle class section of pyramid. Then we turned the page and saw the darned fourth pyramid. This one had arrows from the middle class dropping to the low, poor class. “What is this?” Some of us asked. The teacher looked at us. “This is us” “It’s the collapsed country, a country that turns into 3rd world country like in pyramid five where there is almost no middle class to speak, one huge low, poor class, and a very small, very rich, top class.” “What are those arrows that go from the middle to the bottom of the pyramid?” Someone asked. You could hear a pin drop. “That is middle class turning into poor” Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.