What the stimulus program is

[Dejavu]

It kinda makes me laugh when i think about it how close the word stimulus is to what i think the program actually is. Think about the stimulus program as if it were a stimulant drug and this package was just our latest fix.

The federal reserve is our dealer... they give us what we want and we react to it as necessary increased tolerance as it were. They are careful most of the time not to give us too much because they don't want us to overdose and i don't know... quit.

Here is the problem... the longer we are using with this current system the more that it takes to get the same effect. years ago there was an uproar when a bill reached anywhere near a billion dollars and now we are throwing around trillions like there is no tomorrow.

Hmmm like there is no tomorrow that is an interesting phrase. The current brain of our country (aka the leadership) is tossing out signals that tomorrow will be a complete catastrophe if we do not act immediately and get more drugs in our system because we like the feeling of a booming economy and we are used to it and we like to feel happy.

Wouldn't you like to feel happy all the time... drugs will do that for you... you can take E until your heart explodes and you'd probably have a good time doing it, but the fact is the feeling is unsustainable and to try to sustain it is only going to kill you.

The reason that we are entering into a recession is because we need it. The bubble was blown up and we need to withdraw. Sure we can pass this stimulus and who knows 3 weeks from now we can all feel on top of the world again... but it wont last... it was still just a bubble that needs to deflate. We can keep trying these stimulus packages but the problem is that sooner or later it might kill us.

If we allow ourselves to withdraw and return to levels that are natural with interest rates that are set by the market and a money supply that maintains its value we can once again be happy on our own. The booms may not be as fun but the busts will be incredibly more manageable and less frequent.

The problem is that this story is not about some drugged out loser that could die and like 3 people would care. This story is ours and thanks to our current choices our grand children's future. We are the heart of this body and we need to signal the brain that these choices that they are making are horrible and going to cripple our kill us if they continue at their current pace.

And no i did not copy and paste this from somewhere these are my personal feelings on the subject and as such i would welcome anyone to change my mind on this current fiasco but personally i find Keynesian economics to be completely fucking retarded.

 

[Halifirien]

...personally i find Keynesian economics to be completely fucking retarded.

As a Libertarian, I can see why you would. Libertarians aren't in charge. If you want to spur the economy, investing in infrastructure projects that create jobs and improve future conditions isn't a bad deal. If the private sector won't (or can't) spend, the government can. At the very least, it can soften the economic blow.

 

[ds083roadkill]

all it is i just getting a portion of your tax return early.

 

[Xalioniaf]

Wouldn't you like to feel happy all the time... drugs will do that for you... you can take E until your heart explodes and you'd probably have a good time doing it, but the fact is the feeling is unsustainable and to try to sustain it is only going to kill you.

One of two things are gonna happen: you're either gonna go to jail... or you're gonna die. But you're gonna be real happy.

 

[Dejavu]

As a Libertarian, I can see why you would. Libertarians aren't in charge. If you want to spur the economy, investing in infrastructure projects that create jobs and improve future conditions isn't a bad deal. If the private sector won't (or can't) spend, the government can. At the very least, it can soften the economic blow.

What is wrong with doing nothing and having a recession... it will be tough don't get me wrong but it will make the companies that do survive even stronger. At this point spurring our economy is about the last thing we should do because it will only make us weaker in the long run. I agree though that if there is going to be spending it should be on infrastructure but at this point i have already been hearing a scary word going around and that is "monetize". To most people this word probably sounds pretty innocent but there are some major implications behind it.

The way that the money supply works "in a perfect situation" is that the treasury sells treasury bills to investors with the promise that sooner or later they will be paid back. Now the problem with this system is that someone has to be willing to buy them. When i hear the word monetize the only thing that this can mean is that no one is willing to buy these bonds and the only group that can then buy them is the federal reserve and they are therefore going to print the money as opposed to borrowing it.

Please explain to me why you think Keynesian economics will actually work.
Who will pay for it?
Whats to stop us from needing more in 2 months?
Where is the line where we give up and accept our fate?

I am reminded of a concept i learned in a business class of setting boundaries. The example the teacher used is drilling for oil. He said before you start you have to decide exactly how deep you are willing to go to look for oil before you decide that the whole is dry. The reason is that if you do not set this goal ahead of time you will always be sitting there telling yourself that the oil is there but it is only another 10 feet. Now you could be right but most of the time you wont be and by setting this threshold ahead of time and having the fortitude to stick with it you can avoid making a lot of bad decisions. This is the situation i find this country in at the moment. We are drilling like crazy hoping to recover our losses but we should have moved on a while ago and taken our losses while they were less significant.

all it is i just getting a portion of your tax return early.

Not really this is just your generation collecting on your grand kid's taxes but don't worry... they cant stop you they are not born yet.

One of two things are gonna happen: you're either gonna go to jail... or you're gonna die. But you're gonna be real happy.

that was kinda my point... with this strategy i do not understand how there can be a happily ever after.

 

[Halifirien]

Double-post.

 

[Halifirien]

What is wrong with doing nothing and having a recession...

Plenty of economists are united in saying it won't be anything as nice as a recession. We're talking a major depression that wouldn't just be "tough" for a lot of people. If we, through our elected leaders, can do anything to stave that off, we should do it.

Please explain to me why you think Keynesian economics will actually work. Who will pay for it?

The same people who'll be paying for the war in Iraq -- similar pricetag to the stimulus package, but at least we'll be getting something useful out of it -- and the gargantuan increase in the federal deficit under the Republicans, I guess.

 

[Dejavu]

Plenty of economists are united in saying it won't be anything as nice as a recession. We're talking a major depression that wouldn't just be "tough" for a lot of people. If we, through our elected leaders, can do anything to stave that off, we should do it.

I agree at this point due to our fiscal policies of the past it will most likely be a depression and not a recession but that is only because we are further along in the process than we should be. As far as i can tell our problems started in 1995 when the dot com bubble started. The dot coms grew and grew on speculation until in ~2000 they "burst" and many companies and investors got crushed. Because of this the federal reserve decided to stave off what would have been a relatively minor recession by lowering the interest rate therefore stimulating borrowing and as you call it softening the landing. The interest rates were already coming down and then OMG 9/11 and the president says spend or the terrorists win... so the fed goes... i can help and lowers the interest rates even further. This leads to a ridiculous increase in home prices and the feeling that everyone must own a house.

Since credit is soo easy to get from the fed the banks start borrowing it as fast as they can start loaning the money to people who really should not be receiving the loans. (aka sub prime) Also at the same time they come up with the wonderful idea of adjustable rate mortgages. Oh you cant afford that house now... you think you could in three years when it adjusts??? good enough for me!

The economy appears to recover a bit so the interest rates start to creep back up until October of 2007 when low and behold the people who shouldn't have gotten loans in the first place are unable to cover their loans have their rates readjusted and now they cant even come close to covering their loans.

Oh noes banks are not getting the money back that they loaned to people... We need more suckers... i mean people to buy houses so that we can get our money back...

Federal reserve to the rescue i can lower the interest rates again and this time i will go even lower... wait thats not working? how about a stimulus package and a bailout or 2.

Oh thank god the federal reserve is here to reinflate the bubble so that when it really does pop it fucks us all.

The economy right now is like a roller coaster... and the problem is every drop is getting worse than the last and sooner or later it will be out of control... but i fear we are already to that point.

Yes it probably will be a depression... but that will be a fuckton better than what we will be facing next time when the conditions are worse and a roll of toilet paper costs $50 because of all the inflation we are creating now.

The same people who'll be paying for the war in Iraq -- similar pricetag to the stimulus package, but at least we'll be getting something useful out of it -- and the gargantuan increase in the federal deficit under the Republicans, I guess.

No disagreement here... i was against that as well... remember i am not a republican either.

 

[Bustaballs]

Hey, man. I agree with you completely on the economic situation but don't use E as your analogy. E is a relatively benign drug that is about as dangerous as caffeine when used properly. It's also not physically addictive.

 

[Dejavu]

This is perhaps the most disorganized show i have ever seen on air but it has several political minds that are worth listening to.

Peter Schiff is a great economist from a large perspective but i wouldnt actually give him money cause although i agree with his assessment i disagree with his strategy as to how to play it.

Cody Wilard although i dont really like his show i agree with almost everything he says.

Lew Rockwell is the de facto leader of the libertarian movement

Ron Paul is.. well our 1 competent congressman.

Judge Napolitano wrote an excellent book called a Nation of Sheep.

Along with some other people who i have seen before but have no real opinion on.

One hr show but worth watching

 

[Keryan]

The stimulus money is being provided by England and China.... Not your tax dollars. Your tax dollars and that of the next two generations will go to PAY for it. The more money we print out the lower the value of the US dollar becomes. All I can say about this is~ What else can you expect when people put someone with no real knoweldge of how to run even a bussiness as President. He called the 800 BILLION bank bail out multitasking, then did not even require oversight for it. Mind you over 150 BILLION was not even for banks but for states that has natural disasters. It was put in to get those extra votes to pass the damn thing.

This package has over 300 BILLION in spending that falls under senators pet projects. The senators use the reasoning that it will create jobs... Like that light rail from Vegas to disneyland. My favorite is the one where 50 MILLION is spent on a habitat for SAND MICE. This stimulas package could have been for a lot less money and still had covered the infrastructure jobs. As for this pet jobs that will be created. These are not long term jobs. Just short term. This is nothing more than a band aid placed over arterial bleeding. We need to tell our elected officals to stop screwing about and actually do the job right.

 

[Strid]

My favorite uses of this money, so far that haven't been stated, would have to be the money that will be used to build the railway from Las Vegas to a Disney Land and the $75 billion goin' to help people keep their homes who do not belong in them to begin with. This guy is a real genius.

 

[Pompidou]

The real geniuses were the banks and corporations who used shady business practices and caused this problem in the first place. People who took mortgages they couldn't afford are at fault also, but if the banks and corporations are being bailed out, so should the families. I don't think anyone at all should've been bailed out. I say let the groups that exploited a known issue sink with their ship. I agree with Dejavu in that our whole economy needs to just start over - the whole world. We were riding a bubble of lies. It's time to find out where we really stand. Our dollar should be valued on something concrete, and not on debt. I agree with Strid that the people with bad mortgages should be left to their demise. I disagree with his kinder stance on the banks and corporations in an argument in another thread. Everyone who exploited faulty economics should pay the price.

 

[Strid]

I disagree with his kinder stance on the banks and corporations in an argument in another thread. Everyone who exploited faulty economics should pay the price.

Considerin' I side with the idea that there should be no bailouts AT ALL, I wouldn't say I'm more kind to banks and corporations. I just know the banks and corporations aren't any more to blame than normal people themselves, and should be called out not worse, but equally. I know it's hip and cool to hate the "corporate machine" but don't be an idiot, they didn't cause this.

 

[Celvantes]

Like I said after the election... America got the President and Congress (moreso congress in this case, though the President could have spoken out against it if he wanted to) it deserved.

Hope everyone likes inflation, because that's what happens when you just print more money.

I also hope everyone likes having their national defense on a shoestring budget because the entire DoD has been ordered to reduce its spending by 10% (which is a shit ton of money when you're looking at the entire defense budget).

While engagements in Iraq and Afghanistan may lead the public to believe we're huge, strong and healthy, the truth of the matter is that the military has been downsizing, and trimming the fat *already* for the past 5 years. We're getting to the point where mission capability is going to start being jeopardized. And while the new government can see fit to DOUBLE its entire annual budget for the sake of economic stimulus and social welfare, it can't even *maintain* the military budget during a time of war when we're engaged in two theaters.

Small example: the majority of the tanker aircraft we fly are KC-135s. These are aircraft so old that three generations of a single family have all flown the exact same tail number (meaning a specific aircraft, not just the aircraft type). Boeing had a new tanker ready for us years ago, yet they had to sell it to Italy just to break even because our government couldn't pull its head out long enough to finalize a tanker deal (nevermind the giant scandal that went along with it). Nearly three years later, we *still* don't have a new tanker, and thanks to our (lack of) an aquisitions budget, a fourth generation of Air Force pilost may end up flying the exact same jets as their great-grandfathers.

It makes for a hell of a story in terms of the greatness of military maintenance, but its a damned shitty way to finance a military.

We laugh at the office about this, but the sad truth is that its a laugh of desperation... the only thing you can manage to do when you're backed into a corner with no foreseeable way out.

I just hope leadership realizes how badly they are screwing things up before we get to the point where the situation is unrecoverable. I'd really hate to see the words "former superpower" associated with America, and I sure don't want to see either Russia, China, or the European Union become the preeminent power on the world stage.

 

[Dejavu]

 

[Halifirien]

I also hope everyone likes having their national defense on a shoestring budget because the entire DoD has been ordered to reduce its spending by 10% (which is a shit ton of money when you're looking at the entire defense budget).

I love ya, Celvantes, but I've gotta call bullshit on that one. The DoD isn't getting its budget cut by 10%. Obama's budget calls for an increase in defense spending, giving them 8% more than what Bush and friends gave them last year, and that's not even factoring in Iraq and Afghanistan. The Joint Chiefs asked for a huge increase and they're not getting as much as they requested, but still more than they had last year.

That's not a cut in defense spending, except maybe in some Oxycontin-fueled Limbaugh fever dream.

 

[Celvantes]

I love ya, Celvantes, but I've gotta call bullshit on that one. The DoD isn't getting its budget cut by 10%. Obama's budget calls for an increase in defense spending, giving them 8% more than what Bush and friends gave them last year, and that's not even factoring in Iraq and Afghanistan. The Joint Chiefs asked for a huge increase and they're not getting as much as they requested, but still more than they had last year.

That's not a cut in defense spending, except maybe in some Oxycontin-fueled Limbaugh fever dream.

The Obama administration has asked the military's Joint Chiefs of Staff to cut the Pentagon's budget request for the fiscal year 2010 by more than 10 percent -- about $55 billion -- a senior U.S. defense official tells FOX News.
Last year's defense budget was $512 billion. Service chiefs and planners will be spending the weekend "burning the midnight oil" looking at ways to cut the budget -- looking especially at weapons programs, the defense official said.
Some overall budget figures are expected to be announced Monday.
Obama met Friday at the White House with a small group of military advisers, including Admiral Mike Mullen, chairman of the Joint Chiefs, Gen. James Cartwright, vice chairman, and Gen. Jim Jones, National Security Council chairman.

30 Jan 2009 was the date on this.

Word down military channels is that the budget reduction is still in effect.

I'll believe that 8% when I see where it's going. 8% increase in spending on Iraq and Afghanistan does NOTHING for the military as a whole. Think of Irag/Afghanistan spending as money spent on utilities whereas the normal DoD budget is money spent on a mortgage.

What I've seen is the US government skimping on mortgage payments to pay the utilities.

 

[Dejavu]

Apparently i am not the only person who seems to have realized this analogy. But this guy is much more articulate than I.