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Originally posted by DJ Eco See, this is where I think we have a complete difference in opinion. The housing prices boomed because of the extreme ease at which one could get a loan from a bank to pay the demanded price.

Which resulted because of government institutions (Fannie and Freddie) who backed the loans made on top of the the Federal Reserve pushing interest rates lower and lower.

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College prices could go up because of how easy it was for the bank to hand the kid a check for $30,000 each year. The banks lent money out with complete disregard and without ever thinking about the consequences that would ensue if just 10% of those loans could not be paid back. They went haywire, and it was all their fault.

Again, many of the student loans made are supported by the state, just like mortgages in the housing industry. Also keep in mind that the Federal Reserve has been buying up bad debt from banks in order to prevent them from going under. With this type of support, incentive to make sure a loan won't go sour or shouldn't be made at all is lost.

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I'm not sure that makes any sense. Most of the problems I listed are due to complete unregulation. I think college tuitions need to be regulated. They're not now, and it's almost a joke how high they are and how much they increase per year. College prices and real estate values are two things that have almost completely no regulation on the part of the government.

So you are saying that prices need to be regulated? We should be price fixing? I take it you have no idea how bad of an idea that is and that you've never studied or read about what happens and what has happened in the past when the government does this?

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No I absolutely understand the concepts of profit and basic economics principles. I'm saying that the quest for unprecedented profit margins has become more than just something a business structures itself around, and has made its footprint over so many aspects of our society and even identity as Americans. Things have reached a tipping point where I think it's gone too far. By simply justifying things in an economic sense, our society has quickly been going in a downward spiral; I made short anecdotal examples of how the ripples of our now overly-capitalistic model of society are affecting so many aspects of our lives. If everyone worked a max. of 8 hours a day and salaries were increasing with parity to increases in costs of basic things like food and transportation, I think many of our country's problems would go away.

What is your definition of capitalism?

Also, it appears that you believe force should be used in order to prevent a lot of the things that you don't approve of. If I'm wrong, please correct me, but you seem to be hinting towards a government solution to a government problem, and you have to understand that government functions through the use of force, not through voluntary exchange. By advocating "regulations" in the way that you seem to be advocating, you are essentially approving the use of force. I hope you understand this.

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Originally posted by DOOMBOT Which resulted because of government institutions (Fannie and Freddie) who backed the loans made on top of the the Federal Reserve pushing interest rates lower and lower.

This statement is extremely misleading. Fannie and Freddie are the exact result of what happens when previous government functions get privatized. They had't been fully regulated by the US government for decades if I'm not mistaken. Ironically, it was traded on Wall Street, had CEOs and was only recently unlisted. This is exactly in-line with what I've been saying all along. Fannie and Freddie were actually giving campaign contributions! To call it government regulation is the furthest thing from the truth. We're actually bailing it out right now, and even now, the idiots in Washington haven't put regulations on what's going to happen next. We're just pouring almost $200 billion of our tax money into something that can (as of now) easily come back and fuck things up.

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Originally posted by DOOMBOT Again, many of the student loans made are supported by the state, just like mortgages in the housing industry. Also keep in mind that the Federal Reserve has been buying up bad debt from banks in order to prevent them from going under. With this type of support, incentive to make sure a loan won't go sour or shouldn't be made at all is lost.

I don't call this "regulation", that's corporate strong-arming and infiltration and lobbying of the House and the Senate. People who were proclaimed to be much smarter than us in economics and finance said not bailing them out would be disastrous to our nation. So we did; and they've been seeing record profits.

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Originally posted by DOOMBOT So you are saying that prices need to be regulated? We should be price fixing? I take it you have no idea how bad of an idea that is and that you've never studied or read about what happens and what has happened in the past when the government does this?

Absolutely not. For extremely limited things like tuitions and healthcare, I think price fixing should be enacted. The health and education of the people are not things that should be talked about in terms of profits and deficits. I know real estate was in the same sentence as "tution" in my previous post, but just to reassure you, NO, obviously no price fixing in that or most anything else. I also briefly mentioned that wages should be regulated, but obviously, full-on wage regulation is wishful thinking and disastrous. Some sort of standard wage increase should be enacted across the board though. It should be illegal to freeze wages, or there should be a relatively very small increase in wage percentage somehow loosely relative to factors like how well the company did that year vs. how many employees it shed off.

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Originally posted by DOOMBOT Also, it appears that you believe force should be used in order to prevent a lot of the things that you don't approve of. If I'm wrong, please correct me, but you seem to be hinting towards a government solution to a government problem, and you have to understand that government functions through the use of force, not through voluntary exchange. By advocating "regulations" in the way that you seem to be advocating, you are essentially approving the use of force. I hope you understand this.

I am advocating the "use of force" (semantics) on regulating certain absolutely critical aspects of our society. Privatizing EVERYTHING hasn't really been working for us.

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Originally posted by DJ Eco This statement is extremely misleading. Fannie and Freddie are the exact result of what happens when previous government functions get privatized. They had't been fully regulated by the US government for decades if I'm not mistaken. Ironically, it was traded on Wall Street, had CEOs and was only recently unlisted. This is exactly in-line with what I've been saying all along. Fannie and Freddie were actually giving campaign contributions! To call it government regulation is the furthest thing from the truth. We're actually bailing it out right now, and even now, the idiots in Washington haven't put regulations on what's going to happen next. We're just pouring almost $200 billion of our tax money into something that can (as of now) easily come back and fuck things up.

You are mistaken, they are GSEs. Look up what a GSE or Government Sponsored Enterprise is. To say it is not government regulation is the furthest from the truth and 100% incorrect.

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I don't call this "regulation", that's corporate strong-arming and infiltration and lobbying of the House and the Senate. People who were proclaimed to be much smarter than us in economics and finance said not bailing them out would be disastrous to our nation. So we did; and they've been seeing record profits.

I'm not sure what this has to do with the part of my reply that you quoted.

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Absolutely not. For extremely limited things like tuitions and healthcare, I think price fixing should be enacted.

Why did you say absolutely not, then go right into saying that price fixing should occur?

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The health and education of the people are not things that should be talked about in terms of profits and deficits.

What are you talking about?

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I know real estate was in the same sentence as "tution" in my previous post, but just to reassure you, NO, obviously no price fixing in that or most anything else.

I don't know what you are saying here.

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I also briefly mentioned that wages should be regulated, but obviously, full-on wage regulation is wishful thinking and disastrous.

You sure do contradict yourself a lot. "Wages should be regulated but wage regulation is bad." You are confusing.

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Some sort of standard wage increase should be enacted across the board though.

Why?

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It should be illegal to freeze wages, or there should be a relatively very small increase in wage percentage somehow loosely relative to factors like how well the company did that year vs. how many employees it shed off.

So if a company can't afford to pay it's workers an increase in wages, it should be forced to anyway? If my company had not had a wage freeze, for example, my company probably wouldn't be around right now and I'd be out looking for a job. It was something that had to be done, unfortunately.

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I am advocating the "use of force" (semantics) on regulating certain absolutely critical aspects of our society. Privatizing EVERYTHING hasn't really been working for us.

So you'd rather government run institutions over privately run companies? And why did you capitalize "Everything?" You really believe that everything in the United States is privatized?

Last edited by DOOMBOT on Oct-03-2011 at 05:09

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Originally posted by DOOMBOT You are mistaken, they are GSEs. Look up what a GSE or Government Sponsored Enterprise is. To say it is not government regulation is the furthest from the truth and 100% incorrect.

They were traditionally founded GSEs but have been fully private institutions for the better part of a century. The government played little to no role in them during this time. Like I said, they were traded on Wall Street, had "CEOs", and gave campaign contributions. I'm going to reiterate, it wasn't being handled by any branch of government.

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Originally posted by DOOMBOT I'm not sure what this has to do with the part of my reply that you quoted.

You blamed the government for buying out bad loans. I'm saying okay, I'm not happy our government was buying out their bad loans, but the banks were the ones making some terrible decisions in the first place. They made a mess and our government had to clean it up because the banks convinced them they needed to.

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Originally posted by DOOMBOT Why did you say absolutely not, then go right into saying that price fixing should occur?

I'm not advocating across-the-board price fixing, like a one-size-fits-all statement. You can't take a statement of mine ("college tuition needs to be regulated"), then change its semantics ("we should be price fixing?"), and not expect me to further explain myself in other words. To reiterate, yes, I think the government should selectively "price fix" things like education, healthcare, and maybe public transportation. Any things outside that realm should not be touched.

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Originally posted by DOOMBOT What are you talking about?

The fact that you twisted my plea for government regulation of college tuitions as "price fixing" and said I should read up on how disastrous attempts at this would be, this means you completely missed my point. Giving people education and healthcare shouldn't be something we need to consult economists about. They shouldn't even be profit-making entities honestly.

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Originally posted by DOOMBOT I don't know what you are saying here.

Like I said, you kind of indiscriminately through everything I said into the "price fixing" category and I just wanted to make sure people understood that I meant it on a select few things. You were trying to trip me up there and are doing so right now as well.

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Originally posted by DOOMBOT You sure do contradict yourself a lot. "Wages should be regulated but wage regulation is bad." You are confusing.

You tried to trip me up again so I went into more detail and you keep doing it. No I don't think wages should be completely controlled by the State. I made a comment about wage regulation and realized later it might be misconstrued as Communism. No, I think small scale regulations can be made without it result in the government getting its hands too deep in others' affairs. I just think, people's salaries shouldn't be frozen for 3-4 years on end. The way prices of EVERYTHING have been rising, I think that's a crime.

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Originally posted by DOOMBOT So if a company can't afford to pay it's workers an increase in wages, it should be forced to anyway? If my company had not had a wage freeze, for example, my company probably wouldn't be around right now and I'd be out looking for a job. It was something that had to be done, unfortunately.

Companies will always find a way to keep on making more profits. Some of these bonuses and executive perks some companies make could save a few hundred or thousand employees sometimes. But that's besides the point, I think a company can find away to keep making their profits if a slight wage increase were implemented each year. Property taxes go up, electric goes up, shipping and transportation costs go up. Corporations find a way to deal. Why are PEOPLE thrown into the other category of things that corporation can't deal with?

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Originally posted by DOOMBOT So you'd rather government run institutions over privately run companies?

On certain things yes, on most things no.

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Originally posted by DOOMBOT And why did you capitalize "Everything?" You really believe that everything in the United States is privatized?

We're not in a court of law man, stop reading into a select few words and making that your argument, it's tedious and you haven't made a whole many factual points this time around, not gonna really waste my time answering your next batch of questions if they are "why", "what are you talking about", "you are confusing".

No, I don't think everything is privatized. Do I think more aspects of the way our country runs itself are privatized now than 40 years ago? Yes.

Our whole clean-up crew (for lack of a better word) in Iraq is privatized. Thousands of "TROOPS" are actually contract security guards not governed by the same rules as American soldiers. They have tanks, warships, and their own camps. These are billion dollar deals our tax payers are paying toward private corporations.

Thousands of schools are turning into charter schools. Many kids don't even have a choice now to go to public school. These schools hire kids straight out of college to teach our children and don't really want to pay someone more experienced and more expensive. They're corporations looking after the bottom line. Sure, I am all for giving teachers jobs out of college, but not an entire faculty room of them, and definitely not by leaving previous older public school teachers to rot because they're not in the charter school's salary budget.

This is just the tip of the iceberg.

___________________
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if these people really wanna hurt the bank's they should just take all of their money out of them and stop using their credit cards

___________________
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Originally posted by DJ Eco They were traditionally founded GSEs but have been fully private institutions for the better part of a century. The government played little to no role in them during this time. Like I said, they were traded on Wall Street, had "CEOs", and gave campaign contributions. I'm going to reiterate, it wasn't being handled by any branch of government.room of them, and definitely not by leaving previous older public school teachers to rot because they're not in the charter school's salary budget.

The following is straight from Fannie Mae's web site (I underlined some things that I believe are important, to help you see that these are in fact arms of the government and are regulated by government entities): http://www.fanniemae.com/portal/index.html

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Fannie Mae is a government-sponsored enterprise chartered by Congress to keep money flowing to mortgage lenders, to help strengthen the U.S. housing and mortgage markets, and to support affordable homeownership. We are a national mortgage finance company, but we don’t offer home loans. We stand behind mortgage lenders – local and national banks, thrifts, credit unions, and other financial institutions in all 50 states – to securitize or buy the mortgage loans they originate, enabling them to replenish their funds so they can lend to other homeowners. Similarly, we work to keep funds flowing to support affordable rental housing ------------ By charter, our board is made up of 13 members or such other number that the Director of FHFA determines appropriate. FHFA has directed that our board will have a minimum of nine and not more than 13 directors.

The following comes from Fannie Mae's wiki article, which includes sources for the information:

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1990s In 1992, President George H.W. Bush signed the Housing and Community Development Act of 1992. The Act amended the charter of Fannie Mae and Freddie Mac to reflect Congress' view that the GSEs "have an affirmative obligation to facilitate the financing of affordable housing for low-income and moderate-income families."[14] For the first time, the GSEs were required to meet "affordable housing goals" set annually by the Department of Housing and Urban Development (HUD) and approved by Congress. The initial annual goal for low-income and moderate-income mortgage purchases for each GSE was 30% of the total number of dwelling units financed by mortgage purchases[15] and increased to 55% by 2007. In 1999, Fannie Mae came under pressure from the Clinton administration to expand mortgage loans to low and moderate income borrowers by increasing the ratios of their loan portfolios in distressed inner city areas designated in the CRA of 1977.[16] Because of the increased ratio requirements, institutions in the primary mortgage market pressed Fannie Mae to ease credit requirements on the mortgages it was willing to purchase, enabling them to make loans to subprime borrowers at interest rates higher than conventional loans. Shareholders also pressured Fannie Mae to maintain its record profits.[16]

And so on and so forth. I hope this helped clear some things up for you.

Last edited by DOOMBOT on Oct-03-2011 at 22:49

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Originally posted by DJ Eco You blamed the government for buying out bad loans. I'm saying okay, I'm not happy our government was buying out their bad loans, but the banks were the ones making some terrible decisions in the first place. They made a mess and our government had to clean it up because the banks convinced them they needed to.

Terrible decisions are going to be made in any type of economy. In a true capitalist environment, those who make terrible decisions go out of business and in return, free up scarce resources to businesses who make good decisions and use those resources wisely. A major problem that the United States is currently facing is that a lot of companies who made bad decisions are being saved by the state. This is what you are referring to when you say that the government "had to clean it up." If the state had not involved itself, many of the companies that you seem to hate wouldn't even be in existence anymore.

I appreciate DOOMBOT and DJ Eco having a civil discussion... awesome man. This stuff is rare on the internet.

Its amazing because DOOMBOT has the uncanny ability to take the normal person who's having a good day and piss them right off with his open ended questions. I appluad ECO for keeping level head.

Some thoughts: DOOMBOT refers to the FED as a govt institution (not in this thread, I just know he does). This may have caused some initial confusion. I Personally think its privately controlled and that the govt as well as private holders benefit from the FED's inflation.

Housing Bubble, College Bubble are both fueled by low interest rates, govt tax write offs for debt interest, and a pervasive american mentality of "going to school" as some kind of end-all be all. I know kids graduating with 70K in debt. That's quite a large setback. I'd say 3 out of 4 college kids is wasting their time.

Price Fixing causes markets to freeze up. If a state wants to lower its tuition costs it needs to turn off the easy student loan faucet. Tuitions will come down in a few years when the colleges realize how many empty seats there are.

Lets say for example americans are one day outraged at 5 dollar gasoline. Obama to the rescue, "I hearby declare that no gas station in the US of A sell gasoline at more than 5 dollars per gallon" *smacks his tyrant gavel*. Now suppose the cost of gas is really 5.25 that day. Gas station owners are swindled out of their ability to earn. Gas Stations close. Obama has made it unprofitable to be in the gasoline business. Maybe the government comes in and nationalizes all failing road side gas stations and fucks that operation up some more. Now gas is 10 dollars because govt workers dont understand the concept of profit and loss. P&L dont matter when you have a printing press (or at least it wont matter to them, just the poor sap who's elected a few years later and inherits the effects of the deficit).

Last edited by on Oct-04-2011 at 15:32

i stopped by today. Deff very informative, seems to be getting more organized.

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Originally posted by DOOMBOT A major problem that the United States is currently facing is that a lot of companies who made bad decisions are being saved by the state. This is what you are referring to when you say that the government "had to clean it up." If the state had not involved itself, many of the companies that you seem to hate wouldn't even be in existence anymore.

Yes yes yes, we're totally in agreement on that. And what our disagreement really involves is a semantics dispute. It's about semantics, in the sense that you are considering the bailouts as part of being under the "government regulation" umbrella, and I think they are the furthest thing from that. It was ill-informed, badly-timed and horribly planned government "intervention" but not "regulation". And in that sense, I am NOT with the Obama administration on this one. They were in the pockets of many corporations that are being kept alive with our tax money, except they're being kept alive and then prospering and not giving back.

Pinpoint-accurate government "regulation" would have made sure many of these companies didn't make bad decisions in the first place, and wouldn't warrant government intervention, aka the spending of our tax dollars. And yes, like you said, many of the companies I hate would either cease operations or keep a lower profile. And this is just one of a huge list of issues that angers me about the Obama administration. Protesting is as much on his shoulders as it is on any filthy rich CEO or executive that people think all our anger is geared towards.

The filthy rich execs of Wall Street are, yes, an easy target, but my anger is acutely focused on our lawmakers on Pennsylvania Avenue.

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Originally posted by pyro264jb i stopped by today. Deff very informative, seems to be getting more organized.

I was there too today, quiet, alone and taking it all in. I really enjoy the drum circle, but that's just me.

It's easy for passersby to walk past and see the hippies on the far reaches of the street dancing and singing. But when you walk in, you get a real sense of determination, passion, and people are more informed than the outsiders are giving them credit for.

Sure, the 3 or 4 that the newspaper journalists interviewed are supposedly "uninformed". But hey, so are we as an American public. Go to Times Square and ask everyone who our Vice President is, see if they all know. Where's the New York Times article calling them uninformed?

Regardless, I find that "uninformed" tag to be the furthest thing from the truth. The people who aren't there to get fucked up and kick their hackie sack around are actually well-knowledged and extremely eager to discuss in a friendly way. I saw people having very chilled out conversations with cops, there was absolutely no tension.

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