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DOW below 10,000 for the first time in 4 years (pg. 11)
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| inconspicuous |
| it's under nine thousaaaaaaaaaaaaaaaaaaaaaaaaaaaaaand |
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| pkcRAISTLIN |
| quote: | Originally posted by Krypton
How so? |
Where would all the money to bailout the financial system come from? The whole reason the great depression was "great" is because the government's hands were tied and couldn’t intervene to prevent further collapses and they couldn’t spend their way out of depression (which is what the rest of the countries who were not tied to gold did). |
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| Krypton |
| quote: | Originally posted by pkcRAISTLIN
Where would all the money to bailout the financial system come from? The whole reason the great depression was "great" is because the government's hands were tied and couldn’t intervene to prevent further collapses and they couldn’t spend their way out of depression (which is what the rest of the countries who were not tied to gold did). |
Didn't that result in hyper-inflation in Germany (which helped Hitler come to power)? And didn't Roosevelt confiscate everyone's gold? |
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| pkcRAISTLIN |
| quote: | Originally posted by Krypton
Didn't that result in hyper-inflation in Germany (which helped Hitler come to power)? And didn't Roosevelt confiscate everyone's gold? |
the hyper-inflation in germany was due to reparations they couldnt afford to pay. dont know about roosevelt.
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The gold standard and the Great Depression. The current judgment of economic historians (see, for example, Barry J. Eichengreen, Golden Fetters) is that attachment to the gold standard played a major part in keeping governments from fighting the Great Depression, and was a major factor turning the recession of 1929-1931 into the Great Depression of 1931-1941.
Countries that were not on the gold standard in 1929--or that quickly abandoned the gold standard--by and large escaped the Great Depression
Countries that abandoned the gold standard in 1930 and 1931 suffered from the Great Depression, but escaped its worst ravages.
Countries that held to the gold standard through 1933 (like the United States) or 1936 (like France) suffered the worst from the Great Depression
Commitment to the gold standard prevented Federal Reserve action to expand the money supply in 1930 and 1931--and forced President Hoover into destructive attempts at budget-balancing in order to avoid a gold standard-generated run on the dollar.
Commitment to the gold standard left countries vulnerable to "runs" on their currencies--Mexico in January of 1995 writ very, very large. Such a run, and even the fear that there might be a future run, boosted unemployment and amplified business cycles during the gold standard era.
The standard interpretation of the Depression, dating back to Milton Friedman and Anna Schwartz's Monetary History of the United States, is that the Federal Reserve could have but for some mysterious reason did not boost the money supply to cure the Depression; but Friedman and Schwartz do not stress the role played by the gold standard in tieing the Federal Reserve's hands--the "golden fetters" of Eichengreen.
Friedman was and is aware of the role played by the gold standard--hence his long time advocacy of floating exchange rates, the antithesis of the gold standard. |
http://www.j-bradford-delong.net/Po...ldstandard.html |
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| pkcRAISTLIN |
| Can I just point out that australia has an evil floated currency and we have a budget surplus of billions of dollars? Its not the system that's the problem, it is how it is managed ;) |
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| Krypton |
| quote: | Originally posted by pkcRAISTLIN
Can I just point out that australia has an evil floated currency and we have a budget surplus of billions of dollars? Its not the system that's the problem, it is how it is managed ;) |
Yea, we know, Australia is the shizzle... |
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| Capitalizt |
| quote: | Originally posted by pkcRAISTLIN
if you guys were on the gold standard right now you would be more ed than totally ed. |
True. But a gold standard would never have allowed a multi-trillion dollar credit bubble to form in the first place. Companies and government would not have been to allowed to loan such a ridiculous multiple of their actual assets. The amount of "money" created over the past 10 years was an illusion..and now that the illusion has been shattered we are in for a world of pain.
Going to the gold standard now would be a disaster, I agree...but only because we have been addicted to an endless supply of paper for so long, and because the rest of the world is still clinging to the dream that this system can be saved. Governments and central banks are going to keep fighting the correction..keep intervening in the markets, nationalizing industries, printing, inflating, and praying that things will be ok (they won't).
A competitive devaluation of paper currencies is in the future for all of us. This means massive inflation. You may not want to believe it but I hope you will at least take some small steps to prepare for it. |
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| iammesol |
| Japan's market is flirting with -10% |
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| Krypton |
| quote: | Originally posted by iammesol
Japan's market is flirting with -10% |
Can't wait for the European market to open...and then our market...:nervous: |
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| Capitalizt |
| quote: | Originally posted by inconspicuous
it's under nine thousaaaaaaaaaaaaaaaaaaaaaaaaaaaaaand |
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| Rostros |
The whole economy is screwed , I know the Dow Jones is looking bad but so is the FTSE 100, I was expecting the markets to recover when Mr Brown injected £500,000,000,000 yes that's £500 Billion into the banking system and nothing has improved also with the Icesave bank going under lots of local councils are missing millions.
Also the property market isn't looking to good either there are lots of of people like myself with massive mortgages but with declining house prices I soon could be in negative equity in a few years. As for Interest rates i was suprised the see the USA with a 1.5% interest rate thats is so low and you guys are still having problems.
Im not sure whats next as nobody wants to invest or buy , If you buy shares now you could be waiting many years to see a return maybe 10-20 years who knows.
*ucked and this is only the beginning |
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| iammesol |
| quote: | Originally posted by Krypton
Can't wait for the European market to open...and then our market...:nervous: |
FTSE down 8.86% @ 9:22am eastern |
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