PRESIDENT GEORGE W. BUSH Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : PRESIDENT GEORGE W. BUSH

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: American Spirit who wrote (383976)	4/2/2003 1:19:23 AM
From: RON BL	Read Replies (1) of 769668

Below you will find a good analysis of the financial disaster that Clinton/Greenspan pushed on the American public. Its a long article called the Perfect Storm. I have include a portion of it. STORM FRONT #1: CREDIT EXPANSION The economic miracle so widely heralded by the Clinton Administration is the product of a loose monetary policy that has created the largest credit expansion in U.S. history. At first, the expansion of credit leads to an economic boom. Booms inevitably lead the way to busts that can ultimately lead to depressions. The initial stages of the boom create the illusion of prosperity. Policymakers may try to prolong the boom or bring temporary relief by manipulating the financial system with the creation of more money. But in the long run, they only buy an extension of time before the inevitable catastrophe unfolds. The top graph illustrates a 20-year borrowing/spending spree resulting in a zero savings rate. The bottom graph of disposable personal income shows mortgage debt growing from 68% to 100.8% in the last 20 years. Borrowing doesn't seem to pose a problem for anyone these days. In reality, this debt is a house of cards waiting to crumble. Consumption Outweighs Savings The enormous expansion of credit over the last five years has led people to over-invest and invest badly. It has encouraged financial speculation and over- consumption. The result has been the accumulation of a mountain of debt by consumers and corporations. In the process, today’s credit excesses have caused a hyperinflation of asset values as we have seen in inflated stock and real estate prices. Today, credit stands at ten times the available savings of the nation. It now takes five dollars of debt to create one dollar of economic growth. The Wall Street Journal recently featured an article on the nation's debt binge. U.S. corporate debt has grown by 67% over the last five years to a record $4.5 trillion. Household borrowing has risen almost as much rising 60% to another record of $6.5 trillion. What is even worse is that most of this debt is being accumulated by those least able to afford it. The riskiest borrowers are piling on the most amount of debt. We are seeing low-income consumers with bad credit histories and fledgling corporations using junk bond financing receive easy money. Here is a link to read the rest. Don't worry it condemns both Clinton and Bush economics financialsense.com

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next