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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (87282)	12/20/2000 10:25:54 AM
From: Don Lloyd	Read Replies (1) \| Respond to of 132070

Ron - ...Possibly, but it certainly doesn't account for MU's problems, does it? The credit bubble had nothing to do with the inability of the marketplace to absorb large quantities of cheap high density DRAMS made possibly by exponential advanced in technology. That, I believe, is the primary problem right now... the rate of technological progress is rapidly exceeding the economy's ability to make use of those advances. To the extent this is true, it represents a transfer of wealth from the companies that invest in advanced technology to their customers as prices are driven lower by competition. The investment HAD to be made, but may NEVER result in profits. At the same time, the existing capital production base is being destroyed as it simply cannot produce profitable products either. Regards, Don

To: Hawkmoon who wrote (87282)	12/20/2000 12:39:06 PM
From: Skeeter Bug	Read Replies (1) \| Respond to of 132070

>>Btw, he did listen rather intently when I described the fact that every year we have a surplus, the US national debt increases. This is due to the fact that SSTF surpluses have to be parked in government debt, namely US T-Bills.<< this sounds like the mechanics of a shell game. first off, it doesn't make sense to me how extra money causes more debt. does this make sense to you? >>that means the politicians are spending it and increasing national debt in the process.<< ron, spent surplus ain't surplus. i could argue, using that "logic" that all tax payments are surplus, the govt just decided to spend it. silly. more shell game. i'll infer from what you said that increased business productivity does not mean increased economic productivity. think about this for a moment. it is an important point. >>Possibly, but it certainly doesn't account for MU's problems, does it? The credit bubble had nothing to do with the inability of the marketplace to absorb large quantities of cheap high density DRAMS made possibly by exponential advanced in technology.<< au contrare. micron has asserted, and rightfully so, imho, that the korean and japanese govts provided excessive credit to their respective dram mfrs, thus guaranteeing a glut in dram. take a look at some of the big players' balance sheets. their debt is STAGGERING! the us doesn't have a lock of credit bubbles. some asian countries led the way. look where it took them.

To: Hawkmoon who wrote (87282)	12/20/2000 12:46:47 PM
From: benwood	Read Replies (1) \| Respond to of 132070

Ron, the "surplus" was $237 billion, but surplus was $87 billion. What's the difference? The Treasury borrowed $150 billion from the SS Trust fund. Where does he (and Bush and everyone else who wants to refund that money) think the money to repay SS will come from later when payouts require that money to be available to SS? Answer, in case they don't have an inkling -- income tax! Maybe that's when a light will go on for some people that the money was actually borrowed from somewhere. wilmingtonstar.com Suppose in 2001, the US Treasury again ended up ahead $87 billion dollars, but that the SS Administration needed to fork over $300 billion more than this year. That is, they not only didn't run a surplus, but needed every extra cent they took in during 2000 as well. That extra $150 is in the SS Trust fund, of course, in the form of IOU's received from the US Treasury. So, the Treasury gladly pays them back after issuing $63 billion dollars of T-bills. So the way the government would report this, if they were consistent, is that 2000 had a surplus of $237 billion, and 2001 would have a deficit of $63 billion. But in each year, the US Treasury took ran the same surplus of $87 billion. In effect, what they are doing is shifting the burden for the SS payouts from now to the next generation via future income tax surcharges (or an acceleration of reported future deficits). And by depriving the SS Trust fund of interest (or the ability to invest), they are ensuring that the fund will go bust sooner. Why would they do this, when it seems contrary to all the talk of shoring up the SS Trust fund? Why, it lets politicians say we have a huge surplus to brag about (Clinton) or refund (Bush)! If there was a refund now, why not reduce the tax rate for SS? That would refund it to the very people who created the surplus. But you can't use trickle down hand waving and hand it to the wealthy if you do that... never mind! So in the last 30 years, only 3 years of surpluses, including SS Trust windfall. In the last 30 years, including about 8 straight years of boom, only 1 solitary year of true surplus. Does that sound alarming, or what? I think when boomers are retiring in droves, this situation will be horrific. Not only will there be a drag on the economy from the reduction in work force, but the necessity to issue debt to pay back the SS Trust fund at the same time could be overwhelming.