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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Road Walker who wrote (366326)	1/10/2008 4:36:18 PM
From: tejek	Read Replies (1) \| Respond to of 1576012

Well, Chris, its easy for you to make that statement.......your ass, job, house etc isn't on the line. "Taking their medicine" means many thousands of people lose their jobs while others lose their homes. I hardly think your tough love approach is the best way to go It's going to have to happen sometime Ted... and the more times you stimulate the economy with more debt the worse the payback is going to be. Recessions are as natural as booms. And you can't have one without the other. Just as there is good and bad cholesterol, I think there is good and bad debt. Unsecured debt is bad; debt secured by income producing collateral is good. Currently unsecured debt is growing significantly thanks to the subprime crisis. Meanwhile, the credit markets have froze up and banks have all but stopped lending. The combination is creating a deflationary spiral that will only make matters worse. Here in Seattle and other cities where the economy is good, the result doesn't make sense.......we are starting to feel pain due to non economic forces. Lowering the fed rates won't cost anything...the only risk and its a big one, is inflation and it will have to be watched closely. Of course that's a moot point if we are in a recession......already producers have cut back their inventories because they are worried about the future, meaning demand for commodities has lessened. As for the subprime crisis, its an economic problem now but it didn't start that way. And while its convenient to blame Greenspan, providing liquidity did not create subprime loans....unscrupulous lenders and loan packagers did. What needs to be done is to make it illegal to create subprime loans; not throw the country into recession. Where there will be pain is in housing markets that are overbuilt....like Miami, like Phoenix, like Las Vegas etc. There is nothing that can be done. They will have to grow out of their housing overhang. And for some, it may take years. Finally, I don't understand why we have to go into a recession. Booms and busts are not "natural"; they are man made. There isn't a sin we need to pay for by experiencing a recession. A small group of dishonest people created the subprime problem. I think we are smart enough to find a creative way to get out of it without going through the horrific pain of a recession. Recessions do not have to be like the rain; they don't have to occur on a regular basis. The Clinton era proved that thesis wrong. Please tell me where you disagree or think I am wrong.