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Politics : GOPwinger Lies/Distortions/Omissions/Perversions of Truth -- Ignore unavailable to you. Want to Upgrade?

To: Kevin Rose who wrote (138584)	9/25/2008 3:23:15 PM
From: Lizzie Tudor	Read Replies (2) \| Respond to of 173976

well, if you want my opinion, low interest rates didn't cause this. What these Mortgage backed securities are, is basically derivatives again, and it seems to me derivatives eventually collapse in almost all cases- LCTM, societe generale etc. After the dot com bubble, the great bull market and the bush spending spree, the markets entered a secular bear for the first time in 30 years. Had Bush not spent like a drunken sailor to crash our dollar, we might have just had a correction and recovered in the markets, instead a number of factors but mostly bad fiscal mgmt from our government pushed us into a secular bear. That meant wall street needed to contract by 50% or more because with no bull market, no wall street business. There haven't been any IPOs or anything. Instead the industry jumped on these MBSs which are basically derivatives to save themselves. As the bubble inflated, the Bush admin who were concerned about reelection let it go on, because we stopped being able to create jobs at the same time this was occurring. So my belief is that whatever interest rates were, these derivatives would have still been created. Low rates just added fuel to the fire. Now the firms on WS are collapsing like they should have done in 2002. There have been ZERO venture backed IPOs this year.

To: Kevin Rose who wrote (138584)	9/25/2008 3:33:01 PM
From: TigerPaw	Respond to of 173976

figured out how to game the system Actually, the gaming of the system has been known for quite awhile. Karl Marx in Das Kapital made a big distinction between money earned on an investment of one's own money, and money earned on borrowed money (he called it passive income). The gaming is all a matter of who is allowed to borrow, and when, and what for. Supposedly everyone plays by the same rules, but the rules for borrowing are idiosyncratic. TP

To: Kevin Rose who wrote (138584)	9/25/2008 3:48:32 PM
From: Lizzie Tudor	Read Replies (1) \| Respond to of 173976

For almost the entire Bush years, they masked the weakness of the economy - manufacturing and tech job losses overseas, the shift of jobs to the service sector, decreasing wage power of the average worker - with statistics and monetary manipulation. BTW I totally agree on this, the US economy has not been able to create 150K jobs per month consistently for this entire decade. This should be a serious problem for legislators and economists and they haven't even addressed it like it doesn't exist. A few weeks ago before the current crisis some economist was speculating that 09 would be a good jobs year and the article was "JOBS boom predicted, 900K jobs in 09", well- that means this guy is predicting 75K jobs per month or HALF of what is required just to keep up with population growth.