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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Katelew who wrote (129392)	1/27/2010 11:06:56 AM
From: Steve Lokness	Respond to of 542054

actually recessions serve to clean house....weed out the weak and redistribute assets to more efficient use. They spawn innovation, too, and often entirely new industries and technology come about from the crisis management that takes place Yup. well said. But it does make you sound like an Austrian believer you know.

To: Katelew who wrote (129392)	1/27/2010 12:06:01 PM
From: Cogito	Read Replies (1) \| Respond to of 542054

>>Another reason is that the government has no way of really knowing whether or not a company is well-managed or not when it tries to prop them all up. Strong companies tend to survive recessions on their own because they have prepared for the inevitable downturns. They have money set aside, or have hired well, or have solid inventory contol systems in place, etc. So to blame a business failure entirely on a recession is mistaken.<< When I speak of government action to prevent recessions becoming depressions, I am not speaking of rescuing specific companies. I don't think that's a good idea except in rare instances. You say you don't remember any government intervention in recessions, but it happens all the time. The Fed raises and lowers interest rates, and controls the money supply. When they lower rates to less than one percent, they are attempting to keep slowdowns from becoming recessions or depressions.