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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (138856)	10/15/2013 1:39:32 PM
From: tejek	Read Replies (1) \| Respond to of 149317

GOP antics may lead to a 'de-Americanized world' By Steve Benen - Tue Oct 15, 2013 11:34 AM EDT Associated Press When there's a global economic crisis, investors from around the world have spent the last several generations doing one thing: they buy U.S. treasuries. The reasoning, of course, is that there is no safer investment, anywhere on the planet, than the United States of America -- which has the strongest and largest economy on the planet, and which always pays its bills. All of these assumptions, of course, were cultivated over generations, and pre-date the radicalization of the Republican Party. But what happens when U.S. treasuries are no longer considered safe, Americans can no longer be counted on to pay its bills, and the nation's most powerful economy chooses to default on purpose? The world starts reevaluating old assumptions, that's what. In Britain, Jon Cunliffe, who will become deputy governor of the Bank of England next month, told members of Parliament that banks should be developing contingency plans to deal with an American default if one happens. And Chinese leaders called on a "befuddled world to start considering building a de-Americanized world." In a commentary on Sunday, the state-run Chinese news agency Xinhua blamed "cyclical stagnation in Washington" for leaving the dollar-based assets of many nations in jeopardy. It said the "international community is highly agonized." I know I've been pushing this thesis in recent weeks, but it's important to remember the unique role the United States plays in global leadership and the extent to which Republican antics in Congress will change the dynamic that's been stable for the better part of the last century. No major western power has defaulted since Hitler's Germany, so this week may add some history to the potentially catastrophic economic consequences, and the world is watching closely. Indeed, try to imagine explaining this ongoing crisis to a foreign observer who doesn't fully appreciate the nuances of domestic politics. "Yes, we have the largest economy on the planet. Yes, we want to maintain global credibility. Yes, the process of extending our borrowing authority is incredibly easy and could be completed in about 10 minutes. No, some members of our legislative branch have decided they no longer want the United States to honor its obligations and pay for the things they've already bought." I suspect global observers would find this truly inexplicable. As it happens, I'd agree with them. Ezra Klein added yesterday that to the rest of the world, " the United States looks insane right now." They're dealing with real problems that their political systems are struggling to solve. The United States' political system is creating fake problems that it may choose to leave unsolved. "The United States was the one bright spot in the world recovery," says OECD Secretary General Angel Gurria. "It was leading the recovery! Leading the creation of jobs! This unfortunate situation with the budget and debt happens at the moment it was looking good." [...] At best, the United States is slowing its recovery -- and that of the rest of the world. At worst, it's going to trigger another global crisis.That's why, Gurria says, his concern isn't that the United States' economy is weak, but that its political system is. It's heartbreaking that so much of the world is now laughing at us, not because we have crises we can't solve, but because members of one party -- the one that lost the most recent national elections -- insist on manufacturing new crises to advance their unpopular agenda. To reiterate what we discussed last week, there's a global competition underway for power and influence in the 21st century. Americans have rivals who are playing for keeps. We can either be at the top of our game or we can watch others catch up. And it's against this backdrop that House Speaker John Boehner and his Republican colleagues shut down the government, threaten default, fight tooth and nail to strip Americans of their health care benefits, and keep spending levels so low we're kicking children out of Head Start centers while our global competitors invest heavily in education. It's as if some have a vision in which we no longer lead and we aim for second place on purpose. Great nations can't function the way we're struggling to function now. The United States can either be a 21st-century superpower or it can tolerate Republicans abandoning the governing process and subjecting Americans to a series of self-imposed extortion crises. It cannot do both. China is talking about "a de-Americanized world." It's time for Republicans to decide whether they intend to help them.

To: RetiredNow who wrote (138856)	10/15/2013 1:46:45 PM
From: tejek	Respond to of 149317

Many bubbles are independent of the Fed. But most of the bubbles in the years since the Fed was created were caused by the Fed itself. Think about it. When you manipulate the price of money and credit, by definition you are creating distortions that will correct in the future. Since no one can predict the future, Fed manipulations oftentimes cause bubbles. Then they have the temerity to suggest they are the solution to the volatility they themselves created. The crash of 2001 was caused by the easy money decade of Alan Greenspan. The Internet Bubble was another proximate cause. Those combined created a massively huge bubble. The housing bubble of 2006-7 was purely a Fed created bubble. When private industry blew up, they assumed the bad debts of the housing debacle. Now we have a Fed induced sovereign credit bubble, which most assuredly will also blow up. The Fed may have enabled the last housing bubble but it did not cause it. Capitalistic greed and an indifferent presidential administration caused the bubble. How? We have some of the greediest capitalists in the world. Are their worse capitalists? Of course. But American capitalists rank right up there. They took advantage of a president and his cohorts who don't believe that gov't can be effective and played fast and hard with real estate in this country. Eventually, the whole real estate industry became corrupted as did their banking and wall street counterparts. Crap was done that even in 90s LA few pulled. It became the norm under Bush not the exception. So don't talk to me about the Fed. You capitalist diehards best start looking at the system you cheer lead with such vigor. There has to be a better system then we have right now. There are way too many flaws in this one.........bubbles and busts is just one of them.