Sign in to follow this  
Followers 0
Skitter

If Capitalism

Rate this topic

44 posts in this topic

is a cornerstone of what the Right thinks is America why do they not want the bailouts to help the banks and Wall St. which seem like conerstones for capitalism?

Share this post


Link to post
Share on other sites

Because true capitalism is very darwinian in principle. Survival of the fittest. The markets determine and weed out those which are weak and inefficient. If a bank gets itself in trouble from reckless lending and poor policy, then let it fail and let more efficient banks take its place.

 

But of course, there is no true capitalism. All government impinge to one degree or another on the market. It is the amount of interferance a government makes in the marketplace which causes so many problems. This economic crisis began with the Dem's pushing the banks to make low interest loans to the poor to help them purchase and own houses. The banks reacted by both burying their losses (packaging them) and by granting these loans to "less risky" customers to cover the losses.

 

BTW, nobody is in "love" with the system of capitalism. But it is the most free and efficient of all the systems for the individual. With socialism, the government in the end must force people to do things and act in certain ways or socialism will fall of its own weight. Hope I am being clear.

Share this post


Link to post
Share on other sites
View Postbailouts are socialism for wall st.

 

if we really embraced capitalism, we'd let bad ideas fail.

 

Exactly. In order to clean up the "toxic assets" on the banking books without allowing them to fail we have to do one of two things:

 

1. Nationalize the banks (in one fell swoop, most likely over a weekend) then re-privatize.

2. Buy those assets at a premium, which would put the Gubmint in the position of owning the banks.

 

Neither of the above scenarios are "Capitalism" in the pure sense. Right now O&Co is charting a middle course by doing a little of both, with no good effect.

Share this post


Link to post
Share on other sites

"if we really embraced capitalism, we'd let bad ideas fail."

 

What happens when everyone in an industry makes the same bad decision? Before the housing bubble and all the bad decisions that went into it's making most of these company's were productive...... I just don't see how you basically let the whole industry fail. It would erase almost everything done in the last 50 years. Which could be good down the road but damn I really don't want to spend the best years of my life in great depression number 2...... Maybe thats selfishbeatin.gif

 

John

Share this post


Link to post
Share on other sites
View PostBecause true capitalism is very darwinian in principle. Survival of the fittest. The markets determine and weed out those which are weak and inefficient. If a bank gets itself in trouble from reckless lending and poor policy, then let it fail and let more efficient banks take its place.

 

But of course, there is no true capitalism. All government impinge to one degree or another on the market. It is the amount of interferance a government makes in the marketplace which causes so many problems. This economic crisis began with the Dem's pushing the banks to make low interest loans to the poor to help them purchase and own houses. The banks reacted by both burying their losses (packaging them) and by granting these loans to "less risky" customers to cover the losses.

 

BTW, nobody is in "love" with the system of capitalism. But it is the most free and efficient of all the systems for the individual. With socialism, the government in the end must force people to do things and act in certain ways or socialism will fall of its own weight. Hope I am being clear.

 

 

I like the Darwinism approach myself,even at my own loss, but what happens if the the condition of major banks and Wall st. are in the toilet?

 

This would negatively effect Capitalism, would`nt it?

Share this post


Link to post
Share on other sites
View Post"if we really embraced capitalism, we'd let bad ideas fail."

 

What happens when everyone in an industry makes the same bad decision? Before the housing bubble and all the bad decisions that went into it's making most of these company's were productive...... I just don't see how you basically let the whole industry fail. It would erase almost everything done in the last 50 years. Which could be good down the road but damn I really don't want to spend the best years of my life in great depression number 2...... Maybe thats selfishbeatin.gif

 

John

 

It wouldn't erase everything. There would still be people out there who know what the banks did right and what the banks did wrong.

Share this post


Link to post
Share on other sites

Eddy, I believe it would basically erase everything..... There might be people who know how to run a bank right, but there wouldn't be any need for their service.

 

The chain reaction would mean GD2. Ask all these people who say we should let these guys fail what is the end result and most avoid the answer because they just want to go by principle or they actually want everything to breakdown and that would be UnAmerican.

 

If these guys fail we all fail. GD2 for sure, and I am not talking a great depression like you hear people say we're already in. I mean the real deal. At least if not more than half the country out of work. Empty street/roads. Massive closing. Almost every store you count on buying food from would be gone. The whole system breaking down....... It would be the SHTF scenario you hear guys buying up guns and preserved food talking about.

 

Maybe that's crazy but it certainly is not the craziest thing I've seen around here as of late.... I'd rather bailout these guys than have to build a fortress, stock it with guns and food, and pray for my safety ever day/night.

 

John

Share this post


Link to post
Share on other sites
View PostI like the Darwinism approach myself,even at my own loss, but what happens if the the condition of major banks and Wall st. are in the toilet?

 

This would negatively effect Capitalism, would`nt it?

 

 

 

No. From what I understand (and I may be wrong here) most banks are sound and operating normally. It is the large banks which bought up most of the toxic asset packages. Theoretically, if they go down, other banks will step into the breach. Nature abhors a vacuum and all that.

 

Part of the theory is that we would experience some jarring pain for a short period whereas, the way we are doing it now, the pain will be spread out over time and the crises will continue.

Share this post


Link to post
Share on other sites
View PostEddy, I believe it would basically erase everything..... There might be people who know how to run a bank right, but there wouldn't be any need for their service.

 

The chain reaction would mean GD2. Ask all these people who say we should let these guys fail what is the end result and most avoid the answer because they just want to go by principle or they actually want everything to breakdown and that would be UnAmerican.

 

If these guys fail we all fail. GD2 for sure, and I am not talking a great depression like you hear people say we're already in. I mean the real deal. At least if not more than half the country out of work. Empty street/roads. Massive closing. Almost every store you count on buying food from would be gone. The whole system breaking down....... It would be the SHTF scenario you hear guys buying up guns and preserved food talking about.

 

Maybe that's crazy but it certainly is not the craziest thing I've seen around here as of late.... I'd rather bailout these guys than have to build a fortress, stock it with guns and food, and pray for my safety ever day/night.

 

John

 

 

 

Spaniard, see what I just said.wink.gif

Share this post


Link to post
Share on other sites

Top 20 banks or so have 90 pct of our deposits. FDIC would be overwhelmed, nobody would get a dime out of them. That would be catastrophic in my book. Don't forget, as bad as it is we still have 90 pct gainfully employed.

Share this post


Link to post
Share on other sites

"Top 20 banks or so have 90 pct of our deposits. FDIC would be overwhelmed, nobody would get a dime out of them. That would be catastrophic in my book. Don't forget, as bad as it is we still have 90 pct gainfully employed."

 

Bingo... If the largest fail we're screwed. There goes the wealth of the entire middle class. If any are to be allowed to fail it's the small ones.(Not fair but this is what happens when you allow these banks to get this big) Believe it or not most of the smaller banks have had massive loss's too because they were investing into the larger guys.

 

John

Share this post


Link to post
Share on other sites

Most people either can't see it or don't want to believe it but right as we speak the federal gov is protecting the wealth and assets of about 90% of the people in this country by bailing out these banks.

 

John

Share this post


Link to post
Share on other sites
View Post"if we really embraced capitalism, we'd let bad ideas fail."

 

 

What happens when everyone in an industry makes the same bad decision? Before the housing bubble and all the bad decisions that went into it's making most of these company's were productive...... I just don't see how you basically let the whole industry fail. It would erase almost everything done in the last 50 years. Which could be good down the road but damn I really don't want to spend the best years of my life in great depression number 2...... Maybe thats selfishbeatin.gif

 

 

John

 

Where has rewarding bad behavior worked?

 

 

The 'whole' Industry will not 'go down'. Even if it did, out of the 'rubble' would emerge a 'smarter' industry.

 

 

The continual rewarding of bad behavior give no incentive to change.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to register here in order to participate.

Create an account

Sign up for a new account in our community. It's easy!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now
Sign in to follow this  
Followers 0

  • Recently Browsing   0 members

    No registered users viewing this page.