Will America Survive The Next Economic Collapse?

[Thordaddy]

I'm not trying to make this about me. It is about the complete failure of governments and banks roll.

If a homeowner owes 400 on a house that has plummeted to 200 do to the mortgage industries failures, the bank is going to ultimately take a 200 hit if forclosed. If a principal reduction to 300 benefits the homeowner and shortens the banks losses why did they wait so long before making such concessions?
Here in so cal, we were hit hard by the housing plummets. Even after the banks were bailed out, they refused to lend to just about anyone.

I'm not talking about gov handouts here. I think the banks and the auto industries should have been left to fail.
The auto industry could have regrouped on their own, without the uaw. Ford didn't take a handout.

I own ALL Fords,and OBTW look at the shit GM is in now, the overprotected never grow up do they?

 

[Dodgersrf]

Let's get back to rams, sport, girls and comedy.

 

[Dodgersrf]

I own ALL Fords,and OBTW look at the crap GM is in now, the overprotected never grow up do they?

As do I.

 

[Greg Stone]

I think the banks and the auto industries should have been left to fail.
The auto industry could have regrouped on their own, without the uaw. Ford didn't take a handout.

Since I have experience with bankruptcies and the auto industry it did not surprise me that Ford supported the GM "bail out". Ford and GM use many of the same subcontractors and a GM liquidation would have taken most of the supply chain into liquidation which in turn would have put Ford out of business. Ordinarily GM (or its suppliers if GM liquidated) would have gotten financing for chapter 11 reorganization but the financial crisis meant that there was no bankruptcy financing available. The one thing that surprised me is that when GM presented their bankruptcy plan Obama said "no" and told them they had to cut more expenses before the US would act as bankruptcy financier. Since then GM reclaimed it's place as the #1 world auto maker, paid back every penny with interest and is enjoying soaring stock prices during the current "disaster".

I salute you doom and gloomers for taking on government actions that actually made a profit for the government and were agreed on by BOTH the Bush and Obama administrations. You've admitted you'd rather have failed banks and auto industry and many millions more out of work -- WHY? Why this allegiance to destroying the country for "it's own good"?

 

[Ramhusker]

Since I have experience with bankruptcies and the auto industry it did not surprise me that Ford supported the GM "bail out". Ford and GM use many of the same subcontractors and a GM liquidation would have taken most of the supply chain into liquidation which in turn would have put Ford out of business. Ordinarily GM (or its suppliers if GM liquidated) would have gotten financing for chapter 11 reorganization but the financial crisis meant that there was no bankruptcy financing available. The one thing that surprised me is that when GM presented their bankruptcy plan Obama said "no" and told them they had to cut more expenses before the US would act as bankruptcy financier. Since then GM reclaimed it's place as the #1 world auto maker, paid back every penny with interest and is enjoying soaring stock prices during the current "disaster".

I salute you doom and gloomers for taking on government actions that actually made a profit for the government and were agreed on by BOTH the Bush and Obama administrations. You've admitted you'd rather have failed banks and auto industry and many millions more out of work -- WHY? Why this allegiance to destroying the country for "it's own good"?

Wait, profit and government in the same sentence? Wouldn't that be considered an oxymoron? Never heard of that before today.

 

[Greg Stone]

Wait, profit and government in the same sentence? Wouldn't that be considered an oxymoron? Never heard of that before today.

Doesn't happen often, but since the government was standing in for the non-functioning banks they acted as a bank and received all their money back plus interest on loans and appreciated value on the GM stock they sold. I'm frankly astonished that anyone thinks this was a bad thing.

 

[Dodgersrf]

Doesn't happen often, but since the government was standing in for the non-functioning banks they acted as a bank and received all their money back plus interest on loans and appreciated value on the GM stock they sold. I'm frankly astonished that anyone thinks this was a bad thing.

As long as the uaw is turning their screws, it's a bad thing.

 

[Thordaddy]

Since I have experience with bankruptcies and the auto industry it did not surprise me that Ford supported the GM "bail out". Ford and GM use many of the same subcontractors and a GM liquidation would have taken most of the supply chain into liquidation which in turn would have put Ford out of business. Ordinarily GM (or its suppliers if GM liquidated) would have gotten financing for chapter 11 reorganization but the financial crisis meant that there was no bankruptcy financing available. The one thing that surprised me is that when GM presented their bankruptcy plan Obama said "no" and told them they had to cut more expenses before the US would act as bankruptcy financier. Since then GM reclaimed it's place as the #1 world auto maker, paid back every penny with interest and is enjoying soaring stock prices during the current "disaster".

I salute you doom and gloomers for taking on government actions that actually made a profit for the government and were agreed on by BOTH the Bush and Obama administrations. You've admitted you'd rather have failed banks and auto industry and many millions more out of work -- WHY? Why this allegiance to destroying the country for "it's own good"?

First of all, you take some serious license when you say Ford would have failed, no way to know that.
Second one of the reasons there is no political forum here is because people like to label others who don't agree with them AND put words in their mouth in their zeal to win a thread.
Calling people "doom and gloomers" is dismissive ,makes no point in an argument ,and only contributes to the food fight ambiance like seen on those sort of cable TV shows.
I would RATHER we had not gone into the practices that produced the "bubble" and am certain we can't continue bailing investment bankers and companies that are "too big to fail" only to make them bigger and more of a liability.
As far as the supply chain that would have gone into liquidation, there's nothing that says Ford couldn't have bought them possibly by JUST underwriting their debt.

 

[Prime Time]

not even going to comment on this, except for what happened to the "no political discussions here"

I get your point. It's a slippery slope. Politics can sneak into almost any internet conversation these days on most any topic. So far the discussion has been handled well. We'll see how it goes. Thanks for your post.

 

[Greg Stone]

First of all, you take some serious license when you say Ford would have failed, no way to know that.
Second one of the reasons there is no political forum here is because people like to label others who don't agree with them AND put words in their mouth in their zeal to win a thread.
Calling people "doom and gloomers" is dismissive ,makes no point in an argument ,and only contributes to the food fight ambiance like seen on those sort of cable TV shows.
I would RATHER we had not gone into the practices that produced the "bubble" and am certain we can't continue bailing investment bankers and companies that are "too big to fail" only to make them bigger and more of a liability.
As far as the supply chain that would have gone into liquidation, there's nothing that says Ford couldn't have bought them possibly by JUST underwriting their debt.

Well, Ford promoting the GM bailout seems like pretty good evidence to me when added to all the reporting within the automotive industry. My company did about 25% of its sales with the automotive industry and I was intently following the situation. The supply chain would definitely have gone down and without available financing I don't see how Ford could have saved it, but let me clarify that this is my opinion, shared by most economists and auto industry experts at the time.

Given that this thread is specifically about "THE END" I don't think "doom and gloomers" is too strong but I do admit that there is a little mockery therein. It has always amused me that despite millennia of insistence that the end is nigh the current generation is always sure of its own prophecies of apocalypse and sees no comparison to the failed prophesies that went before.

I certainly agree that allowing the finance industry to move it's chips from investments to arbitrage and pyramid schemes was bad public policy and I also agree that the government bailing out businesses is usually a bad idea. You don't have to be an economics fanboy, like I am, to recognize the stark fear in everyone's face when the Bush administration first floated giving the banks a trillion dollars. This was an unusual circumstance and merited an unusual government response. Government has a bad habit of making the unusual necessity into everyday pork but I don't see that happening in this case.

 

[Ramhusker]

And now it seems our neighbors to the south are waging economic war on our country and our government doesn't seem to care or worse is complicit in the endeavor.

 

[Thordaddy]

Well, Ford promoting the GM bailout seems like pretty good evidence to me when added to all the reporting within the automotive industry. My company did about 25% of its sales with the automotive industry and I was intently following the situation. The supply chain would definitely have gone down and without available financing I don't see how Ford could have saved it, but let me clarify that this is my opinion, shared by most economists and auto industry experts at the time.

Given that this thread is specifically about "THE END" I don't think "doom and gloomers" is too strong but I do admit that there is a little mockery therein. It has always amused me that despite millennia of insistence that the end is nigh the current generation is always sure of its own prophecies of apocalypse and sees no comparison to the failed prophesies that went before.

I certainly agree that allowing the finance industry to move it's chips from investments to arbitrage and pyramid schemes was bad public policy and I also agree that the government bailing out businesses is usually a bad idea. You don't have to be an economics fanboy, like I am, to recognize the stark fear in everyone's face when the Bush administration first floated giving the banks a trillion dollars. This was an unusual circumstance and merited an unusual government response. Government has a bad habit of making the unusual necessity into everyday pork but I don't see that happening in this case.

And I think that there isn't only mockery there is also hubris.

All the great empires of the world have come to an end ,that "historical perspective" is far more dependable than examples where we've dodged the bullet ,we are a scant 240 years old here and we already have incurred a debt that will never be able to be paid without monetizing it or practicing near genocide on senior citizens.

As far as current generations go ,I agree each generation suffers from one of man kinds greatest faults CIA (contemporary intellectual arrogance) and it resides on both sides of this argument ,but the fact that a poor weather man predicts rain every day and it doesn't rain ,doesn't MEAN it's never going to rain,that's a fallacy in your argument.
I used to be able to do 10 sets of pushups of 100 each in an hour, I can't do 50 now.

Lemme ask you ,we built an Interstate Highway System ,think we could do it again? I don't ,I think we are tied to too many unproductive federal programs to accomplish another capital project like that. IMO another economic collapse the scope of the great depression would irrevocably change the nature of our government so drastically I can't see how the constitution would have any relevance left to it.
So again the land mass and the name could survive but it would be so different than what it was conceived to be that nostalgia for the concepts would be all we had left.

 

[Greg Stone]

Hubris? Perhaps I'm as guilty as those I accuse, but you have consistently missed my first and repeated point that today's situation, while very serious, isn't as great as many the nation has successfully faced in the past. I'm basing my view on the facts on the ground illuminated by historical comparison.

I agree that the US has no assurance that it will endure for any particular period of time, modern democracy is too new an experiment and 240 years means little on an historical scale. Like Churchill I believe that Democracy is the worst system of government ever devised by man - - - except for all the others. As messy as it is I'm bullish on democracy and the free market and don't see these innovations fading soon. Still, we are only one large meteor srike or nuclear weapons exchange from disaster so nothing is "for sure".

Sure we could build the interstate highway system again. All we'd have to do is cut the defense budget in half and we could do it with money and resources to spare.

The great depression was world-wide and led Hitler and many other dictators to new or increased power. It does open the door to all sorts of instability. I do think FDR could have become a dictator if he was so inclined and some future leader may take advantage of a frightened public to do so. I just don't see it as likely. Structural elements to support a growing economy are on the increase, the tide of manufacturing flowing back to the US being a key one. The US has incredible assets.

 

[bluecoconuts]

I agree it would be hard to get another interstate highway system here, but I don't think it's due to federal programs, but rather due to politics. Look at rail systems across the globe, there's a reason why the US doesn't implement one (and they could link every major city with high speed rail) and it's primarily because of political pressure to either move the rail to unnecessary areas to pass through districts or not do it at all to help reduce stress on the auto industry. That's what is more likely to "end" our empire. Not a fast collapse that sends everything to shit, but rather a slow fizzle because we hold ourselves back from fear/political fighting and get left behind.

 

[Thordaddy]

Hubris? Perhaps I'm as guilty as those I accuse, but you have consistently missed my first and repeated point that today's situation, while very serious, isn't as great as many the nation has successfully faced in the past. I'm basing my view on the facts on the ground illuminated by historical comparison.

I agree that the US has no assurance that it will endure for any particular period of time, modern democracy is too new an experiment and 240 years means little on an historical scale. Like Churchill I believe that Democracy is the worst system of government ever devised by man - - - except for all the others. As messy as it is I'm bullish on democracy and the free market and don't see these innovations fading soon. Still, we are only one large meteor srike or nuclear weapons exchange from disaster so nothing is "for sure".

Sure we could build the interstate highway system again. All we'd have to do is cut the defense budget in half and we could do it with money and resources to spare.

The great depression was world-wide and led Hitler and many other dictators to new or increased power. It does open the door to all sorts of instability. I do think FDR could have become a dictator if he was so inclined and some future leader may take advantage of a frightened public to do so. I just don't see it as likely. Structural elements to support a growing economy are on the increase, the tide of manufacturing flowing back to the US being a key one. The US has incredible assets.

NO NO, your point was in response to the OP question as to whether we would survive the NEXT COLLAPSE, what we are experiencing now is a reversal not a collapse,kinda moving the goalposts on me there.

BTW we aren't a Democracy, and I really get itchy having to keep telling people that.

They were financed as defense in the first place


So the manufacturing is going to follow the labor force

 

[Dodgersrf]

NO NO, your point was in response to the OP question as to whether we would survive the NEXT COLLAPSE, what we are experiencing now is a reversal not a collapse,kinda moving the goalposts on me there.

BTW we aren't a Democracy, and I really get itchy having to keep telling people that.

They were financed as defense in the first place

So the manufacturing is going to follow the labor force

We are a Republic.

 

[Greg Stone]

Really? When Churchill speaks of democracy he is using it in the broad sense, as was I. Republics are one form of democracy as are constitutional republics.

 

[Thordaddy]

OH YEAH blame it onn Churchill,who was basically demogoging,for people he knew didn't know the difference between the two, which is profound.

I guess then the rest of my post you concede since that's the one part you responded to.

 

[Greg Stone]

First then, the OP states that the next "economic collapse" will be irreversible. He and other posters have stated that it will be irreversible due to current conditions. Therefore I am writing about current conditions. I believe there will be another recession but I don't believe ti will be irreversible.

For Thordaddy and others who have never studied political science I'll cover some basics. "Democracy" is a Greek word which means "rule by the people" as opposed to "autocracy" which is "rule by a single person". Since Athenian democracy was an innovation the word is used in the general sense for any government whose authority resides in the people's votes and in the specific sense for governments elected directly by the people in which some laws and appointments are also made directly by the people, as was the case in Athens.

When you read the writings of the founding fathers you will find that, like most Englishmen, they were obsessed by the Roman Empire and the democratic model they most often refer to when discussing the future US government is the Roman Republic. In specific terms the US started out more as a republic and has steadily become more of a democracy. Now, for example, we have direct elections for US senators and presidents and there has been a trend towards the people directly enacting and even proposing laws through initiatives. Because of technological advances it is even possible for the people of the US to meet en mass as the Athenians did rather than rely on elected representatives so there is plenty of room for the trend to continue.

 

[Thordaddy]

First then, the OP states that the next "economic collapse" will be irreversible. He and other posters have stated that it will be irreversible due to current conditions. Therefore I am writing about current conditions. I believe there will be another recession but I don't believe ti will be irreversible.

For Thordaddy and others who have never studied political science I'll cover some basics. "Democracy" is a Greek word which means "rule by the people" as opposed to "autocracy" which is "rule by a single person". Since Athenian democracy was an innovation the word is used in the general sense for any government whose authority resides in the people's votes and in the specific sense for governments elected directly by the people in which some laws and appointments are also made directly by the people, as was the case in Athens.

When you read the writings of the founding fathers you will find that, like most Englishmen, they were obsessed by the Roman Empire and the democratic model they most often refer to when discussing the future US government is the Roman Republic. In specific terms the US started out more as a republic and has steadily become more of a democracy. Now, for example, we have direct elections for US senators and presidents and there has been a trend towards the people directly enacting and even proposing laws through initiatives. Because of technological advances it is even possible for the people of the US to meet en mass as the Athenians did rather than rely on elected representatives so there is plenty of room for the trend to continue.

So now we come to the part of the thread where you make straw man assumptions in order to be condescending?
Again the OP ASKS,then states his opinion,which is every bit as valid as yours but as yet I haven't seen him call you any names nor in any way question your knowledge nor educational background

From one of his posts " This next time, may be the last time".
Seems you have been more absolute.

Your new here and for the second time I'd like to caution you, condescending and name calling gets these threads locked around here, so tend to your arguments and less to your adversary and whatever you imagine him or her to be versed in, their emotional state to be etc.

I have marveled over the years at the resiliency of the free market and capitalism, the burdens put on it by those who take it's success for granted has left Americans largely unaware of what it is that makes this country successful, but I am not nor will I ever be one who takes that success for granted ,you can kill the goose and we're approaching a point where the producers "shrug" and read the economic future being most secure in servicing the unproductive (probably the real leading growth industry) all the while we are doing precious little to prevent a competing army of workers and a nearly equal sized army of dependents into a country where the ethnic group our President claims to be OF is languishing at depression level unemployment rates.
NOW would be a horrible time to test your theories on unprecedented conditions.
Once again I challenge YOUR claims of historical perspective BECAUSE there is no comparable history to compare it to,so now that I've said it at least three times don't come back and say I haven't addressed it. or I might conclude you aren't reading.