US Debt Trip
Chuck Ponzi May 21st, 2009
Barry Ritholtz had this up, and it’s interesting how this country has become entranced by what appears to be becoming a cult of personality.
There is serious potential for federal crowding out of private enterprise. That was one of the reasons that the Great Depression lasted as long as it did. The federal stimulus was so unevenly applied that it distorted natural incentives.
Here’s another visualization of part of the problem (added later).
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That money is going to be spent on retaining jobs that should have never existed in the first place. We all know what would happen when we have large unemployed (maybe even dumb) population, chaos.
Seriously? You’re seriously going to post this crap? I had no idea you swerved this way, but better to know now so I can move on.
What does “swerved this way” mean? I’m confused.
Sorry to see you go.
Oh jeez…you just lost ‘mey’. Time to shutdown the blog…
Too bad I prepaid my hosting. Should have gone month-to-month.
Chuck
Those web hosts always get you with the old pre-paid deal…i’m still paying for a blog i never started.
Keep up the good work. Eventually, people will wake up. You’re our Churchill
Thanks, captain.
I think many of those commenting missed the point of the videos. They were made by an economist…
Regardless of what you feel about any president and their performance (I don’t have a personal opinion), when government spends that much of the GDP, there is a crowding out effect.
For example, look at current credit spreads. They are compressed, not because the economic storm has passed, but because the Federal Reserve strong-armed them. (ever wonder what credit spreads were like in the USSR? Think about that for a moment.)
Everybody talks about “putting a floor under housing”, but what if the natural floor is much lower than the current price? You’ve got to subsidize housing even more than ever before, which not surprisingly, diminishes faith in the free markets to determine housing’s real value. It’s a vicious cycle that only gets worse with more intervention.
Crowding out free enterprise in lending (instead of letting banks fail, but protecting depositors) creates all kinds of anti-consumer incentives. It’s a nightmare in the making. The fact remains; this “economic storm” was invented by those in charge to concentrate more power.
Chuck Ponzi
This stuff is drivel.
I’ll move along too.
why is it adjusted to inflation when it should be adjusted to GDP? The results would be similar but not as dramatic (i.e. more truthful)
That’s a good point.
I think I’ll send the maker an email to see if he’ll update it with GDP.
Why are so many people putting so much ‘hope’ in Obama? I am afraid they are going to be very disappointed over the next 4 years. And watch, they will probably be stupid enough to vote him in a 2nd term.
I would guess you are one of the ‘geniuses’ who would have preferred 4 more years of Bush’s ‘wildly successful’ policies?
Geez, the guy is just trying to pull us out of the horrible mess that eight years of Bush put us in. It’s like saying the co-pilot of a plane that’s headed for a mountain is an idiot for going against the [main] pilot and wanting to steer around it. Try listening to someone beside Limbaugh for a change (he is an entertainer by the way, a mere character designed to inflame you conservative types- i.e. whatever anger he can stir up looks good for his ratings and ultimately his pocketbook – iow, he plays you cons like a cheap violin)
which countries in the past borrowed and spent its way to prosperity?
yes, i’m quitting this blog too. I’m looking for a blog that tells me my house is going up 20% next year. It makes me feel warm on the inside even though outside I feel so cold. I know I shouldn’t have, but I deserve to be told that I’m glad I did. Where did everyone go?
Seriously, I doubt most people including congress can understand $1 billion dollars. Sure your budget is xxxx and you want to spend xx on your district, but do you grasp how ALL your country men were able to collectively skim off a few trillion before they paid themselves? I’d love to see a study of the human brain and its ability to quantify large amounts of money. Those videos blow my mind, but unfortunately I get the feeling it’s just another number to our leaders.
The video does quantify stupidity if you agree Bush 2 was an idiot. I don’t remember the exact amount, but numbers wise it says something to the effect that Obama is twice as dumb or something in that neighborhood? Is it mathematical proof of his intelligence? Figures never lie, but liars always figure. So go figure.
In any case, it wasn’t any branch of gov’t making anyone make horrible investment decisions. I did my own math at least 30 times to see if I could do what friends and family were doing and each time I came away scratching my head. As a newlywed in 2004 and having multiple realtor family tell you “now or never” is impressive, but figures never lie. Unfortunately, today and for the last 10 year we were stuck with liar figures.
Definitely right.
That money is going to be spent on retaining jobs that should have never existed in the first place. We all know what would happen when we have large unemployed (maybe even dumb) population, chaos.
Chuck,
Keep up the good work. I’ve been reading your
blog for awhile and these videos are right on target.