Posted by Dinah on October 6, 2008, at 10:03:33
In reply to Re: Oops-- there goes the economy... » Deneb, posted by Sigismund on October 6, 2008, at 0:55:40
> ...and because some of them are too big to be allowed to fail the government will assume some of the debt.
Do you mean too big in terms of the global economy or too big in terms of influential people. If you mean the former, I'd agree. The fact that both presidential candidates voted for it even in the face of voter disapproval, when finding a way to differentiate themselves while ingratiating themselves with an angry public would be to their benefit, shows that this really had to be done. It was like creating the FDIC after the crash of '29. Some people still complain about that, but since panic can cause a disaster as well as be a reaction to it, it was a prudent move overall.
> But this isn't the end of it. It should have some way to go.
Absolutely.
> Actually, the 700B is going to be borrowed from the oil producing countries and the Chinese, isn't it, and will be a debt owed to them.
Whenever the government spends more than it owns, debt is created. The same sort of leverage that teeter totters individuals does the same for a government. We need to raise taxes or reduce spending or both to pay for this. And more importantly we need to make sure it doesn't happen again, reregulate, and keep an eye on future problems. Politicians need to think past the next election and become statesmen.
Some congressmen this time impressed me no end by saying that voting for the bill would be disastrous for them politically, but the disaster would be theirs, not the nation's. I'd like to invite those people to run here, because all too often politicians are driven by their own disasters.
> So it could affect how the world sees the US dollar as a reserve currency.
It should. If we want to be respected as a stable economy, we need to behave responsibly and prudently while not stifling genuine growth and productivity.
> That's the best I can do. I know nothing about economics either.I don't think many do. Myself included. I'd understand more if Daddy were around. It was a hobby of his, looking at the big picture. Everything I know, I learned from him.
poster:Dinah
thread:854180
URL: http://www.dr-bob.org/babble/poli/20081002/msgs/856008.html