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[Kaleigh Doyle]

Well, I'm no economics major, but its pretty clear to me that most of the world was wholly unprepared for the consequences of a global economy and the kind of impact it would have when things go south..because things have been relatively stable since its inception. I think the only reason the United States is still shambling along now is because no one trusts China and everyone else (EU) is doing much worse, so people still see us as the shelter for their finances.

I can't speak for any other part of the world, but in the USA the dialogue for resolving the financial crisis has been pretty shitty from our representatives. We have the Republicans, who are against taxes and want to cut spending, and Democrats, who want to spend more money on building infrastructure to reinvigorate the economy.

Again, I'm just a layman, but neither of these positions are tenable to me. Tossing money into construction jobs and 'alternative' fuels feels futile and ultimately not much better than  just handing a fat wad of cash to the banks and saying, "here fix yourself up." It's just a patch, and doesn't really resolve some of the long-term issues we are facing. What are those long term problems? Staying competitive in the world economy (infrastructure, incentives), keeping our working population educated to where they can satisfy the economy's needs, and provide a stable platform for long-term investment.

Cutting spending, to me, is like cutting off a limb because you're stuck in quicksand- it might help you keep your head above ground, but you'll wish you had it when you find a vine to grab. This whole anti-government platform that the Tea Party and the Republicans have adopted (out of reluctant convenience) may have good intentions, but the kinds of cuts they are talking about are not exactly the kinds of cuts that are needed in a period of instability when workers aren't faring well financially. Yeah, great, lets run on a platform of killing social security and unemployment benefits when people need it most! Not to mention, the candidates they have running for office are idiots who run on socially regressive policies (Support our troops, unless they're gay. I'm pro-life, but give'em the death penalty! Poor? It's your fault, you didn't try hard enough!) that make me want to vomit.

So, I sit here and look at all these problems culminating at once around me, and then I look at the riots/protests going on across the country, and while I agree with some of the things said it feels to me like a lot of it is misplaced frustration with the entire problem. It's not post-WW2 anymore, and the US isn't the master of the global market any longer and we're just as much victims to tides and shifts as everyone else is. We have to have an effective education system in place to supply quality workers and have an infrastructure in place to entice corporations to want to move their businesses in our country. We have to provide them a valuable resource that is unique to an American- something that can't be replicated and reproduced for 95% less in India or some third world country. If we want to stay at the top of the food chain, we need to be competitive.

The whole 'taxation without representation' thing has been a central theme to the United States since its inception, and this is where I think these protests have actually hit the nail on the head. US politicians have been acting in the best interests of corporate institutions, their profit margins and portfolio growth, rather than the best interests of the American people. Most people probably wouldn't even give a shit either if it meant a majority of people were prosperous, but when there's a 20% unemployment rate and no hope for escape, it's easy to look at the BoA's and their 5$ transactions and blame the system for corporate greed. 

In our world, money is power, and corporations have lots of it, and its no surprise that politicians with lots of money can make their message heard to the masses and have an easier time getting elected. It's not hard to find the connection, but sometimes it can be a challenge to find out who pulls a puppet's purse strings. Even the founding fathers of our country had the idea to balance power because they know that any gathering of people with too much influence not left in check will corrupt the process. Unions were formed to counter-weight corporation's authority over its workers, but even today you see examples of where unions are just as corrupt as the corporations they sought to keep in place. Let's face it, it's human nature to take advantage when in a position of authority. The system requires vigilance on all sides and a well-informed populace to make that happen.

Like all things in this world, a balance needs to be achieved in order to reach some degree of harmony. One can recognize that while the presence of government regulations and taxes can stifle growth, there are many examples of their benefits to society, and I think its irresponsible to simply reply to a complex problem like this with a message of 'CUT SOCIAL PROGRAMS'. Whether this message is delivered out of gross ignorance or intentionally to galvanize a respective voting segment, pretending like such ideas are even feasible is irresponsible. On the other hand, blaming wall street for the problems of the world, when people are behaving as humans do (taking advantage when it is presented) is just as foolish. What institution failed to uphold the law and why has this been allowed to persist? Who allowed this to continue, and even bail out the reckless institutions that allowed this instability to exist?

I think the whole fucking system is to blame.

[Mizhara]

How are the EU doing worse, if I may ask? I have seen no articles or real life indications of this.

[Kaleigh Doyle]

There's been lots of talk about the stability of the EU and whether they will survive the insolvent governments going under or if there'll be a bailout. All that talk was going on when one of the credit agency's downgraded the US to AA+ and everyone was afraid of another big wipeout as a result. Instead, it stayed stable (with a slight increase) of investment because of the chaos going over there, or so some of the experts alluded to.

[Mizhara]

Hmm. I probably haven't been paying as much attention to the European financial news, so I'll take your word for it. Besides, living in Norway pretty much means we don't see any of these problems. The average guy's financial situation is largely unchanged. (Hell, mine improved).

[lallara zhuul]

Linky!

[Mizhara]

Linky!

Thank you, that is quite informative. Especially the comments below noting that it's all due to the International Bankers who wants a New World Order and got China the money. If the Illuminati, Majestic 12 and Masons are really running things through the 'World Bank' or whatever, they're not doing a very good job of it.

[Kiki Truzhari]

I don't know if its been noted before, but this is basically a Stand Alone Complex.

[Z.Sinraali]

Dex: It would, to the extremely small extent that low income households have any capital gains, raise their taxes. But it would far more significantly raise the taxes of high income households, who make up that 1% that the Occupy Wall Streeters are protesting. End result is a fairer tax system with a healthier balance between labor and capital.

The bottom line with taxes is that when you tax something, you get less of it. So yes, to an extent that the usually-proposed 0.02 to 0.25% tax would reduce investment, or more precisely purchases of stock and other financial instruments. However, this is a much smaller cost to long-term investors than short-term speculators, because it's a fixed cost. If you buy a stock and sell it the same day, you lose a much larger portion of your profit than if you buy and hold for the long-term, right? Now, I won't tell you that short-term investors have no value to the market, because they do, particularly in normal market operations where they stabilize prices. But when things go wrong, they go extra-wrong, because as much as these investors would like to claim otherwise, they're just as irrational as everyone else.

So if you're interested in reducing market volatility and advantaging long-term investment, you're better off with a financial transactions tax.

You're also entirely right that cutting government spending reduces employment, which I personally thank you for, because so many people don't understand that simple fact. Setting aside questions of efficiency and multipliers and all those pain in the ass technical details, however, it comes down to which is a better way to spend your billion dollars: F-35s and servicemembers or bridges and teachers? They both inject money directly into the economy, but the latter also serve as investments which allow faster future GDP growth.

[Myrhial Arkenath]

There's been lots of talk about the stability of the EU and whether they will survive the insolvent governments going under or if there'll be a bailout. All that talk was going on when one of the credit agency's downgraded the US to AA+ and everyone was afraid of another big wipeout as a result. Instead, it stayed stable (with a slight increase) of investment because of the chaos going over there, or so some of the experts alluded to.

Can't judge the EU as one entity like you can with the US, really. Some countries are doing really shitty (Greece is one), and some are still going strong (them cold places up north ). And then you have the ones caught in the middle because we gave our money to the countries that are suffering.

I'm wondering where it is all going to go, really. If one thing falls over, it can spark a chain reaction, because we're still counting on getting that money back. And then there is the effect it has on the Euro. So then there is talk of getting rid of that again. While I would find it inconvenient, on the other hand perhaps it wouldn't be such a bad idea. It won't fix anything, but at least it stops our money becoming worth less while we are at the same time pumping money into a broke economy because we're doing that to stop our money from becoming worth less. *breathe*

For as much as I like playing with virtual currencies, this is exactly why I could never get an economics degree. Or well, I could get one, and then not use it, because the topic highly interests me, but fuck that I'm going to work in an industry that requires you to effectively turn off you conscience. Not that other industries are not just as corrupt, but gambling with people's money like it's a super high stakes casino game ranks pretty high on my do not want list.

[Z.Sinraali]

Economics is not the study of how to be a financier, damnit. [/angryguywithecondegree]

[Myrhial Arkenath]

See, I never bothered to look into the actual degree stuff, sorry to upset D: /stupidITperson

[Lyn Farel]

There's been lots of talk about the stability of the EU and whether they will survive the insolvent governments going under or if there'll be a bailout. All that talk was going on when one of the credit agency's downgraded the US to AA+ and everyone was afraid of another big wipeout as a result. Instead, it stayed stable (with a slight increase) of investment because of the chaos going over there, or so some of the experts alluded to.

Can't judge the EU as one entity like you can with the US, really. Some countries are doing really shitty (Greece is one), and some are still going strong (them cold places up north ). And then you have the ones caught in the middle because we gave our money to the countries that are suffering.

I'm wondering where it is all going to go, really. If one thing falls over, it can spark a chain reaction, because we're still counting on getting that money back. And then there is the effect it has on the Euro. So then there is talk of getting rid of that again. While I would find it inconvenient, on the other hand perhaps it wouldn't be such a bad idea. It won't fix anything, but at least it stops our money becoming worth less while we are at the same time pumping money into a broke economy because we're doing that to stop our money from becoming worth less. *breathe*

For as much as I like playing with virtual currencies, this is exactly why I could never get an economics degree. Or well, I could get one, and then not use it, because the topic highly interests me, but fuck that I'm going to work in an industry that requires you to effectively turn off you conscience. Not that other industries are not just as corrupt, but gambling with people's money like it's a super high stakes casino game ranks pretty high on my do not want list.

What Myrial said, EU is not doing worse than US (considering the huuuuge US public debt, they are in no place to lecture us, especially all the countries still struggling and doing much better than they do themselves).

Then, I do think the removal of the Euro would equate to directly shooting a bullet in our heads. I do not even want to imagine the cataclysm afterwise, especially the countries getting rid of the Euro, with a currency that will be worth absolutely nothing (remember the crisis in 1930 where the smallest bit of bread was worth thousands of units of said currency?). Especially if every country is left alone to deal with that. People are not realizing how helpful is the EU to keep the local markets stable. What will do countries like Norway or Switzerland if all the market crumbles around them ? Or what will do pillars of the EU like Germany and France if everything progressively detaches itself from the core of the EU, slowly dying in its corner ? Nobody live in autarky, and its a spiral : if you create an economic black hole near you, you will get sucked into it eventually.

But I was glad recently to hear that there is a lot of discussions in the european congress to create a commission charged to examine every member's budget and put limitations to it, by (constitutionnal/legal) force if necessary. People will have to spend less and make concessions, yes, but that would at least force our damn politics to stop playing the popularity card, when its actually not fixing anything (as long as you promise people more and more money, again and again, just to please them and get re elected...).

[orange]

There's been lots of talk about the stability of the EU and whether they will survive the insolvent governments going under or if there'll be a bailout. All that talk was going on when one of the credit agency's downgraded the US to AA+ and everyone was afraid of another big wipeout as a result. Instead, it stayed stable (with a slight increase) of investment because of the chaos going over there, or so some of the experts alluded to.

Can't judge the EU as one entity like you can with the US, really. Some countries are doing really shitty (Greece is one), and some are still going strong (them cold places up north ). And then you have the ones caught in the middle because we gave our money to the countries that are suffering.

Except you shouldn't really judge the US as a single entity either.  As an example, policies & labor markets in Alabama & South Carolina are attracting foreign and domestic investment in the Automotive and Aircraft industries.  But Detroit/Michigan's auto industry has been in decline for decades and some of its companies received government funding to not go into bankruptcy.   California has a huge budget problem and corporations are leaving the state, while Texas is seeing some growth in its economy.

The United States has more than 300 million people and individual component states with economies rivaling those of most nations.

You're also entirely right that cutting government spending reduces employment, which I personally thank you for, because so many people don't understand that simple fact. Setting aside questions of efficiency and multipliers and all those pain in the ass technical details, however, it comes down to which is a better way to spend your billion dollars: F-35s and servicemembers or bridges and teachers? They both inject money directly into the economy, but the latter also serve as investments which allow faster future GDP growth.

I used a DoD program because I know how they work (I am currently one of the government oversight folks).   The major point was that procurement programs or well thought-out service programs are, in my opinion, a better way to inject money into the economy than just giving it way.

As for which is better to spend money on, most people will say bridges and teachers.  They see immediate and easily understood benefits from such programs.   F-35s and service members can have benefits that are not as easily understood or have immediately visible benefits to others.

[Invelious]

Well, I'm no economics major, but its pretty clear to me that most of the world was wholly unprepared for the consequences of a global economy and the kind of impact it would have when things go south..because things have been relatively stable since its inception.

http://en.wikipedia.org/wiki/The_great_depression

There have been "recessions" before this also. Capitlism has never been "stable".

[Ava Starfire]

I, for one, welcome our new fascist police state. Elevation of the corporate elite and rampant spending on the military has NEVER ended poorly before! After all, the corporate entities in the US are the only people who really matter. As long as the top few % can afford to send their kids to college, see a doctor, and maybe live in a neighborhood that isnt a crime ridden shithole, the rest of us should be happy for them! Thou shalt not covet, it says! Amurrikuh!

/sarcasm off

The protest is great. I have my doubts if anything good will come of it in the short term, but at least now the rest of the world can see that, no, not ALL in the US are braindead drones, living only for the new I-phone, PS3 game, or pointless raunchy comedy film.

Police in the US have been taking liberties with "rights" for decades. In my family, getting your ass kicked by the cops is almost a rite of passage. There just werent cameras in every phone in everyone's hands... mostly because there were no cell phones.