You've heard me say here that many of FDR's schemes were lunatic and probably helped prolong the depression. (If you're a liberal, you have probably spent more than a little time in the comments screaming that I'm a heartless and innumerate fool who wouldn't know good economic policy if it bit me in the aggregate demand.) But of course, some of his policies actually helped the depression, like the FDIC. Some of them did nothing about the Depression, but were good for other reasons, like (I'd argue) the WPA. Some of them were possibly unwise, but not horrific; the TVA comes to mind. And some of them were disastrous, like the NRA and the attempts to drive up the price of gold through open market purchases.
What distinguishes the worst programs? Assigning a causal role to symptoms. FDR's economists had noticed that when the price of gold went up, so did (generally), the price of other commodities. Some lunatic suggested that one might raise the price of commodities which were currently in big trouble by driving up the price of gold, and FDR tried it. Gold and commodities tend to rise in tandem, of course, because demand for money (which gold then was), and for gold as an industrial and jewelry uses, expands when the economy is booming, as do demand for food and oil and all other good things.
Similarly, some bright boys in FDR's administration noticed that wages and prices tend to rise in boom times. Hence, they decided that by keeping wages and prices high, they could bring back prosperity. The National Industrial Recovery Act attempted to organize the economy into giant wage-and-price fixing cartels of industry and labor.
The result, in a time of contracting demand and deflation, was to create more unemployment and deprive consumers of goods.
I wonder if the policy community's current fixation on propping up housing prices is not akin to these plans. Prices of houses are contracting as a result of the collapse of a credit bubble--but are falling house prices a cause, or a symptom? Europe's experience seems to suggest the latter.
Thus, I naturally wonder if fighting to keep the housing market from falling might, like the NIRA, actually make things worse. I'm still thinking through the implications of exactly how it might disimprove our current nasty disequilibrium--though shutting out new homebuyers is surely part of it. But it's something to worry about that no one I see is much worried about. A lot of people are grousing that it won't work, but very few are complaining that the act of propping up prices might, by itself, worsen the housing market and the general economy. Am I crazy?
Copyright © 2009 by The Atlantic Monthly Group. All rights reserved.
Why are high and rising house prices a good thing anyway? I think if you graphed oil and house prices they both (until their falls) showed steady and consistent upward slopes, yet we were all happy about rising house prices and sad about rising oil prices. Yes, there are more homeowners than oil well owners and the latter were happy with high oil.
It is good for me as a consumer if oil prices are low it means I've got more money left for everything else. It is also good for me that my new $500 laptop is alot better than the $1000 laptop I bought 5 years ago. So, why is it that if it cost me more to rent/buy a house that is a good thing?
Fighting the fall in housing prices isn't going to work what might work better is if we work on solving the problems caused by the fall in housing prices. As one example we need to think about how we get a functioning and stabilized mortgage market after all the pain caused on the way down on housing prices. As another we need to think how all the people with foreclosures on their credit report get financing when the market stabilizes ie if people who made an honest mistake in buying at peak can't get a mortgage, that will put alot of people out of the market for houses and could make the situation even worse (yes there is some moral hazard issue to think through)
I share your mystification, Megan. We're in a house and not planning to move for 20 years, barring a crisis, but if I were a renter I'd be furious these days.
Said the girl who supported TARP. Aren't you also the one who said that it ended up being bad policy that was rightly decided? And wasn't the ultimate goal of TARP to provide stability to credit markets by propping up housing prices?
Nick,
TARP had nothing to do with propping up housing prices. I'm not sure where this idea has come from. Somebody was on NPR just this morning talking about how Treasury has mismanaged TARP because it hasn't prevented foreclosures.
The original goal of the TARP was to alleviate the credit crunch by having the government buy illiquid mortgage backed securities from banks with liquidity problems, but otherwise sound. Obviously, that isn't what's happened, and the whole thing is a travesty. But failing to use TARP to prop up housing prices is not the reason.
I'm a renter since selling my place in 2005. I'm not furious. Central planners like Elizabeth Warren are born to fail. All I have to do is wait them out.
I don't think anybody would argue that many of the things tried by FDR didn't work, would never work and likely made things worse. But to imply that his policies prolonged the depression? Pure revisionist history.
Economists widely acknowledge that FDR's "alphabet soup" of programs kept the country going through the worst of the Guilded Age fallout. Its a simple concept - keep people working so that they have money, which they then spend. Unfortunately decades of class warfare and callous disregard for anyone who hasn't attended the toniest B-school has rendered these basic concepts out of fashion.
Luckily for all of us Obama seems to be willing to take us back to square one. In a year you and the rest of the glibertarians can naysay from the sidelines (mercifully) while the rest of us work to bring the country back from the brink. Deal?
Wow, Mike MI, what a stunning display of ignorance on your part. Worshipping at the altar of The One certainly has blinded you to basic facts.
FDR's policies prolonged the depression. Period. See Thomas Sowell or any other economist with half a brain.
Mike M, the recession was projected to be over in the fourth quarter of 2009, before Obama unveiled his socialism. Now it's projected to go longer.
Coincidence? Or do socialist brain-dead hippie ideas hurt the economy?
You decide.
"Mike M, the recession was projected to be over in the fourth quarter of 2009, before Obama unveiled his socialism. Now it's projected to go longer."
People like yourself undoubtedly said six months ago that we weren't and never would be in a recession and anyone saying so was just a whiner.
And what, pray tell, is Obama's "socialism" that's singlehandedly killing the economy? His proposal to let top marginal tax rates sunset back to 2000 levels as they were designed to do in 2010? (Which probably won't happen anyway.)
Perhaps you're mistaking which President (and which Republican presidential candidate) were ardent advocates for TARP. Or is it that Bush was just too socialist?
I'd love to hear precise details on exactly which proposals are prolonging a recession, and cites of respected economists verifying those views. Surely this is major news that needs to be spread as fast as possible.
Question:
Many of the people who are losing their homes are going to go from $2500 a month mortgage/property tax/insurance to $1000 a month rentals?
I think the pressure to "keep people in their homes" comes from the idea that if people lose thier homes they will be on the street. Not only will they not be on the street, they will have far more disposable income.
Megan:
I strongly feel that artificially propping up housing prices will actively make things worse.
But I neither teach at Harvard, nor write for the NYTimes.
"I think the pressure to "keep people in their homes" comes from the idea that if people lose thier homes they will be on the street. Not only will they not be on the street, they will have far more disposable income."
Yes, that's perfect logic. We'll get the economy back on track by throwing people out of their houses, so they can get cheaper apartments and have more discretionary income! More spending!
The "pressure" is 1. because for many people the equity in their house represents most if not all of their savings, and it's really bad for the economy if people lose all your savings, and 2. because banks foreclosing is really bad for the banks. They don't *want* the houses, especially if they can't resell them. Often that's just a loss they have to mark down, and enough of those lead to bank failures.
Oh, and to clarify: artificially keeping home prices high is a terrible, awful idea for keeping people in their houses. The correct strategy is to let them refinance the ARMs they were dumb enough to get into, perhaps with government assistance, and then let house values fall to what they would naturally be. That's a much softer hit for the homeowners.
"FDR's policies prolonged the depression. Period. See Thomas Sowell or any other economist with half a brain."
So view it through a lens that YOU agree with?
"Mike M, the recession was projected to be over in the fourth quarter of 2009, before Obama unveiled his socialism. Now it's projected to go longer."
This is an interesting thought. Obama's policy proposals have already lengthened the recession? So, in reality, its not government intervention, just the threat of it?
Adam:
"People like yourself undoubtedly said six months ago that we weren't and never would be in a recession and anyone saying so was just a whiner."
---Love that straw man you've created. Knock it down man, and burn it to the ground!
Your analysis sounds right on the money to me. But being right is one of the more certain ways to get yourself denounced as crazy -- especially by those who hate having their ideologies contrasted with actual, you know, facts.
"Love that straw man you've created. Knock it down man, and burn it to the ground!"
I notice you didn't refute it. Did you, or did you not say in the summer that people claiming the economy was in a recession were crazy and that they should stop complaining? All I'm saying is that you seem like the type that would say that, since, you know, that was the Republican talking point of the time. And that a lot of people that did say that then are now saying exactly what you're saying now. So I made an educated guess.
Adam,
"because for many people the equity in their house represents most if not all of their savings, and it's really bad for the economy if people lose all your savings"
But I think we need to get away from people keeping all their savings in the form of their home. Part of the reason American savings rates fell so low is that people were spending 2-3k a month on a mortgage on a home that should only have needed a 1500 mortgage. We'd be much better off if people only paid 1500 in mortgage and saved and invested the spare 1500 in other asset classes - stocks, bonds, etc.
We need to break the back of the real estate myth and the only way we can do that is if we have people out their telling stories about how they lost their shirts in real estate. This will ensure that prices stay reasonable for some time into the future.
So Roosevelt banned the private ownership of gold because he wanted to drive the price up? Wouldn't that fail miserably because it would drive down demand? I'm not 100% sure of that, but it seems right, especially given that the price skyrocketed when private ownership was legalized again.
Also, wasn't this when the US was still on the gold standard? What does it mean for the price of gold to go up when you're on the gold standard?
"---Love that straw man you've created. Knock it down man, and burn it to the ground!"
I'd say your opinion that "socialist brain-dead hippie ideas" that haven't been implemented, yet have still managed to hurt the economy, falls under this category as well.
jmo,
You're absolutely correct. People do spend too much of their salary on houses that are too big for them, and house prices still have a ways to fall before they're where they should be.
On the other hand, the proper way to deal with the situation is absolutely not to just let everyone who bought a house they shouldn't have get their just desserts, so future potential buyers can have a "warning". I mean, I guess that's the proper libertarian way, but in terms of what course of action will make the economy better, it isn't. Those goals don't often correspond.
The useful thing that the authorities can do for house prices in a price crash is to damp the downward overshoot as prices fall below long term relations to income and to rentals. The Fed has already done that in taking interest rates so low.
Doing more to sustain house prices is (in so far as you succeed) refusing to recognise losses that have occurred. Putting off recognising losses that are corrections of over-valuations anywhere in the economy (to take an example that is $17 billion distant from 'gratia', GM plus Chrysler)is a reliable general route to lengthening a recession.
"I'd say your opinion that "socialist brain-dead hippie ideas" that haven't been implemented, yet have still managed to hurt the economy, falls under this category as well."
---Yes, because economies never fall prey to fears of threats and actions unrealized.
Tool.
Adam says:
And if "where they would naturally be" is less than what the buyer paid: 1. the poor schmuck is upside down and has lost all his savings, and 2. one he realizes this he will stop paying the refinanced mortgage and the bank will have to foreclose anyway.
Keep in mind that many or most of the troubled loans had reduced or non-existent down payments, so #1 is almost guaranteed to be true.
What am I missing here? How can this possibly work? As far as I'm concerned, what we should do is get the pain of reduced prices over quickly, let the people and institutions affected work it out in bankruptcy, then let those who didn't over-extend themselves benefit from the lower prices.
Of course, since that doesn't require a massive new government program, we can be sure that the politicians will choose some other approach.
Ben Bernanke and many other main stream economists would take violent exception to you views on FDR and the price of gold. It is clearly a strong view of conventional economics that this was the single most important thing FDR did to end the depression.
I challenge you to defend your point that taking the US off the gold standard and raising the price of gold was a bad policy.
Adam:
1.Do you know the definition of straw man? Better look that up. Merriam-Webster's a bitch, I know.
2. I don't believe anyone here was arguing about whetehr we were in a recession in the summer, but if we were heading to one. Since I couldn't predict the future last summer, I would not stated that there was no recession coming.
3. We weren't in a recession in the summer. Period. We got into a recession (I think; unofficially, the numbers haven't come back yet, but all signs point to us being there now) this quarter. Better use that definition of "recession" in Merriam-Webster as well.
eejit.
"Since I couldn't predict the future last summer, I would not stated that there was no recession coming."
Yet you subscribe to predictions that say the recession will now last longer, due to Obama's proposed policies? No bias there, huh?
"What am I missing here?"
Well, mostly that the two options you're considering are 1. slowly letting house prices decline while helping people over their heads refinance their mortgages into terms that will make it more likely they'll stay in their house, or 2. have mass foreclosures and bankruptcies, and probably bank failures in the middle of a recession, which is sure to lead to lower tax revenue and deflation. One of those sounds awfully Hooveresque, though for all I know Hoover may be the role model of the posters here.
"Yes, because economies never fall prey to fears of threats and actions unrealized."
The recession, of course, started in 2007. The housing bubble popped earlier than that, and credit default swaps have been unregulated much longer than that. Clearly the economy foresaw Obama winning Iowa and implementing policies slightly more progressive than currently exist years in the future, and decided to collapse accordingly. I mean, that *is* what you're arguing, right?
The "pressure" is 1. because for many people the equity in their house represents most if not all of their savings, and it's really bad for the economy if people lose all your savings,
What equity? There is NO equity in these homes. That's the problem. That's why a few people are calling for something, anything to prop up home prices.
I think the reason nobody is trying to marshal a serious argument against a policy of propping up real home values is that its a practical impossibility. No government has the resources to bail out all homeowners, and restricting it to the "worst hit" homeowners would involve a massive transfer of wealth from responsible homeowners and renters to real estate speculators. And however attractive that might be to some policy makers, it would be political suicide.
No, they'll try to tinker with nominal property values via deliberate inflation first. Maybe Disco will come back.
"---Yes, because economies never fall prey to fears of threats and actions unrealized."
Then why didn't the reverse work when all the Pollyannas told us the economy was fine?
"We weren't in a recession in the summer. Period."
Oh, ok. So when I said you were the type of person who said in the summer we weren't in a recession, you called that a straw man and berated me for it. Even though you RIGHT NOW hold that view and certainly did then too. Could you be any less intellectually honest?
Anyway, it very clearly started in late 2007. This has been established by the government agency responsible for determining when recessions start. Their word is official. Look it up.
Adam,
Someone bought a home for 400,000 for one brief moment it was worth 425,000 and now it's worth 305,000. All the money they thought they had is gone all they have left is a 3000 a month mortgage. They have lost all their money.
If they move into a $1250 a month apartment and save $1000 a month for the next few years - they will end up with more savings that if they kept their house.
Why is moving people into rentals so they can save actual money worse than keeping them in homes so they can make payments on assets that have declined 30%.
"Oh, ok. So when I said you were the type of person who said in the summer we weren't in a recession, you called that a straw man and berated me for it. Even though you RIGHT NOW hold that view and certainly did then too. Could you be any less intellectually honest?"
----Were you arguing that we were in a recession IN THE SUMMER? Naysayers were stating we WERE HEADING TOWARDS A RECESSION. Bulls were stating poppycock. Everyone else (me included) was inbetween. You would have been the only one arguing we were in a recession in the summer, and you would have been flat wrong; no one was, because it requires multiple quarters of bad growth, and only one quarter was possible.
So yes, moron, it is a straw man. NO ONE WAS ARGUING ABOUT US BEING IN A RECESSION IN THE SUMMER, BECAUSE IT WAS IMPOSSIBLE TO BE IN ONE AT THAT TIME.
PLUS, MORON, I DID NOT DENY THAT WE WERE HEADING TOWARDS A RECESSION.
Someone please slap Adam upside his wittle wiberal head.
What jmo said. Pouring all your money into a bigger house may be saving in a personal sense (i.e., you can draw on home equity if you need money), but in a macroeconomic sense a house is a durable consumer good. The kind of saving that matters, macroeconomically, is the kind that can be invested in capital goods that make the economy more productive, like factories and construction equipment. Bigger houses don't make the economy any more productive than do bigger TVs.
jmo,
"Why is moving people into rentals so they can save actual money worse than keeping them in homes so they can make payments on assets that have declined 30%."
It isn't. What part of "help people refinance their terrible mortgages according to the house's current value" isn't clear? The whole idea is that we want people to stay in houses instead of renting because there's more tax revenue from people owning property, and less losses for banks so they don't close. Therefore you want to make it once again attractive for people to own. Obviously nobody's going to pay $3k mortgage vs $1k rent when they're upside down, so the choices are help them refinance and start getting equity again or have massive foreclosures and bank failings.
Your argument that they'll have more money is pretty shallow too. For the most part the people who are about to lose their houses simply *can't pay* 3k a month, so it's not like they're doing so right now. They signed at 1.2k with an ARM and likely right now aren't paying anything at all and just sitting in their house waiting to be foreclosed on.
"NO ONE WAS ARGUING ABOUT US BEING IN A RECESSION IN THE SUMMER, BECAUSE IT WAS IMPOSSIBLE TO BE IN ONE AT THAT TIME."
That's funny. Because we were. And people said so at the time. Lots of us. Here's a hint for you: The Q2 numbers that come out June 30th aren't golden, and they get revised later on. That's why it was announced last month that we've been in a recession for a year. Seriously, do you just not pay attention or something?
Adam:"Anyway, it very clearly started in late 2007. This has been established by the government agency responsible for determining when recessions start. Their word is official. Look it up."
---No, moron. The recession started this year (2008). Problems in the economy/economic downturn may or may not have started in 2007---separate question, it could have been earlier---but a recession is two quarters of negative growth. There had not been until 2008.
Welcome to the clue train. Next stop: you. Get one.
I see Adam subscribes to the "whenever at least one person who is famous calls for a recession, there is one" school of economic thought.
And, my point stands: I never said we were not headed towards one, dumbass.
"a recession is two quarters of negative growth"
You know, you'd be taken a lot more seriously if you used the definition that's actually used by most economists instead of the Webster's hypertechnical definition that relies on heavily fudgable government data.
"What part of "help people refinance their terrible mortgages according to the house's current value" isn't clear? "
What is the penalty for the homeowner?
Are you not infavor of imposing any penalty on all the fools who got taken by the real estate myth?
*banging head against desk*
Can someone please point Adam to the nearest reading class? Talking to sped kids is frustrating.
"What is the penalty for the homeowner?
Are you not infavor of imposing any penalty on all the fools who got taken by the real estate myth?"
They should obviously be penalized. I have no idea what penalty would be appropriate. Presumably a lot of very smart people who come up with economic policy would determine that. I would say there's a big difference between 100% bailout and 100% let them fail. I'm just trying not to cause a domino effect, and it seems like some sort of gradual failure rather than a drastic one would work better for that.
Adam: "You know, you'd be taken a lot more seriously if you used the definition that's actually used by most economists instead of the Webster's hypertechnical definition that relies on heavily fudgable government data."
----Wow.
Apparently Adam hates technical answers, such as those used by FINANCIAL FREAKIN' PROFESSSIONALS and ECONOMISTS!!!
http://www.bloomberg.com/invest//glossary/bfglosr.htm
http://www.businessdictionary.com/definition/recession.html
Adam, you have been pwned. Do not pass go. Do not collect $200. Go directly to Berekely.
Adam: "Presumably a lot of very smart people who come up with economic policy would determine that."
--At last, Adam admitting he isn't smart. It's a step, people, it's a step.
jmo, Adam doesn't listen to arguments. He already knows what is right, basic facts and definitions be damned. His straw men defeat all your arguments.
"Apparently Adam hates technical answers, such as those used by FINANCIAL FREAKIN' PROFESSSIONALS and ECONOMISTS!!!"
Yes, I hate what actual economists say:
According to the Philly Fed's Survey of Professional Forecasters -- 51 of 'em -- the current recession started in April.
http://www.philadelphiafed.org/research-and-data/real-time-center/survey-of-professional-forecasters/2008/survq408.cfm
But hey, why ask actual specialists what they think when you can use a one-sentence definition?
Also, note that they only think the recession will end because of Obama's "socialist" stimulus package.
Basic, neither Merriam-Webster nor the NBER use the two quarter definition. So it's just a matter of where you want to cherry pick to support your argument.
http://www.nber.org/cycles/dec2008.html
http://www.merriam-webster.com/dictionary/recession
Cherry pick???? CHERRY PICK???
YOU THINK RELYING ON THE TRADITIONAL DEFINITION OF RECESSION IS CHERRY PICKING???
Well, at least you're not angry at my "hypertechnical" definition any more.
The NBER is not widely accepted. It is a newer, less accepted version of the term. The traditional, and more followed definition IS THE ONE I GAVE YOU, PUNK.
If anyone is "cherry picking", it's you, citing a statistic that does not comport with our historical definition of recession. But hey, that straw man you've created keeps multiplying.
AGAIN, PWNED!!!!
It appears we've hit a nerve.
Anyway, the NBER is in fact the official source, and far more widely accepted than "businessdictionary.com". Feel free to keep tilting at windmills though. I don't expect you to ever see anything but black and white.
Adam,
I think we mostly agree. I was think if the mortgages are lowered to the current price of the home the homeowners should loose 100% of any upside if they sell in 5 years, 75% if they sell in 10 years, 50% in 15 years, 25% in 20 years and 0% after 25. This would include the current home and any subsequent home for 25 years from the date the mortgage is restructured.
Oh and they premanently loose the capital gains tax exemption for their primary residence.
The numbers might have to change as we want enough incentive for people to take proper care of their homes.
jmo, that sounds like a very reasonable plan. That's pretty much what I had in mind.
"The NBER is not widely accepted."
Now you are just being silly. Please read second paragraph. Or simply continue to post ad hominem attacks.
"NEW YORK (CNNMoney.com) -- The National Bureau of Economic Research said Monday that the U.S. has been in a recession since December 2007, making official what most Americans have already believed about the state of the economy .
The NBER is a private group of leading economists charged with dating the start and end of economic downturns."
http://money.cnn.com/2008/12/01/news/economy/recession/index.htm?postversion=2008120112
Adam:
"But hey, why ask actual specialists what they think when you can use a one-sentence definition?"
---I hate it when people use the words to mean what they actually mean.
"According to the Philly Fed's Survey of Professional Forecasters -- 51 of 'em -- the current recession started in April."
--True. When was this survey given? November. In other words, after the second quarter of what they thought was actual negative GDP growth.
Note this, idiot: they did not give the survey in July. Why? Because the most the economists could say was "we think we may be headed for a recession, depends on the GROWTH IN THE FOLLOWING QUARTER."
So the economists did not say in the summer that we were in a recession. They might have predicted we were heading towards one (as some did), but we would nto have been found to be in one.
Adam, I now pwned everything you have. Please go directly to the commune, hippie.
Megan, no one can tell if you are crazy, because you didn't source your evidence. Use some of that crazy html stuff to prove your point. Feel free to reference something peer reviewed or from an academic press, but you can settle for a think tank or magazine if no actual scholarship supports your theory.
hahahaha: "The National Bureau of Economic Research said Monday that the U.S. has been in a recession since December 2007, making official what most Americans have already believed about the state of the economy."
So CNNMoney accepts it, so it must be official? And the White House? The same White House that thinks waterboarding isn't torture?
The official definition of recession is TWO QUARTERS OF NEGATIVE GROWTH.
Note that I am not saying we are not in one. But trying to state that because the NBER says it is a recession DOES NOT MEAN IT MEETS THE TRADITIONAL DEFINITION.
Arguing with Adam is giving me a headache.
"So the economists did not say in the summer that we were in a recession. They might have predicted we were heading towards one (as some did), but we would nto have been found to be in one."
Ok, I know logic's not your strong point but bear with me here.
They say it started in April.
June is after April.
Therefore, June is after the date on which it started.
Therefore, it was ongoing in June. Of course, you can't say that with certainty at the time because you don't see the June stats until after June, but a lot of people saw everything going downhill for a few months and said we were clearly already in one.
The reason this works is because said 51 economists, along with most of us, were not using the absurd "two quarters" definition, under which the government can massage stats however is necessary to say we have 0.1% growth and thus claim indefinitely that there is no recession even though many other stats are down. Hence why entities like NBER exist to provide a more nuanced approach for those of us who can see shades of grey.
you're right, Adam, Bloomberg.com is a completely unreliable financial source. I'm glad economists and market movers don't rely it for information.
Adam: "Ok, I know logic's not your strong point but bear with me here."
---This from the man who thinks the traditional definition of "recession" is whatever he thinks it is?
"They say it started in April.June is after April."
---No kidding, huh? Here's some logic for you.
They say it started in April. Month number 4.
June is month number 6.
4-6 would be a quarter.
6-9 would be the next quarter,
November is month number 11. Post those two quarters. (Keep up here, boy).
However, in order to be a recession, there must be 2 consecutive quarters of negative growth.
Let's say 4-6 was a negative quarter. No recession yet. However, when 6-9 posted a negative growth, then month 4 (april) would be the start of the recession.
You can't start a recession before you start a recession, boy.
Now, you might argue that quarters start at different months. Fair enough.
"The reason this works is because said 51 economists, along with most of us, were not using the absurd "two quarters" definition, under which the government can massage stats"
---because the government only massages negative quarter growth stats, and not other stats, say, NBER stats? Wow, isn't funny that in Adam's world, only those statistics that back him up are unmanipulated facts. Anything that contradicts him---LIKE BASIC DEFINITIONS OF WORDS----is manipulated and unreliable. Weird how that happens.
"however is necessary to say we have 0.1% growth and thus claim indefinitely that there is no recession even though many other stats are down."
---I know you think Bush is the devil and free markets are for capitalist swine and all capitalists lie, but do realize that economists do not merely believe fake stats.
"Hence why entities like NBER exist to provide a more nuanced approach for those of us who can see shades of grey."
---NBER exists, but it does not dominate. You argue that somehow because NBER agrees with you, it's better. I hold to the old definition because that is what accepted by non-NBER economists.
God, get a clue.
And I aks you again: please point out where I said there is no recession pending.
Wait a second----didn't ADAM just try to argue that the recession started in 2007??? Wasn't one of his points--the recession has been longer than I am admitting?
Now he's arguing it started in April 2008??? Which, gasp, AGREES with me?
Adam, you might want to check yourself there, son.
Basic, it was me who provided the link to the article that the NBER called the start date of the recession as 12/07. BTW, your insistence on going by Bloomberg.com's definition is no different than Adam or myself agreeing with NBER. However, you purport to know the facts, when you are merely providing your opinion.
Adam:"Anyway, it very clearly started in late 2007. This has been established by the government agency responsible for determining when recessions start. Their word is official. Look it up."
And Adam again: "According to the Philly Fed's Survey of Professional Forecasters -- 51 of 'em -- the current recession started in April."
Yep, there we go.
Game. Set. Match. Bitch.
Home buyers took out mortgages assuming the value of property would never stop growing, let alone decline. Lenders offered money knowing the assumption was invalid but assuming they could find investors who had the same assumptions to buy the loans as securities before the inevitable decline. So any mortgage with a face value significantly higher than the current market value involves two parties who made false investment assumptions, the home buyer and either a lender or security investors. So each should lose equally on their investment, right?
The consensus here seems to be that anyone who wants to stay in their home should only be allowed to under punative terms. But since the lenders mostly made the buyers invest nothing any punative terms will encorage them to walk away leaving the lender with additional losses for resale costs beyonmd their losses from irresponsible lending in the first place.
Apologize, RG. I didn't realize I was dealing with a double dose of moronic logic here.
Basic, the NBER said December 2007. That link has been posted, and is the official source. The first link I found was that survey, which said April. The NBER is significantly more detailed and lists lots of various numbers which are independently verified. That carries significantly more weight to me than one single number (Quarter growth). It also carries more weight than your definition with the large majority of economists. So, I'm going to trust their judgment over yours.
Now, feel free to get back to the initial point: which of Obama's socialist policies are singlehandedly extending the recession.
I don't think they knew that at all. I think pretty much everyone was convinced that the worst case was a stagnation in prices. I don't think 1/100 people thought prices would decline as much as they had.
Rg: "BTW, your insistence on going by Bloomberg.com's definition is no different than Adam or myself agreeing with NBER."
---Yes, going with the traditional definition of recession is cherry picking.
Adam: "Anyway, it very clearly started in late 2007. This has been established by the government agency responsible for determining when recessions start."
And Adam again: "under which the government can massage stats however is necessary to say we have 0.1% growth and thus claim indefinitely that there is no recession even though many other stats are down."
So, the government is always right until it disagree with Adam, in which case they are manipulated fools.
QED, boy.
"Now, feel free to get back to the initial point: which of Obama's socialist policies are singlehandedly extending the recession."
Which according to Basic Fact's defintion, we can't technically be in, because only 3Q had negative growth. So, once again, how can Obama's proposed policies extend a recession we aren't, by definition, in?
"So, the government is always right until it disagree with Adam, in which case they are manipulated fools."
The NBER is, of course, a private non-profit organization whose sole purpose is to look at a wide range of economic factors to determine the state of the economy. Hell, your boys Friedman and Mises were on it. One would think they have much less of a vested interest in an accurate reading of the economy than the government in an election year. Maybe that's just me, though.
Basic Fact - After reading your "discourse" I've determined you're either 12 years old boy or the CEO of AIG, because nobody could be this rude and ignorant just because.
You can quibble over when the recession started as long as you want, the fact of the matter is that its here and market ideology has fallen by the wayside as the rats are all trying to jump ship. You're just the asshole sneering at those trying to find a life jacket. Unhelpful, annoying, but will probably shut the hell up the minute the water is up to his stupid neck.
"---Yes, going with the traditional definition of recession is cherry picking."
I'd venture to guess NBER and Merriam-Webster have been around a little longer than Bloomberg L.P. Should we quibble over the definition of "traditional"?
jmo, if 51 economists who were just backing up Adam's point say it happened in April 2008, then perhaps they don't buy the NBER's stance.
Neither does this Financial Editor: http://www.cnbc.com/id/22883100/site/14081545.
NBER is not a government agency.
They weren't "just" backing it up, that survey was before the NBER's meeting that determined it went back further than previously expected. My guess is that the economists answering the survey gave considerably less thought to their answer than did NBER, since that's, you know, what NBER does. I just linked that to show you the snap judgment of actual economists that it was, in fact, going this summer.
Also, you should probably take into account before linking CNBC that Kudlow and the rest of the ultra-rightwing guys there are looked with massive grains of salt among people who don't agree with them (ie almost everyone). They were banging the "economy's just fine, no downturn coming, don't worry!" right up until everything went to hell.
If housing prices are increased to previous levels by government, by increasing the money supply, extraordinarily low interest rates, we will see higher prices, inflation everywhere else. So your $400k home, now selling for
Now, to do that outside of a bubble market, how much inflation do we need?
Calculate it, and if you aren't afraid now, you will be.
The biggest mistake government has made is thinking that somehow the bubble could be recreated. The bubble was just that. No amount of printing money will get people thinking that they can buy a second house on spec expecting a 20% return within a year.
Because that is what was driving the house prices up.
Derek
"What is the penalty for the homeowner?
"Are you not infavor of imposing any penalty on all the fools who got taken by the real estate myth?"
Lets say they get refinanced with a lower principal fixed rate loan.
Isn't debt forgiveness treated as income, for tax purposes? Might that not be a simple, good start?
1. Adam: ""Anyway, it very clearly started in late 2007. This has been established by the government agency responsible for determining when recessions start."
and Adam again: "The NBER is, of course, a private non-profit organization."
*shakes head at Adam, walks over to other conversations.*
2. Mike: "You can quibble over when the recession started as long as you want, the fact of the matter is that its here and market ideology has fallen by the wayside as the rats are all trying to jump ship."
---Ah, I love when commies complain that free markets shouldn't have down cycles! The collective is calling you, boy.
3. RG: "I'd venture to guess NBER and Merriam-Webster have been around a little longer than Bloomberg L.P. Should we quibble over the definition of "traditional"?"
---Please do. I can't wait for you to tell me that a financial service that the majority of the market relies on for day-to -day information is giving basic definitions incorrectly, or how "two consecutive quarters of negative growth" is not the traditional definition of recession.
4. "Which according to Basic Fact's defintion, we can't technically be in, because only 3Q had negative growth. So, once again, how can Obama's proposed policies extend a recession we aren't, by definition, in?"
---Well, considering the 4Q is almost over, and the numbers are poor, it looks like we may in the middle of one---we don't know. Perhaps I am caught up in the kerfluffle of chicken littles, I agree. But its amazing how Obama claiming he's going spend more kitty and regulate more markets and Bush bailing out everyone with a company coincided with a worse forecast.
I think Bush is laible for this now, but Certainly Obama's spreading the wealth around mentality is hurting expectations. That's why Summers was brought on---to assuage the markets before we give a trillion to the UAW come April.
But then again, you people probably think Reagan's tax cuts ahd nothing to do with economic growth.
"you people probably think Reagan's tax cuts ahd nothing to do with economic growth."
Well, it led to massive budget deficits that made him end up raising taxes back multiple times, except for the top rate. Kind of like the massive budget deficits after Bush's tax cuts.
Or should we discuss the economic growth under our 91% top marginal rate?
"But then again, you people probably think Reagan's tax cuts ahd nothing to do with economic growth."
GDP growth was slightly stronger during the Clinton years and their higher brackets. In addition, Reagan ran massive deficits.
"or how "two consecutive quarters of negative growth" is not the traditional definition of recession."
I'll argue that since you are insisting that yours is the proper definition, the burden of proof is on you. But, I will provide you with this quote, from a Bloomberg article:
"A recession hasn't been officially declared. The economy likely peaked in December or January and then started to decline, Martin Feldstein, a Harvard University professor and president of the National Bureau of Economic Research, said in an interview this month. The bureau's business cycle dating committee officially determines recessions."
http://www.bloomberg.com/apps/news?pid=20601087&sid=atJCjnItaPRk&refer=home
"But its amazing how Obama claiming he's going spend more kitty and regulate more markets and Bush bailing out everyone with a company coincided with a worse forecast."
I'd say the forecast had more to do with the poor earnings reports and projected layoffs than anything Obama claimed.
I love Adam's weaselling once he's been caught. It's a thing of beauty to watch.
"My guess is that the economists answering the survey gave considerably less thought to their answer than did NBER, since that's, you know, what NBER does."
--So, once again, only the information that backs Adam up is reliable, and if that same information hurts Adam's argument in other ways, it is unreliable. Welcome to Adamspeak.
"I just linked that to show you the snap judgment of actual economists that it was, in fact, going this summer."
---Which they thought was happening in November, if the date on the article coincides with the survey. And yes, they thought it might have been going on in the summer. Which doesn't contradict me; I said IN THE SUMMER we couldn't know BY THE TRADITIONAL DEFINITION OF RECESSION whether we were in one or not, but if two consecutive quarters also posted negative growth (July to September along with April to June), then the recession had begun in the summer. And it was impossible to judge it then via the traditional definition. I NEVER DENIED THE POSSIBILITY, DUMBASS.
Once again, boy, you can't start a recession without starting a recession.
"Also, you should probably take into account before linking CNBC that Kudlow and the rest of the ultra-rightwing guys there are looked with massive grains of salt among people who don't agree with them (ie almost everyone). They were banging the "economy's just fine, no downturn coming, don't worry!" right up until everything went to hell."
---Calling all fo CNBC ultra-rightwing is ludicrous. It's a money channel. And saying "almost everone" doesn't agree with Kudlow is idiotic; don't take your personal hatred of everyone to the right of Bill Ayers out by claiming all right wingers are nuts. Kudlow is respected, and if he made the wrong call on this and "said no chance," he should be browbeaten. But considering the respect he garners on money and markets, I wouldn't throw out the baby with his bathwater.
But remeber this truism that Megan, I believe, posted: Naysaying economists have predicted 42 out of the last 5 recessions. You're not calling bears out for bad predictions. Krugman has been calling for worldwide collapse (exaggeration) for roughly 8 years--hmm, his politcis couldn't have influenced that, could it?
"Krugman has been calling for worldwide collapse (exaggeration) for roughly 8 years--hmm, his politcis couldn't have influenced that, could it?"
Maybe. But did you consider Sowell's leanings when reading his criticism of FDR?
"Calling all fo CNBC ultra-rightwing is ludicrous. It's a money channel."
It's an ultra-rightwing money channel. The two are not exclusive. Kudlow is not respected by anyone outside of the far right, in large part because he's made hilariously wrong calls on almost everything of note. You would be unaware of this because you apparently think everyone who disagrees with you is a socialist.
Krugman, on the other hand, had been roundly criticized merely for *saying* that there was a housing bubble that was due to collapse sooner or later, and that its collapse would likely cause a recession. Yes, he said it every year. And CNBC was insulting and mocking him every step of the way. I guess he can take his Nobel Prize to the bank.
Darn right Reagan had deficits. he wasn't perfect, but hey, he also wanted to spend Russia into the ground, because he knew the American economic system could survive---check and mate, on that count.
Clinton didn't do anything economically bad. But remember Clinton couldn't enact his grand social policy (with all its attendant costs) because th '94 Republican Congress took over--suspiciously at the beginning of the 90's boom. And they began to push for less spending and welfare reform. But that's too convenient for my arguments, I know.
Bush really had no excuse for his deficts from a conservative perspective. Many conservatives have been upset with his policies, precisely because they have encouraged greater spending. He cut taxes pro-forma, but didn't cut spending as well.
"I'd say the forecast had more to do with the poor earnings reports and projected layoffs than anything Obama claimed."
---perhaps, RG, perhaps. But I would argue Obama's/Congresses interventionist and social welfare policies are driving some of those numbers. After all, if you predict higher taxes and higher regulation, you might have to cut staff and lower earnings to pay for them.
"I would argue Obama's/Congresses interventionist and social welfare policies are driving some of those numbers. After all, if you predict higher taxes and higher regulation, you might have to cut staff and lower earnings to pay for them."
Yes, that's *clearly* it. Talk of letting the marginal tax rate for personal income over 250k go from 36% back to 39% in 2010 is causing people to cut staff now.
They're not touching your precious 15% capital gains rate, as much as I wish they would. As for EFCA making Walmart shit their pants, I can't really say I pity them all that much.
RG: "But did you consider Sowell's leanings when reading his criticism of FDR?"
I did. The difference is one of perspective: Sowell was looking back on a historical event, using all the facts available. Krugman was making future predictions, and strangely was more pro-despair the more Republicans were in power.
Certainly Sowell is influenced by his politics. But this is about prediction, not looking back. Krugman has long been calling for failures/recession, and yet you give him a pass for his wrong prediction before. Kudlow makes a bad one, and you're all over him. C'mon: fair is fair here. Either cut Kudlow some slack or give Krugman a lot more criticism. Either is fine by me.
"It's an ultra-rightwing money channel. The two are not exclusive. Kudlow is not respected by anyone outside of the far right, in large part because he's made hilariously wrong calls on almost everything of note. You would be unaware of this because you apparently think everyone who disagrees with you is a socialist."
----Yes, Adam, in your own little world, no one to the right of Karl Marx is allowed to speak on economics, and Larry Kudlow, a former Staff Economist to the Fed, formerly on the boards of major financial institutition, is unfit to tie his shoelaces and roundly mocked by you and your hipster friends in Brooklyn. I get it, you're a moron.
"Krugman, on the other hand, had been roundly criticized merely for *saying* that there was a housing bubble that was due to collapse sooner or later, and that its collapse would likely cause a recession. Yes, he said it every year. And CNBC was insulting and mocking him every step of the way. I guess he can take his Nobel Prize to the bank."
---Yes, roundly criticized by some of those right-wingers for saying that an economic cylce will end---how brilliant of him! How could he have ever forseen a market cycle ending! But without any dates given! What a cushy thing to say---eventually, he'll be right.
*shakes head at Adam ruefully*
Adam: "Yes, that's *clearly* it. Talk of letting the marginal tax rate for personal income over 250k go from 36% back to 39% in 2010 is causing people to cut staff now."
---Let's not forget the increased regulation,
the corruption bred by the Democratic Congress in resisting reform to Social Security which will now be fixed by higher taxes;
Fannie Mae, and Freddie Mac, which were democrat-run and will now be free to be corrupt some more;
the raising of taxes on corporations to pay for the social engineering (by any means necessary!) you baby killers so dearly love.
And, yes, a higher tax rate on the wealthy.
Yes, this will *never* affect market prediction. uh-uh. Don't you know Adamspeak?
"Yes, roundly criticized by some of those right-wingers for saying that an economic cylce will end---how brilliant of him! How could he have ever forseen a market cycle ending!"
I know that was tongue-in-cheek, but, well, a lot of people didn't. Especially people on the far right like Kudlow. You remember the Dow 36,000 crew? He wasn't criticized for saying a cycle would end; he was criticized for saying housing was in a bubble. That's a big distinction. They mocked him because he said houses were worth more than they should have been, because they honestly all thought houses were worth that much and would continue to increase in value every year and ridiculed anyone who said otherwise.
Um, Adam---here's a clue. Housing bubble===top of market cycle.
And for you to generalize and say "all of CNBC" was saying houses would always rise is the typical glib assertion I've come to expect of left-wingers who drink Pabst Blue Ribbon.
Someone please take over spanking wittle Adam here. Don't worry about his Adamspeak Marxism, he doesn't understand it himself.
I'm out.
Cycles decline. Bubbles pop. There's a pretty big difference, as anyone who was a multi-millionnaire in 1999 and broke in 2001 could tell you. And yes, a certain large portion of right-wing economists were quite certain housing was in no way a bubble and would in no way decline. But I'm sure you know that, you're just being disingenuous as usual.
Good day.
No, I don't think your crazy. The more the FED does the more it looks analogous to what was done in the Great Depression. And that really bothers me. Housing here in FL is crippled big time. It's mind numbing to me how many foreclosures there's been just in my neighborhood. Let alone how many store fronts are beginning to empty out.
I'm worried too about gold. I've seen talk elsewhere that maybe a gold standard would be set to the dollar or an entirely new currency like an Amero. Right now, looking at ExactPrice, gold is trading at $840.60 and I'm surprised it's not higher. Some think if a gold standard was set it might be as high as $9,000. Not that I don't like the idea of a gold standard, I do, but back then there was a confiscation of gold. So I wonder if that might not happen again.
What ever happens, we are living in some interesting times.
Re recession metrics:
Guys, the definition of recession is currently undergoing a shift from the classic term (two successive GDP drops) to one that incorporates other variables. Why all the fury over a pretty trivial matter?
Krugman v. Sowell:
As someone who respects both Krugman (pre-NYTs lunatic, anyway) and Sowell (pre-dotage, anyway), I would say the difference between the two is that Sowell's economics influenced his political polemics, whereas Krugman's politics influenced his economics. Both men did earlier work in their careers I find worth reading. That worthwhile work lessened in frequency as their respective careers went on, and each are now at a point where they are rambling, raving bag ladies. Why people bother reading their op ed stuff, I am unsure.
Sowell was the deeper, more profound, thinker of the two, though, regardless of what the Swedes say. Krugman was elegant, slick and well-packaged in a way the more ruminative, slowly-unfolding Sowell was not.
And for those who like to cite Krugman's Nobel as if that means he is god-like, there is this great school in Chicago that has an economics department filled with a rich history of Nobel winning. Many of those Nobel-toting guys would tell you Krugman's op-ed stuff is wank toss and should be ignored. That does not end the debate,of course, but it does end any notion, I hope, that if a person wins a Nobel, their op-ed political rants and SWAG prognostications must be taken seriously. Judge his arguments on their merits, not the mouth out of which they come.
Adam:
"And yes, a certain large portion of right-wing economists were quite certain housing was in no way a bubble and would in no way decline."
Name five. Should be easy, I think, given Google exists. Me? I cannot name one off the top of my head, although I confess to not knowing what makes an economist "right wing".
"Kudlow is not respected by anyone outside of the far right, in large part because he's made hilariously wrong calls on almost everything of note."
Not just wrong, but *hilariously* wrong on almost "everything of note"? Again, name five instance.
You can have strong opinions, but factual claims require facts.
Megan, I think your right. It's kind of like a broken window fallacy. Such a policy will create imaginary warning signs on houses:
Warning. Price protected by the U.S. government Barnie Frank and Magic. price will not tranish unles we lose interest or (too much) money. Don't worry; we'll correct your ballots for you. Party on. Democratic party.
This determination actually happened years ago; iirc, there were never two successive quarters of negative growth in the '01 recession. I would wager that very few people would argue that there was not, in fact a recession during that time.
Let me see this again: I am very glad that Basic posts as a supposed 'conservative', and not as something else.
Ummm... Would anyone care for some decaf?
FDR is getting a bit of a bad rap: hindsight is 20/20. At the time, nobody understood why the collapse had been so total, or what to do about it.
On the gold market manipulation strategy, the lunatic who Megan criticizes was Irving Fisher of Yale, the leading U.S. economist of the day. FDR was extremely skeptical, but he figured he'd give it a try. They gave up after a few months when it didn't work.
Megan also criticizes the NRA's attempt to cartelize the economy. The NRA was inspired by the successful War Industries Board, which ran the U.S. economy during World War I. A war boom is different from a deflationary bust, but central planning also appeared to be working in Russia (thank you, NYT Pulitzer Prize winner & Stalin apologist Walter Duranty) and was in vogue, so it wasn't crazy to try it.
The economy was rapidly growing during the period the NRA was active (the NRA had more or less collapsed by the end of 1934, then was declared unconstitutional in mid-1935), so while it was a bad idea in hindsight, it's hard to see how it did gigantic damage. The only effective part of the NIRA (the authorizing statute) was Section 7, which gave labor unions the right to organize, and was the predecessor of the Wagner Act.
We are, right now, at a moment of maximum policy uncertainty. How will banking regulation change? How will hedge funds be regulated? What industries/locations/businesses will get the money for the fiscal stimulus? How will the money be allocated? What will the rules be for trading securities? How much leverage can you take? How will the regulators evaluate risk? What will tax rates be?
All this policy uncertainty is causing people to wait to commit resources.
My hope is that once we have a new President and Congress in place, we can reduce all this policy unertainty, and maybe things will get closer to normal.
A fear I have is that by 'trying everything,' and not giving things time to work out, no will will know the new rules. In that case, people will keep waiting, and waiting, and waiting...
We need rules, and commitments to those rules.
A few years ago AER surveyed economists world-wide to see what they agree and disagree on.
The one thing they most agreed upon was that "price fixing doesn't work", it always makes things worse, particularly in regard to housing (rent controls, etc.).
So now here are all the proposals to price-fix the housing market. If tried at best they will be an expensive total failure, at worst they will be an expensive partial failure that cause house prices to move more slowly downward toward their real value, causing the weak housing market to drag on for years, making everything worse for longer.
Today's recession-causing systemic financial problems are hugely larger than the US housing market -- Iceland being bankrupt and Russia's riots aren't because they overinvested in US mortgages. The mortgage problems may have triggered the crisis, but we're way beyond that now. Mortgages aren't going to fix the crisis, even in dreams.
the NRA had more or less collapsed by the end of 1934, then was declared unconstitutional in mid-1935), so while it was a bad idea in hindsight, it's hard to see how it did gigantic damage.
The NRA policies had major effects long after the NRA itself was repealed dejure -- FDR continued them for years defacto, supporting industrial concentration, collusion exempt from anti-trust, minimum price policies and such, causing prices and wages (among the lucky employed) to rise up to 25% above the market-clearing rates.
E.g.:
http://newsroom.ucla.edu/portal/ucla/FDR-s-Policies-Prolonged-Depression-5409.aspx
Intersestingly, Canada during the Depression suffered a bigger initial decline than the U.S., but had a much faster recovery of employment.
And there was no New Deal in Canada, as efforts to impose New Deal-type policies there were politically defeated by the same forces that were dubbed "reactionary" in the US, over which FDR had triumphed with the result of this court-packing efforts et. al.
Sort of an interesting natural experiment.
I don't understand why everyone (ok you and reason) are hating on the TVA this week. Along with the more general REA, the two may be the most significant and long term beneficial programs of the New Deal outside the banking and financial sectors.
Odd comments:
Megan, I always recommend to bloggers never to set a question up so that someone thinks they can "win" an argument on the Internet. You can't do that, except in your own mind. Asking open-ended questions on a highly contentious topic leads to just such exchanges as we saw between Adam and some pseudonym. None of it means anything. Of course, you have a right to play host to pages of meaningless invective, and if you don't want me to read your blog, you may feel free to do so.
On housing: I'd say let the prices go, except for one factor I've not seen (in an admittedly cursory reading) here. Houses currently exist on the ground. Maybe those houses shouldn't exist in their current form, but that doesn't change the reality that they do. Abandoning them would lead to their destruction at the hands of metal scavengers, a great waste of value. I don't know what, if any, solution exists for this; I would love to see a creative one. But economic theories have consequences in the real world, and ideally those consequences would include some method of preserving existing value where possible.
John S:
"...leads to just such exchanges as we saw between Adam and some pseudonym."
You have proof that 'Adam' is the poster's real name?
:-)
I agree with notsure: the rules of the game need to stop changing.
It would be nice if we had good rules that encouraged investment and productivity, but even bad rules are better than changing rules. We'll figure out a way to work around bad rules.
If the technocrats figured out a sure-fire way to prop up housing prices (is there such a way?) and then STUCK TO IT, that would help get us out of our current mess. And probably cause unintended consequences a dozen years from now that nobody was able to predict...
If you cared about the reality of housing bubbles and cycles in the housing market and the real economy, then you would look at UK data. As far as I can tell, since at least the time of Thatcher, the goal of Britons' lives have been to be involved in property speculation and housing ownership.
SoV: "This determination actually happened years ago"
---As always, SoV, a citation (by you) would be nice.
And please: if "everyone agrees" (everyone being Adam, RG, and you right now), why is Bloomberg, the major source of data for multitudes of financial people and economists, defining it differently?
Put it this way: I am very happy SoV is a left-wing nut; makes me ever more so secure that socialism is not the way to go.
Why do I ever make the mistake of reading Megan McCardle. She's a mouthpiece for the failed policies that have brought us to this pass. She wants more of the same sort of ideological blindness to consequences and reverence bootlicking for the wealthy. Seriously, if wall street's thieves sold their poop, she would buy it and serve it to her family for supper.
So Irving Fisher is known for something else except his permanently high plateau? Wow, what a legacy. Poor guy.
RuthaLice, do at least pay some minimal attention to the name of the blogger you so hate. Dear god.
Re: the corruption bred by the Democratic Congress in resisting reform to Social Security which will now be fixed by higher taxes;
I assume that by "Democratic Congress" you mean the Congress of 2007-2008. Exactly what Social Security reform plan was introduced into that Congress?
"But it's something to worry about that no one I see is much worried about. A lot of people are grousing that it won't work, but very few are complaining that the act of propping up prices might, by itself, worsen the housing market and the general economy."
I call bullshit. Haven't you read anything by the Austrian economists? Of course it's going to make things worse. Of course people are grousing about this. Go visit mises.org