"Econotron" <njmfis-1@[EMAIL PROTECTED]
> wrote in message
news:COGBj.7587$y83.7323@[EMAIL PROTECTED]
> "John Galt" <whoisjohngalt@[EMAIL PROTECTED]
> wrote in message
> news:16DBj.70348$6i4.24471@[EMAIL PROTECTED]
>> John Galt:
>> "Christopher Helms" <Chrishelms132@[EMAIL PROTECTED]
> wrote in message
>>
news:1a1d7aef-1c8c-49d4-bee5-e5b506ff87c9@[EMAIL PROTECTED]
>> On Mar 11, 3:46 pm, stuff_st...@[EMAIL PROTECTED]
wrote:
>>> On Tue, 11 Mar 2008 13:30:17 -0700 (PDT), perrie
>>>
>>> <perryneh...@[EMAIL PROTECTED]
> wrote:
>>> >We'll see if it continues tomorrow, won't we?
>>>
>>> http://biz.yahoo.com/ap/080311/wall_street.html
>>>
>>> Dow Jumps More Than 400 Points After Fed, Other Central Banks Move to
>>> Ease Credit Crisis
>>>
>>> NEW YORK (AP) -- Wall Street finally found a reason for a huge
>>> rally>Tuesday, after the Federal Reserve said it plans to pump $200
>>> billion
>>>
>>> into the financial markets to help ease the strain from the credit
>>> crisis. The Dow Jones industrial average shot up more than 416 points,
>>> its biggest one-day point gain since July 24, 2002.
>>>
>>> The Fed's program is part of a worldwide effort to help struggling
>>> banks and mortgage providers. The Fed -- acting in concert with the
>>> European Central Bank, the Bank of Canada and the Swiss National Bank
>>> -- agreed to loan investment banks money in exchange for debt,
>>> including slumping mortgage-backed securities.
>>>
>>> The move is meant to essentially create a market for assets that
>>> investors have been too scared to buy. That freeze-up in demand had
>>> sent asset values plunging and caused huge losses for some of the
>>> world's biggest banks.
>>> .. .
>>>
>>> "It's not just a rate cut. I think it's a very creative way to do
>>> financing," Conroy said. "It shows the Fed is willing to do things
>>> that are a little out-of-the-box to shore up credit issues. I really
>>> think they went to the heart of the issue."
>>>
>>> **** - a $200 billion bailout? Who's going to get the tab for this?
>>>
>>> And why is the fed saving the markets? It's charter is to manage
>>> employment and inflation.
>>
>>
>> The Fed isn't saving the markets. It is saving the banks, or trying to
>> by continuing to flood the banking system with extremely cheap,
>> inflationary dollars. The idea is to get the banks to start loaning
>> money again. The banks who the Bush administration has been taking a
>> 1920s, Calvin Coolidge style approach to. Like in the 1920s, the Bush
>> administration allowed the banks to run free, free, free. They
>> encouraged the Fed to pursue a loose money/ cheap credit policy just
>> like in the 1920s. Hell, they even wanted the banks to be allowed to
>> start playing the stock market again. Then, just like in the 1920s,
>> the banks went overboard, over extended themselves and got into
>> trouble. In the 1920s it was loaning easy money to stupid people so
>> they could buy stocks they couldn't afford on huge margins. You were
>> fine as long as your stock kept going up, which it failed to do around
>> October of 1929. The loans went bad and the banks got stuck when the
>> market corrected and suckers-I mean investors- suddenly couldn't make
>> margin calls. This time it was loaning money to stupid people to buy
>> houses that they couldn't afford. The loans were fine as long as the
>> housing market kept going up, which it failed to do. People suddenly
>> owed more on their houses then the houses were worth. Then, just like
>> in the 1920s, the banks went almost overnight from a loose, easy
>> credit stance to an almost no credit stance. They got stuck with all
>> sorts of bad debt and the proud, mature, independent, lassais faire
>> banks went crying to the government to bail them out as though the
>> taxpayers had some fiduciary responsibility for the well being of the
>> banking industry. **** the banking industry. They got themselves into
>> this mess, they can get themselves out. That's the position an actual
>> conservative would take. "Oh, the government must help or some of the
>> nations biggest banks will fail." Good. Let them fail. It will be a
>> lesson to the others the next time they start getting all tingly in
>> the crotch about giving credit to morons just because some brain dead
>> administration thinks it's the right, conservative thing to do.
>>
>> ***
>> In 1929, the Fed attempted a TIGHT money policy after the October
>> correction, an action which is generally considered to (along with some
>> other poorly thought out goverment policies) have turned a necessary
>> correction into a full blown Depression.
>>
>> What the Fed is doing now and what they did then could not be more
>> different.
>>
>>
> That is according to the self-serving monetarist fairy tail.
Are you saying that the Fed did *not* tighten money supply in 1929?
JG
> The Fed in 1929 did the right thing, killing the vicious inflation cycle
> in its inception. The depression was the price to pay, but the price for
> the prior excesses. They had very fresh example then of the runaway
> inflation in Germany that lately brought Hitler to power with
devastating
> consequences, compared to which the Great Depression looked like a Great
> Boom. You can see today how credit expansion is spinning out of control,
> first Greenspan, and the following attempt to contain the prices by half
> measures simply collapsing. It is scary, and nobody has guts today to
> arrest that trend.
> e.
>
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