"Econotron" <njmfis-1@[EMAIL PROTECTED]
> wrote in message
news:jmHBj.6270$e52.6175@[EMAIL PROTECTED]
> "John Galt" <whoisjohngalt@[EMAIL PROTECTED]
> wrote in message
> news:IiHBj.68839$Gv.41834@[EMAIL PROTECTED]
>>
>> "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?
>>
> I am saying that they did, and it was the right thing to do.
Apparently we agree, since they did in fact tighten, and it did in fact
lead
into Depression.
JG
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