"Econotron" <njmfis-1@[EMAIL PROTECTED]
> wrote in message
news:KNHBj.6273$e52.6256@[EMAIL PROTECTED]
> "John Galt" <whoisjohngalt@[EMAIL PROTECTED]
> wrote in message
> news:StHBj.82348$ng7.41418@[EMAIL PROTECTED]
>>
>> "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.
>>
> We certainly do, up to that point. But I suspect that our opinions may
> diverge, when dealing with desirability of the depression.:-)
Not surprising, since I was raised by people who lived through it.
JG
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