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SirTripAlot
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Bailouts a form of Socialism?
#8671187 - 07/23/08 10:42 AM (15 years, 8 months ago) |
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One of the foundations of America's free enterprises system relies on the fact that incentive and profit will drive a market.
Mostly, government intervention and restrictions (i.e.taxes) are thought to bottleneck or subdue a market more once they are implemented.Another concept of our market, is that failure, breeds success and will correct the marketplace from time to time.
So my question is: Why is our government bailing out (intervening)our financial markets? (ala Fanny May & Freddy Mac)
Does this not violate the very fundamental principle of the market itself? Why are the big corporations all to eager in taking money from the Feds, yet decry any restriction put on them by the government?
Does this not blur the line into a state ownership of an economy ( a form of economic socialism?)
-------------------- “I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when it has gone past I will turn the inner eye to see its path. Where the fear has gone there will be nothing. Only I will remain.”
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johnm214
Registered: 05/31/07
Posts: 17,582
Loc: Americas
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Re: Bailouts a form of Socialism? [Re: SirTripAlot]
#8671259 - 07/23/08 11:05 AM (15 years, 8 months ago) |
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I think of it as corpratism, but I guess its pretty much socialism as well...
Bad deal, in my opinion. Let the inefficient companies fail, and the efficient will prosper.
I just heard bush is reversing course, and now he'll sign the bailout.
What a twerp!
What good is this guy? I at least had some hope he'd take a principled stand, but looks like he won't now.
He should reject that shit and make them override his veto.
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GnosticWarrior
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Re: Bailouts a form of Socialism? [Re: SirTripAlot]
#8671404 - 07/23/08 11:40 AM (15 years, 8 months ago) |
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That's exactly what Jim Rogers called it. Socialism, not Capitalism.
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Minstrel
Man of Science
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"Welfare for the rich." -J Rogers
Fucking spot on.
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SlashOZ
:D
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Posts: 3,557
Loc: Following the water cycle
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Re: Bailouts a form of Socialism? [Re: SirTripAlot]
#8671599 - 07/23/08 12:29 PM (15 years, 8 months ago) |
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bailing out freddie and fannie is housing socialism imo. if you get a loan and you can't pay it back then tough shit. you shouldn't have written a check your ass can't cash ffs. same with freddie and fannie. i guess this is what we get when we have huge financial institutions that have connections all over washington dc. bad business practices mean a company should go out of business not get a government bailout. i don't give a shit about people losing their houses and the government shouldn't either.
-------------------- "Life sucks but in this really beautiful way" - Axl Rose "Life's a bitch and then you die that's why we get high cuz you never know when you're gonna go." - NAS "When people don't know what you're about they put you down and shut you out" - Black Sabbath "An eye for an eye makes the whole world blind" - Gandhi "Look up at me I am God, look down on me and I am evil, look at me I am you." - Charles Manson. "Don't question my reality." - Me (as far as I know)
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bluegold
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Re: Bailouts a form of Socialism? [Re: SlashOZ]
#8671683 - 07/23/08 12:44 PM (15 years, 8 months ago) |
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I find it very funny that our government continues to bailout these large failed companies with our money. The whole point of a free market is to allow the market to decide what happens not the Federal government. How can we ever improve the system if the federal government makers sure that same decision makes stay in power. The banking industry has to much possible revenue involved to allow such bailouts. Once this bank goes under the next in line will step up to take over the system. Like the drug industry, take out one cell and there are ten others waiting to fill the void. If a black market system can maintain its profit margins while the federal government spends billions trying to stop it, I am pretty sure the banking industry will continue.
Edited by bluegold (07/23/08 12:48 PM)
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Seuss
Error: divide byzero
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Re: Bailouts a form of Socialism? [Re: SlashOZ]
#8671689 - 07/23/08 12:45 PM (15 years, 8 months ago) |
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> bailing out freddie and fannie is housing socialism imo.
I have no problem with bailouts, but I think the money for the bailout should come from the people that were running/profiting from the company rather than from the taxpayer. If they have no money to give, then there are plenty of prison labor camps that have extra beds.
-------------------- Just another spore in the wind.
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SlashOZ
:D
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Re: Bailouts a form of Socialism? [Re: Seuss]
#8671715 - 07/23/08 12:50 PM (15 years, 8 months ago) |
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if the government ponies up billions to freddie and fannie so people dont' default on their loans then that is housing socialism plane as day.
-------------------- "Life sucks but in this really beautiful way" - Axl Rose "Life's a bitch and then you die that's why we get high cuz you never know when you're gonna go." - NAS "When people don't know what you're about they put you down and shut you out" - Black Sabbath "An eye for an eye makes the whole world blind" - Gandhi "Look up at me I am God, look down on me and I am evil, look at me I am you." - Charles Manson. "Don't question my reality." - Me (as far as I know)
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Phred
Fred's son
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Re: Bailouts a form of Socialism? [Re: SirTripAlot]
#8671782 - 07/23/08 01:10 PM (15 years, 8 months ago) |
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It may not technically be Socialism - Socialism technically speaking describes a political system in which a society's industry is owned not privately (by families or groups of shareholders) but collectively (i.e. state-owned shipyards and oil companies, etc.) - but more like Welfare Statism or Nanny Statism. However, with today's sloppy usage of political terms, no one will give you too much grief for calling the bailout a socialist move.
No matter what you call it, it is certainly not free enterprise, and runs contrary to the Capitalist ethos. But - as I've pointed out repeatedly over my time here - the United States is not Capitalist, and hasn't been for a very long time now.
Phred
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zappaisgod
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Re: Bailouts a form of Socialism? [Re: Seuss]
#8672065 - 07/23/08 02:15 PM (15 years, 8 months ago) |
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Quote:
Seuss said: > bailing out freddie and fannie is housing socialism imo.
I have no problem with bailouts, but I think the money for the bailout should come from the people that were running/profiting from the company rather than from the taxpayer. If they have no money to give, then there are plenty of prison labor camps that have extra beds.
I know you aren't advocating debtors' prisons, because that would mean the assholes who borrowed money and didn't pay it back would be on chain gangs. I think the bailout money should come from the losers who took the loans. Shake 'em 'til they bleed from their ears.
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Shins
Fun guy
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Posts: 16,337
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Re: Bailouts a form of Socialism? [Re: SirTripAlot]
#8673198 - 07/23/08 06:56 PM (15 years, 8 months ago) |
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but isn't it also the lenders' fault for giving out loans to people who cant pay it back?
either way, taxpayers should not have to take the burden.
Edited by Shins (07/23/08 06:57 PM)
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SirTripAlot
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Re: Bailouts a form of Socialism? [Re: Phred]
#8674428 - 07/23/08 11:46 PM (15 years, 8 months ago) |
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Phred, could you please give a name to the current system we employ?
When ,historically, did this shift away from capitalism occur?
-------------------- “I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when it has gone past I will turn the inner eye to see its path. Where the fear has gone there will be nothing. Only I will remain.”
Edited by SirTripAlot (07/24/08 07:40 AM)
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Libertine
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Re: Bailouts a form of Socialism? [Re: SirTripAlot]
#8674458 - 07/23/08 11:55 PM (15 years, 8 months ago) |
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Yes it is socialism. It is definitely welfare...corporate welfare. Instead of helping out people with very little we make sure that those who have the most keep theirs. Free Market Socialism has replaced Capitalism.
-------------------- A mind is a terrible thing to taste...hehehe.
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Minstrel
Man of Science
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Re: Bailouts a form of Socialism? [Re: Libertine]
#8675463 - 07/24/08 07:50 AM (15 years, 8 months ago) |
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Wasn't the purpose of the Fed to DO EXACTLY THIS (bailout), in the event in which smaller banks become insolvent or runs on the bank?
If a small bank can't cover the (fractional) reserve for all the money they lent away, the Fed, being the central bank, will loan the cash so as to not start a panic.
Someone please correct me if I'm wrong, but isn't that the way the central bank was designed to function? Wasn't it spawned by that need back in 1913?
Didn't Woody Wilson come to regret it, because it was essentially the death of the free market?
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SlashOZ
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Re: Bailouts a form of Socialism? [Re: Minstrel]
#8675935 - 07/24/08 11:16 AM (15 years, 8 months ago) |
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the federal reserve prints money and controls interest rates. thats all it does.
the federal deposit insurance corporation or FDIC is the one that insures all bank deposits up to 100,000 dollars.
the runs on the bank during the great depression were because the stock market crashed and there were millions of dollars that were loaned out by banks that were lost in the stock market when it crashed.
the loans today were for houses. so the capital is still there in the form of a house. the bank just repos the house and sells it at auction or puts it back onto the market. runs on the bank today probably won't happen on a wide scale because of the difference in the situation.
-------------------- "Life sucks but in this really beautiful way" - Axl Rose "Life's a bitch and then you die that's why we get high cuz you never know when you're gonna go." - NAS "When people don't know what you're about they put you down and shut you out" - Black Sabbath "An eye for an eye makes the whole world blind" - Gandhi "Look up at me I am God, look down on me and I am evil, look at me I am you." - Charles Manson. "Don't question my reality." - Me (as far as I know)
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GnosticWarrior
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Re: Bailouts a form of Socialism? [Re: SlashOZ]
#8676525 - 07/24/08 02:15 PM (15 years, 8 months ago) |
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From what I understand and what Warren Buffett says, it may have been right for the Fed to bail out Bear Stearns. It's a very large investment bank and the bail out is what the Fed is for.
http://www.reuters.com/article/businessNews/idUSN0330068120080503
But Fannie and Freddie are not banks. According to Wikipedia- http://en.wikipedia.org/wiki/Fannie_mae
Quote:
Fannie Mae was founded as a government agency in 1938 as part of Franklin Delano Roosevelt's New Deal to provide liquidity to the mortgage market. For the next 30 years, Fannie Mae held a virtual monopoly on the secondary mortgage market in the United States.
In 1968, to remove the activity of Fannie Mae from the annual balance sheet of the federal budget, it was converted into a private corporation.[8] Fannie Mae ceased to be the guarantor of government-issued mortgages, and that responsibility was transferred to the new Government National Mortgage Association (Ginnie Mae).
I take it that Fannie's move into a private corporation was to transfer risk from the Govt. onto the shareholders. That is why there should be no bail out of Fannie or Freddie. The govt. was not getting a piece of the profits during the good times that the shareholder were, so they should have to eat the loss too.
Edited by GnosticWarrior (07/24/08 02:17 PM)
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zappaisgod
horrid asshole
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I'm not exactly sure Bear Stearns got a bailout at any gummint expense. JP Morgan bought them at firesale rates and most of their employees lost their jobs and all of their shareholders lost most of their money. So? I'm also not sure that anything related to Freddy and Fanny will ever cost any taxpayer any money. We'll see on that one. Don't forget, even if your asset depreciates below the value of the loan you acquired to procure it, YOU are still the responsible party. The entire loan mess is due to assholes who won't meet their obligations. I don't recall any gunpoint loans.
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Daishi
Prime Mover
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Re: Bailouts a form of Socialism? [Re: zappaisgod]
#8676657 - 07/24/08 02:52 PM (15 years, 8 months ago) |
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Quote:
zappaisgod said: I'm not exactly sure Bear Stearns got a bailout at any gummint expense. JP Morgan bought them at firesale rates and most of their employees lost their jobs and all of their shareholders lost most of their money. So? I'm also not sure that anything related to Freddy and Fanny will ever cost any taxpayer any money. We'll see on that one. Don't forget, even if your asset depreciates below the value of the loan you acquired to procure it, YOU are still the responsible party. The entire loan mess is due to assholes who won't meet their obligations. I don't recall any gunpoint loans.
I can't understand what you are typing. Is English your first language?
In any case I believe you deserve some sort of prize for that caliber of incoherent dishonesty. Perhaps it can be delivered to your door step personally.
-------------------- Man has to be man--by choice; he has to hold his life as a value--by choice; he has to learn to sustain it--by choice; he has to discover the values it requires and practice his virtues—-by choice. A code of values accepted by choice is a code of morality.”-- Ayn Rand, Atlas Shrugged
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SlashOZ
:D
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Posts: 3,557
Loc: Following the water cycle
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Re: Bailouts a form of Socialism? [Re: Daishi]
#8676814 - 07/24/08 03:29 PM (15 years, 8 months ago) |
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Quote:
Daishi said:
Quote:
zappaisgod said: I'm not exactly sure Bear Stearns got a bailout at any gummint expense. JP Morgan bought them at firesale rates and most of their employees lost their jobs and all of their shareholders lost most of their money. So? I'm also not sure that anything related to Freddy and Fanny will ever cost any taxpayer any money. We'll see on that one. Don't forget, even if your asset depreciates below the value of the loan you acquired to procure it, YOU are still the responsible party. The entire loan mess is due to assholes who won't meet their obligations. I don't recall any gunpoint loans.
I can't understand what you are typing. Is English your first language?
In any case I believe you deserve some sort of prize for that caliber of incoherent dishonesty. Perhaps it can be delivered to your door step personally.
now now zappa is actually right on this one.
-------------------- "Life sucks but in this really beautiful way" - Axl Rose "Life's a bitch and then you die that's why we get high cuz you never know when you're gonna go." - NAS "When people don't know what you're about they put you down and shut you out" - Black Sabbath "An eye for an eye makes the whole world blind" - Gandhi "Look up at me I am God, look down on me and I am evil, look at me I am you." - Charles Manson. "Don't question my reality." - Me (as far as I know)
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Daishi
Prime Mover
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Re: Bailouts a form of Socialism? [Re: SlashOZ]
#8676825 - 07/24/08 03:31 PM (15 years, 8 months ago) |
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Quote:
SlashOZ said:
Quote:
Daishi said:
Quote:
zappaisgod said: I'm not exactly sure Bear Stearns got a bailout at any gummint expense. JP Morgan bought them at firesale rates and most of their employees lost their jobs and all of their shareholders lost most of their money. So? I'm also not sure that anything related to Freddy and Fanny will ever cost any taxpayer any money. We'll see on that one. Don't forget, even if your asset depreciates below the value of the loan you acquired to procure it, YOU are still the responsible party. The entire loan mess is due to assholes who won't meet their obligations. I don't recall any gunpoint loans.
I can't understand what you are typing. Is English your first language?
In any case I believe you deserve some sort of prize for that caliber of incoherent dishonesty. Perhaps it can be delivered to your door step personally.
now now zappa is actually right on this one.
MWAHAHAHAHA! Then he should have taken an extra minute to make it legible. Too bad for him, such a waste.
-------------------- Man has to be man--by choice; he has to hold his life as a value--by choice; he has to learn to sustain it--by choice; he has to discover the values it requires and practice his virtues—-by choice. A code of values accepted by choice is a code of morality.”-- Ayn Rand, Atlas Shrugged
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zappaisgod
horrid asshole
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Re: Bailouts a form of Socialism? [Re: Daishi]
#8676894 - 07/24/08 03:48 PM (15 years, 8 months ago) |
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Every single one of those is a correct English sentence, except for "So?". Every single one of them expresses a coherent point, as attested to by SlashOZ, who didn't seem to have any problem understanding them. Can you understand this post?
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Daishi
Prime Mover
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Re: Bailouts a form of Socialism? [Re: zappaisgod]
#8676905 - 07/24/08 03:53 PM (15 years, 8 months ago) |
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Quote:
zappaisgod said: Every single one of those is a correct English sentence, except for "So?". Every single one of them expresses a coherent point, as attested to by SlashOZ, who didn't seem to have any problem understanding them. Can you understand this post?
Yet it still doesn't make sense. Perhaps you made up every sentence individually, and forgot about the whole paragraph thing.
-------------------- Man has to be man--by choice; he has to hold his life as a value--by choice; he has to learn to sustain it--by choice; he has to discover the values it requires and practice his virtues—-by choice. A code of values accepted by choice is a code of morality.”-- Ayn Rand, Atlas Shrugged
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zappaisgod
horrid asshole
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Re: Bailouts a form of Socialism? [Re: Daishi]
#8676974 - 07/24/08 04:10 PM (15 years, 8 months ago) |
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Like I said, SlashOZ didn't seem to have any difficulty with it. Back to grade school for you, middle school warrior.
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Daishi
Prime Mover
Registered: 04/07/08
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Re: Bailouts a form of Socialism? [Re: zappaisgod]
#8676982 - 07/24/08 04:12 PM (15 years, 8 months ago) |
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Quote:
zappaisgod said: Like I said, SlashOZ didn't seem to have any difficulty with it. Back to grade school for you, middle school warrior.
Ah but to me it seems that the paragraph was structured poorly i.e. poor general composition. Back to post-graduate school for you, oh wait. =)
-------------------- Man has to be man--by choice; he has to hold his life as a value--by choice; he has to learn to sustain it--by choice; he has to discover the values it requires and practice his virtues—-by choice. A code of values accepted by choice is a code of morality.”-- Ayn Rand, Atlas Shrugged
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zappaisgod
horrid asshole
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Re: Bailouts a form of Socialism? [Re: Daishi]
#8677001 - 07/24/08 04:17 PM (15 years, 8 months ago) |
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Quote:
Daishi said:
Quote:
zappaisgod said: Like I said, SlashOZ didn't seem to have any difficulty with it. Back to grade school for you, middle school warrior.
Ah but to me it seems that the paragraph was structured poorly i.e. poor general composition. Back to post-graduate school for you, oh wait. =)
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Daishi
Prime Mover
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Re: Bailouts a form of Socialism? [Re: zappaisgod]
#8677013 - 07/24/08 04:20 PM (15 years, 8 months ago) |
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Uh oh- smooth operator.
-------------------- Man has to be man--by choice; he has to hold his life as a value--by choice; he has to learn to sustain it--by choice; he has to discover the values it requires and practice his virtues—-by choice. A code of values accepted by choice is a code of morality.”-- Ayn Rand, Atlas Shrugged
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GnosticWarrior
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Re: Bailouts a form of Socialism? [Re: zappaisgod]
#8677389 - 07/24/08 06:23 PM (15 years, 8 months ago) |
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You're right, with Bear Stearns the Fed didn't put up any money...yet. They guaranteed $29 Bn of BS's assets. If it turns out in the end to worth less than $29 Bn, I still wouldn't know if it really costs taxpayers money, but the outcome would not be a positive for taxpayers. Even if it just devalues the USD, it will eventually cost taxpayers money.
The same with the Fannie and Freddie deal. http://uk.reuters.com/article/marketsNewsUS/idUKN2349729720080723?pageNumber=1
Even if its just the Govt. getting an equity stake in those two companies in exchange for a cash infusion, that's not an investment that Warren Buffett would do to enrich the value for Berkshire Hathaway shareholders. If it ends up being a lose money investment, than ultimately it does cost taxpayers money. The cost of govt. is always borne by the taxpayers. No such thing as free money to taxpayers or USD holders, even if the Fed has the power to print all it wants.
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zappaisgod
horrid asshole
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But, all that said and done, it remains to be seen if a single nickel will come from the public tit. I fervently hope not. And I do not favor any loser home(not)owner bailout either. They SHOULD lose title to their houses. They didn't pay for them.
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Libertine
Tarzan...King of Mars
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The American economy... [Re: zappaisgod]
#8677500 - 07/24/08 07:14 PM (15 years, 8 months ago) |
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Privatize the profits and socialize the losses. Rewarding bad/risky behavior by corporations...
-------------------- A mind is a terrible thing to taste...hehehe.
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SirTripAlot
Semper Fidelis
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Re: Bailouts a form of Socialism? [Re: zappaisgod]
#8680168 - 07/25/08 12:05 PM (15 years, 8 months ago) |
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Can I take out a loan....say for a business....then default and the Feds will bail me out? (just in case I need it....)
Please point me in the right direction.
-------------------- “I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when it has gone past I will turn the inner eye to see its path. Where the fear has gone there will be nothing. Only I will remain.”
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Prisoner#1
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Quote:
GnosticWarrior said: But Fannie and Freddie are not banks. According to Wikipedia-
The govt. was not getting a piece of the profits during the good times that the shareholder were, so they should have to eat the loss too.
the government shouldnt be bailing out mortgage lenders anyway, they have a responsibility to their shareholders to provide minimal risk loans with properties as collateral against the loans, default on the loan and the finance company owns it, when mortgage lenders have accepted tons of government (taxpayer) cash to prevent them going under they still own these properties, now when the economy starts to improve where are the properties? still in the ownership of the lenders and no repayment to the money they've taken
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