United States Heading towards a Depression?

Care to name any free market-ish, capitalistic societies where people live off less than $2 per day?

On the contrary, I think it is important to point out that socialism impoverishes and fails people on a mass scale. Governments are incapable of simulating the aggregate of market decisions made by thousands or millions of independent actors.

 

I'm no big fan of democracy.

However, fascism is not a free market, and capitalism as we use it, implies a free-er market, however most people will just assume it is at best, the private ownership of the means of production, or at worst, corporatist fascism.

 

Fact: all member countries of the OECD (with the possible exception of Hong Kong) combine aspects of capitalism and socialism. I'm not saying that this is good or bad. You can't attribute the wealth of these countries solely to capitalism and a free market. Free market is virtually a misnomer. Even Hong Kong is only free marke-tish.

Many of the richest European countries in the OECD have a more socialist leaning than anything else. Even the US has a lot of socialist aspects to its system.

Thing you own your house?

Try not paying property taxes and see how long it takes for your state government to come along and auction it off. You never truly own your property. It's only yours as long as you give money to the government. And you have to keep giving money to the government for ever.

Don't want to pay income taxes?

See how long you last before you go to jail.

Countries which you may define as socialist such as India include populations that live on less than $2 per day also have self made capitalists worth billions who have made their money astutely. It presupposes the right to private property and the exploitation of capital.

If you take a look at the US in the 1800's and China for the last 20 years they have four things in common. Foreign investment, cheap labor, the exploitation of natural resources, and importantly, a sustained focused effort in developing quality infrastructure.

China is not a definitively free market or capitalist country. Sure it has aspects of these economic systems, but it's run by dictators at the top level where the face of the mother land is everything. At the provincial level its run by corrupt bureaucrats.

In China private property isn't worth a damn if its in the way of some provincial or state government project which lines some bureaucrats pocket. Your home is taken and you provided with some kind of token compensation in return.

 

Oh boy. You're really gonna get him started now.

 

Hon Daddy Dad, I know. But the system is not sustainable. The only reason why western mixed economies have survived this far, is due to the transfer of wealth and exploitation of Asian economies. It's a charade, and the banking system is geared to keep the ponzi scheme rolling.

It's great you can identify all of the injustices. Are you doing anything about it?

Yeah I know. Rotten deal. If you aren't a good slave, they will taser, kidnap and incarcerate you in a rape room. Gotta love my government! Always watching my ass. Literally.

POW-EEEEER TO THE PEEEEE POOOOOLE! FREEEDOM! DEMOCRACY! YES WE CAN! CHANGE! wooohooo!

 

Lehman warns Freddie Mac and Fannie Mae, could have to raise a combined 75 billion dollars in fresh cash to meet their commitments.

Forclosures were 1.5 million in 2007 and 2.5 million more are expected in 2008.

 

700 billion dollars leave the US every year. That's 4x the cost of the Iraq war.

 

Where do they go? What will happen if they come back?

 

China, Japan and Saudi hoard dollars.

Good question about what will happen if they come back. I think the subprime was some of these dollars comong back in the form of investment. So some of these dollars have been erased.

 

Because post-Bretton Woods, the global banking cartel has agreed to continue using US dollars as reserves in foreign banks.

China and Saudia have sovereign wealth funds, for American re-investment.

But make no mistake, there is no mandatory reserve requirement. They can all totally divest any time they choose.

The dollars are not erased in your scenario. They are actually being put back into circulation.

 

China prints tons of money to buy tons of USD to keep their export machine chugging along. Their inflation is stupid high.

 

Saw this on the Mises Blog. Hon Daddy, might be of interest to you if you will be able to watch it.

The People's Republic of Capitalism

 

Freddie and Fannie are in the quick lane to being nationalized. I believe if they fall under $10 for some time some funds will be forced to sell because of it's own fund rules. I think nationalization of these two is pretty much inevitable. They were supposed to provide liquidity to mortgage markets and instead they messed it all up.

 

Interestingly, I've already read it.

 

Meh if bush wasn't elected this never would have happened...

-Chris

 

No. This is a systemic problem with the monetary system and policies.

 

Congress recently allowed Freddie and Fannie to back larger mortgages, up to $729,750 and now they need a bailout

 

Yeah, who woulda guessed that upping the limit would have that effect.

Most people are just stupid cattle. They won't even be taxed for the bailout, they just will be bled off with inflation.

 

The bailout was like handing out some crack in a bad neighborhood. It didn't take very long for the shit to get smoked up and people are back looking for some more. The second housing bailout is being held up but it's sure to make things worse.