Warren E. Buffett Thanks 'Uncle Sam'

[JimGant]

And, the bottom line is.....you really think we would now be better-off if the government hadn't taken the actions it did (and which Buffet applauds)? Certainly adding to the deficit causes serious problems. But nowhere near the problems that holding steady, or contracting, fiscal stimulus and the money supply would have caused.

Do you doubt that the Great Depression wouldn't have been so 'great' had Keynesian theory been available -- and applied?

I guess every American should be thanking the Fed for that much needed inflation!

Surely you jest. We're way too close for comfort to the deflation model suffered by Japan. A little inflation would be welcomed.

And for the mods...this subject is somewhat Thai related, since the strengthening baht is a product of the recent US (and European) govt actions (or inactions).

[Chunky1]

the great depression was caused by the federal reserve and the decade long inflationary boom that they created with cheap money (sound familiar?). we then suffered liquidity problems via bank runs and the Fed then didn't provide the liquidity. 2007 wasn't a liquidity crisis, the banks were INSOLVENT.

nothing has been solved. the can has just been kicked down the street at the expense of the tax payers.

read your history. educate yourself to what is actually going on.

[gregb]

And, the bottom line is.....you really think we would now be better-off if the government hadn't taken the actions it did (and which Buffet applauds)?

Depends on how you define "better off" now, doesn't it?

If the government had simply been honest with the American people, admitted we were bankrupt, called home and downsized the military, and started on the hard road to a complete restructuring of America from the bottom up, then many would be destitute, everyone would be angry, but at least everyone would be doing something productive right now. And the pit we are currently digging for ourselves would be filling in rather than deepening.

As it is, what we have is an illusion that we are still wealthy, and we are procrastinating rather than accepting reality.

So you tell me, what did anything the government and the Fed do really help? The big lie is still the big lie, and we are still bankrupt whether or not Warren Buffet wants to give the government platitudes for bailing him out while the rest of us continue on the road to perdition.

Personally, I wish they would simply stop all this senseless fooling around and get the crash over with. There is nothing that can prevent it, and I am tired of having smoke blown up my ass when I know it is all a pack of lies.

By my definition, we are certainly not "better off" today than we would have been if the government and the Fed had acted within the bounds of moral decency. Keynesian economics or not, you can not print your way out of insolvency.

[jazzbo]

I am tired of having smoke blown up my ass when I know it is all a pack of lies... Must make it difficult to get through each day when encumbered with such insight.

[JimGant]

the great depression was caused by the federal reserve and the decade long inflationary boom that they created with cheap money (sound familiar?)

Not really. We had no 'inflationary boom' leading up to the Great Recession. The last 'inflationary boom' was in the early 80's. And the Fed, under Volcker, handled that neatly. Housing bubbles, yes. Hyper, or advanced inflation, no. (Still wondering why you think we now, today, have an inflation problem....).

But, yes, the Fed did help in turning a recession into a depression -- by NOT printing money. No QE1 or QE2 then -- as this was as alien then as Keynesian fiscal stimulus.

From Milton Friedman:

And what happened is that [the Federal Reserve] followed policies which led to a decline in the quantity of money by a third. For every $100 in paper money, in deposits, in cash, in currency, in existence in 1929, by the time you got to 1933 there was only about $65, $66 left

Read your history, chunky.

Depends on how you define "better off" now, doesn't it?

Classic short term vs. long term. The immediate problem required a quick fix, and increasing the money supply and fiscal stimulus, wherever it could be felt soonest, were the tactics. Far from perfect, in their implementation, but definitely needed. Even now, slowing down too quickly (like canceling the Bush tax cuts)is dangerous. But politics are beginning to put the brakes on too soon, in my opinion. Because we have to turn this around, short term, so the much larger long term problem can be addressed from an economy that hasn't completely collapsed.

And, of course, that problem is the huge deficit. At least now (Alan Simpson, et al)are defining the problem. That it can ever be solved, when idiots like Pelosi say 'we can't do that' is certainly worrisome. Maybe something like the base closure all-or-nothing system might work.....Or maybe politicians could only be allowed to serve one term -- so that they could make the decisions needed, and not those that will get them re-elected.

Democracy is completely disfunctional in situations like the above. No wonder the Founding Fathers restricted voting to the presumably educated (white, male, landowners).

Anyway, Buffet's review of the short term solutions was pretty darn accurate.

[jazzbo]

.. and just who is the acknowledged academic expert on the causes of The Great Depression: Dr. Benjamin Bernanke...

KANSAS CITY, Mo. -- Federal Reserve Chairman Ben Bernanke on Sunday said

he engineered the central bank's controversial actions over the past

year because "I was not going to be the Federal Reserve chairman who

presided over the second Great Depression."

http://online.wsj.com/article/SB124865498517982625.html

[JimGant]

and just who is the acknowledged academic expert on the causes of The Great Depression: Dr. Benjamin Bernanke...

And that's a bad thing...?

[Chunky1]

.. and just who is the acknowledged academic expert on the causes of The Great Depression: Dr. Benjamin Bernanke...

KANSAS CITY, Mo. -- Federal Reserve Chairman Ben Bernanke on Sunday said

he engineered the central bank's controversial actions over the past

year because "I was not going to be the Federal Reserve chairman who

presided over the second Great Depression."

http://online.wsj.com/article/SB124865498517982625.html

except that he doesn't actually understand the great depression. nor does he have any non academia experience in business or economics.

[Chunky1]

the fed created a period of inflationary boom w/ cheap money supply for a decade before the depression and then when they pulled back the money supply it caused the great depression. propagandists then try to say "see they caused all the problems by creating a liquidity crisis. they should have been printing money in 1929", i guess the fed also created the housing and bubble and tech bubble only when they raised interest rates to mop up extra cash and fight inflation. just dont mention that the cheap credit was the start of it all. keynesian is a complete joke. bernanke is a complete idiot who is set on destroying the global economy. this will end horribly for Americans.

Edited November 20, 2010 by Chunky1

[jazzbo]

(Bernanke) doesn't actually understand the great depression I see... noted... Launch another Cutty Sark

[JimGant]

except that he doesn't actually understand the great depression.

...an observation from someone who believes we're currently undergoing some pretty serious inflation.

[Chunky1]

http://en.wikipedia.org/wiki/America%27s_Great_Depression

[Chunky1]

except that he doesn't actually understand the great depression.

...an observation from someone who believes we're currently undergoing some pretty serious inflation.

sorry, i judge inflation based on prices of goods and services and commodities not what people on tv tell me.

[jazzbo]

... and the guy just sits here in Thailand while with his great insight he could be becoming part of former Gov. Palin's economic brain trust.

[Chunky1]

my money is where my mouth is. where is yours?

[jazzbo]

... not in your mouth.

[Chunky1]

prepare to lose money then.

[jazzbo]

I see ... So anyone who doesn't follow the financial advice of some popinjay on ThaiVisa is condemned to lose money ... how does anyone know just where my money is already invested and with whom ...

[Chunky1]

[Chunky1]

http://www.youtube.com/watch?v=gldETRlhiXk&NR=1

[Chunky1]

[jazzbo]

thanks Mr. Howitzer -- nice editing.

[waza]

I see ... So anyone who doesn't follow the financial advice of some popinjay on ThaiVisa is condemned to lose money ... how does anyone know just where my money is already invested and with whom ...

I like your post.........Just my personal impressions but consummerable are going up in price, such a food and services.

[jazzbo]

BTW Whoever is in charge, that is who I support until he or she is relieved of the job and someone else takes their place.. From the screenplay of The Caine Mutiny (following Captain Queeg's total disintegration on the witness stand)

You don't work with the captain

because of his hairstyle, -- but because he's got the job,

or you're no good.

or I guess, as a last refuge when nothing else works, just pull out those Ron Paul clips

Edited November 20, 2010 by jazzbo

[Chunky1]

i am just trying to show you that just because someone has the top position does not mean that they know what is best. so i think it's great that you have faith in the guy who said home prices dont go down to solve the housing bubble.

this discussion feels pretty one sided right now. unless you give me some kind of sign that you arent a complete idiot i am going to have to stop responding.

[Chunky1]

I see ... So anyone who doesn't follow the financial advice of some popinjay on ThaiVisa is condemned to lose money ... how does anyone know just where my money is already invested and with whom ...

I like your post.........Just my personal impressions but consummerable are going up in price, such a food and services.

are you seriously attempting to discredit the chairman of the federal reserve? and you are what? just an internet poster? how dare you! he has already informed the world that prices aren't rising. his CPI model said so!

[Chunky1]

I see ... So anyone who doesn't follow the financial advice of some popinjay on ThaiVisa is condemned to lose money ... how does anyone know just where my money is already invested and with whom ...

you probably dont have any money invested anywhere. and of course you wont state your actual opinions cause when i bump this topic in the future you wont want to be proven wrong. when i bump this in the future ur jsut going to claim "oh you dont know what i really had! i made a killing".

[jazzbo]

As an experienced investor I am prepared that some years you have gains (paper or otherwise) and some years you do not; anyone expecting to make a killing is a fool.

you probably don't have any money invested anywhere... from the screenplay of Chinatown (GITTES - Jack Nicholson; EVELYN- Faye Dunaway)

GITTES (continuing) -- there's some misunderstanding here. It's not going to do any good to get tough with me --

Evelyn flashes a cold smile.

EVELYN I don't get tough with anybody, Mr. Gittes. My lawyer does.

... and whatever opinions I might have to refute those of someone like Dr. Bernanke (PhD, MIT) I do not rely on a link to Wikipedia to buttress my position against hi published peer-reviewed papers.

Edited November 20, 2010 by jazzbo

[Chunky1]

it was a wiki link to an economics book.

[jazzbo]

it was a wiki link to an economics book... which I am sure you have now read cover to cover. (btw Murray Rothbard's Great Depression) ... Great ... Another one of the 'Just because I am smarter than all of them, why don't the other kids want to play with me?' school of economics.

From David Mamet's screenplay for The Verdict:

MICKEY

And how the f-ck...You broke the

first law that they taught you in

law school. You never ask a question you don't know the answer to.

Edited November 20, 2010 by jazzbo