A decade after the 2008 financial crisis: The lingering effects

[EndDomination]

At the end of the day, it would have been 1929 again. Obama bailed the people out who could pay it back.

It would have been early political suicide, but bailing out the US citizenry instead of the banks likely have closed the wealth gap some, and done more for those hit hardest by the crisis.
Wishful thinking.

 

[FAH1223]

It would have been early political suicide, but bailing out the US citizenry instead of the banks likely have closed the wealth gap some, and done more for those hit hardest by the crisis.
Wishful thinking.

I don’t think it would have been.

Dems lost the House in 2010

And then got wiped out anyway

 

[ADevilYouKhow]

Wells Fargo says hundreds of customers lost homes after computer glitch

 

[Wild self]

I was an 09 grad with a double major in Econonics and Political Science. It was a nightmare when internship experience didnt matter and hiting freezes were happening all over the place. Both government and private sectors. I was so pissed that I thought that a French Revolution style event would occur with countless teachers and school administrators LYING to millions of young people thwit entire lives would get murdered in the masses. It also made people lose faith in the education system, even the STEM majors.

Thats why Basic Income is needed

 

[BoBurnz]

You knew it was all just theater to prop up still untenable financial institutions because the people in the fed that either knew and did nothing or knew and let things continue to ride were still allowed to remain and then became the controlling power in the fed once Greenspan's influence waned fully in 09'. The minute I saw that they kept Bernanke as head I knew it was all just a joke.

It was never going to "topple the global economy" that's a post-facto lie that the very people with a vested interest in keeping Citigroup afloat would simply have you believe. Just like the people that swear up and down that Greenspan giving LTCM a put saved the entire system from collapsing, just like those that argue that the put on Black Monday saved the system. It's crap, the system fukked up and the tumble was the system correcting itself and theoretically then balancing out after some pain and loss to teach these companies to not play around and gamble with other peoples money. Instead all it did was legitimize the system as is. Citigroup collapsing would have cause a lot of pain, yes, but the economy was never going to collapse and we sure as shyt weren't going to get another great depression in 2008-09. The only reason the recession THEN was worse than it should have been was because the market overreacted to the recession and the bubbles bursting all at once. But we were prepared then for it because we had less debt and more credit lines to use the fed as a bulwark to keep inflation stable by hiking interest rates and having to deal with some Paul Volker esq monetary policy.

Now? The cat is out of the bag and the genie is out of the bottle. There are no more protections left in place and the market is even MORE intertwined in our own finances and savings than it was in 2008. The crash that's coming, and it is coming, is going to obliterate peoples savings and absolutely cripple the US economy, and we are woefully unprepared. We've done nothing in the decade since but cut monetary protections and regulations for the common person. There isn't even a functional oversight board for derivatives regulation still. Trump has outright refused to staff KEY AND IMPORTANT GOVERNMENT POSITIONS in regards to regulations. I and others have been screaming about this since he was inaugurated and has still left these positions unfilled.

We are not ready for the next one. The first one was a bloody lip, this one, with the current political and societal climate? Thousands are going to die.

 

[BoBurnz]

Our current system isn't the spinning plates that it was in 08. Our system now is all the plates fell a decade ago and wall street has simply been telling you "no no, they're still spinning see" while trying to hide the shattered bits on the ground and hoping nobody sees.

I'm honestly amazed it's lasted this long, but this is the end result of late stage capitalism. It ain't finna be pretty.

And what really pisses me off is we had the answer as to what to do. The fed had a history before Greenspan decided "regulations are bad but the government will give you a handout if you need it" in his crypto Randian alzheimers riddled brain, of doing exactly what should be done. Take the hit, ease lending, lower spending caps, take some slight inflation, ease interest rates up and up until the market stabilizes then slowly move interest rates back down to encourage spending again and keep the system afloat.

 

[Oville]

The “Next” Financial Crisis

Paul Sliker: So, Michael, over the past few months the IMF has been sending warning signals about the state of the global economy. There are a bunch of different macroeconomic developments that signal we could be entering into another crisis or recession in the near future. One of those elements is the yield curve, which shows the difference between short-term and long-term borrowing rates. Investors and financial pundits of all sorts are concerned about this, because since 1950 every time the yield curve has flattened, the economy has tanked shortly thereafter.

Can you explain what the yield curve signifies, and if all these signals I just mentioned are forecasting another economic crisis?

Michael Hudson: Normally, borrowers have to pay only a low rate of interest for a short-term loan. If you take a longer-term loan, you have to pay a higher rate. The longest term loans are for mortgages, which have the highest rate. Even for large corporations, the longer you borrow – that is, the later you repay – the pretense is that the risk is much higher. Therefore, you have to pay a higher rate on the pretense that the interest-rate premium is compensation for risk. Banks and the wealthy get to borrow at lower rates.

Right now what’s happened is that the short-term rates you can get by putting your money in Treasury bills or other short-term instruments are even higher than the long-term rates. That’s historically unnatural. But it’s not really unnatural at all when you look at what the economy is doing.

You said that we’re entering into a recession. That’s just the flat wrong statement. The economy’s been in a recession ever since 2008, as a result of what President Obama did by bailing out the banks and not the economy at large.

Since 2008, people talk about “look at how that GDP is growing.” Especially in the last few quarters, you have the media saying look, “we’ve recovered. GDP is up.” But if you look at what they count as GDP, you find a primer on how to lie with statistics.

The largest element of fakery is a category that is imputed – that is, made up – for rising rents that homeowners would have to pay if they had to rent their houses from themselves. That’s about 6 percent of GDP right there. Right now, as a result of the 10 million foreclosures that Obama imposed on the economy by not writing down the junk mortgage debts to realistic values, companies like Blackstone have come in and bought up many of the properties that were forfeited. So now there are fewer homes that are available to buy. Rents are going up all over the country. Homeownership has dropped by abut 10 percent since 2008, and that means more people have to rent. When more people have to rent, the rents go up. And when rents go up, people lucky enough to have kept their homes report these rising rental values to the GDP statisticians.

If I had to pay rent for the house that I have, could charge as much money as renters down the street have to pay – for instance, for houses that were bought out by Blackstone. Rents are going up and up. This actually is a rise in overhead, but it’s counted as rising GDP. That confuses income and output with overhead costs.

The other great jump in GDP has been people paying more money to the banks as penalties and fees for arrears on student loans and mortgage loans, credit card loans and automobile loans. When they fall into arrears, the banks get to add a penalty charge. The credit-card companies make more money on arrears than they do on interest charges. This is counted as providing a “financial service,” defined as the amount of revenue banks make over and above their borrowing charges.

The statistical pretense is that they’re taking the risk on making loans to debtors that are going bad. They’re cleaning up on profits on these bad loans, because the government has guaranteed the student loans including the higher penalty charges. They’ve guaranteed the mortgages loans made by the FHA – Fannie Mae and the other groups – that the banks are getting penalty charges on. So what’s reported is that GDP growth is actually more and more people in trouble, along with rising housing costs. What’s good for the GDP here is awful for the economy at large! This is bad news, not good news.

As a result of this economic squeeze, investors see that the economy is not growing. So they’re bailing out. They’re taking their money and running.

If you’re taking your money out of bonds and out of the stock market because you worry about shrinking markets, lower profits and defaults, where are you going to put it? There’s only one safe place to put your money: short-term treasuries. You don’t want to buy a long-term Treasury bond, because if the interest rates go up then the bond price falls. So you want buy short-term Treasury bonds. The demand for this is so great that Bogle’s Vanguard fund management company will only let small investors buy ten thousand dollars worth at a time for their 401K funds.

The reason small to large investors are buying short term treasuries is to park their money safely. There’s nowhere else to put it in the real economy, because the real economy isn’t growing.

What has grown is debt. It’s grown larger and larger. Investors are taking their money out of state and local bonds because state and local budgets are broke as a result of pension commitments. Politicians have cut taxes in order to get elected, so they don’t have enough money to keep up with the pension fund contributions that they’re supposed to make.

This means that the likelihood of a break in the chain of payments is rising. In the United States, commercial property rents are in trouble. We’ve discussed that before on this show. As the economy shrinks, stores are closing down. That means that the owners who own commercial mortgages are falling behind, and arrears are rising.

Also threatening is what Trump is doing. If his protectionist policies interrupt trade, you’re going to see companies being squeezed. They’re not going to make the export sales they expected, and will pay more for imports.

Finally, banks are having problems of they hold Italian government bonds. Germany is unwilling to use European funds to bail them out. Most investors expect Italy to do exit the euro in the next three years or so. It looks like we’re entering a period of anarchy, so of course people are parking their money in the short term. That means that they’re not putting it into the economy. No wonder the economy isn’t growing.

Bro this article tho . I knew there had to funky shyt going on underneath this recovery but this article really enlightened me on the bullshyt

 

[Swirv]

Let’s see how far this Turkish lira crisis spreads.

 

[storyteller]

Subbing this thread...

 

[Berniewood Hogan]

We are not ready for the next one. The first one was a bloody lip, this one, with the current political and societal climate? Thousands are going to die.

Every day I check the news, thinking, "Is today that day?" People tell me not to think too much about it. It's an avalanche coming right at us. Don't think too much about it?

 

[Arrogance.]

I was an 09 grad with a double major in Econonics and Political Science. It was a nightmare when internship experience didnt matter and hiting freezes were happening all over the place. Both government and private sectors. I was so pissed that I thought that a French Revolution style event would occur with countless teachers and school administrators LYING to millions of young people thwit entire lives would get murdered in the masses. It also made people lose faith in the education system, even the STEM majors.

Thats why Basic Income is needed

Part of me thinks we're on the edge of that right now, just waiting for a spark to happen.
But nobody wants to die for this shyt. And people will have to die for the revolution.

 

[Ya' Cousin Cleon]

Every day I check the news, thinking, "Is today that day?" People tell me not to think too much about it. It's an avalanche coming right at us. Don't think too much about it?

read up on Argentina's economic situation from '01-'03.

1998–2002 Argentine great depression - Wikipedia

December 2001 riots in Argentina - Wikipedia

 

[newarkhiphop]

subs

 

[88m3]

The million-dollar brownstone that no one owned

 

[88m3]

The Financial Crisis Cost Every American $70,000, Fed Study Says


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