Imagine the worst that could happen with our economy?

[kentuck]

Indeed, we could have record unemployment. Already, we have a record for the number of people applying for food stamps. It could get really bad and what type of economic policy should we have if the worst were to happen?

Should we continue to prop up Wall Street? Or should we develop a policy that will help those that are at the bottom and are in the most need? Which would be best for our economy as a whole?

I would suggest the latter. Whatever money is given to the poor in the form of food stamps or jobs will go directly back into our economy. That will keep our heads above water and keep many of our citizens from drowning. The same cannot be said by the present strategy of giving everything to "save our banking system.

First of all, our banking system will not disappear. The problem lies with a certain sector of our banking system. And that is what we must decide on how much more money we wish to give this sector of our economy, that is tied directly to Wall St investors and scam artists. That is the decision that needs to be made.

In my humble and uneducated opinion, I think this is where the new Administration should be focusing its attention. We need to build this economy from the bottom up. The trickle-down that they hope the banks will provide our people is not going to work. I hope they re-think this whole strategy of bailing out Wall Street bankers.

[kentuck]

1. Does anyone think we should continue our present strategy??

Or are we too dumb to question their motives or their reasons for bailing out Wall Street? We should leave that for the "smarter" folks - like Henry Paulson and Robert Rubin?

[exboyfil]

2. Treasury default

This is the worst thing that I could imagine for the economy. Since 40% of my retirement is in TIPS it would be devastating to me. It would surely crush the rest of the financial markets (social chaos, martial law etc to follow).

I am betting on hyperinflation instead. A good way to make all those debts disapear.

We should have never gone down this bail out road, and, if we do, why did we get such a poor deal on the preferred stock (half of what Buffett and the Bank of England got for example).

I am very disapointed in Obama's pick for Treasury secretary. I would have liked to see an individual with an economics education that had also founded and run a company that actually made something.

Does someone who has always been feeding on the public teet make for a good choice? Someone from the New York/Washington nexus seems like the wrong solution moving forward as a country.

[pitohui]

3. your comments on obama's pick puzzle me

obviously it would be a terrible idea to pick someone who is (or has been) in the private arena and who would therefore profit by turning over even more of our economy to the private sector in the form of bogus bail outs, bad deals for bail outs and loans, and so forth

i thought obama's pick was terrific, we want someone who has always been dedicated to public service, not another corporate shill "who founded a company that actually made something"

dick cheney was ceo of halliburton and pretended to divest himself of most of his interest, but of course all of his family and friends and his entire network was still invested or even working there, how is that working out this time of century?

a quarterback in the game can't be the referee, the referee can't be the coach for one of the teams

as far as default on treasuries, no, it can't happen, altho the power of the printing press that protects us from default does carry some threat of inflation

i am curious as to "how" you are betting on hyper inflation -- i am not seeing a good way to profit on that prediction -- well, other than paying off one's property in full and as many properties thereafter as possible but you could still lose them to hyper inflation in property tax -- i recently had to fight a property tax assessment that tripled at a time when, sweet jesus, it is not possible to sell my house at any price -- so that makes me wary even of the traditional route to protect against hyper inflation, which is to own property in full, they can still take it just by setting the tax too high and saying "hey inflation sorry"

[exboyfil]

6. I agree revolving between private and publc can be a problem

My contention is that folks that only spend their time in the New York-Washington corridor have no understanding of the importance of manufacturing to the overall economy. You can see by Geithner's first response to the crisis (ie bailing out AIG) indicates Wall Street thinking even if he has never been on Wall Street (except as part of the Fed)

Also folks who are only in the public sector have no understanding of the difficulties faced by businesses (ie making payrolls etc). Most of the time their budgeting decisions are done on the margins (10 percent up or down) with a presumption that the entire budget needs to get spent that year. Entirely different than how businesses think about cash flow.

Dick Cheney is not the type of person of which I am speaking. He was a hired gun CEO after revolving out of government. Exactly the wrong kind of person from what I want. I don't want a hired manager, but one who founded and built up a company. Ideally I would like to see this kind of career:

B.S. in a technical field like Science, Enginering Economics, or actuarial sciences.

M.B.A. earned while working full-time in a company.

Start of own business after five or so years working for a company.

Cashing out of a successful business after ten to fifteen years.

Returning to college for additional economics education (perhaps even a PhD if possible)

Teaching or working for a think tank until plucked out for work in the Fed, Treasury, etc.

Elevation to Sec Treasury.


I admit that Geithner is better than most (Paulson and Rubin being two examples), but how is he that much different than these last two except he has not revolved out the door yet? His private experience with Kissinger Associates really does not qualify as private experience but just another influence peddling firm.

Once he is done at the Treasury, I would bet $100 that he lands as CEO of a company like Citigroup etc. The economy is a whole lot more than these banks and pseudo insurance houses (or at least it should be). We need to get back to making things not importing stuff and exporting debt. Heck Alexander Hamilton understood how important it was, and that is why he tried to steal trade secrets from the British. I get the feeling that folks like Paulson, Bernake, Rubin, Summers, and even Geithner don't even understand why manufacturing is so important and what it means when a manufacturing base collapses for our future prosperity and economic and political security.

I don't want to see hyperinflation, but we are spending dollars like crazy (an insane $1T war to start and now $3T+ in bail outs etc). I am hoping that Obama can bring some fiscal restraint to the process. If he does not then hyperinflation appears to be the only alternative.

[smoogatz]

7. There's no evidence at the moment of anything like hyper-inflation

kicking in. In fact, the last month or two prices have actually been going down as consumer demand dries up and the economy shrinks. People are spooked: they're watching their home equity go down the drain, watching their IRAs and 401ks dwindle, watching their friends and relative lose their jobs, and listening to Paulson and Bernanke tell them they have everything to fear and they'd better hand over the cash, right fucking now. We're looking at the opening phase of a classic deflationary depression, seems to me. The only way you get hyper-inflation is if the bottom falls out of the treasury markets (China or Japan decides to dump bonds, say). Then we'd have to pay higher rates, and print more cash to cover the debt. I was actually worried about an inflationary depression a month ago, and started stocking up on basics in case of market disruptions and spot-shortages (or just runaway prices on food). Then the price of oil started to tank and Obama won the election. I'm a lot less worried than I would be if McCain was going to be the next president.

On edit: I think the notion that ex-CEOs somehow make the best economic advisors has been thoroughly discredited over the past eight years. Knowing how to max out a company's bottom line is nothing like working to establish a sustainable, equitable economic policy for a nation of 300 million people. I don't care who they are, as long as they're right a hell of a lot more than they're wrong.

[exboyfil]

16. A hired gun CEO is not the same thing as an entrepreneur

Paulson has been a disasterous choice for Secretary, but he is just one in a long line of disasters dating back to the Clinton administration (Rubin's hands are all over this financial market melt down).

I don't think ex-CEOs are necessarily better than trained economists, but I do think we need to have attention to manufacturing and start up businesses in our Treasury department. Except for O'Neill (who was also a hired gun revolving door CEO) when was the last Treasury secretary with private manufacturing experience? They all seem to be folks involved with trading pieces of paper back and forth.

One of the most disturbing quotes that I heard in the last few years (long before the financial melt down) was that we should not be concerned about the decline in the manufacturing base because of our growth in the service economy, in particular FINANCIAL SERVICES.

[babylonsister]

4. Isn't that what Obama's economic stimulus package is all about?

http://www.boston.com/news/nation/articles/2008/11/25/a_vow_to_jolt_the_economy/

A vow to jolt the economy

WASHINGTON - President-elect Barack Obama yesterday introduced his top economic aides with a promise to use a massive stimulus program to "jolt" back on track an economy that could lose millions of jobs, while also warning that a looming huge budget deficit will require cutting programs and reconsidering priorities.

Sounding as though he were already assuming the reins of power 57 days from his inauguration, Obama said he had instructed his new economic team to craft a plan to create or save 2.5 million jobs in his first two years, and he urged the new Congress, which convenes Jan. 6, to have the legislation ready for him to sign as soon as he is sworn in as president two weeks later. "We do not have a minute to waste," he said.

more...

[vssmith]

5. Trickle down never gets down to the folks that need it

Give it to those in need and in time the rich will get it--only thing is they will actually have to work for it.

[Alcibiades]

8. We will have some deflation

For a little while, as the recession really sets in. But then, as the effect of all that money being printed has its effect, a much larger inflation will take place.

This would be a good time to rack up as much debt as you possibly can. Though it makes no sense for the broader economy, for you, personally, it makes sense, because the money you repay the loan with will be worth far, far less than it is today. Assuming you will still have a job, that is.

We're entering into a prefect storm created by the wizards who run the financial system: high debt, high inflation, high unemployment. Stock up on canned goods.

[tbyg52]

9. >>I hope they re-think this whole strategy of bailing out Wall Street bankers.

If there's any money left by Jan. 20th.....

[kentuck]

10. There won't be...

any left. I would bet on it.

[judasdisney]

11. False flag terror, military coup, then expansionist U.S. aggression & nuke war

Worst-case Scenario:

2010: FDIC fails. Currency collapses. Something I'm not allowed to write here happens to Obama.
Biden takes office.

2012: Food riots. False flag terror attacks in major U.S. cities blamed on alternately Al Qaeda,
but also blamed on "Leftist Americans".

2013: Hillary vs. Palin election tied 269-269 electoral. Constitution says tied election = House of Reps. Repeat of Election of 1824. House of Reps chooses Hillary as president.

4/4/15: USAF "Al Qaeda infiltrators" use USAF planes to crash into Capitol Dome, White House. Only
Democrats are killed. Entire national-level Democratic leadership is wiped out. GOP demands military takeover for "stability". John Roberts swears-in President Palin.

4/5/15: Operation Falcon begins, roundups of anti-GOP activists & political leaders. Mass-executions in Nationals Stadium, D.C. and stadiums around the country.

7/18/15: U.S. Tiananmen Square type massacre of citizen protesters on the mall in D.C.

7/30/15: U.S. invades Venezuela, Bolivia, Ecuador via staging bases in Alvaro Uribe's fascist Colombia.

10/07/15: Russia-China alliance pre-emptively attacks Europe & U.S. in lieu of Neocon-planned world war. Six-Day World War unleashes new mega-weapons, melts Arctic & Antarctic with thermonuclear weapons, accidentally causes planetary axis shift, global mega-tsunamis + nuke war kill 2/3 of planet.

[kentuck]

12. That's pretty bad...

:-(

Sorry I asked.

[tbyg52]

13. That sounds like the plot of a novel I'd like to read, if you would kindly write it!

Hope it does not come true, but I put nothing past these people.

[earth mom]

14. This country needs jobs that pay a livable wage. The 700 billion should have went to energy jobs.

Industries like solar power, wind power, and energy efficient cars.

I don't think Obama is going to put as much money as is really needed to get this country where it should be because Corporate America won't allow it. It's in their best interests for the people of this country to be at their mercy. :grr:

[ColbertWatcher]

15. The worst that could happen: all the companies merge into one: Wal-Mart. n/t