Financial topics

[aedens]

Funding Facility, tapping the program 11 times for $74.5 billion. Six European banks were among the top 11 companies, a combined $274.1 billion . Dexia tapped the US government for $53.5 billion.

They just added more to the fraud ledger. They knew exactly what he was doing. That is what went to the Eurotards not including the amount the
prime Minister from Australia came nocking on the door for. Taxpayers are idiots.

Just group think saints: http://www.youtube.com/watch?v=nSTp2y4QO7I

[Reality Check]

US and UK government debt in historic perspective

http://www.simontaylorsblog.com/2011/12 ... rspective/

Great Britain financed both World War I and World War II, to the tune of 200 % GDP for World War I,

and 250% of GDP for World War II.

U.S. went in debt over 100% of GDP for World War II. Only 30% of GDP for World War I.

What would be interesting is to see GDP growth for both countries for the same period.

[Trevor]

In 2010 pounds, the United Kingdom's economy grew from 309.5 billion pounds to 1395.3 in 2010. The growth was pretty slow until the mid-1960's.

[OLD1953]

http://www.huffingtonpost.com/daron-ace ... 38118.html

"When politics gets thus hijacked, inequality of opportunity follows, for the hijackers will use their power to gain special treatment for their businesses and tilt the playing field in their favor and against their competitors."

"Things were much worse during the Gilded Age, and the wealthy elite more unscrupulous. Yet the robber barons did not prevail. The U.S. political system was also able to tackle the problem of Southern segregation and black disenfranchisement, which if anything looked even more insurmountable."

I believe this is the first time in the history of the US that the wealthy have hijacked the public finances and stolen this much money from the public treasury in broad daylight. This is what I think makes the current situation different (and potentially worse) than the Gilded Age or Southern segregation.

http://www.cnbc.com/id/34953353/CNBC_Tr ... w_Part_One

"BUFFETT: I didn't like it. (Laughs.) No, I mean, the government forced them to issue the shares. The government's done a lot of good things for the economy and net I'm a beneficiary and Berkshire Hathaway is a beneficiary of the things overall they've done."

"...net I'm a beneficiary and Berkshire Hathaway is a beneficiary of the things overall they've done."

True.

"BUFFETT: (Laughs.) No, what was done in the fall of 2008 was designed to save the American economy. It wasn't designed to save the banks, it wasn't designed to save me. It was designed to 309 million Americans and a good job was done."

False.

This is the first time in European or US history that this much money from the public treasury has been transferred to the wealthy ("top 1%") that I know of since the 14th Century. Financing a war effort out of the public treasury is a different deal. There may be examples of such transfers of substantial funds from the public treasury to royal families (1789 France), but none to corporate elites that I am aware of.

If I'm wrong on that and anybody can show my ignorance, I'd be grateful to be enlightened.

To answer that last, I'll have to break one of the rules of internet discussion, so I'm going to have to ask for a waiver from the rule that states "any mention of the word facism means you automatically lose and are subject to ridicule for drawing a comparison with facism".

http://en.wikipedia.org/wiki/Economy_of ... er_fascism

http://www.britannica.com/EBchecked/top ... c-programs

While I've found no hard data as to wealth transfers in facist Italy, there are several things to note that indicate such transfers did indeed take place in a large way.

1. Replacement of trade unions with faux state unions.
2. Replacement of the state insurance company with private insurance.
3. Tax cuts of all sorts, no tax on capital in the finance industry and no inheritance tax.
4. Manipulation of the money supply in various ways, both up and down.
5. Government intervention in various industries and production.

Numerous sources state repeatedly that propaganda victories were more important than actually fixing things, and that consumers were the usual losers in such faux victories and the wealthy were the winners. I strongly believe that if you can find hard data you'll find that their wealth transfers were much as ours are, in proportion to the size and value of the economy in question and the size of the Italian population at the time. In other words, I believe that if the data were correctly normalized it would show much the same pattern of wealth transfer.

The similarity between the current USA economic policy and Italian economic policy circa 1930 is eerie.

[vincecate]

US and UK government debt in historic perspective

http://www.simontaylorsblog.com/2011/12 ... rspective/

After the war ends they cut the military way back. The total government spending is cut in half and there is no deficit. Once there is no deficit there is no danger of hyperinflation. There is no way the government will cut spending if half today. It is not the same situation at all.

http://pair.offshore.ai/38yearcycle/#debtlevel

[OLD1953]

Spending vs GDP if all levels of govt are considered are not out of whack with norms since WWII, given the current situation of winding down two wars and ongoing expense from that. All countries vs govt spending as a percentage of GDP is listed here on Wikipedia (from the WSJ and Heritage Foundation).

http://en.wikipedia.org/wiki/Government_spending

Shows pretty plainly our tax collections are out of line with our spending, but name the country with much lower %ofGDP spending that isn't hiding under the US defense umbrella, AND you are willing to spend time in. There are darn few. The Truman Doctrine guarantees the USA will have at least a 1%-2% of GDP extra spending over any other developed nation, and that should be accounted for in any critic of spending. Alas, it seldom is.

http://www.oecd.org/statistics/

And those are the OECD stats. Developed countries are simply expensive, and always have been. And a lot of people don't like it, but like living with good roads, etc. Which is the usual inconsistent human nature, wanting something for nothing.

[Reality Check]

US and UK government debt in historic perspective

http://www.simontaylorsblog.com/2011/12 ... rspective/

After the war ends they cut the military way back. The total government spending is cut in half and there is no deficit. Once there is no deficit there is no danger of hyperinflation. There is no way the government will cut spending if half today. It is not the same situation at all.

Problem is, virtually none of that is shown in the graph provided by H above. The graph does not show what the the Deficit was in any year, it does not show what the GDP was in any year, it does not show what the Inflation rate was from year to year. It does not even, show what the Total Debt was for any given year. It just shows what the Total Debt ( what ever it maybe ) divided by the GDP ( what ever it maybe ) was in any given year.

http://www.simontaylorsblog.com/2011/12 ... rspective/

One must assume the debt and GDP ( used to calculate H's graph percentages ) was in non-inflation adjusted Pounds ( in the case of GB ) and non-inflation adjusted Dollars ( in the case of the U.S. ), but if that is true then:

1. Year to Year real ( inflation adjusted ) growth (GDP) can be a huge portion of declines in debt percentages shown in H's graph..

2. Year to Year growth in inflation can be a huge portion of declines in debt percentages shown in H's graph..

3. Devaluation of the Pound ( in the case of GB ) or the Dollar ( in the case of the U.S. ) can be a huge portion of declines in debt percentages shown in H's graph..

4. Declines, Year to Year declines, in GDP can be a huge part of increases in the Debt percentages shown in H's chart.

Without also having year to year information on changes in GDP, Inflation and devaluation events during the same 181 year period from 1830 to 2010, we really can not determine the cause of these changes in percentages, except the very clear impact of Great Britain using borrowed money to pay for both World War I and World War II and the U.S. using borrowed money to pay for World War II.

[Reality Check]

Spending vs GDP if all levels of govt are considered are not out of whack with norms since WWII, given the current situation of winding down two wars and ongoing expense from that. All countries vs govt spending as a percentage of GDP is listed here on Wikipedia (from the WSJ and Heritage Foundation).
http://en.wikipedia.org/wiki/Government_spending

The link does not support your statements of fact: "Spending vs GDP if all levels of govt are considered are not out of whack with norms since WWII ..." In fact, I do not believe there is even a single time series in that link that shows "Spending ( of ) all levels of government" over the years you are discussing, "since WWII". The time series graph of just U.S. Government spending, that is included in your link, proves just the opposite of what you are stating.

This appears to be nothing but a political talking point, desperately searching for facts that would support it.

[Reality Check]

I believe this is the first time in the history of the US that the wealthy have hijacked the public finances and stolen this much money from the public treasury in broad daylight. This is what I think makes the current situation different (and potentially worse) than the Gilded Age or Southern segregation.

Is there any reason to believe they are done yet ?

The question is where this is going from here, and how will it wind down, when the collapse eventually begins.

People do not die, either financially, or literally, nice and clean like in the movies, and that assumes the collapse is at hand,
there may be more assets to steal, and more money to loot, in the coming months, and even years, before the collapse is in full swing.

[Reality Check]

.. mostly I think the US is in a monster government debt bubble, where the real financial crisis has been held off with US government borrowing. The US has a higher government debt to GDP ratio now than it did until about 1942 (don't know the exact year but I should look it up to see where it is now because I haven't for awhile).

The war ( World War II, the last crisis war ) started for the United States when the Japanese bombed Pear Harbor right before 1942 ( DEC 1941 ). So most of the borrowing related to World War II occurred after 1942. World War II ended for the U.S. with the surrender of Japan in late 1945.

The U.S. Debt actually peaked shortly after Word War II in the 1946 time frame.

Gross U.S. Government Debt - 1946 = 120% ( near peak ) of GDP.

Gross U.S. Government Debt - 2012 = 106% ( growing strongly ) of GDP.

And as you point out, in 1946 the U.S. had just paid for a Crisis War using borrowed money. Today, the U.S. is not even gearing up for a crisis war, but instead, deeply slashing defense spending.

External Debt. The more interesting question, and more meaningful from a what is going to happen next stand point,
is how much of the 1946 Debt ( versus 2012 ) is External Debt ?