No Longer Possible To Pretend

[ERD50]

Otherwise I cannot think of a worse thing to dismantle in times like these. For what?

I never indicated that I thought it "should be dismantled in times like these". Where do you get that from?

Breaking promises to those who played by the rules of the game would be disruptive and wrong. However, I think that going forward SS should be completely restructured. I recall posting on this a while back, and no one could succinctly describe just what SS is supposed to do. You can't plan to reach a goal unless you first define it.

That's the problem with most govt programs IMO, they don't really say what the goal is, and they provide no way to measure the results. They just "do something". And it is often counter-productive to some other "do something" program.

-ERD50

 

[Purron]

Puh-leeze. "the biggest turn left since FDR" I guess you forgot Nixon's wage and price controls and Reagan's Earned Income Tax Credit.

The current operative meme on the Right seems to be to kill Social Security. The banksters HATE Social Security because it is a slice of wealth that they cannot get their hands on. It is outside their system.

GWB and certain Republicans, most lately Eric Cantor and his ex-Goldman Sachs VP wife, want the banksters to "manage" that money. Do not let them pull the wool over your eyes.

If you feel like Soc.Sec. is giving you too much please donate it to the charity of your choice. Otherwise I cannot think of a worse thing to dismantle in times like these. For what? So that people can take the money and go back to spending on cars and houses they don't need? With the R-proposed $15k house tax credit??

Every one of the Powers That Be wants to go back to the status quo ante of market borrowing and spending. If that won't happen, they will try to force it to happen. This is beyond left and right.. they all want to restart the debt machine. They will force private borrowing and when that is exhausted they will force gov. borrowing. It doesn't matter whether it is for wars or trains or houses.. the important thing is to grow the aggregate debt.

Ladelfina - you're back I missed ya!

 

[JOHNNIE36]

I've heard some "talking heads" mention recently that the FDR programs extended the depression rather than help.

I'm not sure it can be measured with any reasonable degree of certainty one way or the other. Maybe someone can help with a reliable reference on this?

Thought this was talked about a few weeks ago on one of the forums. Someone mentioned that FDR was so good that he made sure the depression lasted through his four terms of office. True or not, I think history shows he was the right man, at the right time for the job. Who could have done it better? I can remember my Mother hugging me while crying the day he died.

 

[Texarkandy]

Perhaps we should have a special tax for expatriate Americans for not sharing-the-wealth by "buying American" & paying sales taxes in the US?

 

[Leonidas]

Who could have done it better?

Wendell Wilkie?

 

[HFWR]

Wendell Wilkie?

Oops, I seem to have wondered into the mosh pit...

I think Obama is trying to jumpstart the capitulation! Yeah, that's it...

 

[dex]

that political trends are not the most important issues facing retirees and investors today.

Ha

You really lost control of this thread.

I'm not sure if what is going on now is similar to what was going on during the election - so maybe discussions will not be as heated. Also there really isn't any opposition to speak about.

 

[FinanceDude]

GWB and certain Republicans, most lately Eric Cantor and his ex-Goldman Sachs VP wife, want the banksters to "manage" that money. Do not let them pull the wool over your eyes.

If you feel like Soc.Sec. is giving you too much please donate it to the charity of your choice. Otherwise I cannot think of a worse thing to dismantle in times like these. For what? So that people can take the money and go back to spending on cars and houses they don't need? With the R-proposed $15k house tax credit??

Wow, back with the namecalling.......the Soapbox is dead, didn't you get the memo??

 

[HFWR]

In my view, unless Obama and the Dem-controlled Congress manage to pull a wabbit out of a hat, the pendulum will swing back the other way, probably by the next POTUS election, if not the next Congressional election.

Face it, after eight years of RINO rule, many were ready for the pendulum to swing the other way. Add to that the relative unpopularity of the previous administration, and the, IMHO, lackluster ticket the Repubs ran in 2008, and the Dems were almost sure to win.

Interesting note: according to McCain's daughter, the Repubs need to better utilize the internet, and other new technology. IOW, don't improve the ticket, or the policies, just improve the marketing. Shades of Karl Rove... Besides, sound bites are more effective than exploring the nuances of politics, economics, etc., given the attention span, or lack thereof, of the American electorate.

Despite the conservative bent in Texas, I still hear many who think they're "conservative" calling for heads to roll and controls to be placed on executive compensation, the antithesis of conservatism and free-market capitalism. The reason we have a representative democracy is to damper populism, and the "tyranny of the majority". But it's much more fun to yell and scream, and maybe have a "Santelli Tea Party", than to carefully deliberate. And politicans are too busy kissing the assets of lobbyists and campaign contributors to seriously deliberate anything anyway...

 

[haha]

And politicans are too busy kissing the assets of lobbyists and campaign contributors to seriously deliberate anything anyway...

Well, I am praying that they are about to lay some big wet ones on Sallie's boys and girls.

I am all for quality government, except when a little greed and business as usual might help me.

Ha

 

[FinanceDude]

In my view, unless Obama and the Dem-controlled Congress manage to pull a wabbit out of a hat, the pendulum will swing back the other way, probably by the next POTUS election, if not the next Congressional election.

Face it, after eight years of RINO rule, many were ready for the pendulum to swing the other way. Add to that the relative unpopularity of the previous administration, and the, IMHO, lackluster ticket the Repubs ran in 2008, and the Dems were almost sure to win.

Interesting note: according to McCain's daughter, the Repubs need to better utilize the internet, and other new technology. IOW, don't improve the ticket, or the policies, just improve the marketing. Shades of Karl Rove... Besides, sound bites are more effective than exploring the nuances of politics, economics, etc., given the attention span, or lack thereof, of the American electorate.

Despite the conservative bent in Texas, I still hear many who think they're "conservative" calling for heads to roll and controls to be placed on executive compensation, the antithesis of conservatism and free-market capitalism. The reason we have a representative democracy is to damper populism, and the "tyranny of the majority". But it's much more fun to yell and scream, and maybe have a "Santelli Tea Party", than to carefully deliberate. And politicans are too busy kissing the assets of lobbyists and campaign contributors to seriously deliberate anything anyway...

I find it breathtaking that we moved from capitalism to socialism in less than 60 days.........I must be the only one that thinks that.........

 

[HFWR]

I find it breathtaking that we moved from capitalism to socialism in less than 60 days.........I must be the only one that thinks that.........

A lot of pent-up demand?

I would argue that we were already headed down that road, just in a more "disguised" way...

 

[ls99]

I find it breathtaking that we moved from capitalism to socialism in less than 60 days.........I must be the only one that thinks that.........

I predicted it, based on the pres. elect's past history and activities. Except I said that in two years we will know. The speed of it boggles my mind.

Not wanting to link soap box material directly, it is easy enough to find in my postings.

Mercifully neither downturn nor the quasi nationalization of banks, has effected my and DW's standard of living in retirement, which was never near our means, yet quiet comfortable. Pre or post retirement. Oh, and having the house fully paid for sure makes thing a lot easier.

Figure by July there should be sufficient pain for the general population to re-asses the change that came, and the change to alleviate the pain.

 

[newporttony]

I predicted it, based on the pres. elect's past history and activities. Except I said that in two years we will know. The speed of it boggles my mind.

Not wanting to link soap box material directly, it is easy enough to find in my postings.

Mercifully neither downturn nor the quasi nationalization of banks, has effected my and DW's standard of living in retirement, which was never near our means, yet quiet comfortable. Pre or post retirement. Oh, and having the house fully paid for sure makes thing a lot easier.

Figure by July there should be sufficient pain for the general population to re-asses the change that came, and the change to alleviate the pain.

A lot of people I know that voted for Obama have expressed to me that they are absolutely shocked about what has occurred. It seems to me that he is doing what he said he would do and what is completely consistent with having been the most liberal member of the US Senate (and that's really saying something).

 

[Zoocat]

A lot of people I know that voted for Obama have expressed to me that they are absolutely shocked about what has occurred. It seems to me that he is doing what he said he would do and what is completely consistent with having been the most liberal member of the US Senate (and that's really saying something).

I am not shocked by Obama's proposed budget and the changes to tax policy. Reading between the lines of his campaign proposals it was clear to me that his call for "shared sacrifice" meant that the Bush tax cuts were kaput and that other kinds of tax deductions would be phased out. There is no other way to fund a national health insurance policy,
which will directly benefit retirees BTW.

Also, I believe that Obama's specific comments on "unsustainable" deficits and entitlement reforms means that more tax policy changes are coming down the road. Don't be surprised that those making over 250K in retirement will be paying more taxes on their social security and medicare benefits. It's the only way the the entitlement system is sustainable in the long term.

And, for retirees, this economic plan has got to work. We cannot fall into a deep depression. If that happens, then retirees of modest means will be in severe jeopardy. I don't want to see that happen. And if that means that we need to impose higher taxes on those making over 250K then so be it.

 

[ERD50]

And, for retirees, this economic plan has got to work. We cannot fall into a deep depression.

Why does it "have to work"? Wishing can't make it work.

What we need is a plan that will work, not "hope" that the plan that we have will work.

That is miss-placed hope, IMO (and the markets). This plan does not instill confidence that it will work, and confidence is a big factor here.

-ERD50

 

[Zoocat]

Why does it "have to work"? Wishing can't make it work.

What we need is a plan that will work, not "hope" that the plan that we have will work.

That is miss-placed hope, IMO (and the markets). This plan does not instill confidence that it will work, and confidence is a big factor here.

-ERD50

Well, if you have any good suggestions for the Obama economic team, I suggest you email them and include your crystal ball too.

I don't think there has been any confidence since this meltdown began. Were there any great ideas put into practice by the Bush team? What does market "confidence" have to do with anything? The market just wants policy that is favorable to business and the FIRE economy so that we can ratchet up the debt ladder again.

We are done with that. The economy is downshifting now. That bubble was unsustainable and it's not coming back any time soon.

 

[ERD50]

Well, if you have any good suggestions for the Obama economic team, I suggest you email them and include your crystal ball too.

It does not take a crystal (or Magic-8) ball, and they wouldn't listen anyhow. What it takes is policies that address the problems.

What does market "confidence" have to do with anything?

Everything. The market does not go up unless there is confidence that it will go up. People are afraid to spend because they are afraid of losing their jobs. Companies don't want to hire because they are afraid no one is buying.

Were there any great ideas put into practice by the Bush team?

It's over. If you want to complain about Bush and the Democratic Congress (and there is plenty to complain about), go look over old posts in the soapbox. We are talking about what the current administration can do to fix things going forward.

-ERD50

 

[ziggy29]

Okay, okay, y'all -- speaking to no one in particular, I fear we may be headed toward Bush versus Obama "celebrity death matches" or drawn out partisan debates long on partisanism and ideology and short on substance of the relevant issues. This has been a good thread so far, and we've mostly stuck to the issues that are critical to money, investing, economics and the politics of FIRE. I'd like to present some thoughts for consideration.

Let me start with a hypothesis (which you're free to rebut): What we're seeing now is the final chapter, the denouement if you will, of a society which has tried to pretend that the post-WW2 economic bubble which has been deflating since the 1970s was actually sustainable. And to try to sustain it, we've been throwing more and more debt at it -- personal debt, corporate debt and government debt -- so the people currently expecting certain levels of largesse got it. Over time it took more and more debt and leverage to keep the prosperity train rolling along.

And then we hit the wall. It's ending with a sickening thud. I guess the only bright spot is that if we stayed in denial a few years longer, the sickening thud would have been worse.

Given that (or a rebuttal if you disagree), what now? Looking at the issues and the prudence of public policy that affects the economic future of every single one of us, how do we climb out of this mess? Yes, government has to play a role in something this massive, I think, but what role? The transition to a nation of better savers is a good thing, but the sudden and dramatic shift to it -- the almost unprecedented slowing of the velocity of money -- is brutally pummeling the industries and businesses that keep people employed. Many people (myself included) who currently have pretty good times going are pulling WAY back just in case they wind up with a pink slip; we want as much cash in the bank as we can muster "just in case." Multiply me by millions of folks who have good circumstances *now* but fear their own personal economic crash in the future, and you have a massive slowing in the velocity of money, combined with the Tragedy of the Commons: What good does it do me to live my life as I normally would unless I feel others in my position would do the same and make enough of a difference to boost the economy?

IMO, the heady days of the post-WW2 boom are over, and have mostly been since the '70s. We have to readjust to a new norm, one that doesn't rely on excess leverage. Grandma was right. How can we best make that economic transition (that has been needed for decades) and set a new baseline that doesn't occur so quickly and violently that it wrecks the economy?

Please feel free to disagree strongly and spiritedly with each other. But hopefully we can do it with civility and without straying from the core issues that affect those of us who are FIREd and those of us in the Quest for FIRE.

Thanks!

 

[dex]

Please feel free to disagree strongly and spiritedly with each other. But hopefully we can do it with civility and without straying from the core issues that affect those of us who are FIREd and those of us in the Quest for FIRE.

I can agree with you.
The party is over.
Elvis has left the building.
The fat lady is beginning to sing.
The Vandals are at the gate.
Romulus Augustus is in our not too distant future.

All we have left is hope - hope is not a good thing. Hope is what you hang onto after all you tried has failed and you do not have any new ideas.

Hoping that I have enough money to survive the market downturn and those mutual funds will have the same buying power as today.
Hoping that social security will be there for me at 62 and those dollars will have the same buying power as today.
Hoping that financially, everything holds together until I die.

All empires rise and then fall. That process has been speeding up.
Spanish
English
United States

A little down, I know, but if someone can see a how the USA is not on the downward slope please make your case. The historical parallels are there that we are in decline.

 

[REWahoo]

Geeze Louise. Dex, you need to see if Rich can prescribe you some antidepressants...

 

[HFWR]

Geeze Louise. Dex, you need to see if Rich can prescribe you some antidepressants...

Or, lacking that, give me some...

I'm generally pretty skeptical - some would say cynical - but if we have 10% unemployment, it means we have 90% employed. Similarly, if 30% of kids don't finish high school, it means 70% did. Stocks are on sale!! Must've looked pretty bad during the darkest days of the Revolution, the Civil War, the Great Depression, etc., yet we stumbled out of them in spite of ourselves. So, we just might make it...

 

[ziggy29]

Must've looked pretty bad during the darkest days of the Revolution, the Civil War, the Great Depression, etc., yet we stumbled out of them in spite of ourselves. So, we just might make it...

Maybe. But perhaps "this time it's different" because in those prior national emergencies we didn't have CNBC, 24-hour cable news or the blogosphere to remind everyone 24/7/365 about how we're all doomed.

 

[REWahoo]

Maybe. But perhaps "this time it's different" because in those prior national emergencies we didn't have CNBC, 24-hour cable news or the blogosphere to remind everyone 24/7/365 about how we're all doomed.

OTOH, when the winds change and the inevitable next bubble begins to inflate, the same heralds of doom & gloom will trumpet "Dow 20,000". I see it as 'pump and dump' journalism on a global scale.

 

[ziggy29]

OTOH, when the winds change and the inevitable next bubble begins to inflate, the same heralds of doom & gloom will trumpet "Dow 20,000". I see it as 'pump and dump' journalism on a global scale.

Boring, orderly markets that make investors sleep well at night don't get ratings.