The Federal Reserve created the housing bubble, you stupid mook.
CNN Poll: 53% of Democrat Voters Want Someone Other Than Hillary
- Thread starter Tsing Tao
- Start date
The Federal Reserve created the housing bubble, you stupid mook.
Not to mention the fact that we have "corrections" like the one we're going through precisely because of the Fed's actions, not in spite of it.
Piezoe is a cheerleader, and a clueless one at that.
False. The bubble was fueled by a worldwide excess of desired savings (incl. petrodollars), read, lack of investment opportunity. That's why the whole world suffered when the bubble popped. The ordinary and historical rate of growth of the money supply fell to zero in those years.
Feddunnit don't hunt anymore.
To simply and broadly say the Fed being blamable is "false" in one general broad stroke is as foolish as saying it had everything to do with it.
There were many contributing factors, and rates too low for too long were just one of them. When the head of the Fed at the time said "I see no bubble" in 2005, or the head of the Fed before that encourages people to get into ARMs, the Fed is not part of the solution. Being part of the solution is what the Fed is supposed to be.
Re simplification, I responded to what I saw. I also considered adding an insult since that was part of his reply. (But I agree with you.)
Rates were "too low" largely because of that worldwide excess of desired savings. Until a new war, or a new technology, comes along to soak up all this lonely capital, the situation will persist.
or because taxes were too high and rates were too low to "incentive" investement over savings.
excess of desired savings is a very tortured way to view the problems created by us allowing China to peg the dollar, and the Fed trying to bailout the states and fed govt revenues after the tech collapse by bubbling up real estate. And - wall street pretending crap investments magically became solid investments when combined with other crap investments so they could swindle money out of retirement accounts and have big bonuses.
excess of desired savings is a very tortured way to view the problems created by us allowing China to peg the dollar, and the Fed trying to bailout the states and fed govt revenues after the tech collapse by bubbling up real estate. And - wall street pretending crap investments magically became solid investments when combined with other crap investments so they could swindle money out of retirement accounts and have big bonuses.
One day the Fed will wake up and realize that higher rates actually encourages spending on main street through reliable returns (pensions, savings, interest, etc) and also encourages sound corporate behavior (because risk is properly priced - thus opportunity costs and decisions on where to invest come into play rather than just throwing gobs of money around until something sticks).
I already know we can't tax ourselves, or spend ourselves into prosperity, but I never realized we can simply raise ourselves to prosperity. A good, strong vibrant economy should have reasonable interest rates, so let's just start there.
Soo...reasonable interests rates to you are ZIRP? Reasonable is when the stock market falls a thousand points on the fear or a tiny little pip squeak .25bps hike?
Do you even know what the word "reasonable" means?
Did you ever hear the phrase (coined by, I think Einstein) that said "compound interest is the 8th wonder of the world"?
little
well isn't that the question? What is a reasonable rate? How will we ever know? Will Janet suffer from "empty nest syndrome"? She's been so use to taking care of our every little need. Hard to believe her own little boys are now grown men and moving out to set their own rates.
Last edited: