Volconvo is a debate forum for the discussion of political, religious, and news-based topics.

HelioPrime · Jan 21, 2008, 02:34 pm

Head to any news site and articles with fears of a US recession will be in the top stories.

Rather than debate the merits of a story how about the situation as a whole. Thoughts on if the fears are overblown, or if the Bush response is going to do anything?

Personally I like to idea of more tax rebates, I miss the 1000 I got that one year as an incentive to stay in school. I don't know enough about the situation to say if the tax rebates will really stimulate the economy but then again I think the fears are mostly overblown. I feel this is the just the result of what happens in a world where resources are peaking and increasing in price. It bleeds down into everything.

What is your take or is it all just paranoia?

Compugasm · Jan 22, 2008, 03:05 am

Tax cuts or incentives are preferrable to rebates. The idea is, a tax cut encourages saving. Over time, you get more money "in your pocket" through a tax cut. Because it is a permanent benefit you receive every year. An incentive is... well, doing something and getting the reward for the effort.

A rebate is a handout to promote spending. The idea there, is simply to drive up demand for goods (through consumption). It does very little as a long term solution to an empty wallet. A rebate is like a loan, which the government gets back at the end of the year through taxation. Example, as the $1000 you spent passes from hand to hand, each entity which received a portion of those dollars, is taxed. Rebates do not create new jobs or lower prices.

Example, If we get a rebate in 2009, news stories will report the best Christmas season ever, because people will spend the rebate on crap. But that doesn't mean the economy has grown. The "growth" there, is just a spending increased. Does that make sense?

Derach · Jan 22, 2008, 09:42 am

The fundamental problem is with banks having been irresponsible in lending ... and insurance companies overextending their promise of protection to the banks and their mortgages. There isn't enough money for consumers to repay rising interest rates on mortgages, and the insurance companies don't have the capital to protect the banks from their own bad decisions.

Far from being overblown, this problem is underreported and the lack of attention afforded it by presidential hopefuls only proves that, yet again, American politicians are of the same elitist mold that have NO CLUE as to 'real world' implications of the market forces at work here now.

The housing market fuels our economy and unless the insurance/banking/mortgage problem is fixed fundamentally, we will steamroll through a recession into a full blown depression .... we will have 100% inventory on housing, people will lose their homes to banks and they will be worth a tiny fraction of what is owed on the mortgage. It will take a generation to come out of it. Tax rebates or cuts will be like putting a band aid on the stump of a missing limb.

The only way to solve a problem like this, that is the result of several parties acting irresponsibly, is to hold all parties responsible for the 'righting of the ship' ... First of all, we tell the insurance companies that they're only liable for 50% of the defaulted mortgages that will occur over the next 18 months (extimated cost of 240B) ... we then turn to the banks and say ... 'sorry ... you're only going to recover 50% of your defaulted mortgage losses' ... we then soften the blow by reducing the liability to consumers unable to pay back mortgages by 50%. Then the system is fixed for good and we can move on ... banks can lend money, building can resume, people can buy/improve their houses.

I would also temporarily close the real-estate speculation market so greedy people don't get into the same habits of 'fuzzy math' to justify huge unsecured (or undersecured) loans.

That's the pill to swallow .... it won't be easy, but it doesn't cost any more than a massive tax cut or rebate plan and it addresses the core issues at hand (which a rebate does not do).

You said you 'miss the $1000' you got a few yrs ago ... well the point is that $1000 didn't really help the economy cuz we're still here now. If you hadn't got that 1000, and interest rates were stable, and we had an energy plan, and the economy as growing and the stock market was healthy ... you probably would have many thousands of dollars more than you do now (either as a result of investment, higher salary, or reduced energy/inteest expenses).

Don't fall for Bush's quick feel-good 'solution' (it's not a solution, it's delaying and worsening the inevitable) of throwing a few bucks your way now only to rob you of thousands later.

This instant gratification mentality is what got us into this mess (no money down!! ... 0% interest!! ... for now)

HelioPrime · Jan 22, 2008, 07:34 pm

I'm surprised nobody else has anything to say or share?

People believe in 9/11 conspiracy's and denial of RP victories but they don't care to debate on the national economy?

lsbskins1 · Jan 22, 2008, 07:55 pm

The other issue at play is that Americans are using debt to pay for what increasing salary and sustainable growth used to pay for. When you increase profit by depressing wages, it makes the company appear to be successful when what is really happening is that the company is sucking the life blood from the economy. Workers have to be able to afford the products and services being sold. Joe Millionaire CEO will not buy 30 copies of the same cookbook or 30 toasters or hire 30 different lawyers to write the same damn will. But if you took that money out of his bank account and put it in the workers bank accounts, they would stop using visa to pay for groceries and toasters and cookbooks, and put the engine back in drive. It is all symptomatic of the same disease. Growing the pie is not enough. 'Cause one guy can only eat so much pie. After a time, he is only putting it in a huge freezer, where it stagnates, feeds nobody but does look really impressive to his buddies.

Derach · Jan 23, 2008, 09:17 am

Isb - great point ... love the line:
"one guy can only eat so much pie"

Helioprime - the lack of traffic on this thread is proof that people know more about quantam physics and the likelihood of extra-terrestrial life than they know about how to make money and sustain a lifestyle. We have been lulled as a society into a trance-like oblivious bliss when it comes to Western economic principle.

But let's worry about whether other people should have abortions or believe in the Bible .... WAY more pertinent information there than in securing your financial future.

commonsense · Jun 2, 2008, 02:09 pm

Hi. I havent posted on Volconvo for years! I'm trying to get a new hobby. I was hoping those of you responding to this thread might be able to help me out, or refere me to a good chatroom related to investing.
I'm new to investing in general, am considering some light trading and mid-to long-term ETF investing and would like to make my research/education efforts more time-efficient as I choose an online broker and browse sector ETFs.

Has anyone tried zecco ?
I also want to browse for ETFs by individual holdings I am interested in... for example, search a stock symbol and see if it appears inside an ETF.

Any suggestions? I've only been studying for a week or two, and am running into road blocks in my research and want to open an account soon... all the investment concepts I've had in the back of my mind for years before coming into this sum are rapidly becoming buzz words and I'm anxious to open a brokerage account.
I'm very concerned with eliminating expenses b/c I'm a small investor and don't want trade fees to destroy my gains.
Any good general reading suggestions?
Thanks!

Apeman81 · Jun 2, 2008, 04:37 pm

I disagree to a degree, in that the debt is created to by wants, not needs. They want the 50” Plasma TV. They want the shiny new car, the upgraded computer, the name brand clothing. More young people are using debt to allow them to move out of the family home into their own with all the amenities, instead of an small apartment with a 19’ TV and used appliances.

As for taking from the “rich” and giving it to the “poor”, that fails as the disincentive to manage the companies from which their wealth came decreases the company’s ability to create wealth. Which reduces the secondary wealth generated by the company in the form of stock and bond dividends, which we own as part of our retirement investments.

Just like our government should learn, fiscal responsibility and living within our means is the more needed change in our society.

Jan 21, 2008, 02:34 pm	#1 (permalink) (top)
HelioPrime Hucking Fuskies Location: Conn Posts: 2,184	State of affairs - United States Economy Head to any news site and articles with fears of a US recession will be in the top stories. Rather than debate the merits of a story how about the situation as a whole. Thoughts on if the fears are overblown, or if the Bush response is going to do anything? Personally I like to idea of more tax rebates, I miss the 1000 I got that one year as an incentive to stay in school. I don't know enough about the situation to say if the tax rebates will really stimulate the economy but then again I think the fears are mostly overblown. I feel this is the just the result of what happens in a world where resources are peaking and increasing in price. It bleeds down into everything. What is your take or is it all just paranoia? The mind forgets but the heart always remembers -Anon

Jan 22, 2008, 03:05 am	#2 (permalink) (top)
Compugasm Son of X51 Location: San Diego Posts: 3,586	Tax cuts or incentives are preferrable to rebates. The idea is, a tax cut encourages saving. Over time, you get more money "in your pocket" through a tax cut. Because it is a permanent benefit you receive every year. An incentive is... well, doing something and getting the reward for the effort. A rebate is a handout to promote spending. The idea there, is simply to drive up demand for goods (through consumption). It does very little as a long term solution to an empty wallet. A rebate is like a loan, which the government gets back at the end of the year through taxation. Example, as the $1000 you spent passes from hand to hand, each entity which received a portion of those dollars, is taxed. Rebates do not create new jobs or lower prices. Example, If we get a rebate in 2009, news stories will report the best Christmas season ever, because people will spend the rebate on crap. But that doesn't mean the economy has grown. The "growth" there, is just a spending increased. Does that make sense? I'd like to thank Charlie Hodge, bringing me scarves and water. Last edited by Compugasm; Jan 22, 2008 at 04:00 am.

Jan 22, 2008, 07:34 pm	#4 (permalink) (top)
HelioPrime Hucking Fuskies Location: Conn Posts: 2,184	I'm surprised nobody else has anything to say or share? People believe in 9/11 conspiracy's and denial of RP victories but they don't care to debate on the national economy? The mind forgets but the heart always remembers -Anon

Jan 22, 2008, 07:55 pm	#5 (permalink) (top)
lsbskins1 Redskins Rule Location: South-Western Virginia Posts: 2,417	The other issue at play is that Americans are using debt to pay for what increasing salary and sustainable growth used to pay for. When you increase profit by depressing wages, it makes the company appear to be successful when what is really happening is that the company is sucking the life blood from the economy. Workers have to be able to afford the products and services being sold. Joe Millionaire CEO will not buy 30 copies of the same cookbook or 30 toasters or hire 30 different lawyers to write the same damn will. But if you took that money out of his bank account and put it in the workers bank accounts, they would stop using visa to pay for groceries and toasters and cookbooks, and put the engine back in drive. It is all symptomatic of the same disease. Growing the pie is not enough. 'Cause one guy can only eat so much pie. After a time, he is only putting it in a huge freezer, where it stagnates, feeds nobody but does look really impressive to his buddies. All I see when I look down, something jumpin' on the ground, Scratchin' dirt, cluckin' in the barnyard - Tell me, could that be you? John Kay

Jun 2, 2008, 02:09 pm	#7 (permalink) (top)
commonsense Igneous Magma Posts: 333	Hi. I havent posted on Volconvo for years! I'm trying to get a new hobby. I was hoping those of you responding to this thread might be able to help me out, or refere me to a good chatroom related to investing. I'm new to investing in general, am considering some light trading and mid-to long-term ETF investing and would like to make my research/education efforts more time-efficient as I choose an online broker and browse sector ETFs. Has anyone tried zecco ? I also want to browse for ETFs by individual holdings I am interested in... for example, search a stock symbol and see if it appears inside an ETF. Any suggestions? I've only been studying for a week or two, and am running into road blocks in my research and want to open an account soon... all the investment concepts I've had in the back of my mind for years before coming into this sum are rapidly becoming buzz words and I'm anxious to open a brokerage account. I'm very concerned with eliminating expenses b/c I'm a small investor and don't want trade fees to destroy my gains. Any good general reading suggestions? Thanks! The Porcupine is a great symbol. READ THOMAS PAINE, "RIGHTS OF MAN" TO A KID

Jan 22, 2008, 09:42 am	#3 (permalink) (top)
Derach Igneous Magma Location: Massachusetts, USA Posts: 312	The fundamental problem is with banks having been irresponsible in lending ... and insurance companies overextending their promise of protection to the banks and their mortgages. There isn't enough money for consumers to repay rising interest rates on mortgages, and the insurance companies don't have the capital to protect the banks from their own bad decisions. Far from being overblown, this problem is underreported and the lack of attention afforded it by presidential hopefuls only proves that, yet again, American politicians are of the same elitist mold that have NO CLUE as to 'real world' implications of the market forces at work here now. The housing market fuels our economy and unless the insurance/banking/mortgage problem is fixed fundamentally, we will steamroll through a recession into a full blown depression .... we will have 100% inventory on housing, people will lose their homes to banks and they will be worth a tiny fraction of what is owed on the mortgage. It will take a generation to come out of it. Tax rebates or cuts will be like putting a band aid on the stump of a missing limb. The only way to solve a problem like this, that is the result of several parties acting irresponsibly, is to hold all parties responsible for the 'righting of the ship' ... First of all, we tell the insurance companies that they're only liable for 50% of the defaulted mortgages that will occur over the next 18 months (extimated cost of 240B) ... we then turn to the banks and say ... 'sorry ... you're only going to recover 50% of your defaulted mortgage losses' ... we then soften the blow by reducing the liability to consumers unable to pay back mortgages by 50%. Then the system is fixed for good and we can move on ... banks can lend money, building can resume, people can buy/improve their houses. I would also temporarily close the real-estate speculation market so greedy people don't get into the same habits of 'fuzzy math' to justify huge unsecured (or undersecured) loans. That's the pill to swallow .... it won't be easy, but it doesn't cost any more than a massive tax cut or rebate plan and it addresses the core issues at hand (which a rebate does not do). You said you 'miss the $1000' you got a few yrs ago ... well the point is that $1000 didn't really help the economy cuz we're still here now. If you hadn't got that 1000, and interest rates were stable, and we had an energy plan, and the economy as growing and the stock market was healthy ... you probably would have many thousands of dollars more than you do now (either as a result of investment, higher salary, or reduced energy/inteest expenses). Don't fall for Bush's quick feel-good 'solution' (it's not a solution, it's delaying and worsening the inevitable) of throwing a few bucks your way now only to rob you of thousands later. This instant gratification mentality is what got us into this mess (no money down!! ... 0% interest!! ... for now)

Jan 23, 2008, 09:17 am	#6 (permalink) (top)
Derach Igneous Magma Location: Massachusetts, USA Posts: 312	Isb - great point ... love the line: "one guy can only eat so much pie" Helioprime - the lack of traffic on this thread is proof that people know more about quantam physics and the likelihood of extra-terrestrial life than they know about how to make money and sustain a lifestyle. We have been lulled as a society into a trance-like oblivious bliss when it comes to Western economic principle. But let's worry about whether other people should have abortions or believe in the Bible .... WAY more pertinent information there than in securing your financial future.

Jun 2, 2008, 04:37 pm	#8 (permalink) (top)
Apeman81 Hot Lava Posts: 1,301	I disagree to a degree, in that the debt is created to by wants, not needs. They want the 50” Plasma TV. They want the shiny new car, the upgraded computer, the name brand clothing. More young people are using debt to allow them to move out of the family home into their own with all the amenities, instead of an small apartment with a 19’ TV and used appliances. As for taking from the “rich” and giving it to the “poor”, that fails as the disincentive to manage the companies from which their wealth came decreases the company’s ability to create wealth. Which reduces the secondary wealth generated by the company in the form of stock and bond dividends, which we own as part of our retirement investments. Just like our government should learn, fiscal responsibility and living within our means is the more needed change in our society.