Financial crisis

[RWB 0]

I wonder how the amount of food we export compares to the amount we import and what the change in exports/imports have been in the last 5/10/15 years or so. Just curious.

 

We certainly aren't the biggest exporter of rice anymore. And why does so much of my food have a label saying it comes from another country. Of course agri-business is good business, right. Never mind that the family farm continues to go away.

 

If we can build all our needed goods then why don't we, because big business makes more money from the cheap labor overseas, and big business could give a damn less about America's future. Where are all the steel mills? Why do I get somebody from India if I need help with a computer problem? Why is the US Air Force buying a tanker from another country? Why did the armed forces go with Beretta 9mm when the Gov't Mod 1911A1 .45 is still the best gunfighting pistol around, ok ok I am a bit partial .

 

I have to agree with the tree hugger part, we have the technology to get the oil out of the ground without destroying the environment, but again, money money.

 

America is entirely too dependent on other countries, esp countries that hate us.

[Gary 4,066]

One of the major problems as far as taxes is that it is far too complicated. The first thing is that corporations should NOT pay taxes. People should pay taxes. Get rid of all the bullshit loopholes that the CEO's are able to squeeze through. Corporations don't earn money, people earn money.

[nidnoyham 30]

I grew up in farm country, back in the 60's we grew more rice here than anywhere else. Now I don't think we have 10 rice farmers left. On top of that even if rice farming once again became profitable, the land is gone. Most of it is now developed, and the poor idiots can't understand why the water gets so high in their neighborhood, ugh duh you built in a rice paddy dummy. Some land has been reclaimed by the marshlands also once it hasn't been farmed for a few years the federal gov't won't let it be farmed again.

 

This area is one of few in USA that is really booming, we live and die here by oil, esp now that farming is gone. No morgage failures here, just more and more building. The refineries are expanding and hiring hiring hiring, unfortunately many are not americans, seems that most american workers want just a bit more of a living wage. They will just have to learn to live just a bit more frugally now won't they. Just shut up and do what the nice guys in management tell you, oh yea forget that retirement, health care, and don't mention the bad bad word, union.

 

We owe China how much now, they own us, our manufacturing base is going going gone, our oil industry is owned by foreign investors, not americans, our jobs are being outsourced faster than you can blink your eye, the gov't outsourced a tanker for our air force to a subsidized foreign company(not the only outsourcing for our military), asshole bill gates wants more cheap foreign labor, and in general the american worker has forgotten why labor unions were so important.

 

If you think things are bad now, wait until oil changes to the euro. We will be ridding Honda Waves to work here.

 

The mccain/repungent health care plan calls for the end of tax benefits for employers and employees for employer furnished health care, one may and I do mean may, get a bit more take home pay afterwards and that is supposed to enable everyone to go out an buy their own. Give me a fucking break!

 

How much does that fucking war cost? Tell me again that it doesn't make any difference in the economy, how much fuel alone does it burn up? we are being ripped off left and right by kbr etc with the blessing and best wishes of the traitors in DC. to hell with that, what is the long term human cost?

 

We can't grow our own food, manufacture our own products, build our own computers, or do our own work. But we can still pay out the ass for foreign oil, at least for today.

 

Excuse me, the demo congress has nothing to do with all this, it has been coming for about 7 years now. This has all happened on the shrub regime's watch. The repungents don't give a damn about anything but money, more money, power and more power.

 

Oh yea, I'm pissed at the demo's also, just not because of the economy, because they haven't done their constitutional duty and brought criminal charges against the shrub/rove/chenny regime.

 

Damn, that felt good! This being sober crap is rough sometimes, but my liver thanks me (I hope).

 

Was watching a financial expert discussing the dollar's demise against other currencies. He said the GBP will not be able to hold it's value, due to our economy being so similar to the US. I wasn't sure what he meant, but having read your post, it has become a bit clearer.

 

Our most famous prestigious cars are now all foreign owned, same as our airports, water companies.....

 

Anyone with a history stretching back more than 30 years, can feel justifiably betrayed by present politicians. Recent arrivals must think our politicians are great - all that equality handed out in the work place and benefit wise- all within a few decades. You haven't paid into the system ? No problem, as long as you work cheaply, it will be fine. The indigenous population had to struggle for centuries to get the working conditions we/ they enjoy today.

 

How does that song go ? " All in all, you're just another brick in the wall ! "

[tko 219]

tko, somehow I bet you get all your news from faux news, rush limbaugh, and billo. If you can't see the crimes that have been committed you have a problem with law, the Constitution, the Bill of Rights, and criminal procedures. You, sir are part of the problem, not the solution. The shrub regime all belong in Git Moe or one of their secret CIA prisons. A little waterboarding each day for the rest of their miserable lives would be most appropriate.

 

Unsurprisingly, for one with your political views, you'd be entirely wrong with your bet. I get most of my news from a wide variety of sources on the internet. FOX news, like CNN, is mostly a bunch of filler that isn't worth the time. The only reason folks like you hate FOX news is because they allow a few conservatives on the channel, and lefties don't like other opinions to be heard. I may listen in on Rush Limbaugh maybe once or twice a year. He is entertaining, but I work during his show. I don't know who or what "billo" is.

 

No matter how much you wish it was true, the administration has not commited a crime, and that is why no serious Democrats are pursuing criminal charges. The willful ignorance of history, fact and the law necessary to support your hate of all things the President does is amazing to the sane amonst us.

 

I'll agree with you on one point, though. I'm am part of what you see as a problem. I and many like me who want to keep more of what we earn, and who believe "the government that governs least, governs best." I am pretty dissapointed with the current administration and many Republicans in congress, as on economic policy other than taxes, they might as well be, as BigusDicus says, "drunken Democrats."

 

 

 

 

One of the major problems as far as taxes is that it is far too complicated. The first thing is that corporations should NOT pay taxes. People should pay taxes. Get rid of all the bullshit loopholes that the CEO's are able to squeeze through. Corporations don't earn money, people earn money.

 

Corporations don't pay taxes. They pass those costs, like all their other costs, on to their customers. Every business must. Taxing corporations is just a way to hide the fact they "we the people" are paying more taxes every time we pay for goods and services.

[Owen` 2]

FYI, the US stock markets closed up 4% today, largest gain since 2002. The overseas markets will follow in lockstep when they open in a few hours.

 

Markets fluctuate. With this move the market is down from its all time high about 15%. The bottom of the 2000-2002 (which started under Clinton, btw) decline was -48%.

 

Financial reporters write their articles to win awards and hold attention so advertisers get seen. They do so on the way to lunch or home for the day, on deadline. They aren't the fount of genius. Neither are the people they quote in their articles, who usually were the only people at the number they dialed who were not so busy doing productive things that they had time to answer reporter questions.

 

When it comes to financials, just look at the numbers and ignore the text.

Edited March 18, 2008 by Owen`

[nidnoyham 30]

Owen, you can probably put me right if I have it wrong, but isn't 'Sub - Prime Lending', just modern jargon for old fashioned Usery ?

 

Edward 1st ( the bad guy in the film Braveheart ) outlawed it in England over 750 years ago. The charging of huge interest on loans to poor people was considered to be a bad thing even then.

 

Ironically, if Muslims were in charge of the wests banking system today, their religion forbids interest being charged to the poor. They must be having a right chuckle to themselves about the present situation.

 

Pure greed has bought this about, lending money at high rates of interest to people who can ill afford to pay them. It was OK when rates were historically low. Then the rates increased and people lost their homes.

 

Whoever runs these huge banks, creating these 'Sub Prime Lending' policies, need their arses kicking.

 

O.K put me right, but do it gently.

[js007 795]

Owen, you can probably put me right if I have it wrong, but isn't 'Sub - Prime Lending', just modern jargon for old fashioned Usery ?

 

Edward 1st ( the bad guy in the film Braveheart ) outlawed it in England over 750 years ago. The charging of huge interest on loans to poor people was considered to be a bad thing even then.

 

Ironically, if Muslims were in charge of the wests banking system today, their religion forbids interest being charged to the poor. They must be having a right chuckle to themselves about the present situation.

 

Pure greed has bought this about, lending money at high rates of interest to people who can ill afford to pay them. It was OK when rates were historically low. Then the rates increased and people lost their homes.

 

Whoever runs these huge banks, creating these 'Sub Prime Lending' policies, need their arses kicking.

 

O.K put me right, but do it gently.

 

The term "sub-prime" doesn't really imply that those particular loans were usurious, but simply that the loans were made to "sub-prime" borrowers. They might have been charged an extra 1/2 point on the loan to cover the extra risk. Or maybe, they got a "no doc" loan and were thereby free to lie about their income and assets, and again, were charged an extra 1/2 point or so for that privilege. In any event, the net result was overpriced real estate for everyone and a bunch of people who can't afford to pay their loans. Their houses go into foreclosure and are dumped on the market, lowering the comparable home prices impairing the security for all real estate loans. Also, over the past 10 years or so, people used the increased value of their homes as an ATM of sorts, but because of the decreasing real estate values, that source of cash is no longer available to many. In short, there's a credit crunch and the banks are on the verge of failure.

 

It's all fun to watch, but the Fed is screwing everything up by trying to rescue the banks. That causes inflation and kills the dollar. Less baht to fool around with.

 

J

[joekicker 53]

Owen, you can probably put me right if I have it wrong, but isn't 'Sub - Prime Lending', just modern jargon for old fashioned Usery ?

 

No. Usury is outlawed and rarely exists in any banking system anywhere any more. Although I certainly think you can make a pretty good argument about usury in the North American (and more so Thailand) credit-card business under some circs. Max out your credit card, miss the next payment, and see what I mean.

 

Sub-prime mortgages were indefensible in my view, and attracted the smarmiest salesmen who probably could only get jobs in Thailand selling Pattaya time-shares -- but not because they were usury.

 

Ironically, if Muslims were in charge of the wests banking system today, their religion forbids interest being charged to the poor. They must be having a right chuckle to themselves about the present situation.

 

This is the second time I've seen this in a couple of hours. I saw it a couple of days ago in some rag and I wonder if that's where everyone is getting it -- a meme running rampant. It's wrong.

 

Islam forbids charging interest - period. It has NOTHING to do with the state of the recipient of a loan.

 

Still, there are Muslim banks, including one with Bangkok headquarters, and they make money by accumulating money and using it to make loans. And they foreclose on homes and businesses, etc. But they do NOT charge interest including on loans to the emir of Qatar, say.

[Owen` 2]

SubPrime mortgages.

 

Well, here's the deal for you UK guys. In the US (and not in Canada), interest paid on the loan used to buy your primary residence is tax deductible right off your income. The US real estate industry got this stuck into US tax law decades ago and it is now sacrosanct. If you pay $5000 in mortgage interest and you made $70,000 last year in paychecks, that 5,000 comes right off the top and makes the number 65,000 (before all sorts of other maneuvers take place). This means a home mortgage is subsidized by the US government.

 

The financial industry went out and found borrowers who might not be able to qualify for other sorts of loans and persuaded them to borrow under these various "sub prime categories. Sub Prime refers to the quality of the borrower, not the quality of the bank.

 

There is all sorts of talk going on as the various interest groups involved with this try to mold public opinion. One of the first things to do when you are trying to understand this is do a very quick translation of a simple phrase when you hear it. "Home owner". That is the way things are phrased right now. Home owners are losing their homes. It's not true in the sense that it is not the majority. The majority are "house owners". When you hear any discussion of this matter, translate all occurrences of the phrase "home owner" into "house owner" and the nuance appears.

 

The majority are flippers. They are real estate investors. They had 4 or 5 houses they had bought hoping for a continued big price rise and they would just flip that house over to someone else, take the proceeds and buy another . . . or another two. Because they were so heavily in total debt, they fell into the category of poor quality borrower. That put them into the sub prime arena and those are the sorts of mortgages they got. Also, in point of fact, most were lying to the US government about the houses with respect to "primary residence". ALL, no exceptions, ALL declared the house with the biggest morgage interest to be their primary residence regardless of where they actually lived. Some . . . some cheating number of them declared multiple placess to be private residence by filing multiple returns.

 

So these people are facing the situation where the price of the house has fallen lower than the remaining loan (mortgage) on the house. In rational times, the law would say that they borrowed the money, they must pay it back, and the house's value is at best ancillary to that obligation. Unfortunately, some state legislatures were paid off by the real estate industry and embedded laws saying that if a house value dropped to less than a mortgage, the owner could walk away and the bank could not pursue them. Thus, the banks are left holding the bag and that investing category of people essentially were speculating risk free.

 

And worst of all, California has this law. Biggest state in the US and they are letting flippers walk away owing nothing for their speculation.

[js007 795]

In California, it's known as the "one form of action" rule, and has been around for a long long time. In short, if they sell the house at auction under the deed of trust, they get the proceeds of the sale and cannot go after the borrower for a deficiency judgment. It's tricky, though. This rule usually applies to just the original purchase money loan. The theory was that the lender was well able to appraise the value of the underlying asset. It was thought that such a rule would dissuade lenders from making imprudent loans. Of course, lenders packaged the loans and no longer cared, but that's another story.

 

California is one big mess.

[ginseng 0]

A better term is home debtor. Until you are free from the bank you are in debt. You may or may not build up equity but that doesn't change the fact you took out a loan to buy something you don't have the cash for. If you have a mortgage.

[Owen` 2]

Be all this as it may be, my overall point is that there is nothing new under the sun. There have been financial crises in the past, and there will be more in the future. The US markets are only down 15% from their all time high, reached just a few months ago.

 

Guys, 15% is not a huge move. The hyperbole we are hearing about the end of the world is coming from people who want their own annual bonuses funded by a government bailout. So far, it's not happening. Every Fed action taken of late has been, in effect, a 30 day loan. All the talk about "providing liquidity" has been made for consumption by people who don't look deeper. Yes, the Fed is providing banks access to money, but the money provided must be repaid in 28 days.

 

There is no net influx of money into the system. It is phrased to sound that way, but that is not what is happening.

 

Those annual bonuses, so far, are not getting funded by the taxpayer. This is a good thing.

Edited March 19, 2008 by Owen`

[lostinpattaya 0]

Be all this as it may be, my overall point is that there is nothing new under the sun. There have been financial crises in the past, and there will be more in the future. The US markets are only down 15% from their all time high, reached just a few months ago.

Wise words Owen .In the Oct-Dec quarter last year the US economy still had positive growth .Even if the March quarter shows a decline and potentially the start of a recession it is still at the moment at least very minor compared to other recessions.Many current investors and commentators remind me of spoilt children who want everything their own way all the time. Stock markets go up and down ,economies go into recessions-if you can't accept that then don't invest in the market ever.As a great Australian said Life was not meant to be easy.

[nidnoyham 30]

Thanks Owen -JS.- Joe....

 

We too had tax relief in the UK, paid on mortgage interest and on insurance premiums to finance a mortgage. My first mortgage in 1979 had both tax concessions, Mr Brown soon stopped them.

 

I wanted to compare the Usery to Sub Prime to illustrate Owen's comment about 'nothing new in the world.'

 

Usery may be illegal Joe, but so is prostitution in Thailand. As far as the C.Cards go, that is outrageous profiteering, I get an offer for one through the post every week. Bank rate 5.5%, interest on C.Card 19.9% +. Not a bad mark up.

 

No I didn't read about Muslim banks in some rag recently, it was an article in The times some while back about two Muslim banks opening branches in the UK to cater for Muslim house buyers who were uncomfortable dealing with our banks ( at least we have that in common ! )

 

So basically, the banks in America, were handing out mortgages while rates were low to people who were a bit ' iffy', knowing that they would get a higher return on these mortgages, plus if the Joe Schmo couldn't keep up the payments, they would then reclaim a house worth more than the initial outlay. They then sold these high interest deals in blocks of hundreds or thousands at a time, in packages to other banks.

 

When interest rates rose, too many people bailed out causing a crash on property. the money stopped coming in on the loans and the houses were worth less than the original outlay.

 

I have never been happy with people using houses-homes, to make large sums of money. Luxury items are fare game, but a home is not a luxury, it is a basic need for all.... man , beast and bird.

 

It's just a pity this mess could not be restricted to the Banks alone. It would appear some are making a killing on buying others at a knock down price. Every cloud has a silver lining.

[kimchikid 0]

jeez

 

i wanted to know how touristman really felt about the people who come from the United States of America

 

guess i will have to wait untill 2039 or was it 2031?

[wacmedia 277]

Why is the US Air Force buying a tanker from another country?

 

Hi,

 

I can answer this one.

[Eneukman 1]

One of the major problems as far as taxes is that it is far too complicated. The first thing is that corporations should NOT pay taxes. People should pay taxes. Get rid of all the bullshit loopholes that the CEO's are able to squeeze through. Corporations don't earn money, people earn money.

 

If corporations didn't pay taxes, the taxes payable by individuals would be sky high.

 

If corporations don't earn money, where the fuck does my dividend income come from if not from the PROFIT made by the companies whose shares I own?

 

Alan

[tko 219]

Financial reporters write their articles to win awards and hold attention so advertisers get seen. They do so on the way to lunch or home for the day, on deadline. They aren't the fount of genius. Neither are the people they quote in their articles, who usually were the only people at the number they dialed who were not so busy doing productive things that they had time to answer reporter questions.

 

When it comes to financials, just look at the numbers and ignore the text.

 

A perfect example: On the drive home everyday, I listen to CBS news radio. Everyday, without fail, they will say which way the markets moved, and state that it was because of some single item of news that day. They want us to believe that millions of investors around the world made the decision to buy or sell the various stocks they were interested for the reason they select.

 

"When it comes to financials, just look at the numbers and ignore the text."

I like it!

[briar 27]

Islam forbids charging interest - period. It has NOTHING to do with the state of the recipient of a loan.

 

Still, there are Muslim banks, including one with Bangkok headquarters, and they make money by accumulating money and using it to make loans. And they foreclose on homes and businesses, etc. But they do NOT charge interest including on loans to the emir of Qatar, say.

 

I've heard this also, that Muslim's dont charge interest.

 

I wonder how the Muslim banks make money on loans without charging interest? Do they charge a flat fee equal to interest they would have normally earned.

[briar 27]

Why is the US Air Force buying a tanker from another country?

 

I heard that the tanker deal with Northrup Grumman and Airbus would bring 1500 high tech jobs and a wad of investment money to Mobile, AL. Is this a bad deal for American workers?

 

Same for when Toyota or Nissan moved their plants to the USA. They brought thousands of high paying jobs to America directly through their assembly plants and indirectly through parts supplier manufacturers. Does it really matter who you work for as long you have a decent paying job and good benefits?

[carbine 0]

I beg to differ with the assertion: "The reality is that the U.S.A. is still by far the most influential country in the world".

 

Have you been to China recently?.

 

For far too long the books of the U.S.A. have been "cooked" to disguise the fact that the value of of what was seen as assets has been artificially inflated on the back of cheap credit. Now that some parties are (rightly) declining to participate in the charade of "pass the parcel" ("asset"), the supply of credit is evaporating and the economy is unravelling. This has caused pain for not only the U.S.A. but other countries which cannot avoid "catching a cold when Amercia sneezes". Unfortunately, this is the extent of the remaining influence of this former great power.

 

I realise that this post will win me few friends because my opinion is not what most people want to hear. In fact, some time ago on this forum I opined that severe problems were looming but merely copped a warning for my trouble.

 

History will record that :

 

The "century of the U.K." has passed.

The "century of the U.S.A" has passed.

The "century of China (and, to a lesser extent, India, Russia & Brazil) has begun.

 

 

 

 

Its not a question of a depression its a recession.

 

No chance of a real depression in the US. The world would fall apart.

 

The reality is the USA still is by far the most influential country in the world. Those who politically want to ignore this influence just have decide how much suffering and poverty their people will accept.

 

Because its the USA that calls the shots and will for the foreseeable future recession or no recession.

 

The US consumer is responsible for 20% of the worlds spending.

 

One country = 20% of all the worlds spending power.

If it stops spending the shit hits the fan.

 

Any currency that gains on the back of wankers panicking over the pressure on the dollar will lose big time in the end (Europhiles take note).

 

The Euro is so high that soon they wont be able to sell fuck all to anyone at cost. Especially to 20% of the worlds spenders ie. Americans.

 

The £ is well over $2 dollars now. Its still great for our exports to Europe.

Not that I would sell them anything after the Germans bombed our chip shop and broke all our window.

 

Its not a matter of politics in the USA. Its not the war in Iraq (such as it is). Its all a matter of economics and the room for maneuver by any US political policy is limited.

 

Pulling troops out and global warming are bollocks.

The former is inevitable its a matter of how flimsy the excuse and the benefits and costs are human not financial.

The latter is just a way of raising revenue.

 

The greatest influence is economical balance and corporate greed. That's what causes these peaks and troughs. Its the nature of free economies.

 

Defence spending is actually beneficial in many ways. Its lack of spending and lack of credit that causes recession.

Its inevitable that these issues will be used to make political points but reality is that if you stop these fluctuations you have to change everything and its not going to happen as more control means less freedom.

 

Those that want freedom should win the day.

[Owen` 2]

If corporations didn't pay taxes, the taxes payable by individuals would be sky high.

 

If corporations don't earn money, where the fuck does my dividend income come from if not from the PROFIT made by the companies whose shares I own? banghead.gif

 

Alan

 

Eneuckman, this is another quirk of US tax law driving Gary's comments about this.

 

Corporations are taxed on their profit in the US. Some portion of what is left after that taxation is paid to individuals as dividends. And then the US tax laws declare this to be income to the individual to be taxed at his individual tax rate.

 

Dividend dollars are taxed twice in the US. "Double taxation of dividends" has been complained about and ignored for decades. Recipients are the filthy rich, you see, and deserve to have all of their assets taken away to fund the lives of people who prefer to spend their time standing on street corners talking to their friends.

 

It is my understanding this double taxation thing is rare elsewhere around the world.

[Eneukman 1]

Eneuckman, this is another quirk of US tax law driving Gary's comments about this.

 

Corporations are taxed on their profit in the US. Some portion of what is left after that taxation is paid to individuals as dividends. And then the US tax laws declare this to be income to the individual to be taxed at his individual tax rate.

 

Dividend dollars are taxed twice in the US. "Double taxation of dividends" has been complained about and ignored for decades. Recipients are the filthy rich, you see, and deserve to have all of their assets taken away to fund the lives of people who prefer to spend their time standing on street corners talking to their friends.

 

It is my understanding this double taxation thing is rare elsewhere around the world.

 

Thanks for that explanation.

 

At present, in the UK dividends are paid with a tax credit attached of 10% (e.g a dividend of £90 has a tax credit of £10 - this used to be 20% until Gordon Brown changed the rules). If you pay tax at the basic rate you have no further liability. If you fall into the higher rate tax bracket dividends are taxed at the rate of 32 1/2% of the gross dividend.

 

Alan

[Gary 4,066]

If corporations didn't pay taxes, the taxes payable by individuals would be sky high.

 

If corporations don't earn money, where the fuck does my dividend income come from if not from the PROFIT made by the companies whose shares I own?

 

Alan

 

Of course individual taxes would go up. That's as it should be. Before I buy a stock, I always look at how much the big shots make. Not earn, but what the actually take out of the company. Many make absolutely obscene amounts of money. Dividends? Since the company would pay no taxes, YOU would make much higher dividends, but you would be taxed on them the same as the big shots who make the obscene money. As far as I am concerned, no man is worth ten million a year and that is a LOT less than many of them make. Let them pay the big taxes on their obscene salaries.

[BigusDicus 9,415]

I beg to differ with the assertion: "The reality is that the U.S.A. is still by far the most influential country in the world".

 

Have you been to China recently?.

 

The reality is China just is not all that big - yet.

 

I posted the article below around the beginning of this year. It is an interesting read.

 

http://www.latimes.com/news/opinion/sunday...nday-commentary

 

 

I apologize for my redundancy......