Friday, February 13, 2009


Is the current economic crisis a conspiracy of a band of international bankers? That was the theme of tonights talk. I appreciate Davids efforts and his stepping up to the plate to put on tonights discussion. The gist that I got is that the current economic problem is a international conspiracy of bankers. Is it? He showed a movie that says that it is. There are some problems with the hypothesis however. Historically, WWI, WWII and Vietnam were not conspiracies to make money. There seems to be same partial truths and half truths in the movie. I am not an economics expert, but historically there are some real problems. WWII was not conspiracy by the bankers and Rooseveldt to get the US in war. True Churchhill and Rooseveldt talked about getting the US in, but it was how to do it against Germany, not Japan. That was a blind side that FDR got. His policies in the far east was to get Japan to withdraw from China. Vietnam was a mud hole because politicians were trying to run the war, not the military. It forced Johnson not to run in 68. 911 was not a conspiracy by the Bush administration. This is a conspiracy theory by the Truthers. Which they are not. Michael Shermer resoundingly puts that one to bed. The current economic crisis is based on pure greed and chaos theory. The honest goal was to try and get more Americans to own homes. The vehicle was no money down adjustable rate loans that were then bundled and sold over seas. The loan officers got bonuses for selling more loans and that led to a snow ball effect. When you sell a loan to someone who cannot afford such a loan the chickens as they say will come home to roost eventually. And that is what is happening now and it is causing a domino effect on other businesses. Historically the Great Depression started with the crash in 1929 based on greed in selling based on credit with no money to back it up. The stock market did not hit bottom until 1932. It lost 80% of its precrash value. It didn't recover its precrash value until 1954. The stock market until it hit bottom was having little gains then loss, then stable then crash, then gain, the crash, then stable, then loss, then gain, then crash etc, until it hit bottom. If we apply historical numbers to the market today that means the stock market will not hit bottom until the DOW hits 3500 in 2011. It is showing ups and downs now. If history is any marker then it will not recover until 2033. The great depression required WWII. If this crash requires a war there will not be any one left to see a recovery. The great depression saw an unemployment rate of around 25%. We are at 7%. To let the free market operate will cause mass unemployment and chaos. Same kind of conditions that brings dictators to power, Hitler is one who did just that. A party wants to let the free market operate. It is purely idealogical. They see life as a flat earth and do not see the other dimensions. Let us hope Obama's recovery package works!

Skeptical Dodo

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