FDIC Loan Modification Program *Screw the borrower*

[Arraya]

If you look at the capacity for the govt. to borrow and stimulate (go back to WW II and you’ll see federal debt to GDP at 122% – right now we’re at about 70%)

Attempts to reframe the argument in terms of only federal debt are red herrings. First because how we measure “GDP” has changed so dramatically over the years that it’s not really possible to accurately compare federal debt over the decades. Second because federal debt is only 20% of the debt pie.

Ultimately whether the debt is held by a town, a state, a corporation or the federal government it is the labor of individual people that pays it off.

[Arraya]

http://www.atimes.com/atimes/China_Business/JL05Cb03.html

After committing over $7 trillion into the finance sector, the market continued to fail and the economy heading downward. If just $2 trillion of the $7 trillion the government has so far committed for the financial sector were to be channeled directly to the unemployed, each worker would receive $200,000 (the equivalent of four years at average wages) to tie them over their jobless phase to kick-start the economy.

The same amount would support for one whole year 40 million middle-income families with an annual income of $50,000. If government funds were directed towards people rather than institutions, consumer demand will revive immediately and companies will sell again to make profits. The recession will end within 18 months.

But alas, the measures taken by the US government thus far were all designed to save the financial system and its institutions from the penalty of excessive risk rather than to help the economy and its people from the pains of recession. The net result of this top-down approach will be to punish the economy with a lost decade while feeding the cancer of a dysfunction financial system held together by unsustainable debt.

Still, the market-oriented US leader felt the need to adhere ideologically only to a top-down solution. The priority must be to save the dysfunctional financial system and its wayward institutions, while the public must wait for the presumed trickling down benefits, if any. A decade-long depression will be the result.

The leaders of the G20 have a collective responsibility to face the reality of the crisis to save the world economy from total collapse instead of meekly following misguided US rescue measures of adding more liquidity to a crisis created by excess liquidity.

[Arraya]

http://www.atimes.com/atimes/China_Business/JL05Cb03.html

After committing over $7 trillion into the finance sector, the market continued to fail and the economy heading downward. If just $2 trillion of the $7 trillion the government has so far committed for the financial sector were to be channeled directly to the unemployed, each worker would receive $200,000 (the equivalent of four years at average wages) to tie them over their jobless phase to kick-start the economy.

The same amount would support for one whole year 40 million middle-income families with an annual income of $50,000. If government funds were directed towards people rather than institutions, consumer demand will revive immediately and companies will sell again to make profits. The recession will end within 18 months.

But alas, the measures taken by the US government thus far were all designed to save the financial system and its institutions from the penalty of excessive risk rather than to help the economy and its people from the pains of recession. The net result of this top-down approach will be to punish the economy with a lost decade while feeding the cancer of a dysfunction financial system held together by unsustainable debt.

Still, the market-oriented US leader felt the need to adhere ideologically only to a top-down solution. The priority must be to save the dysfunctional financial system and its wayward institutions, while the public must wait for the presumed trickling down benefits, if any. A decade-long depression will be the result.

The leaders of the G20 have a collective responsibility to face the reality of the crisis to save the world economy from total collapse instead of meekly following misguided US rescue measures of adding more liquidity to a crisis created by excess liquidity.

[Arraya]

http://www.atimes.com/atimes/China_Business/JL05Cb03.html

After committing over $7 trillion into the finance sector, the market continued to fail and the economy heading downward. If just $2 trillion of the $7 trillion the government has so far committed for the financial sector were to be channeled directly to the unemployed, each worker would receive $200,000 (the equivalent of four years at average wages) to tie them over their jobless phase to kick-start the economy.

The same amount would support for one whole year 40 million middle-income families with an annual income of $50,000. If government funds were directed towards people rather than institutions, consumer demand will revive immediately and companies will sell again to make profits. The recession will end within 18 months.

But alas, the measures taken by the US government thus far were all designed to save the financial system and its institutions from the penalty of excessive risk rather than to help the economy and its people from the pains of recession. The net result of this top-down approach will be to punish the economy with a lost decade while feeding the cancer of a dysfunction financial system held together by unsustainable debt.

Still, the market-oriented US leader felt the need to adhere ideologically only to a top-down solution. The priority must be to save the dysfunctional financial system and its wayward institutions, while the public must wait for the presumed trickling down benefits, if any. A decade-long depression will be the result.

The leaders of the G20 have a collective responsibility to face the reality of the crisis to save the world economy from total collapse instead of meekly following misguided US rescue measures of adding more liquidity to a crisis created by excess liquidity.

[Arraya]

http://www.atimes.com/atimes/China_Business/JL05Cb03.html

After committing over $7 trillion into the finance sector, the market continued to fail and the economy heading downward. If just $2 trillion of the $7 trillion the government has so far committed for the financial sector were to be channeled directly to the unemployed, each worker would receive $200,000 (the equivalent of four years at average wages) to tie them over their jobless phase to kick-start the economy.

The same amount would support for one whole year 40 million middle-income families with an annual income of $50,000. If government funds were directed towards people rather than institutions, consumer demand will revive immediately and companies will sell again to make profits. The recession will end within 18 months.

But alas, the measures taken by the US government thus far were all designed to save the financial system and its institutions from the penalty of excessive risk rather than to help the economy and its people from the pains of recession. The net result of this top-down approach will be to punish the economy with a lost decade while feeding the cancer of a dysfunction financial system held together by unsustainable debt.

Still, the market-oriented US leader felt the need to adhere ideologically only to a top-down solution. The priority must be to save the dysfunctional financial system and its wayward institutions, while the public must wait for the presumed trickling down benefits, if any. A decade-long depression will be the result.

The leaders of the G20 have a collective responsibility to face the reality of the crisis to save the world economy from total collapse instead of meekly following misguided US rescue measures of adding more liquidity to a crisis created by excess liquidity.

[Arraya]

http://www.atimes.com/atimes/China_Business/JL05Cb03.html

After committing over $7 trillion into the finance sector, the market continued to fail and the economy heading downward. If just $2 trillion of the $7 trillion the government has so far committed for the financial sector were to be channeled directly to the unemployed, each worker would receive $200,000 (the equivalent of four years at average wages) to tie them over their jobless phase to kick-start the economy.

The same amount would support for one whole year 40 million middle-income families with an annual income of $50,000. If government funds were directed towards people rather than institutions, consumer demand will revive immediately and companies will sell again to make profits. The recession will end within 18 months.

But alas, the measures taken by the US government thus far were all designed to save the financial system and its institutions from the penalty of excessive risk rather than to help the economy and its people from the pains of recession. The net result of this top-down approach will be to punish the economy with a lost decade while feeding the cancer of a dysfunction financial system held together by unsustainable debt.

Still, the market-oriented US leader felt the need to adhere ideologically only to a top-down solution. The priority must be to save the dysfunctional financial system and its wayward institutions, while the public must wait for the presumed trickling down benefits, if any. A decade-long depression will be the result.

The leaders of the G20 have a collective responsibility to face the reality of the crisis to save the world economy from total collapse instead of meekly following misguided US rescue measures of adding more liquidity to a crisis created by excess liquidity.

[CA renter]

arraya,

That was one of the best articles I’ve seen regarding our current situation, and how the government is on the wrong track…that their efforts will actually worsen the depression rather than protect us from one.

It’s not about GDP or making more credit available. The problem is that people at the bottom of the food chain have been starved. In a debt-based system, the movement of money is always from the bottom-up. At some point, the bottom not only has nothing left, but a major deficit which they cannot possibly pay off. At that point, the entire system freezes, and the only way out is for the money to be redistributed from the top-down, so the cycle can start over again.

We can either redistribute from the top-down, or we can print money and give it to the bottom half by creating jobs (govt infrastructure, energy and healthcare innovations, etc.). Either way, the money needs to go to the bottom, not the top.

[CA renter]

arraya,

That was one of the best articles I’ve seen regarding our current situation, and how the government is on the wrong track…that their efforts will actually worsen the depression rather than protect us from one.

It’s not about GDP or making more credit available. The problem is that people at the bottom of the food chain have been starved. In a debt-based system, the movement of money is always from the bottom-up. At some point, the bottom not only has nothing left, but a major deficit which they cannot possibly pay off. At that point, the entire system freezes, and the only way out is for the money to be redistributed from the top-down, so the cycle can start over again.

We can either redistribute from the top-down, or we can print money and give it to the bottom half by creating jobs (govt infrastructure, energy and healthcare innovations, etc.). Either way, the money needs to go to the bottom, not the top.

[CA renter]

arraya,

That was one of the best articles I’ve seen regarding our current situation, and how the government is on the wrong track…that their efforts will actually worsen the depression rather than protect us from one.

It’s not about GDP or making more credit available. The problem is that people at the bottom of the food chain have been starved. In a debt-based system, the movement of money is always from the bottom-up. At some point, the bottom not only has nothing left, but a major deficit which they cannot possibly pay off. At that point, the entire system freezes, and the only way out is for the money to be redistributed from the top-down, so the cycle can start over again.

We can either redistribute from the top-down, or we can print money and give it to the bottom half by creating jobs (govt infrastructure, energy and healthcare innovations, etc.). Either way, the money needs to go to the bottom, not the top.

[CA renter]

arraya,

That was one of the best articles I’ve seen regarding our current situation, and how the government is on the wrong track…that their efforts will actually worsen the depression rather than protect us from one.

It’s not about GDP or making more credit available. The problem is that people at the bottom of the food chain have been starved. In a debt-based system, the movement of money is always from the bottom-up. At some point, the bottom not only has nothing left, but a major deficit which they cannot possibly pay off. At that point, the entire system freezes, and the only way out is for the money to be redistributed from the top-down, so the cycle can start over again.

We can either redistribute from the top-down, or we can print money and give it to the bottom half by creating jobs (govt infrastructure, energy and healthcare innovations, etc.). Either way, the money needs to go to the bottom, not the top.

[CA renter]

arraya,

That was one of the best articles I’ve seen regarding our current situation, and how the government is on the wrong track…that their efforts will actually worsen the depression rather than protect us from one.

It’s not about GDP or making more credit available. The problem is that people at the bottom of the food chain have been starved. In a debt-based system, the movement of money is always from the bottom-up. At some point, the bottom not only has nothing left, but a major deficit which they cannot possibly pay off. At that point, the entire system freezes, and the only way out is for the money to be redistributed from the top-down, so the cycle can start over again.

We can either redistribute from the top-down, or we can print money and give it to the bottom half by creating jobs (govt infrastructure, energy and healthcare innovations, etc.). Either way, the money needs to go to the bottom, not the top.

[davelj]

[quote=arraya]If you look at the capacity for the govt. to borrow and stimulate (go back to WW II and you’ll see federal debt to GDP at 122% – right now we’re at about 70%)

Attempts to reframe the argument in terms of only federal debt are red herrings. First because how we measure “GDP” has changed so dramatically over the years that it’s not really possible to accurately compare federal debt over the decades. Second because federal debt is only 20% of the debt pie.

Ultimately whether the debt is held by a town, a state, a corporation or the federal government it is the labor of individual people that pays it off.

[/quote]

I framed in terms of federal debt because the govt. has the authority to tax in future years to bring that debt down.

Total non-financial debt-to-GDP is around 340%, which is almost an all-time high (only because it’s fallen a little in the last few months). That will be worked down to around 250% over the next 10 years by a combination of debt being written off and paid down, and GDP growing very modestly (probably averaging half the rate of the last decade). 250% is high, but sustainable.

Look, I’m quite bearish. But data suggests that avoiding a depression is easily achievable with the right policy response. We’ll see if the Officialdom is capable of maneuvering properly.

[davelj]

[quote=arraya]If you look at the capacity for the govt. to borrow and stimulate (go back to WW II and you’ll see federal debt to GDP at 122% – right now we’re at about 70%)

Attempts to reframe the argument in terms of only federal debt are red herrings. First because how we measure “GDP” has changed so dramatically over the years that it’s not really possible to accurately compare federal debt over the decades. Second because federal debt is only 20% of the debt pie.

Ultimately whether the debt is held by a town, a state, a corporation or the federal government it is the labor of individual people that pays it off.

[/quote]

I framed in terms of federal debt because the govt. has the authority to tax in future years to bring that debt down.

Total non-financial debt-to-GDP is around 340%, which is almost an all-time high (only because it’s fallen a little in the last few months). That will be worked down to around 250% over the next 10 years by a combination of debt being written off and paid down, and GDP growing very modestly (probably averaging half the rate of the last decade). 250% is high, but sustainable.

Look, I’m quite bearish. But data suggests that avoiding a depression is easily achievable with the right policy response. We’ll see if the Officialdom is capable of maneuvering properly.

[davelj]

[quote=arraya]If you look at the capacity for the govt. to borrow and stimulate (go back to WW II and you’ll see federal debt to GDP at 122% – right now we’re at about 70%)

Attempts to reframe the argument in terms of only federal debt are red herrings. First because how we measure “GDP” has changed so dramatically over the years that it’s not really possible to accurately compare federal debt over the decades. Second because federal debt is only 20% of the debt pie.

Ultimately whether the debt is held by a town, a state, a corporation or the federal government it is the labor of individual people that pays it off.

[/quote]

I framed in terms of federal debt because the govt. has the authority to tax in future years to bring that debt down.

Total non-financial debt-to-GDP is around 340%, which is almost an all-time high (only because it’s fallen a little in the last few months). That will be worked down to around 250% over the next 10 years by a combination of debt being written off and paid down, and GDP growing very modestly (probably averaging half the rate of the last decade). 250% is high, but sustainable.

Look, I’m quite bearish. But data suggests that avoiding a depression is easily achievable with the right policy response. We’ll see if the Officialdom is capable of maneuvering properly.

[davelj]

[quote=arraya]If you look at the capacity for the govt. to borrow and stimulate (go back to WW II and you’ll see federal debt to GDP at 122% – right now we’re at about 70%)

Attempts to reframe the argument in terms of only federal debt are red herrings. First because how we measure “GDP” has changed so dramatically over the years that it’s not really possible to accurately compare federal debt over the decades. Second because federal debt is only 20% of the debt pie.

Ultimately whether the debt is held by a town, a state, a corporation or the federal government it is the labor of individual people that pays it off.

[/quote]

I framed in terms of federal debt because the govt. has the authority to tax in future years to bring that debt down.

Total non-financial debt-to-GDP is around 340%, which is almost an all-time high (only because it’s fallen a little in the last few months). That will be worked down to around 250% over the next 10 years by a combination of debt being written off and paid down, and GDP growing very modestly (probably averaging half the rate of the last decade). 250% is high, but sustainable.

Look, I’m quite bearish. But data suggests that avoiding a depression is easily achievable with the right policy response. We’ll see if the Officialdom is capable of maneuvering properly.

[Author]

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