Credit cards are being paid back in record numbers but this is the root cause of the current depression/recession.
How can we fix this? You think in hard times that Wall Street will allow a company to hire more expensive American workers when no one is buying? Everyone would have to do this at once and its far to tempting to keep your factories in China when your competitors move back to the US.
The only thing that can fix this is protectionism or let the US root for a few decades. Japan still have not fully recovered from its 1990 recession and America already had its lost decade (9% less jobs and flat GDP).
If the concentration of power was more distributed housing, insurance, gas, and other expenses will go down in price and more of the middle and lower classes will have purchasing power again. It seems outsourcing caused the problem and increased it. As long as my boss threatens to fire me and there are no jobs then I will be willing to work for less and under worse circumstances.
How can we have cheap labor when a basic apartment is $1500 a month? My neighbor who makes more money pays $700 for the same condo as a mortage as he bought it 10 years ago.How is that fair?
Why did the price double in 10 years? Greedy investors are jerking the price and this is the problem. These same greedy rich investors are the ones who want everyone to work for cheap but at the same time get insane returns on sales from the same population also want those willing to work for $2/hr and pay $300,000 for a house to line their pockets. Nah Americans will eventually work for cheaper and everything will work out again... bla bla
Its not going to happen and its not sustainable.
Like the other poster said. Both China and US would have to have the GDP of Mexico to compete and be perfectly balanced but we still would have expensive housing, insurance, and other problems. The argument of well, the cost of living will go down when it corrects is bogus too as many of the few elite here have the power to keep housing, insurance, food, and other expenses very high. Supply and demand does not matter as the purchasing power is in hands of an increasingly wealthy elite and wall street. If the prices go down then we have a meltdown again. Its all a big mess.
England did the same thing we did by outsourcing and basing GDP off of financial services during the 1873 depression and it took up to WW2 to recover. Infact it still has not fully recovered.
I am just afraid of what will happen if America becomes insolvent to the Chinese. Yikes
If you were ever accused of a crime but later found innocent you can never be a teacher or work in alot of companies and this is true even if you were prosecuted but later overturned.
Statistical wise you maybe more guilty so why take the risk in hiring you?
FreeBSD 4.x was hot back in the old days of 2003ish. After pulling my hair out with Gentoo FreeBSD was well integrated and stable.
I know there is experimental 5 year old patches for java 1.3x which I successfully compiled which looked like a bootstrap hack with an emulated jvm just to compile it. FreeBSD 5.x was just terrible and i kept using 4.x until 4.12 before switching back to Windows. I hope it got better as not even my simple usb keyboard that was supported with FBSD 3.,x and 4.x would not work with 5.x and 6.x
An independent got 20% of the independent vote in New Jersey. This shows we are not alone on this.
Too bad the reform party of Perot and Ventura was hijacked and destroyed by Pat Buchannon. Republicans and democrats are at all time lows. Sure the republicans are probably going to win the next elections as many conservatives are upset at Obama and most democrats who voted for him are disillusioned and will stay home. So basically we will have both houses trying to relive Bush and vote no on anything that helps people out with the exception of corporate interests.
Yes the US has one of the most corrupt governments in the world and there are better democracies. The problem is in these countries its easier to form another party. In the US we just tip the vote to our opponent who most disagrees with our views if we do not select the D or R.
We need a new leader and one who will create followers who will scare the daylights out of both parties.
This is 2009 and it is nearly impossible to find a job without a degree and 5+ years of experience no matter how entry level. Times have changed here in the lower ladders of employment with the number of jobs down over 10% since 1999 in addition a 12% increase in workforce population. This recession was coming with an illusion of GDP caused by debt and high stock prices which hid the problem.
Things might change when the recession changes but for now HR can simply demand a degree and you have to have it or your resume will be automatically sent to the trash folder in outlook.
You need both and maybe you can work entry level for several years to you become middle management if your lucky. Perhaps I sound bitter but thats just from my own experience.
In my experience the workplace is where you learn the most practical things. When I went to school we had an internal debate in one of our classes on whether people or technical skills are more important on the job as a manager.
People skills won hands down because technical skills can be learned on the job. People skills, attitude, and experience is what is required to get the job done.
I just got my bachelors degree in Business last summer and so far it has not helped me in I.T. It did land me a job as a substitute teacher which pays more than minimium wage which is great in this economy but it is not a guaranteed ticket to a middle class lifestyle and career like some here say it is. I have a feeling if I changed my major to computer science it would not help as that degree is not as versatile in the private sector and in a down economy India looks more attractive.
Just because someone knows calculus and can write a few lines of code in Java does not mean that individual knows practical processes and working in very large coding projects with customers and real timelines.
If I had more experience and did not cut back on work to finish my education I probably would be in my field now. Its damned if you do and damned if you don't. Employers like both experience and a degree because it reduces liability when a bad employee is let go. Companies like FedEX require a computer science degree and experience as a cover your ass policy in case of wrongful termination lawsuits.
"So now IT is not a cost center, it's a return on investment to the owners. Much like the accountants themselves."
LOL
I like that. Accountants do not bring in revenue and only salespeople and workers bring it in so lets cut costs and outsource and can all the accountants. You would never see this happen but this seems like a strange similiarity.
The problem is reducing costs is difficult to calculate but cutting budgets can easily be shown to increase productivity in a spreadsheet (economic productivity). An accountant can make a decent raise in his salary by screwing the I.T. departments as instant savings can be made. After all I.T. does not make revenue directly.
We have a culture of screwing other employees whenever times get tough and this is what I see happen. Where my wife worked they laid off hundreds of employees and every department got axed but the HR who actually hired more people. They laid people off to justify why they were more important and did the firings in secret without managerial approval. If a manager complains then he or she might be next. Accountants do the same thing and its themselves they care most about.
Children test your patience and teaching is a difficult profession. Its like sales in that you have it or you do not. You need to motivate students who hate school to want to learn, make it fun, control classroom, and of course improve scores on No Child Left Behind tests.
I do not like being a prick and I have to do that alot when I am a sub to scare students into shape otherwise I will be run over.
If you work at places like mental wards as a teacher or special schools you can get a trained professional in the classroom who can legally yank kids so you can do your job. I worked at a hospital where the school district had a few classrooms and I tried not to laugh as a student tried to attack me with a pencil and three people came in, grabbed him, and gave him a shot right there. Then he acted like a different person and it was reminiscent of the movies.
If you have a passion to make a difference in someones life, have patience for annoying behavior, and have good people skills you should go for it. A credential takes 2 years and you may have to work for free for a whole semester or year as an intern before you can actually get paid.:-( That depends on your state.
I got my degree. Didn't help as I am substitute teaching until something pops up. I would wait until the recession leaves first as anyone who changes careers falls in the non-experienced crowd.
You can thank Clinton and Bush for making it so easy and profitable to outsource American labor. When consumer spending owns 70% of the economy because there is no manufacturing or business spending left in the U.S. it is a huge problem.
In past recessions business spending brings the economy up and then consumers follow. Now it does not make a difference as invested money just goes to China and India and not back to us. Consumers are working for less and working more hours cut back on spending until things improve.
We did not allow this. THe corrupt lobbiests and politicians did. We need to fight back and form a third party or get involved with other workers like auto and factory workers who can't compete and end free trade. Only then will we get our salaries and our jobs back. Yes in a recession like this one I am willing to cut throat and kiss b*tt not to go homeless and its hopeless trying to have us all agree to stand up when so much labor is available.
You can't justify ROI with intangible assets. Thats accounting 101. For the non business majors reading this it means if something is not physically there with a recept and a precise unit output it therefore can't have a cost/benefit anaylsis.
Marketing people use intangible assets like brand image and advertising and accountants are cool with it and understand but no not I.T. its a cost!
Your accountants need to know this and use cause and effect relationships in determining the cost of failure or a benefit and not look at outputed units of revenue. Its just not going to happen and end up costing more.
I agree with what you are saying with salary. I get upset reading about talent bonuses for the wonderful jobs of BofA and AIG executives and just because someone thinks they have a nice office that they are now important. If I make a company lose only a few thousand dollars my butt is out the door. If its a few billion they get a bonus because they ahve a nice office and their employers want to kiss up so they can become like them some day. Founders need these but most good CEO's make less money than bad ones. I think slashdot ran a story on this.
It just comes to show that you need to hire passionate people about who they work for and what they do and not their egos or wallets. Its pretty obvious who the latter is loyal to at the end of the day.
This all has to do with supply and demand economics and not importance. Would would happen if all the computers went down at any modern company? You would not stay in business for long. Also business processes engineering is big now and I.T. is part of the solution and not a cost center.
If someone in India can do your job for $11/hr then why should you earn respect? Managers and accountants are going to be axed next as they are seen as deadweight when someone from a 3rd world country can do it for alot cheaper. Why not move the whole company to China?
If free trade did not exist you would see programmers still making 70k a year and being treated better.
In 10 years from now the people who are out partying and leaving work early will be working for half price until 7 or 8 at night as well as competition increases. Sales is the only job left here but no one will be buying things as our economy deflates.
... and as long as the manager fires the subordinate then he gets off scott free.
A good HR manager looks for patterns like this and sees through the blame game with employee retention. Unfortunately in a recession this is normal and you can find very good and experienced labor now willing to work for dirt cheap.
How are the values of the assets counted? Did it become a 30-1 ratio after the value of homes crashed? The ratio would be lower during the height. Also the banks considered these assets very liquid as they could flip them quick and use a credit swap to avoid any risk. If a market was about to crash they could cash in quick.... which in return the opposite happened at the very last second with it froze and banks shunned each other.
Its all one big accounting game as far as I can see. Still I am surprised that not one large bank played it safe. Seriously what were they thinking... bet the CEO's didn't care and just wanted their bonuses before a crash happened.
THe state of California is investigating claims that health insurers are denying 40% of claims!
Just because you have insurance does not mean you still do not have to sell your house. Americans in general oppose government run... well anything... including health care but this is changing due to the greedy and abusive insurer practices.
The parent is also quite correct in stating that the reason health care costs are high is because people/insurers have been willing to pay for it. Why would I want to sell a pill for $10 if I could sell it for $100 and someone would die without it? How much is your life worth?
I think universal health coverage mixed with a trust bust for the greedy drug companies and free college loans for medical students might be the answer.
Something has to give as the cost of living with this and housing keep going up whether they are counted in inflation or not and most people are becoming quite poorer.
The problem is the banks do not have to take risks. Thats what credit swaps and flipping are for.
If the bank can sell the $250k home worth $125 for $275 30 days later... thats a $25,000 profit!
Until the banks have to keep their own darn assets then they will think like you and I with risks.
FDR (socialists as he was) did the right thing with the glass ceiling laws. It should be illegal to package assets together and flip properties to financial firms. What Greenspan and Clinton did needs to be undone. Problem is the banks are lobbying Obama to just do something dumb like have our great banks keep 5% of the home rather than 100% pre 1999.
I would not be surprised if the banks did this on purpose.
I learned in finance that not paying suppliers is a great idea (nice ethics) because a delay means you can invest an extra million or two, then pay and keep the interest. So if 1 million is taken a month to be repaid that means the bank has an extra million to invest in more worthless housing which they would flip and keep the interest after fixing the 1 million when its paid back.
They got their bonuses, free tax money, and bought stocks in march which went up 300% in value and made a fortune. Insider selling of stocks from CEO's and financial firms this week was at an all time high. Hmmm...I think they know something we do not and another bubble is upon us now.
The banks would do it all over again if they could which is why they oppose regulation. After all they could make more bonuses and get even more tax money and buy and sell stocks when the next recession/depression hits.
I was hoping and still hope that Bof A and Chase fail. They are scum (usually do not use such adjectives) and I would like to see smaller banks replace them for stability. Unfortunately lines of credit for big business depends on these banks which is why they were bailed out.
I knew better myself not to do an arm and saw this as unhealthy a few years ago and figured something would eventually give. However, I am adversely effected which is not right either.
Crop production subsidization and the nature of changing fuel costs are why its not counted in. In addition, if something like a late freeze or a hailstorm ruins a large percentage of crops you can bet economists will be going into a headspin on inflation when in reality it is no big deal as you much as it looks like on paper. But that too is a problem long term. Gas was $1.75 American in 1999 and its well over $3.00 today.
I agree its outrageous with these housing prices and it makes me quite angry... as I do not own a home and now will have to sacrifice my kids college if I decide to join what everyone else got from the bubble... free money. My aunt is moaning how she can only afford a $450,000 home because her husband makes a mere $60,000, but has free equity due to 2 other homes so there is no money down and she has rent money to subsidize 60% of her mortgage. Meanwhile we make the same and have to move in to her basement. I wish the prices would drop more and the latest housing data shows this. But if you and I owned homes bought pre-2004 I bet our opinions would be quite different.:-)
Still the recession is going to be here for some time as many who did not make the home list pre 2004 or had their insurance cut will be poor and not consuming anymore.
The problem is lines of credit are lifelines for businesses. Especially small business which makes up the vast majority of jobs surprisingly. If no lines of credit are available because banks are failing from their own actions then your boss fires you to cover the loss as he can't use the bank to pay your salary.
There is a debate between economists on whether inflation should just include the price of products excluding food and energy or should it include housing and health insurance. Both housing and insurance have trippled since the late 1990's. Sure on paper it looks like you make the same but a $175,000 home in 1999 costs $350,000 even during the recession. Suddenly $55,000 a year is not worth jack in most metropolitan areas even if prices do not necessarily show it.
If you health care costs were put in the inflation equation with housing we would see a totally different side of economics that economists should have prevented if they only knew.
The problem is repacking means mixed with 700 - 2000 page contracts for each instrument added to each package and no one knows whats in each package. This is what caused the recession and its fear based on a total lack of transparency. Banks don't really know and neither do investors who owns what.
The practice in my opinion needs to end. If you want a mixed portfolio you need to know what you are invested in and not have the banks make it secret.
I think cell phones and AJAX are actually making this comeback of a centralized system. I mean I am using this laptop I am typing this on as a terminal to slashdot's server.
If there is hope its with the new mobile touch screen phone and netbook operating systems. Windows desktops are turning into the mini/mainframes of old.
Slashdot Mirror
Credit cards are being paid back in record numbers but this is the root cause of the current depression/recession.
How can we fix this? You think in hard times that Wall Street will allow a company to hire more expensive American workers when no one is buying? Everyone would have to do this at once and its far to tempting to keep your factories in China when your competitors move back to the US.
The only thing that can fix this is protectionism or let the US root for a few decades. Japan still have not fully recovered from its 1990 recession and America already had its lost decade (9% less jobs and flat GDP).
If the concentration of power was more distributed housing, insurance, gas, and other expenses will go down in price and more of the middle and lower classes will have purchasing power again. It seems outsourcing caused the problem and increased it. As long as my boss threatens to fire me and there are no jobs then I will be willing to work for less and under worse circumstances.
How can we have cheap labor when a basic apartment is $1500 a month? My neighbor who makes more money pays $700 for the same condo as a mortage as he bought it 10 years ago.How is that fair?
Why did the price double in 10 years? Greedy investors are jerking the price and this is the problem. These same greedy rich investors are the ones who want everyone to work for cheap but at the same time get insane returns on sales from the same population also want those willing to work for $2/hr and pay $300,000 for a house to line their pockets. Nah Americans will eventually work for cheaper and everything will work out again ... bla bla
Its not going to happen and its not sustainable.
Like the other poster said. Both China and US would have to have the GDP of Mexico to compete and be perfectly balanced but we still would have expensive housing, insurance, and other problems. The argument of well, the cost of living will go down when it corrects is bogus too as many of the few elite here have the power to keep housing, insurance, food, and other expenses very high. Supply and demand does not matter as the purchasing power is in hands of an increasingly wealthy elite and wall street. If the prices go down then we have a meltdown again. Its all a big mess.
England did the same thing we did by outsourcing and basing GDP off of financial services during the 1873 depression and it took up to WW2 to recover. Infact it still has not fully recovered.
I am just afraid of what will happen if America becomes insolvent to the Chinese. Yikes
Try applying for a job?
If you were ever accused of a crime but later found innocent you can never be a teacher or work in alot of companies and this is true even if you were prosecuted but later overturned.
Statistical wise you maybe more guilty so why take the risk in hiring you?
FreeBSD 4.x was hot back in the old days of 2003ish. After pulling my hair out with Gentoo FreeBSD was well integrated and stable.
I know there is experimental 5 year old patches for java 1.3x which I successfully compiled which looked like a bootstrap hack with an emulated jvm just to compile it. FreeBSD 5.x was just terrible and i kept using 4.x until 4.12 before switching back to Windows. I hope it got better as not even my simple usb keyboard that was supported with FBSD 3.,x and 4.x would not work with 5.x and 6.x
An independent got 20% of the independent vote in New Jersey. This shows we are not alone on this.
Too bad the reform party of Perot and Ventura was hijacked and destroyed by Pat Buchannon. Republicans and democrats are at all time lows. Sure the republicans are probably going to win the next elections as many conservatives are upset at Obama and most democrats who voted for him are disillusioned and will stay home. So basically we will have both houses trying to relive Bush and vote no on anything that helps people out with the exception of corporate interests.
Yes the US has one of the most corrupt governments in the world and there are better democracies. The problem is in these countries its easier to form another party. In the US we just tip the vote to our opponent who most disagrees with our views if we do not select the D or R.
We need a new leader and one who will create followers who will scare the daylights out of both parties.
When was this? 1999?
This is 2009 and it is nearly impossible to find a job without a degree and 5+ years of experience no matter how entry level. Times have changed here in the lower ladders of employment with the number of jobs down over 10% since 1999 in addition a 12% increase in workforce population. This recession was coming with an illusion of GDP caused by debt and high stock prices which hid the problem.
Things might change when the recession changes but for now HR can simply demand a degree and you have to have it or your resume will be automatically sent to the trash folder in outlook.
You need both and maybe you can work entry level for several years to you become middle management if your lucky. Perhaps I sound bitter but thats just from my own experience.
In my experience the workplace is where you learn the most practical things. When I went to school we had an internal debate in one of our classes on whether people or technical skills are more important on the job as a manager.
People skills won hands down because technical skills can be learned on the job. People skills, attitude, and experience is what is required to get the job done.
I just got my bachelors degree in Business last summer and so far it has not helped me in I.T. It did land me a job as a substitute teacher which pays more than minimium wage which is great in this economy but it is not a guaranteed ticket to a middle class lifestyle and career like some here say it is. I have a feeling if I changed my major to computer science it would not help as that degree is not as versatile in the private sector and in a down economy India looks more attractive.
Just because someone knows calculus and can write a few lines of code in Java does not mean that individual knows practical processes and working in very large coding projects with customers and real timelines.
If I had more experience and did not cut back on work to finish my education I probably would be in my field now. Its damned if you do and damned if you don't. Employers like both experience and a degree because it reduces liability when a bad employee is let go. Companies like FedEX require a computer science degree and experience as a cover your ass policy in case of wrongful termination lawsuits.
"So now IT is not a cost center, it's a return on investment to the owners. Much like the accountants themselves."
LOL
I like that. Accountants do not bring in revenue and only salespeople and workers bring it in so lets cut costs and outsource and can all the accountants. You would never see this happen but this seems like a strange similiarity.
The problem is reducing costs is difficult to calculate but cutting budgets can easily be shown to increase productivity in a spreadsheet (economic productivity). An accountant can make a decent raise in his salary by screwing the I.T. departments as instant savings can be made. After all I.T. does not make revenue directly.
We have a culture of screwing other employees whenever times get tough and this is what I see happen. Where my wife worked they laid off hundreds of employees and every department got axed but the HR who actually hired more people. They laid people off to justify why they were more important and did the firings in secret without managerial approval. If a manager complains then he or she might be next. Accountants do the same thing and its themselves they care most about.
Children test your patience and teaching is a difficult profession. Its like sales in that you have it or you do not. You need to motivate students who hate school to want to learn, make it fun, control classroom, and of course improve scores on No Child Left Behind tests.
I do not like being a prick and I have to do that alot when I am a sub to scare students into shape otherwise I will be run over.
If you work at places like mental wards as a teacher or special schools you can get a trained professional in the classroom who can legally yank kids so you can do your job. I worked at a hospital where the school district had a few classrooms and I tried not to laugh as a student tried to attack me with a pencil and three people came in, grabbed him, and gave him a shot right there. Then he acted like a different person and it was reminiscent of the movies.
If you have a passion to make a difference in someones life, have patience for annoying behavior, and have good people skills you should go for it. A credential takes 2 years and you may have to work for free for a whole semester or year as an intern before you can actually get paid. :-( That depends on your state.
I got my degree. Didn't help as I am substitute teaching until something pops up. I would wait until the recession leaves first as anyone who changes careers falls in the non-experienced crowd.
You can thank Clinton and Bush for making it so easy and profitable to outsource American labor. When consumer spending owns 70% of the economy because there is no manufacturing or business spending left in the U.S. it is a huge problem.
In past recessions business spending brings the economy up and then consumers follow. Now it does not make a difference as invested money just goes to China and India and not back to us. Consumers are working for less and working more hours cut back on spending until things improve.
We did not allow this. THe corrupt lobbiests and politicians did. We need to fight back and form a third party or get involved with other workers like auto and factory workers who can't compete and end free trade. Only then will we get our salaries and our jobs back. Yes in a recession like this one I am willing to cut throat and kiss b*tt not to go homeless and its hopeless trying to have us all agree to stand up when so much labor is available.
You can't justify ROI with intangible assets. Thats accounting 101. For the non business majors reading this it means if something is not physically there with a recept and a precise unit output it therefore can't have a cost/benefit anaylsis.
Marketing people use intangible assets like brand image and advertising and accountants are cool with it and understand but no not I.T. its a cost!
Your accountants need to know this and use cause and effect relationships in determining the cost of failure or a benefit and not look at outputed units of revenue. Its just not going to happen and end up costing more.
I agree with what you are saying with salary. I get upset reading about talent bonuses for the wonderful jobs of BofA and AIG executives and just because someone thinks they have a nice office that they are now important. If I make a company lose only a few thousand dollars my butt is out the door. If its a few billion they get a bonus because they ahve a nice office and their employers want to kiss up so they can become like them some day. Founders need these but most good CEO's make less money than bad ones. I think slashdot ran a story on this.
It just comes to show that you need to hire passionate people about who they work for and what they do and not their egos or wallets. Its pretty obvious who the latter is loyal to at the end of the day.
This all has to do with supply and demand economics and not importance. Would would happen if all the computers went down at any modern company? You would not stay in business for long. Also business processes engineering is big now and I.T. is part of the solution and not a cost center.
If someone in India can do your job for $11/hr then why should you earn respect? Managers and accountants are going to be axed next as they are seen as deadweight when someone from a 3rd world country can do it for alot cheaper. Why not move the whole company to China?
If free trade did not exist you would see programmers still making 70k a year and being treated better.
In 10 years from now the people who are out partying and leaving work early will be working for half price until 7 or 8 at night as well as competition increases. Sales is the only job left here but no one will be buying things as our economy deflates.
... and as long as the manager fires the subordinate then he gets off scott free.
A good HR manager looks for patterns like this and sees through the blame game with employee retention. Unfortunately in a recession this is normal and you can find very good and experienced labor now willing to work for dirt cheap.
How are the values of the assets counted? Did it become a 30-1 ratio after the value of homes crashed? The ratio would be lower during the height. Also the banks considered these assets very liquid as they could flip them quick and use a credit swap to avoid any risk. If a market was about to crash they could cash in quick. ... which in return the opposite happened at the very last second with it froze and banks shunned each other.
Its all one big accounting game as far as I can see. Still I am surprised that not one large bank played it safe. Seriously what were they thinking ... bet the CEO's didn't care and just wanted their bonuses before a crash happened.
THe state of California is investigating claims that health insurers are denying 40% of claims!
Just because you have insurance does not mean you still do not have to sell your house. Americans in general oppose government run ... well anything ... including health care but this is changing due to the greedy and abusive insurer practices.
The parent is also quite correct in stating that the reason health care costs are high is because people/insurers have been willing to pay for it. Why would I want to sell a pill for $10 if I could sell it for $100 and someone would die without it? How much is your life worth?
I think universal health coverage mixed with a trust bust for the greedy drug companies and free college loans for medical students might be the answer.
Something has to give as the cost of living with this and housing keep going up whether they are counted in inflation or not and most people are becoming quite poorer.
The problem is the banks do not have to take risks. Thats what credit swaps and flipping are for.
If the bank can sell the $250k home worth $125 for $275 30 days later ... thats a $25,000 profit!
Until the banks have to keep their own darn assets then they will think like you and I with risks.
FDR (socialists as he was) did the right thing with the glass ceiling laws. It should be illegal to package assets together and flip properties to financial firms. What Greenspan and Clinton did needs to be undone. Problem is the banks are lobbying Obama to just do something dumb like have our great banks keep 5% of the home rather than 100% pre 1999.
I would not be surprised if the banks did this on purpose.
I learned in finance that not paying suppliers is a great idea (nice ethics) because a delay means you can invest an extra million or two, then pay and keep the interest. So if 1 million is taken a month to be repaid that means the bank has an extra million to invest in more worthless housing which they would flip and keep the interest after fixing the 1 million when its paid back.
Sounds like they were not dumb at all.
They got their bonuses, free tax money, and bought stocks in march which went up 300% in value and made a fortune. Insider selling of stocks from CEO's and financial firms this week was at an all time high. Hmmm ...I think they know something we do not and another bubble is upon us now.
The banks would do it all over again if they could which is why they oppose regulation. After all they could make more bonuses and get even more tax money and buy and sell stocks when the next recession/depression hits.
I was hoping and still hope that Bof A and Chase fail. They are scum (usually do not use such adjectives) and I would like to see smaller banks replace them for stability. Unfortunately lines of credit for big business depends on these banks which is why they were bailed out.
I knew better myself not to do an arm and saw this as unhealthy a few years ago and figured something would eventually give. However, I am adversely effected which is not right either.
Crop production subsidization and the nature of changing fuel costs are why its not counted in. In addition, if something like a late freeze or a hailstorm ruins a large percentage of crops you can bet economists will be going into a headspin on inflation when in reality it is no big deal as you much as it looks like on paper. But that too is a problem long term. Gas was $1.75 American in 1999 and its well over $3.00 today.
I agree its outrageous with these housing prices and it makes me quite angry ... as I do not own a home and now will have to sacrifice my kids college if I decide to join what everyone else got from the bubble ... free money. My aunt is moaning how she can only afford a $450,000 home because her husband makes a mere $60,000, but has free equity due to 2 other homes so there is no money down and she has rent money to subsidize 60% of her mortgage. Meanwhile we make the same and have to move in to her basement. I wish the prices would drop more and the latest housing data shows this. But if you and I owned homes bought pre-2004 I bet our opinions would be quite different. :-)
Still the recession is going to be here for some time as many who did not make the home list pre 2004 or had their insurance cut will be poor and not consuming anymore.
The problem is lines of credit are lifelines for businesses. Especially small business which makes up the vast majority of jobs surprisingly. If no lines of credit are available because banks are failing from their own actions then your boss fires you to cover the loss as he can't use the bank to pay your salary.
There is a debate between economists on whether inflation should just include the price of products excluding food and energy or should it include housing and health insurance. Both housing and insurance have trippled since the late 1990's. Sure on paper it looks like you make the same but a $175,000 home in 1999 costs $350,000 even during the recession. Suddenly $55,000 a year is not worth jack in most metropolitan areas even if prices do not necessarily show it.
If you health care costs were put in the inflation equation with housing we would see a totally different side of economics that economists should have prevented if they only knew.
Something does need to be done.
The problem is repacking means mixed with 700 - 2000 page contracts for each instrument added to each package and no one knows whats in each package. This is what caused the recession and its fear based on a total lack of transparency. Banks don't really know and neither do investors who owns what.
The practice in my opinion needs to end. If you want a mixed portfolio you need to know what you are invested in and not have the banks make it secret.
"The old one was crap but the new one is perfect - just like every other Microsoft launch *ever*."
No you are thinking of the next version of WindowsMobile. That will be the one that will be perfect. Just wait....
I think cell phones and AJAX are actually making this comeback of a centralized system. I mean I am using this laptop I am typing this on as a terminal to slashdot's server.
If there is hope its with the new mobile touch screen phone and netbook operating systems. Windows desktops are turning into the mini/mainframes of old.