Greenspan: Flaw in Free Market Idealogy

[UtahGetMe**]

Originally Posted by NoFreeSpeech

This is the most basic criticism against capitalism and free market. Free markets are not long-term viable and will always have crashes and bubbles.

Even hard core capitalists admit as much, they just feel its worth it.

[rail_gun_01]

Originally Posted by SmileyPSU

That this is the most basic criticism of capitalism is a testament to how strong a philosophy it is.

what does a "crash" or "bubble" entail ?

[darthdad]

Originally Posted by Dizzle

The Fed Govt. has a flaw, if Acorn wasnt pressuring banks to give sub-prime loans, then we wouldnt have a mortage crisis with 86% of forclosures from minoritys.

govt. regulation creates flaws

You just have to love this propoganda that ACORN and liberals forced lending institutions to do their bidding thereby exacerbating the sub-prime loan crisis. Yep, pity the poor banks who are powerless in the face of pressure and would have us all believe that they just NEVER would have made unsound business decisions if it weren't for others.

Get real!

[Dizzle]

Originally Posted by NoFreeSpeech

You always have to drag race into things, you piece of shit racist scumbag.

At least your hero Pat Buchanan is subtle about his extreme racist views.

NoFreeSpeech, does the fairness doctrine require you to post here?

The govt. got involve in the mortage business and created even more of a burden on the taxpayers, whats so hard to understand? Political Correctness does not approve of people like Pat who actually think for themselves.

Karl Rove to Blame for Meltdown, 86% of Foreclosures from Minority Borrowers

[Dizzle]

Originally Posted by darthdad

You just have to love this propoganda that ACORN and liberals forced lending institutions to do their bidding thereby exacerbating the sub-prime loan crisis. Yep, pity the poor banks who are powerless in the face of pressure and would have us all believe that they just NEVER would have made unsound business decisions if it weren't for others.

Get real!

Why else would banks defy common logic and make high risk loans? They were promised a bailout.
Liberal, Dick Morris seems to disagree with you
THE NUTS AT ACORN COULD CAUSE OBAMA’S FALL at DickMorris.com

[darthdad]

Originally Posted by Dizzle

Why else would banks defy common logic and make high risk loans? They were promised a bailout.
Liberal, Dick Morris seems to disagree with you
THE NUTS AT ACORN COULD CAUSE OBAMA’S FALL at DickMorris.com

They make high risk loans because of the potential for higher profits. This happened in the 80's. Banks were throwing money at people seeking loans. The fact that someone might not need a particularly high amount wasn't an impediment to them offering it.

Common logic is defied rather often, especially where money is concerned. Its disappointing but it happens.

[Reako]

Originally Posted by SmileyPSU

The agency problem is not a new concept, so I have no option but to feel that Greenspan is being dishonest when he says the idea that certain managers and employees would put their own financial wellbeing ahead of the wellbeing of the company is unimaginable.

people have been putting their short term self interest ahead of society, their family, their company etc since the dawn of time. Only a moron (greenspan) would not have figured this out at his advanced stage in life.

[Lee978]

Originally Posted by WandyWiolentFan

Alan Greenspan, the former Federal Reserve chairman once considered the infallible maestro of the financial system, admitted on Thursday that he "made a mistake" in trusting that free markets could regulate themselves without government oversight.

The sad thing about all of this is that Greenspan supposedly is a close follower of Ayn Rand and so he actually knows what real free markets are and he actually believes in a gold standard. Knowing all that he still lies to everyone and blames this whole mess on "free markets" when he knows that isn't true. Never in our history has the state totally been separated from the economy and Greenspan did nothing to change that so people thinking other wise have been fooled.

Alan Greenspan: “I made a mistake in presuming that the self-interest of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms."

Of course this is what happens when you intervene in the market and artificially set interest rates lower then the going rate of profit. You end up fooling a lot of people. This eventually leads a majority of businessmen (who up this point have been making a killing for their shareholders and firms) to make bad decisions all at once which causes the business cycle and which in an other wise true free market wouldn't happen.

Mr. Greenspan : “Yes, I’ve found a flaw. I don’t know how significant or permanent it is. But I’ve been very distressed by that fact.”

"A flaw in the model that I perceived is the critical functioning structure that defines how the world works.”


"That is precisely the reason I was shocked, because I'd been going for 40 years or more with very considerable evidence that it was working exceptionally well."

YouTube - Greenspan Denies Blame for Crisis, Admits 'flaw'
Greenspan concedes error on regulation - International Herald Tribune
http://www.nytimes.com/2008/10/24/bu...ulation&st=cse

Its to bad the model he implemented isn't the same model he blames for causing our economic problems. This guys so full of shit, Ayn Rand would role over in her grave if she new this guy was an admirer of her economic philosophies.

[Lee978]

Originally Posted by Reako

Geee wizz beaver, you mean the human factor fucks up that nice little system we created because people are greeder little fuckers so lustful for money that they dont stop to think about long term viability? Whoda thunk it. Oh ya, I been saying it for atleast a decade. Fuck alan greenspan, hes as part of the problem as anyone.

Do you even know what causes a bubble? If so can you explain it to me?

[Lee978]

Originally Posted by NoFreeSpeech

This is the most basic criticism against capitalism and free market. Free markets are not long-term viable and will always have crashes and bubbles.

Originally Posted by UtahGetMe2

Do you even know what a free market is?

Do you guys even know what free markets are?