Quote:
Originally Posted by Vendzilla
Gas prices are still up
I understand that, but heavier shipping costs don't help
Until someone realized they needed to pay for oil spill
It's just one more thing that I disagree with, the reform that was shoved thru with partisan support, and I doubt it will work
And I really doubt the politicians that did the reform understand it either
I made a general statement, you went on and on
Take a look at history, Reagan had the same problem and handled it differently, and it worked
inflation from 12.5 to 4.4
unemployment from a high of 10.8% to 5%
and had a growth of gdp of 3.85% on average a year
So don't tell me it can't be done
I don't give a rats ass about one side over the other, I just don't like when the government takes something over.
I have a common sense question for you, when the government has less to spend, because of people out of work, why would the government think its a good time to increase spending by adding more entitlements?
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Seriously, I find it hard to believe you are having a hard time understanding the energy price issue.
Oil went to $140 in 2008. From that high it collapsed to under $40 within about 8 months. It didn't fall that hard because GWB had success with energy policy or because of the Oil spill (which didn't occur until 2010). Oil is currently trading at 101.66 basis the June contract. NOW.... Read carefully... It fell because the financial system was about to collapse and
deflation was rearing its' head.
It's also hard to believe that you don't understand what would have happened if Bush and Obama, et al (and the FED) did not rush to backstop the system once it started imploding. Regardless of why or who's fault it was or what the antecedent causes that led up to all this were.... What do YOU think was going to happen if nothing was done?
Reagan did not have the same problem. Not only was it the complete opposite economic situation, it wasn't anywhere close to as large a problem / danger. Again, you just seem to have no grasp of economics or the direness of the situation. Your appeal to "look at history" here illustrates that you are arguing from ignorance.
There are a lot of people who argue against Keynesian economics, but I think you have to separate the model from how it's been applied. So in simple terms.... In theory, you are supposed to save when times are good and spend when times are bad. Fiscal (spending) and monetary policies would be used to smooth out what are normal cycles in economic conditions. The problem is that politicians (Republicans or Democrats) have been piss poor at the "saving when times are good" part. And, one could argue that the FED has been too aggressive with monetary policy, although they probably were in reality simply living up to their mandate. That's another debate.
The answer to your question is that if they don't "re-prime the pump", the economy is more likely to slip back into DEFLATION (the problem being faced in 2008 as opposed to 1980) and --
here's the important part -- this would be magnitudes of orders worse than what we have now. IOW, the Great Depression on steroids.