Seeking Alpha

"The solution to too much debt is not more debt," says Jim Rogers, opining on the Spanish...

"The solution to too much debt is not more debt," says Jim Rogers, opining on the Spanish bailout. "The way the system is supposed to work - when you fail you fail - competent people come in and take over assets ... it's absurd economics, absurd morality."
Comments (11)
  • The EconomicJoker
    , contributor
    Comments (961) | Send Message
     
    yep...
    11 Jun 2012, 03:01 PM Reply Like
  • Windsun33
    , contributor
    Comments (4365) | Send Message
     
    Rogers is obviously not a politician.
    11 Jun 2012, 03:03 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2826) | Send Message
     
    It worked here, sort of....
    11 Jun 2012, 03:08 PM Reply Like
  • Windsun33
    , contributor
    Comments (4365) | Send Message
     
    Except the part about figuring out a way to pay it back.
    11 Jun 2012, 03:09 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2826) | Send Message
     
    Well the banks paid it back, and the ultra low rates in the US mean no one is worried about the US paying it back. Uncle Sam has plenty of money, and its hot off the presses!
    11 Jun 2012, 03:23 PM Reply Like
  • Jason Rines (iThinkBig)
    , contributor
    Comments (2231) | Send Message
     
    Reaping rewards for success or pain for failure is the definition of Capitalism. However, it is human nature for patronage to occur. The patrons are U.S. government and their clientele is the banking system. Change happens when the poltical class actually needs the voters to win an election.

     

    A lot of pain between now and then will continue. Then a couple more years from then to finish clearing the excesses of the last decade. I believe it will be 2018 before we see some daylight, till then more stagflation.
    11 Jun 2012, 03:12 PM Reply Like
  • TWagen
    , contributor
    Comments (151) | Send Message
     
    Or later, depending on how long before we start the pain.... This is just the sun before the storm. It is the time to be the ant and prepare for winter.
    11 Jun 2012, 03:14 PM Reply Like
  • Windsun33
    , contributor
    Comments (4365) | Send Message
     
    Winter is coming....
    11 Jun 2012, 03:16 PM Reply Like
  • Playing the Ponzi
    , contributor
    Comments (141) | Send Message
     
    Politicians have no incentive to do the right (economic) thing. They have no incentive to let failed major institutions collapse when a) they may be receiving financial support from those organizations and b) the resulting fear may cause a major market sell-off. They fear the markets. They fear a replay of 2008. Unfortunately, while watching the danger on that side, they aren't paying attention of the revolutionary anger that the bailouts are stoking among the peasantry.

     

    I think the bailouts don't end in political bodies or Central Banks capitulating and letting failed entities actually fail - rather, I fear it ends with old-fashioned bloody revolution and/or major war(s).
    11 Jun 2012, 03:18 PM Reply Like
  • Topcat
    , contributor
    Comments (515) | Send Message
     
    I agree, let them fail. And, get away from the socialism of FDIC. If people put their life savings, IRAs, 401ks etc in a bank that fails, then they will know better next time. No bailouts for poor choices...let everyone take personal responsibility. Same for brokerage SPIC insurance. If your broker goes under and you lose all your investments, you will do more investigation up front about the firm the next time.
    11 Jun 2012, 05:00 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (10005) | Send Message
     
    Rogers is right about the solution but wrong about the effect.

     

    We are in a deflationary hellstorm.

     

    Cash, CDs, money market funds and precious metals will rule for the foreseeable future.
    11 Jun 2012, 06:32 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs