Yogidad

The Recovery Was Too Expensive

Just keep buying gold I guess Dude. Many of your arguments have been addressed elsewhere and you make no response to those important points. What are your present positions? 100 percent in tea bags probably. It's always easier to point out negative possibilities.

Blowing Bubbles (Part I)

It is universally agreed that this is unchartered territory. So drawing conclusions from past events requires more thought than is presented here. I find it flawed whenever someone merely points to an ideaological standpoint as their basis for a conclusion - "outdated . . . Keynesian" I can't say what is meant by that. Everyone already knows that it's going to be touch and go (even if they don't admit it). So what are you offering here?

In Madoff We Trust

Everyone knows the pyramid aspects of the social security system. It's taught in grade school and the commenters that say they never thought of it before - simply cannot be believed. The fact is that one way or the other the government (and therefore the taxpayers) are responsible for the welfare of the aged if they cannot pay for themselves. Social security is simply a way of creating some indivdual incentive and some individual control and autonomy in later-life - where possible. Everyone knows that the terms must be adjusted in the near future.
The only interesting part of the article is the very short discussion relating to of the stock market's similarities to a Ponzi scheme. Yes valuation bubbles are very close to a Ponzi scheme. And the lax enforcement of transparency and reporting regulations when the market is on a constant rise is fixable if we showed the will-power while the bubble is making everyone heady.

Great Depression Not Imminent, But Inevitable

The author is saying that valuations of equities and other investments (this would include real estate) are heavily inflated because of the false notion that derivatives hedged extremely speculative bets. As this notion fades, valuations will continue to plummet and less money will be thrown into markets as a more objective notion of risk takes hold. Therefore, there is still a very long way down on this basis alone. (Obviously there are a number of other reasons to predict valuation losses in the future.) The author is noting both a dramatic difference from the Great depression and how it could lead to the same place. I think this answers your question.


On Dec 17 07:49 AM Maya_ wrote:

> Silly article. One has to acknowledge that derivatives have serious
> destructive potential. But policy response is likely to contain the
> damage. As far as whether "no insurance" will cause a great depression;
> I wonder why the great depression ever got over; after all derivatives
> in its present day form are a very recent phenomenon.