A new economy

[dude908]

Well as you see the result of another part of the economy crashing. Not a surprise. It happens every so often, A section of the market will grow then suddenly when their are trillions of dollars invested in that market it goes BOOM. We saw it in 2002 with the .com crash and for years people had been buying and investing in online bussiness for years then it crashed. And now it's the housing markets turn, for years it was a very very profitable bussiness and then BOOM. Now what has to happen is stabilize the economy. Forget about all of this we need to stabilize the housing market, that market is done and gone. We need to stabilize and find a new market like clean energy to turn to otherwise you will see exactly what is happening now. One thing after another will collapse. So enoguh stabilizing the housing market, fix THE MARKET and then find other solutions. I don't see this lasting another 4 years, Obama and his new economic team will fix this. But it will take a while to find and get investors to go with clean energy.

[dySWN]

I agree that we need to start focussing on a new market to curb the downward trend we're experiencing, but I'm not so sure that our current "green" energy policies are the way to go in that respect - we need something that'll need less R&D time to pick up the slack - nor do I think that the next administration will be the catalyst for the next big market. I'd like to see us loosen up our trade restrictions and cut federal spending on go-nowhere programs.

[TheMason]

What you're talking about are called economic bubbles. My personal favorite is the Tulip Mania bubble of 1637. But anyway...
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There already is a significant investment in green tech. The market is moving there on its own accord. A new company, Aptera is producing a car that is capable of 300 mph.

There is a problem in thinking Obama's economic team is going to fix this situation. The market is not bursting because of Bush's or Clinton's policies...but the economic activities of consumers and producers. We like to think (even though it is wrong) that somehow the President has power over the economy. He does not. Congress is more powerful than he in terms of domestic policy (the US president is actually the weakest chief executive in the Western/Industrialized world). Even still...congress does not have that much power over the economy and the market.

One of my co-workers thinks that healthcare reform will spell the end of Reaganomics as a viable econommic worldview. He is probably right...in the short-term. In the long-run I think Obama will spell the end of Keynesian economics. We are speeding towards the day when Social Security and Medicare will consume 100% of every dollar the US Government takes in. Healthcare will only get this day here faster. When this day comes Obamanomics will fail and take Keynes with him.

[Der-Lowe]

At 12/15/08 09:02 PM, dude908 wrote: Forget about all of this we need to stabilize the housing market, that market is done and gone. We need to stabilize and find a new market like clean energy to turn to

As the Internet lives on after the .com crash, people will continue to live in houses, so your main argument is false. I think green companies will become more widespread, but that does not mean that it will be at the expense of losing a markets; entrepreneurs do act predatorily, but not that much, some remain in the area after the great collapse, as any microeconomic analysis would tell you. Despite your shaky base, I agree with the policy implications you mentioned; maintaining an inflated housing market does not seem rational, and green energy is interesting, although I do not think it is the magical solution; I see it as a long term commitment more than a short-term patch.

At 12/16/08 03:11 PM, TheMason wrote: There is a problem in thinking Obama's economic team is going to fix this situation. The market is not bursting because of Bush's or Clinton's policies...but the economic activities of consumers and producers. We like to think (even though it is wrong) that somehow the President has power over the economy. He does not. Congress is more powerful than he in terms of domestic policy (the US president is actually the weakest chief executive in the Western/Industrialized world). Even still...congress does not have that much power over the economy and the market.

About the political system, the US political system is presidentialist and it is the one that concentrates the most power on a single person in developed nations; European countries go with a parliamentary system in which the power lies more in the Parliament. Also, few countries have only two political parties, when this happens one party (and the president/head of the Executive branch) may have the majority of the legislative branch.
On the economic aspect, the US government is the biggest economic entity in the US, and probably in the world, so its decision matters, and a lot. With the trillions at its disposal, it can channel fiscal policies that have repercussions in Nepal, and with its control of the most spread currency in the world, it can bring heaven or hell in emerging markets.

One of my co-workers thinks that healthcare reform will spell the end of Reaganomics as a viable econommic worldview. He is probably right...in the short-term. In the long-run I think Obama will spell the end of Keynesian economics. We are speeding towards the day when Social Security and Medicare will consume 100% of every dollar the US Government takes in. Healthcare will only get this day here faster. When this day comes Obamanomics will fail and take Keynes with him.

Keynesianism has nothing to do with what you described; Keynesianism states that when a capitalism system enters a depression, the most appropriate measure is to create a temporary budget deficit, in order to recover the economy; it believes that the economy can enter a sub-part global equilibrium with high unemployment, involuntary unemployment, because prices do not adjust to full employment.
As Marshall lived on after the Keynesianist revolution, and Keynes lived on after the Monetarist experiment, Keynes will live on after whatever Obama does; since Keynesianism did not only bring new ideas into the economic sciences, but also brought with it a new methodology, and a new view. Keynes is regarded as the founder of Macroeconomics (his new view), and macroeconomics is the most prolific branch of the economic sciences (since it is much more verifiable, and therefore, scientific), and it will not die soon, quite on the contrary.
Even Keynes' most intelligent critic, the deceased Milton Friedman, has stated that all the models used are Keynesian, which made him say that "we're all Keynesians now".

Reaganomics is not a school of thought, it is Keynesianism (since lowering taxes is a Keynesian policy) a lá Republican.

[Ericho]

Seeing as how the economy is doing so poorly now, it's fairly obvious it will take some time to get things back to normal. We can not simply hope Barrack Obama is going to fix things right away. I mean, seeing the mess that Bush left us, he's going to have to be really good, but I do have hope.

Granted, there's no guarantee he'll be a great President, or be able to fix these things up, but we just have to be hopeful and yet realistic at the same time. Great leaders like FDR have pulled us out of a major crisis before, so it can be done.

[TheMason]

At 12/16/08 05:41 PM, Der-Lowe wrote:

At 12/16/08 03:11 PM, TheMason wrote: Congress is more powerful than he in terms of domestic policy (the US president is actually the weakest chief executive in the Western/Industrialized world). Even still...congress does not have that much power over the economy and the market.

About the political system, the US political system is presidentialist and it is the one that concentrates the most power on a single person in developed nations; European countries go with a parliamentary system in which the power lies more in the Parliament. Also, few countries have only two political parties, when this happens one party (and the president/head of the Executive branch) may have the majority of the legislative branch.

Au contraire my friend. The US president is the weakest chief executive in terms of (especially) domestic politics in the Western/Industrializied world.

* Head of Government: While all executive powers reside in the presidency; the US president is seperate from Congress. This is not so in parliamentary systems. In these systems the PM (Prime Minister) more often than not remains a MP (Member of Parliament). This gives a PM greater power than a president. Our congress also has some very powerful leaders that can do things a PM can but a president cannot (such as control what legislation makes it out of committee).

* Since a president is not a member of congress...he cannot make laws. Therefore, while he can suggest laws...he cannot write one or introduce it. If he were to write legislation he would have to find a Rep or Senator sponsor it.

* The congress cannot be dissolved by the president (or government in parlimentarianism speak)...whereas parliaments more often than not can. (See what happened in Canada in recent weeks.)

* We have some exceptionally strong legislative leaders whose power rival the president's power. These include: Speaker of the House, Senate Majority Leader and House Majority Leader. Even when a member of the president's party...there are many cases where these people will fight the president's policy goals.

* To dovetail with the above point, in many parliamentary systems, where as Party Leader, the PM can deny MPs campaign funding if they do not vote the right way...effectively firing them.

These are but a few of the reasons why the majority of political scientists view the US president as the least powerful head of government in the Western/Industrializied world.

On the economic aspect, the US government is the biggest economic entity in the US, and probably in the world, so its decision matters, and a lot. With the trillions at its disposal, it can channel fiscal policies that have repercussions in Nepal, and with its control of the most spread currency in the world, it can bring heaven or hell in emerging markets.

Partially true. While it may be the single largest entity it does not account for a majority of our GDP but rather less than 20% (the Federal Budget accounts for 2.730 trillion compared to our GDP of 13.78 trillion). And while its reaction to crisis or fiscal policies will effect world markets...it does not have as large of an impact on economic or speculative "bubbles"...this is driven by market activities by individuals.

I cannot argue that you are 100% wrong and I'm 100% right...and neither can you. The truth is the US economy is so big that we are both correct.

Keynesianism has nothing to do with what you described;

Actually it does. What the criticism is that while Keynesian theory states that this deficit spending will be temporary...in practice these programs become permanent (in violation of the theory). This is where economics becomes political economy. What does governments do with economic theories?

We also see that Keynesian theory, when put into practice by politicians with no economics training, leads to central planning which will stifle the private sector and civil society.

The New Deal, Reaganomics and Obamanomics are not economic theories...true...however they are the observable policy implementations of economic theory.

[Conspiracy3]

At 12/16/08 03:11 PM, TheMason wrote: What you're talking about are called economic bubbles. My personal favorite is the Tulip Mania bubble of 1637. But anyway...
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There already is a significant investment in green tech. The market is moving there on its own accord. A new company, Aptera is producing a car that is capable of 300 mph.

Who cares if it goes 300 mph. There isn't a street in the world that you can legally drive that fast on.

There is a problem in thinking Obama's economic team is going to fix this situation. The market is not bursting because of Bush's or Clinton's policies...but the economic activities of consumers and producers. We like to think (even though it is wrong) that somehow the President has power over the economy. He does not. Congress is more powerful than he in terms of domestic policy (the US president is actually the weakest chief executive in the Western/Industrialized world). Even still...congress does not have that much power over the economy and the market.

The president does have some real power. It isn't as much power as some people think it is, but he does have some very strong power to influence economics. He cannot just simply press a button and fix everything, but he has a very strong influence.

One of my co-workers thinks that healthcare reform will spell the end of Reaganomics as a viable econommic worldview. He is probably right...in the short-term. In the long-run I think Obama will spell the end of Keynesian economics. We are speeding towards the day when Social Security and Medicare will consume 100% of every dollar the US Government takes in. Healthcare will only get this day here faster. When this day comes Obamanomics will fail and take Keynes with him.

Reaganomics never was a viable economic policy. The rich will hoard money not let it trickle down to the poor. Reaganomics encourages short term corporate growth, but long term instability. Medicare and social security will never control 100% of the value, there will still need to be a road system, military, police force, school system, and other govt expenses.

Personally what I think the world will (hopefully) end up as is a socialized system for necessities and a capitalized system for luxuries. With technological advances we are approaching a time when almost everyone will be unemployed. You will have a society in which a few people are billionares and everyone else starves to death. Eventually even the billionares will lose wealth with no one to buy their products. However, when that time comes the government should give bear necessities such as food and water (the bare minimum to survive) and shelter (just one cot out of several thousand lying in a warehouse.) For any standard of living beyond this a person must work to earn money for luxuries.

[aviewaskewed]

At 12/16/08 03:11 PM, TheMason wrote: What you're talking about are called economic bubbles.

And while they aren't good, they won't go away either because people never ever learn. They all want a quick fix, to make lots of money in a short period of time and they convince themselves the good times will last forever. Until people learn to be responsible and not over inflate these markets and try to cash in for themselves as much as possible leaving everybody else to suffer, this is always going to be an economic pitfall.

[n64kid]

At 12/16/08 07:15 PM, Conspiracy3 wrote:

Who cares if it goes 300 mph. There isn't a street in the world that you can legally drive that fast on.

300 Miles to the gallon is the claim. I checked it out seeing how Carlsbad is 100 miles away from my house.... they want about $30,000, want to mass produce the car, expect to do it by the end of this year, but currently have no factory. I'd say just wait for the Chevy Volt, assuming GM is still in business by 2010.

The president does have some real power. It isn't as much power as some people think it is, but he does have some very strong power to influence economics. He cannot just simply press a button and fix everything, but he has a very strong influence.

The president is basically an economic planner. Everything has to go through congress though.

Reaganomics never was a viable economic policy.

Except it is, and the opposite is never a viable policy.

The rich will hoard money not let it trickle down to the poor. Reaganomics encourages short term corporate growth, but long term instability.

Based off of? Seriously, it's like a fucking conspiracy with you. Go figure.

Medicare and social security will never control 100% of the value, there will still need to be a road system, military, police force, school system, and other govt expenses.

It's about half of the federal budget, and by state to state, varies between 20-40%. This is what cannot be sustained.

[dude908]

At 12/16/08 05:41 PM, Der-Lowe wrote:

At 12/15/08 09:02 PM, dude908 wrote: Forget about all of this we need to stabilize the housing market, that market is done and gone. We need to stabilize and find a new market like clean energy to turn to

As the Internet lives on after the .com crash, people will continue to live in houses, so your main argument is false. I think green companies will become more widespread, but that does not mean that it will be at the expense of losing a markets; entrepreneurs do act predatorily, but not that much, some remain in the area after the great collapse, as any microeconomic analysis would tell you. Despite your shaky base, I agree with the policy implications you mentioned; maintaining an inflated housing market does not seem rational, and green energy is interesting, although I do not think it is the magical solution; I see it as a long term commitment more than a short-term patch.

Yea but It isn't highly invested in anymore. In the crash people lost a lot of money and it lead to a recession. You didn't see them coming up with ways to bailout Newgrounds or any other site so.