At 10/13/11 12:18 AM, Iron-Hampster wrote: here is a good, simplistic reading of the situation as a whole.
in short: yes it will stick, yes it SHOULD stick, and most importantly: read it before posting a rebuttal.
I'm not impressed. It's a bunch of statistics without analysis. Ok, we get it. Corporation profits are high. Does it say why? No. CEOs get paid a lot more than they used to. Why is that? The people at Business Insider don't know, or at least don't care to tell us. Average hourly earnings are stagnant. Why would they be anything else? Hourly waged workers are almost always less skilled (i.e. more replaceable) than salaried employees. Advances in technology increase the relative productive capacity of capital compared to labor, so the natural trend in business is to employ as much capital as possible and maintain it with fewer, but more capable, workers.
So the bailouts didn't bring about a new age of prosperity. You don't say? The bailouts were never meant to promote lending anyway, only to keep the banks from collapsing entirely. It was inevitable that banks would restrict credit after such a close call. It's motivated by almost the exact opposite of greed, really. It's a very conservative approach that trades profits for security. Why else are they investing in US Treasury bonds? If it were greed, they'd be purchasing junk bonds like crazy, unconcerned with solvency because the Fed would just bail them out again.
Regarding the one graph, the Fed is paying them interest on excess reserves in order to encourage solvency. Even with the bailouts to major institutions, hundreds of banks still failed. The bailouts were directed at specific banks with enough toxic liabilities to scerw up the whole system. The bailouts let these banks meet their obligations to all the smaller banks, preventing a cascade of failures. Notice how the graph doesn't tell you the excess reserves of bailed out institutions like Bank of America.
It did get one thing right; the protesters share the same lazy, half-assed understanding of the actual issues. If the protesters were well informed and intelligent, you can bet they'd come up with a better policy proposal than "give us these people's money."
