No matter what/how you think of Alan Greenspan, I still think he is probablly still THE best Fed Chairman ever. Sharp… Knows what he is talking about… Respect the power and effeciency of a free market… More likely than not, history will prove that his is right… -------------- Greenspan Warns of Risks From U.S. Debt By JEFFREY SPARSHOTT WASHINGTON—Former Fed Chairman Alan Greenspan said the U.S. could face a bond-market crisis if politicians don’t act soon to start cutting the nation’s debt. In an interview with Kelly Evans, Alan Greenspan discusses the dangers of current fiscal policy while challenging his critics to prove him wrong on any decision he made as Fed Chairman. In an interview Friday with The Wall Street Journal, Mr. Greenspan said that eventually Congress would pass a budget that includes many proposals by a White House debt-reduction panel. “I think that the type of budget agreement that was put together by Alan Simpson and Erskine Bowles is the type of budget that will be passed by Congress,” Mr. Greenspan said. “The only question is, will it be before or after the bond-market crisis.” The former head of the U.S. Federal Reserve was referring to the co-chairmen of the National Commission on Fiscal Responsibility and Reform, who last month won limited support for a sweeping overhaul of U.S. tax and spending policies that would cut $4 trillion in debt. Mr. Greenspan said the risk of a bond-market crisis is so great that he favors raising taxes immediately. “The probability that we will go through the next two or three years with no bond-market problems, no inflation problems, is probably better than 50-50,” he said. “But not much.” Mr. Greenspan said he thought the economy was gaining momentum, with the strongest signals of growth coming since the middle of last month. He credited the “wealth effect,” which refers to an increase in spending that accompanies escalating stock prices. Mr. Greenspan also defended his legacy, saying he had answered his critics with facts. “If they prove I’m wrong, I’ll change,” he said.
alphaseeker is a wild man, I like his style one line of Ayn Rand followed by an article
Ayn Rand would have disowned Greenspan when he was chairman.
Hmmm… low interest rates to prop up housing and spur private borrowing, plus advocating that people look into ARMs so that they can get a lower teaser rate and think they can leverage more than they really can. Then all goes to hell, and the private debt gets turned into public debt, because, of course, it would be a tragedy if bankers didn’t get bonuses for making ridiculous loan decisions and essentially false claims about the risks to the underlying capital. Yes, yes! Bailouts for all! 700 billion in tax cuts for the wealthiest is great, but 3.5 billion to help the unemployed… no, that’s too much to sacrifice… we’ve got this big deficit, you see. Sounds very pot-calling-kettle black-ish.
Washington’s punctured too many holes in the proverbial tax bucket. While the tax revenue flowing into it should be enough, congress keeps inventing new ways to spend those dollars. If they really wanted to clamp down on government spending they’d take a second look at the trillion dollar health care bill. Just sayin
Bill Gross also mentioned the deficit and potential losing AAA sovereign rating on recent memo. Alan is absolutely right about the potential “bond crisis” . Whether we can cut the deficit all lying in Congress’s hand. it will be tough since politicians naturally implanted to spending mode.
Mr. Greenspan said the risk of a bond-market crisis is so great that he favors raising taxes immediately.
Two examples: In a micro scope, a lot of the public services many cities and counties run can be cut. In the city I live, it’s a typical upper middle class suburb with medium housing price slightly over $1 million. Most households have cars, one could hardly imagine who needs public transportations? Yet the city, which is in the red, still offers pretty extensive bus services. I see the buses are pretty much empty most of the day. The users of them are mostly a few homeless people or guys you see standing outside home depot. That should be cut. At a macro level, the whole medicaid or medicare things need to trimmed. I know at least half a dozen immigrants from a variety of countries, right after getting their US citizenship, they bring their aging parents here to the US, apply green card for them so that they can enjoy free or almost free health care. You tell me… what did their parents contribute to the US to make them entitled to enjoy free health care funded by US tax payers?
Alphaseeker you are whining about pennies in a trillion dollar budget and like always giving silly anecdotal evidence. There is nothing genius about what greenspan said. Where was he when we engaged in multi trillion dollar military escapades and deficit financed tax cuts? To give him some credit, he was against the current round of tax cuts for the wealthy. You want to make a meaningful dent on the deficit? Go after the enormous waste and profligate spending in the DoD. US defense budget is larger then I believe all other countries combined and there is something wrong with that. Part of the problem is if you look at what is being put in the defense budget, you see a lot of things that make you shake your head. We are buying cold war era weapons systems, designed for large scale conflicts with the USSR, and that threat simply doesn’t exist (China, while it has built up its military, is a fraction of our spending, and they are not a threat to the US the way Russia was). For example, the pentagon recently needed 10 cargo planes, they said that with what they had would hold them for 10 years at least…when it got through congress, they ended up buying 20…why? Because the contractor was in Eric Cantor’s district in virginia. No one is arguing we don’t need a solid defense, we do, but it has to be for the threats of our time and it simply isn’t large scale military conflict. Quite frankly, in the war on terrorism, large scale military action has proven itself to be a lie, we invaded Iraq (and sorry, chief, it might have cost 21 days and a hundred lives to get Hussein, but you leave out the fact we have lost over 5000 lives of our troops and will have spent a trillion and a half dollars, and Iraq is still a mess, not to mention afghanistan). Buying more nuclear subs, buying more advanced fighters (when no one has fighters even near the capabilities of what we have today) makes no sense. The real issue here? Jobs. Take a look at where defense contractors are located, take a look at the congressional districts where they are located, and what do you find? Most of them are in the so called ‘red state areas’ or ‘red districts’ of blue states. Basically, a large part of defense spending is about bring home the gravy to their district, about that magic word, jobs. If we cut defense spending, what happens to Marrieta, Georgia, What happens to the plants in california, what happens when we close bases in small towns all over the country that depend on those based for the local economy? Take a look where these plants often are located, and what you find are places where defense is the employer, and congressmen and senators know if those jobs are lost due to cutbacks, they are toast. Our real threat is terrorism, and that requires lightening strike raids, special ops and things like intelligence gathering and black ops, not large scale military force. If anything, current events have proven out that the threat of military force means little. For example, we have North Korea and Iran with nuclear weapons or the threat of them, and what good is the military? We can’t take military action against North Korea, because they are the client of China and we dare not tangle with them, given the economic factors that make them a threat (hate to tell you, they aren’t worried about China because of military, it is the fear that they won’t buy our debt or dump their reserves of US dollars). We can’t hit Iran, because that would cause oil prices to go through the roof. The traditional military for most applications simply doesn’t fit the bill, yet that is what we are spending for.
^^ “You want to make a meaningful dent on the deficit? Go after the enormous waste and profligate spending in the DoD” Those entitlement spending are much lareger than DoD. Don’t you agree?
Greenspan rejected his formerly pro-free market views: http://www.usagold.com/gildedopinion/greenspan.html
AlphaSeeker Wrote: ------------------------------------------------------- > ^^ > “You want to make a meaningful dent on the > deficit? Go after the enormous waste and > profligate spending in the DoD” > > Those entitlement spending are much lareger than > DoD. Don’t you agree? That may be true, but how do you plan on getting rid of something which people have already paid into? I mean we can go with the recommendations of the bipartisan commission including raising the retirement age but that alone will not help, we must look at defense spending as well. But per Republicans, entitlements and defense are off the table. So we are at a stalemate. EVERYONE needs to feel the pain and the deficit reduction burden needs to be spread across the board, no matter how unpopular it is amongst the voting public. Instead of mass layoffs, maybe we can consider German style programs where everyone works fewer hours and gets paid less. At least people will not starve and become homeless.
http://en.wikipedia.org/wiki/File:U.S._Federal_Spending_-_FY_2007.png SS and Medicaid much larger than Defense. Although all three individually similar.
marcus phoenix Wrote: ------------------------------------------------------- > AlphaSeeker Wrote: > -------------------------------------------------- > ----- > > ^^ > > “You want to make a meaningful dent on the > > deficit? Go after the enormous waste and > > profligate spending in the DoD” > > > > Those entitlement spending are much lareger > than > > DoD. Don’t you agree? > > > That may be true, but how do you plan on getting > rid of something which people have already paid > into? I mean we can go with the recommendations of > the bipartisan commission including raising the > retirement age but that alone will not help, we > must look at defense spending as well. > > But per Republicans, entitlements and defense are > off the table. So we are at a stalemate. > > EVERYONE needs to feel the pain and the deficit > reduction burden needs to be spread across the > board, no matter how unpopular it is amongst the > voting public. Instead of mass layoffs, maybe we > can consider German style programs where everyone > works fewer hours and gets paid less. At least > people will not starve and become homeless. SS is something we paid into. True. But Medicaid and medicare not. That’s the 2nd example in my earlier post. Your take on my 2nd example?? Here is another example, in today’s Journal, a 26 year old guy named Martin xxx was accidently shot in the neck by his stepbrother. He is wheel chair bound now. His family doesn’t have the means to take care of him, so he was able to be sent to a nursing home on Medicaid. How fair is this? His brother shot him, and now he is living on your (Marcus Phoenix’) dime? What did you, Marcus Phoenix, do to deserve this burden? This is true socialism… And it shoud be cut.
Why do people keep calling it Entitlements… just go ahead and say we need to cut Social Security and Medicare.
marcus phoenix Wrote: ------------------------------------------------------- > The real issue here? Jobs. Take a look at where > defense contractors are located, take a look at > the congressional districts where they are > located, and what do you find? Most of them are in > the so called ‘red state areas’ or ‘red districts’ > of blue states. Basically, a large part of defense > spending is about bring home the gravy to their > district, about that magic word, jobs. If we cut > defense spending, what happens to Marrieta, > Georgia, What happens to the plants in california, > what happens when we close bases in small towns > all over the country that depend on those based > for the local economy? Take a look where these > plants often are located, and what you find are > places where defense is the employer, and > congressmen and senators know if those jobs are > lost due to cutbacks, they are toast. i agree that large standing armies are not a logical choice anymore. i’m sure the savings from not having to train 800k people consistently would have a major impact on DoD spending. heck, if you could get those 800k people to ride energy producing bicycles for employment, they might actually benefit society. i disagree that all defense spending is bad. sure, standing armies don’t prevent war anymore, but Ohio and Virginia class submarines do. these subs have virtually made invasion of North America or any of its major allies a death sentence. same goes for bombing NA or its allies. we do need to continue developing earth destroying devices for the sake of scientific development and insurance against a nuclear world war. so long as china/russia/iran knows the US has the most powerful weapon every conceived lying just off each of their respective coasts, undetected, they would never be an aggressor.
So you want him on the streets? That might end up costing us more in the long run. You know what, why don’t we just shoot everyone over 70 or 75 in the head? They are of no use to the society anyways. Lets get rid of the handicapped too while we are at it.
MattLikesAnalysis Wrote: ------------------------------------------------------- > marcus phoenix Wrote: > -------------------------------------------------- > ----- > > The real issue here? Jobs. Take a look at where > > defense contractors are located, take a look at > > the congressional districts where they are > > located, and what do you find? Most of them are > in > > the so called ‘red state areas’ or ‘red > districts’ > > of blue states. Basically, a large part of > defense > > spending is about bring home the gravy to their > > district, about that magic word, jobs. If we > cut > > defense spending, what happens to Marrieta, > > Georgia, What happens to the plants in > california, > > what happens when we close bases in small towns > > all over the country that depend on those based > > for the local economy? Take a look where these > > plants often are located, and what you find are > > places where defense is the employer, and > > congressmen and senators know if those jobs are > > lost due to cutbacks, they are toast. > > > i agree that large standing armies are not a > logical choice anymore. i’m sure the savings from > not having to train 800k people consistently would > have a major impact on DoD spending. heck, if you > could get those 800k people to ride energy > producing bicycles for employment, they might > actually benefit society. > > i disagree that all defense spending is bad. sure, > standing armies don’t prevent war anymore, but > Ohio and Virginia class submarines do. these subs > have virtually made invasion of North America or > any of its major allies a death sentence. same > goes for bombing NA or its allies. we do need to > continue developing earth destroying devices for > the sake of scientific development and insurance > against a nuclear world war. so long as > china/russia/iran knows the US has the most > powerful weapon every conceived lying just off > each of their respective coasts, undetected, they > would never be an aggressor. I am not saying there is no need for conventional weapon systems, we need to reign in the excess.
marcus phoenix Wrote: ------------------------------------------------------- > So you want him on the streets? That might end up > costing us more in the long run. > > You know what, why don’t we just shoot everyone > over 70 or 75 in the head? They are of no use to > the society anyways. Lets get rid of the > handicapped too while we are at it. I didn’t say to put his mon the street… Did I? He, his stepbrother, his famiy are on their own. They created the sitaution they are in, they should solve it. Is that not fair? Question to you, Marcus Phoenix, given his scenario, how would he be treated in your home country, India?
AlphaSeeker Wrote: ------------------------------------------------------- > marcus phoenix Wrote: > -------------------------------------------------- > ----- > > So you want him on the streets? That might end > up > > costing us more in the long run. > > > > You know what, why don’t we just shoot everyone > > over 70 or 75 in the head? They are of no use > to > > the society anyways. Lets get rid of the > > handicapped too while we are at it. > > > I didn’t say to put his mon the street… Did I? > > He, his stepbrother, his famiy are on their own. > They created the sitaution they are in, they > should solve it. > > Is that not fair? > > Question to you, Marcus Phoenix, given his > scenario, how would he be treated in your home > country, India? My home country is not india. regardless we should not be copying bad practices of india or china.