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Thread: How would the recovery come about?

  1. #1
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    How would the recovery come about?

    I'm not exactly au fait with economics.

    What circumstances would cause the recovery to occur, theoretically and practically speaking? The market bottoming out? A war?

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    When capitol is in the hands of consumers so they can spend it and create demand again. Strangely wealth is more concentrated in the USA or was in the Summer anyway than at anytime since 1929. Right now the people that are secure in their jobs are too scared to spend the money they have. I'm no expert but the experts got us here

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    experts are expert at leeching off the public and taking bribes from the special interests to spread their expertly biased commentary )
    Originally from Sochi, Russia.

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    Senior Contributor Versus's Avatar
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    Quote Originally Posted by Silent Hunter View Post
    I'm not exactly au fait with economics.

    What circumstances would cause the recovery to occur, theoretically and practically speaking? The market bottoming out? A war?
    War? No...It will end with the rise of China as the world superpower. It will go a little bit tough but at the end that is where it heads to. China will than invest in the US and the US will be China.

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    Official Thread Jacker Senior Contributor gunnut's Avatar
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    Obama will spend us out of this recession.
    "Only Nixon can go to China." -- Old Vulcan proverb.

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    Quote Originally Posted by Silent Hunter View Post
    I'm not exactly au fait with economics.

    What circumstances would cause the recovery to occur, theoretically and practically speaking? The market bottoming out? A war?
    Well

    A correction within a number of markets was long overdue.

    Real-Estate market is certainly seeing a huge correction now. Prices just couldn't keep going up.

    Similarly the market will sooner or later see a correction in terms of personal loans, credit cards and car loans.

    Banks around the world lent money in the past few years without actually checking if customers could actually afford the repayments or not.

    It is only a matter of time before the likes of Bofa start reporting on these bad debts.

    However once this cycle has passed, the financial system will have more or less been cleansed of most of its toxic debt.

    It therefore boils down to the market believing that no more toxic debt exists, the day that happens, the recovery begins.

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    a few thoughts.

    take a look at some of these pieces by businessweek, very interesting stuff.

    http://www.businessweek.com/magazine...annel_in+depth

    http://www.businessweek.com/magazine...el_top+stories

    from a clinical standpoint, this recession has shown us what happens when both areas of the free market and the government screw up. it's clear that without regulation, there will be actors whom seek to warp the free-market by illegal means. it's also clear that idiotic, badly-implemented regulations also cause economic loss.

    there's got to be a happy medium. from a US perspective, a recovery in the short-term would probably come about as a result of massive fiscal stimulus (which only the government can provide). in the medium-term, this means a combination of more, better-tailored, and much better implemented regulations. in the long-term, economic growth will occur only as a result of immigration liberalization and more importantly S&T development.
    There is a cult of ignorance in the United States, and there has always been. The strain of anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that "My ignorance is just as good as your knowledge."- Isaac Asimov

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    remember, spending does not create an economy, producing does. Borrowing money from the Chinese and then buying stuff does not create a real economy. It's shocking how many people are suckered into this fake consumption economy.

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    Former Staff Senior Contributor Ironduke's Avatar
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    Quote Originally Posted by Versus View Post
    War? No...It will end with the rise of China as the world superpower. It will go a little bit tough but at the end that is where it heads to. China will than invest in the US and the US will be China.
    I notice you use the definite article in the bolded excerpt. So you think that China will soon be elevated to the position of sole world superpower, and that the US will have a massive trade surplus exporting goods to an affluent Chinese populace with a GDP per capita of some $40,000, along with an increase of 1.5% employment in the agricultural sector to 50%?

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    Quote Originally Posted by Ironduke View Post
    I notice you use the definite article in the bolded excerpt. So you think that China will soon be elevated to the position of sole world superpower, and that the US will have a massive trade surplus exporting goods to an affluent Chinese populace with a GDP per capita of some $40,000, along with an increase of 1.5% employment in the agricultural sector to 50%?
    China don't have to be as rich as USA is now. All Chine need is to be richer then USA in future.

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    tphuang,

    remember, spending does not create an economy, producing does. Borrowing money from the Chinese and then buying stuff does not create a real economy. It's shocking how many people are suckered into this fake consumption economy.
    might have been true back in the 1940s but not today. notice that the chinese are as hard hit by the recession as the US is, otherwise they too would not be considering stimulus packages in the hundreds of billions.
    There is a cult of ignorance in the United States, and there has always been. The strain of anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that "My ignorance is just as good as your knowledge."- Isaac Asimov

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    Quote Originally Posted by Ironduke View Post
    I notice you use the definite article in the bolded excerpt. So you think that China will soon be elevated to the position of sole world superpower, and that the US will have a massive trade surplus exporting goods to an affluent Chinese populace with a GDP per capita of some $40,000, along with an increase of 1.5% employment in the agricultural sector to 50%?
    China is at the crossroad. If they decide to turn to themselves and start produce for themselves their economy will grow rapidly. But than, for that to happen the China's power structure, the government would have to loose its grasp on the population in order to create demand. Question is, are they ready to do that, to give up the political control in order to create a free market. I know that it sounds almost surreal and impossible for China to transform itself into some sort of USA part 2 but they have the manufacture, they have the resources and if they loosen up the control and let people to get richer a bit so that they can consume the goods I don't see why not. All this is purely hypothetical and although not so probable it is not impossible.
    Russia and their resources are very close, so raw materials are accessible, manufacture is there too with armies of hardworking people...all conditions are there for the China to rise very rapidly. And to add more to the mix, with the unemployment rising, public anger will rise to and the time when it was more profitable to beat workers on strike that demand their work places will not last long. It is only matter of time for them to realize that they have over one billion people that need to be turned into consumers so that the workers will have purpose to work. And where you have manufacture you will have R&D as well and with R&D goes science so potential for development is huge the only question is which form it will take.

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    Official Thread Jacker Senior Contributor gunnut's Avatar
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    Quote Originally Posted by tphuang View Post
    remember, spending does not create an economy, producing does. Borrowing money from the Chinese and then buying stuff does not create a real economy. It's shocking how many people are suckered into this fake consumption economy.
    If no one consumes, what do you do with your production?
    "Only Nixon can go to China." -- Old Vulcan proverb.

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    Quote Originally Posted by Versus View Post
    War? No...It will end with the rise of China as the world superpower. It will go a little bit tough but at the end that is where it heads to. China will than invest in the US and the US will be China.
    Yeah and the USSR is going to bury us and we are going to be an economic colony of Japan. We have heard this song before. American society because it is free unlike Chinese society is extremely agile and innovative. Just watch, the PC? Internet? high speed processors, hi speed internet, sat phones? What have the Chinese invented for the consumer economy? You cant be anything but number two w/o that component.

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    Quote Originally Posted by Roosveltrepub View Post
    Yeah and the USSR is going to bury us and we are going to be an economic colony of Japan. We have heard this song before. American society because it is free unlike Chinese society is extremely agile and innovative. Just watch, the PC? Internet? high speed processors, hi speed internet, sat phones? What have the Chinese invented for the consumer economy? You cant be anything but number two w/o that component.
    Gun powder, compass, rockets, first automated weapon...those are things that I can think of at the moment. They have the potential, that was my point. I don't know what will exactly happen with the USA since things slipped out of my projection range, but I hope that you will be able to pull out.

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