Comments on: Here’s the path around the fiscal cliff http://blogs.reuters.com/nicholas-wapshott/2012/12/03/heres-the-path-around-the-fiscal-cliff/ Wed, 26 Nov 2014 19:47:54 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: matthewslyman http://blogs.reuters.com/nicholas-wapshott/2012/12/03/heres-the-path-around-the-fiscal-cliff/#comment-143 Thu, 06 Dec 2012 10:22:15 +0000 http://blogs.reuters.com/nicholas-wapshott/?p=70#comment-143 @Wapshott: An aside: Every time I read your name, it makes me think of a 17th/18th Century firearm, or makes me visualize a 16th Century type of ammunition for cannon. It sounds old. Where does your name come from? This looks somewhat convincing to me:
http://www.houseofnames.com/wapshott-fam ily-crest

]]>
By: matthewslyman http://blogs.reuters.com/nicholas-wapshott/2012/12/03/heres-the-path-around-the-fiscal-cliff/#comment-142 Thu, 06 Dec 2012 10:18:20 +0000 http://blogs.reuters.com/nicholas-wapshott/?p=70#comment-142 @Pete_Murphy: That’s right. The Chinese “lend” money to the USA in the same way that I “lent” money to my grandmother when I was ten years old, playing a game of Monopoly with her that I wanted to win with as much money as possible… I kept “lending” her more and more money so that I could get a bigger win in the end! After about six hours, she tired of the game (unsurprisingly). How long will it take for the US government to notice what’s happening, or, to admit to the American people that (as has been stated by UK politicians such as Vince Cable), we are in the “economic equivalent of war”?

]]>
By: Pete_Murphy http://blogs.reuters.com/nicholas-wapshott/2012/12/03/heres-the-path-around-the-fiscal-cliff/#comment-139 Wed, 05 Dec 2012 11:57:43 +0000 http://blogs.reuters.com/nicholas-wapshott/?p=70#comment-139 This may be the dumbest analysis I’ve seen yet of the “fiscal cliff,” accompanied by the worst prescription for its cure.

Describing our deficit problem as “spending too much and raising too little, paid for by borrowing from the Chinese” displays a lack of understanding of the role our trade imbalance plays in driving deficit spending. A massive trade deficit drains dollars from the economy, dollars that have to be plowed back into it through deficit spending to avoid a state of permanent recession. The Chinese don’t “lend” us money out of the goodness of their hearts or because we begged them for it. They buy U.S. debt because their trade dollars are worthless if not invested in dollar-denominated securitites.

The belief that cutting federal revenue could somehow offset the negative consequences of our trade deficit and somehow, magically, boost growth is what got us into this mess in the first place. There are no genuine solutions to the “fiscal cliff” that don’t begin with addressing our failed trade policy and restoring a balance of trade.

Pete Murphy
Author, “Five Short Blasts”

]]>
By: stevedebi http://blogs.reuters.com/nicholas-wapshott/2012/12/03/heres-the-path-around-the-fiscal-cliff/#comment-135 Tue, 04 Dec 2012 21:24:36 +0000 http://blogs.reuters.com/nicholas-wapshott/?p=70#comment-135 The problem is that the current President is not in favor of Capitalism, and cannot grow the economy. It is not his fault; he was indoctrinated as a youngster with socialist ideas, and he is by nature totally inflexible and unable to change course. If Hilary had been elected in 2008, the economy would have recovered by 2010 at the latest. The same is true of either John McCain. The technical indicators of the end of the recession were in June of 2009. This current President is directly responsible for lack of recovery. But because he is winsome and personable, and because the people believe him, he was re-elected. Socialist ideas don’t work even in Communist countries, much less Capitalist countries.

Without growth there can be no real increase in income, or decrease in spending (as a % of GDP). I see no hope of this before 2017. Even then, there will be 8 years of damage to undo, and a deficit that will most likely be over 20 Trillion dollars.

]]>
By: Gordon2352 http://blogs.reuters.com/nicholas-wapshott/2012/12/03/heres-the-path-around-the-fiscal-cliff/#comment-134 Tue, 04 Dec 2012 15:31:20 +0000 http://blogs.reuters.com/nicholas-wapshott/?p=70#comment-134 This is nothing more than a pathetic attempt by yet another wealthy person to frighten the American people, UNLESS of course we lower taxes on the wealthy class.

In which case, everything will be back to “normal” — supposedly the old trickle down theory of wealth overflowing to the masses to create jobs. Whenever I hear anything that approaches that “philosophy” I think of an overflowing toilet, because that is the only kind of trickle down the rest of us will ever get from the wealthy class — but in this case it is the “norm” that has driven us to the edge of the “fiscal cliff”.

This isn’t about economics — it is about greed by those who have ruined this country in every way imaginable, and now have the unmitigated gaul to want the 99% to pay the bill.

Recucing “social expenses” in the future is ludicrous, since they will grow — due mainly to the baby boomers retiring — not shrink, so your idea of magically reducing public spending is disingenuous.

My solution is a whole lot simpler than yours — PAY YOUR FAIR SHARE OF TAXES and stop whining about it, OR face a forced redistribution of income.

THAT is the real path around the “fiscal cliff” that YOU people created.

]]>
By: BidnisMan http://blogs.reuters.com/nicholas-wapshott/2012/12/03/heres-the-path-around-the-fiscal-cliff/#comment-133 Tue, 04 Dec 2012 10:18:26 +0000 http://blogs.reuters.com/nicholas-wapshott/?p=70#comment-133 All I read is: “Re-inflate the bubble please!”. America and the rest of the world needs to realise you cannot ‘engineer’ the boom and bust of economies. That is exactly what was attempted in the Clinton years – money was borrowed and pumped into the economy at an unprecedented rate and everyone celebrated their ingenuity as the debt of the Reagon era was apparently repaid, however, the problem is that this debt was paid off with ‘bubble froth’ and not with sustainable economic activity (think main street industries). The real solution is that America needs to get off two practices: firstly, fractional reserving. Banks should be allowed to lend out money they have, not 10 times the money they have. Second, borrowing to fund the government’s budget – if the government wants to spend it must be on a cash basis. Now I understand that this will involve a massive contraction of cash and related unemployment – but America will rebound as it always does (think back to the Great Depression), and when it does it will be solid as a rock and not a house of cards. Alternatively, we can continue delaying the pain and have the financial engineers of government and business continue to rob the rewards of main street and the salary earner. Pick wisely.

]]>