The Crash of 2008?

http://www.humanevents.com/article.php?id=23465

The Crash of 2008?
by Patrick J. Buchanan (more by this author)
Posted 11/16/2007 ET
Updated 11/16/2007 ET


In March 1929, the Harding-Coolidge era came to an end. The eight years had witnessed the greatest peacetime prosperity of any nation in history: America in the Roaring Twenties. Early that March, Calvin Coolidge handed the presidency over to Herbert Hoover, who had just pulled off a third straight Republican landslide.

"I do not choose to run," said Coolidge, who could easily have won a second full term. Silent Cal went home. Hoover, whom he privately derided as "Wonder Boy," presided over the Crash of '29 and the first three years of the Great Depression.

History holds Harding, Coolidge and Hoover responsible for the Depression, with Treasury Secretary Andrew Mellon, and Reed Smoot and Willis Hawley of Smoot-Hawley fame, as accessories. As Voltaire observed, history is a pack of lies agreed upon.
Two men debunked the myth that the low-tax, high-tariff policy of the 1920s brought on the Depression. The more famous is Milton Friedman, who proved to the satisfaction of a Nobel Prize committee that the Depression was a monetary phenomenon. The Fed had opened the sluices, and the money had swamped the stock market.

When Wall Street crashed, there came a run on the banks by men who had bought on margin, a depositors' stampede, a bank collapse, a wipeout of uninsured savings and the loss of a third of the money supply, lifeblood of the economy. The Fed never gave the nation the needed transfusions. Hoover and FDR, misdiagnosing the crisis, raised taxes and wrote up new regulations, which was like putting a body cast on a patient in shock from the loss of a third of his blood.

The Smoot-Hawley myth, repeated by John McCain in the Detroit debate, was demolished by Alfred Eckes of Ohio University, Reagan's man at the FTC and America's foremost authority on the history of trade and tariffs, in his 1995 "Opening America's Markets."

The point of this brief history: The recent hand-off from Alan Greenspan, the maestro of the Global Economy, to Fed Chairman Ben Bernanke may turn out to have been a lateral far behind the line of scrimmage, leaving Bernanke holding the bag for a recession for which he is no more responsible than was the hapless Hoover.

Last week, the stock market saw 4 percent of its value wiped out. Oil reached nearly $100 a barrel. The dollar fell to record lows against the Canadian dollar and the euro. The price of gold was $850 an ounce, signaling inflation and a worldwide lack of confidence in the Fed's ability or determination to defend the world's reserve currency.

The Chinese, with $1.4 trillion in reserves, perhaps 80 percent in dollar assets, indicated they may dump dollars and move into euros. Merrill-Lynch took an $8 billion hit. Citibank is signaling massive losses from its subprime mortgage debt. General Motors reported an operating loss of $1.6 billion for the quarter and a whopping $39 billion charge that is among the biggest profit hits ever reported

Where does this leave Bernanke? On the horns of a dilemma.

Exposure of all that subprime debt going rotten on the books of our biggest banks, the staggering losses being reported, the inability of homeowners to refinance or borrow any further against their equity, the credit crunch -- all argue for an easy money policy to get capital back into the economic bloodstream.

Thus the Fed has cut interest rates from 5.25 percent to 4.5 percent, thus the howls for deeper cuts, thus the market anticipation of another cut, though the Fed has said no more.
But the Fed is responsible not only for the national economy. It is responsible for defending the dollar, which represents the real savings and wealth of the nation. And that dollar has lost more value in seven years than in any similar period in modern history. A euro, worth 83 cents the year Bush was elected, has risen in value to $1.47.

As the dollar sinks, exporters may cheer rising sales, but at home we will soon find that the prices of all those imported goods from Europe and Asia down at the mall are starting to rise. U.S. soldiers, diplomats, tourists and businessmen overseas are already feeling the pain of a falling dollar.

If a recession is generally a sign the Fed should loosen up, a run on the dollar is a sign the Fed should tighten by raising interest rates to make dollars and dollar-denominated assets more attractive.

But the Fed's raising of interest rates would push up the rates on mortgages, credit cards and auto loans, and push millions of marginal folks into bankruptcy and the country into recession, a disaster for the Republicans.

But, given their free-trade fanaticism and free-spending ways, that fate would not be undeserved. Say a prayer for Ben Bernanke. He may have to eat the football that scrambling quarterback Greenspan tossed to him far behind the line of scrimmage.

The sad thing is that the high gas prices, mortgage crisis, and housing slump are all an orchestrated plan to make the economy sick prior to the 2008 elections. The DEMs know their weak on national security (their on the other side of the war with the enemy), want high taxes, and without a crisis of some kind they knew they hadn't a chance to win. So we have high gas prices without a shortage in sight and a sudden mortgage crisis to knock the economic legs out from under the conservatives.

"It's the economy stupid."

Anyone who doesn't think history repeats itself?

[quote]The sad thing is that the high gas prices, mortgage crisis, and housing slump are all an orchestrated plan to make the economy sick prior to the 2008 elections. The DEMs know their weak on national security (their on the other side of the war with the enemy), want high taxes, and without a crisis of some kind they knew they hadn't a chance to win. So we have high gas prices without a shortage in sight and a sudden mortgage crisis to knock the economic legs out from under the conservatives.[/quot

What rubbish, how are they plotting to do this? Give me direct links between legislation proposed/passed by Democrats and current economic difficulties (I expect more than one). Do you think that all Democrats are evil and actually genuinely want to hurt the country and people they represent? Because if you do then something is seriously wrong with your country. I think Republicans are selfish, pig-headed bible bashers, but by-and-large I think they probably are trying to do what they think is best for the country. Not everything is some liberal plot, get a grip.

[quote="Bilbo Baggins"]

The sad thing is that the high gas prices, mortgage crisis, and housing slump are all an orchestrated plan to make the economy sick prior to the 2008 elections. The DEMs know their weak on national security (their on the other side of the war with the enemy), want high taxes, and without a crisis of some kind they knew they hadn't a chance to win. So we have high gas prices without a shortage in sight and a sudden mortgage crisis to knock the economic legs out from under the conservatives.[/quot

What rubbish, how are they plotting to do this? Give me direct links between legislation proposed/passed by Democrats and current economic difficulties (I expect more than one). Do you think that all Democrats are evil and actually genuinely want to hurt the country and people they represent? Because if you do then something is seriously wrong with your country. I think Republicans are selfish, pig-headed bible bashers, but by-and-large I think they probably are trying to do what they think is best for the country. Not everything is some liberal plot, get a grip.

And that's the basic difference between good (conservative) and evil (leftist)

Bilbo I know that not all Democrats are evil people out to hurt America. I was a Democrat until 1999 and a Republican until 2007 and I know that there are people behind both parties who are evil and are out to hurt not only America but everyone else too. Both of our political parties are so corrupted by global corporation interests that neither can be trusted and honestly whatever political parties you have in NZ probably are too. Take a long hard look at your own institutions and if you hear or see anyone hawking a global agenda then you're already infected.

Here in the US we're on the Bush / Clinton / Bush / Clinton ride and it does not bode well for us. There isn't a twitch of difference in what a Bush or a Clinton will do in any specific matter even though they act like they're polar opposites. Now that the American public has finally wised up to the point that even our lesbians don't like bush anymore we're provided with the Rudy Giuliani and the Mitt Romney Bush clones to continue our slide into hell. Doesn't matter because I promise that Hillary will cheat and lie her way into the WH this time around and we'll have another Bush running in 8 years to finish the North American Trading Union project and finally erase our national sovereignty.

Stop confusing the real enemy by using the term Democrat and Republican when referring to American politics. Both parties are lost.

Bilbo I know that not all Democrats are evil people out to hurt America. I was a Democrat until 1999 and a Republican until 2007 and I know that there are people behind both parties who are evil and are out to hurt not only America but everyone else too. Both of our political parties are so corrupted by global corporation interests that neither can be trusted and honestly whatever political parties you have in NZ probably are too. Take a long hard look at your own institutions and if you hear or see anyone hawking a global agenda then you're already infected.

Here in the US we're on the Bush / Clinton / Bush / Clinton ride and it does not bode well for us. There isn't a twitch of difference in what a Bush or a Clinton will do in any specific matter even though they act like they're polar opposites. Now that the American public has finally wised up to the point that even our lesbians don't like bush anymore we're provided with the Rudy Giuliani and the Mitt Romney Bush clones to continue our slide into hell. Doesn't matter because I promise that Hillary will cheat and lie her way into the WH this time around and we'll have another Bush running in 8 years to finish the North American Trading Union project and finally erase our national sovereignty.

Stop confusing the real enemy by using the term Democrat and Republican when referring to American politics. Both parties are lost.

I completely agree with almost everything. Both parties are lost to global corporations, and this is becoming true in NZ, though I think the Labour party is quite as bad as the National (not that I support them anyway). Though doubtless we have differing views on many things that need to change, most candidates for the US Presidency are all exactly the same. The media tries to beat up big differences but I think essentially they are the same. For my mind the Democrats are the lesser of two evils.

Take a long hard look at your own institutions and if you hear or see anyone hawking a global agenda then you're already infected.

I'm not quite sure what you mean by this, as I'm aware some of you are quite anti-international organisations and their like. By 'global agenda' do you mean promoting the UN, WTO or other such institiutions, because I don't think all of these are bad.

The UN and WTO are the worst of the non governmental folks set to make you dance to their tunes. The one world government types and the New World Order folks are the enemy my little leftist friend. The fact that you fail to see them as the problem may be due to the fact that the left has always had more of a follow the leader mentality and chants most any slogan they can sound out and bleat in unison.

I don't like the WTO as free trade for all nations just doesn't work, and the World Bank and IMF are pretty much as bad. The UN has its problems, but the concept isn't bad. Allowing the permanent members of the Security Council a veto has really diluted its power but the US probably wouldn't have joined without it.

The fact that you fail to see them as the problem may be due to the fact that the left has always had more of a follow the leader mentality and chants most any slogan they can sound out and bleat in unison.

Thank you for that insight into the human brain Dr Buzzy, I'm sure your credentials in this area are impeccable.

Well not impeccable but pretty damned good for all that. The Dr. is pretty much an honorary title here unless you're an MD.

Honestly unchecked free trade is exactly as stinky as socialism, just as rife with corruption and greed. Free trade is the stuff of slavery and exploitation of third world nations and peoples for the profit of international corporations who have paid off governments just for opportunity of cheap labor. The difference is that socialist governments do the same thing to their own people and cut out the middleman of the corporation. Now the ChiComs have found the exact worst of both worlds.

Global Free Trade is hardly a conservative ideal and that's exactly why I'm not a Democrat or Republican but an independent. I'm the guy who has a the same problem with exporting democracy as he does with Russia, or Venezuela exporting socialism. On the other hand I would have gladly turned Afghanistan into a sea of glass on 9/12/2001 for hosting al Qaeda for their attack on the US. I speak softly and keep to myself until the time when I need to a big stick to beat back the Godless savages who would threaten my country. Then again if you're not a threat I think you can do exactly what you want and I could scarcely give a shit.

For my own country I like freedom with just the right amount of government regulation to keep business from screwing over the citizen. I like my government local unless it absolutely has to be on the national level. I like my military strong and powerful because my enemies should know I'm not afraid to use them if threatened or attacked.

The UN is the machinery that takes what little influence you have in the government of your nation and hands that over to people who don't even live in your country. How sick is that?

Free Trade is as much intellectual masturbation as socialism is.
Both are idealized to the point of impossibility.

The recipe for a recession is a no brainer....You have oil price skyrocketing, the dollar is going south and you have leftist carpet cunts (LCCs) saying if they win the election next fall they are gonna raise taxes.

iluvfreebeer wrote:Free Trade is as much intellectual masturbation as socialism is.
Both are idealized to the point of impossibility.

Both ideals ignore the unlimited capibility for greed in humans. With "free trade" it's greed for money and "socialism" it's greed for power. I like things more in the middle where there are limits placed on both the politicians and the corporations. The older I get the more I like Lou Dobbs too. Hmmmm

I believe, that in FACT, you are Loud Dobbs!!!