Ron Paul: Stimulus Packages Will Turn Recession Into A Depression

[Velociryx]

NM...it's not even worth discussing.

/disgust

-=Vel=-

(funny how many armchair economists there are...if it's easy to solve the problems as everyone here who has all the answers makes it out to be, why aren't you in DC? The truth is...nobody has ever faced anything like this, so nobody really knows, and it's easy to sit around and gab about it till it's you with the pink slip. Then it's a whole different ballgame).

$0.02

[Naked Gents Rut]

Further, it strikes me as overestimating the short-term impact of the spending plan as relates to unemployment, and underestimating the long-term ill effects of the spending plan as relates to unemployment (the scenarios converge, which I don't think would happen in reality).

Well, it is an official product of the Obama administration; I think it's to be expected that they'd try to make the plan look as good as possible. What I find interesting is that the plan doesn't really look that necessary, even when portrayed in its best light.

if it's easy to solve the problems as everyone here who has all the answers makes it out to be, why aren't you in DC?

I'll be in DC after I graduate in May.

[DanS]

Did you get a job down here?

[Naked Gents Rut]

Pretty much. In the final interview stages with a couple agencies. Would have to be extremely unlucky at this point not to get an offer from at least one of them.

I hope I didn't just jinx myself...

[DanS]

Well, I'd hate to lose you to the dead hand of the government, but in this environment I guess a "good luck" is in order.

[Velociryx]

I'll be in DC after I graduate in May.

Well then, we'll count on the problem being solved by June...July at the latest.

-=Vel=-

[Naked Gents Rut]

Well, I'd hate to lose you to the dead hand of the government, but in this environment I guess a "good luck" is in order.

Nothing wrong with government employment at the moment. I might think this stimulus is bad policy, but that doesn't mean I'm above hopping on the gravy train.

[DanS]

(1) Gov't pay checks are relatively meager; not much of a gravy train
(2) DC isn't a town that encourages or even makes social room for risk-taking

[Naked Gents Rut]

I don't have to stay in government forever. Now seems like a good time to get in and get some experience/contacts that will pay off down the road after the private sector recovers.

[Victor Galis]

Exactly why I'm a libertarian. Government isn't managed by the best and brightest. It's managed by Congress. And the only problem that a Congressman ever tries to solve is getting reelected.

Well, luckily Congress and the captains of industry are hard at work fixing all of our problems.

I'd recommend you stock up on canned food, water, and fuel for a portable generator.

I can't believe so many people are convinced we need to spend trillions of dollars to get out of this recession a bit sooner...

What do we learn? So far the fall in employment is comparable to that in 1974-1975 and 1981-1982. If the comparison holds, the declines should end within the next four or five months. But we of course have no idea whether the comparison will hold. Past performance is no guarantee of future results.

http://curiouscapitalist.blogs.time.com/2009/02/09/comparing-this-recession-to-the-last-five/

http://www.minneapolisfed.org/publications_papers/studies/recession_perspective/index.cfm

It's been clear for a while that our society has lost all sense of perspective, but this is really ridiculous.

There's no sign that we've hit the bottom yet. Interest rates are already 0, which prevents the usual monetary cure attempted.

[notyoueither]

I wasn't addressing you. I was addressing the "OMG! We need to spend trillions or we'll end up in another Great Depression!" folks. You know who I'm talking about. Obama, Krugman, etc.

I think it's likely we are facing a depression sort of scenario, and I don't think the spending will be entirely effective. OTOH, I understand that the political establishment feels they have to be seen to be doing something.

The attempted bail out of GM and Chrysler in Canada was acceptable for me. It was the political thing to do when Ontario is/was facing a good chunk of its economy going into the crapper. I also found some mirth when the auto companies said 'no thanks' due to some of the conditions.

At any rate, perception is going to be quite important going forward.

[Straybow]

Hmmmm, let's see: A trillion dollars of deficit spending, when the banks and brokerages can't buy bonds because they're broke, and other countries won't touch that steeming pile with a ten foot pole.

Way to turn a recession into a depression, if that's what they want.

[notyoueither]

You could always try to justify a trillion or three to get the financial system fixed when nothing is done for the average Joe.

Assume it gets worse. A lot worse. There's a lot of social unrest that goes along with broadly felt, persistent hard times. Without doing something substantial to at least seem to try to blunt the pain, things can get pretty ugly.

[Naked Gents Rut]

I think it's likely we are facing a depression sort of scenario

Why? I really don't understand this...

[Agathon]

I can't believe so many people are convinced we need to spend trillions of dollars to get out of this recession a bit sooner...

It's been clear for a while that our society has lost all sense of perspective, but this is really ridiculous.

Don't smart people say that every recession is unique? Nobody knows what will happen. Unemployment figures aren't necessarily the best indicator of what is happening. One reason is that governments have gerrymandered the unemployment figures since the recession of the early 80s for political reasons. The rash of bank failures and bailouts has no real analogue since the war.

There's also the problem that the US and Britain face. People were quite happy to park their investments there because those countries were perceived as having strong financial systems, and in the case of the USA the world's reserve currency. Is it really rational to believe that any more, given the house of cards it turned out to be? Britain doesn't have very much to fall back on if the City loses its allure. What happens to Americans if the dollar is no longer the world's reserve currency?

The stimulus is a bet. You need to convince us that it's a bad one. If you can waste a trillion dollars on a bull**** war, what's the objection to using it to pay poets and performance artistes?