Ron Paul: Stimulus Packages Will Turn Recession Into A Depression

[Naked Gents Rut]

The paper seems to be a study of local or regional crises

The effects of the Asian Financial Crisis weren't limited to Asia.

I was under the impression those Belgian and British banks were significant.

America, England and Belgium aren't a good proxy for the entire financial world. Like I said, you're ignoring Asia and much of Europe.

[notyoueither]

The paper seems to be a study of local or regional crises

The effects of the Asian Financial Crisis weren't limited to Asia.

Did it accompany recession everywhere, at once?

[notyoueither]

America, England and Belgium aren't a good proxy for the entire financial world. Like I said, you're ignoring Asia and much of Europe.

Spain, Russia, China...

These are the places I have heard of more than normal turmoil just from paying a little attention to the news.

[Naked Gents Rut]

Did it accompany recession everywhere, at once?

I take it you're not going to accept any historical examples that don't exactly match the circumstances today. I think that's a good way to logically approach this issue.

These are the places I have heard of more than normal turmoil just from paying a little attention to the news.

Where are their bank failures? And you should really read more about Japan, Germany, France, Italy...

[notyoueither]

Did it accompany recession everywhere, at once?

I take it you're not going to accept any historical examples that don't exactly match the circumstances today. I think that's a good way to logically approach this issue.

That's because nothing historically after 1929 matches what is happening.

[notyoueither]

Did it accompany recession everywhere, at once?

I take it you're not going to accept any historical examples that don't exactly match the circumstances today. I think that's a good way to logically approach this issue.

That's because nothing historically after 1929 matches what is happening.

There are major banks in trouble as of last month.

Was it last week that there were headlines of Britain being bankrupt?

This is far from over.

[Naked Gents Rut]

You do know that over a thousand U.S. banks failed in 1988 and 1989 due to the S&L Crisis, right? No depression after that...

[notyoueither]

Yes, I know.

Was that accompanied by a plunge in shipping rates as global trade froze up?

[Naked Gents Rut]

I give up.

[notyoueither]

Good.

A ninety percent decrease in shipping rates is not a sign of no worries. Instead, it reminds me of 'What, me worry?'

[Naked Gents Rut]

Where did I say there was nothing to worry about? All I've said is that fears of a depression are misguided. The vast majority of economists seem to agree with me.

[notyoueither]

The vast majority of economists saw nothing wrong in the summer of 2006.

It's not a science like chemistry.

There is no cover in fallacies of appeal to authority.

[notyoueither]

And again, a depression is a recession of long or severe form.

What is the alergy to the concept that we may have a depression?

Are you afraid of soldiers marching on Washington? Er... OK. I see.

[Agathon]

Nobody knows what will happen.

That's no justification for this spending spree. We know what's likely to happen based on historical experience, which is the best evidence we have to go on.

Which historical experience? When was the last time all of the investment banks in the US basically died or reinvented themselves?

When was the last time it happened in a heavily deregulated and globalized market?

Now? Yes. Just look at the yields on U.S. Treasuries for proof.

And one could easily counter that this is faith or fear in action.

I'm not so sure it will be rational in a couple years when the recession is over and previously-panicked international investors stop and think about what the recent addition of trillions of dollars to the already large U.S. national debt really means.

It means inflation. Creditors will lose some money. In the vast scheme of things, that isn't a big deal.

No, I don't. An intelligent person doesn't gamble with trillions of dollars.

They do if there's a risk of the entire economy bottoming out.

[Agathon]

You do know that over a thousand U.S. banks failed in 1988 and 1989 due to the S&L Crisis, right? No depression after that...

No. Check the figures. Those failures were concentrated over 4 years, and all of them over a period of nine years.

But was that recession preceded by over a decade of orgiastic consumption and borrowing based on inflated stock and house prices?

It's not just bank failures and unemployment, but a whole lot of things at once, and on a worldwide scale. That seems to me to be unprecedented. Like the British government mass nationalizing banks.