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What part of free market capitalism would impose a Federal Reserve banking cartel by federal law that could loan into such a bubble?
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What part of free market capitalism would take the US dollar of gold via presidential edict allowing for the unlimited expansion of money and credit into markets in 1971? ( https://wtfhappenedin1971.com )
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What part of free market capitalism would have this state imposed central bank lend a trillion dollars into subprime via government created corporations Freddie Mac and Fannie Mae? And have them lend that to minority families, even if the banks deemed it not prudent?
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What part of free market capitalism would have this state imposed central bank loan money into a housing bubble at 1.5% APR? Do you know any capitalists who are satisfied by a 1.5% APR return on investment?
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What part of free market capitalism would have this state imposed central bank cover counter party risk on CDO's, also causing CDO insurance to become mis-priced, until it didn't?
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What part of free market capitalism would run to the banks rescue with a 1 trillion dollar bailout, to cover them till the fed could lower interest rates back down to zero?
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What part of free market capitalism would reflate the housing bubble with 0% apr interest rates? Which seems to now be causing a bubble in every sector of the US economy.
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Bernie was right on one thing. We have socialism for the rich, neo-liberal capitalism for everyone else. Ideally, large corporations and their shareholders would have to play by rules as well, which meant that if they fail, Lloyd blankfein and his banker pals end up on the street as anyone else would and their “businesses” are forced to close. But with the big banks controlling the Fed, they bail out whomever they want, including themselves.
If only they had socialism for the rich, but didn't put in a bunch of taxes and regulations designed to fuck over everybody else, (and now closures) it might just be bearable.
One thing is for sure. We need to get off the government money, and tax system at all costs. If we don't find a way to get off this merry-go-round, we're doomed.
For the most part, a free market capitalist system is self regulating. Set your prices too high, a competitor will step in to undercut you. Reduce the quality of your product or service, again, a competitor will come along to offer something better. These natural forces act to keep the market in check. Some regulation is necessary, but I believe only to serve these three purposes: 1) Prevent parties to a transaction from committing fraud. 2) Prevent business (or individuals) from producing and/or selling products that cause harm (ex. excess pollution, unsafe products and foods, etc.). 3) Limiting monopolies. Beyond those three things, regulations that seek to "level the playing field", or that chose winners and losers in the market, tend to do more harm than good.
The systems to regulate our societies have to be extremely disciplined in their duties to regulate.
Jordan Peterson gave a good explanation of the law of accumulation which describes the tendency of wealth to accumulate to the very top, i.e. the "One Percent" (no, that is not a strictly American nor capitalistic feature). The problem then is that there is so little wealth at the bottom that if you start near 0 then it becomes statistically improbable to move up. This is not saying that its impossible but does emphasize the disparity of the situation that arises. People with nothing to lose start to reject the hierarchy and system that relegated them to poverty amd are more likely to revolt.
Community Reinvestment Act. Carter started it I think to stop red-lining. Clinton blew the doors off it and mandated that banks make ever increasing %s of subprime loans. I read that by the time the train left the rails, half of Fannie's were subprimes.
That was a big part of the problem. There was this belief that "why should we worry about subprime loans". After all, if they default, just sell the house, and those funds will pay off the loan. Somehow, the possibility that home values could fall never dawned on them. Then, when thousands of borrowers very quickly found themselves underwater on their loans, that turned out to be a rude awakening.
This is not capitalism, This is not democracy, This is not even socialism, This is an oligarchy.
They are not bound by borders or flags yet control almost every sovereign nation.
The answer to all of the above is George W Bush.
Were you hoping for something more “Jewey” sounding?
It's true that Bush presided over the bailout, but it's also true that Obama openly supported the bailout just as much, so we know this was going the same direction either way.
The bigger problem isn’t the buy outs of 2008-2009. It’s the buy-ins and buy-backs that have occurred constantly since.
Omg @Barbs, lay off your projections and Jewish victimization self hatred crap a bit please. It’s often about this in your comments and you are so very rude to the community here.