*** CORRECTION *** _spend_ government money

1. This is something Obama was asked about in the first debate, and he failed badly. His spending programs will be impossible to undertake without large new taxes. He and others can argue that the spending will be stimulative, but obviously the taxes are going to create the opposite effect. And about that stimulation,

2. As we saw not only with the Great Depression (yes, it was World War II that ended it) and as we saw with the modern Japanese deflationary episode in the 1990s, all the public works and other forms of spending failed to end the deflation. It's public sentiment that counts, and no amount of stimulative spending will stimulate the economy if the public is reluctant to spend or has learned to wait for lower prices! (To try to force people to spend by negative interest rate schemes, levying taxes or other charges on savings, or more broadly on currency, is immoral, perverse, tyrannical.)

(Getting out of deflation has been considered by a number of minds since Japan's deflationary experience in particular.)

http://www.res.org.uk/society/mediabriefings/pdfs/2003...

http://www.jcer.or.jp/eng/pdf/kinyuE8.pdf

http://www.princeton.edu/svensson/papers/jep2.pdf

http://www.nber.org/~wbuiter/liqnew.pdf

“the author [Jazz Shaw] did not advocate economic collapse as the *best* (or even desirable) means of reaching a society that embraces greater savings, less debt, more family, and less excess consumerism”

Of course he didn't, and only the intellectually immature would believe that. It is simply a fascinating topic meriting time and thought, and it's obvious fact that such an event (or a less striking version of it) is not something to be simply dismissed or seen blindly and stupidly as nothing but disaster and strife.

Good thread here. Floor yielded.

Yep, like the older guy who was one of my bosses in Seattle said to me one day during a long chat about anything and everything in his office. Kids would actually get a damn stick in their hands and play “army” or build a fort outside rather than play video games!

While I still see plenty of people here using credit cards to eat out or buy things in the morning at Starbucks, I and plenty of us have been on a cash basis since childhood, and we _don't_ routinely borrow for commonplace everyday expenses! We _don't_ borrow to replace our motor vehicles. (The used truck I bought and own now and the used truck I bought before that were paid in full from the start, with cash.) It is far from correct to say “We” borrow; plenty of “us” do _not_ borrow for everything we “pay” for!

A big crash followed by deflation even worse than Japan would do many a lot of good.

Of course what and who are destined to fail should be allowed to fail, rather than bailed out. Sadly, that will not be the case.

If what was postulated were to happen? We'd not only survive, but it would force many to wake up and would do a lot of people, particularly those with a childish entitlement mentality, a lot of good, whether they could and would appreciate it or not.

And for the federal government to vastly diminish in size and in _power_? Fabulous.

Kudos to Jazz for posting such a thought-provoking piece.

If one wishes to encourage greater savings, less debt, more family, and less excess consumerism, there are likely better ways to get there. It's also worth noting that it will be more difficult to invest government money to get out of the Depression (though only WWII really did it anyway) since our government already has a huge debt.

Why? Our economy is based on leverage. We borrow, even if we individually live within our means. Companies need capital and they only get from investors. But they also need loans from people willing to see through the risk. Without credit there is no money floating through the system. And without money floating through employers cease to function.

The sanctimoniousness of frugality on the individual scale does no good on the national scale. We don't make anything anymore. In an economic collapse frugality is guaranteed – for survival. We've been a consumer economy for a very long time. If China stops bankrolling our habits we will be in big trouble.

Times were difficult for the family- her father (my grandfather) was an attorney and often found himself representing people who could not pay. So he worked, but didn't have much money. My Mom is always telling me how I throw money away, which I don't think I do…. but I know I'm not the spendthrift she is.

But then I look at people younger than I and often think how THEY throw money away. So JSpencer is right when he says it has taken us decades to get to this place. The lessons of financial responsibility (and planning for the future as though we may not always have money) seem lost with each successive generation after the depression.

Did you choose this path? If you weren't forced into it by long term unemployment which is what would happen to many in the chaos some here seem so willing to see happen it just isn't the same. The two bear little resemblance to one another. I'm just amazed and appalled by the willingness of some here to just shrug off the idea of even more of their fellow Americans being homeless and poverty stricken in pursuit of some idealistic view of the past. Unless you can come up with a better way to achieve your goals I would suggest that an increase in empathy levels are called for.

It's not as comfy as amassing good credit ratings. You don't get the flashy car you want right away. That nice leather coat will have to wait until next year. Some repairs, you learn to do yourself instead of charge them to a handyman. Sometimes, you have to make hard choices and give up things you like (to take up again when you can).

People will suffer, I agree. For a time, I did. Being financially strapped isn't that grand. Families will lose their homes. Some families won't have as much money for food. Belts will be tightened.

But… American society as a whole can and will change in the face of it. Families might move in together after being apart for a while. Maybe they'll cook at home more often to save money. Kids will have to use their imagination instead of instant gratification. Those aren't bad requirements to have in life again.

But if the US stock market bottoms out won't some of those central banks (China, I'm looking at you) who are sitting on enormous amounts of cash just rush in and pick up bargains left and right.

Isn't that what Japan did when the US economy tanked in the early eighties, go on a Manhattan shopping spree?

And wouldn't that influx of cash free up the credit markets?

I must be missing something here, can somebody help me out?

Barak Obama was a senator from nowhere. He arose on the national scene and lies and scandal have hounded him from the moment he arrived. It has only been thru a massive effort by riled supporters that fear the reaper that have kept him propped up and away from life support.

Sarah Palin was a small town mayor who became governor of a large state with a rather small population. Her world was not about Foreign policy and international events. They were about the lives and dreams of the people of her state.

Yet we have lied and called her a liar. We have called her every name in the book. We have smeared her name, smeared her ability and smeared her viability. All in the name of the Truth. The truth is “she is unfit or unqualified to lead”.

Is this really the truth. Or is it Lies perpetuated by liars in order to Win at all costs.

That is the internet. The mark of the beast is upon this planet. 666. Bits and bytes formed together in a great DNA social experiment that will end in the destruction of this world. Yes I do believe this.

The beast is not coming. It has arrived.

Thank you for your time.