Yes, Greenspan's early influence was Ayn Rand, but, in his own words, he has since moved far away from her belief system. lemeeeplay, let me ask you a question: If the markets are imploding, everything is viewed as risky, and you're terrified of further carnage, are you going to lend your precious capital out at 2% or 12%? Following the dot-com bubble bursting, the Fed artificially (i.e., in an act not driven by the free market) lowered interest rates. Combine this fact with the implicit government guarantees and the CRA (http://en.wikipedia.org/wiki/Community_Reinvestment_Act), and what we end up with is an environment ripe for the exploitation by greedy commercial and investment banks. Now I'm not saying that this debacle was 100% the fault of the government/Fed. But, to use an analogy, the government/Fed was like an adult who handed gasoline, fireworks, and matches to a nine-year-old and said, "Have a great time because there will be no consequences for your actions!" You're arguing that the kid is to blame. Ayn Rand supporters are arguing that the kid (i.e., greedy bankers and speculators) was simply playing by the rules created--nay, encouraged--by the adult (i.e., government). What I find so ironic is that the Ayn Rand detractors argue that her policies would lead to booms and busts. These are natural parts of the business cycle! Attempting to manage these using artificial means creates larger booms and larger busts (heh, I said large busts). And the continued government intervention has another horrific consequence: a national debt that continues to grow out of control. I much prefer to debate this stuff over red wine and cigars, but I think you get my drift.
Not its not her fans wrecking havoc. True fans of her are people like Ron Paul. Not fools like Greenspan.
Alan Greenspan being influenced by Ayn Rand is kinda like knowing just enough karate to get your ass kicked. Ayn Rand would not have looked kindly on congress legislating how much leverage fannie and freddie could take on and providing an implicit government guarantee. She probably would have choked on the concept of allowing the federal reserve to arbitrarily set the price of money.
Uh no. Artificially low rates? Are you a Ron Paul supporter or something? Get rid of the Fed? The Fed has existed for almost 100 years, it's hard to blame the current crisis on them alone. They've "intervened" in the free market for a long time. Unless you're a Ron Paul groupie I don't really get your argument. As for "forcing people to lend mortgages" who do you think came up with that? Bush himself was proudly speaking about that, that it would create american jobs. The government and business are one. Get that through your head. They used government when it was convenient such as subprime, and they argued for lack of regulation when it was also convenient such as derivatives. You could write a swap and not have to put any capital aside in case of risk, how crazy is that? Why do you think the banks were undercapitalized and failed? And all these problems of low rates stem from the NEED to go in debt to support the economy, the economy was getting weaker as wages were not going up with profits, low rates were the only way to keep the economy going. It's called rationalization, read it up. Rationalization is making up ANYTHING to keep believing in something obviously false. When people debate whether Alan Greenspan did the right thing or not, or whether he knew the risks or not, or that the big bad mystical "government"(while forgetting who runs it) did this or that, then yes this country really does have a problem. Just like the oil bubble, STOP debating why we are in this problem. The debates will never end! The issues are easy, short term greedy international business companies took hold of the US government to get their way, and everyone else is getting screwed. Everything else is a side show circus.
Also if I'm a rich businessman I don't give a shit about ideologies. This is the Great Lie. That anyone high up in government or business is driven by ideologies. They're not, all that matters is money and power. You control the sheeple by saying stupid lies like being ideologically driven, but the leaders never are. They're extremely rational and pragmatic and goal oriented. The WSJ article isn't any better, it blames the current crisis on a "Whoops, we followed the wrong theory." BULLSHIT. The "theory" was the sales pitch. The role of propaganda as this thread proves is to make rational people irrational. A few weeks ago I was seeing some really good discussion going on in ET, people were getting it. Now all we have again is a bunch of monkeys who are as easily manipulated as the unemployed Ohio redneck.
Ayn wrote a book without any commitment to the story. She did not commit to the politics nor did she bear the burden of responsibility of owning a Corporation and writing from experience. She was a writer and the book is merely a story. The fact that more people lay a claim to her ideology speaks more of headless chickens than it does of direction. regards f9
You just put 200 or so words in my mouth that I did not say or write. I am a Ron Paul supporter, because he advocates fiscal discipline. I am not a "FED is the root of all evil" person. I do think the Fed can be managed solidly. I never indicated any political blame although you assumed that I never placed any blame at Bush's feet and that's simply wrong. Both sides were to blame, although let's be honest that the Dems have been pushing this "fairness in lending" crap which is code for "make loans to minorities regardless if they can pay it back or not. You keep rates at 2% for a decade and then wonder why there are bubbles. Laughable.
Like I said, the low rates were only a secondary effect of having few options to keep the economy going. Tell me, do you have complete freedom over your life? No, sometimes there are only a limited number of ways we can act. The low rates were used to encourage borrowing because the country was hemorrhaging jobs for over 20 years and not bringing anything back in. The trade and fiscal deficit. Just like anyone who has their income drop, the US got addicted to borrowing money, and they turned to the Fed for cheap credit. The cheap credit was a minor tiny inevitable policy of much bigger problems in the country today.
The whole job situation was the result of globalization directed and encouraged by our FEDERAL GOVT. If we ever get to true global equality (imho a stupid goal) we shall all be poor. No make that most of us will be poor. The people in charge will be the privileged wealthy. The leaders.They and their descendants and supporters will remain so until overthrown.
This is incorrect. If you watch her in any of her interviews she is a very committed advocate for free markets and the story was just a commercial way to spread her philosophy. Also incorrect that her forecast of a socialist world took 52 years to play out. In 1977, a blackout left some 9 million people in New York City in the dark. You can either be for some form of central control or a free market. To waste our treasure to bet that the politicians can 'manage' the economy better than price is going to be an expensive lesson. It always is. Much easier to address excess and criminals that occur in a capitalist state than to create an entire class of criminals who find it easier to steal wealth by passing more laws than to produce it. But hey, this will all play out in the next 8 years. Who believes they will be better at the end of Obama's reign than at the beginning?