As I have asked before, do you think linking me to my "industry" in any way makes me think that you're right? You constantly attempt to do this and for what purpose? It doesn't advance your argument at all.
Simply pointing out that you have a ton of motive to have a very biased opinion and in which direction that bias might sway your opinion. You have defended what have been, imho, indefensible positions/actions of the banking industry in the past. I also like pointing out the fact that in a lot of cases you either do or should know better. For example, your claim that the foreclosure issue was basically a non-issue and that banks depriving people of due process wasn't a big deal. I believe (could be wrong, correct me if I am) that you also implied the banks should not be punished for admitted illegal activities such as perjury.
We don't "need" them to buy our debt.
Leave out all of their "needs" and explain this one to me in detail please. Our revenue barely covered necessary expenditures this year. This is another reason I point out the fact that you are a banker, you should understand these numbers very easily. When our revenue only covers basically Social Security, Medicare/Medicaid, and interest payments how can you state that we don't "need" them to buy our debt. I have explained the way our debt is structured specifically to you as well and then throw in our current economic situation into your explanation please. Furthermore, they don't "need" to stop buying our bonds to severely hurt us they could simply stop buying them at their current price. Again, your field of expertise is relevant because you should know exactly what implications that can have and how quickly they will show up.
They *HAVE* to buy it as a function of them having a trade surplus with them. They sell us shit in dollars, those dollars must be invested into something, otherwise they would have to sell the dollars, dropping the dollar value, making their goods less attractive.
We are already significantly dropping the value of the dollar though. And why "must" those dollars be invested in US Government bonds?
They are circumventing the natural trading mechanism of balancing by buying the dollar assets *AND* pegging their currency to the dollar. They *HAVE* to do this in order to bootstrap their own economy into a consumerist one, propelling their poor into middle class to get exactly where we are now. They *HAVE* to do this, else they will forever be a poor economy.
Sounds like good reason as to why they aren't happy with us intentionally devaluing the dollar.
Yes, they *HAVE* to buy US debt. However, we don't *HAVE* to buy their trash.
I thought you just stated above that they have to buy our debt so that they can sell us their trash. If we don't buy their trash why would they still have to buy our debt?
I have mixed feelings on QE2. On one hand stability is needed and this might improve things. On the other, it's something that hasn't been used historically and the distortions in the market may not be worth it.
I have mixed feelings about certain tax credits. On one hand we can't afford it but on the other hand it puts money in my pocket.
This goes back to my first point. If you haven't seen already, my rationalization of some of the past 3 years is far more logical than you give me credit for. I don't pretend to accept everything "my" industry has done in the last 3 years, but it's done and we have to pick up the pieces.
I distinctly remember a conversation we had in which you said that you personally looked at some of the trash that was sold and almost immediately realized it was indeed trash. In the very same conversation you said you "understood" how the people who are supposed to be infinately better at evaluating that trash didn't figure it out. You will simply not get me to buy that the banking industry doesn't understand he law of exponents.
With that said, I will give you credit for speaking against some of the bullshit that they did. I also agree that what is done is done and we must move forward with fixing the problems. What we seem to disagree on is the how, especially some of the first steps. We have had proof of blatant fraud for a while but we even have sworn testimony now and yet somehow no one has even been indicted much less put in front of a jury. Hell, we haven't even taken back the gains from the illegal activity. Do you thin that allowing people to profit from illegal activity will cause people (or an industry) to be more or less likely to do it again?
I do not think the ramp up in all commodities can be attributed to QE2, as they have gone up relative to all major currencies, this alone indicates that it's not monetary but price inflation. If you look at the issues with crops right now there are a lot of headlines about how shitty crops are right now.
What about QE1 and yes there are other reasons that certain commodities are rising in costs but I am talking about the commodities market in general. I am sure you would agree that significant cost increases in raw goods will either increase the end price of the goods that use those commodities OR significantly reduce the profit of those who sell those goods, are either of those scenarios good for our economy and who do you think will be impacted the most?
One final question, correct me if I am wrong but the Feds main way of controlling inflation that might be caused by QE1&2 is by raising the interest rates, right? What effect do you think that would have on the economy in general and the Federal Governments budget?