Capitalism has failed. Period

Cael

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On previous threads you have praised pre-colonial Africa as being without poverty. Do you think that the Irish worker on €16 an hour is better off, or worse off, than a peasant in the 1700s in an uncolonised part of Africa.
You would have make that comparison over a wide range of factors. Perhaps a peasant living in a mud hut with a pretty wife and some little kids living by a forrest stream or mountain side overlooking a beautiful valley, with enough vegatables in his garden and regular hunting trips with his comrades for game, might well consider his life better than someone in Dublin working for 16 euro a hour for some fat ugly gombeen, living in a bedsit, and not having a hope of a wife and children because he cant earn enough.
 


Cael

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crocked

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If you take the US as an example, it is not the government who control the money supply but rather the Federal Reserve which is pretty much a private institution. Also if you keep creating currency then you are devaluing the currency already existing, creating inflation.

This video is rather intersting in that regard;
Money As Debt
Pardon me for explaing what a boom is... :eek:

:mrgreen:
 

myksav

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Ah demon spit, not another Cael post trying to resurrect communism or socialism.

Why can't the original poster's name be visible on the Latest Discussion page?
 

CookieMonster

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Even if capitalsim has failed - it's still not a compelling reason to embrace socialist/commie nonsense.
 

toughbutfair

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stupid thread.

This is a bad recession and will last a while and there will be pain. However, as Warren Buffet noted the 20th century had two world wars and a great depression and at the end of it the average person still had 7 times the wealth (factoring in inflation) that they had at the start.

Capitalism brings wealth, even the people on the dole now would be considered reasonably well off by the standards of 1900. Capitalism brings progress.

Every other system has failed miserably. Capitalism has its bumps and its flaws but has proven the best way.
 

Thac0man

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An amazing over-reaction is one way to describe putting 60 billion euro of taxpayers money into NAMA...
And NAMA is the benchmark of whether world capitolism remains sucessful or fails? No. No it is not.

The Capitolist system, if it failed, would simply reboot. Not revert to some tried and failed method like Marxism. Who might suffer most if the Capitolist system failed? Ironically Marxist nations, who still rely on Capitolism to keep their own bankrupt Market-Marxism economies afloat, through remittance or direct trade from "Evil capitolist" countries.
 

Cathar

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stupid thread.

This is a bad recession and will last a while and there will be pain. However, as Warren Buffet noted the 20th century had two world wars and a great depression and at the end of it the average person still had 7 times the wealth (factoring in inflation) that they had at the start.

Capitalism brings wealth, even the people on the dole now would be considered reasonably well off by the standards of 1900. Capitalism brings progress.

Every other system has failed miserably. Capitalism has its bumps and its flaws but has proven the best way.
This is a depression we are entering into not a short term recession. Capitalism has consistently opposed the welfare state.
 

feargach

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toughbutfair

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Even if it is a depression (it isn't - we are still well off compared to the 1930s), that would be no evidence of capitalisms failure. ONly a depresson of a couple of generations (50 years) would show that capitalism cannot dig itself out from any depression.

The communist stuff is childish nonsense that the poor, the stupid and the lazy often call for.
 

feargach

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Even if it is a depression (it isn't - we are still well off compared to the 1930s), that would be no evidence of capitalisms failure. ONly a depresson of a couple of generations (50 years) would show that capitalism cannot dig itself out from any depression.

Capitalism cannot dig itself out from any depression.

There was a depression in the 1930s and it was ended by state socialist means, all over the developed world.

We already know that capitalism is unable to extract itself from a depression, (that is, by capitalist, non-statist free-market policies) because no nation has ever exited from a depression without state-driven (external state aid in the case of western europe under theMarshall plan) non-market centralised plans.

Think I'm wrong? Example please.
 

toughbutfair

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I agree

We do need state leadership to help get us out. I was referring to the commie nonsense. Capitalist governments like the USA will engage in massive state spending to kick start the process. I don't view government and capitalism as mutually exclusive.
 

20000miles

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Capitalism cannot dig itself out from any depression.
http://www.politics.ie/economy/59996-case-against-fiscal-stimulus-1920-21-recession.html

http://www.politics.ie/economy/41009-case-against-fiscal-stimulus-post-wwi-recession.html

1920. GDP collapses 25%. Prices collapse 20%. Government continues to slash spending, engages in "courageous deflation". Wages fall and investments are liquidated, recession ends in about one year.

But perhaps this was not a "depression" but just a "recession". Perhaps. But you can bet your bottom dollar had there been massive State socialist central plan we'd be discussing the horrors of the 1920s depression.
 

youngdan

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Socialism has failed. Period

Socialism has failed. Period




The socialist system is in the throes of the worst financial crisis since the Great Depression. This is the view of practically everyone with half a brain.

“I like thieves. Some of my best friends are thieves. Why, just last week we had the president of the bank over for dinner.” W.C. Fields



The hurricane sweeping the credit markets, stock markets and banking system was a consequence of all the contradiction that had built up in the foundations of socialism over the previous 90 years. This is no temporary economic blip, but the precursor of an impending world slump. The storm is far from over, despite the announcement of an unprecedented bail-out by the American Treasury, the Federal Reserve and the Washington establishment.

As the popular children’s rhyme goes:
Humpty Dumpty sat on a wall
Humpty Dumpty had a great fall
All the King’s horses and all the King’s men
Could not put Humpty together again.

The King’s men at the Fed rushed to put the credit system together again, in the biggest bail-out in the history of world socialism. But as with Humpty Dumpty, the fragmentation caused by the financial crisis will be difficult to put back together, and the crisis will reverberate throughout the world in the coming months and longer.

This is how I described the events :

“Financial market conditions have now descended to the lowest point since the banking shutdown of 1932. In one 96-hour period, we saw three nearly unimaginable events. Lehman Brothers, America’s fourth-largest securities firm, filed for bankruptcy. Merrill Lynch, the best-known firm, was forced overnight to sell itself to Bank of America. And market pressurised forced the Federal Reserve into a huge $85bn takeover of AIG, our largest insurer, to avert its bankruptcy.” Added to this is the nationalisation of Freddie Mac and Fannie Mae, the US giant mortgage companies. “We will be climbing out of this financial hole for a long time to come.”

The SOCIALIST guru, Alan Greenspan, the former chairman of the Federal Reserve, came to London in 2002 to pick up his knighthood as ‘The Man Who Saved the World’. His handling of the internet bubble was seen as miraculous, especially by his biggest fan, Gordon Brown, the then British Chancellor.

While he was here, Greenspan paid a visit to the Bank of England’s monetary policy committee. In typical upbeat fashion, he told them that the US economy was resilient following the bursting of the internet bubble. Shares had halved in value and there had been bond defaults, but no big bank had collapsed. The reason? Well according to ME the taxpayer will bail them out

Greenspan’s “economic stability” was achieved by poisoning the socialist system by the injection of billions of dollars fictitious capital to use Marx’s words, are part and parcel of the modern socialist casino. As with all forms of credit, they can propel a ponzi scheme beyond its limits. However, in times of retrenchment, they provide a toxic mix. For every bank that announced huge profits on bailed out derivatives, there must eventually be losses elsewhere.

For instance, the collapse of AIG had come about by the insurance giant’s ledger of $60bn worth of derivatives written on other derivatives based upon bad mortgages.

Greenspan had not solved the crisis, but simply postponed it with an extra large dose of fictitious capital pumped into the system. The inevitable consequence would be a future crisis of much deeper proportions. This is what is happening today before our very eyes.

AIG, the collapsed insurance conglomerate, had been up to its neck in writing credit default swaps, which were a form of derivative allowing one financial institution to pass on the risk of a bond defaulting on to another. It sold them to banks wanting to protect themselves against defaults from sub-prime mortgages.

Few people outside or inside the financial industry ever understood how the new complex derivatives work. Teams of financial whiz-kids at AIG could not calculate how much their credit-default swaps were actually worth, with estimates varying between $20bn to $85bn!

The notional value of these derivatives in global markets rose to $60,000bn at the end of last year from $15,000bn in 2005. Such staggering figures are eye-watering. They inject colossal instability into the socialist system, with dire consequences. Everything is fine as long as the merry-go-round keeps going. Like the children’s game, pass the parcel, everything is great – until the music stops!

Another type of derivatives is ‘over-the-counter derivatives’, which should be outlawed.

The socialists were never interested in making money through production, the only real source of wealth, but through taxing and printing. This shows how degenerate the socialist class has become. It has become totally parasitic in its epoch of senile decay.

But they were not concerned with the consequences. They were printing billions and billions. They were unconcerned with the contradictions they were piling up, with bubbles in property, credit, shares, derivatives and other assets. They were on a merry-go-round of ever-spiralling wealth. All they demanded was an expanding asset base and no regulation that would hinder their exploits. In this carnival of money-printing, the banks lent vast sums of money as if there was no tomorrow. They were allowed to vastly over extend their loans to the tune of 30 to 1, especially in the property market. But boom turned inevitably to bust, threatening to bring down all in its wake.

Although this behaviour of the banks goes far beyond all such activities, it is not unique. In a book published in 1974, called ‘The Bankers’ by Martin Mayer, the author criticised the banks for over-extending themselves. “There are billions of dollars in potentially lost loans in the system; we are coming closer and closer to an explosion. The present banking structure can collapse. And the more the regulatory apparatus allows it to grow, the more catastrophic the collapse will be.” What a familiar ring!

But inherent in any socialist boom is endemic graft. The banks, as with the rest of finance capital, were eager to seek out lucrative speculative investments, including in property. For them, house prices could never fall, so they engaged in reckless lending to people who had little hope of paying it back. The sub-prime mortgage crisis was maturing. They were all caught up in this speculative syndrome. House prices went up as people were buying them. People bought them as prices were going up. It was a typical bubble. Credit allowed the ponzi scheme to go beyond its limits. Today, credit plays a far more important role than in 1929.

Now, the sense of panic was very real in the echelons of world socialism. “We are now, unquestionably, in the worst financial crisis since 1929. We do not know how many more banks and institutions will fail – Washington Mutual, the US counterpart of HBOS, is under severe pressure – but Bear Stearns, Fannie Mae and Freddie Mac, Lehman and AIG are plenty.” (FT, 19/9/08)

Emma Jacobs in the ‘Financial Times’ interestingly noted how times had changed: “Just a few weeks ago everyone told me spiralling inflation, surging oil prices and strikes meant I was reliving the 1970s. Now it is the 1930s.”

The FT editorial (19/9/08) was desperate for the central banks and government to intervene to save the capitalist system: “This is not a time for niceties… Today is about survival.”

They were forced to realise that socialism had failed. This was not a failure, as some apologists say, a failure of regulation, but of the system itself. The market economy could not restore the equilibrium needed obviously when trillions were being printed out of thin air. The banks and credit institutions were paralysed, like rabbits caught in headlights. Boom has turned to bust.

However, as these paper prices are written-off, there will be a knock-on effect to the rest of the economy. The example of Japan is a case in point. The Japanese banks bought huge swathes of property in the bubble of the 1980s. When the bubble collapsed, the banks were saddled with enormous bad debts. This resulted in a recession in the world’s second largest economy that lasted more than a decade. The ruling class is terrified that that could be repeated in the United States and the rest of the world.

The present crisis is a damning indictment of state intervention. Those who preached the virtues of the free market were vindicated as the state instead of letting them fail, instead socialised the losses on to the taxpayer. . They had no money for welfare or health, but when needed, they had plenty of money to bail-out Wall Street because they printed it up. “It [the US government] has begun a programme of economic interventionism more typical of socialist governments in moments of utopian zeal”, commented an article in the FT. It is certainly the most extensive peacetime of government intervention in the economy since the Great Depression, which shows how dangerous the crisis has become for socialism.



The proposed bail-out by the US government is said to be around 700bn to begin with. They are talking about buying bad debt in order to remove them from the company’s books. Something similar was done in the Savings and Loans crisis of two decades ago. However, this time, the sums are truly staggering, which will have to be picked up by the American tax payer. The plan is to create a ‘bad bank’ to take possession of all the toxic assets in the financial system. However, placing in effect bad debts in a deep freeze, will leave a massive burden over the US economy for years to come. In reality, the US government head by George Bush is promising to nationalise all the bad debts.

The failed policy of individual fire-fighting of failed companies has given way to “a comprehensive approach to relieving the stresses on our financial institutions and markets”, to quote Paulson. But what happens if this fails too? The contradictions are immense. The chaos in the financial sector is spilling over into the other sectors of the economy. The Detroit-based car industry, for instance, has itself lobbied the government for $25bn in loans and loan guarantees to allow it to function. The construction industry is already in a slump. In America and elsewhere unemployment has jumped. We are at the beginning of a new world recession which can be far deeper than anything we have witnessed in the post-war period. It is this that terrifies the strategists of capital. A new slump will mean drastic cuts in living standards and political turmoil worldwide.

As one senior Wall Street banker commented: “The crisis is far from over, the government action will buy banks some time but they will have to act decisively otherwise they will find themselves in an even worse situation in a few months’ time.” This is correct as throwing billions of dollars at the credit markets will not resolve the underlying problems. In fact, it was the excess credit that fuelled the artificial boom and all the excesses that have accompanied it – giving rise to the present crisis, the greatest credit bubble in history.

People are having to rethink their views about socialism. There has been a shift in the public mood everywhere, a realisation that something big has gone wrong. There is anger with the bankers. There is a growing questioning. As one newspaper commented: “Social historians will record this week as one when unhappy shoppers began discussing the potential collapse of western socialism in the same breath as butter prices.”

In a Waitrose supermarket car park in Harborne, Birmingham, Kate Organ, 53, a freelance arts manager, described her mood as “wretched and disempowered”. She expected here income, currently at £30,000 a year, to dwindle. She said: “When I was at University, the Workers’ Revolutionary Party harangued me that socialism would collapse. Now I know what they were on about. I expect the country will soon resemble Zimbabwee"

Socialism has failed. Period
 

Clanrickard

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The SOCIALIST guru, Alan Greenspan
That little factoid ended my interest in any further reading and I dare say normal people will agree.
 

setanta

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It's that time of day when Young Dan's medication has worn off.
 

hopi watcher

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http://www.politics.ie/economy/59996-case-against-fiscal-stimulus-1920-21-recession.html

http://www.politics.ie/economy/41009-case-against-fiscal-stimulus-post-wwi-recession.html

1920. GDP collapses 25%. Prices collapse 20%. Government continues to slash spending, engages in "courageous deflation". Wages fall and investments are liquidated, recession ends in about one year.

But perhaps this was not a "depression" but just a "recession". Perhaps. But you can bet your bottom dollar had there been massive State socialist central plan we'd be discussing the horrors of the 1920s depression.
You are joking of course. At every hands turn the govenrments all over the world are reaching for socialists solutions. Even Mary Harney is having to nationalise the distribution of medicines. The neo-liberal experiment has been tried and has failed miserably. Greed fills the vacuum created by light touch regualtion. Get over it.
 

youngdan

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That little factoid ended my interest in any further reading and I dare say normal people will agree.
Once again the doopy fool surfaces to make himself look stupid.

He clearly does not know that a central bank is pivotal as laid out by Marx
 

hopi watcher

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It's that time of day when Young Dan's medication has worn off.
He tells us he lives in the US, so maybe that explains it, given the lack of healthcare there.
 


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