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Why the US is in an invisible Depression

Discussion in 'Preparedness & Survival' started by ATCclears, Jul 23, 2012.

  1. ATCclears

    ATCclears Seattle area, WA Well-Known Member

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    Video - Why the U.S. Is in an Invisible Depression - WSJ.com

    The video states that 1 in 7 are on food stamps. I haven't confirmed that is true, but it seems plausible.

    I do believe that the politicians (regardless of party) don't want their name associated with the dirty 'D' word (Depression).

    I also believe that we're not coming out of this anytime soon (if ever). The needed fundamentals for job creation are simply gone. The US will continue, but as a two-tiered society with 50% (or more) in poverty.

    Peter
     
  2. ZigZagZeke

    ZigZagZeke Eugene Silver Supporter Silver Supporter 2015 Volunteer

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    My old philosophy professor, a libertarian, used to remind us that we cannot survive by doing each other's laundry. In realistic terms, that is what a "service" economy is. In order to fuel an economy, someone somewhere has to take something out of the ground, make it into a product that didn't previously exist, and sell it at a profit. Selling information to each other doesn't qualify. Making furniture out of trees, or making cars out of iron ore, aluminum ore, and plastic does. How much of the latter is America doing these days? Almost none. That's why there are no livable wage jobs for high school graduates.

    The Right is fond of saying that small business is our greatest job creator, but small business typically doesn't manufacture things. Small businesses typically sell services. Such businesses typically offer less than full time jobs, paying minimum wage, with no benefits and no future.

    A service based economy can exist only upon the foundation provided by manufacturing businesses. The US has no such manufacturing foundation any more. All that went to China, India, and Mexico long ago. The dollar has been devalued in relation to actual commodities (inflation) to the point where we are becoming cost competitive in the labor market with Japan. Things won't turn around employment-wise until we're cost competitive with China, India, and Mexico where the bulk of manufacturing is going on now. What does that future look like for American manufacturing workers? Take a look at lifestyles in those three countries.

    This is where unregulated capitalism always takes us, and we never learn the lesson.
     
  3. ATCclears

    ATCclears Seattle area, WA Well-Known Member

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  4. Trailboss

    Trailboss Vancouver, WA Well-Known Member

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    This is spot on and very true.

    Quite disagree with this statement however. I've seen thousands of small business that manufacture things. I've seen everything from screw manufacturers to carbon fiber washers to nuclear reactor panels. Excellent paying jobs with full benefits in small companies employing 30 or less employees. They make up a majority of good jobs in the USA.

    How many previous times in history has a Free Republic existed for more than 200 years and practiced Capitalism? Oh, that would be zero. So making a statement to the effect that "...we never learn the lesson." doesn't make any sense. If you just hate capitalism it's ok to just say that. You don't need to make justifying statement.
     
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  5. locobob

    locobob Beaverton, Oregon Well-Known Member

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    I didn't see anyone say they hated capitalism, why do so many people make that huge leap these days? Even Adam Smith saw the limits and need for regulation of market based economies. The market mechanism needs to be directed so that it is valued goods and services that reap rewards - otherwise we end up with massive fraud and ponzi schemes like we are seeing now.
     
  6. greycobra_03

    greycobra_03 Medford Member

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    The answer to the downfalls of capitalism (as most people would define it) is not to put gangsters (government) in charge of "regulating" it. Crony government deals compound capitalist greed and use violence to force monopolies. Most of the "evil" companies get most of their market advantage from government regulation. Take GM, receiving $20 billion of our tax money used exclusively to move their plants to Brazil and China.

    Capitalism isn't perfect, but violence and force is not the answer.
     
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  7. Grunwald

    Grunwald Out of that nut job colony of Seattle, WA Well-Known Member

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    There is no need to regulate markets. Enforcing contracts is enough.
    The reason we are in this mess has to do with massive fraud, plain and simple.
    The fraud of government spending more than it is willing to tax.
    The fraud of the Federal Reserve creating fake money.
    The fraud of Wall Street and banks cheating (and getting away with it because they have paid off those in government).
    The commited by thousands or maybe even millions of those who are on public assistance because they know how to work the system.
    And last but not least, the shift away from tariffs to fund the treasury. It is in large part what allowed the manufacturing to go to other nations.
     
  8. unionguy

    unionguy Portland Active Member

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    Adam Smith contemplated a level of obligation to the society's general welfare and the other market actors (including labor) that today's corporation's find unfathomable and would likely call him a socialist. Smith didn't necessarily believe in 'regulations', he just assumed such obligations would exist. Our patriotic forefather's also feared the power that corporations could amass and would simply be flabbergasted at the power and wealth they control today.


     
  9. dmancornell

    dmancornell Portland, OR New Member

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    You're right, he was a socialist. The fact that he promoted a few basic (and often self-evident) economic concepts such as division of labor doesn't make him a capitalist, no more than owning a hunting rifle makes one a 2A supporter.

    There is plenty of criticism of his works from a capitalist viewpoint over the past three centuries. You can roll that criticism in with the general critique of the proto-socialist philosophies that were quite popular in Adam Smith's time. As I recall, the term "general welfare" was invented then and was immediately used by states to justify theft and murder in return for political support.
     
  10. PlayboyPenguin

    PlayboyPenguin Pacific Northwest Well-Known Member 2016 Volunteer

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    What makes me really sad is when you watch the news and you see corporate giants admitting they are sitting on capital and waiting until after the election to use it. That is playing politics with the American citizens well being. It is too easy these days for the rich to say "I am not playing until I make sure I am getting my way" while every one else suffers.
     
  11. billstaf

    billstaf Portland, Oregon Active Member

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    Everybody is blaming Obama, poor people, or socialism, or the boogey man for the current financial woes in this country. You might want to look a little closer than that.

    The American people decided that they could afford homes that were way outside any realistic debt to asset ratio or their ability to pay for. The financial institutions took the money and ran. The government made sure the moneymen got away with it. The housing market goes bust and a lot of people downstream become instantly unemployed.

    The American people decided some time ago that they weren't willing to pay for products made in America, so American manufacturing companies moved off-shore. Now we all buy crap from China, and American manufacturing jobs are most likely gone for good.

    Bush didn't do this and neither has Obama. We all did it to ourselves. If you aren't willing to pay an American worker to pick your fruit, build your TV set, or put together your new car, then quit playing the blame game. the fault for this mess is looking back at you in the mirror.
     
  12. Burt Gummer

    Burt Gummer Portland Completely Out of Ammo

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    The truth is we are a bankrupt, DEAD economy and have been that way for years now. Banksters are just moving funds back and forth in their ponzi schemes in order to give the impression of life. The only reason 50% of the population is not sitting in line at a soup kitchen or Fema is money printing out of thin air. No country has ever survived the printing press hail Mary pass and we will not either.


    http://theeconomiccollapseblog.com/...at-the-economic-collapse-is-already-happening
     
  13. AMProducts

    AMProducts Maple Valley, WA Jerk, Ammo Manufacturer Silver Supporter

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    To address the OP's original thought/question... I don't believe we are in a depression in the clearest sense, we do have growth in GDP (which is definitional of what a depression is). This does not mean we are in clear sailing economic times either. What we are currently experiencing is that malaise of "stag-flation" interestingly, I was watching a movie a while ago from the late 70's/early 80's and the character was watching the news, and even back then they were using terms like "the great recession". These kinds of economic conditions are brought on when you have an excessive increase in the money supply, yet you have economic stagnation.

    Blaming capitalism is deeply flawed in this context, because what is happening right now is not capitalism except in the same sense as the capitalism practiced by China. We are in a de-facto command economy right now, and as it turns out, when you have a market system and then try to impose those kinds of controls on it, it becomes incredibly destabilizing and huge vacillations in the market can occur in very short amounts of time.

    Two things need to happen for the economy to improve, first, the state needs to stop passing more and more regulations, and give business a chance to figure out exactly what regulations they have to deal with currently, and then government needs to radically curtail spending. I am a small business owner, and frankly, every time I find I have to deal with another BS regulation that's going to cost more money I have to sit back and wonder why in gods name I punish myself in this way. It would be a lot easier to just sit back on welfare some days. Oh yea, and I'm a manufacturer, I make stuff out of steel and aluminum, here in the US.
     
  14. ZigZagZeke

    ZigZagZeke Eugene Silver Supporter Silver Supporter 2015 Volunteer

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    I would not consider a manufacturing company with 30+ employees a "small business". Most of the small businesses in America are retail stores, service companies, or restaurants with less than 30 employees. The neighborhood 7-11 or the corner McDonald's fits my description accurately.

    The Robber Barons of the 1880s were industrialists who were unrestrained by anti-trust or labor laws:

    "... their "questionable practices" usually included setting the product at extremely low prices (and paying their workers very poorly in order to do so), buying out the competitors that couldn't keep up, and once there was no competition, they would hike prices far above the original level."

    Over the 200+ years America has existed there have been cycles of less and more regulation of business (capitalism). When the pendulum swings too far towards deregulation it rapidly becomes apparent that corporations and their owners/executives have little or no conscience, loyalty, or humanity.
     
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  15. ZigZagZeke

    ZigZagZeke Eugene Silver Supporter Silver Supporter 2015 Volunteer

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    Economic constipation?
     
  16. knuckle Head

    knuckle Head southeast Well-Known Member

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    Well a few points on other points that been made, IMO

    First a business is smart not to invest right now in anything that is not aquick payoff, everything is too volatile, plus if big "O" gets another term the regulations he has pushed throught the last 3.5 yrs will seem like a drop in a bucket. It is not something liquidable I would not invest in it, If I win the Power ball tonight I would invest in land, farms, energy reserves, grocery store and distribution warehouse

    Second, although the banksters are enslaving us, as the video shows and other things, the one problem with the guy in video is wants the government to borrow and invest, news flash people, you do not the goobernment investing your money or making decisions for you.

    Also, someone stated the people 8500 miles are not a threat, another news flash, there are bunch of them here and several attempts to do things that would make people heads spin have been successfully averted, and the reason they were successful is because the big house has kept its mouth shut.

    The banksters have driven us to the edge of the depression or into a silent depression that when people start hearing it talk will make the 30's and weimar seem a vacation in shang ra la
     
  17. AMProducts

    AMProducts Maple Valley, WA Jerk, Ammo Manufacturer Silver Supporter

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    Inflation comes when you have an excess of money chasing a deficiency of goods, what we have now is an excess of money that isn't doing anything. Deflation comes when you have a dearth of money chasing excess goods.

    If by "Banksters" you mean the government, then you are exactly right, if you mean the people who give me small business loans so i can buy motors, steel, screws, machine tools, and the like, then you're dead wrong. The only way you can become "enslaved" to a "bank" is if you make stupid decisions with money, which to a large extent, more than a few financial companies encourage you to do so. But still you cannot shirk personal responsibility for your own finances and blame it entirely on predatory lending. We still have what is mostly a market system, one where if someone offers you a product or service that is overpriced you can just walk away.

    I for one am a huge fan of businesses, both big and small. Most of the ammunition and gun companies I work with are <30 employees, many are less than 10, however I can't buy steel and motors made by people who have less than 30 employees, because it's nearly impossible to produce quality steel with that few people, you simply need economies of scale to produce certain types of goods.

    Based on the attitudes I'm seeing here, I think I realize why the government is so anti-business... here in the US our constitution starts out with "We the people" well, I don't see a lot of attitudes here that are conducive to a smaller government, most of you are espousing the same attitudes taken by the government in terms of punishing business. Perhaps before you start blaming big business, you should look in the mirror.
     
  18. Vantage

    Vantage Pacific Standard Time Active Member

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    I have to throw out the challenge flag on this so called depression or recession or whatever you want to call it.

    Before "The Crash" in 2008 the DOW was at 13,000 (+/-). And recently it went back over 13,000. So we're back to where we were before "things went bad".

    Aside from that... it's hard for me to believe all the so called suffering when about half of americans are using smart phones. Not cell phones... SMART phones. Smart phones which carry a data plan, plus your month minutes plan. How is it that we're in such a bad financial situation but yet 50% of our population can afford to have a smart phone? And that doesn't include iPads, and Kindle Fire's and all the other gadgets. Apple computers, which sells luxury items not necessary for survival, reports 3rd quarter profits of 8.8 billion and declared another dividend. Starbucks is also doing well in our "worst recession since The Great Depression".

    Then I see commercials like this one. And again I think... we're so bad off, but yet there's a market for fancy refrigerated food for animals? And yes, as a matter of fact I DO feed my kids dry food from a bag. Almost every morning for breakfast.

    Don't get me wrong.. I don't fault a business for being successful, I'm just saying that we can't be that bad off.

    Not only that, but we're a fat country. Our obesity rate is going through the roof. (Hmm.. wonder why health care is so expensive??) How can we be eating so much of we're all so broke? Everyone is out of work and we got no money, but we're still getting fatter?!! The article blames lack of exercise and poor nutrition, which I'm sure contributes, but I think we're just eating too much. There is no arguing it. I've never seen anyone go on Survivor and GAIN weight. Take a fat person, put them on an island with a bag of rice and they're going to lose weight. Period.

    There is work out there. I was unemployed. I took a job as a part time temp, working graveyard on the weekends. I'm a husband and a father of two and it DID NOT pay the bills. But I showed up early, ironed my uniform, had a positive attitude and EARNED my way to a full time position. Which I turned down because when I wasn't at work I was putting in resumes and applications at other places and I was offered something better. Meanwhile, my brother in laws brother has been unemployed for 3 years. I barely graduated high school and he has a college degree.

    I feel like part of our society is just a bunch of spoiled whiney kids complaining about what they don't have, when in reality... we have a lot.
     
  19. bnz43

    bnz43 eugene Active Member

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    4 things Profits before people,
    3 greed
    2 greed
    1 greed. or we can blame the poor that all ways worked in the past.
     
  20. bnz43

    bnz43 eugene Active Member

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    the money that it costs the people of the USA to bail out the banks is just plain disgusting! compared to welfare , They sould have failed, everyone is suffering but them! They are the cause of this growing catastrophe . Its a joke I would rather feed fat lazy stupid people, then give my money to the people that new they were breaking the system ! ooh my god were so done! Its true its like they sold cars to people with bad breaks, then took out life insurance policys on them ! ...... pure greed! sad thing is it will happen again, because we will let it .