Nutjob Ron Paul on this bailout mess

He has some good ideas.

And more from Ron Paul...as he points out, few congress critters understand the economy...most were trained in law and spend lots of their time on the next election. Congress has abdicated it's oversight. The Treasury/Fed are flying solo.

'At least 90% of the cause for the financial crisis can be laid at the doorstep of the Federal Reserve. It is the manipulation of credit, the money supply, and interest rates that caused the various bubbles to form. Congress added fuel to the fire by various programs and institutions like the Community Reinvestment Act, Fannie Mae and Freddie Mac, FDIC, and HUD mandates, which were all backed up by aggressive court rulings.

Except for a rare few, Members of Congress are unaware of Austrian Free Market economics. For the last 80 years, the legislative, judiciary and executive branches of our government have been totally influenced by Keynesian economics. If they had had any understanding of the Austrian economic explanation of the business cycle, they would have never permitted the dangerous bubbles that always lead to painful corrections.'

I don't agree with Ron Paul on everything, but the quote you provided is nothing but common sense. That is a rarity on Capitol Hill.

I don't agree with all of his political concepts but I think he, for the most part, right about the economy.

The US will not default. Our debt is in dollars. Might we have to monetize? Yes, but unless the Treasury agrees to sell non-dollar denominated bonds, we won't actually default. I completely agree with Colonel, and Paul's solutions are as equally unworkable in a booming economy as they are in a deteriorating one. The bottom line is that he is an Austrian purist. Minimizing government intervention/effects on economic transactions/decisions is great, but you can't eliminate the government altogether. There's a word for that, it's called anarchy.

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Paul's solutions are as equally unworkable in a booming economy as they are in a deteriorating one

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Which solutions? The ones where everyone pays their debt or the one where the government quits stealing our retirements & seling us down the drain to prop up failing institutions that will only fail & bring us all down with them? Since you are sucn a financil genius can you give us some examples of how this is unsound management?

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By what logic do you guarantee this stupid arse statement?

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See: debt denominated in dollars.

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Is it because we have so much debt we are quickly approaching the point where we will not even be able to pay the interest on our debt even at a one percent yield?

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No, its because our debt is denominated in dollars. Until that fact changes, the U.S. will not default. This is pretty simply economics man.

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Now I don't know what you consider default, but if you can't even pay the interest on your debt & you get a margin call as a nation & other countries want their own money back or gold in return for what you owe & you can't pay, therefore they refuse to send goods or commidities for trade any more, that is what I consider default.

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You really need to go look up what the significance is of having the dollar as the worldwide reserve currency and why that is important to a possible U.S. default.

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Which solutions? The ones where everyone pays their debt or the one where the government quits stealing our retirements & seling us down the drain to prop up failing institutions that will only fail & bring us all down with them?

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The ones where the government has 0 intervention and the country can collapse because of a financial mishap. If he had his way, there would be not Fed and no FDIC. That would not have prevented the current problems, but you can bet your arse it would be a hell of a lot worse if there wasn't something to prevent bank runs and insure bank deposits.

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Since you are sucn a financil genius can you give us some examples of how this is unsound management?

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I have no idea what this means. No one suggested that paying off personal debt was "unsound management," or that government bailouts are inherently good things. If you can slow your roll for a second and read my post, you will clearly see that I agree with his opinion on government bailouts (I've never met a person who thinks bailouts are good to begin with) The point about paying off debt is fricking common sense, if you needed Ron Paul to tell you that, you've got other issues.

He is too ideological. I don't want to give Citigroup a bailout, but the downside risk of letting them implode is much worse alternative. I'd rather pay for peoples' frickups rather than spiral into chaos, but that's just me.

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That's because of idiots like you who saw no need to address our debt while the economy was booming.

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You mean like some kind of oversight of the non-depository banking system/shadow banking system that created the bulk of the subprime and alt-a mortgages? Right?

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Instead we kept letting the banks leverage themselves beyond any means of protecting themselves

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So you're saying that we should have regulated those institutions better, and not allowed them to lever so far out of control, right?

Given Paul's stance on regulation (also known as government intervention), I would imagine he would disagree with you.

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The US will not default. Our debt is in dollars.

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Does this mean we would simply print our way out of it, thereby devaluing our currency to nil.

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Might we have to monetize?

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I don't know what this means. Is there a simple answer or a link to explain.

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Yes, but unless the Treasury agrees to sell non-dollar denominated bonds,

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What't to stop them? Seems to me anything is possible. Soc Sec, bankrupt. Medicare, bankrupt. Bears Stearns, dead. Niedermeyer, dead.

A small minority of a society being taxed to provide services for a large majority appears to where we're headed, if not already there.

My real interest here is: IF we're headed for defaults on treasuries, where should one place a percentage of one's assets?

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Although I am apparently a financial genius,

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simply a prerequisite to post on this Board.

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I don't think there is an answer to this.

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Neither did I. just thought I'd ask.

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The world is in an economic and monetary race to the bottom.

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I guess that pretty much sums it up.