February 17, 2008

HousingPANIC Quote of the Day


Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate. It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people”

- Treasury Secretary Andrew Mellon, 1933


(Where is our Mellon? Oh, wait, WE are our Mellon)

33 comments:

Anonymous said...

We can do this quick or we can drag this on for years

Anonymous said...

http://en.wikipedia.org/wiki/Great_Depression

Frank@Scottsdale-Sucks.com said...

I say raise rates, cut off credit, cut off entitlements, and let's get this thing over with and press the proverbial reset button.

Anonymous said...

Will never happen. Clearly the way of life from the era of that quote is the same way of life we live today. The only thing that is the same is the wishful thinking that we will purge excess and this high cost of living from our society. Even if we have corrections, our way way of life will always lead back to excess and repeating the same problems. Clearly this has not and will not change, and you can go on with wishfull thinking just like this guy did in 1933; but reality dictates.

Anonymous said...

That is the most logical approach - but they probably fear another depression so are trying to do the opposite by trying to prop things up instead of letting the market ride. This time though - things really are different. Companies have been trimming labor even in the good times. Now that it's bad and people are really fearful for their jobs, and people have already had recent experiences with losses in the stock market/401Ks - there will be little that can be done about lifting consumer confidence.

Anonymous said...

The choice is, have a deep, hard recession now, or have a hyperinflationary depression later. When the choice is pain now, or more pain later, politicians always choose more pain later.

Anonymous said...

I prefer the wisdom of Thornton Mellon:

First of all you’re going to have to grease the local politicians for the sudden zoning problems that always come up. Then there's the kickbacks to the carpenters, and if you plan on using any cement in this building I'm sure the teamsters would like to have a little chat with ya, and that'll cost ya. Oh and don't forget a little something for the building inspectors. Then there’s long term costs such as waste disposal. I don't know if you're familiar with who runs that business but I assure you it's not the boyscouts.

WINGS said...

If the dems get in we're going into galloping socialism/communism.

It's all or nothing for these people.

They want a standard of living no matter what.

Cut off the credit card/housing ATM funds and they'll turn to crime to get what they want.

In the end, they'll settle for three hots and a cot, courtesy of the US gov't.

We are f*cked!

Buzz Saw said...

Yep.

Anonymous said...

Frank-while your approach is akin to ripping the bandaid off the wound and its probably what should be done it will never happen-the politicians would be facing torches and pitchforks-no, they will deny deny deny right up to the point where reality bitch slaps the public and everyone is walking around in circles saying what happened.

Bleak said...

This is a natural purging process known as the business cycle. All of the excesses are purged and distortions in the economy corrected. Capital will move to its best uses/best returns.

Only problem, as usual, is government meddling, and individuals and business looking for bailouts from the public treasury.

Ed said...

Yeah good luck with that. In 1933 this was still a capitalist country. The strong survived the weak died off. Then every liberal's wet dream came along. He gave us social security, FHA, unemployment benefits. Yippe!!

Fast forward 70 years and where are we now? A socialist's paradise where people on welfare have iPods and cable TV, and yet still complain.

Today Obama and Hillary are falling over each other to give free shit to the masses.

Liquidate labor? Yeah right. Hillary/Obama will "create" jobs.

Liquidate real estate? yeah right. Hillary/Obama/Bush will come up with bailout after bailout.

You are all deluding yourselves if you think we get to press the reset button. The only thing that will rest will be the tax rate. Reset first to 2000 levels then to 1970s levels when Pres. Obama gets his way. Get ready for 70% marginal tax rates yet again.

Chuck said...

Ah yes! Let us be driven by some Calvinist ideology to cut off our noses to spite our faces. Who cares who gets hurt? The immoral high-livers will be punished. Damn the dead children and other innocents. Let us purge the evil from this life so we can reap the benefits of life everlasting.

bitterrenter said...

Mellon was just another of those callous, savage rich republicans who create messes like the one we're in today. Of course he favored drastic measures to punish the lower echelons of society. Fascist republicans always do. I still remember reagan telling us "thinks must get worse before they get better" as the middle class suffered through the recession he created and the wealthy were given huge tax breaks.

Instead of "liquidating" as Mellon said we should have "exterminated" the wealthy, taken their money and destroyed the capitalist system that created people like Mellon.

Republicans and conservatives are the scum of the earth.

Bitterrenter said...

Even after 30 years of conservative fiscal policy has created devastating bubbles, huge debt, crumbling infrastructure and social division, there's still many of you walking brainstems who try and blame democrats.

I hope McCain wins, the republicans take back Congress and we continue on this road. In a few years most of you stupid conservatives will be living in tents and selling your kids into porn to stay alive. Maybe then you'd see the light of your ignorance.

Anonymous said...

Nice Keith -- cite the worst treasury secretary in American history.

Bravo!

A great depression like purge of the speculative excess is going to be necessary, but the only way back out of that liquidity trap is New Deal-like social/economic policies. Mark my words, within 5 years we'll have universal single-payer health care, an isolationist trade policy, and we'll be spending tons of public money on trains, bridges, solar power, and other infrastructure.

Welcome to great depression part II, and New Deal part II.

Anonymous said...

eliminate medicare, medicaid, social security, and all of our other socialist programs. end the ponzi scheme set up to deal with the Great Depression before we get in deeper and cause the Great Depression times 10. We cannot grow our way out of this and, unlike the current crisis, we cannot leave foreigners holding the bag. They'll be smarter after this time.

cut income taxes (think George Washington and Co. would have stood for 35% marginal rates???). the productive should not have to subsidize the unproductive. subsidize something and you'll get more of it.

get money out of politics (not sure how) but gotta end the quid pro quo bribery out there.

end implicit government guarantees to bail out banks beyond the $100k FDIC limit for depositors. socialized banking leads to socialized losses and the government implicitly bearing trillions in losses.

all of the government programs set up to "prevent another Great Depression" are doing just the opposite. Before the 30s, economic downturns were short and shallow (panic of 1893, 1907, etc.) but after the government started getting involved, it got worse (Great Depression, 1929-1941, Stagflation, 1973-1982, stock market/housing crash 2001-?). I'd rather have a quick year-long downturn than decades-long downturns.

Anonymous said...

Today, 42% of all US employed is GOVERNMENT employment, and rising. Fire 75% of these non-producers of anything, and cut off ALL governmental pensions completely retroactively. You're FIRED, now go produce something in the private sector! Hell, the private sector no longer gets pensions, why should they fund the public sector; and why should those who sucked on the governments titie for 20 get them anyways?

Then raise rates to whatever lenders WILL loan to each other again. Real market rates, Perhaps 20%, save the dollar, fund free healthcare for every CITIZEN, put limits on what the AMA can charge, as in resonable, also eliminate healthcare insurance, just keep supplemental, like afl, and put the idiot responsible for upcoming depression up on impeachment proceedings monday which is befittingly, presidents day.

Most importantly, jail all republicans on sight. Have 'block roundup bounty parties'! It was them and theirs who wanted these crazy ones: greenscam and dumbya to loot us all to begin with.And Loot they did! Ignorance was no excuse. Round 'em up, alqueda style, and send them to gitmo, with no bibles, no thumpin' and no habeus corpus! They like it that way, I heard them say so on faux noise the other day! Make sure they get their chance to water board Too, I hear its a hellova sport! I learned that on faux noise too! ROTFLMAO, and remember, bottom line; never ever trust any of them as far as you can throw them. They are proven not trustworthy.

Now after all republican nutjobs are incarcerated, without attorney, give them their bibles, on special days, and let them sing their kumbayas until hearts content as that will keep them happy. oh, the humanity! It was a supply side republican whom got us into 1929, and another who just did that feat again, you just don't know it YET! Hope you all are buckled in for the upcoming main attraction: 'bush built scheitt sandwich' Part one!

Anonymous said...

I like everything except the part about working harder and moral lives. Why shouldn't the government be able to provide for me so Ican go screw and watch porn all day?

Anonymous said...

Credit is already being cut off. Just last year, my banks kept calling me to say they were raising my limit. Now they just slashed it down to the levels I had when I was in college. It doesn't matter to me because I'm not carrying a balance.

Anonymous said...

Those in "poverty" in our country have plasma TV's, Medicare, Sony PS3's, HD cable TV with 999 channels, a Cadillac with $5,000 gold-plated rims, an iPhone, and are morbidly obese from feeding off the government teet. I have a graduate degree and I don't even have those things because the goobermint taxes the crap out of me. The poor sit at home watching Oprah and Jerry Springer all day while I work 60 hours a week.

The American middle class, especially the women, are morons. They watch their husbands slave away all week then vote for the thugs in Washington who steal his earnings.

If the poor in America are in such bad shape, why do more poor people keeping coming here from Mestizo, Haiti, Middle East, Asia and Africa? They know the gravy train is still running on schedule. All aboard!!!

Anonymous said...

Screw free healthcare. I'm not going to fund $5,000 AIDS cocktails for heroin addicts and morons who don't use condoms. I'm not going to pay for surgery for some idiot rock climber, dirtbike daredevil, or skydiver. I'm not paying for the medical care for some waddling fat slob who stuffs his face with burgers and pizza and sugar all day. People need to pay for at least 50% of their healthcare so they will have an incentive to stay healthy. I eat very healthy and stay in shape, so why am I responsible for taking care of some slobbering pig who lives 2,000 miles away?

This sick juvenile MTV society wants all the freedoms and freebies without any of the responsibilities.

Anonymous said...

Today, 42% of all US employed is GOVERNMENT employment, and rising. Agree: Fire 75% of these non-producers of anything, and cut off ALL governmental pensions completely retroactively. You're FIRED, now go produce something in the private sector! Hell, the private sector no longer gets pensions, why should they fund the public sector; and why should those who sucked on the governments titie for 20 get them anyways?

CORRECT ! NO WAY THOSE GOVT. RETIREMENTS AND PROMISES CAN BE PAID! Must be cut back to Soc. Sec. levels!

We say will have to be Public Pension Bankrupcties declared across the country--from federal on down.


Smart Independent

FaceDown said...

I love it, Keith. You made that ridiculous pro-Obama post last week and now it appears that your blog has "jumped the shark". Take a look at the republican and democrat nonsense that has been spouted in this thread alone.

You opened the door and walked right through it.

Frank@Scottsdale-Sucks.com said...

"the productive should not have to subsidize the unproductive"

Ahh, but Obama says we have to, and he's going to enforce that with an iron fist ala the Soviet Union. Just wait and see.

In the end, the only people who support liberal policies and nutjobs like Obama are lazy-asses and unfortunately they now comprise the majority of Americans.

Bitterrenter said...

Pretty much all the anonymous posts from 7:00 pm to 9:08 pm were from the same ignorant savage. Even the one agreeing with themselves.

Pretty pathetic. You views of living in a civilized society are bad enough then you compound that with fake rants pretending to be a consensus.

We should keep abortion if for no other reason than to keep you from reproducing.

Anonymous said...

from the New York Times:
Make Big Profits Illegally (and Maybe Keep Them, Too)
By FLOYD NORRIS
Published: February 15, 2008
In a strange anomaly to American securities laws, it is not clear that someone who illegally obtained insider information has broken the law by trading on that information.

from slashdot.org:
"On Oct. 17, 2007, someone hacked into a computer system that had information on an earnings announcement to be made by IMS Health a few hours later. Minutes after the breach of computer security, Mr. Dorozhko invested $41,671 in put options that would expire worthless three days later unless IMS shares plunged before that. The next morning the share price did plunge, and Mr. Dorozhko made his money by selling the puts. 'Dorozhko's alleged "stealing and trading" or "hacking and trading" does not amount to a violation' of securities laws, Judge Naomi Reice Buchwald of United States District Court ruled last month. Although he may have broken laws by stealing the information, the judge concluded, 'Dorozhko did not breach any fiduciary or similar duty "in connection with" the purchase or sale of a security.' She ordered the S.E.C. to let him have his profits."

Anonymous said...

Frank@Scottsdale-Sucks.com said...
"the productive should not have to subsidize the unproductive"

Ahh, but Obama says we have to, and he's going to enforce that with an iron fist ala the Soviet Union. Just wait and see.

In the end, the only people who support liberal policies and nutjobs like Obama are lazy-asses and unfortunately they now comprise the majority of Americans.

February 17, 2008 9:56 PM

So Frank, what you do is productive?

tater said...

This economy is dying the slow death of a thousand cuts, but, it's dying. Oh yeah, it's dying fast.

Peter T said...

Yes, Mellon said that and what did it lead to? One of the biggest wins the opposition party has ever scored, leading to a long streak of actions opposite to that advice. Even if you don't take sides who had the better policy, it must be said that the quoted viewpoint has little chance of gaining a majority.

Anonymous said...

Jail all Republicans on sight.

I like that idea. Lets start with our Libertarian Chimp President.

www.DollarPANIC.blogspot.com said...

.
.
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FACEDOWN said,

I love it, Keith. You made that ridiculous pro-Obama post last week and now it appears that your blog has "jumped the shark". Take a look at the republican and democrat nonsense that has been spouted in this thread alone.

--------------------------

OMG, Facedown hit the nail on the head. This was my favorite blog for years, until that pro-Obama post that made me sick. That post seems to have chased away many of the great old time posters here, and replaced them with butt-f#@king extreme leftists.

With 42% of the workforce getting paid by the public and controlling public opionion via direct control over regulation of the media; WE HAVE A TYRANNY by the so called 'public servants'.

The system is therefore locked into a HYPER-INFLATIONARY CRACK-UP BOOM. Why? Because, the Gov't will be forced increase the volume of FIAT to pay the nominal pension claims. As gov't pensioneers are the 1st receivers of this new money, they will benefit the most as they out-bid the private sector for a diminishing pool of resources.

Why is the pool of resources diminishing? Because: (a) the volume of the workfore is going to drop as the baby-boomers retire, and (b) because of compounding effects of the net oil depletion rate.

For the average Gov't worker, that pension is not going to have the purchasing power that you expect; so it can be expected that you will whine and bitch about inflation destroying your benefits. You will think times are bad, and you will think that the system ripped you off. However, you will be much better off than the private secton (on average).

What Gov't retires should expect is that Year 2008 is going to be a baseline year for purchasing power of gov't pensions. Every year thereafter will post a decline in real purchaing power of these benefits.

What the Private Sector should expect is that anyone under 60 years old now, will most likely be economically forced to work til they drop. NO RETIREMENT EVER, any every year after 2008, you will see your lifestyle drop further and further.

20 years from now, you might be considered 'rich' if you are not living in a trash gov't housing project and working 100+ hrs/week just to eat and pay the Gov't the rent. YEA, you heard me right, with all the foreclosures eaten by the GSE's, they are not going to be put back on the market 'at fire-sale' prices like most renters on this blog are hoping for. The Gov't will set up a brand new GSE to take over these properties, and then rent them out. IT'S CALLED END-GAME. It's how they will control the masses. Equal Opprunity Housing will not apply to the Gov't GSE, who will be running whatever half-baked social engineering plan they dream up and force you to life!

Anonymous said...

http://www.slate.com/id/2184488/nav/tap3/

What is occuring in the market and want Mr. Mellon is refering to is "Price Discovery".

We need it fast in the housing market and all the other investment vehicles that are linked to RE. So far everything every market player and gov't has done has been to do the opposite which will only prolong the matter and keep us from recovering because we need to go through the process Mr. Mellon alludes to in order to get strong and back on our feet again economically!!