US BILL thread

[Mokong]

Jesus, it's like a bloody yo-yo.

 

Did you see the massive fall after the bail out plan was voted out?

 

Trillions were wiped off the american stock markets, insane, (oddly enforcing the fact it would have been better to spend the 700 billion, it would have cost them less)

 

And now talks of a new "bail out plan" and stocks are going up again.... though i don't think they'll make back what they lost yesterday.

 

Irish government here also said they would gaurantee deposits in the countries main banks. My bank was on the list, phew that god for that.

 

Man, I'll never get economics. I find the concepts of money and value to be complicated.

 

I think it works something like this.

 

When the first banks started "safe guarding" money for people, they noticed people would only use a certain percentage of the money they put in, in a certain time frame.

 

eg: I put in 1000 euro each month, but I will only spend 10% each month and save the rest. That leave 900 euro in my account sitting there.

 

This is the money banks use for loans/mortages, they take your cash and give it to other people on the basis that those people will pay it back over a set period and pay interest on it.

 

So assume someone borrowed that 900 of mine, and payed it back, the bank now have my 900 back plus they made interest on it.

 

Now assume if I was the banks only account, I come in before they have been paid back or because the person they loaned it to can no longer repay all the 900 euro they loaned out and want to withdraw that 900 euro. They don't have it anymore, but it's my money so they have to give it to me. They go to another bank take out a loan to pay me and unless they can find someway to payback their own loan they will go bust.

 

Does that make sense?

Better question... Is that how it works? I vaugley remember being thought something like that in school many years ago

[Haden]

Compare him to Obama in the recent Presidential debate - when does Obama look at the camera to address America, when does Obama extend a hand to McCain, when does Obama try to look McCain in the eye? All the time.

 

McCain stands there stoic as ever, looking at either the host or down, all the time, in a disrespectful way, and definitely disrespectful to Obama, and the man is old, and no doubt has much ingrained racism (he's pretty infamous for the number of times he said gook) and he clearly thinks Obama is a joke candidate and doesn't feel he needs to look him in the eye.

 

Going to war and getting captured doesn't make you a hero. I have absolutely no doubt that the experience was fucking terrible, but that has absolutely no sway on whether it makes him an intelligent man to rule the country. Rambo is ten times the all American hero, but is he a good man to run the country? Wait, actually yes, he probably would be, but fuck that

 

Yeh that waas wierd that he didnt look at him. But its completley off the point youve just gone into a monologue against Mcain propoganda I didnt say he was a hero although he probably was I just said he wasnt a coward cause of his actions in vietnam.

 

Holy crap, you played the POW card? I thought only McCain and his staff did that!

 

What are you talking about? I literally dont know what you mean by the card. Again using it as a card would be me saying vote mcain cause hes a POW. I am not saying vote mccain im just saying hes not a coward cause of what happened in vietnam. Its really wierd how if you say one thing positive about someone disliked you get jumped on.

 

Anyway this is off the topic of the insightful economic debate that should be happening!

[Rummy]

I think it works something like this.

 

When the first banks started "safe guarding" money for people, they noticed people would only use a certain percentage of the money they put in, in a certain time frame.

 

eg: I put in 1000 euro each month, but I will only spend 10% each month and save the rest. That leave 900 euro in my account sitting there.

 

This is the money banks use for loans/mortages, they take your cash and give it to other people on the basis that those people will pay it back over a set period and pay interest on it.

 

So assume someone borrowed that 900 of mine, and payed it back, the bank now have my 900 back plus they made interest on it.

 

Now assume if I was the banks only account, I come in before they have been paid back or because the person they loaned it to can no longer repay all the 900 euro they loaned out and want to withdraw that 900 euro. They don't have it anymore, but it's my money so they have to give it to me. They go to another bank take out a loan to pay me and unless they can find someway to payback their own loan they will go bust.

 

Does that make sense?

Better question... Is that how it works? I vaugley remember being thought something like that in school many years ago

 

I think that's how it works, I always try to explain it to people then fail. Basically, I could open a bank, Person A gives me £10 cos I say I'll give them £1 for every year I keep it for them. Person B comes along and asks to borrow £10, I say ok and essentially write an IOU, but they have to pay me £2 for every year they have it and I physically give them Person A's £10. Ideally, you do this but always have enough 'money' to go round that you can provide Person A should they come ask(in this scenario they can't, but that's cos it's only two people and so it's kind of hard). And as you said the banks go bust when people try, due to legal obligations.

And me, the bank? I make £1 profit in the whole process. Banks are out to make money, and that's what and how they do it essentially. Only, at some point, the fake money becomes pseudo-real money, and it's done with that, and again, and again, and more and more non-existant existant monies come to exist, leading to not alot of the world's money actually existing!!

 

(I think. Don't hold me to what I say as fact, I might be mistaken and don't consider myself all too qualified to talk about it beyond a flukey GCSE in Economics)

[Dannyboy-the-Dane]

I get the concept and I understand how money works. Maybe "complicated" isn't the right word ... It's more like - How can we run out of something we create ourselves? The money has value, but we assign the money that value based on how much we've got of it. Like with everything else. And thus we create the idea of value ourselves. Then, we can run out of money and go bankrupt - so does that mean that our valuation of things is incorrect? As we create the idea of value ourselves, shouldn't we expect it to be generally balanced? I find it hard to grasp these abstract forces within the concept of value and money, and I may be completely, painfully, obviously wrong. If so, please try to enlighten me.

[weeyellowbloke]

Well I guess Bush has found something else for history to remember him by: The president that destroyed Capitalism.

 

I find this crisis hilarious in many ways. It's morbidly fascinating to watch the western world sink in it's greed fuelled mire. Meanwhile elsewhere China are busy throwing money about sending people up into space and hosting the Olympics. I also find the reasoning behind rejecting the Bill hilariously ridiculous. It seems many Republicans saw it as nationalisation of the banks, which is the slippery slope to the dreaded Communism. Also many of them want to do what the average American wants in order to keep a seat come the elections. Such is the weakness of Democracy, most politicians are only interested in short term quick fixes which will make them look good. You can forget anything unpopular which will have a long term benefit beyond the next election.