Thread: What caused the recession?

A combination of extending credit to lower income so they can enjoy the American dream of owning a house, and then raising the cost of gasoline until they could not make the house payments....

plenty of blame all around, but I blame the speculators that still cause an unwarranted rise in the cost of fuel. Oil based on current supply should be at 10 to 20 dollars a barrel.

Originally Posted by jeffegg2

extending credit to lower income so they can enjoy the American dream of owning a house, and then raising the cost of gasoline until they could not make the house payments....

Put like that it almost sounds like a conspiracy.
In the UK fuel has always been expensive, so to some extent we've been forced to make more efficient use of it.
In the West we've come to expect a high standard of living based on the high consumption of raw materials, energy and latterly cheap imported goods.
Other poorer countries which previously had a much lower standard of living are now catching up and supply is being outstripped by demand.

Originally Posted by HNSB

Now, I wonder if I am remembering things wrong, or has history been altered somehow... If the latter is true, then I wonder why? Is it a matter of if something is repeated enough it becomes true, or is there some kind of conspiracy going on, and if so, by whom?

HN, the question is too big to prompt anything but heat and very little light.

Has history been altered? Of course - by the same forces that shaped the events that happened, and then received the window dressing of choice.

To point to individual events can be instructive, it can also miss the forest for the trees. The economic cycles, and the lifecycles of hundreds of civilizations have repeated for millennia. We launch discussion along areas of interest, but whether that's the economics, the politics, or environmental cycles - the same plays work themselves out. Each country/civilization frames the plays according to their unique history. In the U.S., we repeat the Hamilton/Jefferson perspectives - in politics, economics, and social policy. 'Progressive' vs Individualism. But the same results happen. Power centralizes, over extends itself, screws with the currency to finance it's projection of power, decimates its youth in constant Orwellian warfare/welfare plays, and collapses from it's appetites over-reaching it's resources. 'Makes me grieve - watching the freedoms disappear so quickly. We seem to be rather frail creatures - unable to step outside the plays and actually change our (leopard) spots.

Originally Posted by pinklather

HN, the question is too big to prompt anything but heat and very little light.

Has history been altered? Of course - by the same forces that shaped the events that happened, and then received the window dressing of choice.

To point to individual events can be instructive, it can also miss the forest for the trees. The economic cycles, and the lifecycles of hundreds of civilizations have repeated for millennia. We launch discussion along areas of interest, but whether that's the economics, the politics, or environmental cycles - the same plays work themselves out. Each country/civilization frames the plays according to their unique history. In the U.S., we repeat the Hamilton/Jefferson perspectives - in politics, economics, and social policy. 'Progressive' vs Individualism. But the same results happen. Power centralizes, over extends itself, screws with the currency to finance it's projection of power, decimates its youth in constant Orwellian warfare/welfare plays, and collapses from it's appetites over-reaching it's resources. 'Makes me grieve - watching the freedoms disappear so quickly. We seem to be rather frail creatures - unable to step outside the plays and actually change our (leopard) spots.

Well said.

"We seem to be rather frail creatures - unable to step outside the plays and actually change our (leopard) spots." And, I agree human history has proven this to be true. Our delusion in regard to our "abilities" perpetuate the myth that humanity can overcome its limitations and inherent flaws if we just find the right humanist key to unlock the mystery.

Chris L

Originally Posted by Bruno

I still remember the exact moment when I realized that the dotcom bubble would collapse horribly. It was when I read a comic in a computer magazine. Nerd 1 got a phone call from the boss, said 'um... yes... ok...', hagns up the phone and says to nerd 2 'the boss just told me that from now on he wants us to start making a profit', to which nerd 2 said 'weird... we're a dotcom, right?'

At that very moment I realized that a) the dotcom business model was not sustainable and that b) the money of all the people who got rich came from the people who bought all the tech stock and expected a similar payout when they sold their shares. It was like watching a train wreck happening while the passengers were unaware of what was going to happen, sticking their fingers in their ears and singing 'lalalala I can't hear you'

And predictably, it happened. The economy recovered to some degree. But 9/11 triggered 2 wars which destabilized the global economy and sent fuel prices up in the air. Meanwhile the American lifestyle enabled the credit crunch to build up, and when that imploded, a good deal of financial backbone broke down and cause massive panick.

Imo, one of the reasons that the US is hit extra hard (apart from the obvious was spending) is that there is no decent health insurance, and no social safety net. So anyone who gets unlucky now is really going to fall on hard times, get homeless or a crappy job, and is lost to the economy.

Belgium seems to be doing ok for now, and hopefully it'll stay that way.

The Healthcare sector has been the only thing really propping up the economy in the US. In '06, Business Week wrote a piece pointing out that since '01, the Healthcare sector had provided 1.7 million jobs when the rest of the private sector created none... (What's Really Propping Up the Economy?)

While our healthcare system has problems, without it, we'd be in significantly worse trouble.

Believing the financial sector would regulate itself with all our best interests at heart was probably not a good start.....

Originally Posted by richmondesi

The Healthcare sector has been the only thing really propping up the economy in the US. In '06, Business Week wrote a piece pointing out that since '01, the Healthcare sector had provided 1.7 million jobs when the rest of the private sector created none... (What's Really Propping Up the Economy?)

While our healthcare system has problems, without it, we'd be in significantly worse trouble.

Since every other advanced country in the industrialized world has gov sponsored health care, if we in the USA did too, my guess is that the disposable income that our population would have would contribute to more prosperity here even considering the inevitable higher tax rates. I've always found it interesting that this country "can't afford" socialized medicine but it has no trouble affording two pointless wars and spending more on weaponry than the rest of the world combined. What was it Eisenhower said in his farewell address ?

Originally Posted by JimmyHAD

Since every other advanced country in the industrialized world has gov sponsored health care, if we in the USA did too, my guess is that the disposable income that our population would have would contribute to more prosperity here even considering the inevitable higher tax rates. I've always found it interesting that this country "can't afford" socialized medicine but it has no trouble affording two pointless wars and spending more on weaponry than the rest of the world combined. What was it Eisenhower said in his farewell address ?

I'm not sure what would happen either to our level of healthcare or our economy if we had government sponsored healthcare... There's just no way to know. But, what we can look at and clearly see is that we make up for nearly 50% (if not more) of the world's budget on military expenditures World Wide Military Expenditures. That seems to represent a serious perspective issue, IMHO.

To put it as simply and easily as possible, to find the root cause just look in the mirror. It's all about people acting unwisely, recklessly,stupidly,selfishly and not caring about who was taking over their government. Things have not changed it's just accelerating.

The 1.7 million people in health care have jobs, aye... shuffling paper back and forth. The people providing the care would still do so no matter which system you had. It's all the excess people who add nothing of value and yet need to be paid that are what makes healthcare so expensive in the US. That, and the huge salaries of the lawyers and the large profit margins and the insurance companies.

For the purpose of your economy, those 1.7 million are worthless if they don't produce anything tangible.