Liberal shills

I see that the Liberal shills are hard at it as they cannot debate the subject, they attack the messenger. Here lies the problem with the economy - the shills ran the show.

Example: - Gordo and his brother (I mention his brother because he comments on political things on the radio) are percentage men. Gordo was a land developer, which was paid a percentage of revenue, the same is true of mini-Gordo.

Percentage shills only make money when the economy expands in a reverse pyramid fashion, where the least money goes to the poorest. When the economy falters, the percentage men do not make money. As they know, no other trade, they beat the expanding economy drum, trying to inflate the economy. This is why everyone is so desperate for 'infrastructure' money as billions will be spent on needless projects which will artificially warm the economy for only a short time and then we fall flat on our arse again.

The world's economy is a massive ponsie scheme and it will come to grief, as it is doing now.

To make a clumsy story short - we are in a hell of a mess and the stock market is feeding our ills, not solving them.

Pretty much a useless

Pretty much a useless article, recycling the tired old mumbojumbo that passes for economic analysis while missing (or avoiding) the crucial point. Rafe, when will you ask the simple question: where does money come from? Only the answer provides the necessary insight. Do you hear me, Mssrs Mair, Beers, Dobbin, et al?

Over 95% of Canada's money supply is loaned into existence by the private banks. That's where our money comes from and that is why depressions, recessions, "tough economic times" are inevitable. That is why an undeserving elite exists.

Yes Grumpy, it's a ponzi scheme. The banks create money "out of thin air" by making an entry in a database, but only the principal of the loan is created. Yet, principal plus interest is demanded in repayment. Unearned money must be repayed with blood sweat and tears. The debt now exceeds the money supply by over three to one, there is never enough money in circulation to repay the banks, and every new loan exacerbates the situation. It's simple, elegant, and evil. Money reform is the only way out. Do you hear me, Mssrs. Mair, Beers, Dobbin, et al? Do you hear me, gentle reader?

Many Saw it Coming Except Elites

Bang on Rafe. Many, many people actually DID see this unholy collapse of the neocon house of cards. Everyone who even remotely looked at things objectively. Except the elites. The corporate, political and media elites who "run" our society. As a ruling class become ever more rarified and undemocratic, this is exactly what you get.

Examples abound. The 1789 French court laughed at the thought of a revolution. Stalin's regime thought it was invincible before it fell. Hoover supported new IPO issues in 1929 and 1930. Bush was telling us all was fine this summer. Harper and Campbell are still racing to lower taxes in-spite of the damage it does. All are examples of elite "group think". They all drink the same cool-aide. All comply with the party line.

If we want more democracy, we have to become involved. Immediately. Democracy was NEVER just given to citizens. It always took the effort of many, many people.

As always, great stuff Tyee.

Smarts

Rafe, you may be arguing that the floor is still to fall (although you don't), but you state you withdrew your funds in 2003.

The TSX Composite is still worth more now than then. Maybe you'd look smart if you sold around the peak. Your self-congratulation misses the mark.

Yes Rafe I saw it coming too

Yes Rafe I saw it coming too and did get out of the game.I was advised by my financial adviser that "all was well and don't worry about it", even a year ago. A couple of months ago a was talking to a retired financial councillor from Vancouver who said that they whole scheme was unraveling in '06 but certain actions by our new CONservative Government delayed it. On Michael Campbell, he just rolled his eyes and said he's just a huckster sales man.

Easy to see, Rafe

The dumbing down of America started with Regan, along with the raising of "patriotism." The Clinton years reversed the process somewhat but basically, America has turned into a form of fascist corporatism.

As with any great empire, when the rich are only concerned with making themselves more rich, the process eventually breaks down. All empires get into a situation where short term gain becomes the goal. Building your national economy becomes secondary to this. Society spirals into disorder, the empire seeks to fill its coffers with booty from foreign wars and the costs of both of these make them counterproductive.

Watching the US media, I don't see much hope for optimism. The basic problems that America faces such as health care and poverty are not really issues at all. All I see is "pundits" seeking to maintain the status quo or go back to an era that really didn't exist.

Rafe is entirely correct in his assertion that what has happened in the USA is practically identical to 1929. The main reason it could happen again is that there really aren't too many people alive who lived through the Great Depression.

Obama has quite a tough row to hoe; his biggest challenge will be overcoming ignorance.

1929 Safeguards Well-Known

Mair writes: "Lastly, we were convinced and let ourselves be convinced that things were much different than in 1929. There were safeguards in place -- though no one seemed to know what these were."
I'm not an economist, but I know pretty much what these safeguards were. It's hardly rocket science.
The key regulation preventing a repeat of 1929 was the 1933 Glass-Steagall Act that separated commercial and investment banking.
Glass-Steagall was repealed in 1999 by the Rubin-Summers Treasury Dept (with distinguished lobbying by Phil Gramm).
Other important regulations, such as that governing debt to capital ratios, were similarly gutted.
The history of this deliberate de-regulation is well understood, and makes it difficult to see what Mair is trying to say in the quotation given above.

of course 'they' knew

>how come the seven-figure prognosticators in New York and Toronto didn't know?

Who says they didn't know ? I know someone in the biz who knew the dot.com bubble was to burst, and so got out, and knew this was to burst as well, so got out 18 months ago. But it is not his business to go trumpeting this to his clients.

They knew, BUT it doesn't matter to them. They'll make money, lots of it, one or or another, and so their ludicrous prognostications have _little effect_ on their own well being.

it makes perfect sense, except for the fact that most people, aided and abetted by the press of course, continue to listen to the crap spewing from these people, rather than doing their own digging, or even just using their common sense.

Good one Rafe.

The whole system is based on a human characteristic which will be the cause of its decline. Greed! That Rafe and others saw it coming may be a simple appreciation that the greedy people who run it did not really know that you can not keep taking without one day having to account. That kind of clarity of thinking only comes when you have a few miles on the clock. Why keep investing in a system which is fueled by greed? You can't take it with you.

I think Cynic has a point but I still think Rafe's article is worthy. Once we accept Rafe's axiom "1 then maybe a discussion of who manipulates our currency to their advantage will happen. As for Alive, friend is isn't ground hog day yet>

A random thought or two

Ok, so this upcoming Provincial election should be about shutting down the "Gateway" infrastructures projects. These are solely for the purpose of moving mass quantities of cheap goods quickly and more cheaply from Asia through to Central Canada and USA. This infrastructure is to be paid for by the taxpayer in order to profit corporate North America. So lets stop this and save our children's children the $ billions in needless government debt.

Obama seems to be taking his economic strategy from the Bush policies. A few hundred in tax reduction for business and families.

What?

So America can go to the mall and shop their way out of this? Whats the percentages in that? Saving mall jobs and a few transport jobs? Nothing sold in the mall is made in North America.

It sounds to me that this economic strategy is really coming from Beijing to the Washington.

Unlike Rafe I wasn't so smart. I could see it coming, but as a typical Canadian worker I really didn't have a great big nest egg to protect. Mine is in my workplace pension and matching contributions. So I guess I could have elected not to contribute to my pension. I saw this coming, but was in no position to really control my destiny. I suspect this is the reality for most of us.

When everyone's buying Bre-X you know the show-stopper is about fall out of the sky.

And we all come tumbling down

Canada's stock market loses 700 Billion or 35% for the 2008 year while economists predict the housing market grumbles as prices in the west fall. And The Bank of Canada is predicting many will lose their homes if the economy continues to suffer. And your right its depressing and apparently we are not as infallible as lead to believe.

Got out in 2003?

Rafe, this doesn't make any sense. You say you got out of the market in 2003. Got out how? Did you transfer all of your investments to cash? Property? What?

What worries me about this article is that it refers to a desire to get out of the bull market way back in 2003. Yet it ignores the fact that the dot-com bubble burst in 2000, resulting in the TMT crash that occurred between 2000 and 2002, wiping out a lot of value on the NASDAQ index and taking companies down with it. It was between 2003 and 2007 that we had the big bull market that has now crashed.

Getting out in 2003 meant getting out when the markets were only just recovering from the dot-com crash. Sure, the TMT crash was more a blip in comparison to what we have now, but if we want to talk about bull markets, we have to talk about 2003 as being the beginning of the most recent one.

Also, as articles about the recent financial crash go, this is a weak effort. If you want to learn more about where all this money came from and how it all went wrong, listen to the episode of This American Life on NPR titled "The giant pool of money" and "Another frightening show about the economy".

http://www.thislife.org/Radio_Archive.aspx?year=2008