4 leading liberal PhD economists are calling for nationalization of American banks:
- Nobel economist Joseph Stiglitz
- Nobel economist Paul Krugman
However, Obama has said that he will not nationalize banks.
Tuesday, February 10, 2009
Leading Liberal Economists Call for Bank Nationalization
6 comments:
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Nationalizing banks are a good thing if one is a Marxist. If one is a capitalist, nationalizing banks is a bad thing. So, it comes down to whether Marxism or capitalism is the better system, imo. Because nationalizing banks is definitely not capitalist, doesn't allow the market to correct itself, and is Marxist. Failing to allow the market to correct itself creates greater inefficiencies and compounds the problems Marxism was supposed to "help". Nationalizing banks will backfire and create more harm than good, imo.
ReplyDeleteWe need to bationalize the Federal Reserve Bank. All credit whether checking account money or Federak Reserve Notes (which woukd be replaced by Treasury Notes), Banks should be limited to loaning out depositors money. I would prefer to have all pension money deposited in co-operatively owned trusts. I would like to see the co-ops also handle insurance. It would take all power from the New York banks.
ReplyDeleteOK, let the market correct itself. Now tell me how many banks will be left when the correction is over. The only thing that's kept them afloat till now is bailout money. Some of the big outfits will go away and some say that would be a good thing because it would return banking to a regional business that would have more incentive to hold on to the mortgages and loans they make because they would have to eat them when they went bad.
ReplyDeleteIf we did nationalize them and bought the assets at current market prices they might as well go out of business because a lot of their assets have no market value. How many bucks of worthless derivatives do they currently hold. Estimates run all the way to a 1000 trillion dollars.
Letting the market correct itself will have the effect of further consolidation into monopolies rather than regionalization. The strong eating the less strong until you have just one or two entities that decide which businesses or individuals get credit and can continue.
ReplyDeleteHere is the deal with nationalization. For one thing, you might look at Roubini's background. I would question his characterization as "liberal". Nationalization is just the other side of the same coin. Nationalization is also further consolidation into one power source with the SAME EFFECT. This is all about big, worldwide control and either path gives "the powers that be" what they desire.
We do need to clip the FED's wings drastically, especially on the printing money thing. That is real taxation without representation. Hopefully,in rejecting either path, Obama is considering a return to regulation and anti-trust in such a deliberate fashion that it will get us back to many local banks that are able to institute more informed lending practices, local boards and provide more choices. If so, it is not a quick fix and will not happen without a royal battle.
As far as people chosen to perform certain functions, I prefer to wait and see. Even if you are brilliant at what you do, you still have to perform as you are asked in order to stay employed. We have had many years where the prime employers have been less than ideal. The brilliant experienced people they employed may be able to function even more brilliantly in a different venue with a different focus and purpose. With things in crisis mode, we don't want a bunch of idiots in there like "Brownie", who was in charge of FEMA when Katrina struck.
It's not only the "leftie" economists who think nationalization is in order. None less than the Financial Times says:
ReplyDelete"Mr Obama and Mr Geithner are still not drawing the logical conclusion: banks must be forced to write down their losses now. If they do, many will be exposed as insolvent, and the government must take them over and recapitalise them. Saving the financial system will take more money and a greater degree of public control than the government is yet willing to admit."
Everyone should google "money as debt" and watch the video. Our whole banking system is an immense ponzi scheme where private banks are allowed to create our money. Google also "The American Monetary Act" to see what should and could be done: Nationalize the Fed and the big banks that are "too big to fail" and cause the US Govt to issue money as A. Lincoln did.
ReplyDelete