The Current Depression

[OMGAKITTY]

That's not how the economy works. At all.

 

 

But it will really help the economy' date=' and if we save, we can pay off our dept to China.

[/quote']

 

LOL

Please tell me you're a troll.

 

Lets give a basic example of what happens when everyone saves.

 

Bob owns a restaurant. He makes good money. He spends his money at Joe's hardware store. Jenny likes to eat at Bob's restaurant. But recently, she's decided to cut back on spending, and save her money. Suddenly, Bob isn't making as much money, because Jen isn't eating at his restaurant. Bob decides he can't afford to waste his money buying tools at Joe's hardware store. Joe loses profit because Bob is no longer shopping at his store. Regretfully, he stops going to Lou's bookstore. Lou can't keep going to Jenna's hair salon, because he isn't making enough money, because Joe isn't coming to his bookstore anymore. Now Jenna doesn't have enough money to....

 

 

You get the idea?

[PrometheusMFD]

You do realize that isn't how the economy works?

 

Lets say Bob, Joe, and Steve all eat at Sam's restaurant. Bob and Joe decide that they are spending money. Steve still goes to Sam's restaurant, so Sam continues to get an income. He spends this income at Joe's Grocery store, thus giving Joe more money to spend at Sam's Restaurant. Also, since Bob also shops at Joe's Grocery Store, Bob can spend money at Bob's Hardware Store. Coincidentally, they all shop at Steve's bookstore.

 

This example shows how the economy fluctuates.

 

Now say the Government comes in to "help" Sam's Restaurant. The Government takes money from Bob, Joe, and Steve (who would have spent it at Sam's in the first place) and gives it to Sam. Rather than spend it at Bob's, Joe's, and Steve's, or at least any employees he has, Sam spends every penny on his own personal living.

 

This example shows how the bailout is currently working

[OMGAKITTY]

Because when when Sam spends it on his "own personal living", he isn't buying things from other people.

 

I was giving a very very basic example...and I didn't mean that because Bob or whatever I used stopped shopping at store X, that store X no longer had money, I was saying that because there are less people buying things there, their income is lowered, not gone. Lowered income = less spending which = lower income for other industries.

 

 

But back to your example, lets say the government doesn't decide to help Bob out. Bob's company goes bankrupt, and the 20 people he employed are now unemployed. Because the economy is bad, no one else is hiring, so they stay unemployed. They do not have money to spend at Joe's, Sam's, etc etc stores, so all those companies now have to lay off employees to save money. Those people can no longer find jobs either........

 

And Sam, Joe, etc etc weren't spending money at Bob's, because Laura, Jen, etc etc aren't buying at their stores, so they want to save money.

 

If Bob hadn't been a jackass and had used the money as it was supposed to be used, his employees keep their jobs, the economy is still crap, but at least the people still have their jobs, so they aren't voting their congressmen out of office.

[PrometheusMFD]

But if the government helps out, and people spend money on themselves, rather than giving it back to the people the money came from, then the economy goes stagnant and eventually falls apart. This is the exact thing that is happening from the bailout.

[OMGAKITTY]

But if the government helps out' date=' and people spend money on themselves, rather than giving it back to the people the money came from, then the economy goes stagnant and eventually falls apart. This is the exact thing that is happening from the bailout.

[/quote']

 

Joe buys a tv from Bob's store. Is Joe buying the tv to help out Bob? No. He's buying it to benefit himself. Bob's benefit is a side-effect. Capitalism is based on caring only about yourself >_>

[PrometheusMFD]

The gov't takes money from Sue and gives it to Bob

Bob takes the money and spends it in the bahamas

that is how things are working.

[Man0waR]

what the problem is is that we blame something or someone and say well do something (obama) LOL. And we dont do anything to remedy the situation. So far, my boss had to lay-off 3 people this month. My grandfathers retirement benefits are gone, and I get average of 16,000$ a year instead of $20k. If we can start acting to rectify the economy, then we can start living like it was back in '99-'01. But The government just says 'well take as long as we can and work as hard as we can to solve the issue' but no action is taken. So Americans loose jobs everyday and it will continue until we and the government can stop blaming groups like- Terrorists, obama, or bush for our problems and just focus on a solution.

[____pi____]

Let's hope Obama's plans pull through. Tax cuts' date=' etc.

[/quote']

Tax cuts will not help the econemy, they will sicken it, what will help the econemy over all is better health care and education. Obamas education plan is pretty good exept for the basing the results on test, not grades and test.

[Holy Babylon]

There is no Depression. The material things in this life can only hope to be just as great as the things we will have waiting for us in our next life.

[OMGAKITTY]

There is no Depression. The material things in this life can only hope to be just as great as the things we will have waiting for us in our next life.

 

Its things like this that make other people hate Christians, you know.

[Tempest Dahlia]

...People are so self-centered!

They only say it's a depression and complain when it is they who are finally suffering!

WHERE IS THE FAIL-SAFE BACKUP PLAN!?!? IT'S CALLED SAVINGS!!! IS IT THAT HARD PEOPLE!?!?

Well... I don't know everyone's situation... but still.

[OMGAKITTY]

Yeah, because back in the Great Depression, its not like the banks failed or anything.

[Tempest Dahlia]

Yeah' date=' because back in the Great Depression, its not like the banks failed or anything.

[/quote']

 

Are the banks failing now? And what the hell are you even talking about?

Banks will never, ever be secure. Those who put all their money in a bank are fools for thinking that it's safe. All it is... Is just convienence.

My mother and father are both wealthy in their own right. Both of them have about 40% of their money in the bank. Smart idea, I think.

---

I believe that the first thing that needs to be done to reverse the recession is to get the housing crisis under control.

 

I agree.

And also, to make sure history dosen't repeat itself with the stocks...

btw how are the stocks going? I never understood it.

[Tabris]

hahahahaha Canada is going to be out the recession first then any other country in the world

 

That I believe.

 

Which reminds me of an article in Newsweek.

---

Let's hope Obama's plans pull through. Tax cuts' date=' etc.

[/quote']

 

Obama DID WHAT?!

[Dark]

To be honest, I didn't see as much an effect on my family's life compared to others. I wouldn't consider myself rich (more like upper middle-class), but I didn't feel as much of a change.

[Tempest Dahlia]

To be honest' date=' I didn't see as much an effect on my family's life compared to others. I wouldn't consider myself rich (more like upper middle-class), but I didn't feel as much of a change.

[/quote']

 

Exactly.

People like us really can't say anything about the recession because we're not experiencing it. To me, the word "recession" is meh. To others it isn't a good word at all.

My mother STILL didn't teach me the word 'no' yet! XD So i'm still unaffected.