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The establishment will blame their next crash on freedom—just like last time, and they will blame us too this time.

The establishment has had the economy on the precipice of collapse ever since 2008, and the next crash may have already begun, but if it hasn't, then it is pretty obvious that it is near.

The establishment will blame their next crash on freedom (e.g. a free economy)—just like they did last time, but if there had actually been freedom, then the crash would not only have gone very differently—it would not have happened in the first place.

This time the establishment will blame their crash on anti-establishment types too (that's us) because they have convinced everyone that Donald Trump is the anti-establishment President, and going forward, he can be plausibly blamed by the media because he has been in office long enough and because he has done something different enough—the trade wars.

Regarding the previous crash, the stock market began declining in November 2007 when the government forced every bank to switch to a different method (mark-to-market) to value their assets (e.g. subprime mortgages), and the stock market began growing steadily again in March 2009 when the government forced every bank to go back to the old method (mark-to-model). Of course, in a free economy, banks would have used whatever method they wanted whenever they wanted, so none would have gone bankrupt because those not already using mark-to-model when the market demand for CDOs (made up of subprime home mortgages) temporarily stopped could have simply switched to mark-to-model whenever sales volume went below a certain threshold like it did in 2008.

Everyone in the world would have considered it reasonable if banks had been allowed to say that they couldn't rely solely on market prices when there was almost no market activity at that moment; whereas, by forcing mark-to-market on the banks, government was forcing them to value their assets (CDOs made up of subprime home mortgages) at only 20% of what the underlying homes were worth, which is obviously nonsense, but which enabled many already very rich insiders to make billions by betting this would happen.

In a free world, if these investment banks (they were not consumer banks) had somehow gone bankrupt anyway, then more responsible banks could have taken their place (a.k.a "creative destruction" ). Then the economy would have recovered like it always had before, but instead of letting them choose their asset valuation model, and instead of letting them go bankrupt, banks were forced to take trillions of dollars printed out of thin air, and banks (e.g. the Federal Reserve) then loaned trillions of dollars (printed out of thin air) to the government, so the federal debt is now more than twice as much as it was in 2008, and yet, the millions of quality jobs that we began losing in 2008 never came back, and wages went down, and the percentage of people employed (labor participation rate), which collapsed in 2008, also never came back, which is different than every previous recession/crash, except for one—the Great Depression.

So, the economy never actually recovered from the crash of 2008, but the stock market did indeed quadruple because where else was all that money printed out of thin air going to go? That's just inflation. Be glad that the price of food, clothes, cars, etc. hasn't quadrupled—yet.

Of course, in a free economy there would have been no CDO market crash (and hence no stock market crash) for so many reasons. For example, banks would have never given loans to people who couldn't pay them back if they hadn't known that government (e.g. Fannie Mae) would buy those (subprime) loans from them, and of course, the people would not have been utterly clueless about all of this before, during, and since ... if we had any free and independent media bigger than a blog.

The controlled media say that the 2008 crisis was caused by the repeal of Glass-Steagall (they never admit that was signed by Bill Clinton either), but that was a non issue because Bear Stearns, Lehman Brothers, and AIG did not have any checking or savings accounts.

How many times have you heard the establishment place any blame on how banks and the media are in bed with government (a.k.a. cronyism)?

I am really just scratching the surface of the role of government, media, and cronyism in causing the crash and perpetrating the cover up, but it should already be clear that the free market and anti-establishment types are the last people we should blame.

jafbm 5 Oct 14
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2 comments

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0

it is true that you're only scratching the surface. that is why it cannot be taken on face value. well, that and the fact that you use the word "establishment" to describe different establishments, different administrations anyway, and the fact that you make statements that might be true but you just state them AS true without any backup. some of what you say IS true. some of it... not so much. that's generally true of generalities lol.

g

I have lots of references to back up what I say...if you're interested in reading them

@jafbm no not especially. i don't need references for generalities. i actually have been alive during a great number of administrations and i paid attention. i don't need your references.

g

0

Amen.

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