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Thread: A Look at History: The Great Depression

  1. #1
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    A Look at History: The Great Depression

    The world is a much different place but some similarities can't be ignored. Even assuming it doesn't get this bad, our world is dramatically changing...



    [QUOTE][SIZE="6"][B]The Great Depression[/B][/SIZE]

    The Great Depression was a worldwide economic downturn starting in most places in 1929 and ending at different times in the 1930s or early 1940s for different countries. It was the largest and most important economic depression in modern history, and is used in the 21st century as a benchmark on how far the world's economy can fall. The Great Depression originated in the United States; historians most often use as a starting date the stock market crash on October 29, 1929, known as Black Tuesday. The end of the depression in the U.S. is associated with the onset of the war economy of World War II, beginning around 1939.[1]

    The depression had devastating effects both in the developed and developing world. International trade was deeply affected, as were personal incomes, tax revenues, prices, and profits. Cities all around the world were hit hard, especially those dependent on heavy industry. Construction was virtually halted in many countries. Farming and rural areas suffered as crop prices fell by 40 to 60 percent.[2][3] Facing plummeting demand with few alternate sources of jobs, areas dependent on primary sector industries such as farming, mining and logging suffered the most.[4] Even shortly after the Wall Street Crash of 1929, optimism persisted. John D. Rockefeller said that "These are days when many are discouraged. In the 93 years of my life, depressions have come and gone. Prosperity has always returned and will again."[5]

    The Great Depression ended at different times in different countries; for subsequent history see Home front during World War II. [B]The majority of countries set up relief programs, and most underwent some sort of political upheaval, pushing them to the left or right.[/B][/QUOTE]

    We may be doing the same.

    [QUOTE]
    In some states, the desperate citizens turned toward nationalist demagogues - the most infamous being Adolf Hitler - setting the stage for World War II in 1939.

    [SIZE="5"][B]The Downward Spiral[/B][/SIZE]

    The Great Depression was not a sudden total collapse. [B]The stock market turned upward in early 1930, returning to early 1929 levels by April, though still almost 30 percent below the peak of September 1929.[6] Together, government and business actually spent more in the first half of 1930 than in the corresponding period of the previous year.[/B][/QUOTE]

    No doubt our government will be spending like crazy.

    [QUOTE]
    [B]But consumers, many of whom had suffered severe losses in the stock market the previous year, cut back their expenditures by ten percent[/B], and a severe drought ravaged the agricultural heartland of the USA beginning in the northern summer of 1930.

    In early 1930, credit was ample and available at low rates, but people were reluctant to add new debt by borrowing.[citation needed] [B]By May 1930, auto sales had declined to below the levels of 1928[/B]. Prices in general began to decline, but wages held steady in 1930, then began to drop in 1931. Conditions were worst in farming areas, where commodity prices plunged, and in mining and logging areas, where unemployment was high and there were few other jobs. The decline in the American economy was the factor that pulled down most other countries at first, then internal weaknesses or strengths in each country made conditions worse or better. Frantic attempts to shore up the economies of individual nations through protectionist policies, such as the 1930 U.S. Smoot-Hawley Tariff Act and retaliatory tariffs in other countries, exacerbated the collapse in global trade. By late in 1930, a steady decline set in which reached bottom by March 1933.

    [B][SIZE="5"]Causes[/SIZE][/B]

    There were multiple causes for the first downturn in 1929, including the structural weaknesses and specific events that turned it into a major depression and the way in which the downturn spread from country to country. [B]In relation to the 1929 downturn, historians emphasize structural factors like massive bank failures and the stock market crash, while economists (such as Peter Temin and Barry Eichengreen) point to Britain's decision to return to the Gold Standard at pre-World War I parities (US$4.86:1).[/B]

    Main article: Causes of the Great Depression
    Recession cycles are thought to be a normal part of living in a world of inexact balances between supply and demand. What turns a usually mild and short recession or "ordinary" business cycle into a great depression is a subject of debate and concern. Scholars have not agreed on the exact causes and their relative importance. The search for causes is closely connected to the question of how to avoid a future depression, and so the political and policy viewpoints of scholars are mixed into the analysis of historic events eight decades ago. The even larger question is whether it was largely a failure on the part of free markets or largely a failure on the part of governments to curtail widespread bank failures, the resulting panics, and reduction in the money supply. Those who believe in a large role for governments in the economy believe it was mostly a failure of the free markets and those who believe in free markets believe it was mostly a failure of government that compounded the problem.

    Current theories may be broadly classified into three main points of view. First, there is orthodox classical economics: monetarist, Austrian Economics and neoclassical economic theory, all of which focus on the macroeconomic effects of money supply and the supply of gold which backed many currencies before the Great Depression, including production and consumption.

    Second, there are structural theories, most importantly Keynesian, but also including those of institutional economics, that point to underconsumption and overinvestment (economic bubble), malfeasance by bankers and industrialists, or incompetence by government officials. The only consensus viewpoint is that there was a large-scale lack of confidence. Unfortunately, once panic and deflation set in, many people believed they could make more money by keeping clear of the markets as prices got lower and lower and a given amount of money bought ever more goods.

    Third, there is the Marxist critique of political economy. This emphasizes contradictions within capital itself (which is viewed as a social relation involving the appropriation of surplus value) as giving rise to an inherently unbalanced dynamic of accumulation resulting in an overaccumulation of capital, culminating in periodic crises of devaluation of capital. The origin of crisis is thus located firmly in the sphere of production, though economic crisis can be aggravated by problems of disproportionality of over-production in the manufacturing and related production sectors and the underconsumption of the masses.

    [B][SIZE="5"]Debt[/SIZE][/B]

    Debt is seen as one of the causes of the Great Depression[citation needed], particularly in the United States[citation needed]. [B]Macroeconomists including Ben Bernanke, the current chairman of the U.S. Federal Reserve Bank, have revived the debt-deflation view[citation needed] of the Great Depression originated by Arthur Cecil Pigou and Irving Fisher:[citation needed] in the 1920s, American consumers and businesses relied on cheap credit[citation needed], the former to purchase consumer goods such as automobiles and furniture, and the latter for capital investment to increase production[citation needed]. This fueled strong short-term growth but created consumer and commercial debt[citation needed]. People and businesses who were deeply in debt when price deflation occurred or demand for their product decreased often risked default[citation needed]. Many drastically cut current spending to keep up time payments, thus lowering demand for new products. Businesses began to fail as construction work and factory orders plunged.[/B]

    Massive layoffs occurred, resulting in US unemployment rates of over 25% by 1933. Banks which had financed this debt began to fail as debtors defaulted on debt and depositors attempted to withdraw their deposits en masse, triggering multiple bank runs. Government guarantees and Federal Reserve banking regulations to prevent such panics were ineffective or not used. Bank failures led to the loss of billions of dollars in assets.[8] Outstanding debts became heavier, because prices and incomes fell by 20–50% but the debts remained at the same dollar amount. After the panic of 1929, and during the first 10 months of 1930, 744 US banks failed. (In all, 9,000 banks failed during the 1930s). By 1933, depositors had lost $140 billion in deposits.[8]

    [B]Bank failures snowballed as desperate bankers called in loans which the borrowers did not have time or money to repay. With future profits looking poor, capital investment and construction slowed or completely ceased. In the face of bad loans and worsening future prospects, the surviving banks became even more conservative in their lending.[8] Banks built up their capital reserves and made fewer loans, which intensified deflationary pressures. A vicious cycle developed and the downward spiral accelerated. This kind of self-aggravating process may have turned a 1930 recession into a 1933 great depression.[/B]
    [/QUOTE]

    (more at [url]http://en.wikipedia.org/wiki/Great_depression[/url] )
    Last edited by jetstream23; 10-11-2008 at 06:28 AM.

  2. #2
    [B]A Look At The Future: The Great Depression II[/B]

    Which Presidential candidate will perform better - Obama or McCain?

    Ans: McCain.

    Complete Democratic party dominance in the 1930's. That's why the Great Depression lasted so long.

    Can't have that again with Obama-Biden-Pelosi-Reid. We need a Republican somewhere in there.

    :jets18

  3. #3
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    [QUOTE=AlbanyJet;2799115][B]A Look At The Future: The Great Depression II[/B]

    Which Presidential candidate will perform better - Obama or McCain?

    Ans: McCain.

    [B]Complete Democratic party dominance in the 1930's. That's why the Great Depression lasted so long.[/B]

    Can't have that again with Obama-Biden-Pelosi-Reid. We need a Republican somewhere in there.

    :jets18[/QUOTE]

    I'm sorry. That's about as asinine a response i've ever seen. That's just partisan bullcrap and clearly shows you have no idea what actually caused and perpetuated the Great depression.

    Here are two main reasons why the great depression was perpetuated:
    1) Fixed exchanged rates backed by the gold standard
    2) Widespread panic in the financial sector that caused runs on the banks.

    How were these two problems solved? FDR moved away from a gold standard. He started devaluing gold in order to expand the money supply. Ever hear of the FDIC? You don't have to worry about runs on banks because your deposits are insured.

    I disagree with a bunch of FDR's policies, but he got us out of the Great depression.

  4. #4
    [QUOTE=Jets Voice of Reason;2799217]I disagree with a bunch of FDR's policies, but he got us out of the Great depression.[/QUOTE]

    Well, OK, but a lot of people think war production for WWII got us out of the Great Depression.

    Even in an episode of The Simpsons, bright little Lisa made that observation.

    :lisa:

  5. #5
    The taxes were raised and spending was increased does this sound like some one else!

  6. #6
    [url]http://chronicle.com/temp/reprint.php?id=477k3d8mh2wmtpc4b6h07p4hy9z83x18[/url]

    This is an interesting article about a depression that hit in the 1870s, before the Great Depression. The writer makes interesting comparisons that make this a better comparison than 1930s. I don't enough about 19th century history to confirm or refute this information, but thought everyone would find it interesting
    [QUOTE]As a historian who works on the 19th century, I have been reading my newspaper with a considerable sense of dread. While many commentators on the recent mortgage and banking crisis have drawn parallels to the Great Depression of 1929, that comparison is not particularly apt. Two years ago, I began research on the Panic of 1873, an event of some interest to my colleagues in American business and labor history but probably unknown to everyone else. But as I turn the crank on the microfilm reader, I have been hearing weird echoes of recent events.

    When commentators invoke 1929, I am dubious. According to most historians and economists, that depression had more to do with overlarge factory inventories, a stock-market crash, and Germany's inability to pay back war debts, which then led to continuing strain on British gold reserves. None of those factors is really an issue now. Contemporary industries have very sensitive controls for trimming production as consumption declines; our current stock-market dip followed bank problems that emerged more than a year ago; and there are no serious international problems with gold reserves, simply because banks no longer peg their lending to them.

    In fact, the current economic woes look a lot like what my 96-year-old grandmother still calls "the real Great Depression." She pinched pennies in the 1930s, but she says that times were not nearly so bad as the depression her grandparents went through. That crash came in 1873 and lasted more than four years. It looks much more like our current crisis.

    The problems had emerged around 1870, starting in Europe. In the Austro-Hungarian Empire, formed in 1867, in the states unified by Prussia into the German empire, and in France, the emperors supported a flowering of new lending institutions that issued mortgages for municipal and residential construction, especially in the capitals of Vienna, Berlin, and Paris. Mortgages were easier to obtain than before, and a building boom commenced. Land values seemed to climb and climb; borrowers ravenously assumed more and more credit, using unbuilt or half-built houses as collateral. The most marvelous spots for sightseers in the three cities today are the magisterial buildings erected in the so-called founder period.

    But the economic fundamentals were shaky. Wheat exporters from Russia and Central Europe faced a new international competitor who drastically undersold them. The 19th-century version of containers manufactured in China and bound for Wal-Mart consisted of produce from farmers in the American Midwest. They used grain elevators, conveyer belts, and massive steam ships to export trainloads of wheat to abroad. Britain, the biggest importer of wheat, shifted to the cheap stuff quite suddenly around 1871. By 1872 kerosene and manufactured food were rocketing out of America's heartland, undermining rapeseed, flour, and beef prices. The crash came in Central Europe in May 1873, as it became clear that the region's assumptions about continual economic growth were too optimistic. Europeans faced what they came to call the American Commercial Invasion. A new industrial superpower had arrived, one whose low costs threatened European trade and a European way of life.

    As continental banks tumbled, British banks held back their capital, unsure of which institutions were most involved in the mortgage crisis. The cost to borrow money from another bank — the interbank lending rate — reached impossibly high rates. This banking crisis hit the United States in the fall of 1873. Railroad companies tumbled first. They had crafted complex financial instruments that promised a fixed return, though few understood the underlying object that was guaranteed to investors in case of default. (Answer: nothing). The bonds had sold well at first, but they had tumbled after 1871 as investors began to doubt their value, prices weakened, and many railroads took on short-term bank loans to continue laying track. Then, as short-term lending rates skyrocketed across the Atlantic in 1873, the railroads were in trouble. When the railroad financier Jay Cooke proved unable to pay off his debts, the stock market crashed in September, closing hundreds of banks over the next three years. The panic continued for more than four years in the United States and for nearly six years in Europe.

    The long-term effects of the Panic of 1873 were perverse. For the largest manufacturing companies in the United States — those with guaranteed contracts and the ability to make rebate deals with the railroads — the Panic years were golden. Andrew Carnegie, Cyrus McCormick, and John D. Rockefeller had enough capital reserves to finance their own continuing growth. For smaller industrial firms that relied on seasonal demand and outside capital, the situation was dire. As capital reserves dried up, so did their industries. Carnegie and Rockefeller bought out their competitors at fire-sale prices. The Gilded Age in the United States, as far as industrial concentration was concerned, had begun.

    As the panic deepened, ordinary Americans suffered terribly. A cigar maker named Samuel Gompers who was young in 1873 later recalled that with the panic, "economic organization crumbled with some primeval upheaval." Between 1873 and 1877, as many smaller factories and workshops shuttered their doors, tens of thousands of workers — many former Civil War soldiers — became transients. The terms "tramp" and "bum," both indirect references to former soldiers, became commonplace American terms. Relief rolls exploded in major cities, with 25-percent unemployment (100,000 workers) in New York City alone. Unemployed workers demonstrated in Boston, Chicago, and New York in the winter of 1873-74 demanding public work. In New York's Tompkins Square in 1874, police entered the crowd with clubs and beat up thousands of men and women. The most violent strikes in American history followed the panic, including by the secret labor group known as the Molly Maguires in Pennsylvania's coal fields in 1875, when masked workmen exchanged gunfire with the "Coal and Iron Police," a private force commissioned by the state. A nationwide railroad strike followed in 1877, in which mobs destroyed railway hubs in Pittsburgh, Chicago, and Cumberland, Md.

    In Central and Eastern Europe, times were even harder. Many political analysts blamed the crisis on a combination of foreign banks and Jews. Nationalistic political leaders (or agents of the Russian czar) embraced a new, sophisticated brand of anti-Semitism that proved appealing to thousands who had lost their livelihoods in the panic. Anti-Jewish pogroms followed in the 1880s, particularly in Russia and Ukraine. Heartland communities large and small had found a scapegoat: aliens in their own midst.

    The echoes of the past in the current problems with residential mortgages trouble me. Loans after about 2001 were issued to first-time homebuyers who signed up for adjustablerate mortgages they could likely never pay off, even in the best of times. Real-estate speculators, hoping to flip properties, overextended themselves, assuming that home prices would keep climbing. Those debts were wrapped in complex securities that mortgage companies and other entrepreneurial banks then sold to other banks; concerned about the stability of those securities, banks then bought a kind of insurance policy called a credit-derivative swap, which risk managers imagined would protect their investments. More than two million foreclosure filings — default notices, auction-sale notices, and bank repossessions — were reported in 2007. By then trillions of dollars were already invested in this credit-derivative market. Were those new financial instruments resilient enough to cover all the risk? (Answer: no.) As in 1873, a complex financial pyramid rested on a pinhead. Banks are hoarding cash. Banks that hoard cash do not make short-term loans. Businesses large and small now face a potential dearth of short-term credit to buy raw materials, ship their products, and keep goods on shelves.

    If there are lessons from 1873, they are different from those of 1929. Most important, when banks fall on Wall Street, they stop all the traffic on Main Street — for a very long time. The protracted reconstruction of banks in the United States and Europe created widespread unemployment. Unions (previously illegal in much of the world) flourished but were then destroyed by corporate institutions that learned to operate on the edge of the law. In Europe, politicians found their scapegoats in Jews, on the fringes of the economy. (Americans, on the other hand, mostly blamed themselves; many began to embrace what would later be called fundamentalist religion.)

    The post-panic winners, even after the bailout, might be those firms — financial and otherwise — that have substantial cash reserves. A widespread consolidation of industries may be on the horizon, along with a nationalistic response of high tariff barriers, a decline in international trade, and scapegoating of immigrant competitors for scarce jobs. The failure in July of the World Trade Organization talks begun in Doha seven years ago suggests a new wave of protectionism may be on the way.

    In the end, the Panic of 1873 demonstrated that the center of gravity for the world's credit had shifted west — from Central Europe toward the United States. The current panic suggests a further shift — from the United States to China and India. Beyond that I would not hazard a guess. I still have microfilm to read.
    [/QUOTE]

  7. #7
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    [QUOTE=AlbanyJet;2799407]Well, OK, but a lot of people think war production for WWII got us out of the Great Depression.

    Even in an episode of The Simpsons, bright little Lisa made that observation.

    :lisa:[/QUOTE]

    One thing isn't what got us out of the Great Depression. The two things i mentioned above were just as big of factors that got us out of the Depression as job creation in WWII. The New deal and WWII in conjunction is what got us out of it.

    I just cited the two things above because you said that democratic leadership in the 30s perpetuated the problem when that is far from the truth.

  8. #8
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    [QUOTE=AlbanyJet;2799407]Even in an episode of The Simpsons, bright little Lisa made that observation.

    :lisa:[/QUOTE]

    Wow. Someone more bent than I am. We should grab a beer sometime.

    Still...I prefer to learn economics and history from "Family Guy"...

  9. #9
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    [QUOTE=MnJetFan;2799446]The taxes were raised and spending was increased does this sound like some one else![/QUOTE]

    God forbid Obama decided to raise taxes in the face of this kind of economic turmoil. Talk about pouring fuel on a fire!

    I honestly don't think it would happen. His economic advisors would have to coach him out of that.

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    [QUOTE=jetstream23;2799738]God forbid Obama decided to raise taxes in the face of this kind of economic turmoil. Talk about pouring fuel on a fire![/QUOTE]

    Have you seen significant declines in your taxes since Bush took office. Have you?

  11. #11
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    [QUOTE=BushyTheBeaver;2799745]Have you seen significant declines in your taxes since Bush took office. Have you?[/QUOTE]

    Taxes certainly haven't gone up but I'm most concerned with taxes on small businesses, corporations, etc. (i.e. the base of job creation in this country). There is no better way to crush job growth than by increasing taxes on job creators.

  12. #12
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    [QUOTE=jetstream23;2799749]Taxes certainly haven't gone up but I'm most concerned with taxes on small businesses, corporations, etc. (i.e. the base of job creation in this country). There is no better way to crush job growth than by increasing taxes on job creators.[/QUOTE]

    Cool but you didn't answer the question. Have you seen cuts in you taxes in the past 8 years.

  13. #13
    "The failure of the New Deal seems incredible considering that FDR is widely rated among America's greatest presidents. Moreover, many of the brightest minds of the era were recruited to Washington. FDR, who graduated from Harvard College, filled many of his top positions with graduates of Harvard Law School. They had clerked with the most respected judges of the era. These and other New Dealers were hailed for their compassion and their so-called progressive thinking. They were widely viewed as more noble than the greedy businessmen and reckless speculators who were thought to have brought on the depression. New Dealers wanted to eliminate poverty, abolish child labor, and right other social wrongs. Many New Dealers saw themselves as trying to make the world over. How could such bright, compassionate people have gone so wrong?"

    "The most troubling issue has been the persistence of high unemployment throughout the New Deal period. From 1934 to 1940, the median annual unemployment rate was 17.2 percent. At no point during the 1930s did unemployment go below 14 percent. Even in 1941, amidst the military buildup for World War II, 9.9 percent of American workers were unemployed. Living standards remained depressed until after the war.2"

    [url]http://hnn.us/articles/3800.html[/url]

    :jets18

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    [QUOTE=Jets Voice of Reason;2799217]I'm sorry. That's about as asinine a response i've ever seen. That's just partisan bullcrap and clearly shows you have no idea what actually caused and perpetuated the Great depression.

    Here are two main reasons why the great depression was perpetuated:
    1) Fixed exchanged rates backed by the gold standard
    2) [B]Widespread panic in the financial sector that caused runs on the banks[/B].

    How were these two problems solved? FDR moved away from a gold standard. He started devaluing gold in order to expand the money supply. Ever hear of the FDIC? You don't have to worry about runs on banks because your deposits are insured.

    I disagree with a bunch of FDR's policies, but he got us out of the Great depression.[/QUOTE]

    that wide spread panic is starting to creep into the north american mind set, the people need to her that things are going to be ok..and they will be...but in this age of day with 24 hrs news these news bags/whores need to fill time and it's nothing but fear mongering...it's counter productive right now

  15. #15
    Been on record on these threads as stating a return to the gold standard would be a good thing for a long term solution to the current crisis - the failure of the previous gold-standard was really down to political interference.

    I think the examination of economic history does show that the previous 30 years of 'prosperity' that we've had is really castles made of sand, or rather, castles made of debt, that will soon fall down.

  16. #16
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    [QUOTE=AlbanyJet;2799798]"The failure of the New Deal seems incredible considering that FDR is widely rated among America's greatest presidents. Moreover, many of the brightest minds of the era were recruited to Washington. FDR, who graduated from Harvard College, filled many of his top positions with graduates of Harvard Law School. They had clerked with the most respected judges of the era. These and other New Dealers were hailed for their compassion and their so-called progressive thinking. They were widely viewed as more noble than the greedy businessmen and reckless speculators who were thought to have brought on the depression. New Dealers wanted to eliminate poverty, abolish child labor, and right other social wrongs. Many New Dealers saw themselves as trying to make the world over. How could such bright, compassionate people have gone so wrong?"

    "The most troubling issue has been the persistence of high unemployment throughout the New Deal period. From 1934 to 1940, the median annual unemployment rate was 17.2 percent. At no point during the 1930s did unemployment go below 14 percent. Even in 1941, amidst the military buildup for World War II, 9.9 percent of American workers were unemployed. Living standards remained depressed until after the war.2"

    [url]http://hnn.us/articles/3800.html[/url]

    :jets18[/QUOTE]

    The new deal wasn't just an economic package. FDR made a lot of mistakes in "the new deal" when he tried a whole bunch of programs that failed. But you again, are missing the point. Devaluing gold and providing stability to banks are major reasons why we got out of the Great Depression. Look up the article written by Christina Romer on the Great Depression and stop trying to say that FDR didn't help us out of the Great Depression because that's just wrong.

  17. #17
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    [QUOTE=Black Death;2799805]Been on record on these threads as stating a return to the gold standard would be a good thing for a long term solution to the current crisis - the failure of the previous gold-standard was really down to political interference.

    I think the examination of economic history does show that the previous 30 years of 'prosperity' that we've had is really castles made of sand, or rather, castles made of debt, that will soon fall down.[/QUOTE]

    The gold standard didn't just fail because of political interference. Investors took advantage of the fixed exchange rate system, made speculative attacks on currency, and then the government contracted money supply to stop gold from being devalued. Eventually this pattern of behavior led to recession, and was, in fact, one of the major causes of the Great Depression.

    Fiat currency system has inflation problems and obviously credit issues can occur, but the Gold Standard comes with its own set of problems. Again, there is a reason why we went away from it. Unless you can tell me why the same pattern of speculative attacks would not occur, I won't be convinced.

  18. #18
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    [QUOTE=BushyTheBeaver;2799753]Cool but you didn't answer the question. Have you seen cuts in you taxes in the past 8 years.[/QUOTE]

    Abosolutely.

  19. #19
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    [QUOTE=AlbanyJet;2799115][B]A Look At The Future: The Great Depression II[/B]

    Which Presidential candidate will perform better - Obama or McCain?

    Ans: McCain.

    Complete Democratic party dominance in the 1930's. That's why the Great Depression lasted so long.

    Can't have that again with Obama-Biden-Pelosi-Reid. We need a Republican somewhere in there.

    :jets18[/QUOTE]

    You need a history lesson. The Stock Market crash whice led to the Great Depression occured during the republican presidency of Herbert Hoover.

    Republican Presidents and the Depressions/Recessions Under Their Watch:

    Herbert Hoover (1929 Stock Market Crash and The Great Depression)
    George H.W. Bush (recession of the early 1990's)
    George W. Bush (two recessions, early 2000's and the current debacle)
    John McCain (will inherit the current debacle from Bush and make it worse)

  20. #20
    wrong. the austrian wallpaper hanger got us out of the great depression. he also caused our post war prosperity because the us was the last man standing.

    as for fdr, his policies tended to excerbate the problem. he came with all of those wonderful democrat ideals and finally had to resort to programs that hoover had espoused to even maintain a semblence of order.

    things that aren't widely reported about the fdr is that the unemployment rate was pretty muched fixed at 17% for fdr's whole time and that fdr ordered the slaughter of livestock and plowed under ripe food stuffs to prop up farm prices at the same time as people were starving. now that's democrats in action for you. moreover, what also isn't stated is that the 17% unemployment was chronic. meaning that whoever was unemployed at the start stayed unemployed.

    the reason why we might weather this storm in good shape is because the banking systems are working in concert with each other whereas in the depression, they were all trying to get the upper hand.

    [QUOTE=Jets Voice of Reason;2799217]I'm sorry. That's about as asinine a response i've ever seen. That's just partisan bullcrap and clearly shows you have no idea what actually caused and perpetuated the Great depression.

    Here are two main reasons why the great depression was perpetuated:
    1) Fixed exchanged rates backed by the gold standard
    2) Widespread panic in the financial sector that caused runs on the banks.

    How were these two problems solved? FDR moved away from a gold standard. He started devaluing gold in order to expand the money supply. Ever hear of the FDIC? You don't have to worry about runs on banks because your deposits are insured.

    I disagree with a bunch of FDR's policies, but he got us out of the Great depression.[/QUOTE]

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