# Calling all you Crackpot Capitalists



## TheBigShort (21 Sep 2017)

I've been somewhat critical in the past, and present, of cheerleaders that vaunt the free market system without hesitation and their total ignorance of the intricate nature of delivering a public service formulated through public policy to the citizens of a State.

Their tendency is to applaud and admire all wealth and it's 'creators' while disregarding (putting it lightly), those that are 'dependent' on their goodwill through welfare transfers and accommodation.

Anyway, to cut my speel short, here is an article from the US that shows how free market capitalism is the only game in town, and how a socialist like me is always way off the mark?

http://www.marketwatch.com/story/ho...-17-trillion-as-stock-market-rises-2017-09-21

In other words, the article projects notions of wealth, feel good factor, trickle down economics etc,
When in reality, it is nothing more than an engineered money printing scam  to keep those that have already accumulated vast wealth, feeling good about themselves so that they won't panic and expose the facilities of the 'free market' capitalist system.
In turn, what emerges is a trickle-up economic system. With increasing wealth becoming more and more centralised.

I bring this topic up now because I believe the world is heading for the economic depression that was diverted in 2008-2012 by way of a stop-gap money printing scam called QE.


----------



## TheBigShort (22 Sep 2017)

As an add on to this, anyone following geo-political affairs will be aware that Russi/China/Iran are moving towards exiting the petro/dollar system.
Should this occur, then expect the citizenry of Saudi Arabia to rise up when the price of the US dollar falls and the price of imports rocket. Collapsing a key US ally.
What is preventing this collapse of US hegemony is their military strength, demonstrated by provocations of North Korea. A country that has no economic, political or strategic interest in the US, other than the continued and persistent presence of nuclear carrying US warships on its coast.
In the end, the US threat to annihilate North Korea, is in actual a threat to Russia/China/Iran if they try destroy the US dollar.


----------



## Palerider (22 Sep 2017)

Nothing new in the linked piece.


----------



## Andy836 (22 Sep 2017)

Ah bless, someone leaked the People Before Profit budget speach......


----------



## dub_nerd (22 Sep 2017)

TheBigShort said:


> Anyway, to cut my speel short, here is an article from the US that shows how free market capitalism is the only game in town, and how a socialist like me is always way off the mark?
> 
> http://www.marketwatch.com/story/ho...-17-trillion-as-stock-market-rises-2017-09-21


How is that free market capitalism? Q.E. and asset buying programs are the epitome of socialism ... for the rich. Socialism always ends up being run by elites. It's in its nature.


----------



## TheBigShort (22 Sep 2017)

Andy836 said:


> Ah bless, someone leaked the People Before Profit budget speach......



That's actually quite funny


----------



## TheBigShort (22 Sep 2017)

dub_nerd said:


> How is that free market capitalism?



That is a fair point, hence the term 'crackpot capitalist'. I should have emphasized that this system purports itself to be free market capitalism. It is not.
I don't agree that it is socialism either. So-called socialist states in the Soviet Union, North Korea only purported to be socialist, they were/are nothing more than central command economies serving an elite.
The US is now, or very close to that point also, and in my opinion near collapse.
It is under threat from decreasing reliance on the US dollar as the world's reserve currency, and it is now reacting with what it sees is its only way to preserve its status as the world's largest economy, through its military.


----------



## Firefly (22 Sep 2017)

TheBigShort said:


> I don't agree that it is socialism either. So-called socialist states in the Soviet Union, North Korea only purported to be socialist



Ah yes, you nearly forgot to mention that didn't you? 

Ask yourself how the average man, woman and child have fared in Russia, China & N Korea since 1945? Look which way people moved when the Berlin wall came done. Look at the shambles that is Venezuela and even our own Greece. 

Socialism is a failed and dangerous ideology and I thank my lucky stars that I live in a country where the vast majority see it for what it is.


----------



## Purple (22 Sep 2017)

Socialism is a mo


Firefly said:


> Ah yes, you nearly forgot to mention that didn't you?
> 
> Ask yourself how the average man, woman and child have fared in Russia, China & N Korea since 1945? Look which way people moved when the Berlin wall came done. Look at the shambles that is Venezuela and even our own Greece.
> 
> Socialism is a failed and dangerous ideology and I thank my lucky stars that I live in a country where the vast majority see it for what it is.


Socialism is a morally bankrupt ideology and is not a viable solution to cronyism. Cronyism; that's what the article is actually talking about.


----------



## TheBigShort (22 Sep 2017)

Firefly said:


> Ah yes, you nearly forgot to mention that didn't you?



Actually, for you personally, it's been explained at length on a number of occasions. You obviously don't pay attention.



Firefly said:


> Ask yourself how the average man, woman and child have fared in Russia, China & N Korea since 1945?



Why?



Firefly said:


> Look which way people moved when the Berlin wall came done



West. Is there a point somewhere?



Firefly said:


> Look at the shambles that is Venezuela and even our own Greece.



Great, Greece, a bankrupt country that, under a right wing government,  colluded with the centralised command banking sector to work the books in order to join the Euro.
Apparently that's the fault of socialism!

Venezuela, a country that elected a government to arrest control of the wealth being generated from its natural resources away from the centralised banking cartels.
Inducing US economic sanctions and interference with its democratic systems.
And that's the fault of socialism too?


----------



## TheBigShort (22 Sep 2017)

Purple said:


> Cronyism; that's what the article is actually talking about.



Exactly.
Those that advocate  it are the crackpot capitalists. Just as the cheerleaders for the Soviet Union and NK are the Looney left.
Both are deluded in thinking that this is a free market economy or that USSR was a socialist society.


----------



## Purple (22 Sep 2017)

TheBigShort said:


> Exactly.
> Those that advocate  it are the crackpot capitalists. Just as the cheerleaders for the Soviet Union and NK are the Looney left.
> Both are deluded in thinking that this is a free market economy or that USSR was a socialist society.


The free market is an artificial construct. Without regulation there would be no Google as Microsoft would have been able to force every company selling computers with a Windows operating system to use their internet browser. There are plenty of other examples. 
The problem is when a group or vested interest can exert undue influence on a market or on the democratic process, including the way in which laws and regulations are framed. I'm opposed to all such groups and bodies. We are citizens and this is a democratic republic. All power should come from the people through their democratically elected representatives and only through those representatives.
Very large corporations, industry groups (such as the health insurance industry and Gun Lobby in the USA), Investment Funds, Trade Unions etc. all seek to subvert democracy by influencing the government. All of them are a corrosive influence and that influence always leads to cronyism.


----------



## TheBigShort (22 Sep 2017)

Purple said:


> The free market is an artificial construct. Without regulation there would be no Google as Microsoft would have been able to force every company selling computers with a Windows operating system to use their internet browser. There are plenty of other examples.
> The problem is when a group or vested interest can exert undue influence on a market or on the democratic process, including the way in which laws and regulations are framed. I'm opposed to all such groups and bodies. We are citizens and this is a democratic republic. All power should come from the people through their democratically elected representatives and only through those representatives.
> Very large corporations, industry groups (such as the health insurance industry and Gun Lobby in the USA), Investment Funds, Trade Unions etc. all seek to subvert democracy by influencing the government. All of them are a corrosive influence and that influence always leads to cronyism.



I agree with most of this.

The centralized command economies of the Soviet Union and NK were/are "a group or vested interest can exert _undue influence_ on a market or on the democratic process, including the way in which laws and regulations are framed", namely their respective governments and party political assemblies.

The centralizing command economy of the US and the EU are "a group or vested interest can exert _undue influence_ on a market or on the democratic process, including the way in which laws and regulations are framed", namely the banking and financial sector under the Federal Reserve and ECB.

I don't agree that organisations cannot seek to influence government, no more or less, than an individual can attempt to influence government policy by protesting, campaigning etc.
I do agree that it is abundantly clear, where influence is made, it is not always transparent and influence tends to disproportionately weigh in favor of large organisations.


----------



## Purple (22 Sep 2017)

All lobby groups and organisations, and I am thinking particularly of Trade Unions here, are self serving and ultimately act against the common good.
The undue influence of big business and finance is more obviously corrosive to the common good. 

People who run corporations are no more or less civic minded or ethical than anyone else. Therefore the blinkered and morally superior look only at their agenda and dismiss the voices of  others who have a different perspective. Allowing those voices which have a narrow and myopic agenda is damaging. The pernicious nature of those agendas is hard to pin down and so it is usually only in hindsight that we see the consequences.


----------



## Early Riser (22 Sep 2017)

Purple said:


> Very large corporations, industry groups (such as the health insurance industry and Gun Lobby in the USA), Investment Funds, Trade Unions etc. all seek to subvert democracy by influencing the government. All of them are a corrosive influence and that influence always leads to cronyism.





Purple said:


> All lobby groups and organisations, and I am thinking particularly of Trade Unions here, are self serving and ultimately act against the common good.
> The undue influence of big business and finance is more obviously corrosive to the common good.



While I could agree a value with this in principle, I can't grasp a system in which it would operate in practice. Aren't nearly all lobby groups self-interested? What about local resident's associations? The Chamber of Commerce? Would it be ok for an individual farmer to lobby for his/her own interest but not for a group to band together to do so?

We need a system in which no group has undue influence and transparency to see what influence is being brought to bear.In practice this is very difficult, eg, the influence that can be applied indirectly through media control. But perhaps, I have missed the point?


----------



## Purple (22 Sep 2017)

Early Riser said:


> While I could agree a value with this in principle, I can't grasp a system in which it would operate in practice. Aren't nearly all lobby groups self-interested? What about local resident's associations? The Chamber of Commerce? Would it be ok for an individual farmer to lobby for his/her own interest but not for a group to band together to do so?
> 
> We need a system in which no group has undue influence and transparency to see what influence is being brought to bear.In practice this is very difficult, eg, the influence that can be applied indirectly through media control. But perhaps, I have missed the point?


No, that is the point. We need to call things what they are,


----------



## TheBigShort (22 Sep 2017)

Early Riser said:


> While I could agree a value with this in principle, I can't grasp a system in which it would operate in practice. Aren't nearly all lobby groups self-interested?



I agree with this sentiment.

Lobby groups can also provide a valuable service in raising awareness of social issues etc that can prompt government to introduce positive legislation - off the top of my head, anti-smoking lobby and trade union campaigning to ban smoking in the workplace.
Its when lobby groups exert undue influence, and that it is not wholly transparent what is behind a piece of legislation or a regulation that problems will arise.
Hence my reference to stock ownership in the US. I don't know about anybody else but I spend a considerable bit more time following affairs in the US than I ever did, and the more I follow, the more concerned I am at what is going on.


----------



## TheBigShort (24 Sep 2017)

Closer to home.

The centralised command banking economy, purporting to be a capitalist system, is ensuring that ever increasing debt will follow us to the grave

http://www.rte.ie/amp/906728/


----------



## PGF2016 (24 Sep 2017)

TheBigShort said:


> Closer to home.
> 
> The centralised command banking economy, purporting to be a capitalist system, is ensuring that ever increasing debt will follow us to the grave
> 
> http://www.rte.ie/amp/906728/



Only if you're an idiot who can't save. 

This is poor financial behaviour. Nothing more than that. There's no gun to anyone's head forcing them to be paying off a mortgage into retirement.


----------



## Gordon Gekko (24 Sep 2017)

Our bank allowed us to borrow beyond our retirement ages. They didn't force us to, they simply facilitated it, subject to us having pension schemes in place (with resulting pension income post retirement age). I don't believe that's reckless or them putting a gun to our heads. In reality, we will clear the mortgage down before then, but even if we don't, our retirement lump sums would kill it off.

But the above can still be spun as "Young Couple Forced to Borrow into their Dotage Shocker"!


----------



## TheBigShort (25 Sep 2017)

PGF2016 said:


> Only if you're an idiot who can't save



I think the point is, that if you are paying for a mortgage beyond retirement, it makes it harder to save.
Nothing idiotic about it all, just simple math.



PGF2016 said:


> This is poor financial behaviour. Nothing more than that.



Yes it is I agree. I guesstimate that most people make the decision to take out a mortgage once, maybe twice or three times max in their lifetimes.
On the other hand, banks issue mortgages to thousands of people week in week out.
So if it's poor financial behaviour on the part of the borrower, then it is nothing short of idiocy to the point of reckless criminality on the part of the lender.



PGF2016 said:


> There's no gun to anyone's head forcing them to be paying off a mortgage into retirement.



Not literary. But if they don't keep up payments they could lose their home. Probably added to the housing waiting list.


----------



## The Horseman (25 Sep 2017)

Yes it is I agree. I guesstimate that most people make the decision to take out a mortgage once, maybe twice or three times max in their lifetimes.
On the other hand, banks issue mortgages to thousands of people week in week out.
So if it's poor financial behaviour on the part of the borrower, then it is nothing short of idiocy to the point of reckless criminality on the part of the lender.

At the end of the day it is a contract between two parties, the borrower should do there own due diligence.


----------



## TheBigShort (25 Sep 2017)

Gordon Gekko said:


> Our bank allowed us to borrow beyond our retirement ages. They didn't force us to, they simply facilitated it, subject to us having pension schemes in place (with resulting pension income post retirement age). I don't believe that's reckless or them putting a gun to our heads. In reality, we will clear the mortgage down before then, but even if we don't, our retirement lump sums would kill it off.



That's terrific, and I'm sure it will all work out well for you in the end. 
Our bank also offered us a mortgage beyond retirement age. It was very tempting, but we sat down and did the numbers. It was simply unsustainable, considering we have two boys that will, hopefully go on to college. 
In the end, we had to consider why a bank be offering these unsustainable loan?


----------



## Gordon Gekko (25 Sep 2017)

How is it unsustainable?


----------



## Firefly (25 Sep 2017)

TheBigShort said:


> Closer to home.
> 
> The centralised command banking economy, _purporting to be a capitalist system_, is ensuring that ever increasing debt will follow us to the grave
> 
> http://www.rte.ie/amp/906728/



Link please?


----------



## PGF2016 (25 Sep 2017)

TheBigShort said:


> That's terrific, and I'm sure it will all work out well for you in the end.
> Our bank also offered us a mortgage beyond retirement age. It was very tempting, but we sat down and did the numbers. It was simply unsustainable, considering we have two boys that will, hopefully go on to college.
> In the end, we had to consider why a bank be offering these unsustainable loan?


Maybe the bank thinks you'll honour your debt. You're the idiot if you take on the loan and in the knowledge that you won't be able to afford it as you'll have to pay for the education of your boys. Again not the bank's fault but your own.


----------



## Gordon Gekko (25 Sep 2017)

The bank (UB in this case) looked for details of the underlying pension schemes. 

Lending to people who will have meaningful tax-free lump sums and pension income post-65; whatever is the world coming to!


----------



## TheBigShort (25 Sep 2017)

PGF2016 said:


> Maybe the bank thinks you'll honour your debt. You're the idiot if you take on the loan and in the knowledge that you won't be able to afford it as you'll have to pay for the education of your boys. Again not the bank's fault but your own.



Firstly, we didnt take on the loan.
Secondly, do you think it's a good idea to have a banking system peddling loans in such an unsustainable manner?
Do you think it's a good idea that someone like myself, without a financial background, can conclude that the mortgage offer made to me was unsustainable, but that a bank (supposedly experts in the field of finance) cannot figure that out?


----------



## Gordon Gekko (25 Sep 2017)

TheBigShort said:


> Firstly, we didnt take on the loan.
> Secondly, do you think it's a good idea to have a banking system peddling loans in such an unsustainable manner?
> Do you think it's a good idea that someone like myself, without a financial background, can conclude that the mortgage offer made to me was unsustainable, but that a bank (supposedly experts in the field of finance) cannot figure that out?



Why is such a loan unsustainable?

I've direct experience of this and the bank wanted full details of the relevant pension schemes.

It's actually sensible lending; a bank getting under the bonnet and understanding its customers.


----------



## The Horseman (25 Sep 2017)

TheBigShort said:


> Firstly, we take on the loan.
> Secondly, do you think it's a good idea to have a banking system peddling loans in such an unsustainable manner?
> Do you think it's a good idea that someone like myself, without a financial background, can conclude that the mortgage offer made to me was unsustainable, but that a bank (supposedly experts in the field of finance) cannot figure that out?



If the bank advise you that you can't afford the loan you will complain you are not allowed make your own decision. Currently we have the loan to income scheme via the Central bank and people are complaining it is to strict. We as a people are not capable of making correct decisions (because there appears to be no consequences of same). I would reference the difficulty in repossessing houses.

What if after you have paid off your mortgage and the house is worth more than the mortgage, should the bank be entitled to a share in the increase?

At the end of the day a mortgage is a commercial transaction between you and the bank. if you can't honour it then you have to live with the consequences.


----------



## Firefly (25 Sep 2017)

TheBigShort said:


> I guesstimate that most people make the decision to take out a mortgage once, maybe twice or three times max in their lifetimes.
> On the other hand, banks issue mortgages to thousands of people week in week out.
> So if it's poor financial behaviour on the part of the borrower, then it is nothing short of idiocy to the point of reckless criminality on the part of the lender.



I see it the other way around. For the borrower it is a massive decision that should be really thought through. In addition, the borrower knows vastly more information than the lender. As you say, the lender issues thousands of mortgage. It has imperfect information and can not feasibly know everything about every applicant and so has to rely on standard checks. I am not for a minute saying the lender has no responsibility for this, but the borrower knows far more about their ability to pay.


----------



## TheBigShort (25 Sep 2017)

Firefly said:


> For the borrower it is a massive decision that should be really thought through.



Yes it should. But without a financial background, is it advisable to seek financial advice? Where would one get financial advice? From the financial sector perhaps? Would that include mortgage lenders?



Firefly said:


> In addition, the borrower knows vastly more information than the lender



Such as? The lender will typically ask a series of questions about your income, your dependents, age, etc and make its decision on this. If they need more information what would it be?



Firefly said:


> It has imperfect information and can not feasibly know everything about every applicant and so has to rely on standard checks. I am not for a minute saying the lender has no responsibility for this, but the borrower knows far more about their ability to pay.



If you micro analysis every applicant, I agree, it is not feasible. But that's why we have have 'big picture' data also, such as personal debt levels etc. So if a stat emerges that shows that nearly half of borrowers are borrowing into retirement for their mortgage that should make some people sit up. yes?/no?
Now if those borrowers have substantial lump-sum pension arrangements made then maybe its not such an issue after all. But if the big picture data also tells us that less than half of workers have a pension, that public service pension payments are a ticking time-bomb, then combining all these things, it paints a worrying picture for the future in my opinion. Including for those that think their lump-sum pension will be waiting for them for when they retire, guaranteed!


----------



## PGF2016 (25 Sep 2017)

TheBigShort said:


> Firstly, we didnt take on the loan.


Yes. You said as much already. 


TheBigShort said:


> Secondly, do you think it's a good idea to have a banking system peddling loans in such an unsustainable manner?
> Do you think it's a good idea that someone like myself, without a financial background, can conclude that the mortgage offer made to me was unsustainable, but that a bank (supposedly experts in the field of finance) cannot figure that out?



The bank doesn't know and can't know that you're going to take on an extra burden later that will make the loan unsustainable. It's up to the person taking the loan. Don't blame the banks for something that is not within their control.


----------



## The Horseman (25 Sep 2017)

TheBigShort said:


> Yes it should. But without a financial background, is it advisable to seek financial advice? Where would one get financial advice? From the financial sector perhaps? Would that include mortgage lenders?
> 
> 
> 
> What about independent financial advise?


----------



## TheBigShort (25 Sep 2017)

PGF2016 said:


> The bank doesn't know and can't know that you're going to take on an extra burden later that will make the loan unsustainable



What extra burden are you talking about? Is that a mortgage top-up, a brand new mortgage, credit card debt, a car loan, a holiday loan?
Are you seriously suggesting that banks aren't aware of additional financial obligations? Are you seriously suggesting that the headline posted above relates only to people who took out one mortgage and one mortgage only?
It is not, it relates to the fact that more and more people are borrowing larger and larger and amounts. This includes borrowing on top of existing debt, that is why, the stats are showing that more and more people will be paying off their mortgages well into retirement.

On an individual basis, for someone like your self, no problem.
But on a national basis, do you think this is a financially sound system?
Do you think the risks of default are increasing, and would that concern you if they were?

"_Simon Hoffman, pensions and investments director with Friends First, said a combination of the scale of mortgage debt, income pressure and the fact that people are getting on the housing ladder later in life may be the reason for this scenario. Mr Hoffman said problems may arise when the financial burden of a mortgage along with planning for retirement - two of the biggest financial assets that anyone can have - start to clash."_


----------



## Firefly (25 Sep 2017)

PGF2016 said:


> The bank doesn't know and can't know that you're going to take on an extra burden later that will make the loan unsustainable. It's up to the person taking the loan. Don't blame the banks for something that is not within their control.



Don't be silly. Why should there be _any _personal responsibility for the poor financially illiterate, naive borrower ? It's all the bank's fault don't you know.


----------



## TheBigShort (25 Sep 2017)

Firefly said:


> Why should there be _any _personal responsibility for the poor financially illiterate, naive borrower



Or the poor financially illiterate, naïve lender?


----------



## PGF2016 (25 Sep 2017)

TheBigShort said:


> What extra burden are you talking about? Is that a mortgage top-up, a brand new mortgage, credit card debt, a car loan, a holiday loan?
> Are you seriously suggesting that banks aren't aware of additional financial obligations? Are you seriously suggesting that the headline posted above relates only to people who took out one mortgage and one mortgage only?
> It is not, it relates to the fact that more and more people are borrowing larger and larger and amounts. This includes borrowing on top of existing debt, that is why, the stats are showing that more and more people will be paying off their mortgages well into retirement.
> 
> ...



My response was in reply to your previous comment about the loan that you were considering (as you well know). The extra burden was the college fees. Banks are perfectly aware of additional obligations. Where did I suggest otherwise? 

Is this a sound system? It could be if only those with the ability to repay are offered loans. I would defer to the banks actuaries to decide if the risks of default are increasing.


----------



## TheBigShort (25 Sep 2017)

PGF2016 said:


> My response was in reply to your previous comment about the loan that you were considering (as you well know). The extra burden was the college fees. _Banks are perfectly aware of additional obligations. _Where did I suggest otherwise?



Fair enough, but earlier you said;



PGF2016 said:


> The bank doesn't know and can't know that you're going to take on an extra burden later that will make the loan unsustainable



So I take out at 30yr mortgage at 30yrs of age. Ten years in, I need/want to buy a new car. Ten more years, college fees arrive. I support all of this through additional loans and re-mortgaging to the extent that my mortgage repayments will continue past age 66. This is income that I cannot put away for a pension. That is my responsibility. If I default, my fault. 
But if my personal circumstance is reflected in a large body of the working population, do you consider that banks have, in their capacity as 'expert financiers', any responsibility if defaults are to increase putting the banks balance sheets in jeopardy?


----------



## PGF2016 (25 Sep 2017)

TheBigShort said:


> Fair enough, but earlier you said;
> 
> 
> 
> ...


Let me update what I previously said: 
_Banks are perfectly aware of additional obligations... but can't 100% predict the future (and neither can the person taking the loan). There is an onus on the person taking the loan to understand their future plans where possible and to ensure they don't get themselves into a financial pickle. _


----------



## TheBigShort (25 Sep 2017)

PGF2016 said:


> Let me update what I previously said:
> _Banks are perfectly aware of additional obligations... but can't 100% predict the future (and neither can the person taking the loan)._



Yes, we will take that as a given.
But if the statistical data available to banks, is analysed in such form as to indicate increasing levels of debt, or increasing reliance on debt, or decreasing savings, or decreasing pension contributions or whatever, do you think there is an onus on the financial sector to re-act accordingly or do you think they should ignore all and carry on regardless?



PGF2016 said:


> There is an onus on the person taking the loan to understand their future plans where possible and to ensure they don't get themselves into a financial pickle.



Of course there is, just like there is an onus on the lender not to get themselves into a financial pickle, right?
But like you said, neither can predict the future.
So if you default, it probably won't make much difference to the banks in the greater scheme of things. But if defaults were rising and reflected in the broader population, and the banks, had information to hand that indicated stress points in personal debt (see rte report about mortgages being paid off past retirement), do you think that the financial sector and the central bank take any responsibility for the system that allows this to manifest? Regardless if you think it's a concern or not.


----------



## PGF2016 (25 Sep 2017)

TheBigShort said:


> Yes, we will take that as a given.
> But if the statistical data available to banks, is analysed in such form as to indicate increasing levels of debt, or increasing reliance on debt, or decreasing savings, or decreasing pension contributions or whatever, do you think there is an onus on the financial sector to re-act accordingly or do you think they should ignore all and carry on regardless?


There is absolutely an onus to react in some circumstances. Why should a bank care if the person they are lending to has a pension though? 



TheBigShort said:


> Of course there is, just like there is an onus on the lender not to get themselves into a financial pickle, right?
> But like you said, neither can predict the future.
> So if you default, it probably won't make much difference to the banks in the greater scheme of things. But if defaults were rising and reflected in the broader population, and the banks, had information to hand that indicated stress points in personal debt (see rte report about mortgages being paid off past retirement), do you think that the financial sector and the central bank take any responsibility for the system that allows this to manifest? Regardless if you think it's a concern or not.



Yes I do think the financial sector and central should address 'stress points' but only if they pose a problem to the sector. Why would they care if there are gaps in private pensions?


----------



## The Horseman (25 Sep 2017)

TheBigShort said:


> Yes, we will take that as a given.
> But if the statistical data available to banks, is analysed in such form as to indicate increasing levels of debt, or increasing reliance on debt, or decreasing savings, or decreasing pension contributions or whatever, do you think there is an onus on the financial sector to re-act accordingly or do you think they should ignore all and carry on regardless?
> 
> 
> So you want the bank to think for the borrower as well and that the borrower takes no responsibility for their decision to borrow the money. If they can't pay it back then its the banks fault.


----------



## TheBigShort (25 Sep 2017)

PGF2016 said:


> There is absolutely an onus to react in some circumstances. Why should a bank care if the person they are lending to has a pension though?



If a person is going to rely on their pension to re-pay a mortgage, why wouldn't they care if that person has a pension, and how much it's worth? 
If your mortgage repayments are going to be €1,000 a month on retirement for 5yrs, your pension of € 900 a month isn't going to cut it, is it?



PGF2016 said:


> Yes I do think the financial sector and central should address 'stress points' but only if they pose a problem to the sector. Why would they care if there are gaps in private pensions?



Now take the above scenario and multiply by, say, ten thousand mortgage holders.
Do you think that Mr Hoffman of Friends First may be trying to signal something when he says



TheBigShort said:


> ... _problems may arise when the financial burden of a mortgage along with planning for retirement - two of the biggest financial assets that anyone can have - start to clash."_


----------



## TheBigShort (25 Sep 2017)

Duplicate


----------



## Purple (25 Sep 2017)

TheBigShort said:


> *The centralised command banking economy*



I really like that description of the banking system but it's scary at the same time... somebody please explain to me why it is incorrect, and therefore I am also incorrect.


----------



## TheBigShort (30 Sep 2017)

Professor of Economics, Dr Richard Wolff calls for honest debate about the (crackpot) capitalist system 

https://youtu.be/zZtaJvzZev4


----------



## dub_nerd (30 Sep 2017)

TheBigShort said:


> Professor of Economics, Dr Richard Wolff calls for honest debate about the (crackpot) capitalist system
> 
> https://youtu.be/zZtaJvzZev4


I'm not sure I would ever associate the words "honest debate" with the RT channel (formerly Russia Today). Yer man must be doing the rounds -- he was on BBC Newsnight the night before last, introduced as a Marxist. He got run out of town, even by the normally left-leaning Beeb.


----------



## TheBigShort (30 Sep 2017)

Theresa May endorsing the free market system

https://www.gov.uk/government/speec...versary-of-bank-of-england-independence-event


----------



## Firefly (30 Sep 2017)

It must be great sport for socialists and communists to have the odd dig at capitalism.

Luckily though we have real-world examples where the turning to the left has had devestating results for the man on the street. Such examples are North and South Korea - just look at those poor, emanciated sticks of people in North Korea and look at its thriving neighbour to the south. We all remember the photos in 1989 when people were climbing over the Berlin wall from East to West. Soon after a raft of countries split from the USSR and there were celebrations in the streets. 
Just look at the near miracle of the chinese economy since it opened up to free trade and markets...millions lifted out of poverty into a growing middle class.

All of these examples however seem to pale into insignificance when compared to the fate of Venezuela and its neighbour, Columbia. Two interesting articles below:

http://www.worldaffairsjournal.org/blog/michael-j-totten/venezuela-collapses-colombia-rises
http://www.washingtonexaminer.com/a...ombia-and-socialist-venezuela/article/2635930

A few sentences from the World Affairs Journal above:

_Venezuela held democratic elections and experienced considerable, if uneven, economic growth. Throughout Latin America, Soviet-backed insurgencies battled it out with military regimes sponsored by the United States, but Cuba’s attempt to foment communist revolution in Venezuela fizzled.

After the Berlin Wall fell....If one had to choose where to invest at the time, the smart money would have been on Venezuela. It had a small middle class and a great deal of poverty, but that was hardly unique in South and Central America. What set it apart was its vast oil reserves—more than any other country on earth—and its relative political stability.

The current United Socialist Party government led by Nicolás Maduro, and formerly Hugo Chávez, could have done amazing things for the country with that vast oil wealth. Instead, the party has done its damndest to import Fidel Castro’s Cuban model of socialism— Chávez called Castro his mentor—and turn Venezuela into a totalitarian anthill.

They never quite pulled it off, never quite managed to create a state powerful enough to smother every human being under its weight. *Rather than molding Venezuelan society into a Stalinist Borg-hive, both—but Maduro especially—presided over a near-total collapse into anarchy, squalor and crime.*

*Last week the Washington Post called Venezuela a failed state. “The government has tried to control the economy to the point of killing it — all, of course, in the name of ‘socialism’…Venezuela has gotten something worse than death. It has gotten hell. Its stores are empty, its hospitals don't have essential medicines, and it can't afford to keep the lights on.”*

The inflation rate is almost 500 percent this year and is expected to exceed 1,500 percent next year. A hamburger costs 170 dollars. Everything is in short supply. “Venezuela reaches the final stages of socialism,” David Boaz writes. “*No toilet paper*.” Even hotels are asking guests to bring their own, which is almost impossible unless they’re coming in from abroad.

Violent crime has spread throughout the country, even to rural areas. Police officers don’t even attempt to suppress or solve crime, partly because they’re too busy protecting the crooked and oppressive government from its furious subjects, but also because crime is as ubiquitous in Venezuela right now as the heat and humidity. Last week, a fed up mob doused a man with gasoline and burned him alive for mugging another man and stealing the equivalent of five dollars._


From the second article:

_Ultimately, the dichotomy between Colombia and Venezuela speaks to one underlying truth. Trusting in the rule of law and free markets, Colombia is thriving. *But in 2017, under rabbit-lunatic Maduro, the land with Earth's largest oil reserves is now a realm of beggars and brigands, where teachers and even doctors are forced into prostitution just to feed themselves.*_


I am saying capitalism is perfect, but when we see what actually happened and what is happening when we choose the opposite, it's a no-brainer, unless of course you do not have a brain!


----------



## TheBigShort (30 Sep 2017)

Firefly said:


> It must be great sport for socialists and communists to have the odd dig at capitalism.



The topic is about the capitalist system and the way it is currently organised and how it operates. Please try stay in topic.

From Theresa Mays speech;

"_But problems were developing which would later become apparent during the financial crisis of 2007-08.

The Great Recession which followed that crisis brought some of the most challenging economic times our country has known."
_
It is clear to me that Theresa May, an advocate of free market capitalism, recognises now, that the system as It operates, or operated, led to serious problems. She goes on to list a number of measures taken that she concludes will ensure a fairer and more robust system to prevent the same thing ever happening again.
I'm not convinced. QE and other measures are sticking plasters. I agree with Professor Wolff that a constant repairing of parts is long-term unsustainable and that ultimately the system itself doesn't work as it is engineered.


----------



## Firefly (30 Sep 2017)

Of course when knocking something it is always reasonable to ask what the alternatives are and how these alternatives might be better. The alternative to capitalism, which has lifted millions out of poverty, is a socialist/communist utopia which has only ever resulted in tyranny, corruption and poverty for the man on the street. Luckily for us here in Ireland the people who advocate such a system are, rightly, in a tiny minority.


----------



## TheBigShort (30 Sep 2017)

Firefly said:


> when knocking something it is always reasonable to ask what the alternatives are and how these alternatives might be better.



Absolutely, hence the call for an honest debate.



Firefly said:


> The alternative to capitalism, which has lifted millions out of poverty, is a socialist/communist utopia which has only ever resulted in tyranny, corruption and poverty for the man on the street.



Is that the only alternative? I suggest it is not.



Firefly said:


> Luckily for us here in Ireland the people who advocate such a system are, rightly, in a tiny minority.



True. But those of us advocating an alternative to the current capitalist system of plunder and profit by way of environmental destruction are growing in number.
A true democratic socialist republic to enshrine the rights of each individual in equal measure affording the freedoms to trade, engage, assemble and prosper without fear or favour, in an ethically and environmentally sustainable way, is one other alternative.

I have some ideas of my own of how that can be achieved, such as maximum income. On this site, that concept doesn't receive any support. Fair enough, but the point is that ideas need to be forthcoming and examined.
To simply disregard alternative viewpoints, as you consistently do, and automatically revert to your default position that the system you live in now is favourable to other systems (e.g NK, USSR), even though nobody is advocating those systems, shows a shallowness in actual thinking.

Here is what Theresa May says about free market capitalism, to which I broadly agree with as I am sure you do too?

_"When countries make the transition from closed, restricted, centrally-planned economies to open, free market policies, the same things happen.

Life expectancy increases, and infant mortality falls._

_Absolute poverty shrinks, and disposable income grows.

Access to education is widened, and rates of illiteracy plummet._

_Anticipation in cultural life is extended, and more people have the chance to contribute._

_It is in open, free market economies that technological breakthroughs are made which transform, improve and save lives._

_It is in open, free market economies that personal freedoms and liberties find their surest protection._

_A free market economy, operating under the right rules and regulations, is the greatest agent of collective human progress ever created."
_
That's the good stuff. The underlined however points to the bad stuff.
As much as societies have prospered and developed under capitalism, it comes with a massive cost. In case you aren't aware, there is a train of thought, scientifically supported, that suggests that the capitalist system as currently modelled is responsible for an adverse change in the planet's climate with potentially disastrous consequences.
There is also another train of thought, with good reasoning in my opinion, that this system is sustained on the might of the US military industrial complex and its use of force around the world. Projecting the greatest tyrannical empire in the history of humankind.
And if that is not bad enough, it is all for a capitalist systems as currently modelled that is prone to collapse again and again. The 2007/8 financial collapse being the obvious case in point, but also the Weimar republic of Germany with its subsequent disastrous consequences.  And of course the great Depression in the US from 1929, a failed capitalist market system by itself.

I refer to Mays speech again, talking about solutions;

_"It consists of an open market place, in which everyone is free to participate, regulated under the rule of law, with personal freedoms, equality and human rights democratically guaranteed, and an accountable government, progressively taxing the economic activity which the market generates, to fund high-quality public services which are freely available to all citizens, according to need._

_That is unquestionably the best, and indeed the only sustainable, means of increasing the living standards of everyone in a country._

_And we should never forget that raising the living standards and protecting the jobs of ordinary working people is the central aim of *all* economic policy."_


When hospital waiting lists, housing lists, mortgage defaults are increasing, when suicide rates are all time high, when house prices and rents are out of reach for ordinary working people, then the system is broken and it is unsustainable.
When public finances are reliant on increasing debt, when personal debt is to be carried into retirement, when pension schemes are simply not going to deliver, do you think that fits with what May has touched on? I certainly don't.

Finally, if the last part of Mays speech that I quoted came from Jeremy Corbyn instead, would anyone be surprised? Or would they just take the automatic default position and continue to babble on about NKorea and USSR?


----------



## Purple (2 Oct 2017)

TheBigShort said:


> When hospital waiting lists, housing lists, mortgage defaults are increasing, when suicide rates are all time high, when house prices and rents are out of reach for ordinary working people, then the system is broken and it is unsustainable.


Those issues are mainly the result of government and State incompetence and cronyism and have nothing to do with a capitalist system.



TheBigShort said:


> There is also another train of thought, with good reasoning in my opinion, that this system is sustained on the might of the US military industrial complex and its use of force around the world. Projecting the greatest tyrannical empire in the history of humankind.


 That's just hyperbolic nonsense. The USA abuses it's power and is economically imperialistic but, and this is the bit that matters, no country in history has ever been as powerful and abused it's power less. 



TheBigShort said:


> As much as societies have prospered and developed under capitalism, it comes with a massive cost. In case you aren't aware, there is a train of thought, scientifically supported, that suggests that the capitalist system as currently modelled is responsible for an adverse change in the planet's climate with potentially disastrous consequences.


 Nobody poluted like socialist countries. The correlation between pollution and governmental system is that countries where the people control the government pollute less and the countries where the government control the people pollute more.


----------



## Purple (2 Oct 2017)

TheBigShort said:


> A true democratic socialist republic to enshrine the rights of each individual in equal measure affording the freedoms to trade, engage, assemble and prosper without fear or favour, in an ethically and environmentally sustainable way, is one other alternative.


 That's what a democratic republic does. The socialism but is incompatible with the freedom to trade and prosper.



TheBigShort said:


> I have some ideas of my own of how that can be achieved, such as maximum income. On this site, that concept doesn't receive any support. Fair enough, but the point is that ideas need to be forthcoming and examined.


 See that's the problem with socialists; the way in which wealth is being generated has changed (away from labour and onto capital and intellectual property) so we need to change our taxation system globally to make it fit for purpose. You guys just want to keep the system we have but go nuts on the well off for ideological reasons. That's not a solution, it's just petty begrudgery of those who have more than you with no consideration of why they have more or the consequences of taking it from them.


----------



## Firefly (2 Oct 2017)

Socialism is a scam anyway. Take a look at how self-declared socialists admit to investing in Bitcoin, the antithesis of regulation that they so crave. As we all know Bitcoin is directly linked to all sorts of crimes, some of which are too difficult to even mention. But that's OK I guess as there might be a few bob to be made. So much for standing with those at the bottom suffering. Is it any wonder than the "Champagne Socialist" moniker is so true?


----------



## TheBigShort (2 Oct 2017)

Purple said:


> Those issues are mainly the result of government and State incompetence and cronyism and have nothing to do with a capitalist system.



Government and State incompetence and cronyism for sure, ideological wedded to the concept of free market capitalist system.
As you mentioned before the 'free market' is simply a notion. It is unattainable yet governments and their cheerleaders persistently push this notion to drive through policies of plunder.
I think Theresa May goes so way to acknowledging this in her speech without explicitly saying so. The only problem I suspect, is that that speech was geared to stop the public continually moving to Labour.



Purple said:


> The USA abuses it's power and is economically imperialistic but, and this is the bit that matters, no country in history has ever been as powerful and abused it's power less.



That is quite a statement. Where do we start? Hiroshima? Nagasaki? Korea, Vietnam, Laos, Iraq, Afghanistan, Cuba?



Purple said:


> Nobody poluted like socialist countries. The correlation between pollution and governmental system is that countries where the people control the government pollute less and the countries where the government control the people pollute more.



Seriously, the call was for an honest debate. Next you will be telling me that China is one of the world's biggest polluters because the communist government controls the people, and then tell me that China is great example of a country abandoning socialism and adopting capitalism.
Next you will be telling me that the increase in carbon emissions into the environment over last 50yrs has more to do with state controlled command economies rather than increasing economic activity associated with open markets. Theresa May points acknowledges this in her speech, don't you agree?
Here is a link to the list of countries and there associated carbon emissions 

https://en.m.wikipedia.org/wiki/Lis..._dioxide_emissions_world_map_deobfuscated.png





Purple said:


> the way in which wealth is being generated has changed (away from labour and onto capital and intellectual property) so we need to change our taxation system globally to make it fit for purpose.



What would you propose?


----------



## Purple (2 Oct 2017)

TheBigShort said:


> Government and State incompetence and cronyism for sure, ideological wedded to the concept of free market capitalist system.


 Do you really think that Ireland, with the most "progressive" income taxation system in the developed world and 20% of the population living on welfare, is "ideological wedded to the concept of free market capitalist system"?



TheBigShort said:


> That is quite a statement. Where do we start? Hiroshima? Nagasaki? Korea, Vietnam, Laos, Iraq, Afghanistan, Cuba?


 So you think that the USA should have invaded mainland Japan and cost a vast multiple of Japanese lives? Maybe you think they should have stayed out of the Second World War altogether? You think they should not have been part of the UN force which stopped a Chinese Communist takeover of Korea, with all of the country under the great ruler they have in the North? Vietham was France's mess which the USA got dragged into and screwed up. I agree on Laos, Iraq, Afghanistan. Cuba is a despicable and oppressive country.
You should have mentioned Nicaragua or the colonial war they fought against Spain to take over the Philippines or the wars they fought by proxy in Africa (particularly in the Congo) or the fact that Saudi Arabia, just about the most repressive country on earth, only exists due to American sponsorship.  



TheBigShort said:


> Seriously, the call was for an honest debate. Next you will be telling me that China is one of the world's biggest polluters because the communist government controls the people, and then tell me that China is great example of a country abandoning socialism and adopting capitalism


China is actually a great example; they are making a massive shift to Green and they are doing so because of pressure from their people who have more of a voice than ever due to their economic power.



TheBigShort said:


> Next you will be telling me that the increase in carbon emissions into the environment over last 50yrs has more to do with state controlled command economies rather than increasing economic activity associated with open markets.


 Were you ever in Eastern Europe before or shortly after the fall of the Berlin Wall? I was in Romania then and again a few years ago. The change is remarkable.



TheBigShort said:


> What would you propose?


 Financial transaction taxes, patent royalty taxes, that sort of thing. They could only be brought in as part of an international agreement though. 
Maybe just get trans-national corporations to pay the taxes they are meant to pay now. 
Taxing the hell out of individuals or utter nonsense like maximum incomes it utterly wrong headed though.


----------



## TheBigShort (2 Oct 2017)

Purple said:


> Do you really think that Ireland, with the most "progressive" income taxation system in the developed world and 20% of the population living on welfare, is "ideological wedded to the concept of free market capitalist system"?



No I don't. It is not a free market system, it is cronyism and it is under the control of the banking system and its cheerleaders in government and the top of industry.
Those in control of this system, are the cheerleaders purporting to support a free market system.
It is not a free market system, you know it isn't, I know it isn't, we both know that a free market system is unattainable.



Purple said:


> So you think that the USA should have invaded mainland Japan and cost a vast multiple of Japanese lives?



You have me there. Atomic bombs on populated cities avoided all that!
You are missing the point, it is not about the US, if it wasn't the US with all this power, some other nation would strive for military control. Regardless the who is the superpower, the US, the Soviets, the Chinese, the Nazi's etc all would use their military might to inflict tyranny on others who they see as threatening their dominance. 
This occurs because of the economic system that engineered as it currently is, will ensure that the motives to profit will be accompanied by plunder.



Purple said:


> Financial transaction taxes, patent royalty taxes, that sort of thing.



Yes I agree.



Purple said:


> Maybe just get trans-national corporations to pay the taxes they are meant to pay now.



Agree.



Purple said:


> Taxing the hell out of individuals or utter nonsense like maximum incomes it utterly wrong headed though.



Maximum income as I proposed would only affect 1 in 80,000 people so by no measure could it be construed as taxing the he'll out of anyone.
Nevertheless I have already acknowledged that it would have zero support on this site so no point in exploring it further here.
The point is across a broad spectrum of academics and politicians from right to left, there is acknowledgement that the capitalist system as It is currently engineered is not sustainable.


----------



## Firefly (2 Oct 2017)

Firefly said:


> Of course when knocking something it is always reasonable to ask what the alternatives are and how these alternatives might be better. The alternative to capitalism, which has lifted millions out of poverty, is a socialist/communist utopia which has only ever resulted in tyranny, corruption and poverty for the man on the street. Luckily for us here in Ireland the people who advocate such a system are, rightly, in a tiny minority.



Just to add to this point, when knocking one ideology it is only right to look at the alternative. Anyone with even half a brain would agree that the opposite to capitalism is a melting pot of socialism/communism. We could be here all day evaluating various socialists views on which type of socialism they would like, but to see what _actually _happens / happened when states declare themselves we can turn to various lists such as:

https://en.wikipedia.org/wiki/List_of_socialist_states

Take a look at that list and ask yourself if you would even visit any of these countries never mind live there! The exception of course is China which has seen a near miraculous transformation since it opened up to free trade.

In addition, lists such as those below show the world's wealthiest countries. I note a distinct lack of absense from the red countries in the list above!

https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

http://www.worldatlas.com/articles/the-richest-countries-in-the-world.html
http://uk.businessinsider.com/the-r...17-3/#29-finland-gdp-per-capita-41812-34114-2
https://www.gfmag.com/global-data/economic-data/richest-countries-in-the-world?page=12


So yes, capitalism is not perfect and has its faults, but hey, it's a 1,000,000 times better than the alternative!


----------



## Brendan Burgess (2 Oct 2017)

As this has descended into abuse, I have closed the thread.


----------

