Fed buys $1T of Treasury, mortgage assets

[MetKiller Joe]

I thought rossmum meant that the Australian gov't will establish this legislation, which didn't make sense, why would you disincentivize work?

I know about the legislation for bonuses here in the US; I don't necessarily agree with it, but, as I said before, I don't really see why giving out money to banks is necessary in the first place if nobody wants to loan right now.

Metkiller, did you actually watch that video? It basically ripped the idea to shreds.

Which idea? The point of the video is that government deficit spending doesn't fix recessions, it makes them worse.

[rossmum]

I thought rossmum said that the Australian gov't will establish this legislation, which didn't make sense, why would you disincentivize work?

That's precisely what I said, considering Pacific Brands just laid off thousands and outsourced while all the profits of this went straight to their CEO...

Kevin Rudd gets $300,000 a year for running the country. These lot shouldn't get ten times that just for signing all their work out to underlings and appearing at a few conferences.

[Limited]

Metkiller, its about cash flow. Not who has it at any point in time.

OT, loving the tags for the thread.

[Phopojijo]

The Government should keep their nose out of it. They are the reason the Economy is the way it is.

Uhm...

No.

No the reason we're where we are now... is because the Government didn't pay enough attention.

Trillions of dollars don't disappear if the Government actually kept track of it.

In fact... the United States is closest to the Laissez-Faire (hands off... let it be) style of government... and of course the United States was hit hardest by this economy collapse.

Up here in Canada with more regulation -- our housing market is fine except for like -- Vancouver, Calgary, Edmonton, and Toronto. For instance -- our house is worth more now than when we bought it 4 years ago.

Sooo maybe you should be more like Canada and not let the corps walk on you.

[MetKiller Joe]

Metkiller, its about cash flow. Not who has it at any point in time.

OT, loving the tags for the thread.

Limited, when the government puts money into the economy, where does it get that money? I think 700 Billion dollars being transfered has a lot to do with cash flows.

I'll say it again:

People demand loans when they want to invest in capital assets or in expensive durable goods. The housing market is down, car dealerships are shutting down, and retail markets for things big and small are closing. That leaves out capital assets, but, unfortunately, most investors are now either investing in commodities, or buying US bonds because they are so cheap (Europe); they could be also just keeping that money.

The banks aren't giving out loans because people aren't demanding them. I've heard commercials on the local radio from Bank of America and CitiGroup basically telling me "Loan our money!" Which tells me that they are in dire straits right now.

I'll add: What use does taking 700 Billion dollars worth of funds from the market do when you are giving it to the very people that started the mess? Nobody is demanding loans, which makes, in my opinion, any debate over the usefulness moot.

You are taking 700 Billion dollars which could have been spent on real capital assets or saved or invested in projects all over the world (Africa is not getting as much financial aid from nations because all of that money is going toward buying dirt cheap US bonds), and you are giving it people who will just let it sit in their vaults.

[Limited]

Where does it get the money?
Where does the money go?
Will be money ever reach civilians pockets?

All valid questions.

The reason I said cash flow is because up until now, the flow of cash has been stopped half circle.

[MetKiller Joe]

Where does it get the money?
Where does the money go?
Will be money ever reach civilians pockets?

1) Bonds, its citizens, foreign loans
2) To banks and other such organizations
3) If they loan the money yes, if not, no.

[Limited]

Well I didnt actually mean you do answer them, I'm saying before any action is taken the government and other responsible establishments need to consider them and take into account what the future may hold.

There is no easy answer, no easy way out. It will get harder before it gets better, we will go through a stalemate time when we will just need to ride it out and let time take its course.

[Phopojijo]

1) Bonds, its citizens, foreign loans
2) To banks and other such organizations
3) If they loan the money yes, if not, no.

You realize that's a problem... right?

[MetKiller Joe]

You realize that's a problem... right?

I feel like I'm repeating myself:

I'll say it again:

People demand loans when they want to invest in capital assets or in expensive durable goods. The housing market is down, car dealerships are shutting down, and retail markets for things big and small are closing. That leaves out capital assets, but, unfortunately, most investors are now either investing in commodities, or buying US bonds because they are so cheap (Europe); they could be also just keeping that money.

The banks aren't giving out loans because people aren't demanding them. I've heard commercials on the local radio from Bank of America and CitiGroup basically telling me "Loan our money!" Which tells me that they are in dire straits right now.

I'll add: What use does taking 700 Billion dollars worth of funds from the market do when you are giving it to the very people that started the mess? Nobody is demanding loans, which makes, in my opinion, any debate over the usefulness moot.

You are taking 700 Billion dollars which could have been spent on real capital assets or saved or invested in projects all over the world (Africa is not getting as much financial aid from nations because all of that money is going toward buying dirt cheap US bonds), and you are giving it people who will just let it sit in their vaults.