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The Great Depression - Can It Happen Again? (5min.)

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  • #1

    The Great Depression - Can It Happen Again? (5min.)

    "Main role of gold in the monetary system: Gold is the only asset that can successfully compete with government bonds for the savings of people with a conservative frame of mind" - Fekete

    "Worse of all, we lack leadership" - Fekete

    "[leaders]...they grew up on Friedman and Keynesian bunk" - Fekete





    This appears to be the trailer of a 90 min. documentary film at the Economic club of SF on Nov. 4, 2008. See amazon link here for the interested:
    http://www.amazon.com/Economic-Club-...0964675&sr=8-1


    More about Dr. Fekete:
    http://www.professorfekete.com/


    Fekete's paper about banks and accounting is not a bad read (also attached as pdf):
    http://www.professorfekete.com/artic...anceSheets.pdf


    I do not understand Fekete's comment about "vanishing of capital" being the cause for depression (see at 0:40). Anyone gets it?

    -W.
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  • #2
    Re: The Great Depression - Can It Happen Again? (5min.)

    Originally posted by LargoWinch View Post
    "Main role of gold in the monetary system: Gold is the only asset that can successfully compete with government bonds for the savings of people with a conservative frame of mind" - Fekete


    "Worse of all, we lack leadership" - Fekete

    "[leaders]...they grew up on Friedman and Keynesian bunk" - Fekete


    &nbsp



    This appears to be the trailer of a 90 min. documentary film at the Economic club of SF on Nov. 4, 2008. See amazon link here for the interested:
    http://www.amazon.com/Economic-Club-...0964675&sr=8-1


    More about Dr. Fekete:
    http://www.professorfekete.com/


    Fekete's paper about banks and accounting is not a bad read (also attached as pdf):
    http://www.professorfekete.com/artic...anceSheets.pdf


    I do not understand Fekete's comment about "vanishing of capital" being the cause for depression (see at 0:40). Anyone gets it?

    -W.

    I had a whole discussion about that in this thread. Good luck.

    http://www.itulip.com/forums/showthr...ghlight=fekete

    Comment

    • #3
      Re: The Great Depression - Can It Happen Again? (5min.)

      The vanishing of capital thesis puts him in the Roubini/Keene camp of seeing it as a solvency/debt issue.
      It's Economics vs Thermodynamics. Thermodynamics wins.

      Comment

      • #4
        Re: The Great Depression - Can It Happen Again? (5min.)

        We are certainly in uncharted territory, that said Americans have show time and time again, that they have the will to pull through. Just like momma always said, "What does not kill us, only makes us stronger."

        Comment

        • #5
          Re: The Great Depression - Can It Happen Again? (5min.)

          Originally posted by *T* View Post
          The vanishing of capital thesis puts him in the Roubini/Keene camp of seeing it as a solvency/debt issue.

          I'm still trying to get my small mind around this idea of his:

          "Capial destruction has been going on for 28 years but the banks were not paying attention. The banks have been paying out phantom profits in dividends in the beleif that their capital accounts were in good shape. They were not. They were insidiously eroded by the falling interest rate structure."

          Comment

          • #6
            Re: The Great Depression - Can It Happen Again? (5min.)

            Originally posted by ewrealty View Post
            What does not kill us, only makes us stronger.
            Your mamma was Neitzsche? :eek::p
            It's Economics vs Thermodynamics. Thermodynamics wins.

            Comment

            • #7
              Re: The Great Depression - Can It Happen Again? (5min.)

              Originally posted by cjppjc View Post
              I'm still trying to get my small mind around this idea of his:

              "Capial destruction has been going on for 28 years but the banks were not paying attention. The banks have been paying out phantom profits in dividends in the beleif that their capital accounts were in good shape. They were not. They were insidiously eroded by the falling interest rate structure."
              See the thread I referenced above. His idea is basically that lower interest rates increase the liquidation value of fixed-rate debt. Eg a bond is more expensive to buy if rates go down. Not sure it's the answer to everything though. But I do agree stable interest rates are good, more important than low interest rates.
              It's Economics vs Thermodynamics. Thermodynamics wins.

              Comment

              • #8
                Re: The Great Depression - Can It Happen Again? (5min.)

                Originally posted by *T* View Post
                See the thread I referenced above. His idea is basically that lower interest rates increase the liquidation value of fixed-rate debt. Eg a bond is more expensive to buy if rates go down. Not sure it's the answer to everything though. But I do agree stable interest rates are good, more important than low interest rates.

                T. I am really greatfull for your continued efforts to help me with this. I think he is saying more than that. I just don't know what it is. It's possible he's wrong. That the profits were real, not phantom. You know a lot of smart horse people said you can't bet a filly in a big race against colts.

                Comment

                • #9
                  Re: The Great Depression - Can It Happen Again? (5min.)

                  Originally posted by *T* View Post
                  Your mamma was Neitzsche? :eek::p
                  lol! very funny!

                  Comment

                  • #10
                    Re: The Great Depression - Can It Happen Again? (5min.)

                    Originally posted by ewrealty View Post
                    We are certainly in uncharted territory, that said Americans have show time and time again, that they have the will to pull through. Just like momma always said, "What does not kill us, only makes us stronger."
                    Unfortunately, this applies to the government too.
                    медведь

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