Who should give in? Topic

bad_luck
Posts: 21761 (0)
Hall of Famer
48 1 10
Prospect
Posted by swamphawk22 on 3/20/2013 5:27:00 PM (view original):
You still seem to view the economy as infinite.

If we keep borrowing that ties up a part of the economy.

You can argue if that makes the economy sluggish, but you cannot argue that there is only so much money. We are not priniting money out of the blue, we are borrowing it from someone else.
That's the point. We're borrowing money that would otherwise be sitting still in a savings account or CD. Even if the government is wasteful and inefficient, wasteful and inefficient spending is better (for the economy when demand is depressed) than no spending.
3/21/2013 11:23 AM
swamphawk22
Posts: 13021 (0)
Hall of Famer
9 4 8 3 84 113 36
Prospect
Finance 101.

You put your money in a CD.

The group that offers the CD pays you.

They need to invest that money somewhere or they lose money.

It doesnt just sit there.
3/21/2013 11:28 AM
bad_luck
Posts: 21761 (0)
Hall of Famer
48 1 10
Prospect
Posted by swamphawk22 on 3/21/2013 11:28:00 AM (view original):
Finance 101.

You put your money in a CD.

The group that offers the CD pays you.

They need to invest that money somewhere or they lose money.

It doesnt just sit there.
If there was some shortage of capital, I'd agree with you. But we had the exact opposite. Public companies and banks were flush with cash. They just didn't have a reason to spend it because of the depressed demand.
3/21/2013 12:13 PM
swamphawk22
Posts: 13021 (0)
Hall of Famer
9 4 8 3 84 113 36
Prospect
Again if you have cash in the bank you are making money.

The bank is losing money.

They need to invest.

So if there were no bonds they would need to create markets.
3/21/2013 1:46 PM
bad_luck
Posts: 21761 (0)
Hall of Famer
48 1 10
Prospect
Posted by swamphawk22 on 3/21/2013 1:46:00 PM (view original):
Again if you have cash in the bank you are making money.

The bank is losing money.

They need to invest.

So if there were no bonds they would need to create markets.
Not necessarily. My regular bank savings account pays .01% interest. Banks get more than that from the Fed on their reserves.
3/21/2013 2:12 PM
swamphawk22
Posts: 13021 (0)
Hall of Famer
9 4 8 3 84 113 36
Prospect
I think you mean 1%, but that still represents money that isnt being made.
3/23/2013 1:12 PM
bad_luck
Posts: 21761 (0)
Hall of Famer
48 1 10
Prospect
Posted by swamphawk22 on 3/23/2013 1:12:00 PM (view original):
I think you mean 1%, but that still represents money that isnt being made.
No, I mean .01%. Rates aren't higher because banks are flush with capital.
3/25/2013 10:26 AM
swamphawk22
Posts: 13021 (0)
Hall of Famer
9 4 8 3 84 113 36
Prospect
your return is either 0.01 or 1%.
3/28/2013 4:07 PM
bad_luck
Posts: 21761 (0)
Hall of Famer
48 1 10
Prospect
Posted by swamphawk22 on 3/28/2013 4:07:00 PM (view original):
your return is either 0.01 or 1%.
No. The actual rate of the regular savings account that I have is 0.01%.

Not a typo.

I have a CD with AIG that pays 1.05% but it has a $10,000 minimum and I can't touch the money for a specified period of time.
3/28/2013 6:52 PM
◂ Prev 1...12|13|14
Who should give in? Topic
△Top△Bottom

Search Criteria

Terms of Use Customer Support Privacy Statement

© 1999-2024 WhatIfSports.com, Inc. All rights reserved. WhatIfSports is a trademark of WhatIfSports.com, Inc. SimLeague, SimMatchup and iSimNow are trademarks or registered trademarks of Electronic Arts, Inc. Used under license. The names of actual companies and products mentioned herein may be the trademarks of their respective owners.