the economic reset button
Discussion
I'd mused post 2008 about the need to hit the economic reset button - let's just wipe out all debt and start again.
Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
TheFungle said:
I'd mused post 2008 about the need to hit the economic reset button - let's just wipe out all debt and start again.
Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
Don't know enough about the realities of making something like that work. Suspect it would need global approval and I doubt we've done enough on it to (at this point) consider it as a serious Plan B, or even C.Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
Having said that, something of that magnitude will undoubtedly be required at some point on our timeline.
Maybe now's the time; it's certainly (or will be) a fully global event. Interesting.
Great. The prudent pay again.
And the debts were at least in some part provided by investors who will now not get interest payments or their capital back?
To me it sounds like a great ‘idea’ but it’s a terrible idea because it’s the ultimate bail-out, and we know those always result in worse s
t down the road.
What we need are sustainable economies that are not based on debt and inflation.
We won’t get to that until we learn the lessons to get us out of the mess we’re in.
Just doing a ‘cheat’ like kids playing Monopoly won’t provide us with the lessons and experience to see us not just keep failing for the same reasons again and again.
And the debts were at least in some part provided by investors who will now not get interest payments or their capital back?
To me it sounds like a great ‘idea’ but it’s a terrible idea because it’s the ultimate bail-out, and we know those always result in worse s
t down the road.What we need are sustainable economies that are not based on debt and inflation.
We won’t get to that until we learn the lessons to get us out of the mess we’re in.
Just doing a ‘cheat’ like kids playing Monopoly won’t provide us with the lessons and experience to see us not just keep failing for the same reasons again and again.
Bottom line is, it would hardly be fair. People/businesses who have look after the pennies V's credited up to the eyeballs living a fake dream on money they don't have.
And what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
And what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
Dr Doofenshmirtz said:
Bottom line is, it would hardly be fair. People/businesses who have look after the pennies V's credited up to the eyeballs living a fake dream on money they don't have.
And what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
fAnd what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
k my life then fk it all over again.This isn't about wiping out the debts of the PH cliche of those who have bought the latest iPhone or 42" Plasma (hello 2009).
This is about families and businesses who in any other circumstance are managing their money but now face a once in a century event.
Please enlighten me - do you think it's right that individual's, businesses and nations should go under because of this unprecedented (in our lifetime) situation?
TheFungle said:
I'd mused post 2008 about the need to hit the economic reset button - let's just wipe out all debt and start again.
Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
So the shopper does not have to pay their credit card bill, the credit card company do not have to pay the shopkeeper their money, the shopkeeper does not have to pay the money he owes to the sausage supplier, the supplier does not have to pay what he owes to the pig farmer and everyone has nothing? Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
Where would they all get money to buy other things from and why would they continue making their products?
greygoose said:
TheFungle said:
I'd mused post 2008 about the need to hit the economic reset button - let's just wipe out all debt and start again.
Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
So the shopper does not have to pay their credit card bill, the credit card company do not have to pay the shopkeeper their money, the shopkeeper does not have to pay the money he owes to the sausage supplier, the supplier does not have to pay what he owes to the pig farmer and everyone has nothing? Given Coranavirus is affecting everyone and draining bank accounts big & small; why not simply reset?
After all, money is simply a digital figure on a computer.
What reason is there to not do this?
Where would they all get money to buy other things from and why would they continue making their products?
It's not hard to imagine a scenario where a household no longer has any income; how do you propose they pay the mortgage, car loan and food bills?
Overnight and out of nowhere people are losing their incomes. Not because of poor decisions or lack of financial nous but because of a virus.
Why not hit reset?
The successful will continue to make money, the average will continue to make money and the feckless will continue to accrue debt and pay back the interest.
TheFungle said:
Dr Doofenshmirtz said:
Bottom line is, it would hardly be fair. People/businesses who have look after the pennies V's credited up to the eyeballs living a fake dream on money they don't have.
And what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
fAnd what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
k my life then fk it all over again.This isn't about wiping out the debts of the PH cliche of those who have bought the latest iPhone or 42" Plasma (hello 2009).
This is about families and businesses who in any other circumstance are managing their money but now face a once in a century event.
Please enlighten me - do you think it's right that individual's, businesses and nations should go under because of this unprecedented (in our lifetime) situation?
I really don't think it would be fair for the prudent to bail out the less than prudent...but who knows what'll happen.
Governments can wipe their debts clean. Apart from nobody would lend to them again. However, if the whole G20 wipes their debt clean then this would be neutered. I do see the major economies all using this as a reason to reset the global economy. I expect they already know this which is why they are all throwing the kitchen sink at it, there is simply no number too big right now. I have no fear of tax rises after this as they would be unsustainable when this is over.
The fact is there won’t be a global economy if this isn’t fixed quickly. We could have a banking crash, as well, all it takes is for everyone to realise what BS the whole of globalisation actually is and the whole house of cards could fall over. Money is nothing more than an IOU at the en for the day and the whole concept of money could change after this.
The fact is there won’t be a global economy if this isn’t fixed quickly. We could have a banking crash, as well, all it takes is for everyone to realise what BS the whole of globalisation actually is and the whole house of cards could fall over. Money is nothing more than an IOU at the en for the day and the whole concept of money could change after this.
Dr Doofenshmirtz said:
TheFungle said:
Dr Doofenshmirtz said:
Bottom line is, it would hardly be fair. People/businesses who have look after the pennies V's credited up to the eyeballs living a fake dream on money they don't have.
And what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
fAnd what about all those car loans for German saloons? They'd all be effectively given away free.
No. I hope that doesn't happen.
k my life then fk it all over again.This isn't about wiping out the debts of the PH cliche of those who have bought the latest iPhone or 42" Plasma (hello 2009).
This is about families and businesses who in any other circumstance are managing their money but now face a once in a century event.
Please enlighten me - do you think it's right that individual's, businesses and nations should go under because of this unprecedented (in our lifetime) situation?
I really don't think it would be fair for the prudent to bail out the less than prudent...but who knows what'll happen.
Should a business or household have enough cash to survive 3 months with no income? 6 months?
TheFungle said:
I'm genuinely curious - what do you define as prudent?
Should a business or household have enough cash to survive 3 months with no income? 6 months?
However you define prudent, if the debts are all reset, you are unlikely to ever see it in any version again in the future aren't you? How can you reset and then say "but don't do it again"?Should a business or household have enough cash to survive 3 months with no income? 6 months?
Unless perhaps following this we go to tighter (prudent!) lending
Cold said:
Why do so many people want to take my money and give it to someone else without bothering to ask me first?
What money is the government taking from you?Perhaps you feel millions of people should have their lives destroyed so that you can buy their reprocessed house cheaply.
Crippo said:
What money is the government taking from you?
Perhaps you feel millions of people should have their lives destroyed so that you can buy their reprocessed house cheaply.
The government's financial demands of me are clear and very transparent. I even get the chance to vote on whether I am happy with this arrangement every so often. However, I'm unclear as to why I should be made to hand over more based solely on the whim of a few think-tank geniuses.Perhaps you feel millions of people should have their lives destroyed so that you can buy their reprocessed house cheaply.
I have no desire for a reprocessed house. It sounds rather cleansed.
Cold said:
The government's financial demands of me are clear and very transparent. I even get the chance to vote on whether I am happy with this arrangement every so often. However, I'm unclear as to why I should be made to hand over more based solely on the whim of a few think-tank geniuses.
I have no desire for a reprocessed house. It sounds rather cleansed.
Are you just talking about general taxation as a principle for running society? Or is this connected to the current crisis?I have no desire for a reprocessed house. It sounds rather cleansed.
Crippo said:
Governments can wipe their debts clean. Apart from nobody would lend to them again.
Wrong.Governments fail to pay their debts regularly, that fact is priced into the bond yield.
When they default, its usually just a matter of days before people are buying their bonds again gambling that they will get their money back before the next default happens. They take that gamble because the yield is high.
The Euro fooked this mechanism up in the Eurozone area, you saw it cracking in 2009/10 before Draghi gave his "we will do whatever it takes" speach.
That strapline should sound familiar to you this week.
Crippo said:
Are you just talking about general taxation as a principle for running society? Or is this connected to the current crisis?
What? Why are you fixated on taxation? That hasn't been brought up except by you and your presumption that those who are able to ride the storm will suddenly turn into vultures and must be preemptively punished. The premise of the thread seems to be rich/comfortable=bad and must be adjusted for the greater good.
Corbyn lost.
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