Milton Friedman on Bailouts

[solmyrgarde]

Government "should" keep its people happy and wealthy, which it isn't. Oh well.

[Foreshadow44]

I'm a Chase member too, point is I'm insured so if they go out of business I won't lose anything and someone will simply take their place. hence, they should go under if they play the gambling game they involved themselves in. I had BoA and dropped them to switch to Chase and if chase went under or treated me like BoA I would drop them too so they need to treat me according to a level of commitment and service as Chase says "The right relationship is everything" and so I hold them to that.

[zed6952]

Donahue is not a douche. He is a television presenter playing the devil's advocate. If Donahue were, in fact, a douche, he would not give credence to Friedman's ideas nor allow him a forum from which to present his ideas.

[USAHavana]

@1963danno Yeah, Donahue and Obama are more like ignorant scumbags, in Donahues case, Freidman was a douche in highlighting just how STUPID Donahue and his ilk really are. I see why you are so upset.

[USAHavana]

@1963danno I know, Donahue and Obama are both major douche bags.

[saleh2kx]

Donahue dint get that profit and losses on the first take.. Had to make sure he go it.. That just shows you how advanced Milton's mind is.. he another league.. Average folks like us need a replay, a second look to get what he said. And Obama set America Up.. Bush's 3rd term

[fountainherz]

People forget when asking "should the government bail out X" that "the government" = our money.

The question should be more properly worded "should the taxpayers have their taxmoney go towards bailing out X"

[poidog44]

@fountainherz Or should the tax payers have their money go toward fighting wars?

I say no.

[jdis]

how relevant they were talking about chrylser. at that time it wasn't bailout that saved chrysler it was free-market changes in the form of lee iacoca and the company doing some cleaning-house.

[YourUTubeMonitor]

The Rockefeller Foundation's Anglo-American Alliance is deeply engrained in the American psyche. Wendell Willkie, who never held elective office (as he maintained all the attributes of a dog except faithfulness), was a New World Order collectivist. This abominable critter wrote "One World," in 1943, which advocated the end of U.S. sovereignty for the betterment of Mankind. Willkie railed against F.D.R. and the New Deal while he worked for F.D.R. to further the Marxian goals of the New Deal.

[CarMoves]

Obama?

I guess everyone has forgotten that BUSH started the bailouts with TARP.

[grecorivera941]

@CarMoves I havn't forgotten but Obama campaigned on the fact that wall street was to blame for our current woes and that he was going to bring change and he turns around and appoints, Bernanke, Tim Geihtner, larry Summers as the head of the Fed, treasury and as an economic adviser. The movie Inside Job really exposed Obomas complete lack of political will to challenge the established financial hierarchy.

[kriskats19]

@CarMoves No we didn't forget... We remember that Obama promised change, and he is exactly the same as Bush on bailing people out. Time to replace him.

[kriskats19]

@CarMoves I didn't forget that... I remember Obama promising change, and now he is exactly the same as Bush bailing people out, keeping open Gitmo, keeping the Patriot act in place, and starting illegal wars (Libya). Time to replace him.

[poidog44]

@kriskats19 You may want to research the Libya "war".

[anna2bad4]

@CarMoves That was actually Henry Paulson`s idea, Bush just went along with it!

[madscientistify]

@CarMovesdamn right! these youtube republican trolls never cease to amaze me

[kriskats19]

@madscientistify Go ahead and call names all you want. You liberals have to do that because your ideas don't work or make sense.

[Playboysmurf1]

Obama needs to revise this video.

[orbithesun1]

I have a man crush on Milton Friedman!

[USAHavana]

@orbithesun1 SO DO I!! A major man crush, he is a true hero! With integrity, wit, intelligence and common scense. Something so lacking today. Now we blame streets in NYC. Whats next, "blame Canada", this is getting like South Park.

[travz21]

Instead of the free market forcing these failing companies to either make the necessary changes to become profitable or go bankrupt, the government bails them out, which encourages bad business in the future. When there is no risk of losing money from running a poor business, the business has no reason to try and compete.

[asianpsuation]

@travz21 what's remarkable, is that the phenomenon of moral hazard you just described, it's basic market economics supported by empirical evidence and logical reasoning. That some try to persuade you otherwise using fantastically complicated arguments, formulas, and rationals shows that they are almost certainly incorrect. Occams razor should have prevailed, but once again we bought the lie...and the same low lending standards promoted by the fed mid decade still exist to create another bubble

[oshory]

Capitalism is about profit and loss, if you bail out the losers there's no end to the cost.

[OhmgrownCron]

This was when? And did chrysler not go bankrupt? Milton must have been tired of saying the same thing over and over again

[Foreshadow44]

Thus AIG should have failed, Chase and BoA should have also. I had accounts with all three. The company would have ceased to exist but the retirement account and my less than 100k bank accounts would have remain solvent and the bail out money would have essentially bailed the small guys who earned that money and kept it with those large banks. All the bank employees would have lost their job and no bonuses paid. Criminal investigations would have followed.

[listonanymous]

@Foreshadow44 Right, but Chase, BoA, Lehman and the rest wouldn't have acted in the same way if they didn't have the confidence that our government would bail them out if anything went horribly wrong (presumably). Maybe we never would have seen the gross proliferation of MBS if it weren't for the confidence that the banks had in our government to do whatever it takes.

[Romansteel13]

@Foreshadow44

"Thus AIG should have failed, Chase and BoA "

BoA is dead in the water.

AIG was the largest insurer at the time.

Chase was the first out of the 9 mega banks to pay back their TARP loans.

Chase is also the largest bank in the world.

I am proud to be a card carrying Chase Member.

[poidog44]

@Foreshadow44 Actually, he believed banks should have been bailed out during the great depression.

[Foreshadow44]

I wonder what phil donahue thinks of Milton today. I think that would be a good thing to ask Phil today in 2011. I agree with Milton. No bailout, and that especially goes for large banks. Let them eat that debt but the portion of the investment that is attached to retirement accounts for people like state workers and teachers who didn't invest that money it was done without their knowledge or say so. The government lets the bank fail but that small portion they seize and save it.

[Iammram]

@Chaicoffski

How is it different, or was, in 2008? How would it have been destructive?

[AisAbsolute]

Great point about the function of loss in a free market.

[Jaiyo17]

Legend.

[izadk]

Wonder what Milton Friedman will say today?

This man is rolling in his grave after what this government has done in recent years.

This government has done everything to protect poorly managed and operated companies on expense of tax payers. Protecting these enterprises, creates no incentive for improvement and creates less competition in a free market. Government involvement is the number one reason for market failure.

As he stated, loss is as important in a market as profit.

[nikolayzou]

Great Man.