GRITtv: Dean Baker: What Went Wrong With The Economy

Dean Baker explains in basic terms why the economy collapsed.
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Category:

News & Politics

Tags:

• grittv
• grit tv
• laura flanders
• dean baker
• economy
• bubble
• housing

[jjrglobal]

@rspawn

Thats the most ignorant explanation about economics that I've ever read. You win the retard award

[rspawn]

"American wages need to increase in order to meet the expectations (the demands) of a thriving economy and greedy bankers."

But higher wages reduce profits, and it very much looks like greedy bankers' expectations can be met by the system as it currently is. So that's why workers' wages continue to decline.

[DojoNDude]

So, in other words, we have a pretend economy that might work if American's actually made enough money to pay their mortgages. And the economy was roaring along in any event. So, it seems to me, That American wages need to increase in order to meet the expectations (the demands) of a thriving economy and greedy bankers. Maybe the FED should start bailing out American's with an income supplement. It all winds up with the bankers anyway.

[rspawn]

The housing bubble money didn't really disappear; (at leats part of) it changed hands from home owners and taxpayers to the banks (the bail-out/tarp thing).

So in a way the bubble was kept alive, because without the (not-backed up) value it represents the economy would have collapsed (so goes the official reasoning). Which means the economic system is such that its existence depends on bubbles. In other words the economy is hooked on toxic assets.