Reue's Pension FAQ

I tend to agree. I think their driving issue is to keep the housing market from collapsing. They seem to be desperate to foster inflation - because that makes the money they've borrowed [by selling government bonds for one thing] much cheaper to repay. In order to 'buy' votes, they have held interest rates artificially low. When they changed loan qualification, [driven in part by the woman's lib lobby], they altered things so that you had to consider the woman's salary too. I knew a young couple who dearly wanted a house, but could not qualify for a loan. They just barely missed qualification. Right in the middle of this, they changed the qualification rules. They were overjoyed... oh, NOW they COULD qualify. Well - surprise - house prices took a moderate jump, because now people could borrow more money. And [guess what], they STILL couldn't qualify, because they had to borrow more money to cover the increased price.

Much of the population here is 'stretched tight' trying to pay for cars (with big loans on them), as well as their housing (with even bigger loans on them). They are stretched tight with 2% to 3% interest rates on the loans - which are (as i said above), artificially low. If they were to raise interest rates to a more realistic 5% to 8% rate - which they were for many years after WW2, many people would default, because they couldn't come up with the extra money they would need to make the house payment at the higher interest rate. The effect of the low interest rate, is to discourage saving. Why put money in a savings account or CD, if you're only going to get 2% on it. So those few ppl with extra cash, put it in money markets or mutual funds.

I used to work for the Federal Government, and i'm not naive enough to think that most (or even many) of the Feds have any idea what they're doing - when it comes to fiscal management. They certainly had no idea what they were doing in communications engineering, why should it be different for economics?? I do think that they marginally have enough sense to realize that having the housing market crash - due to a slew of loan defaults - and the price drop that would follow that, as the banks tried to recover some of the money they had tied up in overpriced homes, would NOT be good for the political business.

The only thing that keeps the financial markets working at all, is the illusion of 'confidence'. If a crisis of confidence occurs, as it did briefly when Lehman Brothers went down, and the same for the Long Term Capital Management crash, the financial house of cards that has been built up - may collapse. In that case, 1929 may look like a tea party. Best of luck to all of us!! Cheers.

So you want the government to have more control? Or do you want a 1929 collapse?

Posted from TSR Mobile

The alternatives are not: A> government has total control over the economy, or B> total financial collapse. The best economic situation is where you have a 'free market economy'. Roosevelt extended the depression by at least 5 years with his 'tinkering' with the economy. One of the 'brilliant' schemes they came up (under the guise of 'price support' was destroying perfectly good food stocks, while many people were finding it hard to get enough to eat. Left to itself, the 1929 crash would have lasted less than 3 years. As it was, it took WW2 to finally pull the world out of the mess that the 'managers' created.

Want to see a 'managed' economy - look at Soviet Russia. Everything centrally planned by committee. Compare the living standards in East Germany with the west. Compare North Korea with the South. Look at Venezuela. No tenemos dinero, no tenemos trabajo, no tenemos comida, pero tenomos Maduro!!

There are quite a few books that revisit Roosevelt's policies taken after his first election. Most of them came from his predecessor. They re-packaged Republican policies, and labeled them Democratic. WIth neither label were they helpful or successful. A few programs, such as the CCC, did have some beneficial effect - mainly because they significantly increased the educational level of the rural population - which was a good preparation for WW2. Prior to WW2, about 80%+ of the population lived on farms, and wasn't very well educated.

So they are incompetent at controlling the housing market? In which case they aren't controlling it...

Posted from TSR Mobile

Can you name the part of the housing system they don’t control?

My decision to buy my current home 20 years ago.

That’s not the housing system that’s an individuals choice which is rapidly a decision that young people can no longer make.

Care to give an actual response on the housing system to my question?

Thousands of similar decisions every day *are* the housing system.

Can you name the part of the housing system they don’t control?

Just because they are incompetent at looking after the housing needs of their citizens doesn’t mean they don’t control every facet of the market.

Having worked for the Fed Govt for about 15 years some time ago, i feel i have some insight into how government "control" works.

Basically, the people i was working with, were tasked with managing communications engineering. They really weren't competent to do that. EVERYTHING that was done, that was at all helpful, was done at the so called "working level" - i.e. the lowest level. The 'managers' - even the branch chiefs (which was one level up from the working level) couldn't find the men's room without help. When you got them there, you had to show them what to do.

As an example: One of my tasks was doing an install of a comm system at a FAA facility in West Virginia. A new building had been built to house the comm system, next to an existing FAA building. A generator was to be bought to support both buildings, and it was to be wired into both of them. In the states, all commercial buildings are equipped with "3 phase" power. Residences are almost always single phase. The FAA manager on this project, insisted that the control panel be wired single phase. I objected, stating that the existing building was certainly 3 phase, and the new one would be also. Also, the generator being bought was alwo wired 3 phase. He was undeterred. He INSISTED that everything be re-wired to fit his 'pre-conceived' truths.

This incurred an additional month of time added to a project that was already late, to say nothing of increased cost. At long last, the generator, control panel, and associated equipment was delivered to West Virginia. Then, surprise..surprise!! Both buildings were wired 3 phase, so the new generator could not be connected!! Everything had to be re-re-rewired to put it back to 3 phase again. This involved another month worth of work - at a very remote location. Another month was added to the delivery sechedule (making 2 months so far), plus about $30,000 of increased costs. I saw this time and time again. They hire technically trained personnel [who at the 'working level' are generally fairly competent]. The "managers" then over-ride the technical decisions being made by their 'hired help' - and run up very considerable extra expenses and increased time delays. And they NEVER seem to learn from their mistakes - NEVER!!!

Having seen this for most of my working career - i seriously doubt that any 'government' program is much different. The un educated and un-initiated obsess over government 'cabals' and highly sophisticated plans to pervert everything. In reality, they are lucky if they can find their way home at the end of the workday. Cheers.

In other words, there's no government conspiracy...

Posted from TSR Mobile

Exactly! In my experience, they couldn't avoid fouling up a free lunch!!!

Can you name the part of the housing system they don’t control?

Just because they are incompetent at looking after the housing needs of their citizens doesn’t mean they don’t control every facet of the market.

House building?
House finance?