Market Watch commentary piece: "Massive default is best way to fix the economy."

[dixiegrrrrl]

So, what do you think about this???

NEW YORK (MarketWatch) — You want to fix this economic crisis? You want to put people back to work? You want to light a fire under the economy?

There’s a way to do it. Fast. And relatively simple.

But you’re not going to like it. You’re not going to like it at all.

Default. A national Chapter 11 bankruptcy.

The fastest way to fix this mess is to see tens of millions of homeowners default on their mortgages and other debts, and millions more file for bankruptcy.
More...
http://www.marketwatch.com/story/massive-default-is-best-way-to-fix-the-economy-2011-09-12?pagenumber=1

Do take the time to look at the reasoning for his argument...

[Turbineguy]

1. Well maybe

but what about all the people who have unproductive jobs in the financial industry (including a large number of pundits)?

[bemildred]

2. He is quite correct, but it won't be at all pretty.

Catastrophic change can have its down side.

[ixion]

3. At this point, I don't think there's any pretty way to do it

it is just something that must be done.

[bemildred]

4. I would rather it was managed, I agree it must be done.

Bullshit will only take you so far. But our "leaders" seem to be addicted to bullshit these days.

[ixion]

7. Yep, agree. Managed would be better.

although the longer the leadership strings it out, the less manageable it's going to be, in my opinion.

[dixiegrrrrl]

6. We either choose do it or it chooses to do it to us.

And we missed a golden opportunity back in '08, even better one in 2001. It is is gonna cost us much more in many ways besides money when the inevitable happens.
More and more cracks are showing in the world financial facade even as I type.
Just looked at the DAX...ugggh.

[bemildred]

8. Yes.

I admit I am torn. I have watched these corrupt and incompetent weasels tearing the country down in the service of their own self-interest all of my adult life, so I want to see them get their comeuppance; yet I know that many people who had nothing to do with it, who have no power, will suffer too. It would be much better to just remove the rot and keep the rest of the political and economic apparatus working.

[dixiegrrrrl]

9. Any way to do that best scenario????

Besides importing guillotines?

[bemildred]

11. Well, there are examples, Iceland, Argentina.

Latin America is doing well with orderly reform, some of it. Scandinavia and Turkey have both handled themselves well, but that has been so for some time. I could probably come up with some others, but too lazy.

Whether we are up to that sort of thing yet, I doubt, we are too corrupt for it to come from the top (I think), and not sufficiently in the toilet for it to come from the bottom (yet).

The thing that disturbs me most is the apparent lack of clue at the top and total reliance on PR and propaganda to keep the lid on. Our leaders seem to be proceeding on the assumtion that if they just stall long enough, it will go away and business as usual can resume.

[dixiegrrrrl]

12. what you said.......

"we are too corrupt for it to come from the top (I think), and not sufficiently in the toilet for it to come from the bottom (yet)."


My take exactly.
That, and the fact that people born after 1960 today, for the most part, don't have the same attitude that propelled many of my generation into the streets.
Looking forward to seeing how many actually invade Wall St on the 17th.

[bemildred]

13. "Looking forward to seeing how many actually invade Wall St on the 17th"

Yes, that's an interesting question.

[golfguru]

5. Bankruptcy is always the only way out of massive debt

Borrowing more money to spend is like pouring gasoline on a fire. Uncle Sam is deep to his neck in debt, and the solution is just let everything default, wipe out the debt holders and start over.

Have you heard of any credit card holder who has maxed out all his credit cards, and then came out of it to solvency by getting a new credit card? Of course not.

[Yavin4]

10. There Will Either Be Massive Defaults or Hyper Inflation

There's no way possible that all of the debts owed on housing can be repaid. The "Master of the Universe" are just playing games with global currencies. They're only delaying the inevitable.

[evilDonkey]

14. That's how capitalism is supposed to work

Capitalism without failure isn't capitalism.

People should default and the banks should be declared insolvent. Once the debt is gone people will have money to spend and the economy will grow again.

No more Wall Street bailouts and no more stimulus spending, phony tax cuts or "jobs programs" which are really just Wall Street bailouts in disguise.