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What about solvency, and the knock on effect to creditors. They can't pay the booze supplier and they go out of business etc. This could go on for months. Most

by mc3 7y ago

What about solvency, and the knock on effect to creditors. They can't pay the booze supplier and they go out of business etc. This could go on for months. Most businesses don't make those sweet SaaS margins. Same for airlines.

cma 7y ago
Other countries are doing loan payment, rent, and interest moratoriums, etc. We've built everything with growth as an underlying assumption with no ability to pause things and focus on essential services for a month or two and then start back up.
anigbrowl 7y ago
Creditors can experience some of the pain that they normally inflict on others. They are not sacrosanct and are the least important parties in economic relations during an emergency. As normality is restored, they will have new opportunities during the ensuing large scale financial restructuring.
- rtpg 7y ago
  The thing is that a lot of creditors (suppliers basically) are just other businesses. It’s not all bankers holding onto a bunch of debt obligations Probably ironically banks will be able to make even more money as people pull into credit lines to go over this hump
- briandear 7y ago
  Bob’s Drywall Supply has net 60 for a delivery of drywall. Constructor Bill now can’t pay. Bob’s Drywall is a creditor and is on the hook for a product he already shipped. Now Bob’s Drywall Supply can’t pay the company that provided him with Net 90 terms. So Bob and Bill are now insolvent. And they fire their employees. Suggesting that creditors somehow deserve “pain,” is just cruel. Creditors don’t “inflict pain” on people — they provide capital to people with a reasonable expectation of getting paid back. Of course I don’t care much about the Payday Lender/predatory lenders so much, but suggesting that creditors deserve some sort of payback is ridiculous. The vast majority of businesses rely on credit, without credit, you would have an economic collapse. And they aren’t the “least important” parties — they are the most important because they’re the ones providing the capital for businesses to operate.
  - bosswipe 7y ago
    The problem is when everybody takes a hit except the "too big to fail" banks. That's what happened in the last financial crisis, the government bailed out only the big banks by buying their toxic loans at face value. When Obama tried to also bail out individual homeowners it sparked the Tea Party backlash and he pretty much backed off on those plans.
    - yostrovs 7y ago
      You're twisting history. The tea party backlash was to the bailing out of banks.
      - jnwatson 7y ago
        You misremember. [1] has the video on CNBC that started the Tea Party. “Yesterday Rick Santelli, who reports from the floor of the Chicago Board of Trade the for CNBC, unleashed a rant against Obama’s newly announced housing bailout plan, intended to help some homeowners refinance mortgages and avoid foreclosure.” 1: https://opinionator.blogs.nytimes.com/2009/02/20/rick-santelli-tea-party-time/ https://opinionator.blogs.nytimes.com/2009/02/20/rick-santel...
      - bosswipe 7y ago
        The spark for the Tea Party was a viral rant by CNBC's Rick Santelli against a program to help individuals avoid foreclosure. Look it up.
      - CydeWeys 7y ago
        Their main issue was being pro-austerity. Most of what they focused on was cutting funding for Social Security, Medicare, Medicaid, and other social services. They wanted a smaller government at all costs (though curiously they never called for reducing military spending). Occupy Wall Street, on the other hand, was the group that was specifically against bailing out the banks. The Tea Party was more about not helping regular people.
  - anigbrowl 7y ago
grumple 7y ago
This is why the money has to go to the bottom so it can bubble up. All debts get paid off along the way. Government bails out the small business, the small business pays the distributor, they pay their creditor, etc. Investors still make money at the top. If bubble up economics becomes a thing I want full credit.
- gshubert17 7y ago
  Yes, I hope that would work. If the 700 billion dollars for quantitative easing went to 200 million U.S. adults, that'd be $3,500 apiece. If spent at the rate of $700 a week, that'd be five weeks' worth.
  - whatshisface 7y ago
    QE was a combination of asset purchases and loans. It couldn't have gone to individual people.
- bavell 7y ago
  Andrew Yang has been pushing for this kind of "trickle-up" economics for awhile now with his UBI platform.

by mc3 7y ago

cma 7y ago

Other countries are doing loan payment, rent, and interest moratoriums, etc. We've built everything with growth as an underlying assumption with no ability to pause things and focus on essential services for a month or two and then start back up.

anigbrowl 7y ago

Creditors can experience some of the pain that they normally inflict on others. They are not sacrosanct and are the least important parties in economic relations during an emergency. As normality is restored, they will have new opportunities during the ensuing large scale financial restructuring.

rtpg 7y ago
The thing is that a lot of creditors (suppliers basically) are just other businesses. It’s not all bankers holding onto a bunch of debt obligations Probably ironically banks will be able to make even more money as people pull into credit lines to go over this hump
briandear 7y ago
Bob’s Drywall Supply has net 60 for a delivery of drywall. Constructor Bill now can’t pay. Bob’s Drywall is a creditor and is on the hook for a product he already shipped. Now Bob’s Drywall Supply can’t pay the company that provided him with Net 90 terms. So Bob and Bill are now insolvent. And they fire their employees. Suggesting that creditors somehow deserve “pain,” is just cruel. Creditors don’t “inflict pain” on people — they provide capital to people with a reasonable expectation of getting paid back. Of course I don’t care much about the Payday Lender/predatory lenders so much, but suggesting that creditors deserve some sort of payback is ridiculous. The vast majority of businesses rely on credit, without credit, you would have an economic collapse. And they aren’t the “least important” parties — they are the most important because they’re the ones providing the capital for businesses to operate.
- bosswipe 7y ago
  The problem is when everybody takes a hit except the "too big to fail" banks. That's what happened in the last financial crisis, the government bailed out only the big banks by buying their toxic loans at face value. When Obama tried to also bail out individual homeowners it sparked the Tea Party backlash and he pretty much backed off on those plans.
  - yostrovs 7y ago
    You're twisting history. The tea party backlash was to the bailing out of banks.
    - jnwatson 7y ago
      You misremember. [1] has the video on CNBC that started the Tea Party. “Yesterday Rick Santelli, who reports from the floor of the Chicago Board of Trade the for CNBC, unleashed a rant against Obama’s newly announced housing bailout plan, intended to help some homeowners refinance mortgages and avoid foreclosure.” 1: https://opinionator.blogs.nytimes.com/2009/02/20/rick-santelli-tea-party-time/ https://opinionator.blogs.nytimes.com/2009/02/20/rick-santel...
    - bosswipe 7y ago
      The spark for the Tea Party was a viral rant by CNBC's Rick Santelli against a program to help individuals avoid foreclosure. Look it up.
    - CydeWeys 7y ago
      Their main issue was being pro-austerity. Most of what they focused on was cutting funding for Social Security, Medicare, Medicaid, and other social services. They wanted a smaller government at all costs (though curiously they never called for reducing military spending). Occupy Wall Street, on the other hand, was the group that was specifically against bailing out the banks. The Tea Party was more about not helping regular people.
- anigbrowl 7y ago

grumple 7y ago

This is why the money has to go to the bottom so it can bubble up. All debts get paid off along the way. Government bails out the small business, the small business pays the distributor, they pay their creditor, etc. Investors still make money at the top. If bubble up economics becomes a thing I want full credit.

gshubert17 7y ago
Yes, I hope that would work. If the 700 billion dollars for quantitative easing went to 200 million U.S. adults, that'd be $3,500 apiece. If spent at the rate of $700 a week, that'd be five weeks' worth.
- whatshisface 7y ago
  QE was a combination of asset purchases and loans. It couldn't have gone to individual people.
bavell 7y ago
Andrew Yang has been pushing for this kind of "trickle-up" economics for awhile now with his UBI platform.