4 ms·

isn't that the point of capitalism, the fit live the poor die? Let the poor malls die, if their business model fails. We shouldn't force a failed business to la

isn't that the point of capitalism, the fit live the poor die? Let the poor malls die, if their business model fails. We shouldn't force a failed business to last longer than society needs it to, otherwise that's something beyond capitalism.

soperj 6y ago
the point though they're making is that if they die, then it can massively affect the banks. The knock on effect could be huge.
- fl0wenol 6y ago
  Oh well, those banks should have had a backup plan </s>
  - Bombthecat 6y ago
    The backup plan is state money.
    - DSingularity 6y ago
      No. The backup plan is to screw the people. Slash interest rates, eliminate fractional reserve requirements, and buy corporate bonds and securities.
      - munk-a 6y ago
        I disagree - their backup plan is getting bailed out. What you listed above is just standard operating procedure for them on a day-to-day.
      - true_religion 6y ago
        Banks being bailed out has been national policy in the US since the Great Depression. Previous to that there were 3 national panics and bank runs, and banks were considered juicy targets for robbers as well. The federal insurance program made it so people could trust in banking again. Now I do think that the policy has gone too far. Bank investments should receive any bailout, those are part and parcel of the normal functioning market.
        linuxftw 6y ago
        You don't have to worry about bank runs if you're not a fractional reserve bank. People were right to not trust banks, banks were fraudsters, loaning out money that wasn't theirs, then when people caught wind of it, the system collapsed. The real laws should have been 'banks shall not loan out money from a depositor's account' and the problem would have been resolved. Investors could have loaned out money. Insurance could have protected against bank robberies, similar to how any kind of insurance works against theft today.
simonh 6y ago
In a situation like this, capitalism hits its limits. Don’t get me wrong, Im a thorough going capitalist. To me it’s simply a consequence of respecting individual freedoms and individual property rights. The rest of capitalism flows from those two principles. In this situation though, when there is a threat to society as a whole either military or natural, there’s a legitimate role for society to pull together and coordinate our actions. That’s what government is for. All societies can benefit from consensus and leadership, especially in situations like this. If their business model really fails, then fine, that’s because there’s enough value in alternative providers that these ones are no longer needed. However in temporary crises it’s possible that the process of dissolving businesses can leave a gap in the provision of valuable or even vital services that the market cannot fill fast enough. Markets are incredibly powerful, but they aren’t omniscient or omnipotent. This is why although I’m a believing capitalist, I think there is a role for regulation and even bailouts in extraordinary circumstances. I’ll even extend that to individuals, a crisis can hit any of us just as it can hit a business. I don’t see that necessarily as socialism, just good management when done judiciously and proportionately. Ultimately it’s about fairness and good outcomes. I’ve no time for ideologies.
- valuearb 6y ago
  I’m fine with bailing out companies as long as the owners and managers forfeit all their equity.
  - munk-a 6y ago
    It's not an easy thing to find out who did what - trying to figure out which managers and owners were purposefully over-inflating equity to secure larger loans (or whatever) from those who were duped by the other managers and were just trying to keep the ship afloat is a really hard problem. And, in this fun world, you might find a terribly over-leveraged business where no one ever tried to act fraudulently but some vulture capitalist consultant helped "ensure access to liquid assets" and is now in Kiribati watching the world burn.
    - true_religion 6y ago

soperj 6y ago

the point though they're making is that if they die, then it can massively affect the banks. The knock on effect could be huge.

fl0wenol 6y ago
Oh well, those banks should have had a backup plan </s>
- Bombthecat 6y ago
  The backup plan is state money.
  - DSingularity 6y ago
    No. The backup plan is to screw the people. Slash interest rates, eliminate fractional reserve requirements, and buy corporate bonds and securities.
    - munk-a 6y ago
      I disagree - their backup plan is getting bailed out. What you listed above is just standard operating procedure for them on a day-to-day.
    - true_religion 6y ago
      Banks being bailed out has been national policy in the US since the Great Depression. Previous to that there were 3 national panics and bank runs, and banks were considered juicy targets for robbers as well. The federal insurance program made it so people could trust in banking again. Now I do think that the policy has gone too far. Bank investments should receive any bailout, those are part and parcel of the normal functioning market.
      - linuxftw 6y ago
        You don't have to worry about bank runs if you're not a fractional reserve bank. People were right to not trust banks, banks were fraudsters, loaning out money that wasn't theirs, then when people caught wind of it, the system collapsed. The real laws should have been 'banks shall not loan out money from a depositor's account' and the problem would have been resolved. Investors could have loaned out money. Insurance could have protected against bank robberies, similar to how any kind of insurance works against theft today.

simonh 6y ago

In a situation like this, capitalism hits its limits. Don’t get me wrong, Im a thorough going capitalist. To me it’s simply a consequence of respecting individual freedoms and individual property rights. The rest of capitalism flows from those two principles. In this situation though, when there is a threat to society as a whole either military or natural, there’s a legitimate role for society to pull together and coordinate our actions. That’s what government is for. All societies can benefit from consensus and leadership, especially in situations like this. If their business model really fails, then fine, that’s because there’s enough value in alternative providers that these ones are no longer needed. However in temporary crises it’s possible that the process of dissolving businesses can leave a gap in the provision of valuable or even vital services that the market cannot fill fast enough. Markets are incredibly powerful, but they aren’t omniscient or omnipotent. This is why although I’m a believing capitalist, I think there is a role for regulation and even bailouts in extraordinary circumstances. I’ll even extend that to individuals, a crisis can hit any of us just as it can hit a business. I don’t see that necessarily as socialism, just good management when done judiciously and proportionately. Ultimately it’s about fairness and good outcomes. I’ve no time for ideologies.

valuearb 6y ago
I’m fine with bailing out companies as long as the owners and managers forfeit all their equity.
- munk-a 6y ago
  It's not an easy thing to find out who did what - trying to figure out which managers and owners were purposefully over-inflating equity to secure larger loans (or whatever) from those who were duped by the other managers and were just trying to keep the ship afloat is a really hard problem. And, in this fun world, you might find a terribly over-leveraged business where no one ever tried to act fraudulently but some vulture capitalist consultant helped "ensure access to liquid assets" and is now in Kiribati watching the world burn.
  - true_religion 6y ago