Quote:
Originally Posted by vc1111
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I have this posted on another forum also, I posted it to try and learn more about it, as I'm not that sharp when it comes to Wall Street. This is one of the more interesting responses I've gotten to this. It pertains to your link. These are not my thoughts, buy rather some of what I'm learning about this. I find it to be some what reveling.
A couple of pertinent points on the topic:
1) "Profits" and "earnings" are subjective and arbitrary terms when referring to a socialist economy or a mixed economy. (Why? because "profits" and "earnings" are moral in a free market by virtue of every exchange being voluntary and mutually beneficial. If the exchanges were not so they would not occur.)
One of the most telling statements in today's economic environment is that - 'the greatest accompishment of socialism is to blame it's failures on capitalism'.
The real failure is that "profits" and "earnings" do not exist as a result of interventionist policies - that is, whenever free-market principles are replaced or denied. (Why? Because under interventionist policies exchanges are forced as a result of moral hazard - some gain at the expense of others.)
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2) This statement as DiNapoli opines is dilusional but demonstrates the depths of depravity that the study of economics has become:
"Strong profits have been driven by low interest rates, which reduce the cost of doing business."
Utter nonsense.
Contrast what he claims to be true with the praxeolological reality.
*(
Praxeology is a manifestation of the human mind and deals with the actions open to men for the attainment of their chosen ends. Praxeology starts from the a priori category of action and then develops the full implications of such action. Praxeology aims at knowledge valid for all instances in which the conditions exactly correspond to those implied in its assumptions and inferences. Its statements and propositions are not derived from experience, but are antecedent to any comprehension of historical facts.)
"By preventing interest rates from telling the truth central bank policy inevitably sends out wrong signals about the real relationships between available savings and desired investment. The results are malinvestments, unsustainable bubbles and general economic harm."
- Richard Ebeling
and
"The essence of the market economy is that the economic actions of the individuals are not performed by order of the government but spontaneously by the individuals. This requires also that the money, the medium of exchange, be independent of political influence. if not, the coming years will be nothing but a series of failures of various government monetary and credit policies. To prevent this, it is necessary to make everybody realize that there are no Keynesian miracles possible, and that you cannot improve the situation of the people by credit expansion."
- Ludwig von Mises
What all this means is that intervention with the "true" or "market" rate of interest do not result in economic profitability, such intervention merely redistributes wealth and power to those who are in political favor at any particular time.
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3)
"Consumers are still finding difficultly accessing the credit markets," Napoli's report states, while commercial credit has declined by 52 percent since its peak in July 2007.
Here again the author comes through the 'back door' in an attempt to blame "the market" or free enterprize - by referring to "credit markets" - for tight credit. (In doing so he insinuates that for some reason credit ought not be 'tight'.)
Is it correct to blame 'credit markets' for something 'the market' does not control?
He neglects the obvious - socialist control of the medium of exchange, our MONEY.
Control of MONEY is control of SOCIETY = SOCIALISM.
Idiots ought not blame so-called 'markets' for the failures of socialism.
Wall Street Posts Biggest Profits Ever???
