Quote:
Originally Posted by 911teo
But I am saying that the COST of not interveening was far superior to the tax payers than a $138bn bailout.
What you are saying might be right in principle (I actually agree with you) but is not practical.
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Consider this "practical":
There are literally millions of market participants (me being one of them) who have tried to position themselves for the "collapse" of the essentially "fiction" the major investment banks have created.
When the government steps in and prevents the collapse a freer market would have allowed, the wealth transfer that would have occurred during the collapse does not happen.
This means that those who either did not understand, or who were involved in the deception, keep control of capital resources a freer market would have re-allocated.
When capital is kept, through an action like government intervention in the marketplace, in the hands of those who mis-manage it, or do not understand it, rather than transferring to the hands of those who would receive it if market forces were allowed to act freely, the net economic result is less growth (and often outright stagnation) than would have been achieved if market forces were allowed to act.
The government bailouts have prevented hundreds of billions of dollars worth of capital from being transferred from the "incompetent" to the competent.
The bailouts reward those with "political connections" who are willing to use the "government's gun" in the marketplace.
Violence has won out over competence in today's markets.