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Discussion Forum : General Topics : Worst crisis since Great Depression?

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ilive4only1
Member



Joined: 2007/1/22
Posts: 33
Texas

 Worst crisis since Great Depression?

" "This has been the worst financial crisis since the Great Depression. There is no question about it," said New York University economist Mark Gertler in the WSJ.

The U.S. financial system is like a patient in intensive care, the Journal states. "The body is trying to fight off a disease that is spreading, and as it does so, the body convulses, settles for a time and then convulses again.

The disease? The unwinding of the massive debt that banks and regular Americans have taken on in recent years. Household borrowing grew at an 11% average annual rate between 2002 and 2006, the Journal says, outpacing overall economic growth. Banks were just as bad. And now, well, the piper is being paid.

The article has a good explainer on credit-default swaps, a game that helped bring AIG down. Basically, the swaps are a way for firms to place bets on whether a borrower is going to default. Sounds like a sick little game, wagering on whether a company can honor its obligations. But it's a way firms get some insurance on their risk exposure. AIG sold lots of these swaps, and buyers thought the insurance giant would help protect them against defaults.

Yet some aspects of the economy seem surprisingly resilient to the financial system's woes. Unemployment isn't as bad as it was in the early 1990s, and companies are still pouring money into marketing and research, the Journal says. Exports are still strong and the government has moved swiftly to address disasters in the making."

Source MSN Money http://blogs.moneycentral.msn.com/topstocks/archive/2008/09/18/worst-crisis-since-great-depression.aspx


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Dyanne

 2008/9/19 3:23Profile









 Re: Worst crisis since Great Depression?

These are very shakey times, to be sure. I certainly do not understand everything that is going on, but one thing I know... the smart people will get out of debt as soon as possible. Carrying debt will suck you under right now.

This all comes down to greed. We have to have the biggest house, the newest SUV... etc. It's crazy. It's materialism.

We have a decent house and we drive older vehicles. Our van is a 1999. My Jeep is a 1996... and my pick 'em up truck is a 1982 Ford F-100 (and looks every bit of it's age!). I blessed to be born into a family that built stock cars (race cars for those not from the south!) to race on local dirt tracks on Saturday nights... so I know how to keep my vehicles running. We just had the transmission rebuilt on our van this summer and that was the first time I took a vehicle to a mechanic in over 10 years.

But the best part of it is: No debt. Our house and vehicles are paid off, and I think we have like $300 charged to a credit card, and thats it. There is peace of mind that comes with that. Whats happening in our economy is bothersome because it effects my business, but I'm not worried about it because first off: God is in control. Secondly: I'm not worried about Mr. Banker coming and taking my house.

I highly recommend that everyone here do everything they can possibly do to get out from under your debt. It'll hurt while you're doing it, and it'll take sacrifice... but it's the good and godly thing to do.

Krispy

 2008/9/19 7:10
rookie
Member



Joined: 2003/6/3
Posts: 4792


 Re: Worst crisis since Great Depression?

Today marks the day that our nation has become bondservants to the world. The stock market is scheduled to continue the upward move that began yesterday afternoon when our government announced that the taxpayer of the United States would accept the burden created by the princes of this nation....

This is indeed a historic time for this nation. I have been reading in the book of Judges and this generation is no different than those who did evil in the sight of the Lord...and we will bear the burden of our worship of other gods....

Pray that we believers may continue to be allowed to live godly and peaceful lives.

In Christ
Jeff


_________________
Jeff Marshalek

 2008/9/19 9:34Profile
Nellie
Member



Joined: 2004/4/5
Posts: 952


 Re:

Amen to your post, Krispy.

We have the assurance of God's Word, that the righteous won't be forsaken, or their seed beg bread.

It sure is greed that has put America where she is.

May we turn our eyes upon Jesus
Look full in His Wonderful Face.
And the things of Earth will grow strangely dim,
In the Light of His Glory and Grace.

God Bless all
Nellie

 2008/9/19 9:44Profile
psalm1
Member



Joined: 2007/1/30
Posts: 1230


 Re: Worst crisis since Great Depression?

An interesting twist;

If the gov. "purchased" controlling interest of AIG ,and the ceo's and officers are prosecuted.
Do we,"the gov." stand to receive dividends and disgorgement monies?

naaaa

 2008/9/19 10:06Profile









 Re:

Quote:
Do we,"the gov." stand to receive dividends and disgorgement monies?



Don't hold your breath...

Krispy

 2008/9/19 10:16
psalm1
Member



Joined: 2007/1/30
Posts: 1230


 Re:

The gov, bailout of AIG could have been radically premature.
It could very well be the gov. made the steal of the century.
they had tons and tons of assets.

One thing I keep looking for that is absent is the Arab involvement in the Mortgage"crisis"

Is it really a crisis?

Arabs unwittingly bought tons of "Paper" from mortgage companies. These Arab investors believed they were getting a steal.

Makes me wonder,who,in actuality, got "bailed out"

 2008/9/19 10:19Profile
ilive4only1
Member



Joined: 2007/1/22
Posts: 33
Texas

 Re:

"My hope is in, the name of the Lord. He is my strength, my song. My heart can rest, I'm in his hands where I belong"--Lisa Gungor

Very good point. We must pray for our nation. For these are truly shakey times. Yet, even in times of crisis we need not trust in man, but in the Lord.

Maybe now, even more so, our eyes will become open to understand that although we live in this world, we must not let this world be in us.


2Ti 3:1 [b][size=x-small]But this know, that in [the] last days difficult times shall be there; [/size][/b]

2Ti 3:2 for men shall be lovers of self, lovers of money, boastful, arrogant, evil speakers, disobedient to parents, ungrateful, profane,
2Ti 3:3 without natural affection, implacable, slanderers, of unsubdued passions, savage, having no love for what is good,
2Ti 3:4 traitors, headlong, of vain pretensions, lovers of pleasure rather than lovers of God;
2Ti 3:5 having a form of piety but denying the power of it: and from these turn away. - Darby Translation


_________________
Dyanne

 2008/9/19 10:50Profile
MisterCheez
Member



Joined: 2006/2/22
Posts: 96
Colorado

 Re:

Quote:
The gov, bailout of AIG could have been radically premature. It could very well be the gov. made the steal of the century.
they had tons and tons of assets.



I heard a gentleman on NPR the other night assessing the AIG situation and, if I understood correctly, the collateral/assets AIG maintains are things like peoples' life insurance policies, retirement funds, money markets, etc. So if AIG folds, does the government take those assets as repayment for the $85 billion loan? That's not collateral I'd want my financial group offering for a bailout loan!


_________________
Brian Erickson

 2008/9/19 12:17Profile
Lawevangelis
Member



Joined: 2004/10/9
Posts: 97
Justin, TX

 Re:

Krispy,

Thanks for your encouragement to pay off debt. It's one we all need to hear.

This year, we've been blessed to pay off about $11,000 in credit card debt. We still have about $7,000 to go, but we're encouraged. That's almost all been moved to a 0% interest card and we're getting aggressive now that we can see a little light at the end of the tunnel.

We have no auto debt; both are paid for. We do have a mortgage, but we've built good equity and our market has not taken the hit that the rest of the nation has.

God is good and we are convinced that debt is a plague on our country. It has been a plague on us. We made a lot of stupid mistakes and let our desire for instant gratification outweigh our common sense and the clear direction of Scripture.

We are in full time ministry and just found out our salary will be cut by a third, with scale backs starting in October. We need to cut expenses to continue to pay off debt, so we're considering a move to an area where we can cut our mortgage payment in half.

We praise the Lord for this; He has taught us much (the hard way). He is worthy to be praised.

Blessings,

Jon


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Jon Speed

 2008/9/19 12:31Profile





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