First Major Bank Failed Today - Proof that Recession is Real?

cool hand luke 22:36 said:
The term "Recession" is a technical term, used in the academic discipline of economics to describe a particular set of economic circumstances. It is well defined, and has been used and accepted for decades.

Buffet is attempting to redefine the term. He is not entilted to do so any more than he would be to redefine the term "Hurricane" so that it could be used to describe a mere tropical storm with much lower wind speeds, no clearly defined eye, no cyclic rotation, etc.

Haven't we, as gun owners, had enough of people twisting well defined technical terms to promote an agenda?
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Well said. I find it hilarious to see all the chicken little wannabes screaming that the sky is falling because they can't remember an economy that wasn't booming.

To compare our current situation and economy to the great depression because people have to pay more to drive to disney land or buy luxury items is stupid.
 
WellsFargo just announced quite good news today about their dividends.

IIRC, back in the late '80s, about 1380 banks went under. How many have gone under in the past year or two?

I'm sure more will follow. It appears IndyMac was in the news today about being investigated for fraudulant loans.

Let the banks that perform unlawful acts go under. It will rid of ones that don't deserve to contribute to the economy and put honest citizens at risk of their future investments.

If this thought is so bad, what do you think is happening to banks that run an "honest" business? They get the business from people that formerly banked at those that failed. I quoted honest because I'm a firm believer in credit unions as opposed to banks...
 
Except the bank isn't the one paying for the fraud. The depositors, investors, and taxpayers are.
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That's where shoddy business pracitices by banks in the future shouldn't be tolerated.

Investing in a bank is buyer beware.

Taxpayers should demand reform.
 
Originally Posted by cool hand luke 22:36

The term "Recession" is a technical term, used in the academic discipline of economics to describe a particular set of economic circumstances. It is well defined, and has been used and accepted for decades.

Buffet is attempting to redefine the term. He is not entilted to do so any more than he would be to redefine the term "Hurricane" so that it could be used to describe a mere tropical storm with much lower wind speeds, no clearly defined eye, no cyclic rotation, etc.

Haven't we, as gun owners, had enough of people twisting well defined technical terms to promote an agenda?
Click to expand...
Well said. I find it hilarious to see all the chicken little wannabes screaming that the sky is falling because they can't remember an economy that wasn't booming.

To compare our current situation and economy to the great depression because people have to pay more to drive to disney land or buy luxury items is stupid.
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All very well put, except for the word stupid.

According to lots in this thread, "recession" just means an economy that isn't in all respects as we would like it, which of course is not a recession at all.

I wouldn't have used the word "stupid" just because not understanding economics or economic terms is pretty common, and the urge to ridicule people who express an inchoate economic anxiety as, say, rubes who think black helicopter flying illuminati ruined paradise by inventing Walmart doesn't display much charity.
 
I wouldn't have used the word "stupid" just because not understanding economics or economic terms is pretty common, and the urge to ridicule people who express an inchoate economic anxiety as, say, rubes who think black helicopter flying illuminati ruined paradise by inventing Walmart doesn't display much charity.
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I get such a warm fuzzy feeling being around so many learned economist
as the last poster as so many economist are correct with their predictions
and the study of economics is akin to psychiatry, applying standard economic
terms to our current problems in the new global economy is like look for black
helicopters.;)
 
I get such a warm fuzzy feeling being around so many learned economist
as the last poster as so many economist are correct with their predictions...
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The issue isn't one of prediction, but diagnosis. "Recession" means something; we are not in one, full stop. A bank failure doesn't change that.

and the study of economics is akin to psychiatry, ...
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Yet you wouldn't call a fellow who stubs his toe and swears "psychotic".

But how can you use standard economic terms at a time like this? We've stubbed our toe!

...applying standard economic
terms to our current problems in the new global economy is like look[ing] for black
helicopters.
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My comment is contrary in all respects. The anxiety expressed over the first couple of pages as well as misuse of the word is understandable. However, it is the Henny Penny recession camp that is applying a standard economic term, albeit in error.

Hope that clarifies.
 
Given the poor lending practices of considerable numbers of institutions such as Country Wide, essentially making loans to people that were above and beyond what they could expect people to pay back if there was any shortcoming, this isn't a surprise.
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From Wikipedia:

IndyMac Bank was founded as Countrywide Mortgage Investment in 1985 by David Loeb and Angelo Mozilo as a means of collateralizing Countrywide Financial loans too big to be sold to Freddie Mac and Fannie Mae. In 1997, Countrywide spun off IndyMac as an independent company.
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Angelo Mozilo is the guy that was in bed with James Johnson, Obama's buddy and lead of his VP search until his questionable dealings were revealed.
 
Except the bank isn't the one paying for the fraud. The depositors, investors, and taxpayers are.
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Indymac is GONE.
Executives on the street unemployed. (Be sure to put that on your resume.)

The depositors are protected by the FDIC up to the insurance limits.

If by investors you mean stock holders in Indymac, they are the owners and lose. They could try and go after the officers of Indymac if the FBI does not get them first.

The taxpayers are not going to pay much of anything.
Even the FDIC is financed by the FDIC insured banks.
 
The taxpayers are not going to pay much of anything.
Even the FDIC is financed by the FDIC insured banks.
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If the FDIC were run dry, and it's possible with a few big failures, the shortfall is guaranteed by the full faith and credit of the United States, meaning the power to tax it out of us.
 
If the FDIC were run dry, and it's possible with a few big failures, the shortfall is guaranteed by the full faith and credit of the United States, meaning the power to tax it out of us.
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The FDIC can levy all the FDIC ensured banks to make up the shortage.
 
Ask the bank.
It is a cost of having FDIC insurance.
Will it increase fees? Possibly.
Will it lower rates paid? Possibly.

Banks are in business to make money.
 
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