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(Reuters)   Somewhere in the corporate world, a CEO is reading this article and chortling ferociously   (reuters.com) divider line 100
    More: Obvious, tax profit, social cohesion, International Labor Organization, current accounts, booms and busts  
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4411 clicks; posted to Politics » on 12 Dec 2012 at 8:28 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-12-12 08:32:08 AM
"If rising income gaps are at least partly responsible for the global credit crisis"

Let's stop right there. If? Partly?
 
2012-12-12 08:32:47 AM

MayoSlather: "If rising income gaps are at least partly responsible for the global credit crisis"

Let's stop right there. If? Partly?


At least.
 
2012-12-12 08:33:15 AM
They don't take these things seriously until they see fellow board member's corpses being paraded around in the streets.
 
2012-12-12 08:38:04 AM
Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.
 
2012-12-12 08:38:32 AM
FTFA: Whether you fear the impact on people's aspirations and sense of social justice or the sustainability of the corporate world's inflated share of the pie, the numbers are alarming everyone.

Everyone? I see the author has never heard of the GOP.
 
2012-12-12 08:40:39 AM

Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.


Yes, the REAL problem is that people want to have a better life...KFTC
 
2012-12-12 08:42:15 AM

Shaggy_C: Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining.


Despite? Try because.
 
2012-12-12 08:42:45 AM

Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.



Corporations need this class to spend like they do in order to give themselves the money they want.

It is a communal relationship.

I think the middle class has been far poorer than they actually are but if they did not spend like they had in the past 30 years no way do profits and the econonmy grow as it had for those thirty years.

Cant have one without the other.

Hostess files for bankruptcy 8 years ago....they agree to lowering wages and benefits for the worker class....the CEO after the bankruptcy increases his salary nearly 300%.....

COuldnt be more plainer right there.
 
2012-12-12 08:44:17 AM

Shaggy_C: Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining


You're right, people had to use credit because wages weren't going up.
 
2012-12-12 08:45:12 AM

Tarl3k: Yes, the REAL problem is that people want to have a better life...KFTC


There's two ways to get a better life: demand higher wages, either by convincing your bosses to pay you more or leaving for green pastures; or, by spending money you don't actually have by racking up credit card bills and taking second mortgages on your house. Unfortunately, the second option is the path of least resistance and that's exactly what people did. Honestly, if it had not been for the rise of easy credit during the 1990s and 2000s, I wonder if wages would have actually stayed as stagnant as they did? In many respects, it's the same idea as the disastrous tax cuts from the early 2000s, where after-tax income increased for people to the extent that demand for increased pre-tax income fell.
 
2012-12-12 08:45:12 AM
Exactly what does a ferocious chortle sound like?
 
2012-12-12 08:45:20 AM
How much of that credit was to put a $25,000 kitchen in a $100,000 house that was artificially raised to $250,000 because banks were giving mortgages to anyone with a pulse?
 
2012-12-12 08:46:53 AM

Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.


Yes, anyone can increase their gross income any ti me they want. Its all so very simple. See..... look...ughhhnmnn.....There I just increase my gross income by 5%. All it takes is a little effort.
 
2012-12-12 08:47:26 AM

Shaggy_C: There's two ways to get a better life: demand higher wages, either by convincing your bosses to pay you more


That was tried, they just went and found legal slaves on the other side of the planet in response.
 
2012-12-12 08:48:38 AM

graggor: I think the middle class has been far poorer than they actually are but if they did not spend like they had in the past 30 years no way do profits and the econonmy grow as it had for those thirty years.

Cant have one without the other.


Exactly my point. The "fat cat" CEOs didn't create the problem by having nice cars and huge houses. It's a demand issue - you have inflated demand, companies increase supply to match, which in turn leads to even more demand. When the cycle breaks down - in this case, because credit became less available - the whole system goes the other direction. Decreased demand means decreased supply, which means companies lay off workers and stop producing. Less people in the workforce means even less demand, and the downward spiral continues.
 
2012-12-12 08:48:45 AM

Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.


In simpler terms: know your place peasant.
 
2012-12-12 08:49:32 AM
Many Tea Partiers cheer this kind of news.
 
2012-12-12 08:49:35 AM

HotWingConspiracy: Shaggy_C: There's two ways to get a better life: demand higher wages, either by convincing your bosses to pay you more

That was tried, they just went and found legal slaves on the other side of the planet in response.


No, no, you don't understand. It was the fault of the slaves for not increasing their skill set to the level that their masters would feel compelled to pay them wages.
 
2012-12-12 08:49:49 AM

b0rscht: Exactly what does a ferocious chortle sound like?


Sort of like a boom that rattles windows in an empty warehouse, or somesuch.
 
2012-12-12 08:49:54 AM

Shaggy_C: Tarl3k: Yes, the REAL problem is that people want to have a better life...KFTC

There's two ways to get a better life: demand higher wages, either by convincing your bosses to pay you more or leaving for green pastures; or, by spending money you don't actually have by racking up credit card bills and taking second mortgages on your house. Unfortunately, the second option is the path of least resistance and that's exactly what people did. Honestly, if it had not been for the rise of easy credit during the 1990s and 2000s, I wonder if wages would have actually stayed as stagnant as they did? In many respects, it's the same idea as the disastrous tax cuts from the early 2000s, where after-tax income increased for people to the extent that demand for increased pre-tax income fell.


You can't be this oblivious to reality.
 
2012-12-12 08:49:56 AM

Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.


Damn these poors wanting to live a better life!!! Just be content in your hovel while I siphon the profit from your labor into my offshore bank account, and be happy I gave you a job you mewling quim.
 
2012-12-12 08:51:25 AM

Shaggy_C: It's a demand issue - you have inflated demand, companies increase supply to match, which in turn leads to even more demand


You don't actually understand how supply and demand work, do you?
 
2012-12-12 08:52:03 AM

TheGreatGazoo: How much of that credit was to put a $25,000 kitchen in a $100,000 house that was artificially raised to $250,000 because banks were giving mortgages to anyone with a pulse?


And home prices got so high that in some cities, only a "jumbo" loan gets you a small 2br/1ba
 
2012-12-12 08:54:40 AM

HotWingConspiracy: That was tried, they just went and found legal slaves on the other side of the planet in response.


Why no one seems to be calling this from the rooftops I am not sure. There seems to still be this undercurrent in America where "free trade" = "freedom" = "liberty" = "apple pie and George Washington and the stars and stripes and if you don't like it you are a terrorist". Not like either party is going to touch free trade with a ten foot pole - in 2008, at least we got empty rhetoric about renegotiating NAFTA; in 2012, we have our president using his new free trade agreements in South America to highlight his success in the first term.

But I digress. Point is, you're right, the lack of fair competition for jobs was the precursor to the wage stagnation.
 
2012-12-12 08:55:21 AM

Sm3agol85: Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.

Damn these poors wanting to live a better life!!! Just be content in your hovel while I siphon the profit from your labor into my offshore bank account, and be happy I gave you a job you mewling quim.


Where the actual solution is to force your employer to give you a fair wage by organizing into a union. But in this country, unions are bad and dumb, because somehow we've all bought into the idea that someday, *we'll* be the boss, despite that that's an impossible pyramid scheme. Instead, accept that there are bosses and there are workers, and as long as that's what the situation will always be, then lets have it so the workers can also have a nice (not extravagant, but nice) life
 
vpb [TotalFark]
2012-12-12 08:57:53 AM

MayoSlather: "If rising income gaps are at least partly responsible for the global credit crisis"

Let's stop right there. If? Partly?


Well, fraudulent financial instruments had a bit to do with it.
 
2012-12-12 08:58:03 AM

t3knomanser: You don't actually understand how supply and demand work, do you?


Ah yes, I forgot, we are on the liberal fairy tale boards of Fark.com, where companies don't make production decisions based on anticipated demand, but based solely on what the CEO commands (and that means to underproduce just because CEOs love layoffs!) No corporation in history has ever tried to maximize profits based on the concept of marginal revenue and marginal cost.
 
2012-12-12 08:58:10 AM

pivazena: Sm3agol85: Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.

Damn these poors wanting to live a better life!!! Just be content in your hovel while I siphon the profit from your labor into my offshore bank account, and be happy I gave you a job you mewling quim.

Where the actual solution is to force your employer to give you a fair wage by organizing into a union. But in this country, unions are bad and dumb, because somehow we've all bought into the idea that someday, *we'll* be the boss, despite that that's an impossible pyramid scheme. Instead, accept that there are bosses and there are workers, and as long as that's what the situation will always be, then lets have it so the workers can also have a nice (not extravagant, but nice) life


I was thinking about that for myself, as a recent PhD I find that my earning power has actually declined. I'm not doing this for the money, but appropriate compensation for my skill level would be nice. Maybe start me at $50 or $55 a year, and I won't be tempted to go to Industry
 
2012-12-12 09:00:22 AM

Apocalyptic Inferno: You can't be this oblivious to reality.


Et tu, Inferno? There's nothing "oblivious" here, it's the cold hard facts. We used to have this concept of fighting for higher wages, it was called "organized labor". You see, in the old days, liberals used to actually band together and demand higher pay. Today, you people are just whinging about what has been forced upon you like victims. The reason the rich have won is because they succeeded in turning every man into an island.
 
2012-12-12 09:01:23 AM
We've put money on credit cards that we never wished to. Not to "keep up with the Joneses", but to pay for expenses we didn't have the money to cover (car problems, hospital bills). Some of this might have been relieved by raises...but my husband's wages have been on a pay freeze for the last three years. Meanwhile, groceries have gone up, various family members have been in the hospital, cars have broken down, and our house has needed repair. But obviously, it's our fault because we shouldn't have spent beyond our means.
 
2012-12-12 09:02:38 AM

Shaggy_C: Tarl3k: Yes, the REAL problem is that people want to have a better life...KFTC

There's two ways to get a better life: demand higher wages, either by convincing your bosses to pay you more or leaving for green pastures; or, by spending money you don't actually have by racking up credit card bills and taking second mortgages on your house. Unfortunately, the second option is the path of least resistance and that's exactly what people did. Honestly, if it had not been for the rise of easy credit during the 1990s and 2000s, I wonder if wages would have actually stayed as stagnant as they did? In many respects, it's the same idea as the disastrous tax cuts from the early 2000s, where after-tax income increased for people to the extent that demand for increased pre-tax income fell.


ME: I demand higher wages.
FAT CAT: No.
ME: Uhm....
 
2012-12-12 09:02:56 AM

Dusk-You-n-Me: Shaggy_C: Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining.

Despite? Try because.


Sadly, I think he's actually right.

You'll never find a more outspoken critic of the financial elites of this country than me. They've sucked the marrow out of the United States in a way we've never seen before and after the 2008 crash, we should have seen lines of bankers paraded along Wall Street in shackles.

That said, I think anyone looking at this issue MUST logically conclude that the dysfunctional attitudes regarding money have infected all levels of our society. The middle class foolishly bought into the idea that they were entitled to a slice of the lifestyles they saw their celebrity heroes on TV enjoying, and subsequently ended up spending like drunken sailors. There was a time when commercials like these had receptive audiences:

SUZANNE RESEARCHED THIS!

I'm in debt up to my eyeballs

The elites of this country are undoubtedly guilty, but the middle class willfully allowed itself to be manipulated by them. If we're going to fix this problem with a long term solution, then everyone involved needs to take a shred of responsibility for it.

\\Goldman Sachs should have been raided by the FBI.
 
2012-12-12 09:04:44 AM

Shaggy_C: Apocalyptic Inferno: You can't be this oblivious to reality.

Et tu, Inferno? There's nothing "oblivious" here, it's the cold hard facts. We used to have this concept of fighting for higher wages, it was called "organized labor". You see, in the old days, liberals used to actually band together and demand higher pay. Today, you people are just whinging about what has been forced upon you like victims. The reason the rich have won is because they succeeded in turning every man into an island.



So, you're in favor of unions. Good to hear.
 
2012-12-12 09:05:09 AM
Oh man I can already tell this is going to go to 11 on the stupidity dial
 
2012-12-12 09:05:37 AM
fta But as they'll get little or no help from easy credit today, driving wages down even more risks a cratering of household consumption and a severe test of social cohesion.

Rather than paying wage slaves more money, a better solution is to allow full-time workers access to the company food bank and assistance applying for medicaid.
 
2012-12-12 09:08:09 AM

pivazena: Where the actual solution is to force your employer to give you a fair wage by organizing into a union. But in this country, unions are bad and dumb, because somehow we've all bought into the idea that someday, *we'll* be the boss, despite that that's an impossible pyramid scheme. I


I'd prefer to see government regulation in place of unions. I've stated this here before, but a regulation on corporate employee profit sharing would be the optimal solution. There are always issues with unions and while they do well to give employees a voice they also are capable of causing a lot of unnecessary strife.
 
2012-12-12 09:08:30 AM
That the ruler and people of Liechtenstein aren't shilling for change on the streets is an indictment of our priorities
 
vpb [TotalFark]
2012-12-12 09:09:02 AM

Shaggy_C: t3knomanser: You don't actually understand how supply and demand work, do you?

Ah yes, I forgot, we are on the liberal fairy tale boards of Fark.com, where companies don't make production decisions based on anticipated demand, but based solely on what the CEO commands (and that means to underproduce just because CEOs love layoffs!) No corporation in history has ever tried to maximize profits based on the concept of marginal revenue and marginal cost.


Yep. Consumer demand has nothing to do with the income of consumers or the lack of income. Nothing at all.
 
2012-12-12 09:09:54 AM

Shaggy_C: Apocalyptic Inferno: You can't be this oblivious to reality.

Et tu, Inferno? There's nothing "oblivious" here, it's the cold hard facts. We used to have this concept of fighting for higher wages, it was called "organized labor". You see, in the old days, liberals REPUBLICANS used to actually band together and demand higher pay. Today, you people are just whinging about what has been forced upon you like victims. The reason the rich have won is because they succeeded in turning every man into an island.


s3.amazonaws.com

And now, Republicans operate on the base of, "you poors should be happy I give you a job".
 
2012-12-12 09:12:38 AM

MayoSlather: pivazena: Where the actual solution is to force your employer to give you a fair wage by organizing into a union. But in this country, unions are bad and dumb, because somehow we've all bought into the idea that someday, *we'll* be the boss, despite that that's an impossible pyramid scheme. I

I'd prefer to see government regulation in place of unions. I've stated this here before, but a regulation on corporate employee profit sharing would be the optimal solution. There are always issues with unions and while they do well to give employees a voice they also are capable of causing a lot of unnecessary strife.


But as this election (and this financial cliff bs) showed, politicians can be bought. Frankly, I'd rather both unions and bosses buy politicians than being in a position where only bosses are wealthy enough to do so. Until we majorly reform our political funding system, we need ways for all to have equal influence. Sadly, now, money as speech (instead of actual speech) is the only way to influence
 
2012-12-12 09:16:57 AM
i53.tinypic.com
i51.tinypic.com
i52.tinypic.com
i54.tinypic.com
i51.tinypic.com
 
2012-12-12 09:21:25 AM

ltdanman44: [i53.tinypic.com image 590x443]
[i51.tinypic.com image 590x442]
[i52.tinypic.com image 590x442]
[i54.tinypic.com image 590x442]
[i51.tinypic.com image 590x443]


Clearly, the problem here is that the rich are taxed at an exorbitant rate.
 
2012-12-12 09:23:18 AM

contrapunctus: The elites of this country are undoubtedly guilty, but the middle class willfully allowed itself to be manipulated by them.


Maybe we shouldn't have had a President telling the people to go out and spend money after an historic attack on the country. Or allowed CC companies to write their own rules, or change them, you know, when f*cking ever they felt like it, with no consequences whatsoever to them. Or allowed banks to send people to low income housing areas and tell the residents there that of course they can afford their own house and I'll help you do it! Or any number of wealth extracting policies and tactics that have occurred over the last three decades. And let's continue busting unions, because when we destroy the private sector's income equalizing apparatus we then leave it to the government to do something about it. And we know how successful the government is in raising taxes on those with more money then god. Middle class consumers have no goddamn money to spend and we're wondering why an economy that relies on 60-70% consumer spending is sputtering along and not creating jobs. Gee. How strange. Clearly deep cuts to the programs those consumers rely on will help...somehow, nevermind how just know that they are totally necessary.
 
2012-12-12 09:32:29 AM

Shaggy_C: Inequality by itself didn't cause anything. It's the "keeping up with the Joneses" mentality that caused the issue. If the middle class had been content with their place in the social hierarchy rather than trying to live beyond their means we wouldn't be in such a conundrum. Their extravagant spending, much of it on credit cards, was what caused the boom period over the last thirty years despite the fact that wages were flat-lining. People should have been more engaged in increasing their gross income rather than using household debt to arrive at a higher quality of life.


Or, a few sensible regulations in the banking sector would have prevented the whole thing.

Change the nature and habits of the entire population or adjust a few rules in the banking sector. Either way. Canada took the sensible banking regulations direction and did fine.
 
2012-12-12 09:34:45 AM

Sm3agol85: Shaggy_C: Apocalyptic Inferno: You can't be this oblivious to reality.

Et tu, Inferno? There's nothing "oblivious" here, it's the cold hard facts. We used to have this concept of fighting for higher wages, it was called "organized labor". You see, in the old days, liberals REPUBLICANS used to actually band together and demand higher pay. Today, you people are just whinging about what has been forced upon you like victims. The reason the rich have won is because they succeeded in turning every man into an island.

[s3.amazonaws.com image 459x720]

And now, Republicans operate on the base of, "you poors should be happy I give you a job".


Fast forward to today and you have Eric Cantor saying "Labor Day is a celebration of 'business' owners, not labor"
 
2012-12-12 09:35:30 AM

vpb: MayoSlather: "If rising income gaps are at least partly responsible for the global credit crisis"

Let's stop right there. If? Partly?

Well, fraudulent financial instruments had a bit to do with it.


Outright thievery is only a crime when committed by the poors
 
2012-12-12 09:38:00 AM

Notabunny: fta But as they'll get little or no help from easy credit today, driving wages down even more risks a cratering of household consumption and a severe test of social cohesion.

Rather than paying wage slaves more money, a better solution is to allow full-time workers access to the company food bank and assistance applying for medicaid.


WalMart already does that, sorta. Don't they have some sort of department that helps employees get public assistance? Because they're basically a shiatty employer?
 
2012-12-12 09:38:52 AM
Fark that! Let the OTHER guy pay his workers a living wage so they can buy my overpriced crap built buy third world slaves.

/ We're in a race to the bottom now
// And these dumbasses think theyre "WINNING!"
 
2012-12-12 09:38:56 AM

Shaggy_C: "keeping up with the Joneses"


aka "the entire basis of our economy".
 
2012-12-12 09:43:17 AM
Supply side economics doesn't work.
 
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