[acidhead43]

Ron Paul: This Bailout Won't Be the Last
September 19, 2008 05:35 PM ET | Luke Mullins | http://www.usnews.com/blogs/the-home-fr ... -last.html

I recently chatted with Rep. Ron Paul (R-Texas) about the gigantic financial bailout that the government is preparing to undertake.

Some excerpts from the interview:

What's your take on this huge financial bailout?
"It's more of the same. More debt and more inflation and more pressure on the dollar. Ultimately, although the markets are responding very favorably at the moment, I think it is going to be devastating to the dollar and to our financial situation in this country."

But don't we need to get these toxic assets off banks' balance sheets?
"Sure, they need to be removed. Somebody needs to suffer the consequences not the taxpayer. Everybody knows that they have to be removed. They are priced too high. The assets don't have real value—some have zero and some have 10 cents on the dollar.

The people who had been making profits for all these years and dealing in all of this debt creation and derivatives—that now is becoming unwound—are claiming that it would be so painful if somebody went bankrupt and therefore we have to put so much burden on the taxpayer and on the dollar because the alternative is worse. But quite frankly, if they destroy the dollar and the dollar system, then they have a much bigger problem that they are going to have to deal with and it would be the collapse of the whole international monetary system—which is conceivable."

So instead of having taxpayers buy the bad debt, the market should take care of it by itself?
"Sure, prices need to go down. Bad debt needs to be eliminated. The taxpayer ought to be protected. Taxes ought to be lowered...We are following the same routine that we did in the Depression, and that is artificially try to keep prices up. People were starving in the Depression and the only thing they did was try to keep wages artificially high and keep food prices high. We are doing the same thing now—we are trying to keep housing prices high.

So you think the government should not have bailed out an y companies during this crisis?
"That would have been the best thing. It would have been painful, but housing prices would have come down sharper and faster, and it would have been over by now.
What we've been doing now—especially since 1971—is preventing the real liquidation of the malinvestment and the excess of debt . . . If this process continues, we're going to own General Motors and Ford, then we will have to own the airlines. We are socializing our country without even a vote by the Congress. It's a horrible situation."

Will this bailout stabilize the crisis?
"I personally don't think so. It might be temporary, but no, there is much more involved. I mean, we are talking about trying to unwind trillions of dollars of derivatives . . . You have to get rid of all that stuff."

Will this bailout be the last?
"No, no. This won't be the last one. There will be something else later on. But that doesn't mean you might not have a few months of a reprieve. But it will continue."

Will we have to bail out the auto makers?
"Oh I think so. We are not going to let them fail. Our policy is such that everybody gets bailed out. It's like a drug addict, they've got to take their fix. It's too tough getting off these drugs. And the drug here is easy credit.

[Bruce_the_vii]

I sort of see this as the right wing loonie swamp. The free market would work fine if only people would let it. In actual fact he doesn't have the slightest idea what the free market would bring, not that that would stop him.

[tritium]

Ron Paul on Glenn Beck



Ron Paul on the Financial Crisis



More Ron Paul Videos: http://www.ronpaul.com/videos/

[acidhead43]

Bruce_the_vii Bruce_the_vii:

I sort of see this as the right wing loonie swamp. The free market would work fine if only people would let it. In actual fact he doesn't have the slightest idea what the free market would bring, not that that would stop him.

Ron Paul is no stranger to studying the complete history of the American monetary system...

...how many books have you wrote on economics?

......feel free to enlighten us...the stage is yours....

[Toro]

America has a long history of bailouts so Ron Paul is almost certainly correct.

[Bruce_the_vii]

acidhead43 acidhead43:

Bruce_the_vii Bruce_the_vii:

I sort of see this as the right wing loonie swamp. The free market would work fine if only people would let it. In actual fact he doesn't have the slightest idea what the free market would bring, not that that would stop him.

Ron Paul is no stranger to studying the complete history of the American monetary system...

...how many books have you wrote on economics?

......feel free to enlighten us...the stage is yours....

Why just the other day I read an article in the newspaper that was an interview with the former Govenor of the Bank of Canada, David Dodge. He said that the Central Bank Chiefs knew in 2003 that there was going to be a financial disaster because of the American mortage markets but that he didn't realize the extent of the fallout. David Dodge was not only expert but has a large, well funded staff and access to just about every expert in the world to assist him. These things are a little complex and people on the street know that.

Myself I read "Banks, Financial Institutions and Money" just for the fun of it a couple of years ago.

I did also write a book on economics featuring the idea the basic concept of the Knowledge Economy that is directing the emerging economies could apply to the problems in our formerly rich cities like Toronto. However 90% of it is about people's reaction to our backsliding economy. It remains unpublished. It's 206 pages.

While my book remains unpublished my ideas have circulated and back in the days of Chretien I counted favourable response from 83 Liberal MPs. Almost no response from the NDP and Conservatives. I have not been able to contact Martin and Dion, let alone interest them in new ideas.