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Thread: You'll not be able to answer this because you're retarded

  1. #1

    Default You'll not be able to answer this because you're retarded

    If all money created is debt and counts as principal, where does the money come from to pay interest on this debt?

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    Semi-Benevolent Dictator Euskadi's Avatar
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    Default Re: You'll not be able to answer this because you're retarded

    You've probably not even bought a share in your whole entire life
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  3. #3
    Suck One jquinn's Avatar
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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Jameeyy View Post
    If all money created is debt and counts as principal, where does the money come from to pay interest on this debt?
    More than 95% of the money in the world is electronic (not cash). Banks essentially "create" money that is then loaned out and flows through the economy. Money is basically just accounting entries on banks' balance sheets.

  4. #4

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by jquinn View Post
    More than 95% of the money in the world is electronic (not cash). Banks essentially "create" money that is then loaned out and flows through the economy. Money is basically just accounting entries on banks' balance sheets.
    So its an inevitable crash?

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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Jameeyy View Post
    So its an inevitable crash?
    Not necessarily. Banks are fairly regulated in terms of how much money they can circulate (capital requirements, etc.). A crash would result from an economic disaster rather than a monetary one in my opinion.

  6. #6

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by jquinn View Post
    Not necessarily. Banks are fairly regulated in terms of how much money they can circulate (capital requirements, etc.). A crash would result from an economic disaster rather than a monetary one in my opinion.
    No they are not. Anglo-Irish bank was not regulated when they got bailed out did they?

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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Jameeyy View Post
    No they are not. Anglo-Irish bank was not regulated when they got bailed out did they?
    All banks have capital requirements, which is determined by regulations. The banks that were bailed out just didn't have enough underlying capital to withstand their massive losses.

  8. #8

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by jquinn View Post
    All banks have capital requirements, which is determined by regulations. The banks that were bailed out just didn't have enough underlying capital to withstand their massive losses.
    They had a liquidity problem, which is the prepensity of a crash; what makes it inevitable over and over because the money wasn't there in the first place…

  9. #9

    Default Re: You'll not be able to answer this because you're retarded

    Said it before but JQ is the go to go guy on here for economics.

  10. #10
    Suck One jquinn's Avatar
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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Jameeyy View Post
    They had a liquidity problem, which is the prepensity of a crash; what makes it inevitable over and over because the money wasn't there in the first place…
    Eh, kind of. There was a problem because all bank assets are marked to market, so when the value of those assets crashed, the banks didn't have enough capital to cover it. They still had capital (as required by regulation), it just didn't happen to be enough to cover their losses.

  11. #11

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Euskadi View Post
    Boom. There is your answer.

    Thread closed, bitches.
    The thumb - proving Lofty and lolercoaster wrong since 2014

  12. #12

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by jquinn View Post
    Eh, kind of. There was a problem because all bank assets are marked to market, so when the value of those assets crashed, the banks didn't have enough capital to cover it. They still had capital (as required by regulation), it just didn't happen to be enough to cover their losses.
    Its not kind of. Its a fact. The fact the banks are lending which has inflated the economy by design has made dogshit assets which inevitably made a crash, it will happen again and again and again and again. Its all bullshit for the elite in Finance to gain more money.

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    Suck One jquinn's Avatar
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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Jameeyy View Post
    Its not kind of. Its a fact. The fact the banks are lending which has inflated the economy by design has made dogshit assets which inevitably made a crash, it will happen again and again and again and again. Its all bullshit for the elite in Finance to gain more money.
    The crash was due to a market bubble more than a liquidity issue. I'm not sure what you're arguing here...

  14. #14

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by jquinn View Post
    The crash was due to a market bubble more than a liquidity issue. I'm not sure what you're arguing here...
    That contradicts what you're stating, without the liquidity it makes a market bubble as its just issued debt

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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Jameeyy View Post
    That contradicts what you're stating, without the liquidity it makes a market bubble as its just issued debt
    A liquidity issue implies that the intrinsic value of an asset is much lower than its market valuation. I'm suggesting that wasn't really the case.

  16. #16

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by jquinn View Post
    A liquidity issue implies that the intrinsic value of an asset is much lower than its market valuation. I'm suggesting that wasn't really the case.
    Yes it was, have you looked at the accounts of Twitter recently? They are running at a loss, while their stock price continues to climb. That right their is a bubble.

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    Suck One jquinn's Avatar
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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Jameeyy View Post
    Yes it was, have you looked at the accounts of Twitter recently? They are running at a loss, while their stock price continues to climb. That right their is a bubble.
    Twitter runs at ~30% EBITDA margins

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    Semi-Benevolent Dictator Euskadi's Avatar
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    Default Re: You'll not be able to answer this because you're retarded

    Uber run at huge losses too don't they? but just cover them with investments

  19. #19
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    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by Euskadi View Post
    Uber run at huge losses too don't they? but just cover them with investments
    Yeah, it could be profitable but it's trying to keep up it's absurd growth rate so it is spending a ton on trying to continually enter and take over new markets. As a private company, it can get away with this strategy moreso than a public one.

  20. #20

    Default Re: You'll not be able to answer this because you're retarded

    Quote Originally Posted by jquinn View Post
    Twitter runs at ~30% EBITDA margins
    No doubt about it, they use short-medium debts to grow and heavily rely on marketing which at its current trend will show them explode, they are in a bubble.

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