[QUOTE
=stdreb27;2745234]When you have silly stuff like price floors or ceilings. Tariffs, or the double regulation to get the first regulation to work.
Yeah, I know the ins and outs of why this is stupid and effects the true value of goods, I'm talking more about the SEC etc.
You don't have a perfectly and free market the is not a free exchange of true information. On a whole supply and demand will work, with some cops there to make sure you don't do something unethical.
I don't think I'm missing any of the concepts, I've gotten straight A's at two different schools and was a tutor for 2 years. I agree with what you have said, but I fail to see the cops.
You are also missing a key concept, economics doesn't assume people are good, they assume that people are self serving. And they will do what is best for themselves. And that on a whole is what will be better for the county. It is actually a very fun thought. Because by doing what is best for himself, he is doing what is best economically on a whole. With that in mind read the next pp.
And I agree with this, but when corporate lobbyist push their policy, they proclaim that people will do what is good for all. However, I don't think this is true. People will do whatever it takes to make money, and that doesn't mean doing what's best for the economy. Deceiving shareholders, who most are not active in the market b/c their money is in 401K's ect, is not good for the economy.
The problem with the loan system isn't lack of regulation, the problem was their was no risk involved with the people making the loans because they knew a government created "company" would buy the loans good bad and otherwise, the loan company makes their money and all the risk is taken on by Freddy and Fanny. You see a market failure because the "risk" was removed from the equation. Then because they were not operating with the real intent of profit, they could undercut companies who were in that business. That lies the real problem. So people who should have been told no. Were told yes because there was no reason for them to be told no. (self serving) (risk) The next step with the faulty system with no risk would be to get politicians to write regs to fix their first error inadvertently removing risk...
I think we would both agree that the risk should not have been taken away. As any financial management course would say, risk is a major part of the cost portion of the equation.
As for "but the New Deal was one of the best times for this country...economically...and there were major socialist policies going on."
You really think the "great depression" was some of our best times economically?
Want to start doing research on deficit this is where it all started...
After the war there was no depression. War time production took care of the depression and the gov't policies helped transfer these jobs into good middle class ones. At the time of the new deal, the average CEO only made about 20X the average worker, today that number is around 400x (I didn't go check on the numbers so they could be slightly off, but the point is the same.
Lets think about what really caused the great depression. IMO and if your "free trader" profs were worth their salt, I'm sure you've heard of smoot-haley tariffs. After that passed world trade dropped by what 80%. A heavily industrialized nation like ours didn't have any place to sell our products because everyone responded with similar tariffs and it was too expensive to trade world wide. So they had to create something else to take up the slack. And wham you got MASSIVE (for the time and some great national parks) government spending.
Um...no. Overleveraged investors caused the depression...again, lack of regulation. When the downturn happened and people were investing on borrowed money, the stock market plunged. Although the government regulation in the late 1800's wasn't the best either.
