The Economic Collapse

[SoonerCoug]

I posted this for Lingo in a separate thread, but I think this deserves its own thread. It's the untold story of the electronic run on the banks that could have destroyed our world as we know it.

Kanjorski: "Here's the facts: On Thursday at about 11:00 in the morning the Federal Reserve noticed a tremendous draw down of money market accounts to the tune of 550 billion dollars in a matter of an hour or two. The treasury opened up its window to help. They pumped 105 billion dollars into the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks. They decided to close the operation--close down the money accounts, and announce a guarantee of 250,000 dollars per account so there wouldn't be further panic. If they had not done that, their estimation was that by 2:00 that afternoon, 5.5 trillion dollars would have been drawn out of the money market system of the US, would have collapsed the entire economy of the United States, and the entire world economy would have collapsed. Now we talked at that time about what would happen if that happened. It would have been the end of our economic and political system as we know it."

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[JohnnyLingo]

I like that I'm an ignoramus for not knowing these details... and apparently you've decided there plenty more ignoramuses on the board, since you decided to make this its own thread.

You're funny.

[SoonerCoug]

I like that I'm an ignoramus for not knowing these details... and apparently you've decided there plenty more ignoramuses on the board, since you decided to make this its own thread.

You're funny.

And you're an imbecile. Read your own words:

Can you direct me to somewhere that explains how Bernanke's actions mean unemployment is at 9.5% today instead of substantially higher? I hear this argument a lot, but I've yet to find anywhere that simply shows how this happened.

I don't see many others understating the seriousness of the crisis or the importance of intervention.

I posted this because it's nice to hear this account.

[myboynoah]

I'm confused.

I thought the talk surrounding potential 10% unemployment centered primarily on Obama's economic stimulus package and it not being the right kind of stimulus, not the financial bailout package.

[il Padrino Ute]

I'm confused.

I thought the talk surrounding potential 10% unemployment centered primarily on Obama's economic stimulus package and it not being the right kind of stimulus, not the financial bailout package.

That's what we were told, wasn't it?

Someone has some 'splainin to do.

[SoonerCoug]

I'm confused.

I thought the talk surrounding potential 10% unemployment centered primarily on Obama's economic stimulus package and it not being the right kind of stimulus, not the financial bailout package.

I'm completely open to the possibility that the stimulus has done less than it was supposed to do. I was mostly just saying that without intervention, we would have no economy to speak of.