Obama admin has done a good job managing the economic crisis of Bush

#526
#526
Vol8188 said:
I do understand that the capital they have deposited at the federal reserve and the amount they lend are different. But I'm not seeing their benefit under inflation. I assumed it would still erode their earnings.

What is the benefit that I am overlooking?
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Banks hold a tremendous amount of physical assets ie real estate.
 
#527
#527
Vol8188 said:
I do understand that the capital they have deposited at the federal reserve and the amount they lend are different. But I'm not seeing their benefit under inflation. I assumed it would still erode their earnings.

What is the benefit that I am overlooking?
Click to expand...

It has nothing to do with the federal reserve. To oversimplify it. If a bank has $100 in deposits and the fractional reserve requirement is 10%, the bank can make a loan of $1,000. The recipient of the loan has to pay interest on the full amount, even though the bank created it out of thin air. So the bank doesn't lose money on the asset during a deflationary environment, because it never had an asset. The only risk is default on the loan.

Again, that is an oversimplification of the process. In reality there are several banks in the chain making loans and transferring reserves back and forth. But it is a good illustration.
 
#528
#528
red butler said:
It has nothing to do with the federal reserve. To oversimplify it. If a bank has $100 in deposits and the fractional reserve requirement is 10%, the bank can make a loan of $1,000. The recipient of the loan has to pay interest on the full amount, even though the bank created it out of thin air. So the bank doesn't lose money on the asset during a deflationary environment, because it never had an asset. The only risk is default on the loan.

Again, that is an oversimplification of the process. In reality there are several banks in the chain making loans and transferring reserves back and forth. But it is a good illustration.
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Is the deposit we are speaking of not held at the federal reserve? If not, where?
 
#530
#530
Vol8188 said:
Is the deposit we are speaking of not held at the federal reserve? If not, where?
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Physical cash barely exists anymore, so I guess banks keep most deposits on a server somewhere. They have recently started putting excess reserves with the federal reserve, but that's mainly because the Fed now pays interest.
 
#531
#531
Vol8188 said:
Is the deposit we are speaking of not held at the federal reserve? If not, where?
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reserve requirements are either held as physical cash in a bank vault at the depository institution or they are deposited at the regional federal reserve bank
 
#532
#532
red butler said:
Physical cash barely exists anymore, so I guess banks keep most deposits on a server somewhere. They have recently started putting excess reserves with the federal reserve, but that's mainly because the Fed now pays interest.
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Correct me if I"m wrong as I am no bank official but I believe reserves are kept as physical cash in a vault at the depository institution or deposited at the regional federal reserve bank.

Also not all banks store excess reserves at the federal reserve as reserve credit. Some of that money may be loaned to other banks who are short on reserve requirements or it may be physically held by the bank instead.
 
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#533
#533
theFallGuy said:
Correct me if I"m wrong as I am no bank official but I believe reserves are kept as physical cash in a vault at the depository institution or deposited at the regional federal reserve bank.

Also not all banks store excess reserves at the federal reserve as reserve credit. Some of that money may be loaned to other banks who are short on reserve requirements or it may be physically held by the bank instead.
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I believe you are correct. I've also read that banks can convert their reserves to other assets ie gold, foreign currencies, bonds etc.
 
#535
#535
hog88 said:
Man, every front runner for POTUS back then would have done the same. Remember Obama saved GM and Killed Osama.

But in all seriousness, you need to learn what corporate subsidies are vs bailouts/welfare. A section 179 tax deduction isn't corporate welfare.
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It is in the liberal/socialist world.
 
#536
#536
Carl Pickens said:
I still can't get over why people b!tch about companies getting tax breaks.....
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Pretty simple really. The liberals believe that the .gov is the only way that people should survive. Cradle to grave dependency. They believe that corporations are nothing but large piggy banks to rob and steal from. They believe that when those corporations' tax breaks are removed that they should... out of the goodness of their hearts... hire more people to pay their tax bill. It's lunacy. The .gov doesn't have to make a profit, nor God forbid even break even because they have an endless supply of people to steal from. And we keep re-electing them over and over and over. And hold up a community organizer that has taken 1/6th of the economy under .gov control... and there are still people like 8188 that defend this. Amazing.

If I were king, Bill Gates and Warren Buffet would not pay tax dollar one because THEY have created more pure taxpayers than the .gov ever will. And their taxpayers' monies are pure in that they are not recycled dollars that the .gov has taken from taxpayers and given to .gov employees... and then taken back yet again.

Think about that for a moment.

They take YOUR money, and give a portion of it to a .gov employee. Then they take a portion of THAT money back in taxes....
 
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#537
#537
Vol8188 said:
I've never said anything about wanting to support people who don't work. I've always maintained that their are many people working 40 hrs a week or more at jobs that simply don't pay them enough.

Why is it alright to give corporations a tax break or subsidies, but not these people?
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So then you would be good with cancelling welfare and SNAP after a reasonable time... like a year?
 
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#539
#539
govols/cc said:
They get a break at the end of the year. Most of these people get more welfare from the irs in the form of thousands of dollars in refunds. I've never gotten $5k+ in a refund but know many who do and it's gone in a week or two.
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Under ObolaCare it will be gone before they even see it now :rock:
 
#540
#540
SpaceCoastVol said:
So then you would be good with cancelling welfare and SNAP after a reasonable time... like a year?
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No. There's plenty of people who work 40+ hours a week and still can't afford basic necessities.

I would be cool with ending obama phones though.
 
#541
#541
SpaceCoastVol said:
Pretty simple really. The liberals believe that the .gov is the only way that people should survive. Cradle to grave dependency. They believe that corporations are nothing but large piggy banks to rob and steal from. They believe that when those corporations' tax breaks are removed that they should... out of the goodness of their hearts... hire more people to pay their tax bill. It's lunacy. The .gov doesn't have to make a profit, nor God forbid even break even because they have an endless supply of people to steal from. And we keep re-electing them over and over and over. And hold up a community organizer that has taken 1/6th of the economy under .gov control... and there are still people like 8188 that defend this. Amazing.

If I were king, Bill Gates and Warren Buffet would not pay tax dollar one because THEY have created more pure taxpayers than the .gov ever will. And their taxpayers' monies are pure in that they are not recycled dollars that the .gov has taken from taxpayers and given to .gov employees... and then taken back yet again.

Think about that for a moment.

They take YOUR money, and give a portion of it to a .gov employee. Then they take a portion of THAT money back in taxes....
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If government employees were simply given lower tax free salaries (the way a lot of military benefits are done), what difference would it make? Either pay them more and tax them or pay them less with no taxes.

It sounds like a wash to me.
 
#546
#546
hog88 said:
You do realize we have suffered a pretty high inflation rate over the last 6 years, right? I mean real inflation not what the government publishes. Things like energy and food costs, the stuff we absolutely have to have but are not calculated in the numbers.
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How can this be? We have all these new "investments' the .gov made in renewable energy. Aren't YOU driving a new pollution free vehicle now? Get with the times man.
 
#550
#550
Vol8188 said:
No. There's plenty of people who work 40+ hours a week and still can't afford basic necessities.

I would be cool with ending obama phones though.
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Why can't they afford them? Because they dropped out of junior high school and can't get anything but slinging fries at McD's? And they chose to have 4 or 5 kids? I'm paying for their housing, their kids' education (if THEY are bright enough to continue to go to school), their health care, their cigarettes and booze...

So why is that MY problem? I work hard for my money. Why is it so much to ask to let me keep more of it?
 
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