Our financial system is crumbling this week.

[Popeye_Card]

Perhaps cracking down on this would be a good place to start.

(spoilered for large size)

[SHOW]

[Arthur Dent]

Household debt has increased in large part due to the bubble in housing prices. It should decrease with falling prices. As far as the negative savings rates goes, we've been encouraging people to do that to stimulate the economy. Probably wasn't the greatest idea.

[Popeye_Card]

Household debt has increased in large part due to the bubble in housing prices. It should decrease with falling prices. As far as the negative savings rates goes, we've been encouraging people to do that to stimulate the economy. Probably wasn't the greatest idea.

House prices are not going to fall at the same rate they went up. They have to fall a LONG way just to get down to the same average rate of median income growth. I don't think anyone (OK, maybe renters) wants the housing market to fall that far.

[lukethedrifter]

Household debt has increased in large part due to the bubble in housing prices. It should decrease with falling prices. As far as the negative savings rates goes, we've been encouraging people to do that to stimulate the economy. Probably wasn't the greatest idea.

But this isn't just a recent phenomenon. This is essentially required for our economy to work given the accepted economic model, no?

[TimeForGuinness]

Still, you were calling for depression as an alternative to a moderate increase in debt. I think that's crazy.

Well, I also think it's important that the people of this generation realize the ramifications of their actions, rather than just getting bailed out again. Sometimes you have to learn the hard way. For the last 20+ years, we've all been having our cake and eating it too.

I don't think depression means what you think it means.

OK, maybe I don't want a full-scale depression to the point where the US becomes an afterthought in world economics, but I sure as heck don't want this continuous cycle of bail-outs as soon as things look shaky. The system will eventually fail. I think it's selfish of us to keep putting it off to tomorrow's generation.

Depression for some, little American flags for others!

[arnie.k]

one thing is clear, you've got your work cut out for you for years to come just to get back to normalcy.

some constructive suggestions i think would help:

- encourage savings by subsidizing it. in israel, about 20% of my salary is tax exempt as long as i save it in a long term plan. this is partly my pension plan (which is tax exempt), and parts of it open up for my disposal every 6th year (about a year's salary).

- reiterate anti-trust laws to fit the current economy. having multi-billion corporations whose collapse could cripple the economy is a recipe for disaster. you're practically telling management, you can screw up as much as you want, taxpayers will have to save you.

- stimulate the economy by encouraging immigration. this is counter-intuitive i admit, but israel's recent history shows that an increase of about 20% in the population like we felt during the 90's revitalized the housing markets, decreased unemployment over the long term (although it got much worst at first, really bad for about 3 years), and got us out of a pretty bad recession.

i'll stop offering the advice of a complete amateur know-nothing now

[jim]

one thing is clear, you've got your work cut out for you for years to come just to get back to normalcy.

some constructive suggestions i think would help:

- encourage savings by subsidizing it. in israel, about 20% of my salary is tax exempt as long as i save it in a long term plan. this is partly my pension plan (which is tax exempt), and parts of it open up for my disposal every 6th year (about a year's salary).

- reiterate anti-trust laws to fit the current economy. having multi-billion corporations whose collapse could cripple the economy is a recipe for disaster. you're practically telling management, you can screw up as much as you want, taxpayers will have to save you.

- stimulate the economy by encouraging immigration. this is counter-intuitive i admit, but israel's recent history shows that an increase of about 20% in the population like we felt during the 90's revitalized the housing markets, decreased unemployment over the long term (although it got much worst at first, really bad for about 3 years), and got us out of a pretty bad recession.

i'll stop offering the advice of a complete amateur know-nothing now

I put 15K per year in my retirement plan (that's the max by the way) pre tax. You can also take money out pretax for things like medical expenses etc... So at least for the long term stuff you can do that here as well.

[Popeye_Card]

I put 15K per year in my retirement plan (that's the max by the way) pre tax. You can also take money out pretax for things like medical expenses etc... So at least for the long term stuff you can do that here as well.

The rise in popularity of 401k's and IRA's helps explain why savings rates plummet, while the Dow Jones consistently rises.

[arnie.k]

one thing is clear, you've got your work cut out for you for years to come just to get back to normalcy.

some constructive suggestions i think would help:

- encourage savings by subsidizing it. in israel, about 20% of my salary is tax exempt as long as i save it in a long term plan. this is partly my pension plan (which is tax exempt), and parts of it open up for my disposal every 6th year (about a year's salary).

- reiterate anti-trust laws to fit the current economy. having multi-billion corporations whose collapse could cripple the economy is a recipe for disaster. you're practically telling management, you can screw up as much as you want, taxpayers will have to save you.

- stimulate the economy by encouraging immigration. this is counter-intuitive i admit, but israel's recent history shows that an increase of about 20% in the population like we felt during the 90's revitalized the housing markets, decreased unemployment over the long term (although it got much worst at first, really bad for about 3 years), and got us out of a pretty bad recession.

i'll stop offering the advice of a complete amateur know-nothing now

I put 15K per year in my retirement plan (that's the max by the way) pre tax. You can also take money out pretax for things like medical expenses etc... So at least for the long term stuff you can do that here as well.

the actual numbers are 23%. 10% is short term (6 years), 13% is long term (till i retire).

there's also a government subsidized pension for every citizen. an equivalent to a minimum wage salary that's additional to everyone's saved retirement plan. obviously this helps people who had a low income more than it helps people who had a large salary, but i guess that's the idea.

medical expenses come out to none here (or nearly none). we have a national health-plan that makes medical expenses 0 for most people.

this should be also enforced in law (the fact you do it, doesn't mean everyone's saving). i don't have a choice about those 23%.

[jim]

one thing is clear, you've got your work cut out for you for years to come just to get back to normalcy.

some constructive suggestions i think would help:

- encourage savings by subsidizing it. in israel, about 20% of my salary is tax exempt as long as i save it in a long term plan. this is partly my pension plan (which is tax exempt), and parts of it open up for my disposal every 6th year (about a year's salary).

- reiterate anti-trust laws to fit the current economy. having multi-billion corporations whose collapse could cripple the economy is a recipe for disaster. you're practically telling management, you can screw up as much as you want, taxpayers will have to save you.

- stimulate the economy by encouraging immigration. this is counter-intuitive i admit, but israel's recent history shows that an increase of about 20% in the population like we felt during the 90's revitalized the housing markets, decreased unemployment over the long term (although it got much worst at first, really bad for about 3 years), and got us out of a pretty bad recession.

i'll stop offering the advice of a complete amateur know-nothing now

I put 15K per year in my retirement plan (that's the max by the way) pre tax. You can also take money out pretax for things like medical expenses etc... So at least for the long term stuff you can do that here as well.

the actual numbers are 23%. 10% is short term (6 years), 13% is long term (till i retire).

there's also a government subsidized pension for every citizen. an equivalent to a minimum wage salary that's additional to everyone's saved retirement plan. obviously this helps people who had a low income more than it helps people who had a large salary, but i guess that's the idea.

medical expenses come out to none here (or nearly none). we have a national health-plan that makes medical expenses 0 for most people.

this should be also enforced in law (the fact you do it, doesn't mean everyone's saving). i don't have a choice about those 23%.

I see. No, definitely not the law here and I know I'm in the minority doing anything at all let alone the max.