FREE ZONE
A Word From The President of The Wealth System
If you can keep your head when all about you are losing theirs,
you just don't understand the seriousness of the situation!
Now to the REAL reason I'm writing you today ...
I was reading in the Wall Street Journal yesterday, basically how the big R,
yes Virginia, the US is most certainly in Recession, is GOOD for home based business!
For example, Avon reps are increasing and business is booming, going and growing!
I don't need the WSJ to tell me this. I know it already from the number of NEW
members joining The WealthSystem(TM) via F5B, F5M, F5M Millionaires Club, etc.
We had a new fellow, Bob, join us yesterday, who clearly takes his business seriously.
I posted his results at F5M TestiMonies page, he earned over $500 with us, his first day.
I was reading in the Wall Street Journal yesterday, basically how the big R,
yes Virginia, the US is most certainly in Recession, is GOOD for home based business!
For example, Avon reps are increasing and business is booming, going and growing!
I don't need the WSJ to tell me this. I know it already from the number of NEW
members joining The WealthSystem(TM) via F5B, F5M, F5M Millionaires Club, etc.
We had a new fellow, Bob, join us yesterday, who clearly takes his business seriously.
I posted his results at F5M TestiMonies page, he earned over $500 with us, his first day.
ANYWAY, having said all that, here is what I want to SHARE with you today ...
from our good friend at The Washington Post, one of the most thoughtful articles I've seen,
since all this started, and more or less in line with my last "Crystal Ball" article,
which I wrote several months ago in regard to the 4th quarter of this year.
Neither bragging nor complaining, just explaining. I did not like what I saw back then,
and I certainly take no joy in being right in my "gut feeling" prediction,
given the current state of damn near panic in the US markets!
So, with no further ado ... for your consideration ...
Don't Blame Capitalism
By Peter Schiff
Thursday, October 16, 2008; A19
Amid the chaos of recent days, as the federal government has taken gargantuan steps to stabilize the financial markets, realigning the U.S. economic system in the process, comes a nearly universal consensus: This crisis resulted from government reluctance to regulate the unbridled greed of Wall Street. Many economists and market participants who were formerly averse to government interference agree that a more robust regulatory framework must be constructed to cage the destructive forces of capitalism.
For the political left, which has long championed the need for such limits, this crisis is the opportunity of a lifetime.
Absent from such conclusions is the central role the government played in creating the crisis. Yes, many Wall Street leaders were irresponsible, and they should pay. But they were playing the distorted hand dealt them by government policies. Our leaders irrationally promoted home-buying, discouraged savings, and recklessly encouraged borrowing and lending, which together undermined our markets.
Just as prices in a free market are set by supply and demand, financial and real estate markets are governed by the opposing tension between greed and fear. Everyone wants to make money, but everyone is also afraid of losing what he has. Although few would ascribe their desire for prosperity to greed, it is simply a rose by another name. Greed is the elemental motivation for the economic risk-taking and hard work that are essential to a vibrant economy.
But over the past generation, government has removed the necessary counterbalance of fear from the equation. Policies enacted by the Federal Reserve, the Federal Housing Administration, Fannie Mae and Freddie Mac (which were always government entities in disguise), and others created advantages for home-buying and selling and removed disincentives for lending and borrowing. The result was a credit and real estate bubble that could only grow -- until it could grow no more.
Prominent among these wrongheaded advantages are the mortgage interest tax deduction and the exemption of real estate capital gains from taxable income. These policies create unnatural demand for home purchases and a (tax-free) incentive to speculate in real estate.
Similarly, the FHA, Fannie and Freddie were created to encourage lending by allowing primary lenders to turn their long-term risk over to the government. Absent this implicit guarantee, lenders would probably have been much more conservative in approving borrowers and setting interest terms, and in requiring documentation of incomes and higher down payments. Market forces would have kept out unqualified buyers and prevented home-price appreciation from exceeding the growth in household income.
Interest rates contributed the most to creating the housing boom. After the dot-com crash and the slowdown following the attacks of Sept. 11, 2001, the Federal Reserve took extraordinary steps to prevent a shallow recession from deepening. By slashing interest rates to 1 percent and holding them below the rate of inflation for years, the government discouraged savings and practically distributed free money.
Artificially low interest rates invigorated the market for adjustable-rate mortgages and gave birth to the teaser rate, which made overpriced homes appear affordable. Alan Greenspan himself actively encouraged home buyers to avail themselves of these seeming benefits. As monetary policy caused houses to become more expensive, it also temporarily provided buyers with the means to overpay. Cheap money gave rise to subprime mortgages and the resulting securitization wave that made these loans appear safe for investors.
And even today, as market forces deflate the credit bubble, the government is stepping in to re-inflate it. First came the Treasury's $700 billion plan to purchase mortgage assets that no one in the private sector would buy. Now it has recapitalized banks to the tune of $250 billion, guaranteeing loans between banks and fully insuring non-interest-bearing accounts. Policymakers say that absent these steps, banks would not be able to extend loans. But given our already staggering debt burden, perhaps more loans are not the answer. That's what the free market is telling us. But the government cannot abide solutions that ask for consumer sacrifice.
Real credit can be supplied only by savings, so artificial steps to stimulate lending will only produce inflation. By refusing to allow market forces to rein in excess spending, liquidate bad investments, replenish depleted savings, fund capital investment and help workers transition from the service sector to the manufacturing sector, government is resisting the cure while exacerbating the disease.
The United States reached its economic preeminence on the strength of its free markets. So far, the economic disaster exacerbated by government policies is creating opportunities for further government interference, which will lead to bigger catastrophes. Binding the country to a tangle of socialist ideals will seal our fate as a second-rate economic power.
The writer, who was economic adviser for Ron Paul's 2008 presidential campaign, is president of Euro Pacific Capital. He is the author of "The Little Book of Bull Moves in Bear Markets."
IF you are serious about earning money online, I will see YOU here:
F5M Online Conference Room
http://myroom.lgtconference.com/conference.php?id=53907320
Monday Wednesday @ 8 PM EST or Saturday 11:00 AM EST
If You Like Have a Look at The F5M Millionaires Club "FREE" Report
http://www.f5m-millionaires-club.com/freereport?id=mc33mn
If you Would Like To Look At Wealth Team International (WTIA) Which Has been Paying "DAILY" for over 15yrs in over 150 Different Countries. You can join here as well with out the Club. The Choice is yours.
http://www.wtia.net/?id=5912
This Works Has Been working & will Be working after You & I are Gone we will leave this to our kids. Please facts don't lie. I am not asking you to make this your #1. Let it be a nice silent income for you & your team. I do this full time & will do what I can to help you & your team. I am up to date with this. I am pluged in. It is very solid I am on the support team with the "CLUB" let me help you.
Your Friend
Mike Nawoyski
Skype: mnaw40
908-576-7680
mnbestclubintown@gmail.com
you just don't understand the seriousness of the situation!
Now to the REAL reason I'm writing you today ...
I was reading in the Wall Street Journal yesterday, basically how the big R,
yes Virginia, the US is most certainly in Recession, is GOOD for home based business!
For example, Avon reps are increasing and business is booming, going and growing!
I don't need the WSJ to tell me this. I know it already from the number of NEW
members joining The WealthSystem(TM) via F5B, F5M, F5M Millionaires Club, etc.
We had a new fellow, Bob, join us yesterday, who clearly takes his business seriously.
I posted his results at F5M TestiMonies page, he earned over $500 with us, his first day.
I was reading in the Wall Street Journal yesterday, basically how the big R,
yes Virginia, the US is most certainly in Recession, is GOOD for home based business!
For example, Avon reps are increasing and business is booming, going and growing!
I don't need the WSJ to tell me this. I know it already from the number of NEW
members joining The WealthSystem(TM) via F5B, F5M, F5M Millionaires Club, etc.
We had a new fellow, Bob, join us yesterday, who clearly takes his business seriously.
I posted his results at F5M TestiMonies page, he earned over $500 with us, his first day.
ANYWAY, having said all that, here is what I want to SHARE with you today ...
from our good friend at The Washington Post, one of the most thoughtful articles I've seen,
since all this started, and more or less in line with my last "Crystal Ball" article,
which I wrote several months ago in regard to the 4th quarter of this year.
Neither bragging nor complaining, just explaining. I did not like what I saw back then,
and I certainly take no joy in being right in my "gut feeling" prediction,
given the current state of damn near panic in the US markets!
So, with no further ado ... for your consideration ...
Don't Blame Capitalism
By Peter Schiff
Thursday, October 16, 2008; A19
Amid the chaos of recent days, as the federal government has taken gargantuan steps to stabilize the financial markets, realigning the U.S. economic system in the process, comes a nearly universal consensus: This crisis resulted from government reluctance to regulate the unbridled greed of Wall Street. Many economists and market participants who were formerly averse to government interference agree that a more robust regulatory framework must be constructed to cage the destructive forces of capitalism.
For the political left, which has long championed the need for such limits, this crisis is the opportunity of a lifetime.
Absent from such conclusions is the central role the government played in creating the crisis. Yes, many Wall Street leaders were irresponsible, and they should pay. But they were playing the distorted hand dealt them by government policies. Our leaders irrationally promoted home-buying, discouraged savings, and recklessly encouraged borrowing and lending, which together undermined our markets.
Just as prices in a free market are set by supply and demand, financial and real estate markets are governed by the opposing tension between greed and fear. Everyone wants to make money, but everyone is also afraid of losing what he has. Although few would ascribe their desire for prosperity to greed, it is simply a rose by another name. Greed is the elemental motivation for the economic risk-taking and hard work that are essential to a vibrant economy.
But over the past generation, government has removed the necessary counterbalance of fear from the equation. Policies enacted by the Federal Reserve, the Federal Housing Administration, Fannie Mae and Freddie Mac (which were always government entities in disguise), and others created advantages for home-buying and selling and removed disincentives for lending and borrowing. The result was a credit and real estate bubble that could only grow -- until it could grow no more.
Prominent among these wrongheaded advantages are the mortgage interest tax deduction and the exemption of real estate capital gains from taxable income. These policies create unnatural demand for home purchases and a (tax-free) incentive to speculate in real estate.
Similarly, the FHA, Fannie and Freddie were created to encourage lending by allowing primary lenders to turn their long-term risk over to the government. Absent this implicit guarantee, lenders would probably have been much more conservative in approving borrowers and setting interest terms, and in requiring documentation of incomes and higher down payments. Market forces would have kept out unqualified buyers and prevented home-price appreciation from exceeding the growth in household income.
Interest rates contributed the most to creating the housing boom. After the dot-com crash and the slowdown following the attacks of Sept. 11, 2001, the Federal Reserve took extraordinary steps to prevent a shallow recession from deepening. By slashing interest rates to 1 percent and holding them below the rate of inflation for years, the government discouraged savings and practically distributed free money.
Artificially low interest rates invigorated the market for adjustable-rate mortgages and gave birth to the teaser rate, which made overpriced homes appear affordable. Alan Greenspan himself actively encouraged home buyers to avail themselves of these seeming benefits. As monetary policy caused houses to become more expensive, it also temporarily provided buyers with the means to overpay. Cheap money gave rise to subprime mortgages and the resulting securitization wave that made these loans appear safe for investors.
And even today, as market forces deflate the credit bubble, the government is stepping in to re-inflate it. First came the Treasury's $700 billion plan to purchase mortgage assets that no one in the private sector would buy. Now it has recapitalized banks to the tune of $250 billion, guaranteeing loans between banks and fully insuring non-interest-bearing accounts. Policymakers say that absent these steps, banks would not be able to extend loans. But given our already staggering debt burden, perhaps more loans are not the answer. That's what the free market is telling us. But the government cannot abide solutions that ask for consumer sacrifice.
Real credit can be supplied only by savings, so artificial steps to stimulate lending will only produce inflation. By refusing to allow market forces to rein in excess spending, liquidate bad investments, replenish depleted savings, fund capital investment and help workers transition from the service sector to the manufacturing sector, government is resisting the cure while exacerbating the disease.
The United States reached its economic preeminence on the strength of its free markets. So far, the economic disaster exacerbated by government policies is creating opportunities for further government interference, which will lead to bigger catastrophes. Binding the country to a tangle of socialist ideals will seal our fate as a second-rate economic power.
The writer, who was economic adviser for Ron Paul's 2008 presidential campaign, is president of Euro Pacific Capital. He is the author of "The Little Book of Bull Moves in Bear Markets."
IF you are serious about earning money online, I will see YOU here:
F5M Online Conference Room
http://myroom.lgtconference.com/conference.php?id=53907320
Monday Wednesday @ 8 PM EST or Saturday 11:00 AM EST
If You Like Have a Look at The F5M Millionaires Club "FREE" Report
http://www.f5m-millionaires-club.com/freereport?id=mc33mn
If you Would Like To Look At Wealth Team International (WTIA) Which Has been Paying "DAILY" for over 15yrs in over 150 Different Countries. You can join here as well with out the Club. The Choice is yours.
http://www.wtia.net/?id=5912
This Works Has Been working & will Be working after You & I are Gone we will leave this to our kids. Please facts don't lie. I am not asking you to make this your #1. Let it be a nice silent income for you & your team. I do this full time & will do what I can to help you & your team. I am up to date with this. I am pluged in. It is very solid I am on the support team with the "CLUB" let me help you.
Your Friend
Mike Nawoyski
Skype: mnaw40
908-576-7680
mnbestclubintown@gmail.com
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