Postal Service Is Nearing Default as Losses Mount

[DiscoBiscuit]

The bailout bonanza really started when NYC went belly up and the Europeans told Ford if he didn't bail out NY the world would fall apart. Mutually assured destruction. So he did. This continued with the S&L crisis, 2008 financial collapse, and now finally onto the end game which is sovereign debt and currency bailouts. The bailouts aren't because of recent deregulation. This has been going on for a while. We are at the point now where almost everyday someone or something is bailed out. This is moral hazard. We have insulated the ruling corporate oligarchs from risk which in turn will lead to economic collapse much like Rome. Moral Hazard is the slayer of empires.


Moral hazard spreads to the populace in the end game. It is a disease.


It can't. We've all been robbed basically. Happened once in the 1930's and this is consolidation #2. It's what happens when we allow central bankers to run the world. Fair? No. To be expected? Yes.

If you're going to reference economic history, please consider taking a look at all of it. Especially robber baron and record income-disparity history. Ah, forget it. That's a bad idea. I mean, that old saying that 'those who forget history are doomed to repeat'? Just words.

 

[SpasticGramps]

I mean, that old saying that 'those who forget history are doomed to repeat'? Just words.

Kind of how I feel about all this money printing and bailouts. We think we are smarter this time around and can get away with it.

Just words right?

 

[Weed-Luver]

robber baron is such an over used word...get rid of the need for greed and we can all be freed from bailout's...greed destroy's..it doomed rome and every other empire..
i must have it all and now..

 

[SpasticGramps]

Wanting it all now is moral hazard.

Greed isn't moral hazard btw. Or "wanting it all right now" doesn't constitute moral hazard when talking about economics.

Moral Hazard from Wiki

In economic theory, moral hazard is a situation in which a party insulated from risk behaves differently from how it would behave if it were fully exposed to the risk.

Moral hazard arises because an individual or institution does not take the full consequences and responsibilities of its actions, and therefore has a tendency to act less carefully than it otherwise would, leaving another party to hold some responsibility for the consequences of those actions.

 

[Weed-Luver]

sorry SP greed is usally what leads these companies down that path..

 

[DiscoBiscuit]

Kind of how I feel about all this money printing and bailouts. We think we are smarter this time around and can get away with it.

Just words right?

Maybe so. But when we've got something we know produced the greatest income disparity in the history of our country, why would we want to go back? Maybe we're smarter than we were then?

Thing is, some things don't change. The fox never was a good sentry of the chicken house but we forgot.

Glass Stegall and other critical regulations didn't slice bread and vacuum the rug. But for the exact same number of years GS was in force, Wall Street didn't clean our clock. They only cleaned each others.

I don't imagine regulation is the best system money can buy. But it's the best one we ever bought (in the macro.) Too bad that managed finance equates to deprivation of freedom because freedom is goddamn expensive. I'm referencing a top capitalist, wish I'd remembered to catch his name.

US business isn't waiting for further incentives to put people to work. 45 million need full-time employment and can't buy the stuff business makes. Thirty years of placating their whims has diminished our role as individuals and low-tax capital gains and tax havens sustain their livelihoods just fine. They want us to work harder and produce more for them. In 2000, the average US worker netted their employer $10k in profits annually. That figure is $15k today.

I think the turnip's starting to bleed.

"Let me warn you and let me warn the Nation against the smooth evasion which says, "Of course we believe all these things; we believe in social security; we believe in work for the unemployed; we believe in saving homes. Cross our hearts and hope to die, we believe in all these things; but we do not like the way the present Administration is doing them. Just turn them over to us. We will do all of them- we will do more of them we will do them better; and, most important of all, the doing of them will not cost anybody anything." - FDR

 

[SpasticGramps]

sorry SP greed is usally what leads these companies down that path..

Greed yes, but government's propping up failed institutions and rewarding excessive greed is what causes moral hazard to permeate and eventually destroy an empire.

I would argue that it's the government's lust for power which leads to corruption and collectivism and thus the inevitable introduction of widespread toxic moral hazard as they scramble to prop up failed and corrupted institutions. I don't really differentiate between corporations and our government. The government is a full subsidiary of the corporation (The Federal Reserve).

Greed and moral hazard are not the same thing though. Greed is a natural instinct. I don't believe you will ever get rid of it no more than you can get rid of fear.

 

[SpasticGramps]

I like GS. I think we need rules to abide by. I'm not anti-regulation. I just think that that conversation is useless until the crony capitalism system (fascist system) that we have now collapses and is completely retooled.

Rules are good. They are useless unless they apply to everyone though. When there is a class that lives outside the law totalitarianism thrives. This is what we have now lawless for the people at the top and tyranny for those at the bottom.

 

[DiscoBiscuit]

Greed yes, but government's propping up failed institutions and rewarding excessive greed is what causes moral hazard to permeate and eventually destroy an empire.

Government propping up failed institutions isn't reward. Reward comes in the form of record income disparity. We could follow the romance of allowing the folks that still peddle the economy to wither on the vine but what would happen after that?

I mean, I like my way of thinking but I've run into a few obstacles along the way. When one of my methods needs better management I don't long for the days of my worser idea, let alone worsest.

I would argue that it's the government's lust for power which leads to corruption and collectivism and thus the inevitable introduction of widespread toxic moral hazard as they scramble to prop up failed and corrupted institutions.

Yeah, when laissez fairre capitalists manage to lobby away regulation, they make sure to get us all back in the form of record income disparity. We should never make new regulation, for the top will become even greedier and blame it on us. Greed really knows no bounds.

I don't really differentiate between corporations and our government. The government is a full subsidiary of the corporation (The Federal Reserve).

The negative common denominator between business and government is money.

Sometimes I get the idea you'd idealize your calculator. j/k

Greed and moral hazard are not the same thing though. Greed is a natural instinct. I don't believe you will ever get rid of it no more than you can get rid of fear.

Greed is a natural instinct... what a great argument for regulation. Hey man, we're personally regulated against ripping off the private sector - IMO, they should be regulated against ripping us off.

 

[Hash Zeppelin]

i think your original post title is right on, default, default is not necessarily the end of the USPS
i don't think default will happen, some deal will be cut, but that will happen at the 11th hour, when other deals get slithered through as part of it
but everyone is relieved the post office is still open, so the other crap is noticed less

if the banks got bailed out twice then the CONSTITUTIONALLY MANDATED USPS will too.

Default leads to bankruptcy; but with who? The US Government that's who. So..... who cares if a government organizations defaults to it's government that was one day from defaulting on it's debt. So is China gonna come over here and shut it down? I think not.

 

[igrowone]

if the banks got bailed out twice then the CONSTITUTIONALLY MANDATED USPS will too.

Default leads to bankruptcy; but with who? The US Government that's who. So..... who cares if a government organizations defaults to it's government that was one day from defaulting on it's debt. So is China gonna come over here and shut it down? I think not.

the default here would to be to government workers(retired ones)
definitely not the end the United States as we know it, and there will be no default
Congress just doesn't want to deal with it any sooner than they have to