The catastrophe is the core issue - and the question Bega

Master economic Bega (Gary Becker) on October 7 in "The Wall Street Journal" published an article saying that all people are made of water from the wind Chung, to the dark days of Ukraine's historic financial disaster of the Earth who "optimistic" view of the Article. Friends have asked me to comment. After going over the text, saying that "optimistic" that the possible effect on the text of the subject, and the media is often not the subject of the author's own play. Yun title: We're Not Headed for a Depression - No, this isn't the crisis that kills global capitalism ( "We are not going to the Great Depression - no, this crisis will not kill the earth's capitalism "). Reading the text, Mo Buzhun I think what Tony brother. Is not a criticism: No one can touch the prospective place in what is the thing. Too complex, too confusing, I have been a slingshot in hand, began to fear that chess Doubu Guo brother Tony. First of all, Bega that the current financial turmoil of the last century and the 1930s, is a pediatrician because of unemployment and the output from these two areas, the current national income in the United States has not decreased, while the unemployment rate by only 6.1. Those of the 1930s and 25 percent of national income and the unemployment rate drop is not mentioned in the same breath. He believes that the current unemployment rate in the United States and the deterioration of the national income will be, but not close to the situation in the 1930s. 1930 is history, we read history, do you read me to read, add a little more or less to the imagination of the individual, not the same feeling. My feeling is that today's financial crisis, with the wind speed, explosion and shock, the breadth and the huge amount of these areas, compared with the 1930s is a pediatrician, is a pale into insignificance. Other things aside, today, there has been a Britain of the Atlantic, the incident occurred just ten days on the safe were sold out. Half a world away in Hong Kong, the nerve of countless phenomenon. Start in the near future, the more nervous fight win today. As for the drop in income and unemployment, reliable figures to wait now. I agree with the Bega, that 25 percent of the U.S. unemployment rate does not arise. This is because today, more knowledge and experience, the faster to save money. I said that if the government does not sell, because there are trade unions, welfare and minimum wage, etc. about what the market slump, the unemployment rate of 25 percent is possible. I also said that the government hand is not necessarily a good thing: the down trend can be slowed down to reduce short-term pain, and in return was long the pain. Bega also pointed out that I have mentioned 10 years ago, the Asian financial crisis South Korea, also rebounded quickly down quick. But South Korea cut the wages of more than gravel, and the Government did not save the market. I do not agree with the Bega Greenspan's view that the turmoil will calm down quickly. Wen put forward a number of Bega in the United States to save the complexity of the financial plight of the suggestion to see the master. However, I have expertise in system analysis, the United States face the difficult task of financial system problems, long-term point of view, the two San Zhao-saving help. Too complicated, I am sure, sloppy to say about it will not be any major mistakes. A country's economic system is a huge contract organizations. Organization of the United States contract with China's very different. Analysis of the current difficulties, we generally can be divided into two levels of the United States. The first is the analysis of the economics textbook level, the output is in that regard, including the business and industrial sectors and real estate. The second is less attention to the level of textbooks, is that the financial aspects, including the banking, securities brokerage firms, financial institutions and the Federal Reserve Board. Each floor has its own structure of the contract, and between the layers and layers are also linked to a variety of contract. Level of output depends on the financial aspects of trade financing and the demand for profit; output levels depend on the level of financial assistance in order to function properly. Closely related to a level of the accident, because the linkage of the contract, as a whole can be a serious matter. U.S. financial dimensions of the trouble is. Most people, even myself, to see that this happened only after the financial system, where the contract structure is so complex. The so-called derivatives by the spread of the U.S. financial structure of the contract, the complex was incredible! AIG's former president, MR Greenberg on October 7 in the House of Representatives for the speech, alas (see http://oversight.house.gov/documents/20081007101332.pdf). I very much appreciate the 80-year-old member, there is no reason to doubt his top-level expertise. For the elderly is an important part of the speech, the implication is: the U.S. financial markets is a sand, you can make money, but you have to know how easy way out, walking in the sand when you step-by-step, a seven customs, can not be There is also a wrong move half a step. From other reports I read to understand, this piece of sand are formed because of the mortgage loans without proper security. To explain to the people on the street, is to borrow money or property can be stock or currency or legal tender in cash as collateral, government bonds can also be used, but the tools derived from bonds or unreliable, because often only Junziyiyan down in the end. Personal, the United States is the plight of the whole financial structure of the contract collapsed down. Government-funded rescue, you can see for not doing the whole floor to collapse, fell to half of the support. Long-term point of view, what he had said the current financial crisis is to finance this level of good repair. How should we do? Let it collapse and then try to rebuild? Or have fallen to half of the support, here where the repair of some sort? This is the core issue ─ ─ is the repair or construction, or from where to build it? Bega choice appears to repair. I am indecisive. Nevertheless, I am a recycle King of Chess, this time can not recycle the next game I can not say. I dare say that these days many economists say the financial crisis is the failure of the free market, are nonsense. Although the twentieth century from the Temple of the two free market ─ ─ UCLA and the University of Chicago ─ ─ I do not believe that the market can do. I am the essence of the company put a stop, the main point is that the economy can not be a lack of a visible hand. I pointed out that no transaction costs will not have a market, the Government has also pointed out that the existence of a Pan-opened at the beginning of the earth humanity can not be so stupid for a long time. From the lower transaction costs or social terms, there is something the market more efficient and some government more efficient. How to choose between the two has long been a problem, then just Senmu's analysis of the supplies were noisy on a whole generation. If the introduction of the need to appease the interests of members, government officials need to call, the choice is even more difficult. Loan-to-trigger times out of the catastrophe, one can not be caused by the free market. U.S. financial markets a variety of control, the Federal Reserve interest rate on the reel off the reel, and the loan-to-time, Greenspan said it is safe. On the other hand, the so-called AAA rating by the government-approved agencies say. I do not believe that killing, no rating will make such a big disaster! Fluctuations in the market, the greedy speculators ─ ─ no doubt that there is harm, but to intervene, they also frequent. Government decided what to do, what not to do so has never been easy. The cost of the transaction or message has always been difficult to measure. I said, human beings can be selfish and bring prosperity, but also can increase transaction costs or social. Twentieth century, experience tells us that human selfishness derived from the system and conduct should be able to destroy mankind!