On Thu, 12 Feb 2009 12:59:42 -0600, Ignoramus13596
wrote:

On 2009-02-12, F George McDuffee wrote:
Somewhere there is a fundamental flaw in the economic model, and
more of the same only better, faster, cheaper, etc. is not the
cure.

The fundamental flaw is the highly leveraged banking model where
investments are made by means of lending, instead of taking equity.

I read somewhere, which I cannot prove with certainty, that over the
last several decades banking has not been profitable to the society,
once you factor in the costs of bailouts.

i
----------------
I have seen the same observation, and it seems plausible. Indeed,
based on not only the current bailouts, but the very considerable
losses that are sure to result from their operations
[mark-to-market CDOs], more than likely the banks, in aggregate,
have generated huge net real GDP losses, in addition to the royal
"screw job" they have given their stockholders. This is a shame,
because the contributions of the local and regional banks show
that this should be [and is, under proper leadership] a vital
wealth generating, not a wealth destroying sector.

Several other industries are also in capital sink category, civil
aviation being a prime example.

If it were possible to factor in all of the cost shifting, cost
externalization, and non-monitary factors such as "quality of
life," I am sure there would be a large number of industry
sectors the country would be better off not having.


Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).