Message from @trapexit
Discord ID: 528695496055717900
WW2 is what ultimately recovered everyone from the Depression, in large measure because of the US
This is basic economics
Government got money from where?
Government takes wealth, it does not create wealth.
Bonds as far as i understand it
Trapexis, the New Deal under Roosevelt was not "make work". Grand Coulee Dam. TVA. Bridges. Lots of infrastructure still in use today.
The New Deal did create wealth. Was it the most efficient method, that can be debated. But it DID create wealth.
Making use of something doesn't mean it wasn't mal investment
It also helped that the US had basically been acting as an arms supplier for the allies and been getting cash in exchange
Unless you're a salmon, the Grand Coulee dam was damn fine investment.
This is econ 101. If the market isn't investing in it it's a mal investment.
TVA - fine investment.
And if the market is investing?
People would have otherwise spent their money in other ways.
Bridges - fine investment
There was no money to spend
Not if people would have wanted other things
The banks were in shambles
Of course there was.
The economy was frozen for lack of money
They weren't in shambles in Canada
There is no such thing as lack of money
Indirectly, because the gov't didn't regulate banks effectively
That shows a complete misunderstanding of what money is.
Specifically the crash forced people into a saving mentality
The regulation is what lead to the problem. The Fed.
People were trying to get their money from banks that had no money to return to their depositors.
The banks had invested in things that evaporated.
Poof, no money.
where they didnt want to spend because they were unsure about their situation as a whole
People didn't save because they didn;t trust banks
Money only "disappears" due to fractional reserve banking
The FDIC exists today, and has saved us from similar issue since, because of Roosevelt response to the Depression.
FDIC is a bad policy
Didnt really save us from the housing crash
It subsidizes bad bank behavior
It monopolizes risk
It prevents regular citizens from losing everything
Instead of individuals taking bank behavior into account like they did prior.