Free Capitalist Network - Community Archive
Mises Community Archive
An online community for fans of Austrian economics and libertarianism, featuring forums, user blogs, and more.

Obama has presided over the biggest expansion of...Corporate Profit?

rated by 0 users
Answered (Not Verified) This post has 0 verified answers | 8 Replies | 3 Followers

Top 500 Contributor
Male
305 Posts
Points 7,165
Willy Truth posted on Thu, Nov 1 2012 2:10 PM

Anyone care to refute why Obama's economic policy isn't the best for corporate America's profits in history according to "statistics"?

http://www.fool.com/investing/general/2012/10/24/the-best-presidents-for-the-economy.aspx

 

This was lifting from an article about why Romney and Obama are the same candidate---for austerity and neoliberal policies.

http://socialistworker.org/2012/11/01/the-next-president-of-austerity

  • | Post Points: 35

All Replies

Not Ranked
Male
87 Posts
Points 1,215

If a writer has no background in Austrian economics and just looks at history through statistics, they can be forgiven for that erroneous assumption. (The assumption that Obama created or influenced  somehow this profit and therefore it was good for the country) That is what Keynesian politicians and reporters and economists want them to do.

The article says that under Obama the stock market went up, corporate profits went up GDP went up etc. and that presidents don't have much control over the economy.

Austrians know that presidents cannot improve the economy permanently but that they can give Keynesian stimulus to create a "boom" while they are in power. All the above measurements are not a true reflection of the "economy" but just the result of the biggest credit expansion in history. We also know every time after that there is going to be a bust, later.

 

  • | Post Points: 20
Top 10 Contributor
Male
4,987 Posts
Points 89,745

Sure, credit has risen like nothing else, but it's locked up in excess reserves.

  • | Post Points: 35
Top 500 Contributor
Male
305 Posts
Points 7,165

What do you mean by excess reserves exactly?

  • | Post Points: 20
Top 200 Contributor
Male
508 Posts
Points 8,570
Suggested by FascistSoup

Nominal corporate profits can skyrocket all they want, but the fact that wealth is locked up in an increasingly elite setting, while the standards of living of everyone else stagnate or decline should be enough to condemn his whole policy.

  • | Post Points: 5
Top 75 Contributor
1,612 Posts
Points 29,515

What do you mean by excess reserves exactly?
[

You'd think at some point people who need to ask questions like this would just use the website or Google...

"Excess reserves" is a  term banks use to say "available credit."  I don't think Wheylous used it correctly.

Reserves = total deposits (kept on hand for withdrawal)

Excess Reserves = money available for lending

"The Fed does not make predictions. It makes forecasts..." - Mustang19
  • | Post Points: 35
Not Ranked
Male
87 Posts
Points 1,215

Whoa there Aristophanes.... seesh such temper

If everybody knew everything there would be no need for this forum,. we would just all agree.

Besides his question was not what are "excess reserves" but he was asking what Wheylous meant. On these forums, that these "corporate profits" have not been reinvested to grow the economy because investors are holding it in reserve for whatever reason- maybe regime uncertainty. I agree with that but that does not change the argument.

Obama HAS presided over a huge expansion of profit regardless of where the corporations wish to park their money. The question is, if Obama was allowed to continue along that track, will it continue towards additional corporate profits and therefore betterment of the country?

We all agree (I think) it won't - regardless of which part of that profit is "excess reserves"

  • | Post Points: 5
Top 500 Contributor
Male
305 Posts
Points 7,165

Lol there's nothing more futile or self-deprecating than attempting to shame someone over the internet.

Thanks for the clarity though, although I'd still like to hear what Wheylous meant by it since there is dispute over the term.

 

Also, I fail to see how any of Obama's policies have allowed for more corporate profit, unless it's just a product of his presidency commencing at one of the slowest times in US history.

  • | Post Points: 5
Top 50 Contributor
Male
1,687 Posts
Points 22,990

Sure, all of that loot has to go somewhere.  The biggest banks get free money to speculate, the biggest unions get more protection from foreign competitors, the big companies get lots of intellectual property laws, the big pharma and insurance hit paydirt with Obamacare.

But guess where it came from, all those poor saps on unemployment.

But don't worry, Romney will be equally as bad or worse when/if he becomes president.

  • | Post Points: 5
Page 1 of 1 (9 items) | RSS