Unlike the USSR, the US doesn't have state owned enterprises making up the majority of it's GDP. The companies that give a shit win markets.
Hum... Are you sure? Keep in mind that state backed companies that are not allowed to fail create almost exactly the same problem.
You also forgot the national auto industry that was bailed out from certain disaster in 2008.
You have obviously lived in cities your entire life.
Farms fail all the time. Ask any banker at a branch in an agricultural area.
Every industry is too big to fail.
Honestly, other than entertainment, I can't think of any situation where the government would allow an entire industry to fail.
I'm appalled anybody needs to ask this question after the 2008 bailouts.
> In total, U.S. government economic bailouts related to the global financial crisis had federal outflows (expenditures, loans, and investments) of $633.6 billion and inflows (funds returned to the Treasury as interest, dividends, fees, or stock warrant repurchases) of $754.8 billion, for a net profit of $121 billion.[89]
https://en.m.wikipedia.org/wiki/Troubled_Asset_Relief_Progra...
And the outflows include about 30% that went to Fannie and Freddie, which were quasi govt operations, and 10% to auto makers that the govt created no mechanism to recover money from.
In reality, outside of the original Bear Sterns collapse, what the 2008 financial sector basically saw was a loss of confidence which was leading to a bank run. All the govt did was provided a backstop that prevented the bank run, which is why even though the government took ludicrously low ownership stakes for the money they put in, their stakes were still highly profitable.
Another example showing this, but from the private sector, was Warren Buffett getting Goldman Sachs to basically pay him hundreds of millions of dollars just to lend his credibility, which was sufficient for them to weather the environment (this was structured as a loan, but the loan was just window dressing for the fact that Buffett was saying he had trust in GS).
In reality, there was always gonna be a recession as house prices went back to more realistic levels and the wrongly rated AAA mortgage backed securities were marked to market to a much more realistic number, along with the knock on effects on various portfolios that included them.
What tipped this recession into a major financial crisis was Paulson forcing Lehman brothers to collapse despite bids from at least 2 other companies that would have saved Lehman, simply because of a personal vendetta.
The overnight and unexpected Lehman bankruptcy sowed massive uncertainty into the markets, drove a bank run, and triggered a chain reaction of failed assets that eventually made it to AIG, and the risk of an AIG failure, was what eventually caused the crisis.
Much of it could have been avoided simply if Paulson wasn’t such an asshole.
I would find it absolutely hilarious if Apple banning certain kinds of in-app tracking combined with Binance sparking a run on FTX for laughs ended up collapsing the software and crypto industries for a few years.
> harder work does not necessarily pay better or lead to advancement
Smarter work does, though.
In a free market, supply&demand set employee compensation at about 85% of the value the employee produces.
The reason is simple. If the company overpays, the company goes bust. If the company underpays, his competitor will hire the person away.
If you believe you're underpaid, make your case to your employer. If he agrees, good for you. If he doesn't, and you're not convinced, quit and work for his competitor.
The thing to do then is keep founding competitors and make a profit selling them to the "monopoly".
P.S. buying a company is not "sabotaging" it. LOL
So who even gives a crap if you win this rigged game?
A curious perspective; fear of options. Emotion over logic.
A free market would be something like a farmers market where producers sell directly to consumers. Instead, the US stock market is more like a cartel where there is a central group of intermediaries, which control money moves between producers (companies) and buyers (small/medium investors).
No, a free market is when people are free to make transactions with whoever they please. Big companies are just as free market as mom & pops.
Not really. A company that's big enough to be (even a regional) monopoly forces people to transact with them by virtue of being the only game in town. The question is whether this is a continuous gradient from "more free" to "less free" or more similar to a step function when a company reaches monopoly status.
Your local supermarket may be the only one in your village, but the next village is easily attainable. Something being more convenient doesn't make it a monopoly.
I grew up in the Air Force. My mom would always shop at the base PX because it was cheaper, and sometimes it was a 30 minute drive away, passing store after store to get there. To make the drive worthwhile, she'd buy 2 weeks worth of groceries at a time.
In Seattle, there are some neighborhoods without stores, but that is usually because the stores cannot handle the shoplifting anymore, and quit. It's still not far to another store outside those neighborhoods.
You can even buy food from Amazon from your Lazy-Boy. Push a button, and food appears on your porch.
If you have a really hard time finding food where you live, may I suggest:
Happy new year to you!
P.S. I buy some food items from Amazon that, including shipping, are cheaper than what the local grocery store prices them at. Isn't American competition great?
Aren't you? I find that businesses like my money.
What stocks in the market are you prevented from buying?
https://www.sec.gov/education/capitalraising/building-blocks...
Stock price is a part of a public companies responsibilities, but there are many other priorities and responsibilities a company's charter and board can set. Personally I only want to have stock in companies with a vision. Ultimately they tend to become the most valuable in terms of stock price too.
https://wikipedia.org/wiki/List_of_countries_by_government_s...
Also- based on my cursory reading here, it seems disingenuous to claim 46% of GDP is government spending- the stat is that government spending is comparable to 46% of the GDP of that year. Government spend doesn’t comprise 46% of the GDP, rather we are using GDP as a measuring stick to evaluate the sanity of government spending amounts.
Defense spending. Government workers. Infrastructure projects various governments partially or fully pay for. Subsidies. And so on.
However, I’m struggling to square that fact with the observation that the Wikipedia table shows a number of entries >100%. How could government spending ever exceed 100% of GDP given it is counting toward GDP?