Any fool can get us out of recession.

[Machjo]

Honestly, it's easy to get a country out of recession. I could have gotten it out of recession within a month at most just by legalizing counterfeiting of money. We'd have such a labour shortage within a month after that that the recession would be a fading memory. The problem though is getting us out of recession without throwing us into a bubble economy.

Any proposals here on ideas for doing just that, getting us out of recession into a stable economy, all the while avoiding a bubble economy?

Edited August 7, 2009 by Machjo

[Guest TrueMetis]

Legalize drugs.

[Machjo]

Legalize drugs.

How would that help get us out of recession while avoiding a future bubble economy. Sorry, but I just don't see the link.

[Guest TrueMetis]

How would that help get us out of recession while avoiding a future bubble economy. Sorry, but I just don't see the link.

More of an opinon thing but there is a large drug economy which if legalized might help.

[Machjo]

More of an opinon thing but there is a large drug economy which if legalized might help.

OK. I still don't see the economic impact.

[Jerry J. Fortin]

Are you really ready for this?

Eliminate income taxes, convert to transaction taxes, the percentage calculated to provide sufficient revenue streams to account for designed budgets. Currently that amounts to a little over 12%, those numbers are from a few years ago.

Eliminate fractional reserve banking. Require the central bank to loan to all chartered banks sufficient funds to cover deposits at interest.

These two things will eliminate deficits and debt within five years.

[Moonbox]

Eliminate income taxes, convert to transaction taxes, the percentage calculated to provide sufficient revenue streams to account for designed budgets. Currently that amounts to a little over 12%, those numbers are from a few years ago.

I would be on the other side of the Falls every single weekend to 'vacation' and buy my stuff there if this were the case. The smuggling that would go on would bog down our borders to the point that trade would grind to a halt.

Neat idea, no way to implement it.

[jbg]

Getting back to the topic, I agree that inflating your way out of a recession is easy and avoiding a hyperinflation is hard.

That being said, I think it is dangerous to allow a runaway deflation or meltdown of assets as we saw the beginnings of last fall.

[Jerry J. Fortin]

Okay folks, how do you"get out" of a recession? Keeping in mind you are walking along the lines of the government acting to end something it did not start. Isn't it about time we realize that the government is very limited in what it can do? As I have suggested, the government can control both its spending and its revenues, and to a certain extent through tax manipulation can also influence private sector developments.

The heart of the problem is still found in the financial end of things. Getting control of that should equate to job number one, and with that in mind I suggest eliminating fractional reserve banking in this country. Legislating the sector into mandatory utilization of the central bank, in order to do what it was supposed to do in the first place seems a logical way to begin the process.

[Machjo]

I can agree with scrapping fractional reserve banking.

I'd add to that that the government should ensure that any stimulous spending can be recovered at the end of the recession. An example of how such a ssytem could work would be:

1. Counter deflation exclusively via reduction of the bank rate as long as the bank rate is above 0%.

2. If, after having dropped the bank rate to 0%, deflation persists, then 'print' just enough money to counter the deflation, spending the extra money in the following areas, prioritizing according to need:

a. pay off the debt,

b. invest in training the unemployed in trades and professions, perhaps through job-training vouchers to be cahed in at vocational colleges,

c. Invest in global ethical funds.

The 'printing' of money would stimulate the economy during the recession, but would place the government in an ideal position to fight inflation and high interest rates come next recession, mainly in the following ways:

a. The low interest rate would give the Bank of Canada much wiggle room if and when it needs to increase them to counter inflation,

b. The lower debt at the end of the recession would allow the government to put less money into the economy in the form of debt repayments after the recession,

c. A better trained workforce would be more capable of producing work of higher value, thus allowing it to sustain the higher tax rate, government spending cuts, or both, to take money back out of the economy at the end fo the recession, and

d. Government-owned investments could be sold, the money gained to be taken out of the economy.

Such a strategy would allow the government to put money into the economy during the recession while simultaneously placing itself in an ideal position to come out of the recession with sufficient control over the economy so as to thwart any threat of a coming bubble economy.