Quote from: NewLiberty on September 04, 2014, 12:13:03 PM

Quote from: wasserman99 on September 04, 2014, 06:37:43 AM

Quote from: NewLiberty on September 03, 2014, 04:33:43 PM

Quote from: wasserman99 on August 29, 2014, 06:33:30 PM

It regulates how quickly the oversupply comes into the market. The exim bank is able to wait longer to sell the supply of a good so they can price the good appropriately. If a company is forced to sell their product to meet cash/liquidity needs then they would sell their goods at an unwarranted discount.

This sounds like a job for a company, not for a government entity.
Let Overstock do it. Or let them buy insurance.
If its not a viable business, then its not a viable business. Let the people do something productive instead.
Taxes ought not be taken by force of law from the widows and orphans to pay for the subsidy of business decision failures by protectionistas.
The markets price goods appropriately, not a government.

The guarantees that the ex-im bank provides are not free, it essentially acts as insurance. Many of the goods that are sold and guaranteed by the ex-im bank are not things that can be sold on overstock, and when they can be sold the quantity is much larger then what overstock is built for. For example if a foreign airline were to order 10 boeing airplanes and then file bankruptcy then boeing would be out of the cost to build the airplane but would have little to no way of selling it. The market for airplanes is not such that an airplane can be easily sold quickly.

Yes, Overstock customers are a different set of customer, but the point stands.
Boeing has the same way of selling their extra airplane as anyone else does. The ExIm is a crutch that enables bad business decision making and socializes risk while privatising profit.
I'm just not a fan of government insurance for a select few elite "too big too fail" constituencies.
It gives the moniker of "white collar welfare" that gets applied to aerospace and others too much credence.

If a customer were to approach boeing and order 10 airplanes, you think it would be a bad business decision to accept the order if the customer has bad credit? I would say it would be a bad decision to not accept the order.

Something else to keep in mind is the fact that the ex-im bank does not only protect against corporate defaults, they also protect against unexpected, new capital controls that foreign governments put on their economy. If the ex-im bank did not exist then Russia for example could wreck the US economy by having it's companies place large orders with US companies and then place capital controls making it impossible for the US companies to get paid.

One thing you should remember is the fact that every recession is always preceded by a glut in inventory and drop in demand.