French President Nicolas Sarkozy said the following at the World Economic Forum at Davos today...
"We are not asking ourselves what we will replace capitalism with, but what kind of capitalism we want?" he said.
"We must re-engineer capitalism to restore its moral dimension, its conscience,"
Ok, he's got the right idea here. Just because we hit an economic downturn does not mean we should start pushing towards socialist policies. In fact, moving away from such policies seems to be working in other places.
Now, what we need is not more regulation, but "good" regulation. We need current regulation to be simplified, clear, and transparent. The more you convolute something like this, the more loopholes you create for those who don't want to play by the rules to worm their way around the regulations in place. Both of our political parties seem to back regulation that apparently is too clouded in legalities that loopholes seem to be at every turn. Make it simple, make it clear, and make it so there is no doubt about what you are trying to accomplish.
This also naturally reduces and limits the amount of regulation you can implement, which is conducive to a well-oiled capitalist economy. You can only go so far without arousing protest from investors, businesses, banks, and the public at large (who probably does not understand a lot of the regulation to begin with, I know I have problems understanding some of the regulations I've looked up).
Granted, I would prefer minimalizing regulation, but since I have to play within the system (let's face it, most good revolutions do not happen overnight...unless you're talking Eastern Europe in 1989, but I digress), let's start by simplifying regulation first, then we can talk about what (if any) regulations are really necessary.
Also, taxing banks and big business as punishment will not be conducive to anything positive for the economy. If you thought big banks weren't lending before, watch what happens when you start penalizing them. If other states starting pulling moves like the state of Oregon just decided to do, you're going to see the leaders and drivers of free enterprise and industry start "going Galt" in huge numbers.
Showing posts with label economy. Show all posts
Showing posts with label economy. Show all posts
Thursday, January 28, 2010
Thursday, December 10, 2009
Count Me In...
To think, I was never a big fan of ol' Dubya, but I'd be one of the 44% that would prefer him to Obama right now.
Tuesday, October 28, 2008
A Breakdown of Obama's Lies on Taxes
Done by a small business owner at the ARFCOM forums.
A brief synopsis...
Obama Tax Lie #1 - By letting the Bush tax cuts expire, this is a de facto tax increase for 100% of Americans, because 100% of Americans received a tax cut under George W. Bush.
Obama Tax Lie #2 - Obama plans to lift the inflation-adjusted cap on the Social Security tax in a manner that will impact anyone making up to $249,999.99 a year.
Obama Tax Lie #3 - Obama wants to increase the capital gains tax from 15% to 20%. He claims it is to get those "Wall Street fat cats", which is about 1% of the population...however, 50% of the population invests in the stock market. So for 50% of the population, this is a tax increase.
Obama Tax Lie #4 - Obama wants to increase taxes on big corporations. However, as this gentleman points out, corporations do not "pay taxes"...they simply collect the money from the customers and give it to the government. When Obama raises their taxes, the corporations will simply increase the price of what you're buying from them, which will cost you money.
The poster also has a tax table comparing your current tax liability as opposed to what it will be in 2010 with Obama letting the Bush tax cuts expire.
A brief synopsis...
Obama Tax Lie #1 - By letting the Bush tax cuts expire, this is a de facto tax increase for 100% of Americans, because 100% of Americans received a tax cut under George W. Bush.
Obama Tax Lie #2 - Obama plans to lift the inflation-adjusted cap on the Social Security tax in a manner that will impact anyone making up to $249,999.99 a year.
Obama Tax Lie #3 - Obama wants to increase the capital gains tax from 15% to 20%. He claims it is to get those "Wall Street fat cats", which is about 1% of the population...however, 50% of the population invests in the stock market. So for 50% of the population, this is a tax increase.
Obama Tax Lie #4 - Obama wants to increase taxes on big corporations. However, as this gentleman points out, corporations do not "pay taxes"...they simply collect the money from the customers and give it to the government. When Obama raises their taxes, the corporations will simply increase the price of what you're buying from them, which will cost you money.
The poster also has a tax table comparing your current tax liability as opposed to what it will be in 2010 with Obama letting the Bush tax cuts expire.
Compassion Is Not Socialism...
...but the forcible redistribution of someone else's wealth that they have earned, and the punishment of self-made success, IS socialism.
Period, end of story, it's part of the definition of socialism. C'mon lefties, let's call things for what they are.
Period, end of story, it's part of the definition of socialism. C'mon lefties, let's call things for what they are.
Tuesday, October 21, 2008
A Democrat Rips Media, Dems for Blaming GOP for Housing Crisis
Orson Scott Card lays the truth out there about how the Democrats should be receiving the lion's share of the blame for the current economic crisis, and how the media is pretty much ignoring that fact.
Mind you, Orson Scott Card is a Democrat.
Mind you, Orson Scott Card is a Democrat.
Wealth Redistribution: Proof Americans Don't Want It
From a Gallup Poll in June...
That's a truly non-partisan agreement, in my opinion. That's why WHAT Obama said to Joe the Plumber is much more important than WHO Joe the Plumber is.
(h/t The Campaign Spot)
When given a choice about how government should address the numerous
economic difficulties facing today's consumer, Americans overwhelmingly — by 84%
to 13% — prefer that the government focus on improving overall economic
conditions and the jobs situation in the United States as opposed to taking
steps to distribute wealth more evenly among Americans.
Americans' lack of support for redistributing wealth to fix the economy
spans political parties: Republicans (by 90% to 9%) prefer that the government
focus on improving the economy, as do independents (by 85% to 13%) and Democrats (by 77% to 19%).
That's a truly non-partisan agreement, in my opinion. That's why WHAT Obama said to Joe the Plumber is much more important than WHO Joe the Plumber is.
(h/t The Campaign Spot)
Saturday, October 18, 2008
Buffett Promotes Pro-Capitalist Thinking...
Some simple tenets and proof to back them up.
"Buy American stocks"
"Be fearful when others are greedy, be greedy when others are fearful".
While Buffett backs Democrats, he is a definite capitalist and if he takes over the Federal Reserve, we may not have to worry too much on that end...should he continue promoting this kind of sensible advice.
"Buy American stocks"
"Be fearful when others are greedy, be greedy when others are fearful".
While Buffett backs Democrats, he is a definite capitalist and if he takes over the Federal Reserve, we may not have to worry too much on that end...should he continue promoting this kind of sensible advice.
Thursday, October 16, 2008
I Was Asked an Interesting Question Yesterday...
A good friend of mine at work, who is an as-yet undecided voter who doesn't like Obama or McCain, and would like to see the option of "undecided" on the ballot, asked me one heck of a question yesterday, and it came out of nowhere and caught me off-guard.
He asked "you could go back in time and change one American political event or decision, what would it be?"
He brought up things like Robert Kennedy's assassination, the bombing of Hiroshima and Nagasaki, and a few other events that you generally learn about in History class as examples. I also mulled over a few choices that I considered, such as...
- Telling Nixon's cronies not to break into the Watergate Hotel.
- Not allowing a handful of Mississippi delegates to abandon Reagan for Ford at the 1976 GOP Convention.
- Made the Presidential term limit part of the original 10 Amendments of the Bill of Rights.
However, we changed the subject, and after 10 minutes, I hit him with my real answer.
- I would have stopped America from jumping off the Gold Standard.
This answer blew him away, as I don't think he expected me to go that route, and he had to agree that this was a significant point. As he said, "we would definitely have a strong dollar and a solid, stable economy."
What do you think? What singular event would you change...if you could?
He asked "you could go back in time and change one American political event or decision, what would it be?"
He brought up things like Robert Kennedy's assassination, the bombing of Hiroshima and Nagasaki, and a few other events that you generally learn about in History class as examples. I also mulled over a few choices that I considered, such as...
- Telling Nixon's cronies not to break into the Watergate Hotel.
- Not allowing a handful of Mississippi delegates to abandon Reagan for Ford at the 1976 GOP Convention.
- Made the Presidential term limit part of the original 10 Amendments of the Bill of Rights.
However, we changed the subject, and after 10 minutes, I hit him with my real answer.
- I would have stopped America from jumping off the Gold Standard.
This answer blew him away, as I don't think he expected me to go that route, and he had to agree that this was a significant point. As he said, "we would definitely have a strong dollar and a solid, stable economy."
What do you think? What singular event would you change...if you could?
Wednesday, October 15, 2008
Why Are People Acting Like We've Never Been in a Recession Before???
The stock market experts, the TV talking heads, the bloggers...they all like to run around like headless chickens in panic over how we cannot stand a recession, and that the world is somehow going to end within the next few months.
The last thing we need is panic. We will get through this.
Since the end of the Great Depression, we've had 6 major recessions, a little history for you...
The recession of 1953-54
- Caused by a post-Korean War inflationary period, where the Federal Reserve put more restrictive fiscal policies to curb inflation growth. However, consumer demand dropped due to the expectation of a recession, so the recession occurred anyway...just on the side of consumer demand. This lasted from 2nd quarter of '53 to the 1st quarter of '54.
The recession of 1957-58
- You'd think that the 1950's would be remember for recessions, and not the boom period we all believe. This goes to show you that there are hiccups and bumps on the road to prosperity. This was caused by the loosening of monetary policy in late '57. Along with this came a decline in the investment of fixed capital both in Europe and in the United States. In America, auto sales declined sharply, and unemployment rose. What stemmed the recession from further harming the economy was the lack of change in personal income amongst employed Americans, which gave monetary stability to those who had jobs.
Most notably, this was a worldwide recession...and it led to Democratic Party gains in Congress in the 1958 elections.
The recession of 1973-74
- Caused by the OPEC oil price increase and huge US Government spending (a combination of the Great Society programs, as well as the Vietnam War...Nixon inherited a looming mess from LBJ), leading to stagflation, and probably a good mirror of what we should expect to see as the current economic problems play themselves out.
When the U.S. was faced with an oil embargo placed up on it by OPEC in 1973, due to it's support of Israel in the Yom Kippur War, the government placed price controls...which led to gas rationing.
During this same time, the Bretton Woods System fell apart (due to the dollar being very strong against other currencies because of the increase in Gold prices), and the unilateral devaluation of the dollar (the Smithsonian Agreement) caused the Dow Jones Industrial Average to drop 45% from early 1973 to late 1974. Also, inflation increased from 3.4% in 1972 to over 25% by 1975. The United States did not see the Stock Market return to a comparable level (in real terms, adjusted for economic growth) until 1993.
The London Stock Exchange dropped 73% during this same timeframe. Interestingly, the London Stock crash is also attributed to a housing crisis...which was followed by a boom period of over 150% from late 1974 to early 1975, a sign of things to eventually come?
The recession of 1980-82
- Caused by the 1979 Energy Crisis that came with the overthrow of the Shah of Iran by Muslim fundamentalists led by Ayatollah Khomeini. Exacerbated by rampant stagflation of the American economy under Jimmy Carter. The recession was more severe than it should have been because it was unexpected. Also, the impact was intensified by the Fed Chairman Paul Volcker keeping interest rates very high to force inflation out of the economy, which did eventually work and lead to series of boom periods economically in the United States.
The recession of 1990-91
- Caused by a decrease in industrial production, the short-lived oil price spike of 1990 due to the Iraqi invasion of Kuwait, and made worse when the Bush 41 reneged on his "No New Taxes" pledge.
The recession of 2001-03
- Caused by a recession that began in the European Union, felt in parts at the end of Clinton's term and the beginning of Bush 43's, and exacerbated by 9/11, the Enron/WorldCom accounting scandals, and the dot-com bubble burst. However, from late September, 2001 to early 2003, the market crashed twice, with a recovery period in mid 2002 that helped average out the crashes a bit.
Right now, we're not in a recession, but we're heading for one. It has been seen in the past that higher taxation (on anyone, not just individuals) and looser monetary policies (like what the Democrats have advocated) tend to worsen these conditions.
Just some food for thought.
The last thing we need is panic. We will get through this.
Since the end of the Great Depression, we've had 6 major recessions, a little history for you...
The recession of 1953-54
- Caused by a post-Korean War inflationary period, where the Federal Reserve put more restrictive fiscal policies to curb inflation growth. However, consumer demand dropped due to the expectation of a recession, so the recession occurred anyway...just on the side of consumer demand. This lasted from 2nd quarter of '53 to the 1st quarter of '54.
The recession of 1957-58
- You'd think that the 1950's would be remember for recessions, and not the boom period we all believe. This goes to show you that there are hiccups and bumps on the road to prosperity. This was caused by the loosening of monetary policy in late '57. Along with this came a decline in the investment of fixed capital both in Europe and in the United States. In America, auto sales declined sharply, and unemployment rose. What stemmed the recession from further harming the economy was the lack of change in personal income amongst employed Americans, which gave monetary stability to those who had jobs.
Most notably, this was a worldwide recession...and it led to Democratic Party gains in Congress in the 1958 elections.
The recession of 1973-74
- Caused by the OPEC oil price increase and huge US Government spending (a combination of the Great Society programs, as well as the Vietnam War...Nixon inherited a looming mess from LBJ), leading to stagflation, and probably a good mirror of what we should expect to see as the current economic problems play themselves out.
When the U.S. was faced with an oil embargo placed up on it by OPEC in 1973, due to it's support of Israel in the Yom Kippur War, the government placed price controls...which led to gas rationing.
During this same time, the Bretton Woods System fell apart (due to the dollar being very strong against other currencies because of the increase in Gold prices), and the unilateral devaluation of the dollar (the Smithsonian Agreement) caused the Dow Jones Industrial Average to drop 45% from early 1973 to late 1974. Also, inflation increased from 3.4% in 1972 to over 25% by 1975. The United States did not see the Stock Market return to a comparable level (in real terms, adjusted for economic growth) until 1993.
The London Stock Exchange dropped 73% during this same timeframe. Interestingly, the London Stock crash is also attributed to a housing crisis...which was followed by a boom period of over 150% from late 1974 to early 1975, a sign of things to eventually come?
The recession of 1980-82
- Caused by the 1979 Energy Crisis that came with the overthrow of the Shah of Iran by Muslim fundamentalists led by Ayatollah Khomeini. Exacerbated by rampant stagflation of the American economy under Jimmy Carter. The recession was more severe than it should have been because it was unexpected. Also, the impact was intensified by the Fed Chairman Paul Volcker keeping interest rates very high to force inflation out of the economy, which did eventually work and lead to series of boom periods economically in the United States.
The recession of 1990-91
- Caused by a decrease in industrial production, the short-lived oil price spike of 1990 due to the Iraqi invasion of Kuwait, and made worse when the Bush 41 reneged on his "No New Taxes" pledge.
The recession of 2001-03
- Caused by a recession that began in the European Union, felt in parts at the end of Clinton's term and the beginning of Bush 43's, and exacerbated by 9/11, the Enron/WorldCom accounting scandals, and the dot-com bubble burst. However, from late September, 2001 to early 2003, the market crashed twice, with a recovery period in mid 2002 that helped average out the crashes a bit.
Right now, we're not in a recession, but we're heading for one. It has been seen in the past that higher taxation (on anyone, not just individuals) and looser monetary policies (like what the Democrats have advocated) tend to worsen these conditions.
Just some food for thought.
Tuesday, April 15, 2008
The Vicious Cycle of Environmentalist Policy
I swear to God, the enviro-activist left has really got us playing "Spin The Wheel, Make the Deal". I'll bullet point this to make it really simple.
- Environmentalist lobby pushes for increased production and research into Ethanol.
- Demand for corn goes up, pushes prices skyward.
- Farmers see the gold mine in corn crops, many switch to corn from wheat. This causes the United States to import wheat to meet it's own needs for the first time since the late 18th Century. Thus, the price of anything wheat-based (everything from bread to beer) goes up.
- Increase in corn price increases price of Ethanol itself, along with feed for cows.
- Ethanol-infused gasoline goes up in price due to increase in Ethanol price...price of beef goes up because farmers must pay more to feed their cows.
- Increased gasoline prices force increased shipping costs, which increase the price of ALL shipped goods.
- Shortage of American wheat production causes us to lose favor with all of the 3rd World Nations we would normally export wheat to.
- Democrats state that we are not a good member of the world community because we're not helping to feed the 3rd World...even though the shortage of American food exports is their fault.
Now, let's say this continues, and either Clinton or Obama is elected President. Here's what happens next...
- Media reports about starving children in Africa, state that it is the fault of "greedy rich people".
- Liberal Americans feel guilty, want the Government to "do something".
- Democrats state they will fix this (and everything else) by raising taxes on the "rich"...even though "rich" to them (according to the circulating Dem tax plan post-Bush Administration) is now any single person making over $33,000/year, or any married couple making a combined $45,000/year.
- More Americans in need of financial assistance for various reasons due to increased prices in goods and increased taxes....so the Democrats spend more money to relieve these troubled Americans. To cover costs, they raise taxes even more.
- Increased costs of production, shipping, and taxation force many companies to take jobs elsewhere, forcing millions of Americans into unemployment...thus repeating the previous bullet point.
- Rinse and repeat.
Scary, isn't it?
- Environmentalist lobby pushes for increased production and research into Ethanol.
- Demand for corn goes up, pushes prices skyward.
- Farmers see the gold mine in corn crops, many switch to corn from wheat. This causes the United States to import wheat to meet it's own needs for the first time since the late 18th Century. Thus, the price of anything wheat-based (everything from bread to beer) goes up.
- Increase in corn price increases price of Ethanol itself, along with feed for cows.
- Ethanol-infused gasoline goes up in price due to increase in Ethanol price...price of beef goes up because farmers must pay more to feed their cows.
- Increased gasoline prices force increased shipping costs, which increase the price of ALL shipped goods.
- Shortage of American wheat production causes us to lose favor with all of the 3rd World Nations we would normally export wheat to.
- Democrats state that we are not a good member of the world community because we're not helping to feed the 3rd World...even though the shortage of American food exports is their fault.
Now, let's say this continues, and either Clinton or Obama is elected President. Here's what happens next...
- Media reports about starving children in Africa, state that it is the fault of "greedy rich people".
- Liberal Americans feel guilty, want the Government to "do something".
- Democrats state they will fix this (and everything else) by raising taxes on the "rich"...even though "rich" to them (according to the circulating Dem tax plan post-Bush Administration) is now any single person making over $33,000/year, or any married couple making a combined $45,000/year.
- More Americans in need of financial assistance for various reasons due to increased prices in goods and increased taxes....so the Democrats spend more money to relieve these troubled Americans. To cover costs, they raise taxes even more.
- Increased costs of production, shipping, and taxation force many companies to take jobs elsewhere, forcing millions of Americans into unemployment...thus repeating the previous bullet point.
- Rinse and repeat.
Scary, isn't it?
Thursday, January 24, 2008
Tax Rebate Plan Reaches Tentative Agreement
Looks like a decent way to stimulate the economy without too much governmental "heavy-handedness".
Should the plan go through as it is rumored to stand...
- Tax rebate of $300 to individuals ($600 for married couples), and an additional $300 per child with a cap of $1,200 per family.
- Workers who made more than $3,000 in 2007 are eligible for the rebate.
- Income cap for eligibility is $75,000 for individuals, $150,000 for married couples.
The Democrats were flexible on not extending unemployment benefits for those reaching the 26 week limit and not increasing food stamps, while Republicans were flexible on the minimum income level of eligibility to the point of almost any person earning a paycheck will receive a tax rebate (the original income minimum was much higher in the original Bush proposal). Should the proposal be passed and signed by President Bush, tax rebate checks should arrive in most American mailboxes sometime in June.
Basically, everyone from the working class up to the upper-middle class will benefit from this.
Also part of the Economic Stimulus proposal...
- Fannie Mae and Freddie Mac will be able to buy homes over the current limit of $417,000.
- Tax cuts for businesses, small and large.
For the first time in a while, we're seeing government working together to provide a sensible solution to a major problem...which is "how to stimulate an uncertain economy." I'm glad to see that the Dems went the sensible route, hopefully this sensibility becomes a trend.
Should the plan go through as it is rumored to stand...
- Tax rebate of $300 to individuals ($600 for married couples), and an additional $300 per child with a cap of $1,200 per family.
- Workers who made more than $3,000 in 2007 are eligible for the rebate.
- Income cap for eligibility is $75,000 for individuals, $150,000 for married couples.
The Democrats were flexible on not extending unemployment benefits for those reaching the 26 week limit and not increasing food stamps, while Republicans were flexible on the minimum income level of eligibility to the point of almost any person earning a paycheck will receive a tax rebate (the original income minimum was much higher in the original Bush proposal). Should the proposal be passed and signed by President Bush, tax rebate checks should arrive in most American mailboxes sometime in June.
Basically, everyone from the working class up to the upper-middle class will benefit from this.
Also part of the Economic Stimulus proposal...
- Fannie Mae and Freddie Mac will be able to buy homes over the current limit of $417,000.
- Tax cuts for businesses, small and large.
For the first time in a while, we're seeing government working together to provide a sensible solution to a major problem...which is "how to stimulate an uncertain economy." I'm glad to see that the Dems went the sensible route, hopefully this sensibility becomes a trend.
Friday, January 18, 2008
Fortune Magazine Calls Hillary's Housing Propsal "Dumb"
Jon Birger rips into Hillary Clinton's proposal to fix the mortgage problem in the nation.
Hillary Clinton is no dummy. Even her detractors know that. And yet in last night's Democratic presidential debate in Nevada, Clinton floated what is perhaps the dumbest solution to the current mortgage mess I've heard from a top presidential contender.
And why...?
Where Clinton goes awry is her proposal to freeze mortgage rates for five years, which is essentially a much broader version of a deal President Bush recently hammered out with lenders to assist some subprime borrowers. If Clinton's only goal were to bail out homeowners facing steep rate resets on adjustable mortgages, her plan would work just fine.
For everyone else though, such a freeze would be disastrous. Interest rates on new mortgages would skyrocket - perhaps past 8 percent, as the mutual funds, pension funds and other investors who typically provide capital to the mortgage market shift their money into other investments where the government isn't impairing returns. With higher mortgage rates eroding buying power, the downward pressure on home prices would only increase. Lower home prices would lead to even more defaults, as more folks who'd lost the equity in their homes choose to walk away from their mortgages.
Ouch. So Hillary's plan would hurt investments of various kinds, including my 401k. Birger continues, comparing the other Democratic frontrunner's plan.
Barack Obama, meanwhile, wants to require better disclosure by lenders (of low teaser rates, for example) and, like Clinton and Edwards, proposes a government fund to help borrowers transition from unaffordable adjustable mortgages to lower-rate fixed ones.
That's smart and at least sensible. What is interesting is that not even liberal economists find Clinton's idea as sensible policy.
However, when I discussed Clinton's plan with a more sympathetic economist - one who'd worked for Bill Clinton - his reaction was much like mine and Duncan's. "This is an ugly correction, but it's a necessary one," says Jared Bernstein, senior economist with the liberal-leaning Economic Policy Institute. "This kind of an idea is a little bit of untying your shoes with a buzz-saw."
Hillary Clinton...no need for on the job training in the White House, because plans like this will definitely keep her out of it.
Hillary Clinton is no dummy. Even her detractors know that. And yet in last night's Democratic presidential debate in Nevada, Clinton floated what is perhaps the dumbest solution to the current mortgage mess I've heard from a top presidential contender.
And why...?
Where Clinton goes awry is her proposal to freeze mortgage rates for five years, which is essentially a much broader version of a deal President Bush recently hammered out with lenders to assist some subprime borrowers. If Clinton's only goal were to bail out homeowners facing steep rate resets on adjustable mortgages, her plan would work just fine.
For everyone else though, such a freeze would be disastrous. Interest rates on new mortgages would skyrocket - perhaps past 8 percent, as the mutual funds, pension funds and other investors who typically provide capital to the mortgage market shift their money into other investments where the government isn't impairing returns. With higher mortgage rates eroding buying power, the downward pressure on home prices would only increase. Lower home prices would lead to even more defaults, as more folks who'd lost the equity in their homes choose to walk away from their mortgages.
Ouch. So Hillary's plan would hurt investments of various kinds, including my 401k. Birger continues, comparing the other Democratic frontrunner's plan.
Barack Obama, meanwhile, wants to require better disclosure by lenders (of low teaser rates, for example) and, like Clinton and Edwards, proposes a government fund to help borrowers transition from unaffordable adjustable mortgages to lower-rate fixed ones.
That's smart and at least sensible. What is interesting is that not even liberal economists find Clinton's idea as sensible policy.
However, when I discussed Clinton's plan with a more sympathetic economist - one who'd worked for Bill Clinton - his reaction was much like mine and Duncan's. "This is an ugly correction, but it's a necessary one," says Jared Bernstein, senior economist with the liberal-leaning Economic Policy Institute. "This kind of an idea is a little bit of untying your shoes with a buzz-saw."
Hillary Clinton...no need for on the job training in the White House, because plans like this will definitely keep her out of it.
Monday, January 14, 2008
More on BoA's Acquisition of Countrywide
The stock market's slump over the past few months has largely hinged on fears of a recession, buoyed by the subprime mortgage crisis and the housing slump. Bank of America recently announced it's plans to acquire the biggest symbol of the housing/mortgage debacle, Countrywide Financial.
The question is...will this be the "saving moment" of the housing slump? There have been small signs of encouragement lately, including some reports of increased building of new homes. Also, BoA's purchase of Countrywide actually prevents the FDIC from ordering a bailout of the troubled company. With Bank of America's large pockets saving Countrywide Financial, could we see a more stable mortgage industry?
Maybe so. These little signs here and there, plus a big acquisition such as this one, may mean that the worst could be over for the housing market downturn. Cautious optimism would be the best way to go when looking at this situation.
The question is...will this be the "saving moment" of the housing slump? There have been small signs of encouragement lately, including some reports of increased building of new homes. Also, BoA's purchase of Countrywide actually prevents the FDIC from ordering a bailout of the troubled company. With Bank of America's large pockets saving Countrywide Financial, could we see a more stable mortgage industry?
Maybe so. These little signs here and there, plus a big acquisition such as this one, may mean that the worst could be over for the housing market downturn. Cautious optimism would be the best way to go when looking at this situation.
Friday, January 11, 2008
Financial News: Bank of America Purchases Countrywide Financial
Countrywide Financial, the new symbol of the housing market downturn and subprime mortgage crisis, will be purchased by Bank of America for a fairly modest $4 billion. The purchase will be complete by the 3rd Quarter of this year, and is expected to provide a boost Bank of America's stock in 2009.
Interesting, because Bank of America has some rather large coffers, which may save Countrywide from filing bankruptcy.
In other stock market news, in case you haven't kept up, today is another one of those "market correction" days, as the Dow is down over 285 points as I type this. I'm going to hate looking at my 401K tomorrow...
Interesting, because Bank of America has some rather large coffers, which may save Countrywide from filing bankruptcy.
In other stock market news, in case you haven't kept up, today is another one of those "market correction" days, as the Dow is down over 285 points as I type this. I'm going to hate looking at my 401K tomorrow...
U.S. At Risk of Losing Triple-A Credit Rating Within a Decade
And guess why? It's the fact that our government is spending way to much on health care, social security, and welfare.
These are the programs the Democrats are looking to spend more money on. This is also some of Fred Thompson's best issues in terms of how we should tackle these problems.
- Create a free-market approach towards health care.
- Individualize and optionally-privatize social security.
- Increase welfare effectiveness so only those that need it get it.
- Decrease number of people on welfare through stimulating economic and employment growth.
That, in itself, would save our credit rating...which is the same rating we have held since the rating was first applied in 1917. In other words, can literally cannot afford to have a tax-and-spend, social-program increasing Democrat in office.
Fiscal prudence is key, and Fred Thompson knows it.
These are the programs the Democrats are looking to spend more money on. This is also some of Fred Thompson's best issues in terms of how we should tackle these problems.
- Create a free-market approach towards health care.
- Individualize and optionally-privatize social security.
- Increase welfare effectiveness so only those that need it get it.
- Decrease number of people on welfare through stimulating economic and employment growth.
That, in itself, would save our credit rating...which is the same rating we have held since the rating was first applied in 1917. In other words, can literally cannot afford to have a tax-and-spend, social-program increasing Democrat in office.
Fiscal prudence is key, and Fred Thompson knows it.
Wednesday, January 9, 2008
Support the Wise County Power Plant
Kilo has a good post up about the support for the proposed Wise County Power Plant. This would be a "clean-burning coal" power plant. Although I do not live near the coalfields of Virginia, I do support this power plant. It will provide jobs, energy, and boost the economy of an area that really needs a project like this to revitalize the county.
Wise County, if you're unfamiliar with it, is located in southwest Virginia, on the border with Kentucky. It is nestled in the mountains and deep in the heart of the Virginia's coal-mining region.
I understand that many people are against using coal for pollution reasons. However, we have technology to make coal usage much more enviro-friendly. Why not give it a chance? It will provide an economic and technological benefit to the coalfields, and a source of energy for the state of Virginia.
Wise County, if you're unfamiliar with it, is located in southwest Virginia, on the border with Kentucky. It is nestled in the mountains and deep in the heart of the Virginia's coal-mining region.
I understand that many people are against using coal for pollution reasons. However, we have technology to make coal usage much more enviro-friendly. Why not give it a chance? It will provide an economic and technological benefit to the coalfields, and a source of energy for the state of Virginia.
Friday, December 28, 2007
Podium Positions: Federal Budget
Budgetary Viewpoints from The Podium...
Military
Understandably, it's hard to reduce spending while fighting two separate military operations. However, as the situation continues to improve in Iraq, we can start projecting how we can save billions just by coming to a favorable end to our occupation of that nation. $145 billion has been allocated for the Global War on Terror, Iraq consumes a large part of that in and of itself. Once Iraq is done with and we wind things down a bit more in Afghanistan, we could cut the current budget deficit of $240 billion in half.
However, we must currently continue to create a favorable outcome in Iraq now, as future U.S.-involved conflict due to leaving Iraq in bad shape would mean future military operations there. To leave Iraq now would lead to more spending later.
Entitlements - Social Security/Medicare/Medicaid/SCHIP/Welfare/Unemployment
Until then, some trimming around the edges of other government programs will be necessary, we need to find a way to do this without hurting those who actually need government assistance.
The introduction of privatized Social Security (at least in an optional sense) would help. The U.S. federal budget will spend $608 billion dollars on Social Security for the fiscal year of 2008. It is the single-most expensive item of spending in our budget, and it gets more expensive each year.
$324 billion will be spent on welfare/unemployment, this can be cut down if we can stimulate job growth "from the ground up", so to speak.
The combined $595 billion spent on Medicare/Medicaid/SCHIP could be made a lot cheaper if we opened up health insurance to the free markets just like car insurance, life insurance, et cetera. You, the individual, find the plan and the price that is right for you. In fact, we can probably even set up government-funded assistance for people who don't quite know what to look for when shopping around for insurance and still cut down on this price tag.
Also, by adopting a more federalist approach, we can defer funding for abortions to the state level, and there the states can decide whether or not they choose to provide funding and assistance for abortion practices on their own, thus removing financial responsibility from the federal government.
Taxes
With lowered spending comes less of a need for taxes. While I'm not calling for the dissolution of the IRS just yet, the combination of lower spending and a simpler tax code would lessen the need for any future tax increases, and may lead to a call for tax decreases.
Overview
Whether we're talking federal, state, or local levels, fiscal prudence will always be an appealing cornerstone for conservatives. The George W. Bush-style of budgeting money has not been fiscally prudent overall. While his tax cuts have kept money in the pockets of those who earned it, spending has continued to increase.
However, the reigning in of spending increases has occurred over the past few years. The federal budget deficit has gone from $390 billion (FY 2006) to about $240 billion (FY 2008). Continued reduction at this rate will lead to a balanced budget, or budget surplus, by Fiscal Year 2011.
We must continue on this track, and find ways to "trim the fat" from our budget.
Optional privatization of social security allows people to make a choice to invest their social security funds, which allows for less spending on social security itself. Lower taxes puts money back in the pockets of those who earned the money in the first place. Less federal spending makes our government less cumbersome and more nimble and flexible to foreign and domestic changes. Finally, the reduction and streamlining of entitlement programs increases the amount of independency American citizens have from the federal government.
Military
Understandably, it's hard to reduce spending while fighting two separate military operations. However, as the situation continues to improve in Iraq, we can start projecting how we can save billions just by coming to a favorable end to our occupation of that nation. $145 billion has been allocated for the Global War on Terror, Iraq consumes a large part of that in and of itself. Once Iraq is done with and we wind things down a bit more in Afghanistan, we could cut the current budget deficit of $240 billion in half.
However, we must currently continue to create a favorable outcome in Iraq now, as future U.S.-involved conflict due to leaving Iraq in bad shape would mean future military operations there. To leave Iraq now would lead to more spending later.
Entitlements - Social Security/Medicare/Medicaid/SCHIP/Welfare/Unemployment
Until then, some trimming around the edges of other government programs will be necessary, we need to find a way to do this without hurting those who actually need government assistance.
The introduction of privatized Social Security (at least in an optional sense) would help. The U.S. federal budget will spend $608 billion dollars on Social Security for the fiscal year of 2008. It is the single-most expensive item of spending in our budget, and it gets more expensive each year.
$324 billion will be spent on welfare/unemployment, this can be cut down if we can stimulate job growth "from the ground up", so to speak.
The combined $595 billion spent on Medicare/Medicaid/SCHIP could be made a lot cheaper if we opened up health insurance to the free markets just like car insurance, life insurance, et cetera. You, the individual, find the plan and the price that is right for you. In fact, we can probably even set up government-funded assistance for people who don't quite know what to look for when shopping around for insurance and still cut down on this price tag.
Also, by adopting a more federalist approach, we can defer funding for abortions to the state level, and there the states can decide whether or not they choose to provide funding and assistance for abortion practices on their own, thus removing financial responsibility from the federal government.
Taxes
With lowered spending comes less of a need for taxes. While I'm not calling for the dissolution of the IRS just yet, the combination of lower spending and a simpler tax code would lessen the need for any future tax increases, and may lead to a call for tax decreases.
Overview
Whether we're talking federal, state, or local levels, fiscal prudence will always be an appealing cornerstone for conservatives. The George W. Bush-style of budgeting money has not been fiscally prudent overall. While his tax cuts have kept money in the pockets of those who earned it, spending has continued to increase.
However, the reigning in of spending increases has occurred over the past few years. The federal budget deficit has gone from $390 billion (FY 2006) to about $240 billion (FY 2008). Continued reduction at this rate will lead to a balanced budget, or budget surplus, by Fiscal Year 2011.
We must continue on this track, and find ways to "trim the fat" from our budget.
Optional privatization of social security allows people to make a choice to invest their social security funds, which allows for less spending on social security itself. Lower taxes puts money back in the pockets of those who earned the money in the first place. Less federal spending makes our government less cumbersome and more nimble and flexible to foreign and domestic changes. Finally, the reduction and streamlining of entitlement programs increases the amount of independency American citizens have from the federal government.
Wednesday, December 26, 2007
Kudlow: "President Bush had a very good year"
In a Washington Times column today, Lawrence Kudlow noted that, despite all of the negativity and criticism of his campaign, President Bush has had a good year.
The troop surge in Iraq is succeeding. America remains safe from terrorist attacks. And the Goldilocks economy is outperforming all expectations.
True enough, especially when you look at these numbers...which come despite the subprime crisis and overall housing market downturn.
- Headline inflation - 2.5%
- Core inflation - 2%
- Real GDP growth - 3%
- Consumer spending - 3%
- Jobs increasing at rate of 100,000/month
- Stock market continues to go up despite obstacles
Kudlow also notes Bush's legislative victories, economic optimism, and his crusade against wasteful spending and pork-barrel earmarks.
Mr. Bush's optimism is well-earned, in Congress too. He has stopped a lot of bad legislation on higher taxing and spending. He won on S-CHIP (State Children's Health Insurance Program) and the alternative minimum tax. He mostly prevailed on domestic spending. And he got much of what he wanted on war funding without any pullout dates.
And he is not yet finished. In the most dramatic statement of his holiday news conference, Mr. Bush said he will not stand for continuing congressional proliferation of pork-barrel earmarks.
"Another thing that's not responsible is the number of earmarks the Congress included in the massive spending bill," said Mr. Bush. "The bill they just passed includes about 9,800 earmarks. Together with the previously passed defense spending bill, that means Congress has approved about 11,900 earmarks this year. And so I am instructing Budget Director Jim Nussle to review options for dealing with wasteful spending in the omnibus bill."
This is huge. The statute of limitations for Republican overspending, over-earmarking, and over-corrupting that caused huge congressional losses in last year's campaign will not run out until the GOP shows taxpayers it again can be trusted on key issues of limited government and lower taxes.
In these matters, Republicans must be holier than the pope. And while President Bush has been doing the Lord's work with his newfound veto pen, he must continue to wage war on earmarks if the GOP is to cleanse the political memory of Tom DeLay, Jack Abramoff, and Randy "Duke" Cunningham.
This behemoth spending-bill was porked-up with such essential items as rodent control in Alaska ($113,000); olive fruit-fly research in France ($213,000); a hunting and fishing museum in Pennsylvania ($200,000); a bike trail in Minnesota ($700,000); a post office museum in Las Vegas ($200,000); and a $2 million monument to Rep. Charlie Rangel in New York.
Will Rangel's monument be inscribed with his quote that "Dick Cheney is a real son of a bitch"? Just wondering, since my federal tax dollars are going to support a project like this.
Kudlow finishes with some optimism and advice for how the GOP should go forward in making the economy even better.
Republicans also can take credit for outmaneuvering the Democrats on a patch for the AMT. The Democrats were made to waive the pay-as-you-go budget rule that might have forced tax increases on businesses and investment pools. Stopping this tax hike is a singular Republican achievement, while the AMT will now be indexed for inflation, thereby sparing more than 20 million taxpayers.
Looking ahead, the economy also would benefit from a corporate tax cut for both large and small businesses, including corporate capital-gains. The U.S. dollar would reap the rewards as new investment flowed in from the world. Several recent studies also show businesses would pass on tax-cost savings to the work force, thereby bolstering wages and ultimately creating new jobs.
Hokey ideas for temporary tax rebates? They should be ignored. But if the president and Republicans wipe out earmarks, hold down spending, and pass a bold corporate tax cut, Goldilocks will be nourished and sustained. Come November 2008, Republicans might be back in the driver's seat.
The troop surge in Iraq is succeeding. America remains safe from terrorist attacks. And the Goldilocks economy is outperforming all expectations.
True enough, especially when you look at these numbers...which come despite the subprime crisis and overall housing market downturn.
- Headline inflation - 2.5%
- Core inflation - 2%
- Real GDP growth - 3%
- Consumer spending - 3%
- Jobs increasing at rate of 100,000/month
- Stock market continues to go up despite obstacles
Kudlow also notes Bush's legislative victories, economic optimism, and his crusade against wasteful spending and pork-barrel earmarks.
Mr. Bush's optimism is well-earned, in Congress too. He has stopped a lot of bad legislation on higher taxing and spending. He won on S-CHIP (State Children's Health Insurance Program) and the alternative minimum tax. He mostly prevailed on domestic spending. And he got much of what he wanted on war funding without any pullout dates.
And he is not yet finished. In the most dramatic statement of his holiday news conference, Mr. Bush said he will not stand for continuing congressional proliferation of pork-barrel earmarks.
"Another thing that's not responsible is the number of earmarks the Congress included in the massive spending bill," said Mr. Bush. "The bill they just passed includes about 9,800 earmarks. Together with the previously passed defense spending bill, that means Congress has approved about 11,900 earmarks this year. And so I am instructing Budget Director Jim Nussle to review options for dealing with wasteful spending in the omnibus bill."
This is huge. The statute of limitations for Republican overspending, over-earmarking, and over-corrupting that caused huge congressional losses in last year's campaign will not run out until the GOP shows taxpayers it again can be trusted on key issues of limited government and lower taxes.
In these matters, Republicans must be holier than the pope. And while President Bush has been doing the Lord's work with his newfound veto pen, he must continue to wage war on earmarks if the GOP is to cleanse the political memory of Tom DeLay, Jack Abramoff, and Randy "Duke" Cunningham.
This behemoth spending-bill was porked-up with such essential items as rodent control in Alaska ($113,000); olive fruit-fly research in France ($213,000); a hunting and fishing museum in Pennsylvania ($200,000); a bike trail in Minnesota ($700,000); a post office museum in Las Vegas ($200,000); and a $2 million monument to Rep. Charlie Rangel in New York.
Will Rangel's monument be inscribed with his quote that "Dick Cheney is a real son of a bitch"? Just wondering, since my federal tax dollars are going to support a project like this.
Kudlow finishes with some optimism and advice for how the GOP should go forward in making the economy even better.
Republicans also can take credit for outmaneuvering the Democrats on a patch for the AMT. The Democrats were made to waive the pay-as-you-go budget rule that might have forced tax increases on businesses and investment pools. Stopping this tax hike is a singular Republican achievement, while the AMT will now be indexed for inflation, thereby sparing more than 20 million taxpayers.
Looking ahead, the economy also would benefit from a corporate tax cut for both large and small businesses, including corporate capital-gains. The U.S. dollar would reap the rewards as new investment flowed in from the world. Several recent studies also show businesses would pass on tax-cost savings to the work force, thereby bolstering wages and ultimately creating new jobs.
Hokey ideas for temporary tax rebates? They should be ignored. But if the president and Republicans wipe out earmarks, hold down spending, and pass a bold corporate tax cut, Goldilocks will be nourished and sustained. Come November 2008, Republicans might be back in the driver's seat.
President Bush's Statement on H.R. 2764
Otherwise known as the Omnibus Spending Bill.
Today, I signed into law H.R. 2764, legislation that will fund the Federal Government within the reasonable and responsible spending levels I proposed - without raising taxes and without the most objectionable policy changes considered by the Congress. This law provides a down payment for the resources our troops need, without arbitrary timelines for withdrawal. The Congress should quickly take action next year to provide the remainder of the funding needed by our troops.
I am disappointed in the way the Congress compiled this legislation, including abandoning the goal I set early this year to reduce the number and cost of earmarks by half. Instead, the Congress dropped into the bill nearly 9,800 earmarks that total more than $10 billion. These projects are not funded through a merit-based process and provide a vehicle for wasteful Government spending.
There is still more to be done to rein in Government spending. In February I will submit my budget proposal for fiscal year 2009, which will once again restrain spending, keep taxes low, and continue us on a path towards a balanced budget. I look forward to working with the Congress in the coming year to ensure taxpayer dollars are spent wisely.
Finally, this legislation contains certain provisions similar to those found in prior appropriations bills passed by the Congress that might be construed to be inconsistent with my Constitutional responsibilities. To avoid such potential infirmities, the executive branch will interpret and construe such provisions in the same manner as I have previously stated in regard to similar provisions.
Hopefully, we can have less earmarks and "pork-barrel" spending, and we can further reduce the budget deficit, which has been on a steady decline over the past few years.
(h/t News Blaze)
Today, I signed into law H.R. 2764, legislation that will fund the Federal Government within the reasonable and responsible spending levels I proposed - without raising taxes and without the most objectionable policy changes considered by the Congress. This law provides a down payment for the resources our troops need, without arbitrary timelines for withdrawal. The Congress should quickly take action next year to provide the remainder of the funding needed by our troops.
I am disappointed in the way the Congress compiled this legislation, including abandoning the goal I set early this year to reduce the number and cost of earmarks by half. Instead, the Congress dropped into the bill nearly 9,800 earmarks that total more than $10 billion. These projects are not funded through a merit-based process and provide a vehicle for wasteful Government spending.
There is still more to be done to rein in Government spending. In February I will submit my budget proposal for fiscal year 2009, which will once again restrain spending, keep taxes low, and continue us on a path towards a balanced budget. I look forward to working with the Congress in the coming year to ensure taxpayer dollars are spent wisely.
Finally, this legislation contains certain provisions similar to those found in prior appropriations bills passed by the Congress that might be construed to be inconsistent with my Constitutional responsibilities. To avoid such potential infirmities, the executive branch will interpret and construe such provisions in the same manner as I have previously stated in regard to similar provisions.
Hopefully, we can have less earmarks and "pork-barrel" spending, and we can further reduce the budget deficit, which has been on a steady decline over the past few years.
(h/t News Blaze)
Monday, December 24, 2007
What Did I Tell You?
The "reverse migration" of illegal immigrants has already begun.
I was advocating this "solution by attrition" over at Daily Whackjob in a heated discussion I was having with others over illegal immigration. I stated that if you take away the jobs/handouts available to illegal immigrants, and that if you make them believe that we're going to actually get serious as a nation on immigration control, they'll start to leave on their own.
Now, the article admits that part of the reason is the slowdown of economic growth has some illegals worried that the number of jobs available are going to shrink. This, combined with states cracking down on employers of illegal aliens, does not make many places that were once safe havens for illegal immigrants very appealling anymore.
Want to know who else has stated this theory as part of the solution to the illegal immigrant problem? Fred Thompson, of course.
I was advocating this "solution by attrition" over at Daily Whackjob in a heated discussion I was having with others over illegal immigration. I stated that if you take away the jobs/handouts available to illegal immigrants, and that if you make them believe that we're going to actually get serious as a nation on immigration control, they'll start to leave on their own.
Now, the article admits that part of the reason is the slowdown of economic growth has some illegals worried that the number of jobs available are going to shrink. This, combined with states cracking down on employers of illegal aliens, does not make many places that were once safe havens for illegal immigrants very appealling anymore.
Want to know who else has stated this theory as part of the solution to the illegal immigrant problem? Fred Thompson, of course.
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