Friday, August 28, 2009

Government Motors sales blitz a success?

The cash for clunkers program is considered a smashing success.In the context of being a taxpayer debt financed bailout,it was as nearly 700,000 cars were sold.It was a true stimulus like a credit card.Instant results with the payback coming later.Weighing the cost vs. the benefits seems impossible.Cars were sold benefiting the entire automaker to consumer chain.Fuel consumption will drop by millions of gallons annually.There are losers also.Gas tax revenues will drop,charities lose out,the mechanics keeping the clunkers on the road,etc.

These are just a few of the industries affected in one way or the other.I figure it's virtually impossible to calculate the cost or benefit of every one to decide if the program was worth it.But the fact is that the program moved thousands of cars.This brings me to another question.Would we have been better served to have spent the tens of billions we have already spent to bailout the automakers on a similar sales incentive program open to everyone instead?

Time magazine reported we have spent $83 billion so far on the auto bailouts.That didn't include the cash for clunkers program and they also claim the total could exceed $100 billion.Could we have put that money into a massive subsidy program designed to build and sell cars?I didn't and still don't support the bailouts at all,but I'm just another one of the constituents that our members of Congress don't listen too so it's a moot point.But just think about it.If $3 billion sold 700,000 cars,my trusty calculator says that $83 billion sells over 19 million cars.

The entire industry sold 13.2 million cars in 2008 including foreign automakers.So we could have exceeded the entire annual global sales by far for the money.How many jobs would that have created?We would have needed the car dealers forced to close just to accommodate the vehicle inventory.The automakers,dealers,suppliers,advertisers and anyone else involved in the business would be setting records,making money and hiring workers.The creditors and investors that got shafted in the bankruptcy would have been saved.

So,take your choice.Was the auto bailout about the Federal Government taking control of the industry or could they have saved it in this manner?More to come...

Tuesday, August 25, 2009

High tide is coming!

If you haven't heard of the Tides Center or the Tides Foundation,you certainly will be soon.These far left non-profit groups are aligned with George Soros' OSI group and the Apollo Alliance and they are creating the blueprints for Obama and Congress on the stimulus,cap and trade and healthcare reform.

This is not an opinion,it's fact.Check it out yourself.The Apollo Economic Recovery Act(AERA) is the stimulus blueprint except that Congress took the recommendations and allotted even more money than was suggested.Here is the bulletin from the Apollo website.

Apollo Economic Recovery Act — News Release
Proposed Apollo Economic Recovery Act Will Yield 650,000 Green-Collar Jobs
WASHINGTON, Dec. 6 — The Apollo Alliance, a national coalition of business, labor, environmental and community leaders, today proposed a comprehensive quick start, clean energy economic recovery strategy to immediately create or retain 650,000 direct green-collar jobs and an additional 1.3 million indirect jobs in communities across the country.
The Alliance’s proposed Apollo Economic Recovery Act responds directly to President-elect Barack Obama’s call last week for a “big stimulus package” in January to “jolt” the economy and “lay the groundwork for long- term, sustained economic growth.”
“With a new president and Congress taking office in January, we have a tremendous opportunity to put America on the path to economic recovery while also moving us toward climate stability and energy security,” said Apollo Alliance Chairman Phil Angelides. “Now is the time to turn big ideas into reality - to look forward to bold solutions.”
For More Information:

Download the PDF
Apollo Economic Recovery Act — The Full Proposal
Data Points: Economic Recovery Act Outcomes For Clean Energy Job Creation and Investment
The New Apollo Program
Signature Stories
A critical component of any proposal to revive the economy, the Apollo Economic Recovery Act calls for a one-year, $50 billion investment to restore America’s economic strength while ending our nation’s reliance on foreign oil and speeding our transition to a new, more prosperous clean energy economy.
The Alliance’s proposal calls for immediate targeted federal investments next year to improve energy efficiency in buildings, advance federal clean energy tax credits, expand home weatherization programs, modernize the transmission grid, sharply increase federal investments in rapid transit, and repair roads and bridges.
Founded In New Apollo Program ProposalsThe Apollo Economic Recovery Act accelerates investments called for in
The New Apollo Program, a comprehensive national clean energy economic development strategy released this fall in communities across the nation and supported by over 50 major U.S. business, labor, environmental and community organizations.
The New Apollo Program calls for a 10-year, $500 billion program of federal investment to create 5 million jobs while helping to solve the climate crisis, the energy crisis, and the economic crisis facing the nation. The program outlines the need for a sweeping set of actions - major commitments to energy efficiency, dramatic increases in the use of renewable energy, a reinvigorated manufacturing base for advanced fuel-efficient vehicles - to put Americans to work. It is intended to renew the nation’s commitment to innovation, research and development, science, and work force training and education. And it proposes a cap and invest system that puts a price on carbon, and generates the financial resources needed for America to make the transition to a clean energy economy. “The Apollo Economic Recovery Act is a first year down payment on building a clean energy, good jobs “made in America” economy as envisioned in The New Apollo Program. It is also an immediate shot in the arm to boost America’s economy and put our people back to work. We need to take steps now to support American businesses and workers so that they can set their feet firmly on the path to this new energy economy” said Mr. Angelides.
He called upon the president-elect and Congress to implement the Apollo Economic Recovery Act, which also will train at least 300,000 Americans to participate in the clean energy economy through workforce development, apprenticeship, service, and education programs.
For More Information:
Keith Schneider, 231-920-0745,
keith@apolloalliance.orgHeidi Pickman, 415-371-1700 ext.208,

Van Horn is the Apollo director and has been appointed the "green jobs czar" by Obama.He is an admitted communist and can also be credited with the creation of the cash for clunkers program,except he called them "Hoopties 4 Hybrids".

The Healthcare for America Now group has written the blueprint for healthcare reform.They are also funded thru the Tides.Here is the "about us" script from their website showing their ties.

Who supports HCAN?
Health Care for America Now and its
principles for reform are supported by President Obama, Vice President Biden, and more than 190 Members of Congress. HCAN has more than 1,000 member organizations in 46 states. We are doctors, nurses, community organizations, labor unions, small business owners, faith-based groups, people of color, seniors, and children’s and women’s rights groups.
For the complete list of HCAN members,
view our membership list.
Our Steering Committee includes: ACORN, AFL-CIO, AFSCME, AFT, Americans United for Change, Campaign for America’s Future, Center for American Progress Action Fund, Campaign for Community Change, Children’s Defense Fund Action Council, Communications Workers of America, International Union, United Automobile, Aerospace & Agricultural Implement Workers of America (UAW),, NAACP, National Council of La Raza, National Education Association, National Women’s Law Center, SEIU, UFCW, USAction, Women's Voices, Women's Vote and Working America.
Legal Disclaimer
Health Care for America Now! (“HCAN”) is a section 501(c)(4) issue advocacy organization. Members of the HCAN coalition include a wide range of nonprofit and political organizations that are working to promote quality, affordable health care for all Americans. HCAN’s members are tax-exempt public charities, advocacy organizations and unions, as well as political action committees (“PACs”) and “527” organizations. HCAN and each member organization only conduct and fund activities appropriate to its tax and election law status. HCAN is related to Health Care for America Education Fund, a project of The Tides Center, a section 501(c)(3) public charity.

Want to know what legislation and social agenda items are upcoming?Simply follow along with these extremist groups as they are working hand in hand with Obama to dictate his agenda.It's not secretive,they want you to know their agenda.Sure,they keep the donors funding secret as this is the point of the Tides non-profit system set-up by Drummond Pike.The point is if anyone really believes that these huge bills being rammed down our throats are actually being created by Congress and their contents debated,you're a fool.More to come...

Saturday, August 22, 2009

Liberal follies

Life as a liberal.When we only get one go-round at it,why waste it?Ignorance would be an acceptable reason but I think most have their eyes wide open.The easy solution would be for France to just take them all and leave America to realize it's potential.But,this just wouldn't be America without hardship and the constant threats to our liberty now would it?

For you libs,just a few questions.Why is it a bad thing to be self-reliant?To have pride?To have the American spirit ingrained in us and rely on it?To insure that you are not a burden to society?To be accountable and accept responsibility when you fail?

These attributes are strengths,not weaknesses.Failure is not weakness.Putting forth the effort and giving it your best shot makes you a winner in life,not just in sports.Working hard everyday doesn't guarantee anything in a material fashion.You may not ever accumulate what your neighbor has despite your best efforts.But this in no way entitles you to a piece of their pie.

Yet,this is the way of a liberal.Health insurance for everyone,even if they don't want it.Lose your job,society will pay your way.Cradle to grave government dependence.To not agree is to not be compassionate.So,we have the myriad of entitlement programs that are designed to lock in the democratic voting block.

Our Judeo-Christian heritage is discounted as well as our Constitution.Out of date and from another era we are told.These are roadblocks to the liberal agenda and must be trivialized.I find it far preferable to rely on human compassion in the honest sense of it.Forced charity and wealth redistribution thru government destroys this honest sense.You feel much better when you give out of compassion as opposed to legislation.This really leaves the only true difference between a conservative and a progressive/liberal as the means in which compassion is delivered.Conservatives prefer to rely on our heritage as a bedrock and to help the disadvantaged out of desire.Progressives prefer the forced version which retains power in the hands of the central government.

The progressive movement can be traced back prior to the civil war as a response to slavery.The current version was re-shaped by Drummond Pike in the 70's and his influence is enormous thru the Tides Foundation and the Tides Center.This is the clearinghouse for all donors to progressive causes.It's non-profit status and multi-layered web allows the donors to remain anonymous and un-connected to causes they support.Today,all the labor unions,community organizations and "green" groups funnel thru the Apollo Alliance at the direction of the Tides.Obama sits on top and oversees all.

Obviously,we are dealing with a deeply rooted,well-funded hierarchy.With backers led by George Soros,huge corporations,environmental groups,etc.,they have all the money necessary to push their agenda.They have a massive laundry list of causes.They have the media in their pocket.Without question,it's the ultimate threat to liberty.

What they don't have is the will of the people.The majority of Americans still have core conservative values and this is the glue that holds this country together despite the threat.Their strategy shifts over the years,but remains essentially the same.Take advantage of our compassion to exploit issues.Who doesn't support saving the planet issues?Developing alternative fuels?Assisting the sick,elderly and down on their luck?They use all of these angles as the opening they need to take away our liberty.

Which brings me back to the point of this post.Will it ever be possible for liberals to realize that they can support these issues and be charitable on their own?Without funneling it thru the government and destroying our liberty?They would find that conservatives indeed support many of the same causes,but refuse to give away our liberty in the process of supporting them.I see this as the holy grail.Educating these people who would sway more right if they could see the light at the end of the tunnel.Find alternative methods to support their causes without sacrificing liberty.You would marginalize the far left extremists to just another fringe group.It's not impossible and it's the only legitimate long-term solution to this battle.This is not reaching across the aisle to accomodate the left.It's simply making them aware that there are options and alternatives to what they've been brainwashed into believing.More to come...

Friday, August 21, 2009

Obama accepts his fate,or does he?

Gibbs stated on Friday that Obama is quite comfortable being a one-term President.He needs to get comfortable because that is his fate.Yet,I don't see it as fate.I see it as planned all along.I take you back to my July 19th post about needing a p.s.i. guage to monitor the bubbles.I wrote just that,that he will be a one-termer and that has been his intention all along.Push the ideological agenda no matter what.He is a sacrificial lamb.Maybe he hopes to be a martyr after the dust settles.But this is why this man is to be feared.When a President has his re-election concerns to keep him in check and those of his party as well,he doesn't go overboard on implementing agenda.This is clearly not the goal of Obama and he will take no prisoners in his quest for ideology.

In the beginning of his term,most did not know him and any alarm bells being rung were from so-called extremists.This is beginning to change as we learn more and more.Of course,many will not believe the worst because of what they have invested in him.They voted for him,bought into the hope and change and now have a version of skin in the game.It's a personal loss to admit they were wrong and thus it won't happen overnight.

We still hear that we have to give him a chance.Don't be the party of no.Let the stimulus work.I don't believe you can take this approach in politics because the penalty is too great.If you're wrong on someone,you pay heavily and possibly irreversibly.Take Sotomayor,for example.If the yeahs' were wrong,we will pay for the rest of her lifetime appointment.

We don't have a President with training wheels or no executive experience or has never run a business.These are the standard reasons to attack him.I say it doesn't matter because he's not out there making mistakes while learning on the job.He's doing exactly what he planned.So buckle in for the remainder of a rough ride because by the time everyone gets on board with reality,the damage will be done and be massive.More to come...

Financial disaster next week?

Did Obama and Bernanke really save us from the financial apocalpse?Read the following and decide or go to Lew Rockwell and read it so you can view the charts.

Days Away From Economic Chaos?
by Bill Sardi
Recently by Bill Sardi: Americans Are Vitamin C Deficient

America is just a few days away from a possible day of reckoning. I again call attention to this day, August 25, when the Federal Deposit Insurance Corporation issues its 2nd Quarter report for 2009 on the state of health of American banks.
It has not particularly alarmed Americans that its growth and prosperity have been built upon debt. The American public is a bit desensitized, particularly since the Y2K threat fizzled. We must wait and see how Americans respond to the upcoming FDIC report.
The following charts tell the story. There are roughly 8400 American banks that set aside a small portion of their profits to aggregately insure bank depositors should their local bank fail. A plethora of bank failures has depleted the FDIC reserve fund from $52.8 billion in 2008 to $13 billion in the 1st Quarter of 2009. (See chart below)
Alison Vekshin, writing for Bloomberg, indicates
"The failure of 77 banks this year is draining the fund, prompting the agency in May to set an emergency fee of 5 cents for every $100 of assets, excluding Tier 1 capital, to raise $5.6 billion in the second quarter. The agency has authority to set fees in the third and fourth quarters, if needed, to prevent a decline in the fund from undermining public confidence."
Vekshin goes on to report that 56 bank failures since March 31 have cost the FDIC an estimated $16 billion. (For comparison, in the 1st Quarter, bank failures only cost the FDIC $2.2 billion.) That $16 billion bank rescue would fully deplete the FDIC fund as it only had $13 billion at the close of the 1stQuarter. It’s possible the FDIC has already tapped into its line of credit at the Treasury Department without setting off alarm bells to the public.
The FDIC is required by law to maintain a reserve ratio, or balance divided by insured deposits, of 1.15 percent. It was at 0.27 percent as of March 31. It could be near zero at the current moment. (See 1st Quarter FDIC reserve ratio chart below)
Banks will be assessed extra fees
The FDIC's 8400 banks will likely be assessed special fees to shore up the FDIC's treasure chest.
Bloomberg’s Vekshin, quoting Robert Strand, a senior economist at the American Bankers Association, says the industry will pay $17 billion in premiums this year, including $11.6 billion from the annual fee.
The following chart shows the aggregate profits of all 8400 FDIC-insured banks, which is about $5–7 billion per quarter. This figure is AFTER the banks have set aside funds for anticipated losses in real estate loans.
Insured institutions set aside $60.9 billion in loan loss provisions in the 1stQ, an increase of $23.7 billion (63.6 percent) from the first quarter of 2008.
Hiding losses
Banks have been slow to foreclose, allowing mortgage holders a few months before their home is deemed in default and giving another 2 years before the property is foreclosed on its accounting books. This practice has been able to temporarily hide most of the banking collapse.
But banks must eventually write down their real estate home mortgage losses. First-quarter net charge-offs of $37.8 billion were slightly lower than the $38.5 billion the industry charged-off in the fourth quarter of 2008.
As banks write off bad home loans, this downsizes their asset values. Downsizing at a few large banks caused $302-billion decline in industry assets in the 1stQ. The FDIC report says:
Total assets declined by $301.7 billion (2.2 percent) during the quarter, as a few large banks reduced their loan portfolios and trading accounts. This is the largest percentage decline in industry assets in a single quarter in the 25 years for which quarterly data are available. Eight large institutions accounted for the entire decline in industry assets;
You can see by the following chart that US banks are directing a great deal of their profits towards write-offs (loss provision in the following chart) for non-paying home mortgages (foreclosures). So the banks only have about $5–7 billion of profit to direct to the FDIC to shore up its quickly vanishing reserve account. This aggregate profit equates to about $890,000 profit per bank in a quarter. That is a pretty thin margin.
Zombie banks
The FDIC, which claimed only about 300 problem banks in the 1st Quarter of 2009, but hid the fact there were about 2000 total lame banks among its 8400 members, This has given rise to the term "zombie banks," which are defined as "a financial institution with an economic net worth that is less than zero, but which continues to operate because its ability to repay its debts is shored up by implicit or explicit government credit support."
Examination of the following FDIC chart shows geographically that most banks are not making a profit.
FDIC's $13 billion against $220 billion liabilities
So just how much liability does the FDIC bear aggregately for its "problem banks?"
At the end of the 1st Quarter in 2009 the FDIC said that figure was $220 billion. Remember now, the FDIC had only about $13 billion to over these institutions at the time. (See chart below) This figure will likely grow beyond imagination with the issuance of the FDIC 2ndQ report.
How do American banks make profit today?
So how to American banks make any money today? You can see in the following chart that in the recent past American banks derived most of their profits (45%) from residential and commercial property loans. These income sources are obviously crashing.
So the FDIC 1st Quarter report tells all – our so-called conservative American bankers, entrusted with your hard-earned savings, with no place to turn to generate traditional profits, have entered the gambling parlor. Here is how the FDIC said it:
Sharply higher trading revenues at large banks helped FDIC-insured institutions post an aggregate net profit of $7.6 billion in the first quarter of 2009.
Trading revenues means profit generated from trading stocks and other risky investments. Recall, when your money was being financed commercial and residential property it had some collateral behind it. An asset (real estate) was held in balance against the risk of failure to pay the loan. Now bankers are "investing" your money in the stock market in what appears to be a replay of how the Japanese propped up their stock market in recent years – by simply having major companies purchase each other’s shares to prop up value.
The FDIC's 1stQ report says: "Total equity capital of insured institutions increased by $82.1 billion in the first quarter, the largest quarterly increase since the third quarter of 2004 (when more than half of the increase in equity consisted of goodwill)."
What the hoot is "goodwill" you want to know? It is how the banks are cooking their books. Arbitrary value is being given to bank holdings.
The FDIC 1stQ report goes on to say that:
Most of the aggregate increase in capital was concentrated among a relatively small number of institutions, including some institutions participating in the U.S. Treasury Department’s Troubled Asset Relief Program (TARP).
Banks valued by goodwill and bailout funds
So there, you can see that in addition to goodwill, the bank's capital was largely increased by bailout funds. So a dose of reality therapy will lead one to conclude that nearly all American banks are essentially insolvent.
If this leaves you feeling a bit queasy, well, you may need to reach for Dramamine when you realize the FDIC is not only broke, but it will probably announce it is tapping into its line of credit at the US Treasury Department, which is also insolvent (America is spending $1.58 trillion more than it collects in taxes this year).
Here is how Bloomberg’s Vekshin says it:
If the fund is drained, the FDIC also has the option of tapping a line of credit at the Treasury Department that Congress extended in May to $100 billion, with temporary borrowing authority of $500 billion through 2010.
Compared with savings and loan crisis
American banks weathered the savings and loan/real estate appraisal crisis in the 1980s and 1990s by loading from the US Treasury. In 1991–92, during the last part of the savings and loan crisis, the FDIC borrowed $15.1 billion from the Treasury and repaid it with interest about a year later.
But just exactly how will American banks ever pay back the treasury while facing years of write-offs from home mortgages? The banks do not have sufficient profits to offset their losses.
The entire cost of the savings and loan crisis of the 1980s and 90s was finally calculated at $153 billion, which was four times the reserves held by the FDIC (FSLIC at the time) in 1982. Of this, taxpayers paid out $124 billion while the thrift industry itself paid $29 billion. (FDIC Banking Review, volume 13, no.2, December 2000) So there is a false notion that the banks underwrite their own members’ losses. In fact, the public bears the brunt of the losses when bankers are reckless.
Bankers prodded to loan money
Sheila Bair, FDIC chief, is trying to get US bankers to begin loaning money again. But to do so bankers must begin to assess the worth of real estate at more realistic values. Then the real value of their asset package would be revealed and the banks would all collapse. Furthermore, if banks begin to loan money under their fractional banking scheme (banks loan out 10–50 fold more money than they have in reserve), then massive inflation will likely result. This would not only result in Americans bearing the brunt of higher cost of goods and services, but it could trigger Asian banks, seeing their savings devalued, to sell off their stash of US treasury bonds. America as a debtor nation depends upon billions of dollars every day, loaned from Asian banks, to stay afloat financially.
The FDIC's Bair is aghast at American bankers shift away from traditional sources of revenue backed by collateral to risky investments. Bair wants to charge banks additional fees tied to risks when their business expands beyond traditional lending, such as stock trading. This idea hasn’t advanced in Congressional committees yet. American bankers are walking a tight rope with their depositors’ money.
The mother of all bank runs?
Now if just a small portion of American bank depositors hear that the FDIC had to tap into the US Treasury for funds, and these depositors feel their banked money is at risk and want to withdraw some of it, the mother of all bank runs could ensue. This could create the day of reckoning that many have predicted. A short banking holiday would have to be declared and who knows what happens from there – troops in the streets, issuance of new currency, martial law? Don’t think those in the Federal government haven’t made plans for such an occurrence.
The unbanked
Of surprising interest, the FDIC reveals that millions of Americans don’t trust or don’t use banks. These Americans have been called the unbanked or underbanked, meaning that they "do not have access to banks or are not fully participating in the mainstream financial system," says the FDIC. The FDIC guesstimates that 10 percent of American families are "unbanked." That’s a lot of capital the banks don’t have access to. Those who hold currency outside of banks are anathema to the gods of banking.
Sources: Alison Vekshin, FDIC May Add to Special Fees as Mounting Failures Drain Reserve, Bloomberg News August 20, 2009; FDIC 2ndQuarter report 2009.
August 21, 2009
Bill Sardi [send him mail] is a frequent writer on health and political topics. His health writings can be found at He is the author of You Don’t Have To Be Afraid Of Cancer Anymore.
Copyright © 2009 Bill Sardi Word of Knowledge Agency, San Dimas, California. This article has been written exclusively for and other parties who wish to refer to it should link rather than post at other URLs.
The Best of Bill Sardi

Thursday, August 20, 2009

A way to bring the $4,000 GM car here

It appears that the clunker program is about to be put to bed as the $3 billion has been spent.It's probably run it's course anyway and dealers are dropping out in droves.Pretty amazing that they would turn their backs on a free $4,500 but that is the cost of government regulation.

Interesting that GM now plans to build a $4,000 car that we can't buy here and they have no intention to ever sell here.Why?The cost of government regulation,of course.Meeting the federal safety and emissions standards takes the car out of our marketplace.Now,that certainly is another debate completely on the merits of these standards.No one would argue that they would prefer a less safe car that pollutes more.

I just find the comparison compelling.For less than the cost of the clunker bailout which is another wealth redistribution program,you can buy a brand new car.For the taxpayers $4,500,we gain a few mpg and less carbon emissions but we junk an otherwise perfectly usable car.This helps the car makers with the sales.It hurts charities and now requires the new owner to take on a car payment and carry full coverage insurance.No clear cut winner either way.

Would it be better to make a $4,000 car available to the masses which provides a brand new car with a warranty and gives them options on their clunker.Sell it,keep it,donate it,whatever.This option is at no cost to taxpayers and would most certainly be a jobs creator and the sales numbers would likely dwarf the clunker program results.There are,of course,a number of Americans that would never drive a small death trap car,but due to economic reality,many more would.

Which brings us to the question of priority.The only reason Congress ever put in place the clunker program is that they could do it under the guise of being green and climate friendly.Selling the new GM car at $4,000 would not do this and thus would never fly.We know that the economic reasons for any of these actions are only valid if we don't compromise the Pelosi planet.

Why not follow the cap and trade template we are going to have shoved down our throat?We will allow polluter companies to purchase credits rather than actually comply and reduce emissions.I'm not even going to address the validity of these,this is just for comparison.So,why not allow consumers to pay the penalty credit for a car that doesn't meet U.S. emissions standards?Conversely,consumers buying cars that exceed the government regulations would get rebates.

The estimated cost of a carbon offset credit is predicted by the CBO to trade at $28.This approach would not be a large expense in the scenario above.You could even throw in the other argument you would hear about safety.A less safer vehicle would result in more injuries and those costs would be borne by society in increased healthcare.So you need a penalty for that as well.

The cheapest car available currently in the U.S. is just under $10,000.Tack on the penalties to the $4,000 car and you'll still be well under this number.I don't support any of these scenarios at face value,however,we have to deal in reality and these issues are here to stay.In the interest of compromise,why not use this as a work-around to the rules in play?Car sales would go up and jobs accordingly.More to come...

Tuesday, August 18, 2009

Get your A.R.R.A. T-shirts

3.5 million jobs saved or created by deficit spending $787 billion was the promise.Can we get the Bureau of Labor Statistics to officially track this mythical "saved" number we are promised?I mean,BLS statistics show 2.2 million jobs lost in Feb. thru July.Did this include any of the 3.5 million?Possibly it doesn't because we are told that only a miniscule sliver of the stimulus money has been spent,so it stands to reason that it hasn't "saved or created" much of it's promised 3.5 million.

Obama did,however,proclaim on June 8th that he would direct his people to step up 10 major stimulus programs and create 600,000 new jobs over the next 100 days.Today is day 72 meaning 432,000 jobs have been created.So the 2.2 million would have been over 2.6 million were it not for saving things like the Pelosi salt marsh mouse.

You've seen the road signs proclaiming that a road project is being funded by stimulus dollars.I propose we hand out T-shirts to the people whose jobs have been "saved" by the stimulus.This would help us identify that these job savings are real and help promote the positive aspects of the stimulus.This would also aid the IRS in identifying them as they should have to pay reciprocity fees for having their job saved.Wear it with pride!More to come...

Thursday, August 13, 2009

Finally,you're keeping your money

Cost of Government Day 2009 has arrived on August 12th,day 224 of the year and 26 days later than last year.This means on average 61.34% of your gross income was spent to meet the costs imposed by your government.This includes the spending and regulatory burden at the federal,state and local levels.Check out the report at Americans for Tax Reform.

President Obama has blown away the previous record date in 1982 of July 20th by 23 days!Federal spending accounts for 111 days.State and local spending accounts for 49 days.Federal regulations add 42 days and state and local regulations tacked on 23 more.These are all averages from across the country.

In Michigan,we fell from 20th in 2008 to 28th in 2009.Our COGD is August 7th meaning you worked 219 days to pay for these costs so the good news is we at least beat the national average of August 12th.Hooray!

These are preliminary numbers and will most certainly be revised at a later date.With the health insurance debate underway,cap and trade still pending,the costs of all the Presidents' czars and any other unknowns,you can bank on these dates pushing even further back.More to come...

Wednesday, August 12, 2009

Day 66 jobs update

June 8th was the Obama proclamation of 600,000 new jobs this summer over 100 days.We are now 2/3 of the way thru.Do you see 396,000 new jobs created since then?Of course you don't because he meant that he had saved them,not created them.

Instead,we lost 247,000 more jobs in July.We were told that this is good news because the official rate dropped from 9.5% to 9.4%.My previous post discusses why this is a fallacy.

Let's not forget that unemployment benefits have been extended twice and are awaiting a 3rd extension.If it doesn't happen 500,000 more people will drop off the rolls as the first wave of extensions expires in September.It will be 1.5 million more by the end of the year as the second wave expires.

We must pay attention to this closely as it will skew the numbers.422,000 dropped off in July for various reasons but regardless are not counted.So pay attention to the actual number EMPLOYED,not unemployed.This number showed a 155,000 drop from June which makes the drop in the official rate meaningless.Obama does not want the official unemployment number to top 10% as this is a symbolic threshold,unless he needs the fear factor for another stimulus or TARP expansion.It doesn't seem likely he would go this route as he has proclaimed the economy his now,so another dip would be blamed on his policies.But only he knows the master plan,we can all only speculate.More to come...

Monday, August 10, 2009

Unemployment decreased?Or did it really?

So,the unemployment rate has dipped for July.Sounds like a good thing on the surface,but let's take a closer look at the numbers.There were 267,000 less Americans reporting unemployed in July and this accounts for the dip from 9.5% to 9.4%.But the way I see it,that's not the key number that matters.The number of EMPLOYED Americans dropped 155,000 in July.422,000 Americans dropped from the workforce meaning they aren't counted as employed or unemployed.They ran out of benefits or just stopped looking for employment officially.

This is why the official unemployment number is skewed.It also doesn't account for marginally attached workers which would raise the number to over 16%.All of these variables allow for one to twist the numbers for their convenience depending on what their after.Obama is of course no different than any other President and will take any positive at all and promote it.But the fact remains that 155,000 more people aren't employed after July than were in June and that's not a dip in my book.More to come...

Sunday, August 9, 2009

Don't drink the kool-aid

We have now begun the next stage of the crisis-the consumer confidence crisis.Why,you may ask?Because over confidence in what is happening today will help escalate the crisis to come.The White House will continue to step up the green shoots reporting as the economic numbers have appeared to stabilize.Unemployment has dipped.GDP is now nearly flat.Housing sales have increased.The Dow is climbing rapidly at an unwarranted pace.The cash for clunkers bill has been a boon.Obama will certainly promote each one of these as a result of his policies at work.The likely result will be consumer confidence rising as most people want to believe in Obama and that his policies are working.

This is a huge problem because consumers will revert back to the habits which helped inflate the various bubbles.The housing bubble is well known.The bubbles to come such as commercial real estate,unsecured credit,the price of oil,and the granddaddy of them all-the debt bubble won't be overcome by TARP or stimulus or the Fed manipulating interest rates.Nobody wants to hear gloom and doom predictions,but the evidence is out there and you don't need to be an economist to decipher it.

The inspector general for TARP,Neil Barofsky,has reported in July that we have $23.7 trillion in debt exposure meaning if all our liabilities were maxed out,that's what taxpayers would be on the hook for.Our entire GDP for 2008 was only $14.2 trillion meaning the total output of all goods and services produced in the US.The entire personal gross income for 2007 was only $8.8 trillion so even if we paid 100% of our income in Federal taxes we couldn't meet the debt obligations that Obama has committed us to.Taxing the rich isn't going to save anybody.

We may not find out the total extent of our debt until Ron Paul's audit the Fed bill passes if Congress is even able to obtain what it wants.In the meantime,we'll be caught up in healthcare reform,which is really health insurance reform,cap and trade,immigration reform and all the other items on the Obama agenda.

I encourage all to do your research and you will see these claims are warranted and not fear mongering as the left would have you believe.All of the actions taken so far will only have the effect of delaying the inevitable.There simply is no alternative other than to flush out the toxic garbage from the system.Shifting obligations is only a band-aid to buy time.Besides,all of those who are warning of what's to come are only asking you to protect yourself and your investments.Being cautious won't cause you any harm but will pay huge dividends later.More to come...

Thursday, August 6, 2009

Conyers hard at work

The Detroit News is reporting on the voting records of our elected officials.What a shock to find out Rep. John Conyers missed 86 votes.That ranks him 14th out of 435 House members.So,he obviously is a very busy man,right?I mean,it takes alot of time to read all these bills before he votes.Oh wait,he laughed and joked about reading the bills so it can't be that.

Maybe he doesn't fell he's compensated fairly enough to actually read bills and show up to cast votes.His salary is over $170,000 annually and he also receives a plethora of benefits,travel privileges,expense accounts,lobbyist perks,etc. so I don't think it's that.

Maybe he doesn't have the staff to handle the workload.In 2007 according to Legistorm,he had 43 staffers with an annual salary of just under $1 million dollars.And they aren't wasting time reading bills.

I have to wonder if he and his staff have been busy working on defending his wife Monica in all her legal problems.I do know if I had an employee who was absent 13% of the time,they would quickly become a former employee.More to come...

Tuesday, August 4, 2009

Economics for people unqualified to be a dummy

I've been busy in the local newsrag discussing the merits of the stimulus.It simply amazes me how few people understand even basic economic concepts.I can see how being clouded by their love affair with Obama would affect their judgment.But wouldn't you think that at some point even the most jaded would have a glimmer of common sense?

I believe it comes down to one simple question to ponder.Who do you want to control your income?High taxation puts the control in the hands of the Government.Low taxation gives it to you.It really is that simple.

Let's compare the two thru the path of a dollar.When I spend a dollar at a store,I usually pay a sales tax.The storekeeper gets the dollar and pays their distributor for their goods.They then pay the manufacturer or grower or something along those lines depending on what good or service we are talking about.At every step of the way,taxes are collected thru various means to it's conclusion in the process of delivering a good or service to a consumer.

The alternative is high taxation in which the Government takes it off the top and is then charged with it's redistribution thru the vast myriad of spending and entitlement programs.You have succeeded in bypassing all of the steps in-between where different companies make profits and also pay taxes.The consumer has less buying power and their standard of living is lower.

One path allows the consumer to acquire goods or services and various companies to succeed and profit allowing increased employment.The high taxation route eliminates that.Seems like an obvious choice except that the X factor is power and the Government demands it so that they make the decisions on where the money goes.

In short,when we control our money,the Government has less power.What the Liberals don't seem to grasp is that the Government will still receive the same tax revenue at the end of the day.When you reduce tax rates,tax revenue actually increases.This has been proven throughout history.Reagan proved it.The failure was in reining in Government spending from those increased revenues.

Any stimulus program or bailout or other entitlement program run by the Government costs the taxpayers money.No debate here.The Government has no money.Zero.Their funding is mainly thru taxation.Or printing money.Or selling debt.Whatever it is,it all costs us money.

Why does this not make it clear to any rational thinking person?Cutting taxes to put money in the consumers hands which they will then utilize to start the chain of profits and taxes collected results in increased Government revenue because of total tax receipts even at a lower rate.Deficit spending thru stimulus and bailouts does the opposite and thus is doomed to fail right from the start.Yes,you may see a small short term bump like we are experiencing now but the no free lunch rule applies and the bill we must eventually pay destroys the recovery.

It's obvious which path our politicians prefer as they want to have the power and control.But why do so few voters see these simple concepts?This is the challenge for clear thinkers,to educate the unwashed.More to come...

Saturday, August 1, 2009

$3,500 clunker credit is worth $28?

The cash for clunkers auto bailout/climate change plan is booming.Certainly the members of Congress will continue to "find" billions to extend it as they can't pass up the good PR.

The good part?It's certainly generating traffic and sales for the car dealers.It also will save fuel with the mpg savings,CO2 emissions with the newer vehicles,and put safer cars on the road.

The bad part?Once again,just as the housing bubble was created by enticing people to buy more expensive homes than they can afford,we are now encouraging people to take on a car payment with a new car bought on credit.In most cases,they were probably driving a paid for vehicle,likely with reduced insurance premiums.Now it's another bill,a car payment and full coverage insurance.

Of course,these still functional vehicles are now being destroyed which removes cheaper,used vehicle options for people who can't afford a new car.

The recyclers are taking a hit because the engine is the most valuable part of a salvage auto and is being made unusable.This part I love.The process to seize the engine and kill it is by draining the oil and refilling it with a sodium silicate solution.This is the same stuff used to plug radiator leaks.The beauty of it?To make sodium silicate,you combine sodium carbonate with silicon dioxide which creates sodium silicate and CARBON DIOXIDE!Yes,a byproduct of the mixing process is the same greenhouse gas we are trying to reduce.Look it up yourself.

The EPA estimates that the average passenger car produces 11,450 lbs. of carbon dioxide emissions annually.The cash for clunkers program is issuing the dealer a credit of $3,500 for a 4 mpg increase as one option.With a 18 mpg or less trade-in requirement,this is roughly a 22.25% increase in mileage for this example.Each 1 mpg increase results in a 1% decrease in carbon emissions.So,the 4 mpg increase was 22.25%,or 2,547 lbs. of the annual 11,450 lbs. emitted.A metric tonne weighs 2,204 lbs. so the 4 mpg increase saved us just over 1 ton of carbon emissions.According to the CBO report on cap and trade,a carbon offset credit equal to 1 metric ton of emissions should be worth approx. $28 in 2020.For our 4 mpg increase in mileage,the taxpayers are paying $3,500 for a credit worth $28.Now that sounds like Government at work.Sure there are variables and other factors.Producing a new vehicle and recycling the clunker as well as the sodium silicate solution results in an increase in carbon dioxide emissions.The increased mpg results in less fuel consumption which translates to a decrease in carbon emissions.The X factor is miles driven by the consumer and that will obviously vary.

Does the ends justify the means?I report,you decide.More to come...