Friday, October 30, 2009

Freddy Kruger has nothing on the Fed,it's really evil!

The U.S. dollar has lost 95% of its value since the Federal Reserve was created in 1913.Do you know what that really means?I would wager a 1913 dollar that most people don't have a clue.It means due to inflation,we've had a 2,111 percent increase in prices in 96 years.A $10 suit in 1913 costs $211 today.These are consumer price index figures tracked by our Government,so this is fact,not opinion.It translates into a 95% loss in wealth,or purchasing power.

I mention the Federal Reserve because this is the demon that is responsible for nearly all of our economic problems today.I know the argument is centered on Obama and his agenda,or Bush if you hate Republicans,but a far greater threat to our way of life is the destruction of the dollar.Do yourself a favor and read Ron Pauls 'End the Fed'.He explains it clearly and concisely.The Fed was supposed to stop this boom and bust cycle our economy goes thru.The recession that just ended was number 18 since the Fed was created.Nice track record.

The only reason we have inflation is the Fed and it's policies.Period.They artificially manipulate interest rates and the money supply to attempt to control the markets.Today we hear we need liquidity to halt the credit crisis.That we need bailout funds for companies too large to fail.Stimulus money to jumpstart the economy.To raise the funds to do these things,we can raise taxes or sell debt to foreign entities or print money.Government is doing all 3.And when none of these are equaled out,or backed up by increased goods and services,you have inflation.We have more money than the equivalent goods and services which makes the price go up to buy the same amount.The end result is the $10 suit now costing $211.Just imagine that.Without inflation all these years,that's how far your dollar would go.We are so accustomed to seeing prices rise over time,we just accept it as fact without realizing there is no reason for it other than the Fed manipulating our money.

The Fed can create money out of thin air whenever it desires.It's usually done in a computer database rather than actually printing it,but it still counts the same.Whether it's Federal or State,our politicians are budgeting the same way by spending money they don't have.Like they have a money tree.Except eventually the green money leaves turn brown and fall to the ground and get turned into mulch.Nobody knows if we will eventually default on our debt or more likely simply devalue the dollar massively.That's when you get the Zimbabwe economy where everyone is a millionaire except that their dollars are virtually worthless and can't buy much.

Our political parties in power change and we go back and forth changing social policies accordingly.The loss of our wealth from the Fed is like a cancer that keeps growing and really will eventually destroy our way of life if we don't stop it.If you don't believe it,unfortunately,when you are forced to accept it,it will be too late to stop it.It's not a Democrat or Republican issue.Everyone will lose.Do your own research and decide for yourself if you can afford to simply sit back and do nothing.More to come...

Did the stimulus stop the recession?

The POTUS sure is touchy,isn't he?Momma apparently didn't instill much of a backbone in him because he can't take a lick of criticism.He has his attack dogs going around the clock attempting to discredit anyone not supporting his policies.

Today we got a GDP rate of 3.5% for 20093Q meaning the recession has ended.Obama wants his stimulus to get the credit for this and we hear opposing arguments against it.I say chill out,my man,you can have the credit.And the blame.And that's the problem.

As time goes along,we will hear more about the GDP in greater detail and learn more specifics on what entailed it to rise.Normally,it's good news that the GDP rose 3.5%.The average increase is around 3% per quarter,so this exceeds average.However,the devil is in the details.

Cash for clunkers.1st time homebuyer credit.Refilling of inventories.These are the main reasons.The clunker program is over.The inventories have been restored to the new lower levels.The homebuyer credit will live on and be expanded to include existing homeowners.This one may last awhile because it's popular with the public.

This is why we will see the double dip next year.Band-aid approaches to economics.Just as the stock market rises on earnings reports that reflect downsized companies.There is the correction phase and then it's gone.States that are balancing budgets with federal stimulus money.Gone next year.

Unemployment extensions will end at some point.Interest rates must rise to check inflation.Prices will rise as cap and tax costs will be passed on to consumers.Prices will rise as health care costs are paid for by higher taxes.Commodities prices will continue to rise as the dollar slowly continues it's decline.Consumer buying power will continue to fall for all the above reasons as well as overall wage decreases.The VAT tax is yet to come.Unemployment will stagnate.Home prices will stay depressed.On and on and on.

So Obama can take credit today,but his bill hasn't come due yet and he won't be able to blame that on Bush once he's taken credit for saving the economy.If it dips again,and it surely will,it's all on him.More to come...

Sunday, October 25, 2009

Will abortion funding kill health bill instead?

It seems somewhat ironic that abortion funding may be the pivotal issue that denies the healthcare reform bill to come to the floor of the House,but it may just do that.The bill itself is certain to be an abortion.Everyone is focused on the public option and this may be the way to bring down this mistake of unimaginable size.

I would suggest that this should be one of those times when Republicans need to reach out to their Democrat representatives and urge them to follow thru.Bart Stupak is a Democrat,however,he heads the coalition of 40 Democrats that say they will vote to kill the bill by preventing it from even coming to the floor.This will,of course,enrage Pelosi as she has already insured that each version of the bill being considered contains federal abortion funding.Here is the link to the story.

Please contact these members and relay your support.More to come...

Wednesday, October 21, 2009

Michigan-home of unemployed scholars

Granholm was chomping at the bit to exercise her line item veto and has been demanding the Senate send her the budget bills so she could get right to it.Her highest priority?Cutting education.Her number one criticism?Dis-investment in education.Can we put this in Wikipedia to replace the current definition of hypocrite?

She will now be speaking to anyone that will listen that we must invest in our childrens future to promote her tax increases.You know,Promise scholarships and Hope grants and all education based incentives are great things.Who can argue against them?When it comes to spending our tax dollars,education is acceptable to virtually all.The problems arise when we attempt to demand efficiency and transparency and not simply turning the checkbook over to the NEA and the long line of benefactors who suckle at the public trough.

The fact of the matter is that we must address our economy right now.With unemployment still rising and tax revenues decreasing,it takes precedence over all.If we don't what future will our children have?We'll have the most highly educated group of unemployed people on the globe!Yes,lot's of really smart unemployed people with degrees in hand.

We have a massive list of issues in this state that are very important to it's residents.Maybe it's the roads or water quality or tree disease or asian carp or crime or whatever is important to you.They are all important to someone.But we all must live with-in our means and the state budget is not exempt.

We see the same problem nationally with Obama focused on his climate tax and health care tax and more.They use times of economic distress to push thru social agenda issues as some sort of solution because they can't get the broad support they need when times are good and we have more options on how to spend tax revenue.

Jobs must be our total focus.We've been in a depression for 8 years under Granholm.The MEDC,the MEGA,the single business tax,Hollywood tax credits.The list of failures and bad policy go on and on.Michigan Republicans need to do a full court press in the next 10 days to show how Granholm is playing politics with the budget and make sure the residents fully understand why their version of the budget will work and is fiscally responsible.More to come...

Monday, October 19, 2009

15 MI banks on the FDIC watch list

The FDIC has stepped in and taken over 99 banks now this year.There were 416 banks on the FDIC risk list as of June.The majority of these have had a cease and desist order served upon them by regulators,or some type of formal warning,due to unsafe or unsound banking practices.The blog 'calculated risk' has tracked even more at 479 to date using publicly available information.There are 15 such banks in Michigan on this list.

24199 242,496 N OCC Capitol National Bank Lansing MI 1/30/2009 Formal Agreement General
30005 1,922,750 SB FDIC Citizens First Savings Bank Port Huron MI Cease & Desist
34597 233,701 NM FDIC Clarkston State Bank Clarkston MI 6/16/2008 Cease & Desist General
14370 361,511 N OCC First National Bank in Howell Howell MI 9/24/2009 Cease & Desist CRE lending
30329 13,918 SL OTS Home Federal Savings Bank Detroit MI 10/9/2007 Cease & Desist (Temporary) Operations Yes 3/5/2009
28136 112,779 SA OTS Mainstreet Savings Bank, FSB Hastings MI 5/29/2009 Cease & Desist General
33134 1,212,760 NM FDIC Michigan Commerce Bank Ann Arbor MI 4/20/2009 Written Agreement General
35586 123,258 NM FDIC New Liberty Bank Plymouth MI 6/17/2009 Cease & Desist CRE lending
34953 274,868 NM FDIC Northpointe Bank Grand Rapids MI 10/1/2008 Cease & Desist General
9719 366,222 NM FDIC Oxford Bank Oxford MI 5/15/2008 Cease & Desist General
34673 277,141 SM FRB Paramount Bank Farmington Hills MI 11/6/2008 Cease & Desist General
34127 121,138 NM FDIC Select Bank Grand Rapids MI 8/28/2008 Cease & Desist General
32232 750,881 SA OTS Sterling Bank and Trust, FSB Southfield MI 8/4/2009 Cease & Desist General
14587 148,701 NM FDIC University Bank Ann Arbor MI 2/12/2009 Cease & Desist General
22308 163,445 MI FDIC West Michigan Community Bank Hudsonville MI 2/19/2009 Cease & Desist General

The 5 digit number is the FDIC certification number.The 2nd number is their assets in thousands.Remember,this is an unofficial list,however,it's based on published information.More to come...

Wednesday, October 14, 2009

15.3%,or is it more?

It's that time of the month again.The monthly state unemployment number has been released for September.It's 15.3%.I would imagine that Granholm will spin it as "only" rising a tenth.But did it really?

Take a look at the numbers and you'll find 740,000 unemployed in Michigan compared to 736,000 in August.Yet the labor force dropped 10,000 from 4,845,000 to 4,835,000.The number of "employed" people actually dropped by 14,000 from 4,109,000 to 4,095,000.Play with the calculator and you can see that it's only because there are less people counted in the workforce that the rate didn't rise higher.

It's the same scenario on the national level.At least they release the alternative measures tables which take into account marginally attached workers.But 4,000 more unemployed in Michigan sounds better than 14,000 less employed.These people have disappeared into thin air for one reason or another and aren't counted any longer.

I do know this.According to the DELEG numbers,we have 384,000 less people EMPLOYED from just one year ago.That's an 8.6% drop in just one year.I don't think you'll see Jenny promoting that number proudly.More to come...

Monday, October 12, 2009

Obama's Nobel sham exposed

The debate about the validity of Barack Obama being awarded the 2009 Nobel peace prize is centered around whether or not it was a rebuke of Bush or an endorsement of his goal of a nuclear free world.As per usual with politics,they're trying to make us look in the wrong direction.

Alfred Nobel left explicit instructions in his will written on Nov.27,1895.Here is a quote directly from his will.

The whole of my remaining realizable estate shall be dealt with in the following way: the capital, invested in safe securities by my executors, shall constitute a fund, the interest on which shall be annually distributed in the form of prizes to those who, during the preceding year, shall have conferred the greatest benefit on mankind.

Notice it states the award is based on events based on the "preceding" year.The Nobel committee sends out invitations in September annually.February 1st is the deadline for submission and can only be submitted by a "qualified nominator".Here is a list of possibilities:members of national assemblies, governments, and international courts of law; university chancellors, professors of social science, history, philosophy, law and theology; leaders of peace research institutes and institutes of foreign affairs; previous Nobel Peace Prize Laureates; board members of organizations that have received the Nobel Peace Prize; present and past members of the Norwegian Nobel Committee; and former advisers of the Norwegian Nobel Institute.

Barack Obama hadn't even taken office yet for this award.Therefore,he must have been nominated for his efforts as a Senator,or if you want to stretch,as the President elect.The nomination is for efforts from the "preceding" year meaning his nomination must be based on his contributions from his campaign for President.Any speeches or meetings or other accomplishments from this year would be ineligible.

It will be 50 years before any details can be released,so we won't know until then who nominated him.I think we can determine today,however,that he certainly accomplished nothing during his campaign worthy of this award.More to come...

Friday, October 9, 2009

Debt problem solved!

Here is the solution to our debt,just sell 'em to the Chinese!

Wednesday, October 7, 2009

Public option-good thing?

As Al Gore loves to say,the debate is over.Will the public option force people to drop their private insurance healthcare?No.Will the public option result in employers dropping their private healthcare plan in favor of the public option?Yes.

The means aren't important,it's the end result.This is similar to the "save or create" strategy of Obama to muddy the waters.Or go furthur back to "what is the meaning of is" in the Clinton era.

Simple economics,nothing complicated.If the government produces a healthcare option that has a cheaper monthly premium,of course people and companies will go to it in droves.The government has no profit motive,no stockholders to answer to,in short no reason to compete on a level playing surface.So yes,the private healthcare industry will be destroyed as is the goal.

If this public option is so good,why not expand it into other areas?How about baseball?If we had a publicly owned team,salaries,trades and seat prices could be drastically lowered.So,let's have a public option sports team in each of the major sports to artificially lower ticket prices for all.

The sky is the limit here.We could list off any number of industries where we believe prices are too high,or even salaries.In theory,having a government run option in each one would provide the checks and balances to keep everyone honest and lower prices and salaries to the minimum.Do you buy that?

You could argue that's it's unconstitutional for the government to be in business and you'd be right.

You could argue that any government run program has always resulted in higher prices,bloat,corruption,losses and wasting of taxpayer dollars and you'd be right.

You could argue that anytime the government competes with private industry that the free markets suffer and you'd be right.Critics would argue that in some industries such as the USPS is already competing with FedEx and UPS.However,this is not an apples to apples comparison.

The healthcare debate has other factors as well.Politics play a huge role in this debate so it's not just a matter of reducing costs by introducing a cheaper competitor.I suppose the core issue in this argument is the role of the profit motive.

The critics will claim the profit motive is a negative leading to the exhorbitant salaries.Proponents claim the profit motive is what leads to lower prices as companies must compete or be run out of town.Tough to argue that one.If you're priced higher than your competitors,you will fail.Value and quality and service will offset this to a degree,but not without limits.A Rolex is certainly preferred to a Timex,but only to a certain price point.

The problem is allowing an option in which the competitor has virtually unlimited resources and doesn't have to make a profit.This is the government,of course,and a normal business can't compete with that.It's like going to Vegas with the guarantee of having your losses re-imbursed no matter what.Who wouldn't spend foolishly?

So,the debate is over on the merits.The public option is purely a political issue and anti-business.Still not convinced the public option is a good thing?What if we did a similar thing with education?Aren't cost too high?Let's put out teaching positions to the lowest salaries.Wouldn't some people be willing to teach for much less than what our current teachers make?Sure,they would.But would you sacrifice your quality of education to save money?

Need more?How about your water bill?Seems awfully high for what falls from the sky for free.Why not put that out for lower bids?Would you have any concerns about safety or the quality of the water if companies were forced to lower prices to compete with a competitor that has no worries of making a profit?

The only way the free market works is if all of the competitors play on a level playing field.Take a closer look at Tort reform,restrictions on purchasing insurance across state lines and other artificial price hikes if you want to lower costs.Separate the market issues from the politics and you'll get your wish.More to come...

Tuesday, October 6, 2009

Had your CPS survey lately?

The CPS,or current population survey,is the tool used by the Bureau of Labor Statistics to determine the monthly national unemployment rate.It's a telephone survey of approximately 60,000 households.This has been done since the 1940's and has been modified many times over the years.

The survey is based on a sample process that breaks down households from larger metropolitan areas down to blocks of 4 households.They conduct the telephone interviews for 4 consecutive months,off for 8 months,and then it's repeated.The idea is survey 50% of the households with-in a 2 year period.It's usually conducted during the week of the month with the 12th day in it.

There are about 1,500 employees that conduct these surveys using publicly available address databases and other sources such as building permits.There are approx. 115 million households in the U.S. and surveying 60,000 is only about .05%.There are about 154 million in the labor force with another 80 million meeting the age minimum of 15 years old who aren't in the labor force for various reasons.

Here's my problem.I'm 44 years old and been a homeowner for 20 years.I've never been contacted for this survey.I took a survey of my own and found that no one I know has ever been surveyed either.I wonder about those of you out there.Do you find similar results?

For those that pay attention to these numbers,many feel they are artificially low.The BLS does publish it's alternative measure tables and more people are paying attention to the U-6 measure which includes marginally attached workers to get a more accurate sense of the true unemployment rate.

As we see the reports of new claims filed each week exceeding half a million,these numbers bear more scrutiny.The only reason the official rate hasn't exceeded 10% yet is the large amount of people who drop out by not actively seeking work in the prior 4 week period.

It's interesting to go the BLS website and review the scenarios in which people are considered as employed.An example would be the wife of a small business owner who works at least 15 hours a week even if it's unpaid.She is counted as employed.Not to mention,these are merely telephone interviews in which the results are based on the homeowner responses.It's a relatively small sampling of the labor force and at least in my case,I don't know anyone ever interviewed.How accurate can this be?

During the Clinton era,the sampling number was dropped to 50,000 households and inner-city sampling was strictly limited.Yet magically,after he left office the number was restored to 60,000.Coincidence I'm sure.

We hear everyday that the stimulus is working,jobs are being saved,the stock market is soaring,etc.When you look between the lines and study other data,it doesn't support much optimism.So,I would suggest taking these "official" numbers with a grain of salt.More to come...

Sunday, October 4, 2009

Warren Bank obituary

It's the usual weekend-miss the news cycle-bank takeover announcements and this time around they hit home turf.Warren Bank has fallen victim to their bad investments and now the taxpayers are on the hook for $275 million to bail them out.They will now become Huntington National Bank.

Lots of smiles around to see Obama finally take one right on the jaw.And Oprah to boot?I'm not sure how he's going to blame this on Bush.One thing is for sure.This is his first rodeo and he won't see an 8 count.I wonder what else he'll find time for to deflect attention?I hear the Loyal Order of Water Buffaloes are having a fundraiser.Maybe Fred and Barney would even shoot 18 with Obama.

Poor Michael Moore.He hates capitalism.His new film gives him reason why as he failed at it.With a $1.5 million opening night,he was nearly $8 million behind "zombieland" and more than doubled by the sure to be classic "cloudy with a chance of meatballs".Is he donating those evil profits to a worthy cause?

How fitting that our state budget fiasco will play out on Halloween.Will they all don costumes for the fright show?Maybe hand out iou's instead of candy?I hope to see Jenny take her position overseeing all from inside the Great Pumpkin.More to come...

Friday, October 2, 2009

Tell us how you really feel

Let's see,Joe Wilson speaks up and he's rebuked.Alan Grayson speaks up and Nancy Pelosi says we should all apologize.Huh?

I do know this.Since Joe Wilson spoke up,he's taken in over $2 million in contributions.If I were him I would make the following statement.


I mean,if speaking the truth got him over $2 million,just think what a good,full blown curse out would fetch!More to come...

2-5-2010 Why?

This is the date on which the Labor Dept. will make a slight correction of the benchmark they use when determining the unemployment number.Current projections indicate there may have been 824,000 more jobs lost than were reported.Oops!Here is the text from the bureau.

Preliminary Estimates of Benchmark Revisions to the Establishment Survey

In accordance with usual practice, the U.S. Bureau of Labor Statistics
is announcing its preliminary estimates of the upcoming annual benchmark
revision to the establishment survey employment series. The final bench-
mark revision will be issued on February 5, 2010, with the publication
of the January 2010 Employment Situation news release.

Each year, the Current Employment Statistics (CES) survey employment
estimates are benchmarked to comprehensive counts of employment for the
month of March. These counts are derived from state unemployment insur-
ance tax records that nearly all employers are required to file. For
national CES employment series, the annual benchmark revisions over the
last 10 years have averaged plus or minus two-tenths of one percent of
total nonfarm employment. The preliminary estimate of the benchmark
revision indicates a downward adjustment to March 2009 total nonfarm
employment of 824,000 (0.6 percent).

Here are the month by month blows since the Obama regime took over.And remember,it was just Sept. 24th when Joe Biden stated to the nations Governors that the success of the stimulus exceeded his wildest imagination.

Mar: 652,000
Apr: 519,000
May: 303,000
June: 463,000
July: 304,000
Aug: 201,000 (preliminary)
Sept: 263,000 (preliminary)
Total: 2,705,000

Thank God for the 1 million jobs Obama claimed his stimulus has saved.More to come...

Thursday, October 1, 2009

Shut Down '09!

No time warp back to 2007.It's the 2009 version with the same players fighting the same battles only even more fiercely divided.No lessons learned from 2007.They did manage to cut the shutdown in half this time from 4 hours to 2 before Granholm signed the 30 day extension.She also lied on her threat to layoff all non-essential state employees if she wasn't sent a balanced budget.Anyone surprised?

Perhaps this will be comparable to the U.S. Congress taking their August recess in the midst of the healthcare debate.Maybe our lawmakers should hold a few contentious townhalls in this 30 day reprieve and find out the mood of the taxpayers before they decide to raise taxes to balance the budget.

Our state has been in a depression longer than any other.Raising taxes to attempt to keep the status quo is folly with our bleak economy.Yet Granholm will still pay off her cronies with MSP-HQ debacle.I would absolutely love to buy a nicer house with home values so depressed,but my budget tells me to stay put.So I live with-in that budget and only make necessary purchases.

Will the cuts be painful?Sure for the thousands that have come to depend on government to be their primary provider.But when revenues are down,spending must follow suit.My job pays partial commission and has dropped accordingly with the economy.Should I use my credit card to maintain the same standard of living?Of course not,not if I don't want to simply delay the pain of having to cut back.Not to mention that delay in buying time charges interest.

The Promise scholarship program is great if you can afford it.Perhaps we should use that funding to send the Michigan legislature and our Governor to a few classes on fiscal responsibility.More to come...