Showing posts with label Economy. Show all posts
Showing posts with label Economy. Show all posts

Saturday, May 07, 2011

Flashback: 'Obama White House ordered coverup of religious symbols for Georgetown speech'

The Democrat blogosphere and media complex spent much of the day yesterday blistering conservatives -- me included -- for misconstruing a Jake Tapper tweet. Tapper's breathless message from Ground Zero -- and the site of President Obama's first-ever visit to the World Trade Center memorial -- read "One minute to air and they decided to take the flag down from the live shot!"

I made the mistaken assumption that the President, often concerned with symbolism over substance, had decided to remove the flag from the background to avoid "spiking the football" (as Michelle Malkin put it). But that wasn't the case: apparently Tapper's hysteria was precipitated by a scheduled removal of the flag an hour after Obama had left the scene.

So the conclusion to which I jumped was provably wrong -- but, given Barack Obama's history, not out of character.

In April of 2009, the Los Angeles Times reported that the "Obama White House ordered [the] coverup of religious symbols for [the president's] Georgetown speech":

Surprising word today that President Barack Obama's White House asked Georgetown University to cover all religious symbols at the scene of the president's economic speech at the Roman Catholic institution Wednesday.

And the prestigious Jesuit university agreed... The Democratic White House explained the move as a desire to keep the backdrop for presidential speeches consistent and not distracting to the audience. The president, who has yet to select a local parish for his family in Washington, has described his religion as "Christian."

That's not all.

Obama's controversial decision to remove his U.S. flag pin during the 2008 campaign must have proven decidedly unpopular in David Axelrod's polls. He soon restored the American flag pin to his lapel.

Furthermore, President Obama, Senate Majority Leader Harry Reid, and other Democrats have conspicuously redacted the word "God" from the Declaration of Independence and the Pledge Of Allegiance.

It's happened several times. It's not a coincidence.

Our founding document -- the Declaration -- enunciates immutable, God-given rights. But Democrats believe that only government can grant rights (e.g., the "right" to free health care).

In order to successfully prosecute their agenda, Obama and his sycophants have no choice but to supplant God with government. Sound crazy? I welcome other explanations for these uncanny "coincidences".

Given these incidents as background, it's no wonder many of us miscontrued Tapper's tweet. The conclusion we jumped to was entirely plausible.


Thursday, May 05, 2011

Chart o' the Day: Progressive Income Taxes are Regressive

Vice President Joe Biden once said that we all "have to have skin in the game". Apparently he wasn't talking about Democrats.

Consider the following chart from JP Morgan Funds, which illustrates the disastrous policies of "progressive" income taxes.

The top 10% of taxpayers are paying increasingly larger shares of the federal tax burden. Conversely, the bottom 10% are paying less than ever.

And the amount of revenues collected by the feds continues to decrease.

How's that 'tax the rich' strategy working out, Sparky?


Source: JP Morgan Funds.

Wednesday, May 04, 2011

Democrat Incompetence Not So Funny In Illinois Where Vendors Are Begging the State to Borrow More So It Can Pay 9-Month Old Invoices

If Democrats weren't in power, they'd be useful only as comic relief. Their failed entitlement programs, their locust-like destruction of economies big and small, their misery-inducing wealth redistribution schemes... everything they touch turns to fecal matter. Which makes Illinois an especially interesting laboratory.

Resource One Office Furnishings and Design was Illinois’ largest metal office furniture supplier in 2000, and the company attracted the state itself, which wanted the company to design and make custom-made office furniture for state agencies.

But when the economy tanked in 2009, so did [the] furniture business. And that same year, the state started falling behind on its payments to its vendors... In 2010, the state owed Resource One about $500,000 and payments were at least nine months past due. To keep the business afloat, Mannschreck and his business partner, Cindy Davis, took out loans from banks.

...How much does Illinois owe? Well, for example, it owes:

* $50 million to St. John’s Hospital
* $25 million to Memorial Medical Center
* $2.1 million to Springfield ARC, an advocacy organization that deals with intellectual and development disabilities

Illinois’ Comptroller Office has more than 200,000 unpaid vouchers dating back to November 2010 totaling $4.2 billion. The unpaid bills are expected to double at $8.3 billion by the end of June...

“That number includes payments due to our small businesses, schools, hospitals, not-for-profit and social service agencies,” Hahn said. “It is unacceptable and needs to change, which is why (the comptroller) continues to push for spending reforms as the only way to regain our fiscal footing.”

...“We think immediate action is needed — small business, health care providers, units of local governments, school districts, universities and others who are owed money by the state should not be expected to be the de facto bank for the state of Illinois,” the chamber's Plummer said. “We support short-term bonding to pay off past-due bills.”

...Service providers, hospitals and businesses are hanging on a financially thread... “We appreciate (the state’s) business, but we don’t have deep pockets and we just have to be paid,” said Mannschreck, the business owner. “If the state doesn’t pay on time, it affects the ability to buy and get products manufactured. Manufacturers also need money. It’s kind of a house of dominos.”

My advice: keep voting Democrat, drones.

Those out-of-control public sector union bosses can really use the extra money. The private sector lives to support government; that's what Democrats believe and that's why you, the citizen, should support higher taxes to make things right for the union bosses.


Is There Really a 'Gold Bubble'? Maybe Not.

Brett Arends, writing at MarketWatch, refutes the notion that gold is in a speculative "bubble". He does so by comparing the current spike in gold prices with other speculative run-ups in recent history.

Gold is in a bubble. Anyone will tell you that. They've been saying it since gold was about, oh, $500 an ounce.

But it's a funny kind of a bubble. It's the only one I've encountered where so few people seem to own the asset in question... During the dot-com bubble, you met lots of people with tech stocks. Taxi drivers told you what dot-coms they owned.

During the housing bubble you met normal, ordinary people who were trading up to expensive homes using adjustable-rate mortgages, buying new condos off plan to flip, and cashing out their fictional "equity" through a refinance mortgage.

But who actually owns gold? I keep hearing about the gold bubble, but every time I ask people if they own any themselves, they say, "no, no, of course not, it's a bubble."

Some bubble...

[The accompanying chart] compares the bull market in gold with the last two undisputed "bubbles," namely tech stocks and housing. It shows the gold price since 2001, the Nasdaq Composite COMP from 1989 to 2001, and Standard & Poor's index of Homebuilding stocks from 1995 to 2007.

The picture is pretty remarkable.

If gold is a "bubble," it doesn't look like it's peaked yet. Indeed it looks like it might be just about to enter its big, blow-off phase.

Gold is a quirky investment, to be sure, and I'm about the last person to advise anyone on anything when it comes to financial matters.

But one thing is certain: the administration's policy of "Quantitative Easing" (or, as I like to call it, "Quantitative Bankrupting of America's Future") has unleashed the Treasury's printing press like nothing ever seen in world history.

Trillions in cash has materialized from thin air as the Treasury Department issues IOUs and the Federal Reserve purchases them on the open market. Which, by the way, enriches Goldman Sachs (and other so-called "primary dealers") with tens of millions of dollars in needless commissions each month.

Until the money-printing stops, until the deficit spending is brought under control, and until the dollar is rescued from the most radical administration in American history, I would hold some precious metals like gold.

It's a hedge against governmental stupidity -- and heaven knows we need it now more than ever.


Sunday, May 01, 2011

Survey: Nation's Unemployed Cheered by President Obama's Comedic Stylings at the White House Correspondents' Dinner

When the going gets tough, the tough 'lead from behind'. In this case, the President invested his time wisely in preparing music videos and a lengthy monologue at the White House Correspondents' dinner.

...And where is the National Public Radio table? (Cheering.) You guys are still here? (Laughter.) That's good. I couldn't remember where we landed on that. (Laughter.) Now, I know you were a little tense when the GOP tried to cut your funding, but personally I was looking forward to new programming like "No Things Considered" -- (laughter) -- or "Wait, Wait...Don't Fund Me." (Laughter.)

Of course, the deficit is a serious issue. That's why Paul Ryan couldn't be here tonight. His budget has no room for laughter. (Laughter.)

...Donald Trump is here tonight! (Laughter and applause.) Now, I know that he's taken some flak lately, but no one is happier, no one is prouder to put this birth certificate matter to rest than the Donald. (Laughter.) And that's because he can finally get back to focusing on the issues that matter -- like, did we fake the moon landing? (Laughter.) What really happened in Roswell? (Laughter.) And where are Biggie and Tupac? (Laughter and applause.)

...You know, in the last months, we've seen journalists threatened, arrested, beaten, attacked, and in some cases even killed simply for doing their best to bring us the story, to give people a voice, and to hold leaders accountable. And through it all, we've seen daring men and women risk their lives for the simple idea that no one should be silenced, and everyone deserves to know the truth.

For a minute there, I thought he was talking about the brave souls at The San Francisco Chronicle.


Linked by: Michelle Malkin. Thanks!

Friday, April 29, 2011

A Trifecta of Central Planning Headlines: GM Edition

And the hits just keep on coming for GM. Please consider the following evidence that central planning works (if you're a Marxist ideologue):

Forbes Gives You 2011 List Of Worst Cars on the Road

Forbes released the 2011 Worst Cars on the Road list and, shockingly, GM and Chrysler dominate the list.

Chevy Volt not for sale, but available for test drive at local dealers

Interesting strategy: build super-expensive "green cars", but not enough to actually sell any.

Why Are General Motors Shares Stuck in Reverse?

Gee, let me guess: they're funded by the central planners in Washington (with our money), their quality ranks among the worst of all automakers, and they're building cars they can't sell.


Gas Pump Sticky-Note Campaign: Pre-Printed Notes You Can Use!

The 'Gas Pump Sticky Note Campaign' is spreading.

Rather than hand-written notes, I've decided to create a set that you can print.

Here are the first two of the set.


Feel free to post suggestions for different versions. The idea is to use real news stories and data to highlight the radical, destructive and extra-Constitutional policies of the Obama administration.


Linked by: Legal Insurrection. Thanks!

Wednesday, April 27, 2011

Gas Pump Sticky Note Campaign Makes Its Way to Grocery Stores

From YourDaddy, citizen action at its finest.

The Sticky Note Campaign is making deliveries in Georgia Supermarkets now.  Super-Charged with Conservative ideals REAL Americans all over the country and even an awakened Democrat or two are now participating in this grass roots initiative.  Its not a partisan issue either, no one  can afford these rising prices at the gas pump or the grocery store.

I just realized that I need to order more FREE PRE-PRINTED Sticky notes from the Koch Brothers -- gotta go now.





Be sure take pictures of your STICKY NOTES, upload them to your Facebook, TAG all your friends in the pics and then also be sure to share them with the event page.

I like it. It's a simple way to highlight the effects of the Democrats' disastrous deficit spending, their insane drilling policies, and their hatred of all things free market.


Also see: TrendingRight.com - What's Happening on Twitter Right Now!. Linked by: Instapundit. Thanks!

The Atlantic: Donald Chump May Be Dumber Than You Think

"He may be dumber than you think: Exclusive research reveals "Celebrity Apprentice" viewers are the most Democratic in primetime TV"

If Trump's sharp right turn and populist rhetoric were ratings ploys, they were -- like his thrice bankrupt casinos -- monumental failures.

"Celebrity Apprentice" viewers are the most Democratic in primetime TV.

...the audience for "Celebrity Apprentice" is among the most liberal in primetime television (see graphic above). Rather than add viewers, Trump foolishly appears to be driving them away...

Trump's ratings have clearly dropped. The fall-off has been especially pronounced over the last few weeks, a period that coincides with Trump's emphasis on Obama's birth certificate. "Something is definitely going on there," another media buyer told me. "He's dropped -- and that's a big f***ing dip." Given the liberal skew of Trump's viewership, that dip might not be surprising.

The Republicans flirting with Trump ought to remember his history:

• He was pro-choice a few years ago; now he's pro-life
• He donated $50,000 to the malevolent Rahm Emanuel's mayoral campaign
• He also donated to the ludicrous Marxists Chucky "Schmucky" Schumer and Anthony's Weiner in the last election cycle
• Just a few years ago, he wanted George W. Bush impeached
• He's done absolutely nothing to support the Tea Party over the last two years
• And, despite virtually the entire House GOP's support for Paul Ryan's Budget plan, Chump portrays it as 'too extreme'

We don't need P.T. Barnum in the White House. We need a Constitutional conservative -- in the worst way. And Donald Chump ain't it.


Hat tip: Mark Levin.

Get Your Personal Obamacare Opt-Out Waiver Today!

Have I got a deal for you!

From the looks of the roster of opt-outs to whom the White House has given special exemptions to ObamaCare, it appears to be a Who's Who of Groups Too Democrat To Snare.

Pardon me for sounding a bit self-serving and populist but if the buddies of the White House can Opt-Out of ObamaCare – You and I should be able to as well.

In September, Obamacare promoter and Democrat Rep. Ron Wyden applied for a special state waiver from the very federal mandate he advocated for everyone else.

Within a few weeks McDonald's Double Arch got it's own Obamacare waiver after informing federal regulators that it couldn't afford ObamaCare and would have to drop its affordable health insurance plan for nearly 30,000 restaurant workers unless it got a pass.

In early October, the Obama administration announced it had granted waivers not only to McDonald's, but also to several other firms and oh yeah - labor unions—Groups Too Democrat To Snare.

Of Course Obama and Congress are Exempt.

I almost forgot Muslims are also exempt.

...But that wasn't enough back-room dealing -- HHS Secretary Kathleen Sebelius approved an incredible 111 waivers for businesses AND Unions and other providers of health insurance.

Just curious... Which party is the party of big corporations and special interest groups?

According to HHS, waivers depend on "a series of factors including whether or not a premium increase is large or if a significant number of enrollees would lose access to their current plan because the coverage would not be offered in the absence of a waiver."

Ummm...According to the Medicare Actuary – Millions and Millions of Seniors will lose access to their current plan. Does that mean Seniors can Opt Out?

Hey Obama – I want to Opt Out TOO!
Please add my name to the National ObamaCare Opt Out Registry!
The NOOO! List is APPROACHING 1,000,000 STRONG



Hat tip: L.C. Linked by: Ace o' Spades. Thanks!

Tuesday, April 26, 2011

Another Blue State Success Story: Illinois State Workers' Pensions About to Go Bye-Bye

All across the country, state public sector pensions are melting down faster than a Slurpee in one of Al Gore's four cavernous saunas.

That said, when it comes to the worst of the worst, no state beats the People's Utopia of Illinois, political home to one Barack H. Obama. Please consider 'Illinois ranks dead last in funding worker pensions."

For the second year in a row, Illinois ranks dead last when it comes to saving money to pay promised worker pensions -- and the hole is getting worse... According to a new report being issued this morning by the Pew Center on the States, Illinois through fiscal 2009 had set aside just 51% of the $126 billion it will need to pay retired workers their pensions.

...Above and beyond the $62 billion the state needs but doesn't have for pensions is another $44 billion it will need for promised retiree health care, Pew says. Illinois has set aside only .1% of that figure.

Yes, you read that right -- one tenth of one percent.

Normal citizens are forced to pay 7% or more into Social Security and their benefits are capped at about $30,000 annually. If they're lucky, they'll collect on most of that and some kind of very limited Medicare benefits, thanks to Obamacare's disastrous effects on seniors.

On the other hand, Illinois has thousands of retirees guaranteed six-figure salaries in retirement. 4,352 to be exact, a 20% increase over 2009. And the state's "new, improved" system limits payouts to "only" $86,000-a-year or roughly three times that of the typical private sector worker on Social Security.

The inmates truly are running the asylum in Illinois ("inmates" is a nice term for progressives).


Superb: President Obama unilaterally overrides Congress to permit unchecked Mexican trucks carrying heaven knows what into the U.S.

Legendary patriot Phyllis Schlafly alerts us to a particularly nefarious partnership between Barack Obama and the failed narco-terror state on our southern border.

Barack Obama's deal with the president of Mexico to allow Mexican trucks to carry their loads onto U.S. highways and roads is new evidence of his high-handed solo behavior that has become Standard Operating Procedure in the administration...

1. Obama's deal with President Felipe Calderon, announced on March 3, bypasses Congress, defies the wishes of the American people and looks like the action of a Third World dictator who thinks representative government is a nuisance and can be ignored. Congress made its wishes emphatically clear in 2007 when it voted to continue our ban on Mexican trucks. The House roll-call vote was 411 to 3, and the Senate's was 75 to 23.

2. Obama's deal is a direct attack on the jobs available to U.S. truck drivers because it helps big-business interests cut their costs by hiring cheaper Mexican drivers. Obama's deal is also an attack on small business (i.e., the owner-operated and independent truck drivers) who constitute the [vast] majority of U.S. trucks.

3. The claim that Obama's deal is reciprocal (i.e., U.S. trucks will be allowed to drive into Mexico) is so cynical that we can hardly believe anyone says it with a straight face. "South of the border down Mexico way" (in the words of the old popular song) is the most dangerous war zone in the world (more dangerous than Afghanistan or Libya), where U.S. truck drivers would become the targets of hijackings, theft, murder, kidnappings and even beheadings committed by the drug cartels.

4. Built into the Obama deal is the sneaky imposition of costs on both U.S. truck drivers and U.S. taxpayers. Each truck will be required to install an EOBR (electronic on-board recorder) costing $3,000 plus maintenance fees: U.S. drivers at their own expense and Mexican trucks as a gift from U.S. taxpayers paid out of the Highway Trust Fund. U.S. taxpayers are already paying $1,600 each for many Mexican trucks to replace their old mufflers with catalytic converters.

5. Obama's deal will make it easy for Mexican trucks to bring in loads of illegal aliens and illegal drugs. Border inspection will be a farce, maybe only one in 10 trucks inspected, perhaps merely one in 20.

Phyllis, dear, "illegal aliens" is so non-P.C. Liberals prefer the term "undocumented Democrats".

And then there's this: the EPA will use your money to equip Mexican trucks with anti-pollution equipment, since they're so freaking dirty.

Funny, we never hear how Mexico has to cap its carbon emissions.

Only us.

This administration must be politically eradicated in 2012 if this Republic is to survive. And there is zero percent snark in that previous sentence.


Catastrophe: State pension systems $1.26T in the red -- up 26% in one year

I suspect that the members of America's public sector unions will be nonplussed to discover that their platinum-plated benefits have all the likelihood of surviving as Tyrannosaurus Rex. Pew Research reports that these pensions, by and large, are headed right into the tarmac.

States are $1.26 trillion in the hole when it comes to their pension and retiree health obligations, according to a report released Tuesday...

...And taxpayers are ultimately on the hook for this shortfall, which soared 26% in one year...

...States are largely responsible for this predicament. As tax revenues plummeted, many skipped part or all of their annual retiree benefits contributions as they struggled to pay for education, Medicaid and other services.

States only contributed a total of 64% of the nearly $115 billion their actuaries recommended they put in their pension funds for that year, the center said. They now face a $660 billion gap in these accounts... Meanwhile states socked away a mere 36% of the recommended $47 billion in funding for their retiree health and other benefits. Even more concerning -- 19 states have saved nothing for these obligations, instead of paying the costs as they are incurred, the Pew Center said...

A commenter observes that ""Pennsylvania retired teachers receive 80% of their working salary and some receive free health care insurance for life. And, a 35 year 'pension/career' in teaching is the equivalent of about 28 years on the job in the private sector... There's not one company in the private sector, none, that allows you to retire with that exorbitant package - not one. No wonder states are flat broke. We're approaching the tipping point."

Approaching? I think we're well past it, folks. And to minimize the economic damage, we've got to contain the Statists and begin rolling back their insane fiscal policies.


Monday, April 25, 2011

EPA again blocks Shell from drilling on leases it bought from the federal government for billions, which should do wonders for gas prices

For those of you drones out there who still think, naively, that President Obama is trying to help out the little guy, may I present the following chart?

This is the average, retail national price of a gallon of gas over the past year.

So, Doug, you say -- the price of gas isn't President Obama's fault. It's the speculators. And the oil companies. And Sarah Palin.

Au contraire, mon frere.

The Environmental Protection Agency -- also known as the flat-Earth, no growth, taxpayer-funded, eco-Marxists (which is the term they prefer, I hear) -- is intentionally killing off domestic energy production. Presumably this makes good on at least one of President Obama's campaign promises -- in this case, that energy prices "will necessarily skyrocket."

Earlier today the EPA blocked Shell Oil's second effort to drill an exploratory well in Alaska’s Chukchi Sea.

As Steve Maley puts it, "We have handed radical environmentalists veto power over domestic development."

In 2008 Shell bought the Chukchi Sea leases from the U.S. for $2 billion and then spent another $2 billion on a "pre-drill exploratory phase." Because of ice cover, even basic exploration tasks are difficult, expensive and limited to certain months of the year.

After three years of investment by Shell, the eco-Marxists at the EPA pulled the rug right out from under the beleaguered oil company for specious, ludicrous reasons ("The EPA’s appeals board ruled that Shell had not taken into consideration emissions from an ice-breaking vessel when calculating overall greenhouse gas emissions from the project").

We are the only country on the face of the Earth that restricts access to its own vast energy resources.

These suicidal policies represent an existential economic and national security threat.

And this is an intentional strategy on the part of President Obama.

I hate to use the I-word, but I truly feel that these policies -- opposed by the vast majority of Americans and unworthy of a "Commander-in-Chief" -- represent a crime of the highest order.

And this setback will cost Shell roughly $4 billion or more, which should do wonders for gas prices. Republicans better stand up to these bullying environmental nuts and de-fund the entire EPA until Obama is out of office.

Yes, I said it: Nuke the EPA from orbit. It's the only way to be sure.


Chart: GasBuddy.com. Hat tip: Michelle Malkin.

Sunday, April 24, 2011

China floats the idea of selling two-thirds of its US debt. Say, I wonder what will happen to gas and food prices when that happens?

With Ben Bernanke's "Quantitative Easing" 2.0 coming to an end, this news from China could represent the proverbial 'perfect storm'.

China Proposes To Cut Two Thirds Of Its $3 Trillion In USD Holdings


All those who were hoping global stock markets would surge tomorrow based on a ridiculous rumor that China would revalue the CNY by 10% will have to wait. Instead, China has decided to serve the world another surprise...

...China appears to be getting ready to cut its USD reserves by roughly the amount of dollars that was recently printed by the Fed, or $2 trillion or so. And to think that this comes just as news that the Japanese pension fund will soon be dumping who knows what. So, once again, how about that "end of QE" again?

...Xia Bin, a member of the monetary policy committee of the central bank, said ... that China should invest its foreign exchange reserves more strategically, using them to acquire resources and technology needed for the real economy...

And as if the public sector making it all too clear what is about to happen was not enough, here is the private one as well:

...China should reduce its excessive foreign exchange reserves and further diversify its holdings, Tang Shuangning, chairman of China Everbright Group, said on Saturday... Tang's remarks echoed the stance of Zhou Xiaochuan, governor of China's central bank, who said on Monday that China's foreign exchange reserves "exceed our reasonable requirement" and that the government should upgrade and diversify its foreign exchange management using the excessive reserves...

...While China is certainly tired of recycling US Dollars, it still has no viable alternative... But that will all change very soon. Once the push for broad Chinese currency acceptance is in play, the CNY and the USD will be unpegged, promptly followed by China dumping the bulk of its USD exposure, and also sending the world a message that US debt is no longer a viable investment opportunity.

In fact, we are confident that the reval is a likely a key preceding step to any strategic decision vis-a-vis US FX exposure (read bond purchasing/selling intentions). As such, all those Americans pushing China to revalue, may want to consider that such an action could well guarantee hyperinflation, once the Fed is stuck as being the only buyer of US debt.

Expect commodity prices -- especially oil and food -- to continue compensating for the insane fiscal policies of the current administration. By that I mean they will skyrocket.

What Obama and the Democrats have done with their deficit spending is truly awful. They have levied the most oppressive tax possible on the poor and middle class, making food and transportation far more expensive than under the evil Bush administration.

Remember in 2012.


Saturday, April 23, 2011

Alex Merk: U.S. Is 'Headed for a Fiscal Train-Wreck'

The invaluable Chris Martenson interviewed Axel Merk last week and was kind enough to post the transcript. The latter is president of Merk Investments, which operates a handful of mutual funds specializing in currency arbitrage.

Merk's statements -- while not altogether surprising -- should send shivers down the spine of any American concerned with this country's future.

...One of the things [Bernanke] has said is that one of the great mistakes during the great depression was to tighten too early, and as a result we deepened then the great depression or had the second leg downward and so he does not want to do that and he wants to err on the side of inflation...

...Right now, I have been arguing that the Fed can get away with murder. And what I mean by that is that because this money does not really stick anywhere. All this money printing – yes, it shows up in the excess reserves in the banking system but not all of it causes significant inflation. We see it in food and in energy but it takes a while for it to trickle through...

...we have Bernanke who has explicitly stated last August in his Jackson Hole speech, he wants to have inflation move higher, and then he was upset that the market did not endorse him and he started QE2. He wants inflation expectations to move higher. He needs to have the price level more higher so that people are bailed out from their mortgages who are underwater. And in the early 80’s when Volker said he was going to contain inflation, people did not take him seriously and it took a while. Well now, Bernanke says he wants high inflation; it is the same thing happening all over. The market did not take him seriously and by all means we will get higher inflation and at some point the markets will realize Bernanke was dead serious.

...of course we have seen inflation in food and energy go up... In the rest of the world where we have exported our policies, we gets riots, revolutions and other things happening because the citizens are more disgruntled and you can oppress your people but if you do not feed them, they will start a revolution.

...in the short term we see Japan has for example: a very high budget deficit, a huge amount of debt, those numbers are not very relevant in the short term. But what matters a great deal is the sustainability of the deficit, and in the US the math simply does not work. And if anybody who looks at those numbers knows we are heading towards a fiscal train wreck. Now politicians know that as well - some of them still think that you can tax the rich and be able to somehow solve these problems. It simply does not work with the math. And so what we have to do is we have to tackle entitlements. We have to tell people that they have to work longer and by the way when social security was first introduced, it was set at above the average life expectancy age, we have to have people have skin in the game in healthcare, Medicare, Medicaid...

...as far as the dollar is concerned, it is that sustainability of the deficit that people are concerned about and we still have time, but the time is going to run out within a few years.

...think about what would happen if we were to raise rates to 4-5% and indeed countries like Portugal, they scream for help from the European union because their cost of borrowing was going to something like 5% and it has gone beyond that since. But still 5% is not that high, at the same time if you look at the municipal bond market in the US, some people are saying well, the interest service payment for the municipalities is not all that high. Well yes, because they are paying only 1-2% on the interest. Let that go up, let the Fed tighten and suddenly let that debt servicing double for those municipalities and then we are going to have very serious problems.

...But one of the challenges of having low interest rates for an extended period is that you encourage everybody to take debt, and not just consumers but also government and municipalities. So what happens is we have a far greater interest rate sensitivity and that means we are far less shock-resistant be that on the consumer side if you lose a job or be that on, just on the government side. And all the budget projects by the way, by the CBO are based on the current interest rate environment and it is just unrealistic to think that that is going to continue forever...

...[in the U.S.] if we are going to get interest rates to 4% or 5%, that would push us right back into a very severe recession, probably depression.

To try the quick executive summary: the unprecedented deficit spending of the Obama administration has put U.S. policy-makers in a box. They can't lower interest rates any further. If they raise rates, they will likely set off a global depression.

Put simply: there's a reason my Dad always told me 'there ain't no such thing as a free lunch.' Unchecked deficit spending is like a ticking time bomb. And the American people -- not the powerful policy-makers -- will be the victims.


Hat tip: Tyler Durden.

Friday, April 22, 2011

Don't Raise the The Debt Ceiling: Consider it Federal Spending 'Cap-and-Trade' for President Obama

America is about to hit its $14 trillion debt ceiling, at which point the country's credit card is maxed out. Republicans need to do two things: they must brand their efforts to cut government spending and they must also force radical cuts upon an out-of-control federal government. We have no choice if we are to save this country; rest assured Democrats aren't going to play nice.

Of course, the Democrats are using the debt ceiling debate to spread fear, doubt and uncertainty. Because that's what Democrats do. Walter Cruttenden uses precision and candor to debunk their lies.

Listening to the dire warnings of President Obama, Treasury Secretary Geithner and the messengers of Big Government the American public lives in fear of what might happen if the debt ceiling is not immediately increased. We hear three recurring themes: we could relapse into economic crisis, interest rates will rise, and the US will lose credibility in the international investment community. But are these warnings true? Absolutely not!

In short, Cruttenden observes that:

• America doesn't hit the debt ceiling on a hard-and-fast date. The country can shift payments for months by prioritizing interest remittances over other bills.

• Fewer bonds issued will very likely mean interest rates drop as a phenomenon unknown to Democrats known as "supply-and-demand" kicks in.

• The only loss of credibility in the markets will occur if a serious effort to reduce the deficit doesn't begin now.

I propose a compromise of sorts, which I believe is my awesomest idea ever. I call it Debt Ceiling Cap-and-Trade. Democrats can begin slashing government to stay under the debt ceiling. If they need extra cash flow, try slashing the Department of Labor's budget by, say, 80%.

The Branding Is Simple: No More Blank Checks


The branding is as simple as it gets. For too long, the taxpayers have been robbed blind by politicians willing to borrow from generations yet unborn to fund their various entitlement schemes, pork and pet projects.

Those days are over.

Whenever a Democrat tries to tar a Republican as cruel or heartless, the response is concise and honest: No more blank checks.

Let the Democrats Pick the Spending Cuts


I call this part of the plan 'Debt Ceiling Cap-and-Trade'. We conservatives are nothing if not tolerant, so we'll let the Democrats pick their spending cuts.

And since Democrats love Cap-and-Trade, we'll let them determine which of their delightful programs get slashed and which survive. Here are their choices:

Democrats are free to pick any combination of programs that allow them to pay the bills. They get to choose. If they want to keep the interest payments on their mammoth deficit spending going, they need to begin slashing to find the money.

And the country benefits all around.

Seriously -- this is my bestest idea ever. Pass it on to your friends and family members. If we don't lay down the law now, when will we?

And the branding is simple enough even for a RINO to understand. No more blank checks!


Thursday, April 21, 2011

Report: White House Bullied Standard & Poor's in an Attempt to Cover-Up America's Rapidly Deteriorating Fiscal Condition

“That’s why today, I’m pledging to cut the deficit we inherited by half by the end of my first term in office.” --President Barack Obama, February 2009



When Standard & Poor's (S&P) notified the U.S. Treasury Department that it was considering an unprecedented move -- lowering the outlook on America's debt -- the Obama administration's first response was... to cover it up. Somehow this doesn't come as much of a surprise given the administration's affiliation with the likes of Trumka, Holder, La Raza, Stern, and Alinsky.

The Obama administration privately urged Standard & Poor’s in recent weeks not to lower its outlook on the United States — a suggestion the ratings agency ignored Monday, two people familiar with the matter said.

Treasury Department officials had been discussing with S&P whether the ratings agency should change its outlook on the United States to “negative” from “stable,” an indication that the country could lose its crucial AAA rating in coming years over its soaring debt levels...

Let me guess: the White House threatened to revoke S&P's coveted status as a federally accredited rating agency (also known as an "NRSRO"), which could devastate the company.

A cover-up is to be accepted from the Obama White House. After all, this kind of dishonesty is par for the course for President Obama. Remember, this is the same charismatic demagogue who claimed over and over that passing Obamacare would "lower premiums for each family by $2,500 a year."

It's no surprise that the White House would try to hide its poor stewardship of the public fisc in order to continue its perverse policies that have only made the problem worse.

It would at least be consistent. As we noted last Tuesday, the administration is reportedly engaged in a disinformation campaign to cover up the depth of the burden that's been dumped on American families.

The fiction is found on the White House's Federal Tax Receipt website. It says a family of three earning $50,000 a year pays a mere $19 in interest on the national debt.

...As Neil Munro of the Daily Caller has reported, the Congressional Budget Office estimates that interest payments cost the federal government $414 billion in 2010, "or $4,140 for a family of three, or 218 times more than the White House website shows."

Kudos to Standard & Poor's for standing up to the White House.

As The Financial Times put it:

S&P’s decision to downgrade the outlook on US sovereign debt from “stable” to “negative” for the first time in its history is like hearing a smoker cough and telling them that cigarettes give you cancer.

The warning can have two results. It may encourage the smoker to quit. Or their cold may get better and so prompt them to ignore alarmist advice from friends in future.

These F.T. authors are so quaint. They think President Obama is interested in saving the economy. I've got two Columbia professors who say otherwise.

There is only one word to describe the Obama administration: lawless.


Hat tip: Investors Business Daily.

Wednesday, April 20, 2011

Tipping Point: Government Cash Handouts Now Top Tax Revenues

If this isn't a harbinger of bad times, I'm not sure what would qualify.

U.S. households are now getting more in cash handouts from the government than they are paying in taxes for the first time since the Great Depression.

Gee, I'm not a math major, but that sounds... how you say in English? ...unsustainable to me.

Households received $2.3 trillion in some kind of government support in 2010. That includes expanded unemployment benefits, as well as payments for Social Security, Medicare, Medicaid, and stimulus spending, among other things... But that’s more than the $2.2 trillion households paid in taxes, an amount that has slumped largely due to the recession, according to an analysis by the Fiscal Times.

Mission Redistribution... Accomplished!

Also, an estimated 59% of the 308.7 million Americans in this country get at least one federal benefit, according to the Census Bureau, based on 2009 data. An estimated 46.5 million get Social Security; 42.6 million get Medicare; 42.4 million get Medicaid; 36.1 million get food stamps; 12.4 million get housing subsidies; and 3.2 million get Veterans' benefits.

And the handouts from the government have been growing. Government cash handouts account for a whopping 79% of household growth since 2007, even as household tax payments--for things like the income and payroll tax, among other taxes--have fallen by $312 billion.

We have incurred massive deficits under the aegis of "Stimulus" that failed to stimulate anything other than public sector union jobs.

We have seen an unprecedented expansion of the welfare state, which is, as the author observes, "a tough feeding trough to take away from voters."

Social Security and Medicare are poised to implode like a twisted Ponzi scheme of such scale that the housing crisis looks like a pothole in comparison.

And, finally, we're headed for an inevitable downgrade of U.S. sovereign debt should conservatives not win the day against Democrats and RINOs.

For if we conservatives do not succeed, our system, our civil society, will remain stable... until it doesn't. And then, somewhere, Cloward and Piven will beam as the most magnificent society ever seen on the face of the Earth begins to crumble.


Linked by: Michelle Malkin. Thanks!