So we had a rather pathetic 1.8% economic growth for the first quarter, but when you break that number down it gets ugly. Two-thirds of that 1.8% went into spending for business inventories/process improvements, not in sales to end consumers.
That brings our real growth to only 0.15%.
I can expand on this a little further to say that much of the money invested in inventories came from money that would have been spent on employee salaries. Material costs were low and businesses anticipated material prices to increase as a function of rising fuel costs and guaranteed higher cost of business as promised by the administration's proposed tax policies.
So companies are doing the smart thing and hunkering down for the impact of several economic realities. This plays out exactly as any student of Friedman or Von Mises would expect.
There are only two things I can think of that could possibly reverse this:
1. Drastic reduction in fuel costs (would have to come from reduction in fuel taxes, because that's all we have immediate control over).
2. The promise of significant tax and spending cuts.
I think there are probably some other REAL economic stimulus measures that could be instituted, but their impact would not be as significant as the above.
We must accept that the administration will not consider either of the above steps, because that would require an admission of fault, and this administration was founded on pride alone. All of the economists who touted President Obama's economic policies have now resigned. This is a small positive step, because there is no one left to claim the wisdom of these actions and President Obama may be able to present them as scapegoats, however I believe he wont.
Much like my earlier stock predictions, I hope I am wrong, but it seems I may have only been myopic in my time frame on the market.
Please present your ideas/thoughts.
Along the lines of what fuel prices are doing to the economy:
Dan Akerson, CEO of GM (Government Motors) suggests a dollar a gallon gas tax to drive people into more fuel efficient vehicles. I understand the concept of modifying consumer behavior via taxation, but considering the people this gas tax would hit hardest probably cannot afford to buy a new or even newer car, it sounds really regressive to me.
"NEW YORK (CNNMoney) -- General Motors CEO Dan Akerson said his company and his industry would be helped, not hurt, if consumers paid higher gas taxes.
In an interview published in Tuesday's Detroit News, Akerson floated the idea of a $1 a gallon increase in the gas tax as a way to encourage buyers to purchase smaller, more fuel efficient cars. Greg Martin, spokesman for GM's Washington office, confirmed that the quotes reflect Akerson's and GM's view.
Akerson said he would support a jump in the gas tax if it came instead of tighter fuel economy regulations that GM (GM, Fortune 500) and other automakers will have to meet in coming years. By the year 2025, automakers could be forced to hit fuel economy averages of as much as 62 mpg.
Akerson said that a higher gas tax, including an immediate 50-cent-a-gallon increase to take advantage of recent declines in gas prices, would probably make some of his Republican friends "puke." But he said it would do more to help the environment than the pending fuel economy rules."
http://money.cnn.com/2011/06/07/news/companies/gm_gas_tax_hike/
To over-simplify, the more money someone spends at the gas pump, the less they've got to spend at Wal-Mart or Reasor's.
In my industry, inventories are very slim. Manufacturers are trying to buy as much raw material like copper and steel on a JIT basis to keep from getting caught with their pants down if the bottom suddenly falls out of the commodity and raw material markets like they did in 2008/2009. That's making it really hard to meet customer demands on delivery time-lines. The higher gas and material costs are simply not sustainable for the long-term.
IMO, I think it's time to put some serious clamps on commodity futures trading. It's nothing more than people making money by pushing paper at the expense of end users and consumers.
One of my main clients just completed the install of 3 x 24,000 fuel tanks at their facility to store gasoline and diesel.
They actually purchased the options on this fuel last year, but have become concerned about the stability of that market as a whole, so they opted to spend the money to store it onsite.
Those tax cuts you propose have just added to our debt and didn't create any jobs.
Corporations are having record income quarters and now we don't have enough money to pay worker's pensions or keep schools open.
Quote from: RecycleMichael on June 08, 2011, 09:55:21 AM
Corporations are having record income quarters and now we don't have enough money to pay worker's pensions or keep schools open.
Excellent point!
Most of the companies I work with are also reporting record income. They have significantly less competition, having weathered the recession and watched their competitors go under. They have also emerged with a smaller workforce.
Now they have to make tough choices. With looming increases in the cost of business and and a decrease in the economic stability of their consumer base, they are doing exactly what smart businesses do.
Quote from: Conan71 on June 08, 2011, 09:29:14 AM
Along the lines of what fuel prices are doing to the economy:
Dan Akerson, CEO of GM (Government Motors) suggests a dollar a gallon gas tax to drive people into more fuel efficient vehicles. I understand the concept of modifying consumer behavior via taxation, but considering the people this gas tax would hit hardest probably cannot afford to buy a new or even newer car, it sounds really regressive to me.
"NEW YORK (CNNMoney) -- General Motors CEO Dan Akerson said his company and his industry would be helped, not hurt, if consumers paid higher gas taxes.
In an interview published in Tuesday's Detroit News, Akerson floated the idea of a $1 a gallon increase in the gas tax as a way to encourage buyers to purchase smaller, more fuel efficient cars. Greg Martin, spokesman for GM's Washington office, confirmed that the quotes reflect Akerson's and GM's view.
Akerson said he would support a jump in the gas tax if it came instead of tighter fuel economy regulations that GM (GM, Fortune 500) and other automakers will have to meet in coming years. By the year 2025, automakers could be forced to hit fuel economy averages of as much as 62 mpg.
Akerson said that a higher gas tax, including an immediate 50-cent-a-gallon increase to take advantage of recent declines in gas prices, would probably make some of his Republican friends "puke." But he said it would do more to help the environment than the pending fuel economy rules."
http://money.cnn.com/2011/06/07/news/companies/gm_gas_tax_hike/
To over-simplify, the more money someone spends at the gas pump, the less they've got to spend at Wal-Mart or Reasor's.
In my industry, inventories are very slim. Manufacturers are trying to buy as much raw material like copper and steel on a JIT basis to keep from getting caught with their pants down if the bottom suddenly falls out of the commodity and raw material markets like they did in 2008/2009. That's making it really hard to meet customer demands on delivery time-lines. The higher gas and material costs are simply not sustainable for the long-term.
IMO, I think it's time to put some serious clamps on commodity futures trading. It's nothing more than people making money by pushing paper at the expense of end users and consumers.
Great idea, add $5.00 to $10.00 for every 10 gallons of gas puchased at the pump, great way to drive the economy. Don't forget that that increase will be passed along to cities and towns and raise the cost of the services they provide. Cities would have to raise taxes or cut back on fuel usage for police, fire, refuse, etc.
Makes me wantt to go out and buy a horse, and maybe a simple wagon that it can pull. Wait, can't do that, I'll get taxed everytime the horse takes a crap.
Quote from: RecycleMichael on June 08, 2011, 09:55:21 AM
Those tax cuts you propose have just added to our debt and didn't create any jobs.
I need to address this too. I'm confused. . .
If you reduce energy costs (fuel) companies can expand business, and consumers can use that money elsewhere besides the gas tank.
If you reduce taxes, you also make that capital available for other uses both on the business and consumer side.
Both actions create opportunity, and opportunity creates jobs.
Any cuts would need to be balanced with spending reductions, so your claim really doesn't go anywhere.
Quote from: Gaspar on June 08, 2011, 10:17:18 AM
Any cuts would need to be balanced with spending reductions, so your claim really doesn't go anywhere.
It might be easier for them to understand if President Bush had not coupled a tax cut with massive spending increases.
Instead, it makes it easier to take the lazy approach to reducing the deficit and debt: raise taxes. Then you don't have to wrap your mind around or even acknowledge all the waste, duplicity, and dependence on the government which is rapidly bankrupting the country quicker than a lack of overall revenue.
Quote from: Gaspar on June 08, 2011, 10:17:18 AM
I need to address this too. I'm confused.
No need. That's a given.
Quote from: Gaspar on June 08, 2011, 10:02:37 AM
...they are doing exactly what smart businesses do.
Lobby for more tax breaks!
Quote from: Conan71 on June 08, 2011, 10:22:53 AM
It might be easier for them to understand if President Bush had not coupled a tax cut with massive spending increases.
Instead, it makes it easier to take the lazy approach to reducing the deficit and debt: raise taxes. Then you don't have to wrap your mind around or even acknowledge all the waste, duplicity, and dependence on the government which is rapidly bankrupting the country quicker than a lack of overall revenue.
Exactly my point. Scouring the news it seems that the only solution the left wants to engage is more spending and more taxation. Neither of which is capable of producing anything except an increase in "temporary" dependence. I say "temporary" because the weight of such dependence makes collapse imminent.
A couple of years ago their was the conspiratorial concept that President Obama and many of the ultra-liberal members of his majority congress may be engaged in a Cloward–Piven strategy to produce change based on collapsing the current system.
I think many of us, especially those of a libertarian persuasion, had fun with this possibility, but believed it could never come to be, because the American people would not allow themselves to be led down this path. The rebuke of Congress last year was evidence of that. Now I am not so sure we weren't too late.
Quote from: RecycleMichael on June 08, 2011, 10:30:12 AM
Lobby for more tax breaks!
No. . .Hunker down.
Hire temps.
Streamline workforce.
Invest in technology to increase efficiency.
Spend excess capital on inexpensive materials.
Purchase energy options for future use.
Anything but hire employees!
My thoughts on gaspar's premise from a bus wending its way across the Dominican Republic: If you're wrong, double down and be wrong twice. The Obama Derangement Syndrome schick is getting repetitive at this point.I'd be more verbose, but my other phone is in my luggage. This one has no keyboard, only swype.
I'm going to go and try to stimulate the economy. Buy gas at QT, have lunch at a locally owned restaraunt, and hit happy hour at a locally owned sports bar.
So. . .Just 4 hours after my initial post, CNN presents this headline:
Obama approval rating drops as fears of depression rise.
(CNN) – President Barack Obama's overall approval rating has dropped below 50 percent as a growing number of Americans worry that the U.S. is likely to slip into another Great Depression within the next 12 months, according to a new national poll.
The media went from a discussion of double dip recession all the way to depression. Even more shocking is that this came from a CNN poll which means it was undoubtedly fair and balanced.
So perhaps the change in lexicon will be enough to spur the administration to take action?
Quote from: nathanm on June 08, 2011, 11:25:14 AM
My thoughts on gaspar's premise from a bus wending its way across the Dominican Republic: If you're wrong, double down and be wrong twice. The Obama Derangement Syndrome schick is getting repetitive at this point.I'd be more verbose, but my other phone is in my luggage. This one has no keyboard, only swype.
So. . .
(http://farm6.static.flickr.com/5273/5812730156_486c7614eb.jpg)
Quote from: Gaspar on June 08, 2011, 12:52:10 PM
So. . .Just 4 hours after my initial post, CNN presents this headline:
Obama approval rating drops as fears of depression rise.
(CNN) – President Barack Obama's overall approval rating has dropped below 50 percent as a growing number of Americans worry that the U.S. is likely to slip into another Great Depression within the next 12 months, according to a new national poll.
The media went from a discussion of double dip recession all the way to depression. Even more shocking is that this came from a CNN poll which means it was undoubtedly fair and balanced.
So perhaps the change in lexicon will be enough to spur the administration to take action?
Approval ratings change as fast as
a woman's Gaspar's mood.
FAIL!
Quote from: Teatownclown on June 08, 2011, 01:58:11 PM
Approval ratings change as fast as a woman's Gaspar's mood.
FAIL!
Par
Because Obama and the Dems have promoted dozens of bills that would have created jobs and shifted our economy in a positive direction, like High Speed Rail, Wind Farms, Residential Solar, and not only have they been blocked at almost every turn by the GOP while the Media (Left, Right and Center) all seem to miss the story. Once stimulus money started to dry up and no more action was able to go forward, mainly due to the oppositon in Congress, the improvement has stopped.
It's so easy if you do the opposite of what Boehner, Norquist, Ryan and the rest of the right wing dim bulbs suggest.
Keep jawboning the recovery into a second dip, lets get the GOP back in here to finish the job, that's what y'all want, right? Because that's what's happening here.
Birdie!
Guess we must be doing something right. We are building wind farms in Arizona, a solar company is going to build a manufacturing plant in Mesa, and Intel is building a new manufacturing facility in Chandler. I don't see anybody blocking things here.
Quote from: Teatownclown on June 08, 2011, 02:19:01 PM
Because Obama and the Dems have promoted dozens of bills that would have created jobs and shifted our economy in a positive direction, like High Speed Rail, Wind Farms, Residential Solar, and not only have they been blocked at almost every turn by the GOP while the Media (Left, Right and Center) all seem to miss the story. Once stimulus money started to dry up and no more action was able to go forward, mainly due to the oppositon in Congress, the improvement has stopped.
It's so easy if you do the opposite of what Boehner, Norquist, Ryan and the rest of the right wing dim bulbs suggest.
Keep jawboning the recovery into a second dip, lets get the GOP back in here to finish the job, that's what y'all want, right? Because that's what's happening here.
Birdie!
Obama is going to learn he wasted a ton of political capital on pushing so hard for legacy issues like Obamacare and bank reform when he could have used his majorities in the House and Senate to have worked on real job measures like you mentioned. Instead, he only wound up creating new bureaucratic positions for over-sight and even more government administration.
The "stimulus" measures have accomplished little other than bolstering construction industries. Things like cash for clunkers helped get rid of stale inventory on dealer's lots, but it was not a sustainable injection into the economy.
You apparently see it as the government didn't spend money long enough to jump start the economy. I think the government did nothing but construct temporary measures which had no hope of creating sustained growth.
Some of this news is political shenanigans. This is the same rattle that started about June of 2007 of pending economic doom. A major part of a recession is purely psychological. Tell business people a second Great Depression is coming, and they will put off all sorts of spending and start hoarding. They will not hire new employees, they will not buy new equipment, they will start thinning the herd. Guess what happens next? A real recession starts to grow. If you can beat up on consumer and commercial confidence enough, you will force people into a recession. If the economy is still in the crapper in Nov. 2012, President Obama becomes a one-term President. Start a wave of ominous sounding news now and chances are it will become a reality.
I will bet you he will not be a one term President and even if you brought back Reagan from the dead. Wait a minute...
The Dead Reagan for President? Nah. Lightening will not strike twice in the same place....
Pick your wager! ;)
Quote from: Gaspar on June 08, 2011, 10:35:54 AM
Exactly my point. Scouring the news it seems that the only solution the left wants to engage is more spending and more taxation. Neither of which is capable of producing anything except an increase in "temporary" dependence. I say "temporary" because the weight of such dependence makes collapse imminent.
I never know how seriously to take your posts, because it's as if your only ideological motivator is that the proles never become dependent on government for anything at any time. And that every moment is the right moment to retrench, retreat, and reduce any perceived dependence. I know that somehow using your mathematics reduced government involvement magically increases freedom no matter the context, but that seems so obviously ridiculous in the face of massive need. At some point, isn't withholding help because of possible future dependence trumped by what's happening on the ground, now?
Also: making sure that employers somehow have even more money to hoard is useless. There's no incentive value to tax cuts for business. They'll just throw their savings on the pile with their record profits and continue to not invest.
How bout we raise the minimum wage?
Quote from: we vs us on June 08, 2011, 03:41:01 PM
I never know how seriously to take your posts, because it's as if your only ideological motivator is that the proles never become dependent on government for anything at any time. And that every moment is the right moment to retrench, retreat, and reduce any perceived dependence. I know that somehow using your mathematics reduced government involvement magically increases freedom no matter the context, but that seems so obviously ridiculous in the face of massive need. At some point, isn't withholding help because of possible future dependence trumped by what's happening on the ground, now?
Also: making sure that employers somehow have even more money to hoard is useless. There's no incentive value to tax cuts for business. They'll just throw their savings on the pile with their record profits and continue to not invest.
How bout we raise the minimum wage?
Why is there such massive need in the first place?
What you fail to realize in any of that is this IS the result of far too much dependence on government in the first place. There's simply never going to be any ideal time to start with cuts, but to keep on doing what we've been doing wrong in the name of compassion is insane.
Look at the problems government has fomented out of programs it deemed worthy. Government insistence that homeownership should be a "right" for everyone led to a stupid lending binge that helped push our economy off a cliff as one example of why sometimes it's better to allow free markets to operate without artificial intervention.
From The WSJ:
The picture is even gloomier if we look in more detail. Estimates of monthly GDP indicate that the only growth in the first quarter of 2011 was from February to March. After a temporary rise in March, the economy began sliding again in April, with declines in real wages, in durable-goods orders and manufacturing production, in existing home sales, and in real per-capita disposable incomes. It is not surprising that the index of leading indicators fell in April, only the second decline since it began to rise in the spring of 2009.
The data for May are beginning to arrive and are even worse than April's. They are marked by a collapse in payroll-employment gains; a higher unemployment rate; manufacturers' reports of slower orders and production; weak chain-store sales; and a sharp drop in consumer confidence.
The economy will continue to suffer until there is a coherent and favorable economic policy. That means bringing long-term deficits under control without raising marginal tax rates—by cutting government outlays and by limiting the tax expenditures that substitute for direct government spending. It means lower tax rates on businesses and individuals to spur entrepreneurship and investment. And it means reforming Social Security and Medicare to protect the living standards of future retirees while limiting the cost to future taxpayers.
All of these things are doable. But the Obama administration has not done them and shows no inclination to do them in the future.
SUCKS!
QuoteAs Mark Levin likes to say, everything Barack Obama touches turns to crap.
But why should that stop our blissfully out-of-touch President from citing a soon-to-be defunct restaurant as an example of why the auto industry bailouts have been such smashing successes?
http://jammiewearingfool.blogspot.com/2011/06/reverse-midas-touch-ohio-restaurant.html
You wan know why the stimulus mostly only forestalled worsening of the economic situation rather than bringing real improvement? Half of it was tax cuts that mostly went to people who weren't going to spend money even if God Himself ordered them to do so.
We seem to be hell bent on repeating the mistakes of 1937. It's more than a little ironic that today's 'conservatives' ignore history so completely. Thankfully, we're in a situation more akin to Japan after its meltdown and not a new Great Depression. (or so it seems so far)
Also, I don't think it helped one whit that the Bush Administration decided there would be few or no prosecutions for the rampant fraud in the derivatives market (and mortgage market) and that the Obama Administration foolishly continued that policy. Hell, there was clear malfeasance within the Bush Administration that went unpunished. We need a head knocker like Teddy or even Franklin Roosevelt, but all we get is Obama, who, while being better than any of the Republican options, apparently lacks the cajones of either.
Nate,
This is ehhaustive and non productive. We both have different (and sometimes the same) interpretations of who is at fault. At this point, the blame game is useless. I don't give a smile if it was Santa Clause who started the whole Fredy/Fannie collapse.
There are only a few viable solutions left. That's what we are discussing here. Unfortunately that is what the whole country has to discuss now, even many Democrats. We can blather about how we are going to produce millions of green jobs out of our asses or we can simply do the things necessary to save the economy.
The steps necessary to save the economy are not new, they are not borne of "brilliance" or pride, they are simple and proven, and businesses have been begging for them for 3 years.
Instead of President Obama giving the economy what he thinks it needs, it's time he gives it what it wants!
Gaspar, that's not entirely true.
The Bush tax cuts have been extended due to heavy lobbying which claimed it would help bolster the economy by creating a more business and investment-friendly environment. That was one thing business ("the economy") demanded out of Congress and the President and they got it. That was the magic panacea that would turn things around.
I said at the time, "don't let the tax cuts expire, it's put up or shut up time. If the economy rebounds and treasury revenue increases, we know it works. If we are still in the doldrums a year or two down the road, take the cuts away as it's obviously not a solution."
That extra 3% of income doesn't appear to be finding it's way back into the economy yet, or at least very slowly.
Quote from: Conan71 on June 10, 2011, 08:44:10 AM
Gaspar, that's not entirely true.
The Bush tax cuts have been extended due to heavy lobbying which claimed it would help bolster the economy by creating a more business and investment-friendly environment. That was one thing business ("the economy") demanded out of Congress and the President and they got it. That was the magic panacea that would turn things around.
I said at the time, "don't let the tax cuts expire, it's put up or shut up time. If the economy rebounds and treasury revenue increases, we know it works. If we are still in the doldrums a year or two down the road, take the cuts away as it's obviously not a solution."
That extra 3% of income doesn't appear to be finding it's way back into the economy yet, or at least very slowly.
The cuts in taxes were attached to nothing! There was no reduction in spending. Nothing to encourage businesses that government was going to act more responsibly. On the contrary, the carrot was attached to baseball bats. Promises of tax increases, restrictions, additional healthcare and administrative burdens on employers. All while massive new spending endeavors were hatched and launched.
Businesses understand what is and what is not sustainable, and the policies proposed were in no way sustainable, nor did they offer any advantage to an employer to take on additional liability.
The extension of the Bush tax structure was not a "gift," It was a delay of increased taxes, and the administration said as much.
It's like saying, "I am going to take away your car", then amending that by saying "I am going to take away your car, but I'll wait until next month." Are you going to invest anything in your car knowing that? Gonna buy a new set of rims?
Gaspar, did you seriously forget the almost $350 billion in new tax cuts included in the stimulus? You seriously think that there have been massive new regulations on business over and above what we had in the 90s? (even finreg lacks much in the way of actual regulation)
You seriously think government is taking the metaphorical car? You're so divorced from reality on this it's painful. Conan and I, for example, have major differences of opinion and ideology, but at least we can agree on the facts of what has actually happened, even if we can't agree on the way forward.
I'm still flabbergasted that you claim that seeing your political ends acheived is apolitical, while seeing mine acheived would be pure politics. It's also odd that you make the claim that the economy as a whole is not a zero sum game when we're talking about income inequality but that it is when it comes to government spending. Be like Avis..try harder. ;)
Quote from: Conan71 on June 10, 2011, 08:44:10 AM
Gaspar, that's not entirely true.
The Bush tax cuts have been extended due to heavy lobbying which claimed it would help bolster the economy by creating a more business and investment-friendly environment. That was one thing business ("the economy") demanded out of Congress and the President and they got it. That was the magic panacea that would turn things around.
I said at the time, "don't let the tax cuts expire, it's put up or shut up time. If the economy rebounds and treasury revenue increases, we know it works. If we are still in the doldrums a year or two down the road, take the cuts away as it's obviously not a solution."
That extra 3% of income doesn't appear to be finding it's way back into the economy yet, or at least very slowly.
Yup, its not a simple "cut taxes" and revenue increases. You have to remember that rich people have assets. You can choose to sell assets. So you choose to do it when the taxes are lower. Its gives a nice bump, then the assets are gone and won't be sold for a few more years. Then there is the dumb concept that because you give a company more money they magically hire employees they don't need.
Gaspar,
You and I usually see eye-to-eye on economic issues, but I can't help but hear the scraping sound of shifting goal posts. I don't recall a reduction in government spending as being part of the argument on why the Bush tax cuts shouldn't be allowed to expire. I believe everyone was aware the extension was temporary but it was still billed as being a cure for the recession. By agreeing to extend them, the administration was recognizing more cash flowing through the economy rather than being taken out via taxation had a reasonable expectation for economic growth. Apparently that's not working as GDP is not rising significantly, jobs aren't being created, consumer spending is down, and manufacturing orders are down. That was in a nutshell the justification for extending the Bush tax cuts. That's really got nothing to do with what the government is or is not spending.
No, I'm not ignoring that spending needs to be cut. It's got to be cut whether taxes stay the same, are reduced, or increase. At this point, I think tax increases are unavoidable. No one is willing to risk the political capital to do that. Votes appear more important than doing what is fiscally correct.
I don't have a problem with tax increases, what I have a problem with is when they are done for nothing more than class warfare/envy. Personally, I believe a truly conservative solution I'm not hearing out of any of our conservative prospects for POTUS is across the board tax increases for every income level with a like amount of across the board spending decreases. In my mind, conservatism doesn't simply revolve around lower tax rates. It revolves around smart revenue management.
Thus far, it appears all the spending cuts Congress has been doing is nothing but smoke and mirrors once the CBO scores are put to it. Too many sacred cows are in play. Blind cuts, 3% from every department and entitlement program. Make an existing department with existing employees responsible for seeking out and eliminating the obviously wasteful programs like you have been highlighting on here lately.
Middle class already has enough taxes make a new bracket with a few % higher and raise the lower %. Increase long term capital gains to max of 20-22%. Yes I know the middle class will have to pay the low end taxes. Back to the Coburn science spending post. Start getting rid of BS like farmville research.
Quote from: CharlieSheen on June 10, 2011, 09:57:51 AM
Middle class already has enough taxes make a new bracket with a few % higher and raise the lower %. Increase long term capital gains to max of 20-22%. Yes I know the middle class will have to pay the low end taxes. Back to the Coburn science spending post. Start getting rid of BS like farmville research.
The middle class has been a major benefactor of tax cuts and tax credits in recent years. They are also the ones who get to enjoy the bulk of child tax credits, tuition credits, partook in the first time home buyer's program, etc.
I'm not saying they aren't carrying some of the burden, but realistically, effective their federal income tax rate (not including payroll taxes) is really pretty slim once you take into account the common credits they use. 3% would not mean significant pain to a family earning $60K.
We've all got to depend a little less on government and be willing to share in cleaning up the balance sheet. Simply saying the wealthy should take on that burden alone because they can afford to is politics at its absolute worst. Why shouldn't everyone be expected to sacrifice something?
Quote from: Conan71 on June 10, 2011, 09:50:06 AM
Gaspar,
You and I usually see eye-to-eye on economic issues, but I can't help but hear the scraping sound of shifting goal posts. I don't recall a reduction in government spending as being part of the argument on why the Bush tax cuts shouldn't be allowed to expire. I believe everyone was aware the extension was temporary but it was still billed as being a cure for the recession. By agreeing to extend them, the administration was recognizing more cash flowing through the economy rather than being taken out via taxation had a reasonable expectation for economic growth. Apparently that's not working as GDP is not rising significantly, jobs aren't being created, consumer spending is down, and manufacturing orders are down. That was in a nutshell the justification for extending the Bush tax cuts. That's really got nothing to do with what the government is or is not spending.
No, I'm not ignoring that spending needs to be cut. It's got to be cut whether taxes stay the same, are reduced, or increase. At this point, I think tax increases are unavoidable. No one is willing to risk the political capital to do that. Votes appear more important than doing what is fiscally correct.
I don't have a problem with tax increases, what I have a problem with is when they are done for nothing more than class warfare/envy. Personally, I believe a truly conservative solution I'm not hearing out of any of our conservative prospects for POTUS is across the board tax increases for every income level with a like amount of across the board spending decreases. In my mind, conservatism doesn't simply revolve around lower tax rates. It revolves around smart revenue management.
Thus far, it appears all the spending cuts Congress has been doing is nothing but smoke and mirrors once the CBO scores are put to it. Too many sacred cows are in play. Blind cuts, 3% from every department and entitlement program. Make an existing department with existing employees responsible for seeking out and eliminating the obviously wasteful programs like you have been highlighting on here lately.
Static revenue would be the only reason for tax increases. Those increases would then decrease revenue even further by resulting in lower job growth. At this point revenue balance needs to be mitigated with spending cuts, and everything needs to be done to increase the investment businesses are willing to make in the economy.
Not only is class warfare the most damaging issue, but it is exactly what is destroying confidence in the economy. Business owners feel that they are targets. The private sector has been placed squarely in the sights as the enemy, and unless that changes we will see no growth.
You can discuss tax increases all you like but any increase in revenue they produce will be tragically temporary, and as businesses simply pass tax increases to the consumer, they will represent the final nail in the coffin of an economy attempting to escape the grave.
On the other side of the philosophical coin, you have a revenue shortfall caused by a contracted economy. Your primary objective it to cause that economy to expand, as a result of that you will achieve increased revenue. Priority should be on the economy, not on government revenue! Government spending can be reduced and then re-established at a later date if necessary. The same can't be said for private businesses.
Quote from: Conan71 on June 10, 2011, 10:05:22 AM
The middle class has been a major benefactor of tax cuts and tax credits in recent years. They are also the ones who get to enjoy the bulk of child tax credits, tuition credits, partook in the first time home buyer's program, etc.
I'm not saying they aren't carrying some of the burden, but realistically, effective their federal income tax rate (not including payroll taxes) is really pretty slim once you take into account the common credits they use. 3% would not mean significant pain to a family earning $60K.
We've all got to depend a little less on government and be willing to share in cleaning up the balance sheet. Simply saying the wealthy should take on that burden alone because they can afford to is politics at its absolute worst. Why shouldn't everyone be expected to sacrifice something?
You are right on the child tax credits etc. They should be removed.
Quote from: Gaspar on June 10, 2011, 10:13:13 AM
Static revenue would be the only reason for tax increases. Those increases would then decrease revenue even further by resulting in lower job growth. At this point revenue balance needs to be mitigated with spending cuts, and everything needs to be done to increase the investment businesses are willing to make in the economy.
You still are missing the fact that lower taxes doesn't mean higher job growth. Taxes are lower than they were in 2008. Where is the job growth? More money in a business doesn't always mean more jobs it only means more profits.
Quote from: CharlieSheen on June 10, 2011, 10:23:29 AM
You still are missing the fact that lower taxes doesn't mean higher job growth. Taxes are lower than they were in 2008. Where is the job growth? More money in a business doesn't always mean more jobs it only means more profits.
You are correct, that's why it has to be attached to some form of responsibility on the part of government and impart some degree of confidence in promoting a "business friendly economy."
Besides the contracted economy, the primary cause of our stagnation in growth is based on an administration that is completely focused on government expansion. There is every indication that they intend to use up what is left of private sector growth to fund that, and no indication that they put any value on the growth of the private sector except as an engine for government spending.
Even if the president poses another temporary tax cut to the wealthy it WILL NOT WORK. We are beyond temporary solutions to permanent problems. We need to change the way this administration views the private sector and vise-versa. As I mentioned before that would mean admitting some degree of fault, and that is simply out of the question for President Obama.
Pride goes before destruction, a haughty spirit before a fall.
You're listening to the wrong radio shows, d00d.
Quote from: we vs us on June 10, 2011, 11:19:03 AM
You're listening to the wrong radio shows, d00d.
Didn't I say some time back he's our own local version of Beck? And not the 'two turntables and a microphone' kind, either...
Quote from: Gaspar on June 10, 2011, 10:13:13 AM
Static revenue would be the only reason for tax increases. Those increases would then decrease revenue even further by resulting in lower job growth. At this point revenue balance needs to be mitigated with spending cuts, and everything needs to be done to increase the investment businesses are willing to make in the economy.
But there's been little job growth as a result. It was touted we could not grow jobs if the Bush tax cuts expired. They didn't expire, the government has continued to spend even more money it does not have, and guess what? We are still not recovering and neither idea of what sort of consumption would make the economy recover has been successful, it would appear. Now what?
Ever since 2008, the government has been handing out tax cuts and tax credits like candy (energy efficiency improvement credits, first time home buyer, cash for clunkers, etc.), yet unemployment has grown and can't seem to get back below 9%. Those were all temporary in nature, but we cannot continue to essentially provide every new homeowner with what amounts to a $7500 rebate from the government to go spend at Lowe's and Home Depot. The tax structure, just like the spending structure must necessarily evolve with the times. I'm in a middle class tax bracket. I'm still in shock at the different credits I've gotten in recent years.
Even the extra 3% the "wealthy" are being allowed to keep doesn't seem to be doing anything to stimulate more job growth. If companies have no need for more employees, they simply are not going to hire them regardless of taxation. Conversely, if a company needs more employees, they will hire them regardless of the tax climate (within reason, 3% is hardly something to get in a twist over). Obamacare is a whole other can of worms as well as new environmental regulation when it comes to the confidence of those who hire. However, I'm simply trying to point out the argument that extending the Bush tax cuts would help with economic recovery appears to have been a complete fallacy.
There's simply still not enough demand to stimulate the economy and rising fuel prices are dictating money which could be spent on consumer goods or even small vacations is going into the tank and out through the tailpipe. I realize spending patterns of people who aren't living paycheck to paycheck gives them far more discretion on where they spend or don't spend their money. Forecasts of an impending depression are going to create enough psychological resistance to hiring and spending right now as people hoard cash waiting for the worst. It's starting to become apparent even marginally lower taxes on their own simply would not stimulate any new job growth right now.
Of course there is one more issue which makes this even more difficult. We demand low priced consumer goods here in the states to the detriment of American jobs. Example: I bought a new chain cleaning kit for my bicycle yesterday. I got it home and on the package it says: "Designed In Italy. Made In China. Packaged In America." I didn't pay attention before I left the bike shop. It's basically an assembly of injection-molded plastic which is a relatively inexpensive process. It's the tooling which is costly because it's very labor intensive to build the molds. Otherwise for a product like that, you pay someone to man the molding machines, and people to assemble the parts into a working unit.
Is that the sort of standard of living we want? We can't make anything here but we can have it manufactured overseas then we can pay Americans menial wages to package it for us. If we didn't put such a priority on lower priced goods, we wouldn't be losing so many jobs to China.
Some durable goods cost about the same or little more than they did 20 to 25 years ago. They use cheaper materials and the people that make those products are willing to work for much less money than Americans will.
/ramble
Not a ramble, what you are saying makes perfect sense except. . .
We were on the decline, and any tax increase would have accelerated that (both sides agree on that). Extending the tax cuts alone did nothing to further stimulate, or create jobs. All that did was slow the downward spiral. After all, it was not like the government was providing anything new, it was just not taking anything more.
Cutting taxes works, but not when you increase spending at the same time. It's like a dividend on a stock. . .when you see companies increase their dividends to shareholders while at the same time increasing their spending without any increase in revenue, it raises red flags among investors. Conversely, any stock that increases dividend yield while at the same time increasing revenue and showing a respectable amount spent on development will gain investment capital.
We are all deeply invested in our government and those with the most significant investment are the business owners who shoulder the highest investment burden. They must be treated as partners, not as a means.
Quote from: Gaspar on June 10, 2011, 01:25:41 PM
Not a ramble, what you are saying makes perfect sense except. . .
We were on the decline, and any tax increase would have accelerated that (both sides agree on that). Extending the tax cuts alone did nothing to further stimulate, or create jobs. All that did was slow the downward spiral. After all, it was not like the government was providing anything new, it was just not taking anything more.
Cutting taxes works, but not when you increase spending at the same time. It's like a dividend on a stock. . .when you see companies increase their dividends to shareholders while at the same time increasing their spending without any increase in revenue, it raises red flags among investors. Conversely, any stock that increases dividend yield while at the same time increasing revenue and showing a respectable amount spent on development will gain investment capital.
We are all deeply invested in our government and those with the most significant investment are the business owners who shoulder the highest investment burden. They must be treated as partners, not as a means.
I'd agree but it does appear it worked under the Bush Admin. The recession of '01/'02 was pretty well mitigated and we went to what was essentially full employment for several years and we experience real economic growth. Bush spent money like a drunken liberal, as well as being faced with several massive natural disasters, two new wars, and a huge new bureaucracy.
IMO, President Obama wasted his first two years in office trying to ram through his legacy agenda while he had majorities in both houses. Instead of going to work on the economy, he spent the first 8 to 12 weeks continuing to bash the economy into the ground. He and Geithner did absolutely nothing to inspire confidence in the economy. Real or imagined, the Obama Administration was painted as socialists before he was even sworn in, yet they did nothing to try and dispel that notion. Instead of trying to reassure corporate and small business America, they proceeded with all sorts of programs and initiatives which would wind up doing nothing to inspire confidence.
Obamacare either created enough doubt amongst less savvy business owners who still don't fully understand it nor what compliance will look like and apparently that's enough to keep some small businesses from adding anyone to the payroll out of fear of additional costs and time for compliance. That's what I'm hearing anecdotally anyhow. Now they appear to want to press on with cap and trade.
Couple that with our continued demand for cheap consumer goods and I honestly think 9% U.E. could be the new norm. We've ceded many jobs to cheaper labor outside our borders.
If you want to argue that lower taxes inspires something psychologically which will make people create jobs when they are needed I can buy that. If you are saying higher taxes symbolizes hostility toward business and therefore they won't hire new people either out of spite or fear, I can see that. However, if you are maintaining that it's simply lower taxes which will create jobs, it's impossible. Demand will create jobs regardless of the tax climate when you are only talking a few percentage points. People hire people, economic theory physically cannot hire them.
. . .and Geithner is the only one left of the original economic dream team. Many are contending that President Obama has to get rid of him this year in order to formulate a good scapegoat for economic disaster. I don't think that will happen. I think there is so much pride that President Obama will continue to pump up his aura of blame on previous administrations, Greece, the EU, China, The filthy rich, Santa, bigfoot, chupacabras, and space aliens.
He will take no fault in anything, and it will be golf business as usual.
Any reports of economic downturn will be "unexpected" by the media.
Quote from: Gaspar on June 10, 2011, 02:36:09 PM
. . .and Geithner is the only one left of the original economic dream team. Many are contending that President Obama has to get rid of him this year in order to formulate a good scapegoat for economic disaster. I don't think that will happen. I think there is so much pride that President Obama will continue to pump up his aura of blame on previous administrations, Greece, the EU, China, The filthy rich, Santa, bigfoot, chupacabras, and space aliens.
He will take no fault in anything, and it will be golf business as usual.
Any reports of economic downturn will be "unexpected" by the media.
"now, watch this drive"...
Quote from: Gaspar on June 10, 2011, 02:36:09 PM
. . .and Geithner is the only one left of the original economic dream team. Many are contending that President Obama has to get rid of him this year in order to formulate a good scapegoat for economic disaster. I don't think that will happen. I think there is so much pride that President Obama will continue to pump up his aura of blame on previous administrations, Greece, the EU, China, The filthy rich, Santa, bigfoot, chupacabras, and space aliens.
He will take no fault in anything, and it will be golf business as usual.
Any reports of economic downturn will be "unexpected" by the media.
All fine and good, but can you explain the growth in the economy you said wasn't possible with tax cuts and increased government spending under President Bush?
Quote from: Conan71 on June 10, 2011, 03:03:29 PM
All fine and good, but can you explain the growth in the economy you said wasn't possible with tax cuts and increased government spending under President Bush?
My guess? A republican President....
But that's just a guess. You know me...
;D
Quote from: Conan71 on June 10, 2011, 03:03:29 PM
All fine and good, but can you explain the growth in the economy you said wasn't possible with tax cuts and increased government spending under President Bush?
Sure. As I mentioned above, the promotion of a business friendly. . .no. . .business-centric economy.
Bush pushed small business as the foundation of economic growth for the most part until late in his presidency when he hit the "whatever" button.
Quote from: Gaspar on June 10, 2011, 03:48:03 PM
Bush pushed small business as the foundation of economic growth for the most part until late in his presidency when he hit the "whatever" "I'm Done" button.
FIFY ;)
Quote from: Conan71 on June 10, 2011, 03:03:29 PM
All fine and good, but can you explain the growth in the economy you said wasn't possible with tax cuts and increased government spending under President Bush?
Bubble economy in housing and financial sectors (and not just a bubble in the US but elsewhere which also helped our companies export and manufacturing) plus, Borrowed/debt economy (not just the government but its citizens)?
Quote from: TheArtist on June 10, 2011, 04:20:14 PM
Bubble economy in housing and financial sectors (and not just a bubble in the US but elsewhere which also helped our companies export and manufacturing) plus, Borrowed/debt economy (not just the government but its citizens)?
That was a part of it but there was growth in every sector, not just fueled by housing and borrowing. Of course housing and borrowing were enough to trigger the quake!
But, it's not like that snuck up on us. Congress, and in particular Barney Frank and Chris Dodd, were warned 17 times that they were fueling a bubble that could take the entire US economy down.
Quote from: Gaspar on June 10, 2011, 04:28:10 PM
That was a part of it but there was growth in every sector, not just fueled by housing and borrowing. Of course housing and borrowing were enough to trigger the quake!
But, it's not like that snuck up on us. Congress, and in particular Barney Frank and Chris Dodd, were warned 17 times that they were fueling a bubble that could take the entire US economy down.
If the House and Senate were under Republican control when the warnings were issued to Frank & Dodd in 2002, how is it this continued until the bubble started to burst in '06, '07' and '08? Why were Frank and Dodd not blocked in their antics with Fannie and Freddie?
Quote from: dbacks fan on June 10, 2011, 04:50:47 PM
If the House and Senate were under Republican control when the warnings were issued to Frank & Dodd in 2002, how is it this continued until the bubble started to burst in '06, '07' and '08? Why were Frank and Dodd not blocked in their antics with Fannie and Freddie?
Good question.
2001April: The Administration's FY02 budget declares that the size of Fannie Mae and Freddie Mac is "a potential problem," because "financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity."
2002May: The President calls for the disclosure and corporate governance principles contained in his 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac. (OMB Prompt Letter to OFHEO, 5/29/02)
2003January: Freddie Mac announces it has to restate financial results for the previous three years.
February: The Office of Federal Housing Enterprise Oversight (OFHEO) releases a report explaining that "although investors perceive an implicit Federal guarantee of [GSE] obligations," "the government has provided no explicit legal backing for them." As a consequence, unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market. ("Systemic Risk: Fannie Mae, Freddie Mac and the Role of OFHEO," OFHEO Report, 2/4/03).
September: Fannie Mae discloses SEC investigation and acknowledges OFHEO's review found earnings manipulations.
September: Treasury Secretary John Snow testifies before the House Financial Services Committee to recommend that Congress enact "legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises" and set prudent and appropriate minimum capital adequacy requirements.
October: Fannie Mae discloses $1.2 billion accounting error.
November: Council of the Economic Advisers (CEA) Chairman Greg Mankiw explains that any "legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk." To reduce the potential for systemic instability, the regulator would have "broad authority to set both risk-based and minimum capital standards" and "receivership powers necessary to wind down the affairs of a troubled GSE." (N. Gregory Mankiw, Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership, 11/6/03).
2004February: The President's FY05 Budget again highlights the risk posed by the explosive growth of the GSEs and their low levels of required capital, and called for creation of a new, world-class regulator: "The Administration has determined that the safety and soundness regulators of the housing GSEs lack sufficient power and stature to meet their responsibilities, and therefore...should be replaced with a new strengthened regulator." (2005 Budget Analytic Perspectives, pg. 83)
February: CEA Chairman Mankiw cautions Congress to "not take [the financial market's] strength for granted." Again, the call from the Administration was to reduce this risk by "ensuring that the housing GSEs are overseen by an effective regulator." (N. Gregory Mankiw, Op-Ed, "Keeping Fannie And Freddie's House In Order," Financial Times, 2/24/04).
June: Deputy Secretary of Treasury Samuel Bodman spotlights the risk posed by the GSEs and called for reform, saying "We do not have a world-class system of supervision of the housing government sponsored enterprises (GSEs), even though the importance of the housing financial system that the GSEs serve demands the best in supervision to ensure the long-term vitality of that system. Therefore, the Administration has called for a new, first class, regulatory supervisor for the three housing GSEs: Fannie Mae, Freddie Mac, and the Federal Home Loan Banking System." (Samuel Bodman, House Financial Services Subcommittee on Oversight and Investigations Testimony, 6/16/04).
2005April: Treasury Secretary John Snow repeats his call for GSE reform, saying "Events that have transpired since I testified before this Committee in 2003 reinforce concerns over the systemic risks posed by the GSEs and further highlight the need for real GSE reform to ensure that our housing finance system remains a strong and vibrant source of funding for expanding homeownership opportunities in America... Half-measures will only exacerbate the risks to our financial system." (Secretary John W. Snow, "Testimony Before The U.S. House Financial Services Committee," 4/13/05).
2007July: Two Bear Stearns hedge funds invested in mortgage securities collapse.
August: President Bush emphatically calls on Congress to pass a reform package for Fannie Mae and Freddie Mac, saying "first things first when it comes to those two institutions. Congress needs to get them reformed, get them streamlined, get them focused, and then I will consider other options." (President George W. Bush, Press Conference, The White House, 8/9/07).
September: RealtyTrac announces foreclosure filings up 243,000 in August – up 115 percent from the year before.
September: Single-family existing home sales decreases 7.5 percent from the previous month – the lowest level in nine years. Median sale price of existing homes fell six percent from the year before.
December: President Bush again warns Congress of the need to pass legislation reforming GSEs, saying "These institutions provide liquidity in the mortgage market that benefits millions of homeowners, and it is vital they operate safely and operate soundly. So I've called on Congress to pass legislation that strengthens independent regulation of the GSEs – and ensures they focus on their important housing mission. The GSE reform bill passed by the House earlier this year is a good start. But the Senate has not acted. And the United States Senate needs to pass this legislation soon." (President George W. Bush, Discusses Housing, The White House, 12/6/07).
2008January: Bank of America announces it will buy Countrywide.
January: Citigroup announces mortgage portfolio lost $18.1 billion in value.
February: Assistant Secretary David Nason reiterates the urgency of reforms, says "A new regulatory structure for the housing GSEs is essential if these entities are to continue to perform their public mission successfully." (David Nason, Testimony On Reforming GSE Regulation, Senate Committee On Banking, Housing And Urban Affairs, 2/7/08).
March: Bear Stearns announces it will sell itself to JPMorgan Chase.
March: President Bush calls on Congress to take action and "move forward with reforms on Fannie Mae and Freddie Mac. They need to continue to modernize the FHA, as well as allow State housing agencies to issue tax-free bonds to homeowners to refinance their mortgages." (President George W. Bush, Remarks To The Economic Club Of New York, New York, NY, 3/14/08).
April: President Bush urges Congress to pass the much needed legislation and "modernize Fannie Mae and Freddie Mac. [There are] constructive things Congress can do that will encourage the housing market to correct quickly by ... helping people stay in their homes." (President George W. Bush, Meeting With Cabinet, the White House, 4/14/08).
May: President Bush issues several pleas to Congress to pass legislation reforming Fannie Mae and Freddie Mac before the situation deteriorates further.
"Americans are concerned about making their mortgage payments and keeping their homes. Yet Congress has failed to pass legislation I have repeatedly requested to modernize the Federal Housing Administration that will help more families stay in their homes, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance sub-prime loans." (President George W. Bush, Radio Address, 5/3/08).
"[T]he government ought to be helping creditworthy people stay in their homes. And one way we can do that – and Congress is making progress on this – is the reform of Fannie Mae and Freddie Mac. That reform will come with a strong, independent regulator." (President George W. Bush, Meeting With The Secretary Of The Treasury, the White House, 5/19/08).
"Congress needs to pass legislation to modernize the Federal Housing Administration, reform Fannie Mae and Freddie Mac to ensure they focus on their housing mission, and allow State housing agencies to issue tax-free bonds to refinance subprime loans." (President George W. Bush, Radio Address, 5/31/08).
June: As foreclosure rates continued to rise in the first quarter, the President once again asks Congress to take the necessary measures to address this challenge, saying "we need to pass legislation to reform Fannie Mae and Freddie Mac." (President George W. Bush, Remarks At Swearing In Ceremony For Secretary Of Housing And Urban Development, Washington, D.C., 6/6/08).
July: Congress heeds the President's call for action and passes reform of Fannie Mae and Freddie Mac as it becomes clear that the institutions are failing.
TOOO LATE!
Apparently ATM and airport kiosks are the reason why our unemployment rate sucks.
http://nation.foxnews.com/president-obama/2011/06/14/obama-blames-atms-high-unemployment
Quote from: guido911 on June 15, 2011, 02:53:15 PM
Apparently ATM and airport kiosks are the reason why our unemployment rate sucks.
http://nation.foxnews.com/president-obama/2011/06/14/obama-blames-atms-high-unemployment
Yes. He's blaming it only on ATM's and airport kiosks.
Look everyone, G's found the answer!!! And it was on Fox news all along!!!
Nice job Fox. Nice job G.
Quote from: guido911 on June 15, 2011, 02:53:15 PM
Apparently ATM and airport kiosks are the reason why our unemployment rate sucks.
http://nation.foxnews.com/president-obama/2011/06/14/obama-blames-atms-high-unemployment
(http://i131.photobucket.com/albums/p309/kallsop2/jaw_dropping_butch.jpg)
Quote from: Conan71 on June 10, 2011, 03:03:29 PM
All fine and good, but can you explain the growth in the economy you said wasn't possible with tax cuts and increased government spending under President Bush?
(http://2.bp.blogspot.com/_QxBGECHecpA/SPT9Xt8pmXI/AAAAAAAAAEM/xyWNl--u2Rs/s400/D.+Consumer+Debt+Outstanding)
2000 about $7,000 billion
2007 about $13,000 billion
6 trillion in debt is a large boost to the economy.
Actually this is not the first time President Obama has mentioned automation as a reason behind a shrinking job market. I agree with him.
But, if your ambition in life is to become a bank teller and you are out of work, it is not the fault of the ATM, it is the fault of your ambition.
If you are a union laborer as your father was and his father and you are replaced by a robot or a person in China, it is not the robot's fault, nor is it Mr. Chin's fault. It is your fault.
I don't believe that President Obama is a Luddite. I don't believe he is actually blaming technology, I simply think that he is bringing to light the fact that it is stupid to think that a portion of the labor pool won't eventually be replaced by automation. The ongoing expense for automation is far less than that of an employee. They don't require benefits, nor is that expense at the will of changing government regulation, taxation, and everything else we can see coming down the pike.
The company I work for sells such automation technology, and the last couple of years has been very successful because companies are fearful of hiring more staff, and if there is a one time investment you can make that will save you from an ongoing expense that is just good business. Cheap labor is no longer cheap, and who knows what it will cost in the next few years?
Go to Carl's Jr. in Bixby and you will notice that they have now replaced the counter staff with touch screen order entry kiosks. Soon you won't even be able to get a job flipping burgers!
Quote from: Gaspar on June 15, 2011, 03:26:17 PM
Actually this is not the first time President Obama has mentioned automation as a reason behind a shrinking job market. I agree with him.
But, if your ambition in life is to become a bank teller and you are out of work, it is not the fault of the ATM, it is the fault of your ambition.
If you are a union laborer as your father was and his father and you are replaced by a robot or a person in China, it is not the robot's fault, nor is it Mr. Chin's fault. It is your fault.
I don't believe that President Obama is a Luddite. I don't believe he is actually blaming technology, I simply think that he is bringing to light the fact that it is stupid to think that a portion of the labor pool won't eventually be replaced by automation. The ongoing expense for automation is far less than that of an employee. They don't require benefits, nor is that expense at the will of changing government regulation, taxation, and everything else we can see coming down the pike.
The company I work for sells such automation technology, and the last couple of years has been very successful because companies are fearful of hiring more staff, and if there is a one time investment you can make that will save you from an ongoing expense that is just good business. Cheap labor is no longer cheap, and who knows what it will cost in the next few years?
Go to Carl's Jr. in Bixby and you will notice that they have now replaced the counter staff with touch screen order entry kiosks. Soon you won't even be able to get a job flipping burgers!
Really... People don't hire them because they are "fearful"? Not because your business provides reliable equipment which can replace workers and save them money?
Quote from: CharlieSheen on June 15, 2011, 03:31:27 PM
Really... People don't hire them because they are "fearful". Not because your business provides reliable equipment which can replace workers and save them money?
"Fearful" of what?
Quote from: Gaspar on June 15, 2011, 03:32:28 PM
"Fearful" of what?
Fearful of hiring people as you mentioned. But then you went on to say that it is "just good business". So either 1) they are fearful of hiring anybody or 2) they would be stupid not to :)
Someone has to flip the burgers, just not take the order.
I've been commenting as far back as a year ago that 9% may just be the new normal for unemployment. That's been primarily based on anecdotal observations of my clients and vendors who have all weathered the economic storm. How many of the 4 to 4.5% jobs lost in the last three to four years were being funded with borrowed money in the first place. Many businesses have closed and those who are going great guns have learned to do more with fewer resources and much lower inventory levels.
Quote from: CharlieSheen on June 15, 2011, 03:21:44 PM
(http://2.bp.blogspot.com/_QxBGECHecpA/SPT9Xt8pmXI/AAAAAAAAAEM/xyWNl--u2Rs/s400/D.+Consumer+Debt+Outstanding)
2000 about $7,000 billion
2007 about $13,000 billion
6 trillion in debt is a large boost to the economy.
That's certainly a factor but that's consumer borrowing, not government spending. I've still not seen the metric which proves government spending provided lasting solutions to a recession.
Take a look at 1992 to 2007 and it's clear what an orgy we had going on. Doubled from '92 to '2000 then again through the first six years of the Bush admin. Had to have been really good for the construction industry as well as all the consumer goods and cars being financed on lines of credit secured by 2nd mortgages.
Thanks for the graphic, Sheen.
Quote from: Conan71 on June 15, 2011, 03:41:28 PM
That's certainly a factor but that's consumer borrowing, not government spending. I've still not seen the metric which proves government spending provided lasting solutions to a recession.
Take a look at 1992 to 2007 and it's clear what an orgy we had going on. Doubled from '92 to '2000 then again through the first six years of the Bush admin. Had to have been really good for the construction industry as well as all the consumer goods and cars being financed on lines of credit secured by 2nd mortgages.
Thanks for the graphic, Sheen.
Skipped over the government spending. However, one thing i missed was the fact that most of that mortgage debt was backed by the government. So yeah, government "spending" on person debt fueled the economy. The Bush government spending bonanza was just to give your buddies a scratch on the back for getting you in office. And no, the spending increases were NOT due to the wars in Afghanistan or Iraq. It was way more than that (this wasn't directed to Conan).
I think the US should try to be the "high tech" leader in the world and work to get the highest paying jobs. The total population of the US is only about 5% of the entire worlds population. Theoretically a large chunk of our population could have a good number of the worlds highest paying jobs. We could all be the rich.
How do we capture the majority of those jobs? It seems like a lot of northern European countries have headed down that course. In the global scheme of things, we are a small country that could do that too.
The other type of jobs that will do well in the future will be things done locally and of high quality, perhaps that can be hand made, and that are done to be custom. Each locality in the world will branch out in two directions, one being the exact opposite of high tech, a reversal of sorts going back to the old days, like the village craftsman, where quality craftsmanship from food and wine, to cabinetry, even super high quality machine parts for cars or watches, quality toys, unique local quisine, local art, (Germany is good at doing this) etc. will do quite well. I can't compete with a mass produced print from China that people all over the world will buy, but I can do a unique, high quality, custom made painting for you or a mural in your home.
Another type of industry will be the "experience" industry. So much is so cheap these days. Most Americans have piles of stuff, clothing, etc. out their wazoos. Or we may end up in a world where the opposite might be true where people can't afford or don't want a lot of things. Regardless, seems to me that more things aren't going to be as important as having more experiences. We will divide up a good many of our purchases into technology and "brick and mortar" experiences. Could be a great dining experience, movie experience, vacation,,, or I hope some day a great Museum experience, and not what you typically mean by say a dining "experience", you will make it if you can offer something that gives you a unique, interesting, bonafied, great e-x-p-e-r-i-e-n-c-e. You won't just be selling or competing with the food, you will also more and more be selling and competing with the experiences. Hope you get my drift. In essence, You will have people buying technology and spending a lot of time in that world (online like us here lol, gaming, movies/entertainment, work, news and information), then also people wanting good experiences in the "brick and mortar" world. (and I would say that runs into whether your city itself will offer a good experience, with pleasing pedestrian friendly streets for instance).
Well so much for locking spammers out of being able to start topics as a solution.
Is there any way to identify foreign IP's and block them?
Quote from: Conan71 on June 17, 2011, 12:16:05 AM
Well so much for locking spammers out of being able to start topics as a solution.
Is there any way to identify foreign IP's and block them?
How bout just foreigners?
/I keed, I keed.
Quote from: we vs us on June 17, 2011, 06:35:43 AM
How bout just foreigners?
/I keed, I keed.
No, I think you would have to include Journey and Starship too.
Quote from: Conan71 on June 17, 2011, 08:39:38 AM
No, I think you would have to include Journey and Starship too.
Don't forget April Wine, those darn Canadiens.........
Quote from: dbacks fan on June 17, 2011, 09:52:57 AM
Don't forget April Wine, those darn Canadiens.........
Those Canadians can be fun...they know to topple cars and burn stuff....
Quote from: Hoss on June 17, 2011, 10:10:14 AM
Those Canadians can be fun...they know to topple cars and burn stuff....
and use their time in a riot wisely...
(http://a.abcnews.com/images/Technology/gty_vancouver_riot_dm_110617_wg.jpg)
Quote from: Townsend on June 17, 2011, 10:14:15 AM
and use their time in a riot wisely...
(http://a.abcnews.com/images/Technology/gty_vancouver_riot_dm_110617_wg.jpg)
Saw that last night and was floored. Pretty funny.
OUCH!
"Among the major worker groups, the unemployment rates for adult men (8.9 percent),
adult women (8.0 percent), teenagers (24.2 percent), whites (8.0 percent), blacks
(16.2 percent), and Hispanics (11.9 percent) showed little or no change in May. The
jobless rate for Asians was 7.0 percent, not seasonally adjusted. (See tables A-1,
A-2, and A-3.)
In May, the number of long-term unemployed (those jobless for 27 weeks and over)
increased by 361,000 to 6.2 million; their share of unemployment increased to 45.1
percent. (See table A-12.)"
http://www.bls.gov/news.release/empsit.nr0.htm
I was watching CBS news earlier this evening, I cannot recall the city, but black unemployment is over 30%. At some point one has to think black Americans, who were very convinced their lives would improve under President Obama, are beginning to realize he's not one of them. I mean sure, same skin color and he purports to know their culture, but let's look at his life. He was raised in a white family going to private schools and the best universities. What does he really understand about the economic realities of poor black family? How much does he really have in common with a 50 year old under-skilled black male laborer who cannot find a job or a laid off union machinist for that matter?
Quote from: Conan71 on June 20, 2011, 07:29:25 PM
I was watching CBS news earlier this evening, I cannot recall the city, but black unemployment is over 30%. At some point one has to think black Americans, who were very convinced their lives would improve under President Obama, are beginning to realize he's not one of them. I mean sure, same skin color and he purports to know their culture, but let's look at his life. He was raised in a white family going to private schools and the best universities. What does he really understand about the economic realities of poor black family? How much does he really have in common with a 50 year old under-skilled black male laborer who cannot find a job or a laid off union machinist for that matter?
Am I going to have to bust out the R word here? I mean, the fact that blacks will vote for someone based solely on skin color. Oh wait, now I'm being racist. Guido:
(http://s3.amazonaws.com/kym-assets/entries/icons/original/000/002/135/sw50sw8sw578.gif?1293729577)
This racism stuff can be so confusing sometimes. Seriously, though (for Townsend's sake), those stats are quite astonishing.
Quote from: Conan71 on June 20, 2011, 07:29:25 PM
What does he really understand about the economic realities of poor black family?
Probably as much or more than any of the 43 Presidents before him.
If that is a duty of the job, every President in history fails.
Quote from: Conan71 on June 20, 2011, 07:29:25 PM
I was watching CBS news earlier this evening, I cannot recall the city, but black unemployment is over 30%. At some point one has to think black Americans, who were very convinced their lives would improve under President Obama, are beginning to realize he's not one of them. I mean sure, same skin color and he purports to know their culture, but let's look at his life. He was raised in a white family going to private schools and the best universities. What does he really understand about the economic realities of poor black family? How much does he really have in common with a 50 year old under-skilled black male laborer who cannot find a job or a laid off union machinist for that matter?
Yeah, the employment situation for black people sucks even more than that of white people. Why? Because black people are disproportionately likely to be poor and less educated, both of which have a strong correlation with unemployment. Also, the age demos are quite different for black people relative to white people, which again works against them as a group (Median age is about 7 years less than white people).
Basically, a given black person is more likely to be poor, uneducated, and young. Since unemployment is highest among people falling into those categories, it would be..suspicious..if the unemployment rate among black people weren't significantly higher than that of white people.
Quote from: guido911 on June 20, 2011, 07:40:44 PM
This racism stuff can be so confusing sometimes. Seriously, though (for Townsend's sake), those stats are quite astonishing.
Aw, you just keep trying. Not much of an attempt though. Let's see how you do on the next one.
Congrats and kudos to Guido for calling Conan a spade! :D
Conan, I read between your lines and they say "POTUS OBAMA FAIL" (but the country knows the republicans placed us here).
Quote from: Teatownclown on June 21, 2011, 12:10:26 AM
Congrats and kudos to Guido for calling Conan a spade! :D
Conan, I read between your lines and they say "POTUS OBAMA FAIL" (but the country knows the republicans placed us here).
So let me see if I understand. . .it was the Republican's fault that President Obama was elected.
I can agree with that.
Quote from: Conan71 on June 20, 2011, 07:29:25 PM
OUCH!
"Among the major worker groups, the unemployment rates for adult men (8.9 percent),
adult women (8.0 percent), teenagers (24.2 percent), whites (8.0 percent), blacks
(16.2 percent), and Hispanics (11.9 percent) showed little or no change in May. The
jobless rate for Asians was 7.0 percent, not seasonally adjusted. (See tables A-1,
A-2, and A-3.)
In May, the number of long-term unemployed (those jobless for 27 weeks and over)
increased by 361,000 to 6.2 million; their share of unemployment increased to 45.1
percent. (See table A-12.)"
http://www.bls.gov/news.release/empsit.nr0.htm
I was watching CBS news earlier this evening, I cannot recall the city, but black unemployment is over 30%. At some point one has to think black Americans, who were very convinced their lives would improve under President Obama, are beginning to realize he's not one of them. I mean sure, same skin color and he purports to know their culture, but let's look at his life. He was raised in a white family going to private schools and the best universities. What does he really understand about the economic realities of poor black family? How much does he really have in common with a 50 year old under-skilled black male laborer who cannot find a job or a laid off union machinist for that matter?
It was Milwaukee WI. Most of them had lost good paying jobs in the mfg sector, where the norm used to be you could graduate highschool and go to work making good money.
QuoteSmith is part of a staggering problem. The city of Milwaukee lost 56,000 jobs in the recession, many in manufacturing, which used to provide entry-level employment.
Just 40 years ago, 8 out of 10 black men were employed. Most found jobs in manufacturing, where a kid coming out of high school used to be able to earn a decent wage and support a family, but not anymore.
Now, Milwaukee has begun a new program which matches high school drop-outs, low-skilled workers, even some ex-felons, with businesses willing to train them. For six months, men like Darius Smith are paid to learn carpentry or electrical installation skills.
http://www.cbsnews.com/stories/2011/06/20/eveningnews/main20072738.shtml?tag=mncol;lst;2 (http://www.cbsnews.com/stories/2011/06/20/eveningnews/main20072738.shtml?tag=mncol;lst;2)
Quote from: RecycleMichael on June 20, 2011, 08:40:32 PM
Probably as much or more than any of the 43 Presidents before him.
If that is a duty of the job, every President in history fails.
And that's been an issue within black communities prior to Candidate Obama. He was their Messiah. He was going to make sure they all had jobs, they wouldn't have to worry about how they were going to buy gas or make their house payment (roll tape Guido), or health care. He was going to take care of his people cradle-to-the grave.
I think they are slowly figuring out he's got far more in common with the white oligarchy in the country than he does with the average black person.
I'd go so far as to say Presidents Clinton and Carter knew far more what it was to come from a disadvantaged or humble home than President Obama.
Quote from: Conan71 on June 21, 2011, 10:01:08 AM
He was their Messiah. He was going to make sure they all had jobs, they wouldn't have to worry about how they were going to buy gas or make their house payment (roll tape Guido), or health care. He was going to take care of his people cradle-to-the grave.
Man, you like deep holes.....
Quote from: Conan71 on June 21, 2011, 10:01:08 AM
And that's been an issue within black communities prior to Candidate Obama. He was their Messiah. He was going to make sure they all had jobs, they wouldn't have to worry about how they were going to buy gas or make their house payment (roll tape Guido), or health care. He was going to take care of his people cradle-to-the grave.
I think they are slowly figuring out he's got far more in common with the white oligarchy in the country than he does with the average black person.
I'd go so far as to say Presidents Clinton and Carter knew far more what it was to come from a disadvantaged or humble home than President Obama.
According to NPR, "He's not their boyfriend anymore"
http://www.npr.org/2011/06/17/137238072/liberal-bloggers-obama-not-our-boyfriend-anymore?ft=1&f=1001
My favorite part of that:
"I honest to God thought I was voting for these guys and that it was going to be the first time in my lifetime that I'm finally in a position of power, where I could be working with the White House on a regular basis, saying, 'OK what could we do this year on gay stuff?' Wouldn't it be cool, oh, 'Don't ask, don't tell,' this is great.' "
Quote from: Teatownclown on June 21, 2011, 10:05:54 AM
Man, you like deep holes.....
Really? Tell me which part I missed on that. Do you disagree President Obama has far more in common with white Elitists than working class blacks?
He's certainly associated far more with the white elitists his entire life.
Quote from: Conan71 on June 21, 2011, 10:01:08 AM
And that's been an issue within black communities prior to Candidate Obama. He was their Messiah. He was going to make sure they all had jobs, they wouldn't have to worry about how they were going to buy gas or make their house payment (roll tape Guido), or health care. He was going to take care of his people cradle-to-the grave.
I think they are slowly figuring out he's got far more in common with the white oligarchy in the country than he does with the average black person.
I'd go so far as to say Presidents Clinton and Carter knew far more what it was to come from a disadvantaged or humble home than President Obama.
"they all had jobs, they wouldn't have to worry about how they were going to buy gas or make their house payment "
Way to stereotype an entire race based on a youtube video of one or two people.
Quote from: CharlieSheen on June 21, 2011, 10:47:32 AM
"they all had jobs, they wouldn't have to worry about how they were going to buy gas or make their house payment "
Way to stereotype an entire race based on a youtube video of one or two people.
No, that was the message of "hope" and "change". The message he took to those neighborhoods was one that he was going to make sure their needs and issues were taken care of and addressed. How's that worked out so far?
This part is the hole:
Quote"And that's been an issue within black communities prior to Candidate Obama. He was their Messiah. He was going to make sure they all had jobs, they wouldn't have to worry about how they were going to buy gas or make their house payment (roll tape Guido), or health care. He was going to take care of his people cradle-to-the grave."
That's a little heavy handed, don't you think? Name anyone besides that one Youtube street chick #1 who was expecting anything resembling a free ride. Did Al Sharpton say anything in that vein? Or Jesse Jackson? How about Jim Clyburn, or Harold Ford or Jesse Jackson Jr.? Anyone on the Congressional Black Caucus, or in the Rainbow Coalition, or the NAACP, or any other prominent politically active orgs? Anyone say anything remotely like that besides random street chick #1? How about even Maxine Waters? She's TOTALLY whacked, and yet she hasn't said anything about free housing and free healthcare and free food and free free free.
If you look at the African American power structure, they have all been cautiously optimistic about Obama's presidency -- hell, his candidacy! -- from day one. There's never been a sense that anything will get easier. Maybe rightwing radio is saying stuff like this but if you actually listen to African American leaders speak, you'll hear that hesitancy.
Like I said before, the left IS pissed at Obama -- and the NPR article is legit -- because he's left a lot of things on the table and compromised when he didn't have to. He gave away a lot and got nothing in return, which hasn't endeared him to his base. On the other hand -- and I say this as a disgruntled Dem -- there's nowhere else to go. There's no way anyone on the GOP side is going to offer anything close to adult supervision. And honestly, even if a moderate like Huntsman or Romney gets elected, they'll be so beholden to the whackadoos that even if they have moderate impulses, they'll be pushed farther right every time.
So I -- much like the gayfolk, the African Americans, the Hispanics, the environmentalists, the anti-capitalists, the euro-socialists, the anti-torture, anti-security state, anti-surveillance, anti-war, anti-banking, anti plutocratic-order activists -- will vote enthusiastically for someone I'm lukewarm about because to vote the alternative is madness.
Quote from: we vs us on June 21, 2011, 11:15:54 AM
This part is the hole:
That's a little heavy handed, don't you think? Name anyone besides that one Youtube street chick #1 who was expecting anything resembling a free ride. Did Al Sharpton say anything in that vein? Or Jesse Jackson? How about Jim Clyburn, or Harold Ford or Jesse Jackson Jr.? Anyone on the Congressional Black Caucus, or in the Rainbow Coalition, or the NAACP, or any other prominent politically active orgs? Anyone say anything remotely like that besides random street chick #1? How about even Maxine Waters? She's TOTALLY whacked, and yet she hasn't said anything about free housing and free healthcare and free food and free free free.
If you look at the African American power structure, they have all been cautiously optimistic about Obama's presidency -- hell, his candidacy! -- from day one. There's never been a sense that anything will get easier. Maybe rightwing radio is saying stuff like this but if you actually listen to African American leaders speak, you'll hear that hesitancy.
Like I said before, the left IS pissed at Obama -- and the NPR article is legit -- because he's left a lot of things on the table and compromised when he didn't have to. He gave away a lot and got nothing in return, which hasn't endeared him to his base. On the other hand -- and I say this as a disgruntled Dem -- there's nowhere else to go. There's no way anyone on the GOP side is going to offer anything close to adult supervision. And honestly, even if a moderate like Huntsman or Romney gets elected, they'll be so beholden to the whackadoos that even if they have moderate impulses, they'll be pushed farther right every time.
So I -- much like the gayfolk, the African Americans, the Hispanics, the environmentalists, the anti-capitalists, the euro-socialists, the anti-torture, anti-security state, anti-surveillance, anti-war, anti-banking, anti plutocratic-order activists -- will vote enthusiastically for someone I'm lukewarm about because to vote the alternative is madness.
They call that "the lesser of two (or eight) evils"..
Quote from: we vs us on June 21, 2011, 11:15:54 AM
This part is the hole:
That's a little heavy handed, don't you think? Name anyone besides that one Youtube street chick #1 who was expecting anything resembling a free ride. Did Al Sharpton say anything in that vein? Or Jesse Jackson? How about Jim Clyburn, or Harold Ford or Jesse Jackson Jr.? Anyone on the Congressional Black Caucus, or in the Rainbow Coalition, or the NAACP, or any other prominent politically active orgs? Anyone say anything remotely like that besides random street chick #1? How about even Maxine Waters? She's TOTALLY whacked, and yet she hasn't said anything about free housing and free healthcare and free food and free free free.
If you look at the African American power structure, they have all been cautiously optimistic about Obama's presidency -- hell, his candidacy! -- from day one. There's never been a sense that anything will get easier. Maybe rightwing radio is saying stuff like this but if you actually listen to African American leaders speak, you'll hear that hesitancy.
Like I said before, the left IS pissed at Obama -- and the NPR article is legit -- because he's left a lot of things on the table and compromised when he didn't have to. He gave away a lot and got nothing in return, which hasn't endeared him to his base. On the other hand -- and I say this as a disgruntled Dem -- there's nowhere else to go. There's no way anyone on the GOP side is going to offer anything close to adult supervision. And honestly, even if a moderate like Huntsman or Romney gets elected, they'll be so beholden to the whackadoos that even if they have moderate impulses, they'll be pushed farther right every time.
So I -- much like the gayfolk, the African Americans, the Hispanics, the environmentalists, the anti-capitalists, the euro-socialists, the anti-torture, anti-security state, anti-surveillance, anti-war, anti-banking, anti plutocratic-order activists -- will vote enthusiastically for someone I'm lukewarm about because to vote the alternative is madness.
Exactly! (Apologies to Gaspar)
Of course it's heavy-handed. I hope you realize I used the dumbass woman to bring a little hyperbole and absurdity into the discussion. The reason black America was excited at the possibility there finally would be a black major party candidate had so little to do with the color of his skin. Sure, there was the historical aspect of helping to elect the first black president, but what was the relevance of one of their own finally getting to the most powerful seat in the world? They pinned a lot of hope on this candidate that blacks would
finally get a leg up on new jobs, new business opportunities in their communities, better education, disappearing blight and crime.
Has much, if any of that, come to fruition under the Obama Administration?
I loved the government statistics Recyclemichael posted last week showing that black-owned business enterprises had increased by 60%- from 2002 to 2007!!!! Genuine proof that Bush hated blacks and Bush era policies were so bad for African Americans. Just goes to show how little perception has to do with reality in politics.
Quote from: we vs us on June 21, 2011, 11:15:54 AM
So I -- much like the gayfolk, the African Americans, the Hispanics, the environmentalists, the anti-capitalists, the euro-socialists, the anti-torture, anti-security state, anti-surveillance, anti-war, anti-banking, anti plutocratic-order activists -- will vote enthusiastically for someone I'm lukewarm about because to vote the alternative is madness.
A focus on social issues over ability to lead is madness. All of the above groups placed higher importance on their marginal social issues than they did on economic issues.
There is no social justice in a failing economy! This goes back to my previous analogy about re-arranging deck chairs as the titanic sinks. Candidate Obama was beholden to these groups and their agendas to get elected. Once in office he had to face the reality that everything he promised required funding, and therefore a stable economy and tax base for fuel. The problem was that he was immensely experienced in dealing with social issues but had zero economic experience. He was incapable of making good on any of these promises because he was incapable of providing economic stability. His audacity prevented him from seeking any appropriate help in the matter, so he surrounded himself with academics who matched his social philosophy rather than innovators with experience.
As president, there are few issues more important than the economy. I am happy to vote for a president who doesn't give a smile about who marries who, or what color you are, or whether you like to butter your bread on the top or the bottom. I'll let my representatives hash out those issues.
If we continue framing our Commander in Chief solely by how he/she reacts to social questions, rather than their ability to lead, we will continue to get more President Obamas. . .leading from behind.
Quote from: Gaspar on June 21, 2011, 01:08:50 PM
A focus on social issues over ability to lead is madness. All of the above groups placed higher importance on their marginal social issues than they did on economic issues.
There is no social justice in a failing economy! This goes back to my previous analogy about re-arranging deck chairs as the titanic sinks. Candidate Obama was beholden to these groups and their agendas to get elected. Once in office he had to face the reality that everything he promised required funding, and therefore a stable economy and tax base for fuel. The problem was that he was immensely experienced in dealing with social issues but had zero economic experience. He was incapable of making good on any of these promises because he was incapable of providing economic stability. His audacity prevented him from seeking any appropriate help in the matter, so he surrounded himself with academics who matched his social philosophy rather than innovators with experience.
As president, there are few issues more important than the economy. I am happy to vote for a president who doesn't give a smile about who marries who, or what color you are, or whether you like to butter your bread on the top or the bottom. I'll let my representatives hash out those issues.
If we continue framing our Commander in Chief solely by how he/she reacts to social questions, rather than their ability to lead, we will continue to get more President Obamas. . .leading from behind.
You have already established that the problem is a "feeling". That when Obama cuts their taxes it doesn't count. So he did what he could and extended the Republican fixes started by Bush. Threw in some of his own. It was pretty obvious that the greatest decline in the US since the great depression doesn't turn around in four years. I think we will be lucky to be out of it in 2016 too.
Gaspar, need I remind you once again that the massive tax increases have been coming from the states, and not the federal government? I know it doesn't give you ammunition to use against Obama, but you should at least try to keep the facts in mind.
Quote from: nathanm on June 21, 2011, 01:24:35 PM
Gaspar, need I remind you once again that the massive tax increases have been coming from the states, and not the federal government? I know it doesn't give you ammunition to use against Obama, but you should at least try to keep the facts in mind.
Did I say something about massive tax increases? Did I even mention tax increases?
It appears you have a different dialogue going on in your head.
Quote from: Gaspar on June 21, 2011, 01:08:50 PM
A focus on social issues over ability to lead is madness. All of the above groups placed higher importance on their marginal social issues than they did on economic issues.
There is no social justice in a failing economy! This goes back to my previous analogy about re-arranging deck chairs as the titanic sinks. Candidate Obama was beholden to these groups and their agendas to get elected. Once in office he had to face the reality that everything he promised required funding, and therefore a stable economy and tax base for fuel. The problem was that he was immensely experienced in dealing with social issues but had zero economic experience. He was incapable of making good on any of these promises because he was incapable of providing economic stability. His audacity prevented him from seeking any appropriate help in the matter, so he surrounded himself with academics who matched his social philosophy rather than innovators with experience.
As president, there are few issues more important than the economy. I am happy to vote for a president who doesn't give a smile about who marries who, or what color you are, or whether you like to butter your bread on the top or the bottom. I'll let my representatives hash out those issues.
If we continue framing our Commander in Chief solely by how he/she reacts to social questions, rather than their ability to lead, we will continue to get more President Obamas. . .leading from behind.
Actually, as Conan points out, each of these groups has very real economic concerns and especially for these groups the are inseparable from the "social justice" issues.
I don't think I disagree overall with your point, which I THINK is that in this situation, the macro concerns trump the micro -- ie. get the whole thing working again rather than tweaking at the margins -- but the rest of your characterization is bunk. Obama didn't make up his policy response on his own, in a shed, in the dark, with no other input. He had a very credentialed, experienced team working with him. They made policy choices based on their interpretations of solid information. You keep insisting that the economic problems are somehow results of Obama's character failings, when in fact they were policies which didn't fully work. That's it. Obama's neither evil nor stupid nor lazy, nor even a particularly bad executive. He's been able to advance an agenda in the face of a barking mad opposition party that has nothing but the crazy at it's center (certainly not any actual sets of policy provisions). But he hasn't failed because he did nothing or acted stupidly. He chose a course of action that wasn't strong enough and was more geared toward compromise than it should have been.
Quote from: we vs us on June 21, 2011, 01:46:05 PM
Actually, as Conan points out, each of these groups has very real economic concerns and especially for these groups the are inseparable from the "social justice" issues.
I don't think I disagree overall with your point, which I THINK is that in this situation, the macro concerns trump the micro -- ie. get the whole thing working again rather than tweaking at the margins -- but the rest of your characterization is bunk. Obama didn't make up his policy response on his own, in a shed, in the dark, with no other input. He had a very credentialed, experienced team working with him. They made policy choices based on their interpretations of solid information. You keep insisting that the economic problems are somehow results of Obama's character failings, when in fact they were policies which didn't fully work. That's it. Obama's neither evil nor stupid nor lazy, nor even a particularly bad executive. He's been able to advance an agenda in the face of a barking mad opposition party that has nothing but the crazy at it's center (certainly not any actual sets of policy provisions). But he hasn't failed because he did nothing or acted stupidly. He chose a course of action that wasn't strong enough and was more geared toward compromise than it should have been.
He surrounded himself with very credentialed academics with minimal private sector experience:
Timothy Geithner
Lawrence Summers
Jared Bernstein
Jason Furman
Christina Romer
Melody Barnes
Peter Orszag
Austan Goolsbee
He embraced Keynesian economic principals that work well in a class room but do not pan out in reality because human beings do not react as simple Keynesian variables.
He appointed "blue ribbon panels," but when they came back with advice that echoed what the private sector was saying he opted to dismiss it rather than adopt it.
His economic policies are rock solid. Unfortunately, they are dead wrong.
Those who have resigned are beginning to rumble about his choices. Christina Romer has become the most vocal. I'm sure part of this is to try and reestablish some sort of credibility among her peers, but it is telling none the less. The others will tell their tales soon.
I personally like the "Obama Stash" recording:
But o/t, here is a very interesting report that kinda shines a light on why about 95% of blacks voted for Obama.
Did 95% of whites go for McCain?
Quote from: Gaspar on June 21, 2011, 02:04:12 PM
He embraced Keynesian economic principals that work well in a class room but do not pan out in reality because human beings do not react as simple Keynesian variables.
Keynesian economics saved our bacon during the Great Depression. Which reality are YOU talking about?
Quote from: we vs us on June 21, 2011, 02:12:51 PM
Keynesian economics saved our bacon during the Great Depression. Which reality are YOU talking about?
World War II had nothing to do with it?
Quote from: guido911 on June 21, 2011, 02:21:17 PM
World War II had nothing to do with it?
Well, if you want to talk about Keynesian stimulus, that'd be a prime example. Nothing like using massive government borrowing to stimulate the war industry.
Quote from: we vs us on June 21, 2011, 02:33:06 PM
Well, if you want to talk about Keynesian stimulus, that'd be a prime example. Nothing like using massive government borrowing to stimulate the war industry.
Oh THAT'S what you meant about Keynesian stimulus, government spending to defend itself from foreign enemies and not all that early Keynesian stimulus that took place the numerous years preceding it. Quick, someone call Obama and tell him to increase military spending 1,000%. Where is my backpedaling image when I need it?
edited.
Quote from: we vs us on June 21, 2011, 02:12:51 PM
Keynesian economics saved our bacon during the Great Depression. Which reality are YOU talking about?
Economics is a social science, not a physical one, in which people and systems are constantly adapting to changing conditions. The policies that may be good for one era may not be right for the next. And it is the truly great economists who spot the changing dynamics, acknowledge the inadequacy of the old prescriptions and are clever enough to come up with something better.
In the 20/30s our workforce was far less entrepreneurial and far more "workforce" related. Industry in the United States was production driven. We were a nation of factories and factory workers. The Keynesian model was a far better fit.
We've changed, and for the better. We live at the other end of the spectrum. We have some great expamples of how the two competing philosophies (Keynsian vs. Freedman/Mises) work in the modern world. Carter's path to stagflation, and Obama's stagsession offer a deep contrast to Kenedy's and Regan's modern approach.
In a world where everyone is invested, and small business employment outnumbers big business, our economy only realizes temporary fluctuation through stimulus spending. Long term growth is achieved through free trade policies, and free market approaches.
Government is no longer the coach, it is the referee.
Here's a sad reminder. . .
This is a transcript from yesterday's DNC event. This is the President's address at the event.
Do a word search for private sector Jobs. Read the sentence and the reaction of the DNC crowd.
Quote from: Gaspar on June 21, 2011, 02:39:29 PM
Economics is a social science, not a physical one . . . .
etc
etc
Or we can ignore all that folderol and listen to Bill Gross, the head of PIMCO (the bond traders!) in his July letter to investors (bolds are his):
http://www.pimco.com/EN/Insights/Pages/School-Daze-School-Daze-Good-Old-Golden-Rule-Days.aspx
QuoteSolutions from policymakers on the right or left, however, seem focused almost exclusively on rectifying or reducing our budget deficit as a panacea. While Democrats favor tax increases and mild adjustments to entitlements, Republicans pound the table for trillions of dollars of spending cuts and an axing of Obamacare. Both, however, somewhat mystifyingly, believe that balancing the budget will magically produce 20 million jobs over the next 10 years. President Obama's long-term budget makes just such a claim and Republican alternatives go many steps further. Former Governor Pawlenty of Minnesota might be the Republicans' extreme example, but his claim of 5% real growth based on tax cuts and entitlement reductions comes out of left field or perhaps the field of dreams. The United States has not had a sustained period of 5% real growth for nearly 60 years.
Both parties, in fact, are moving to anti-Keynesian policy orientations, which deny additional stimulus and make rather awkward and unsubstantiated claims that if you balance the budget, "they will come." It is envisioned that corporations or investors will somehow overnight be attracted to the revived competitiveness of the U.S. labor market: Politicians feel that fiscal conservatism equates to job growth. It's difficult to believe, however, that an American-based corporation, with profits as its primary focus, can somehow be wooed back to American soil with a feeble and historically unjustified assurance that Social Security will be now secure or that medical care inflation will disinflate. Admittedly, those are long-term requirements for a stable and healthy economy, but fiscal balance alone will not likely produce 20 million jobs over the next decade. The move towards it, in fact, if implemented too quickly, could stultify economic growth. Fed Chairman Bernanke has said as much, suggesting the urgency of a congressional medium-term plan to reduce the deficit but that immediate cuts are self-defeating if they were to undercut the still-fragile economy.
By all means, read the whole letter.
So one of the US's major bondholders is calling for additional and immediate deficit spending. In the Keynesian mode, I might point out.
In other words, one of our creditors is asking us to borrow-n-spend. Awful, isn't it?
My credit card company does the same thing. They even send me checks.
Crazy!
BTW, I know who Gross is. He acted as a lobbiest for the government takeover of Fannie and Freddy. In the deal he made something like $1.74 billion dollars.
Like Soros, he is a champion of economic failure and makes his fortunes betting on it.
Quote from: Gaspar on June 21, 2011, 02:39:29 PM
Government is no longer the coach, it is the referee.
Sorry Buster, but you got it backasswards.
The other posties are spewing trickle down thinking as usual....except Nate and We vs Us.
Given the current climate, what can Obama do? The FDR template is not even slightly likely. If for no other reason than that direct hiring by the USGovt has been demonized by the Right and the Left as another Bailout or wasteful spending or picking winners and losers or wrong priorities or some other whine...it's exactly what has happened to every direct injection of funding into government projects that would hire people.
And it does no good to point out that Obama's programs saved upwards of 2 million jobs so far or that he prevented the crash from being worse, those details get glossed over. He has to magically create 10 million jobs this year, by somehow bumping the private sector (since that's the only acceptable source of "Real Jobs").
And the Corporatist private sector has a vested interest, clearly stated, in removing Obama and the Democrats from power and installing Republicans. So they bide their time, sit on their cash reserves and complain about the lousy business climate and how Obama is anti-business, anti-jobs, anti worker, anti-American. And all of this is trumpeted and echoed incessantly, by the Corporate Media.
How does Obama counter that? How do the Democrats turn that around?
read up:The White Working Class: The Group That Will Likely Decide Obama's Fate
http://www.tnr.com/article/politics/90241/obama-election-2012-working-class-kerry
Quote from: Gaspar on June 21, 2011, 02:55:04 PM
My credit card company does the same thing. They even send me checks.
Crazy!
Trust me. PIMCO ain't about to extend you, me, or anyone we know a line of credit. And they will not be sending you checks, either.
So, we've established that you won't listen to or have hostility towards the ideas of: economists, politicians, capitalists, investors, and academics. Who's left?
Quote from: we vs us on June 21, 2011, 02:59:56 PM
Trust me. PIMCO ain't about to extend you, me, or anyone we know a line of credit. And they will not be sending you checks, either.
So, we've established that you won't listen to or have hostility towards the ideas of: economists, politicians, capitalists, investors, and academics. Who's left?
On the contrary, I admire the opinions of these people.
BTW, I know who Gross is. He acted as a lobbiest for the government takeover of Fannie and Freddy. In the deal he made something like $1.74 billion dollars.
Like Soros, he is a champion of economic failure and makes his fortunes betting on it.
Quote from: Gaspar on June 21, 2011, 03:04:54 PM
On the contrary, I admire the opinions of these people.
BTW, I know who Gross is. He acted as a lobbiest for the government takeover of Fannie and Freddy. In the deal he made something like $1.74 billion dollars.
Like Soros, he is a champion of economic failure and makes his fortunes betting on it.
Interesting. His brain thrust is one ex Tulsan: Bob Greer an ex TU research analyst.
I think you have Gross confused with Paulson. Soros made his fortune and seems more devoted to giving others a hand up.
Quote from: we vs us on June 21, 2011, 02:52:49 PM
Or we can ignore all that folderol and listen to Bill Gross, the head of PIMCO (the bond traders!) in his July letter to investors (bolds are his):
http://www.pimco.com/EN/Insights/Pages/School-Daze-School-Daze-Good-Old-Golden-Rule-Days.aspx
By all means, read the whole letter.
So one of the US's major bondholders is calling for additional and immediate deficit spending. In the Keynesian mode, I might point out.
In other words, one of our creditors is asking us to borrow-n-spend. Awful, isn't it?
You know why balanced budgets and reducing the debt and deficit spending is important?
It's a confidence issue. How much confidence do you have in a country which ostensibly went from projected surpluses to being $14 trillion in debt? Anecdotally, there's trillions of dollars in money and assets sitting on the sidelines right now which belongs to corporations and individuals. Who in their right mind wants to invest when the government is creating unfriendly regulatory and taxation issues? Why would you invest when you don't see responsible spending on the part of the government? Why not just shelter the money in other havens around the world who are business friendly and who do have their financial house in order?
I have no confidence in the political party that forced us into this corner.....you sound like a broken record.
Quote from: Teatownclown on June 21, 2011, 03:15:10 PM
Interesting. His brain thrust is one ex Tulsan: Bob Greer an ex TU research analyst.
I think you have Gross confused with Paulson. Soros made his fortune and seems more devoted to giving others a hand up.
Nope, no confusion.
Quote from: Teatownclown on June 21, 2011, 03:21:50 PM
I have no confidence in the political party that forced us into this corner.....you sound like a broken record.
By your logic, apparently U.S. business doesn't care for the party in the White House or the majority in the Senate, it would appear.
Was it a political party or an entirely corrupt political system? Take a closer look at who (Dodd, Frank, et al) was looking the other way while accepting hefty campaign donations and sweet mortgages from those they purported to regulate.
By and large the big Wall Street donors are (D). Weren't they the ones who drove us off into this mess in the first place with their screwy maze of derivatives?
Quote from: Conan71 on June 21, 2011, 03:20:01 PM
You know why balanced budgets and reducing the debt and deficit spending is important?
It's a confidence issue. How much confidence do you have in a country which ostensibly went from projected surpluses to being $14 trillion in debt? Anecdotally, there's trillions of dollars in money and assets sitting on the sidelines right now which belongs to corporations and individuals. Who in their right mind wants to invest when the government is creating unfriendly regulatory and taxation issues? Why would you invest when you don't see responsible spending on the part of the government? Why not just shelter the money in other havens around the world who are business friendly and who do have their financial house in order?
But Conan,
In the Keynesian model this would not matter, because there is no variable for "confidence".
Quote from: Gaspar on June 21, 2011, 03:29:41 PM
But Conan,
In the Keynesian model this would not matter, because there is no variable for "confidence".
As I've always said, Keynes never created a job either. Economic theory doesn't take into account human behavior. Theory doesn't create inertia.
Quote from: Conan71 on June 21, 2011, 03:20:01 PM
It's a confidence issue. How much confidence do you have in a country which ostensibly went from projected surpluses to being $14 trillion in debt? Anecdotally, there's trillions of dollars in money and assets sitting on the sidelines right now which belongs to corporations and individuals. Who in their right mind wants to invest when the government is creating unfriendly regulatory and taxation issues? Why would you invest when you don't see responsible spending on the part of the government? Why not just shelter the money in other havens around the world who are business friendly and who do have their financial house in order?
The irony, of course, being that the vast majority of the deficit is due to the stagnant economy and that regulatory and taxation issues are mostly in the heads of people who can't bother to read the newspaper.
And who, pray tell, has their fiscal house in order (aside from China and BRIC)? Pretty much nobody, because the economy is in the toilet. Spain was running a surplus before 2008, yet they're having to beg for German money. The Germans
appear to have their fiscal house in order, but that's only because of the Euro's implicit transfer from the periphery to France and especially Germany. When the Euro fails, as it's looking increasingly likely to do, the Germans will not be looking so great. They know this, hence the billions of Euros they have dumped into other members of the currency.
When the Chinese have enough domestic demand to prevent a mass revolt if they stop selling us smile, I'll buy your argument. Until then, the Chinese have little choice but to keep giving us their goods in return for absolutely nothing. It's sad, but our smile sandwich is the only one in town right now. As long as that remains the case, we can spend anything we like and it simply won't matter.
People keep making the claim that deficit spending will destroy us in the near term, but if that's the case, why is our cost of funds still so low? If that view was correct, we'd be seeing a consistent upward trend in the federal government's borrowing cost. Of course, if the Republicans don't pull their heads out of their asses, they could do a fantastic job of blowing up the whole thing by not raising the debt limit.
Quote from: Conan71 on June 21, 2011, 03:28:46 PM
By your logic, apparently U.S. business doesn't care for the party in the White House or the majority in the Senate, it would appear.
Was it a political party or an entirely corrupt political system? Take a closer look at who (Dodd, Frank, et al) was looking the other way while accepting hefty campaign donations and sweet mortgages from those they purported to regulate.
By and large the big Wall Street donors are (D). Weren't they the ones who drove us off into this mess in the first place with their screwy maze of derivatives?
WRONG you are AGAIN! By and large, WS donors are (R)...and YES, they were the one's who rubber stamped everything warlike Bush propositioned the citizens into. Not that the dims aren't complicit....
"Was it a political party or an entirely corrupt political system? " Yes, it is....my point exactly. Must be difficult to come to the realization you as a citizen have become.....well.....MEANINGLESS! ;)
Wait, Conan, you seriously think Barney Frank, who was in the minority party until 2007 had anything to say about regulation? Perhaps you should look more closely at the regulators...
Quote from: nathanm on June 21, 2011, 04:11:21 PM
Wait, Conan, you seriously think Barney Frank, who was in the minority party until 2007 had anything to say about regulation? Perhaps you should look more closely at the regulators...
Uh, yeah, he's been a ranking member on the banking committee for a long time. There's plenty of evidence and recordings of him assuring there was absolutely nothing wrong with Fannie and Freddie even as they were collapsing. Let Google be your guide. Hell there's a whole chronology out there of Bush trying to get the banksters reigned in and being rebuffed at every turn by D's and R's in Congress who held sway over those matters.
Quote from: Teatownclown on June 21, 2011, 04:02:11 PM
WRONG you are AGAIN! By and large, WS donors are (R)...and YES, they were the one's who rubber stamped everything warlike Bush propositioned the citizens into. Not that the dims aren't complicit....
"Was it a political party or an entirely corrupt political system? " Yes, it is....my point exactly. Must be difficult to come to the realization you as a citizen have become.....well.....MEANINGLESS! ;)
My challenge to you: go to Huffpo and look up who the major players at WaMu, Bear Stearns, and companies like that were donating to it's all right there. The idea that banksters were largely in the pockets of Republicans is bunk.
You seriously believe that the ranking minority member gets to say anything about anything? This isn't the Senate.
Besides, Fannie and Freddie's troubles are seriously overrated. They were in much better shape than the commercial and investment banks that stupidly kept MBS on their books.
Barney Frank was partly responsible for Fannie and Freddie's trouble: He failed to get the word out about the real state of their finances. As every company that depends on rolling over financing was at the time, they were having cash flow issues. Now with interest rates stupidly low? They should be making money hand over fist and should therefore easily earn back any losses from bad mortgages, even if they all lost 100%. God forbid the papers report on that, though. It's not a sensational enough story.
Quote from: nathanm on June 21, 2011, 04:11:21 PM
Wait, Conan, you seriously think Barney Frank, who was in the minority party until 2007 had anything to say about regulation? Perhaps you should look more closely at the regulators...
Oh yes, you'r right. As the ranking member of the Committee on Financial Services he would have nothing to do with it.
I was going to post all of the hilarious Youtubes, but what's the point. Nate, there is no way that you can write Mr. Frank out of this history. :D
Quote from: nathanm on June 21, 2011, 04:40:00 PM
You seriously believe that the ranking minority member gets to say anything about anything? This isn't the Senate.
Besides, Fannie and Freddie's troubles are seriously overrated. They were in much better shape than the commercial and investment banks that stupidly kept MBS on their books.
Barney Frank was partly responsible for Fannie and Freddie's trouble: He failed to get the word out about the real state of their finances. As every company that depends on rolling over financing was at the time, they were having cash flow issues. Now with interest rates stupidly low? They should be making money hand over fist and should therefore easily earn back any losses from bad mortgages, even if they all lost 100%. God forbid the papers report on that, though. It's not a sensational enough story.
Yes I do believe that. He's a senior member of Congress. Majority party or minority party, senior members wield great power and have the ability to influence those in the majority. And no their troubles were not over-rated. That's engaging in Barney logic, Nathan.
Was Bahney Fwank incompetent or corrupt in overlooking the obvious?
Awww smile, I can't resist. . .
Quote from: Conan71 on June 21, 2011, 04:44:46 PM
And no their troubles were not over-rated. That's engaging in Barney logic, Nathan.
I take it you weren't reading their financials...
Quote from: nathanm on June 21, 2011, 05:04:33 PM
I take it you weren't reading their financials...
Yes I was reading them.
Saying they were in better shape is like saying the USS Arizona was in better shape than the Titanic because it sank in shallower water.
I ask again, was Frank incompetent or corrupt in his handling of Freddie and Fannie. (wow, that sounds really bad) ;)
Eh, read John Hempton's series on Fannie + Freddie and get back to me.
http://brontecapital.blogspot.com/2009/08/modelling-fannie-mae-and-freddie-mac.html
Quote from: nathanm on June 21, 2011, 05:17:22 PM
Eh, read John Hempton's series on Fannie + Freddie and get back to me.
http://brontecapital.blogspot.com/2009/08/modelling-fannie-mae-and-freddie-mac.html
Ahhh, a favorite of the liberals: blog spin!
I'll read that screed when I get back to my desk in the morning.
Here's something for you to read if you have trouble sleeping tonight. This is a factual account from the chambers of the people who were supposed to shovel up the smile from F & F. Date on this is June 3, 2009.
"We meet today to examine the present condition and future sta- tus of Fannie Mae and Freddie Mac,
which together have lost more than $150 billion since the third quarter of 2007. This hearing is not only the first hearing in the 111th Congress on the two Govern- ment-Sponsored Enterprises, but is also the first in a series that the Capital Markets Subcommittee will convene to review these matters."
http://financialservices.house.gov/Media/file/hearings/111/Printed%20Hearings/111-38.pdf
I don't care who you are, $150 billion in losses is staggering.
Yep, that's a lot. Less than many of the other big financial firms. And most of them are thus far paper losses, not cash losses.
I think it's funny that you dismiss my link out of hand without even bothering to read it. It has numbers and stuff. I guess you can call arithmetic spin, if you like. It makes you look reactionary, though.
Enjoy the truth....
Yes, move on....fire away. The truth hurts. We are not broke.
Quote from: we vs us on June 21, 2011, 11:15:54 AM
So I ... (delete your qualifiers)... will vote enthusiastically for someone I'm lukewarm about because to vote the alternative is madness.
That's why I usually vote republican.
Quote from: Red Arrow on June 21, 2011, 08:35:41 PM
That's why I usually vote republican.
You say potato, I say whackadoodle.
Quote from: Gaspar on June 21, 2011, 03:29:41 PM
But Conan,
In the Keynesian model this would not matter, because there is no variable for "confidence".
I think that is much like neglecting higher order terms, until they are needed to make the model correct.
Quote from: we vs us on June 21, 2011, 09:08:37 PM
You say potato, I say whackadoodle.
You way "whackadoodle", I say "law-abiding illegals".
Quote from: guido911 on June 21, 2011, 09:28:58 PM
You way "whackadoodle", I say "law-abiding illegals".
Let's call the whole thing off.
/scene
Quote from: we vs us on June 21, 2011, 10:02:56 PM
Let's call the whole thing off.
/scene
I see gweed's in full-on AW tonight...
http://www.harvard-jlpp.com/33-2/407.pdf
Quote from: Gaspar on June 22, 2011, 08:22:59 AM
http://www.harvard-jlpp.com/33-2/407.pdf
Did you read that article? There's actually nothing substantial in it. Issa establishes that 1) Fannie and Freddie supported an indeterminate amount of prime and subprime mortgages since the Great Depression; 2) Clinton expanded the mandate but doesn't say exactly how much or in what way they caused the meltdown 3) outlines the politically connected management and board of Fannie and Freddie, and implies that that means corruption, though doesn't directly make accusations of said corruption or illegality 4) briefly outlines the close relationship between Countrywide Financial, again implying through association that Fannie and Freddie were as corrupt, though declining to make specific accusations and then 5) capping it off by stating, in essence, that making affordable housing loans to the American poor and middle class caused the entire global financial crisis.
What a ridiculous hit piece.
Quote from: we vs us on June 22, 2011, 09:23:36 AM
Did you read that article? There's actually nothing substantial in it. Issa establishes that 1) Fannie and Freddie supported an indeterminate amount of prime and subprime mortgages since the Great Depression; 2) Clinton expanded the mandate but doesn't say exactly how much or in what way they caused the meltdown 3) outlines the politically connected management and board of Fannie and Freddie, and implies that that means corruption, though doesn't directly make accusations of said corruption or illegality 4) briefly outlines the close relationship between Countrywide Financial, again implying through association that Fannie and Freddie were as corrupt, though declining to make specific accusations and then 5) capping it off by stating, in essence, that making affordable housing loans to the American poor and middle class caused the entire global financial crisis.
What a ridiculous hit piece.
I did not find it ridiculous. I found that it establishes that those on the Financial Services Committee, including it's beloved chairman Barney Frank, and his significant other were fully aware of the situation.
Quote from: we vs us on June 22, 2011, 09:23:36 AM
Did you read that article? There's actually nothing substantial in it. Issa establishes that 1) Fannie and Freddie supported an indeterminate amount of prime and subprime mortgages since the Great Depression; 2) Clinton expanded the mandate but doesn't say exactly how much or in what way they caused the meltdown 3) outlines the politically connected management and board of Fannie and Freddie, and implies that that means corruption, though doesn't directly make accusations of said corruption or illegality 4) briefly outlines the close relationship between Countrywide Financial, again implying through association that Fannie and Freddie were as corrupt, though declining to make specific accusations and then 5) capping it off by stating, in essence, that making affordable housing loans to the American poor and middle class caused the entire global financial crisis.
What a ridiculous hit piece.
So you are willing to entirely dismiss any conclusions of Issa simply because he's a Republican? There's plenty of verifiable information to back up Issa's assertions.
Quote from: Conan71 on June 22, 2011, 09:53:42 AM
So you are willing to entirely dismiss any conclusions of Issa simply because he's a Republican? There's plenty of verifiable information to back up Issa's assertions.
He didn't really "assert," he documented.
Quote from: Gaspar on June 22, 2011, 09:55:26 AM
He didn't really "assert," he documented.
Yeah, well, that documentation is suspect because Issa just wants to take pot shots at Dims. ;)
Preemptively pwned. Sorry:
http://www.mcclatchydc.com/2008/10/12/53802/private-sector-loans-not-fannie.html
You need to learn that there are many Republicans presently in Congress who are willing to lie through their teeth and literally make things up from whole cloth, usually given cover by one of the blatantly partisan think tanks.
Edited to add: This might help highlight my specific point:
Quote
Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent, according to data from Inside Mortgage Finance, a specialty publication. One reason is that Fannie and Freddie were subject to tougher standards than many of the unregulated players in the private sector who weakened lending standards, most of whom have gone bankrupt or are now in deep trouble.
During those same explosive three years, private investment banks — not Fannie and Freddie — dominated the mortgage loans that were packaged and sold into the secondary mortgage market. In 2005 and 2006, the private sector securitized almost two thirds of all U.S. mortgages, supplanting Fannie and Freddie, according to a number of specialty publications that track this data.
Why is that important? Because loans written in 2006 and earlier are not going bad at nearly the rate of the 2006-2008 loans. Fannie and Freddie got caught in a shitstorm, to be sure, but they are still in a much better position than most of the commercial banks and the hedge funds investing in MBS-backed CDOs.
Quote from: nathanm on June 22, 2011, 05:23:52 PM
Preemptively pwned. Sorry:
http://www.mcclatchydc.com/2008/10/12/53802/private-sector-loans-not-fannie.html
You need to learn that there are many Republicans presently in Congress who are willing to lie through their teeth and literally make things up from whole cloth, usually given cover by one of the blatantly partisan think tanks.
Edited to add: This might help highlight my specific point:
Why is that important? Because loans written in 2006 and earlier are not going bad at nearly the rate of the 2006-2008 loans. Fannie and Freddie got caught in a shitstorm, to be sure, but they are still in a much better position than most of the commercial banks and the hedge funds investing in MBS-backed CDOs.
Hmmm, Democrats swept the house in Nov. of 2006 which means Barney Frank became the chair of the House Banking Committee and
could have put the brakes on at any time. Even as a ranking member of the minority and long-term member of the banking committee, he could have blown the whistle at any time prior to Jan. 2007.
Complicit or complacent in his duties and completely ignorant?
Quote from: Conan71 on June 23, 2011, 09:56:13 AM
Hmmm, Democrats swept the house in Nov. of 2006 which means Barney Frank became the chair of the House Banking Committee and could have put the brakes on at any time. Even as a ranking member of the minority and long-term member of the banking committee, he could have blown the whistle at any time prior to Jan. 2007.
Complicit or complacent in his duties and completely ignorant?
Reeks of lobbyist money on both sides of the aisle here. JMO.
Quote from: Hoss on June 23, 2011, 10:30:32 AM
Reeks of lobbyist money on both sides of the aisle here. JMO.
I'll take "complicit" for $400 Alex!
I'm ok with you making BF the scapegoat, Dreamer. Time marches on!
Meanwhile, another Repuke bails on his mission. Pissants....
http://www.theglobeandmail.com/news/world/americas/top-republican-quits-us-budget-talks-as-debt-ceiling-deadline-looms/article2072424/
They just love to make themselves look like martyrs. FAIL!
The country waits....the world wonders.....
Quote from: Conan71 on June 23, 2011, 09:56:13 AM
Hmmm, Democrats swept the house in Nov. of 2006 which means Barney Frank became the chair of the House Banking Committee and could have put the brakes on at any time. Even as a ranking member of the minority and long-term member of the banking committee, he could have blown the whistle at any time prior to Jan. 2007.
Complicit or complacent in his duties and completely ignorant?
http://democrats.financialservices.house.gov/press110/press021607.shtml
http://democrats.financialservices.house.gov/press110/press030907.shtml
http://democrats.financialservices.house.gov/press110/press033007.shtml
By the way, the subprime bubble began its bust in 2007. Nobody paid much attention until the freeze-up of the commercial credit markets in the wake of the failures of the investment banks. (they all failed..note that there now are none, they're all commercial banks)
The larger problem, as discussed ad nauseum on Planet Money a year or two back when they still had Toxie around, was that the OCC, OTS, and FDIC under Bush refused to use the existing regulatory powers they possessed.
There's a couple of real hall of flamers, Barney & Maxine. I forgot she served on that committee. Explains a few things.
"Finally, in crafting this clarification, we ask that the federal and state regulators continue to work together to make certain that the guidance not artificially restrict the availability of credit to underserved markets and that it applies - to the extent possible- to all mortgage originators (regardless ofwhether they are state-chartered, nationally- chartered banks or mortgage companies)."
IOW- keep making loans to low income borrowers who might not be able to afford the payment.
The letters I'm reading are simply saying: "Provide more clarification and guidance."
Reading further, they pulled the same smile Washington has pulled for decades. Instead of doing an overhaul of an existing department, getting rid of dead wood, and simply instituting new and tougher policies via an existing agency they simply create yet another bureaucracy supposedly charged with tougher regulations. How long does it take to set up a new department or commission and get it functioning like it should. They pulled the same smile with the safe food act and many other acts. It's window dressing. Spend more money for another duplicated mission while we create yet another multi month or multi year delay in actually toughening regulations.
Underserved does not equal subprime. And as I posted earlier, subprime originations during the bubble were mostly in private institutions and most of that lending was done prior to 2007.
You can pull quote if you like, but the fact of the matter is that their (stated) main concern was the rampantly obvious pushing of predatory forms of lending on unsuspecting and/or unsophisticated borrowers while not restricting lending to nominally subprime borrowers who do in fact have the income/employment history to justify being lent lots of money. (a lot of people become 'subprime' when they can't pay their medical bills and aren't aware that they can get medical collections completely cleansed from their credit report after they're paid)
On this, I don't think there's a lot of reasonable criticism to be made. If you want to criticize, there's plenty of room over the financial regulation reform bill. The non-transparent CDS market will bite us in the donkey once again when Greece defaults. IMO, CDS should be regulated as insurance and only available as a bona fide hedge. This BS about people buying naked CDS contracts is a large part of what made the financial crisis so systemic. It increased the losses without any possible upside. Especially where certain hedge funds paid certain banks to pool the mortgages in a certain way so that they could get sure money out of AIG and others writing CDS contracts.
One thing was made crystal clear by all this: The market cannot, as the Bush Administration claimed, be relied upon to self-regulate. Left to its own devices, we get rampant fraud and calls for bailouts to save us from a financial panic.
Also, at some point, when it's clear that existing regulatory agencies either lack the culture or the expertise to work within a stricter regulatory framework or they simply don't have the perspective necessary because of their close cooperation with industry (I argue OTS and OCC are in this boat), a new agency hopefully not beholden to those they regulate may in fact be appropriate. How tough can you be on banks when the banks are the ones funding your agency, after all?
Well he might get it if he actually read Ryan's budget. Or checked the numbers therein. Or read the deconstructions of it that are easily accessible on the internets. (And which come from the entirety of the political spectrum) Then perhaps he wouldn't be so confused by the opposition to it.
Quote from: nathanm on June 24, 2011, 03:46:47 PM
Well he might get it if he actually read Ryan's budget. Or checked the numbers therein. Or read the deconstructions of it that are easily accessible on the internets. (And which come from the entirety of the political spectrum) Then perhaps he wouldn't be so confused by the opposition to it.
(http://img.fannation.com/upload/group_preference/image/475/47/full/angry.bmp)
(http://www.nwacg.net/gallery3/var/resizes/random-stuff/%57%54%46-BBQ.jpg)
President Obama is #WINNING
http://www.cnbc.com/id/43534613
Quote from: Gaspar on June 27, 2011, 07:40:52 AM
President Obama is #WINNING
http://www.cnbc.com/id/43534613
It's interesting that the article doesn't mention Obama or the uncertainty amongst the business community as being behind the tepid recovery. Instead, it talks about Rogoff's observation that recovery from a debt bubble is usually far longer than a standard recession, and that consumer demand is dry dry dry.
I'd say the uncertainty is on the part of the consumer, not business.