Showing posts from December, 2011

Differance of Stimulus And Welfare

There is a difference between a stimulus and welfare and we should not get them confused. A stimulus is when someone provides a good or service to the government and is paid. An example is when the government enters into a contract to repair a road. When the contractor completes the work he is paid. This is similar to members of congress being paid for rendering a service so the government runs  in a manner approved by the people. In theory neither will get paid if they do not do the work.

We Are Better Off Than Four Years Ago!

We are better off than we were four years ag0. With hindsight we know we were deeply involved in a sub-prime mortgage meltdown that almost brought on a depression. This meltdown was partially brought on by relaxing financial regulations and allowing institutions to get to big to fail. At the same time, we were involved in a war in Iraq that should never have been. Thanks to Obama we are now out of it. Some will say we left too early. I say we went in too fast. It cost us much in life and treasure, while getting very little in return.

We Should Stimulate and Help!

I can see where the chart that follows, taken from an article by Paul Krugman in the New York Times titled  Debt And Growth In The G7; can justify the theory that we can afford to borrow additional funds in order to stimulate the economy. It does appear the world will not collapse from excess debt. However, it does suggest that over the longer run our debt as a percentage of GDP needs to be reduced. The second part of the question is will a stimulus help. So much of our consumption comes from overseas including oil from the middle east and goods from China. The result is that the funds borrowed quickly leave our shores and remain in other sections of the world. As a result we have borrowed money to help stimulate the economies of China and the middle east

Should He Be President Romney?

Whether you believe Mitt Romney should be President depends on what you believe are his objectives. If you believe he will say and do whatever to gain and keep the office of President, he should not be elected. On the other hand, If you believe he will always do what he believes is best for the country, vote for him for President. "Nearly four decades ago at Harvard, Mr. Romney embraced an analytical, nonideological way of thinking, say former classmates and professors, one that both matched his own instincts and helped him succeed. On a campus ripe with political and social ferment, he willfully distanced himself not only from politics, but also from larger ideological frameworks and heated debates." At Harvard, A Master Problem Solver , Jodi Kanton, New York Times, December 24, 2011

China's Bubble!

Just about all experts believed real estate was exempt from bubbles. Invest in real estate and nothing can go wrong. The theory relied on banks to make rational decisions about who they would lend too and they would be properly regulated. The secondary market and cooperative rating agencies allowed banks to unload risky loans; so they thought. When the loans stopped performing so did real estate

Health Insurance And Free Markets

"Why doesn’t the market work here? Ken Arrow explained it all half a century ago. Patients by and large don’t have the information to evaluate medical treatments; in any case, they mainly buy insurance rather than medical care directly; and insurers profit not by providing the most cost-effective care, but by trying to insure people who won’t need care." Paul Krugman. Ron Wyden, Usefull idiot, New York Times, December 17, 2011 The market does not work because it is not free. In addition, it is not properly regulated. In many states one health insurance company, not always the same one, controls over 80% of the market. This is not a free market. Further, the industry needs better regulating.

Newt Gingrich: Wrong Perscription

We all make mistakes in life. THe problem is when they are made when you are older they cannot be corrected "Shortly before the passage of President Obama’s stimulus bill in 2009,  Newt Gingrich ’s political committee put out a video of Mr. Gingrich denouncing it as a “big politician, big bureaucracy, pork-laden bill.” But at the same time, Mr. Gingrich was cheering a $19 billion part of the package that promoted the use of electronic health records, something that benefited clients of his consulting business. “I am delighted that President Obama has picked this as a key part of the  stimulus package ,” he told health care executives in a January 2009 conference call.  Gingrich Push on Health Care Appears at Odds With G.O.P,"   By   JIM RUTENBERG   and   MIKE McINTIRE , New York Times,  ublished: December 16, 201 1 Newt is what we do not need as President. He is a sly insider. He is in it for personal gain. He milked the system when he was in office and continued mil

Ron Paul & The Economy

I admire Mr. Paul's consistency. It is unfortunate that he is often wrong in what he believes. The economic community and the President need to accept much of the blame for the citizens not buying into the idea that we need to stimulate. The population has never been educated about the benefits of Keynesian economics. It is a complex subject that somene needs to simplify so  a  phD from Princeton is not needed to understand. Some of the basics that need explaining include: 1) Can we afford another stimulus given our present debt load and, 2) given the fact that so much of our consumption is from abroad, will we really be stimulating our economy?  More:

My Dinner With Barack Obama!

Last night I had dinner with Barack and Michelle Obama. Below are excerpts from our discussion. A lady friend and I were having dinner at a restaurant in downtown Detroit and the Maitre d' asked if we would mind if the President and First Lady shared the table with us. After falling off my chair and embarrassing my date, I said sure. What an honor. First, they are really nice, down to earth, people. They did everything in their power to make us feel like equals. I could like this guy as a friend. The same is true of Michelle. I also must admit that she does not hurt the eyes.

Adjust Taxes on Wealthy!

We need a temporary fix to our tax code and a major change to our "capitalistic" economic system that is currently broken. In the long run, the issue is not how to tax the rich. It is about fixing capitalism and free markets If capitalism was fixed, we would have a more even distribution of income and tax revenues would come from a wider base of our population.

Credit Agencies: Risk To Your Fiscal Health

"MF Global’s investors may not have been fully informed about the European bet, but the firm’s executives had been explaining the strategy to the ratings agencies for months, according to two people with direct knowledge of the conversations. Indeed, Moody’s Investors Service and Standard & Poor’s had applauded Mr. Corzine’s effort to overhaul the firm, a move that included ratcheting up risk. “We consider the most recent strategic plan of the new C.E.O. Jon Corzine to be sound,” S.& P. said in 2010, while acknowledging the plan “will incrementally increase the firm’s risk profile.”

Complaints About Politicans!

Why do politicians say they are for small business and they do nothing to protect small business from big business monopolies.?  Why does Obama complain about Wall Street firms and big banks and yet attend $40,000 per plate fund raising events with them and accepts their money? Why do Republicans say they are pro growth and be against investing in infrastructure that would make us more competitive in the future? .Why would the President complain about the banks and appoint a Senior Executive with Chase Bank as his chief of staff. Why are not other politicians, at least Democrats, giving Presidents Obama and Bush crefit for averting a depression in 2008? Why are Republicans giving up on the future of or country by refusing to invest in education. Why are rating agencies allowed to be bought off by the public companies that they are rating? Either t

Should we stimulate?

The President must address two questions. 1. Given the size of our existing debt can we afford to stimulate, invest, without causing the same problems as experienced in Europe? 2. Given the fact that a significant portion of what we consume is imported from our trading partners, how much will a stimulus increase demand for goods ans services produced in ths country versus imports? Will we be stimulating demand for goods produced by our trading partners? All Stimulus Is Not Created Equal!

Oligopolies: Are They Like Blagojevich or Corleone?

Yesterday Rob Blagojevich , former Governor of Illinois, was sentenced to 14-years in prison for trying to "sell" Barack Obama's former senate seat for personal gain. In the 1972 movie classic, The Godfather, the head of the Mafia, played by Marlin Brando, would help an acquaintance needing a favor and say, "some day, and the day may never come, I will call upon you to do a service for me." This is exactly what the oligopolies, both corporations and unions, do with our representatives in Washington. They give them campaign bribes and in return expect, and receive, favors in the future. When the Godfather asked for a favor, no one refused. Until this is changed in Washington, nothing else will cgange. Here is what needs to be done.

Verizon and Cable TV Scam!

This is what Occupy Wall Street is upset about. Our government just stands by and does nothing as big business walks over anti-trust laws and controls more of our so-called free markets. This is not capitalism. It is cronyism. Big business gives big bribes, contributions, to politicians and they look the other way. The result is our country is being run by Oligarchs.