Economy is OK if the news is NOT AS BAD AS EXPECTED

Recent news which is said to be good since it is not as bad as predicted.

Fed’s Bank Results ‘Reassuring,’ Show No Insolvency

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Federal Reserve stress tests on the 19 biggest lenders show Bank of America Corp., Wells Fargo & Co. and Citigroup Inc. together require about $54 billion, said people familiar with the conclusions.
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White House spokesman Robert Gibbs yesterday suggested that the Obama
administration may seek management changes at some banks. Officials will want to “ensure that going forward they felt that the management was in place to remedy the situation and ensure long-term viability without continued government assistance,” he said.

Bank of America Chief Executive Officer Kenneth D. Lewis, 62, was ousted as chairman on April 29 ……….

Jobs Report Giving Investors Mixed Picture On US Economy

The pace of layoffs slowed in April when employers cut 539,000 jobs, the fewest in six months. But the unemployment rate climbed to 8.9 percent,………………..

Job losses in February and March turned out to be deeper, according to revised figures. Employers cut 681,000 positions in February, 30,000 more than previously reported.
They cut 699,000 jobs in March, more than the 663,000 first reported. The deepest job cuts of the recession —741,000 came in January.

Jobs: A little less bleak

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Wachovia senior economist Mark Vitner and Gilliam both say they’re worried about the impact on jobs in coming reports from the bankruptcy at Chrysler, which will result in a 30-to-60 day shutdown at all of its plants, and the possible bankruptcy at General Motors (GM, Fortune 500). The loss of jobs — not just at those companies but at their dealers and suppliers — will be substantial.

And Vitner said that while Wachovia is projecting that there will be economic growth by the fourth quarter of this year, it’s projecting that unemployment will continue to rise into 2010, topping out at 10.8% in April of that year.

“We are moving in the right direction, but the recession is not over, and even when it’s over that’s not an end of the tough times,” said Vitner.

Wow a bank stress test with an 8.4% unemployment shows the banks will be OK, current unemployment is 8.9% and expected to exceed 10% in the next year.

I wonder if a new stress test will be needed so that the federal government can take over the banks.

Saturday’s cartoons – politics

from townhall.com

US Government spending will bankrupt the world

The US federal government is in the process of bankrupting the world as accounting practices that the federal government does not allow private companies to use are used to hide the real government debt. This cuts across party lines and the end of liberty and personnel freedom in the world.

The total economic of the world based on the ponzi scheme known as government spending is close (if not already beyond) the tipping point. Paper currency will be virtually worthless since the governments that print them have no possible way to back their value.

Government spending is the problem and drastic government spending cuts (real cuts not decreasing the rate of increase) of 50 to 90+% in some cases are required.

Federal obligations exceed world GDP, Does $65.5 trillion terrify anyone yet?

As the Obama administration pushes through Congress its $800 billion deficit-spending economic stimulus plan, the American public is largely unaware that the true deficit of the federal government already is measured in trillions of dollars, and in fact its $65.5 trillion in total obligations exceeds the gross domestic product of the world.

The total U.S. obligations, including Social Security and Medicare benefits to be paid in the future, effectively have placed the U.S. government in bankruptcy, even before new continuing social welfare obligation embedded in the massive spending plan are taken into account.

The real 2008 federal budget deficit was $5.1 trillion, not the $455 billion previously reported by the Congressional Budget Office, according to the “2008 Financial Report of the United States Government” as released by the U.S. Department of Treasury
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“The federal government is bankrupt,” Williams told WND. “In a post-Enron world, if the federal government were a corporation such as General Motors, the president and senior Treasury officers would be in federal penitentiary.”

Assuming 330 million Americans, 65.6 trillion debt is equal to $198,484 per American. This is on top of any state, local or personnel debt.

If you want to really understand the what the future holds and the consequences read the A Citizen’s Guide published by the treasury department.
It would be nice if government would live by this motto in the report.

Using the government accounting methods that if any private business used, the CEO, CFO and board of directors would be in jail, here are some tables from the report on future predictions.

These projects do not take into account the money spent since Oct 1, 2008. TARP and the new stimulus plan are on top of this staggering debt.

Americans need to hold our employees the elected government officials responsible. New blood is needed.

America at a crossroad, freedom vs socialism

The historical American way of life is at a crossroad. For the last 80 years there has been a slowly chipping away of Americans freedom by the federal government. The pretense is that the American government will make your life easier by limiting the lows of life with “safety nets”. With each safety net that has been installed by the federal government more regulations have been imposed using the sentiment that it is for the betterment of all. This has resulted in an America where success and the successful has been demonized, failure must be backstopped by the federal government and group think politics.

Group politics treats nobody is an individual, each person is part of a group classified by some characteristic (race, religion, sexuality, age, rich,poor, middle class). Based on this it generates conflict between the groups and each group wants to curry favors from the elected officials in exchange for support.

This group classification is a form of prejudice. Because someone is in a certain group they must have these beliefs. The individual has been lost to the collective.

This has culminated in an America where demonizing America and individual liberties while pretending to be defend America and individuals liberty is how politicians do their job. Trading one groups freedoms for a different groups liberty based on group think.

I am saddened by how much “hatred and fear” exists in America today. Both the republican and democrat parties claim the others use scare tactics to convince people that what the party currently in power is doing is just scare tactics and they are lying to you and nothing changes.

For the last 8 years all that has been said is how Evil Bush is and he is using the fear of terrorism to get elected and how is domestic policies are terrible for America. The federal government is not spending enough on some project and how some many people are hurt by the governments inaction. If Bush was a democrat, his growing of the federal government would have been lauded as being enlightened, the federal government grew by 50% under Bush in dollars being spent and taxes collected grew by 25%. The republican party and some conservatives supported him out of blind party loyalty.

During the 90s, Bill Clinton did some horrendous things to embarrass America and he was support by the democratic party loyalists and he could do no wrong.

Now the same people have flip flopped again everything Obama does is terrible by republicans and everything he does is great by democrats. This politics just disgusts me and is just tearing the fabric of America apart. The republicans are saying that Obama and the democrats are using fear about the economy to get what they want in the stimulus plan and there is not very much value it the plan. These are the same politicians who voted for the TARP plan 4 months ago.

Bush did play to fear some and Obama is playing to the fear now with the rhetoric about how bad the economy is and will be if the government does not do something.

Historically Americans have always joined together in times of crisis, Americans still do this but the political leaders start tearing the “opposition” down very shortly after the crisis starts which results in people arguing with each of over very silly topics based on nothing other than what some politician or talking head on TV says is important. I find myself getting caught up in this at times.

Americans historically have been knocked down but previous generations have picked themselves up off the ground, bushed themselves off and looked around and said to themselves, what can I do to make my life, my families life and my neighbors life better.

I see to many Americans today get knocked down and complain someone trampled on my rights and wait for some government help they stand back up. We are in hard economic times but there are still opportunities for one to be a success. The key is to look into one’s heart, think what can I do to help myself and my fellow man, not what can I expect government to do for me.

Fundamentally America has done more for the advancements of mankind in our short 230 year history than at any other society. This is due to individuals ideas, freedom to try new things and for lots of inventions that have succeeded and lots of attempted inventions which have failed miserably.

Just look at this map of the world and life expectancy from Wikipedia. The areas with the most democratic forms of government for the longest time have the longest life expectancy. This alone should prove to people that freedom from government oppression is better for mankind.

The free exchange of ideas and respecting other opinions that are different than one’s own is a corner stone of America. Just because someone has a differing opinion on some topic does not make that person evil.

In order for the human experiment called the American Representative Republic to continue to succeed and result in the prospering of mankind on the planet earth people must be allowed to fail. I know this initially sounds totally contradictory. How can America succeed if people fail. The reasoning is sound and true if it is allowed to be expressed and not criticized before explanation is interrupted.

GOP Rep. Jeb Hensarling on TARP last year.
“In my heart and in my mind, I believe that this plan is fraught with unintended consequences, would force generations of taxpayers to pick up the tab for Wall Street losses, and could permanently and fundamentally change the role of government in the American free enterprise system. Once the government socializes losses, it will soon socialize profits. If we lose our ability to fail, we will soon lose our ability to succeed. If we bail out risky behavior, we will soon see even riskier behavior. “

Think hard about the phrase If we lose our ability to fail, we will soon lose our ability to succeed. Failure breeds success, America promises opportunity and the pursuit of happiness not a guarantee of happiness. America will not survive and all of mankind will suffer if America continues on the current path of protecting failures and limiting success.

Budget Deficit – spending to prosperity

CBO project $1.2 trillion deficit for 2009 before any tax cuts or stimulus plans.

The U.S. budget deficit in 2009 is projected to spike to a record $1.2 trillion, or 8.3% of gross domestic product, the Congressional Budget Office said Wednesday.

The dramatic jump compares to a $455 billion deficit in fiscal year 2008 and $161 billion in 2007. The estimate does not account for the massive spending and tax cuts proposed in President-elect Barack Obama’s economic rescue plan.

Obama: $1 trillion deficits ‘for years’

The stimulus package, combined with the $7.2 trillion the government has invested or loaned in the past year to combat the financial crisis, will add greatly to the federal budget deficit.

“At the current course and speed, a trillion-dollar deficit will be here before we even start the next budget,” Obama said Tuesday. “And potentially we’ve got trillion-dollar deficits for years to come, even with the economic recovery that we are working on at this point.”

It took over 200 years for America to about $10 trillion in reported debt in early 2008. That debt is now close to $18 trillion and will go up by a trillion a year for the foreseeable future.

borrow,spend, and repeat until everyone is debt free

8 Years results in Big change

From townhall.com

Democrat Stimulus plan

It is a nice headline.

Obama: $300 billion in tax cuts

Middle-class tax cut: Obama would offer a tax cut equal to $500 a year for individuals and $1,000 for couples. The credit would work essentially as a payroll tax credit, meaning the money could be delivered fairly quickly. Companies could simply reduce the tax they withhold from employees’ paychecks

Does anyone really think that media attention grabbing congressional politicians are going to let this money go out anyway but a check that they can bragged about for months in the media.
Just like the democrats were saying in 2008, rebate check are not only for income tax payers, everyone should get one.

Sen. Charles Schumer, D-New York, said he was disappointed that Bush did not include stimulus-spending measures aimed at helping the disadvantaged such as extending unemployment benefits. Schumer said such spending initiatives would jump-start the economy faster than tax cuts alone.

“I think if we avoid any of the ideological fights, we could actually pass something so that it would take effect on March 1,” Schumer said.

House Speaker Nancy Pelosi, D-California, expressed agreement with Bush on “the need to provide assistance immediately,” saying in a statement that “we must invest our resources in such a way that injects confidence and consumer demand, promotes economic growth and creates jobs.”
Senate Majority Leader Harry Reid, D-Nevada, said, “I also agree that our focus must be on finding temporary measures that will do the job effectively.”

Sen. Edward Kennedy, D-Massachusetts, agreed that “we must act swiftly to boost the economy” but stressed the need to help families who “are struggling every day to pay their bills, heat their homes and pay their mortgages.”

I guess this is the 1st step to sharing the wealth, borrow from China to give to those who do not pay income taxes, an income tax rebate. I had same opinion of 2008 checks and thought those were a stupid idea as well.

Business tax breaks

Business break for losses: Obama is considering a tax break for businesses that book losses in 2008 and 2009.

The stimulus plan may extend what’s called the net-operating loss carryback to five years, up from two years currently. The provision lets companies apply their losses to past and future tax bills so that they can get money back on taxes they’ve already paid or would otherwise have to pay.

Job creation: Obama would establish a new credit for businesses that either create jobs in the United States or avoid layoffs.

Small business write-off: Obama would increase the amount of expenses small businesses can write off to $250,000 in 2009 and 2010, up from $125,000 currently.

While political observers believe the now-added emphasis on business tax cuts as a major part of a stimulus package is one way the Obama team hopes to attract Republican support

Now the small business expenses has some merit, I do not get the tax credit for not laying someone off. How is that going to be judged, I once thought of getting rid of an employee so I will get the credit, has fraud potential written all over this part of the plan.

I do not understand the loss carry-back reasoning, You are loosing money today because you have not reacted well to the changing marketplace so we are going to cover your losses by refunding old or allowing those losses to offset future profit. In the meanwhile the company that has keep its belt tightened and is making a modest profit will get nothing.
Oh wait, now I get it after I wrote it down, it is the same as the homeowner mortgage bailout, you do not pay your mortgage and you get the principal and interest rate lowered (which you still will not pay), you do pay your mortgage and you get nothing other than the bill to pay for those who did a bad job with their finances.
Makes perfect sense, cover the losses of poor financial planners by making those with good planning pay a larger share of the tax bill.

US Senate Runoff and Recount

Looks like Chambliss wins the runoff in Georgia to keep the filibuster potential for bench legislative judges if the RINOs stay with the party.

Not sure who is ahead in Minnesota. Coleman according to the paper or Franken according to the Secretary of State web page.

Not sure how the paper could have Coleman +316 and the Sec of State office have Franken +11170. Something is fishy either in the Press or the Sec of state office in Minnesota.

Jeb Bush in 2010 for Florida senate

Politico article

In an interview with Politico immediately after November’s election, the former governor said the Republican Party should take four primary steps to regain favor with voters: Show no tolerance for corruption, practice what it preaches about limiting the scope of government (“There should not be such a thing as a Big Government Republican”), stand for working families and small business, and embrace reform.

Bush said conservatives should “do the math of the new demographics of the United States,” explaining that the Republican Party “can’t be anti-Hispanic, anti-young person — anti many things — and be surprised when we don’t win elections.”

Maybe he should have talked to his brother the last 8 years about being a Big Government Republican.

He has a big hurdle to overcome as a Bush and big government, Both his Dad and Brother fooled Conservatives. Does he think we will be fooled again.

Repeat after me, “I will not vote for a Bush again, I will not vote for a Bush again”

Continuation of 2nd contract with America

As a continuation of my thoughts on How Conservatives should change the Republican Party

A 6th plank in the new Contract with America

No entity can contribute to a political candidate for a general election which cannot vote for said candidate.

This means that only individual contributors can donate money to political candidate.
No business $, no Lobbyist $, no Union Dues $, No out of district contributions.

For the general election of a president only 20% of contributions may be spent outside of the state in which the contribution was collected on national advertising. 20% of the money collected in NY can be spent on a nationwide commercial purchase, no regional advertising with this 20% of the money.

Political parties are only allowed to spend money in the district the money was collected.
No collecting money in California for a Maine congressional candidate, no collecting money in Texas for a New York candidate.

This would make the congress members more responsible to their constituent since they can’t rely on people other than their voters for campaign contributions and it would make all states important in presidential elections since every state would need to have money collected to advertise in that state.