Stock Market Leads the Way

As I write this the stock market is up nearly 200 points, and it has risen in each of the last three months.  Commodity prices are rising based on encouraging manufacturing data from abroad.  Personal incomes rose 0.5% in April.  Chrysler could exit bankruptcy as soon as Monday.  Citigroup and GM are removed from the Dow Jones Industrial Average, replaced by powerhouse Cisco and Travelers.  Ford motor’s shares rose 4.9% on news that it plans to expand production in the third quarter to try to gain market share from its rivals, and without government money.

The Stimulus Flop

Less than 10% of the $780 billion stimulus package has been spent.  President Obama told us we desparately needed or we may be mired in this recession/depression for years .  The free marketers said that this economy is strong enough to recover on its own, which the statists sneered at.  Government created this mess by their meddling in the housing market and how they mishandled interest rates and the money supply but we were told that “only government” can get us out of it.  More recently President Obama, who has been trying to spend every dime Congress will let him get his hands on has said we are out of money. Here’s a thought:  repeal the rest of the stimulus and get out of the way of the strongest economy on earth.

Things to Ponder

• Obama opposed bankruptcy for GM and Chrysler.  Free marketers said it should be allowed to happen.  That’s how the free market works.  After pouring billions of taxpayer dollars into these two, where are we?  Both are in bankruptcy.
• Bankruptcy for GM and Chrysler would be an extraordinarily long and drawn out process costing millions of jobs and killing the auto industry in the U.S.  Where are we?  Chrysler may emerge from bankruptcy as early as Monday, Ford is ramping up for the third quarter.
• Without the stimulus package, we were told the unemployment rate could hit 9% by 2Q2010, whereas with the stimulus it will peak at 8% at the 3Q2009.  Where are we?  It is now at 8.6% and we are in 2Q2009.  The stimulus passed, little has been spent and the administration has been wrong again.  The free marketers say that unemployment will likely rise quickly and if left alone, the recovery will happen more quickly.  If the government meddles and tinkers, we will likely see what happened in the 1930s where this drags on for years.
• President Obama says we’re out of money.  So stop spending.  Repeal the stimulus that is accomplishing nothing because the bulk of the spending isn’t due to happen for another year or more.
• Watching the Information Technology job boards, I see a big rise in the job postings for sales people.  When companies are confident that the economy is turning, they step on the gas for sales to beat the competition.  The operational folks will soon follow.

If the Obama administration is not careful and doesn’t reverse course before he bankrupts us, we may be faced with accelerating inflation and sky high interest rates.  Shall we get nostalgic for the days of Jimmy Carter?

Don't Anyone Dare Say Government Caused This Mess

You can never solve a problem if you do not face up to the full scope of the problem.  In listening to President Obama, and reading liberal columnists like Maureen Dowd, in the description of what caused the current economic calamity, the government is always given a pass.

We are in an economic morass because of the eight years of failed Bush policies, greed on Wall Street, tax breaks for the rich, etc.  Government’s culpability which, I believe, is really the gravamen of our economic problems is never mentioned at all.  Democrats and Liberals don’t dare point to Democrats and liberal policies as having anything to do with the collapsing economy.  That is why they always say that this is the worst economy since the Great Depression, as they also said when Clinton ran for President.  They don’t dare say it is the worst economy since Jimmy Carter, since that would remind the American people that the Democrats screwed up that one as well.

Unmentionable Causes of the Current Economic Mess

• Fannie Mae and Freddie Mac out of control.  Explosive increases in debt taken on under the leadership of Franklin Raines (Democrat), and Jaime Gorelick (Democrat), remember she also gave us the firewall between the CIA and FBI that hamstrung the investigation of al Queda.  Raines made over $90 million while at Fannie Mae and at the same time was accused of overstating earnings by $10.6 billion.  So, where’s the demand for a clawback of Raines’s salary?
• Barney Frank (Democrat) and Chris Dodd (Democrat) — Frank blocked every attempt to put in place greater regulation over Fannie Mae.  The Bush Administration tried to increase regulation over Fannie Mae, but Frank blocked it.  What you hear today is that the reason for the economic problems are a lack of regulation.  Chris Dodd got VIP mortgage treatment from Countrywide mortgage before they went belly-up.  Asked to come clean on the mortgages, Dodd first said sure, we’ll get around to it.  Then he made some papers available for viewing, but not copying, and has since clammed up.
• Community Reinvestment Act — Carter (Democrat) administration program to push home ownership for low income people, by forcing banks to report how much they were offering loans in low income neighborhoods and face the consequences if it wasn’t enough.
• Janet Reno (Democrat) — in the Clinton Administration Reno threatened action against financial institutions if they weren’t lending enough low income individuals.  What bank doesn’t want to be publicly branded a racist institution?

So we have homeowners, who should have never qualified for a mortgage, about to receive bailouts from all the responsible people who took mortgages they could afford, when they could afford them.  Do you ever hear about any of this cast of characters mentioned by President Obama or the main stream media? No.  It wasn’t the government actively pushing social policy on those people least able to handle it.  It was greedy banks and unscrupulous lenders, trying to avoid being branded racists, who took advantage of these poor ignorant people.  Perhaps if the government hadn’t destroyed our education system, these people might have read what they were about to sign.

How Do you Solve Only Half a Problem?

As these characters are never mentioned as having a role in the problem, how can you ever hope to fix the problem if these bad actors are still going about their business doing what caused the crisis and blaming everyone else.  President Obama demonstrates his inexperience more profoundly every day, seemingly making things up as he goes along.  That is not leadership and what we need now in times of crisis is leadership.  Obama has never shown the courage or willingness to take on his own party.  Without rooting out these characters and really fixing the whole problem, it will only happen again down the road.

What we need now is a leader.  Someone who actually has experience running the executive branch of a state.  Someone who is not afraid to take on the entrenched power of their own party and has succeeded in doing so.  Is there anyone out there who fits that bill?  Gee, that sounds like Sarah Palin.

I’ve said it before.  Barack Obama is a masterful politician.  It is almost like a magician.  His slights of hand are so subtle, you have to be watching very closely the hand that is not the center of attention to catch what he is really doing.

Creating Jobs

As he tried to builld up support for his stimulus package the number of jobs his package would create steadily grew.  It went from 3 million jobs to 4 million jobs.  Further it went from 80% private sector jobs to 90% private sector jobs.  Pretty impressive stuff. But what is the other hand doing?

Saving Jobs

When public opinion got behind needing to do something, the rhetoric started to shift.  From creating jobs it became creating or saving jobs.  Saving jobs?  Just how do you measure that?  How do you link that a particular employer didn’t lay off an employee because of a stimulus package to save the salt marsh harvest mouse?  Once, you slipped in that innocent change and got the media to buy off on it, which is not a stretch with this president, you can really go full bore.  “Why, we saved 15 million jobs!”  Go ahead, prove we didn’t.

“Well the package was intended to create jobs, but then the economy went into a free fall.  No, we weren’t able to create the 3 (not 4) million jobs we promised but, by golly, we saved 25 million jobs from being lost if we didn’t implement the stimulus package.”  If repeated often enough and lapped up by the slobbering main stream media, a complete failure will be hailed as a masterstroke.

What Happened in the Great Depression?

FDR is still revered as the president who got us out of the Great Depression.  His own Treasury Secretary, Henry Morganthau, said that eight years of spending failed to reduce the unemployment rate.  But Roosevelt is still considered a hero, not a failure who couldn’t end the Great Depression after ten years.  He couldn’t end it at all, reallly, because World War II was what eventually ended it.

Conservative Battle Plan

Conservatives lost the battle to keep this stimulus plan from going forward, and putting one in place that would work, led by tax cuts.  We must expose this slight of hand.  Just like sitting in the theatre watching a magic show we have to stand up and shout, “Did you just see what he did with his left hand?!!”  We need to perempt this by asking liberals, “You’re not going to start saying now that the package is designed to save jobs rather than create them, are you?”  If we don’t expose them, they’ll pull it off.

If you earn less than $75,000 per year, you are in line to get a tax break of about $8 a week.  Let me get out of your way as you grab the car keys to take your $8 and go on a spending binge that will have the economy humming in no time at all.

There are No Earmarks in this Bill

Do you long for the days of Bill Clinton when he waxed philosophical about the meaning of the word “is”?  President Obama said:

“We are going to ban all earmarks, the process by which individual members insert projects without review,” he told reporters on the Hill Tuesday as he tried to build support for the measure.

So, if no Congressional member specifically inserts language about a specific spending request in a particular district, it doesn’t meet the definition of an “earmark.”  So cut out some of the specifics and voila, an earmark is no longer an earmark!  A pet project of Nancy Pelosi, preserving the habitat of the salt marsh harvest mouse, has $30 million, earmarked, er, included in the stimulus bill.

Republican lawmakers said they learned of the marsh money when asking about how various agencies plan to spend stimulus money. The vitality of the mouse has been an issue for Mrs. Pelosi and other California Democrats since the early 1990s.

While the Republicans are raising questions about how American’s tax dollars are being squandered in the name of stimulus, Democrats are responding by calling Republicans unpatriotic, obstructionists, against the will of the American people.  When Speaker Pelosi’s office was asked about the $30 million a spokesman had this response:

“The speaker nor her staff have had any involvement in this initiative. This is yet another contrived partisan attack,” Pelosi spokesman Drew Hammill said. “Restoration is key to economic activity, including farming, fisheries, recreation and clean water.”

Does anyone with a room temperature IQ actually believe that statement?  The spending is in San Francisco which is where Nancy Pelosi’s district it located.  Are we supposed to believe she had nothing to do with $30 million of spending in her district?  Was it a Valentine’s Day gift from Steny Hoyer?  If she knows nothing about it, TAKE IT OUT! Those evil Republican partisans had the temerity to ask this question:

“This certainly doesn’t sound like it will create or save American jobs,” Mr. Steel said. “So can Speaker Pelosi explain exactly how we will improve the American economy by helping the adorable little” critter?

The American People Weigh In

Maybe Pelosi can explain it, but she’s not going to.  Perhaps that is why a recent Rasmussen poll had that 67% of Americans think that they could do a better job on the economy than Congress.  Do you think Nancy’s mouse is one of the reasons for that?  Even more embarrassing:

Forty-four percent (44%) voters also think a group of people selected at random from the phone book would do a better job addressing the nation’s problems than the current Congress, but 37% disagree. Twenty percent (20%)are undecided.

Selected at random from the phone book! We pay these people $167,000 a year and we think names drawn at random from the phone book could do a better job!  Is it only me, or does someone else see a problem here?  These clowns are going to bankrupt us and our children and grandchildren, so they can push through this porka-palooza as fast as possible so no one gets a chance to look at it.  Spending didn’t fix the Great Depression.  Spending didn’t end the lost decade in Japan.  Why do we think it will work now?  Isn’t that the definition of insanity?

Tax cuts were proven by JFK, and Reagan, but let’s not try anything that has actually worked before.  The Democrats say that the reason spending didn’t work in Japan is that the spending wasn’t high enough or fast enough!  So, if this “stimulus” fails to work, as many are predicting, we can expect Congress to come back and say, well it’s those Republicans.  They didn’t let us spend as much as we wanted, so now we have to go back and spend $2 trillion.

So while you ponder that, enjoy your $8.  Don’t spend it all in one place.  But when you put your head on the pillow tonight, rest easy, the salt marsh harvest mouse got $30 mill.  But remember, the Democrats are looking out for you.  And don’t forget to start saving $2,500 for each member of your family, because that’s the size of the tax bill the Demcrates will be leaving you and your children.

President Barack Obama held his first press conference last night and did a masterful job of controlling the communication while dodging any hint that he let this stimulus package spin out of control, at the hands of Nancy Pelosi.

Elkhart, Indiana

I found it curious that President Obama chose Elkhart, Indiana, the RV capital of the world, as the backdrop for the current economic situation.  After all, in the campaign he said that driving SUVs and RVs was irresponsible.  What kind of gas mileage does an RV get?  He campaigned on Cap and Trade.  What would Cap and Trade do to the good people of Elkhart, Indiana if implemented?  How many people are going to out an buy an RV, which can cost up to $600,000, with the $10 per week tax cut President Obama is proposing.  Remember, he is dead set against across the board tax cuts, which could actually prompt an evil “rich person” to buy an RV.  It reminds me of the 10% tax on luxury yachts sales that killed the boat building industry and put many blue collar people out of work.

Disaster by Design

Of all the schemes tried over the years, from the Great Depression forward, to stimulate the economy, why does this President insist on going with the ones proven not to work?

No less an authority than FDR’s Treasury secretary and close friend, Henry Morganthau, conceded this fact to Congressional Democrats in May 1939: “We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong … somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises … I say after eight years of this Administration we have just as much unemployment as when we started … And an enormous debt to boot!”

Spending in the Great Depression didn’t work and that is according to the guy doing the spending.  Last night President Obama mentioned the lost decade in Japan.  However, all of the massive public works spending in Japan during that decade didn’t work.

What did Japan get from sustained and massive public works spending by the LDP after a real estate bubble burst in the late 1980s?  According to a recent article in the IHT, one thing is clear:  taxpayers ended up being saddled with the largest public debt in the developed world, totaling 180 percent of its $5.5 trillion economy.

While there are disputes over how to view the results, the Japanese appear to have learned a lesson, while US officials like Treasury Secretary Timothy Geithner, who spent time as a financial attaché in Japan after the collapse, appear to determined to repeat it on a larger scale

President Obama alluded to the “failed policies of the last eight years,” as if tax cuts created this mess. But today, Treasury Secretary Geithner opened his remarks on the bank bailout by basically saying that government action or inaction coupled with Wall Street excesses caused the financial debacle not tax cuts.  They were:

• Interest rates too low for too long – driving up home prices
• Complicated financial intruments that no one understood bundling mortgages
• Failure of goverment oversight
• People being encouraged to borrow beyond their means (by government)

But we are supposed to believe that only government can get us out of this.  So, government created the mess, they are ignoring what has worked in the past (tax cuts: Kennedy, Reagan, Bush), choosing those things that were proven failures (spending: Great Depression, Japan) and we’re supposed to be angry at Republicans for putting up a goal line stand to protect us from this impending disaster.

If this passes, be afraid, be very afraid