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  • Why Economists Messed Up [View article]
    Economists are like lawyers; they fool themselves into believing they are doing something constructive for society.

    Once they convince themselves they are doing good (whether they are or not) they proceed to make money prognosticating and equivocating about the morality of onerous taxation, lavish spending, corporate greed, and the need to fire people with 20 years service to a company or government.

    Most third graders have the common sense needed to be an economist.

    Here it is:

    1. Debt = bad
    2. Allowance for chores = good
    3. Lending to the kid you don't know very well = bad
    4. Principal busting the bully for shaking down other kids for lunch money = good
    5. Principal ignoring bully because it is his Nephew = bad
    6. Stealing money from Mom or Dad = bad
    7. Government stealing money from Mom and Dad = good (or so the politicians say).

    We have robbed the average citizen who invested in the nation (markets). We have turned around and robbed them and the next two generations to excuse the malfeasence of Wall Street. Our lawyer politicians are doing what lawyers do; equivocating and taking both sides to forestall reality until they can get elected again.
    Sep 7 03:11 PM | 18 Likes Like |Link to Comment
  • Coming Soon: Banking Crisis of Historic Proportions [View article]

    Positive thinking can be delusional thinking.

    If the 200 million + citizens don't have money or enough to pay mortgage, insurance, and other bills it won't matter how much the FED backstops the banks.

    The only thing too big to fail is the middle class and we have been thrown under the bus for illegal immigrants, the slotlful underclasses, and the upper class.

    Aug 16 09:15 AM chap08 wrote:

    > While I dont disagree with the facts in this article, it really says
    > nothing new and it ignores some key facts:
    > 1. Systemic failure is now far less likely than it was last year.
    > 2. The Fed has avoided hard defaltion and will continue to move towards
    > inflation. This will help the banks.
    > 3. A steep yield curve will also be held in place by the Fed - ideal
    > for the banks to make money.
    > 4. The Fed will take further action as it needs to - it has a lot
    > more fire power if it needs it.
    > 5. Banks that can be allowed to fail will be allowed to fail. There
    > is a severe risk to individual bank shares but you over estimate
    > the risk to the wider economy. The remaining banks will have more
    > pricing power and be stronger. The costs will be picked up by future
    > consumers and tax payers.
    Aug 16 03:11 PM | 18 Likes Like |Link to Comment
  • Republican Congressman Ron Paul plans to hold a hearing in May on the Fed's emergency loans from its discount window to non-U.S. banks. The "staggering amount" lent to these banks "provided no benefit to American taxpayers, the American economy, or even directly to American banks," Paul says.  [View news story]
    Ah yes, the "only the geniuses know how to run a bank" argument.

    It's o.k. to steal from the mouths of babes as long as it hurts the Chinese, who we are in bed with and have outsourced most of our jobs and technology and knowledge to. That makes a lot of sense.

    Nevermind that my kids and I are and will be taxed (enslaved) for the sake of foreign bankers, after all, it prevented a depression started by malfeasant banks and bankers supported by the FED.; yeah, that makes sense.

    Next we will use live bodies of citizens to create logjams to prevent floods and say "we did if for the children" and that the ends justify the means.
    Apr 3 04:27 PM | 17 Likes Like |Link to Comment
  • Inane Thoughts of the Day: CNNMoney Article Says 'Housing Shortage Is Coming'; Coldwell Banker CEO Says Now Is the 'Absolute Best Time' to Buy a Home [View article]
    "Once the job market rebounds, however, people will look to have their own homes again."

    Aye, there's the rub.
    Jun 25 11:44 AM | 17 Likes Like |Link to Comment
  • Healthcare Reform Consequences: Valuations Taking Hits [View article]
    The appearence of caring and sharing with the reality of command and control.
    Mar 26 05:19 PM | 17 Likes Like |Link to Comment
  • The SEC is weighing demands to make it easier for private companies to use social networks such as Facebook and Twitter to tap thousands of investors for small amounts of money using "crowd-funding." Any initiative would need to address concerns over social network fraud.  [View news story]
    Wall Street would, no doubt, love to sucker the next generation early and often.
    Apr 10 06:41 AM | 16 Likes Like |Link to Comment
  • Bonds: It's OK to Panic, But Take Your Time [View article]
    What incentive does anyone have to hire?

    If you are an early 20's something, single, and can move you can wait tables in any major city. However, if you are over 30, have kids or medical costs, a mortgage, and want to save for retirement and have health insurance you are a liability; who is going to hire you?

    Government? Nope, besides frozen pay.

    Private industry? Nope, unless you want part time no benefits and $8 an hour.

    If rates rise and employment doesn't seriously increase housing will continue it's collapse along with Federal, State, and Municipal tax revenues.

    That is hardly a recipe for "recovery" and more likely an environment for Stagflation a la' the 1970's.

    BTW - I paid 10% on my first mortgage in September 1987; my new Wife and I had to bust our keesters to make the payment which was over 50% of income. "Don't worry" they said, "you'll make more money in a couple of years and it will be easier".

    I also remember the late 1970's and 15% rates so when I refinanced my current home at 5% I thought it was pretty cheap - except I get 0.25% on savings.
    Dec 9 12:34 AM | 16 Likes Like |Link to Comment
  • The Big Picture: Is Gold Going to $4,500? [View article]
    Gold = Anti-Stock investment


    Two years ago with the bailouts and TARP being passed I went anti-stock as much as possible.

    "Liquidity" and "Increasing the Money Supply" and other euphemisms for money printing mean increased hard asset and commodity values and inflation (devalued currency).

    Owning equities when Great Depression II comes along will be like owning bars of soap when there is no water and you are starving to death.
    Nov 30 12:09 PM | 16 Likes Like |Link to Comment
  • New Job Opportunity - Spitting at the Moon [View article]
    Besides big government the problem is big business that does not go bankrupt or have CEO's and employees who do not go to jail for malfeasance; rather, they are bailed out with public funds while pocketing private profits.

    This is a two-headed hydra - one government, the other TBTF banks and corporations, both feeding off of the working, bill-paying populace; each head of the hydra screeching a siren song that they are the one who can save the country as they claw and gore the body public.

    Kill the beast!
    Sep 4 06:13 PM | 16 Likes Like |Link to Comment
  • Consumer Credit: Watch Those Revisions [View article]
    Yes, the commercials from companies like GE that stand to benefit from Government energy and healthcare programs turn my stomach.

    The Chase bank and Capitol One credit card commercials urging people to debt spend and use "debt management tools" or to earn "double points" are even worse.

    My 16 year old Son says to me the other day "Is it just me or are commercials getting more narcissistic." I told him I thought they had always been that way, but yes, they were getting worse.

    "You deserve that new Mercedes Benz" or "I just lost my job, but I couldn't turn down this great deal on a Saturn VUE and now I'm so happy" or "Design your own credit card", etc., etc.

    Oh great, I am going to be so happy if I can have a bowl of porridge and design my own shackles!

    People are now using credit cards to get by (or payday quick cash loan stores), and when that crisis comes to a head it will be bailout II and QE II.
    Aug 7 01:32 PM | 16 Likes Like |Link to Comment
  • Deflation: Pay Close Attention [View article]
    Repeal of the Bush tax cuts will not bring in more money; it will incentivize sheltering of income and tax evasion, which the more wealthy can afford the accountants and lawyers for. It will encourage a lack of hiring and spending.

    Municipalities are having no problem increasing taxes to compensate for lower revenues. Last year my city raised the assessed value of my home by 25% in a declining market. This year they lowered the valuation ~10%, but raised the individual taxes that are components of the total tax, creating a 3% tax increase over last year.

    My health insurance deductible is being doubled. Last year the premiums increased by 15%. Next year I anticipate increased premiums, with an increased deductible the year after. The end result is an increase in healthcare costs of at least 10% per year over the past five years considering premiums, deductibles, and co-pays.

    My home and auto insurance has been a similar story; increased premiums with drastically increased deductibles.

    Add in increased fees for car registration, school fees, cable and phone rates, and you have inflation which does not appear on government charts. Throw in a healthy dollop of dollar devaluation (it buys a lot less than it used to) and you have more "inflation".

    I have had to cut consumption by requisite amounts, and am down to the bone.

    At the same time, assets I have worked to accumulate by saving and being responsible; equity in my home, savings, IRA, retirement, not utilizing insurance (being safe and healthy) are being rapidly deflated by the unholy alliance between Wall Street and Washington. Crony capitalism and Political porkulance - hand in hand raking money to the elites and entitlement classes - while bleeding the responsible and productive middle class dry.

    My personal experience is that deflation and inflation are occuring at the same time on my balance sheet; whatever the charts and statisticians might say.

    The FED and the Congress and the Banks can attempt whatever voodoo or economic incantations they can think of, but until they stop destroying the middle class NONE of it will really fix the underlying destruction of the nation.
    Jul 25 01:56 PM | 16 Likes Like |Link to Comment
  • Wall Street Breakfast: Must-Know News [View article]
    "IMF wants more money, IMF denies Hungary, Ireland downgraded" - the reality of the sovereign debt in Europe will rear it's head again, despite all the "assuaging" of fear based on promises - based on hope - based on using other people's money (yours and mine).

    "AIA-AIG "- The miasma, mismanagement, and monstrosity perpetuates. IT reminds me of "The Blob" horror movie except it eats taxpayer money and has the mind of a petulant fool.

    If monstrous fools aren't allowed to fail the moral and responsible can't succeed.
    Jul 19 08:55 AM | 16 Likes Like |Link to Comment
  • Why It's Likely a Correction and Not Another Train Crash [View article]
    A cautionary note: much of the production in Europe and China is government run or sponsored. This is also increasingly the case in the U.S. with the bailout of banks, insurers, automakers, and unions.

    What else do these governments have to do other than spend and pump production?

    Oddly enough, the "austerity" is the cutting of wages and pensions and entitlements at the micro or individual level; things the governments have promised but now are reneging on because of the orgies of speculation by banks and quasi-government corporations and construction firms on the macro level and scale.

    If the responses of the past couple of years are indicative, any drop in markets or rise in Libor will be answered with more "stimulus" and spending; which could reflate the markets for a time.

    Long term, however, this is a steroids and aspirin approach to benefit banks and governments versus the underlying health and well-being of the economic body or the individual household; thus, the riots.
    May 30 03:33 PM | 16 Likes Like |Link to Comment
  • Market Corrections Are Not Unusual [View article]
    "Buy and hold long term and have a diversified portfolio..."

    Ummm...o.k....and I suppose if I put a Euro under my pillow tonight the tooth fairy will exchange it for an ounce of gold while I'm asleep too?

    This is a secular bear market.

    Of course Fidelity wants the retail investor to believe this is a bear market. Bull!

    The bounce of the crash was based on accounting changes, trillions in future debt and liquidity by the government, and on low volume.

    No doubt investment houses would love for the retail investor to get suckered into buying into the belief that this is a buying opportunity. How else do they make their money?
    May 29 06:10 PM | 16 Likes Like |Link to Comment
  • Whipsaw Wednesday: Tuesday Never Happened - Now What? [View article]
    A great majority of the retail investor's retirement and savings is tied up in mutual funds and 401K, A, B's.

    It isn't realistic from their situation to employ options or be traders.

    Record outflows from mutual funds illustrate this, as does the "fool me once shame on you, fool me twice shame on me" axiom reinforced in a very big way by the flash crash.

    The average person cannot become a day trader or options maven; and if they did, the volatility, insanity, and destruction of the markets would only worsen.

    The whole point of a casino is that not everyone can be "the house"; and the problem with the Wall Street casino is that they have the life savings and retirements of middle America held hostage for the sake of traders, hedge funds, banks, and politicians to gamble with.
    May 26 05:51 PM | 16 Likes Like |Link to Comment