Steve in Greensboro

And Bernanke Didn't Think Unemployment Would Reach 10%

Don't worry, Mr. Slavo. All we need to do is more of what we have been doing: print more money and have another stimulus or two. Plus, let's raise taxes by socializing medicine, taxing carbon dioxide emissions, allowing the Bush tax cuts to expire in 2011, imposing a VAT, etc. Plus, let's impose massive tariffs like the G-20's "balanced trade" plan. Paul Krugman thinks these are all good ideas and he has a Nobel prize -- in economics!

Happy days are here again!

The Economic Recovery That Isn't

Apropos of Mr. Schiff's article and j-dub's comment above, here is a brief excerpt from the interview with John Mackey in yesterday's WSJ.

“…At age 25, John Mackey was mugged by reality. "Once you start meeting a payroll you have a little different attitude about those things." This insight explains why he thinks it's a shame that so few elected officials have ever run a business. "Most are lawyers," he says, which is why Washington treats companies like cash dispensers…”

As Shakespeare said "first, kill all the lawyers". Today, that would include almost 100% of the Executive and Legislative branches.

Another Crisis Looms Right Around the Corner

50% cash, 50% gold pending the Obamacalypse.

6 Ways to Short the Obama Health Plan

It is pretty frightening that someone who says an innovative drug developed, of course, by a U.S. pharmaceutical firm "...changed my life, no kidding..." is happy that pharmaceutical firms will "get squeezed".

How are you going to feel when the pipelines dry up due to the lack of profits from patented products to offset the ridiculous costs of obtaining FDA approval?

Obama Summarizes Economic Policies, Misses Several Key Points

Obama is a lawyer. Economics, business, he does not understand. He is doing what Larry Summers and Bernanke tell him to do (spend and print USD like crazy). If that was all the government did, we might get another house-of-cards recovery, like we did after the 2000-2002 dot-com bubble burst.

But there is another factor in the current environment.

The U.S. hard left control the Legislature and Obama is a man of the left, so we will get carbon dioxide taxes, nationalized healthcare and higher marginal tax rates. This will offset (and more than offset) any recovery engineered by the conventional thinkers Summers and Bernanke.

Sorry, but we voted for it.

Obama's Housing Plan: Elegant and Costly

Let's all meditate for a moment on the first line of Mr. Salmon's note:

"I have to say I like the look of Obama's housing-bailout plan. It's quite elegant, and makes full use of the fact that Fannie and Freddie are now owned by the US government -- which means they can be forced to offer 105% loan-to-value mortgages even when the borrower isn't creditworthy at all...."

It is a BAD IDEA to take taxpayer money and loan it to non-creditworthy individuals (or corporations for that matter).

The Community Reinvestment Act was used to force banks to make loans to non-creditworthy individuals and this is one of the root causes of our current crisis.

Doing more of the same will NOT HELP.

Obama speaks. Markets go down again. Somebody should tell our socialist president to shut up and sit down.

Read Marc Faber's op-ed in the WSJ: "...The best policy response would be to do nothing and let the free market correct the excesses brought about by unforgivable policy errors. Further interventions through ill-conceived bailouts and bulging fiscal deficits are bound to prolong the agony and lead to another slump -- possibly an inflationary depression with dire social consequences."

Amen.

Obama Makes Sense

Pay attention to what he does, not what he says.

The Unsustainable Lie of Inflation

On Nov 09 02:25 PM Michael Clark wrote: "...Inflation is the rich stealing from the poor....Deflation is the poor getting even with the rich...."

On Nov 09 04:23 PM ThirtyNineWinks wrote: "You've got it backwards. Inflation robs from people with money, and helps people with debt..."

ThirtyNineWinks has it right. Mr. Clark has it exactly backwards. Speaking generally, the rich are generally creditors and the poor are debtors.

Monetary inflation make the dollar-denominated assets and liabilities both worth less. The positive net worth of the rich gets smaller and the negative net worth of the poor, while still negative gets smaller too. Deflation works the opposite way, helping the rich and hurting the poor.

Inflation helps the poor by reducing the value of their debt compared to their wages. The fact that it also reduces the debt of the biggest debtor on the planet, the U.S. government, makes it a certainty that there will be inflation, because the U.S. government controls the money supply and will guarantee inflation.

But in the end, inflation hurts everybody, because the primary unit of account (the USD) becomes corrupted and unreliable, making business decision-making, capital accumulation and resulting wage increases impossible.

It's an Economic Reset, Not a Recession

Bernanke, Obama and company are all working to delay the "reset" by continuing the overconsumption and debts accumulation. But by doing so, they will greatly aggravate Great Depression II in depth and length.

Obama lashes out at health insurers in his weekly radio address, calling their efforts 'deceptive and dishonest.' "For decades, whenever we have tried to reform the system, the insurance companies have done everything in their considerable power to stop us," he said.

It's funny how most people's interactions with the U.S. government are horrible.

U.S. Customs? Arrogant, rude and very, very slow.

U.S. Postal Service? Slow and increasingly expensive.

The Internal Revenue Service? Draconian, arbitrary, capricious and stupid.

But we want to turn over our health care to these people?

Stimulus Bill Signed; Now, Will It Work?

Chad says: "Everyone should hope (the Porkulus bill) works, whether you supported it or not."

Porkulus bill is signed and this causes markets to go down 4%. Whether I "hope" the Porkulus works or not really isn't relevant. It won't help and hoping won't change that. And there is more socialist, anti-prosperity nonsense coming soon from Washington. The November 2008 lows are going to look pretty good by March.

Obama Talks Himself Into - And Out of - Bank Nationalization

Gentlemen, what we have in Washington today is "Amateur Hour". Unfortunately, the amateurs are all socialist lawyers with absolutely no understanding of economics.

Gas Tax: Will Thomas Friedman Silver Bullet Work?

Why is it that the Left thinks that raising taxes is the solution to every problem (carbon dioxide, healthcare, tobacco use, etc.)?

Why is it that the Left thinks it is a great idea to raise taxes during Great Depression II?

And, let's be serious. Nobody on the Left cares about the deficit other than as a talking point (e.g. David Obey's Afghan war tax). Every dollar raised in taxes will result in two dollars of additional spending.

You Can Spend Your Way Out of a Recession

Sorry, Mr. McTeer, you lost me here.

The vicious circle we are living now is not a shortage of consumption. The vicious circle is massive overspending by the U.S. government. There is no shortage of consumption in the U.S. There is a shortage of saving and investment.

This Recession Ain’t Over

Thanks, Mr. Hansen, for keeping us focused on the facts.

You are right the recession is not over. But I disagree with your assertion that "...Our recovery hit a slight speed bump in the month of cash-for-clunkers, incentives for first-time home buyers, and stimulus..." We are in for a long period of zero or negative growth.

We are experiencing the failure of vulgar-Keynesian government spending and Bernanke-Greenspan currency debasement as government policies to repair a collapse driven by excessive government spending and debt.

Further, the real economy is waiting to see if our clueless politicians really mean what they say about their intent to increase taxes, including carbon taxes, repeal of the Bush tax cuts in 2011, removing the cap from Social Security taxes, VAT, etc.