ldgregg

How Can the Government Reduce Unemployment?

The govt can stimulate job creation through a package of investment tax credits for businesses that hire and make capital investments. Big incentives. The govt should refrain from throwing large wads of cash at failing banks and car companies and offer big tax credits to companies across all industries based on job creation and capital investments. Especially critical now. Many businesses are starting to see increases in business, but after downsizing are hesitant to add more employees back. Tax credits are great incentives.

Roubini on Unemployment: 'The Worst Is Yet to Come'

@Adonis - No, it's not that people are willing to sit on unemployment and not take any jobs. It's that employers - now more than ever - are excruciatingly specific about what they want in new hires. Also, if you're a former exec and you're looking to just take anything (as many ARE willing to do), employers think you are ridiculously over-qualified. One former CEO got a job as a call center manager after many months of unemployment and considers himself lucky. Many others are out there, sending out resumes, emails, and making calls, but employers have few jobs, want extremely specific skills to exactly fit the job, and millions sit unemployed. I talk with employers frequently and I hear repeatedly that they post a job and get inundated with 14,000 resumes. It takes them forever to parse through the deluge and get the pool down to a manageable size for interviews. But, they all acknowledge that what they look for is someone who's done the exact same job somewhere else. Exact match. So, guys like that CEO are indeed lucky to land a job for which they are extremely overqualified and haven't performed in that role in two decades.

I believe the way to increasing jobs is through a package of investment tax credits for businesses that hire and make capital investments. Big incentives. Put the money there, Obama, then you won't have to throw it at the banks. Doing that does nothing for employment.

Employment in Crisis

Great article. I've been watching news each week about the jobs numbers, wondering just when the politicos or press would consider the distortion of our "official" unemployment numbers. Despite unemployment benefits extensions, we have a very large, talented, unemployed work force that has simply exhausted benefits. Last week, my local news carried a piece about an architect who was in that situation who's now taken to standing on the street corners with a sign, begging for a job/cash.

Clearly, our officials and press are sticking their heads in sand, or are trying not to stir up a mass panic.

'Clunkers' Spending Siphons Savings

Good piece and analysis of the savings issue. My comments...

1) On savings: With interest rates so low, there is no incentive to put money into savings and the Market is still too unstable for the average investor. Thus, when there's a deal like "Cash for Clunkers" out there, consumers react. I know a number of unemployed folks who actually pulled money from savings to go buy new cars under the program. Now, that's confidence in a job market rebound! Another reason for low savings rate is the unemployment rate. The unemployed aren't exactly in a position to do much saving as it stands today. Although a general tax break tied to savings contributions would be a good move. Even if you were living off unemployment, you still need to pay tax on it, but if you had the opportunity to swing some of those tax dollars into an IRA, you'd do it (pay yourself vs. pay it in tax). The idea is to open up the IRA contribution tax deduction to anyone (eliminate current limitations). Our government leaders and financial experts need to come together on some creative thinking and fast!

2) On consumer spending: As consumers cut back on spending, they turn to discount stores and 'big box' retailers for deals. Note Wal-Mart's sales are holding strong and I venture to guess that over 70% of their merchandise originates from outside the US (with around 90% of those imports from China). We could really use a national marketing campaign -- like Lee Iacocca pitching us to "Buy American!". I say that only half jokingly, because if you take a historical view of such campaigns (1978, 1992), they were effective in positively impacting the US economy. Specifically, 'Buy American' campaigns of 1978 and 1992 targeted Japanese car companies (which in 1978 began eating a big chunk of the US car-maker's lunch). The end result of the campaign didn't necessarily achieve the big goal of getting consumers to buy more American cars. Rather, it pushed Japanese car makers into building more of their cars in North America, boosting manufacturing in the US, providng new jobs. In 1978, foreign car makers built none of the cars sold in America in America. By 1992, Japanese-owned car makers were building 40% of cars sold in the US in the US. My point here is that we need to take action to retain more of our DPI here in the US. It's all about cash flow. If it's all flowing out, pretty soon, there's nothing left here. And, I'm not just talking about our handing over the the low-end consumer goods marke to Chinat. China is starting to eat our lunch on high tech stuff, too. This said, I've probably raised a healthy debate on the China trade deficit here, but this global economy is a pretty complex thing! Check this out: www.tnr.com/blog/the-a...

Stuffing Uncle Sam: Is More Trouble Coming for Mortgage Market?

There are a number of factors in play here, though certainly you've presented two: interest rates were low, enabling consumers to buy more house than they ordinarily would have, and unemployment has increased substantially, causing those consumers to bail. There are other factors, however:

* mortgage fraud: brokers and banks new that many consumers were unqualified, yet pushed loans through anyway

* over-valued properties: whether you call it fraud or negligence, appraisers significantly over-valued properties

...and a LOT of that occurred, which is why lenders are holding the bag now.

Microsoft: Whistling in the Dark

Thought-provoking article. I agree that MSFT could stand to learn a few things from the downfall of IBM.

I do think that MSFT has some moves left, but they truly need to develop some strategic plans to regain market share. I do think they could have an advantage in the mobile space, but again, they need to develop a unified strategy and organize resources around it.

I disagree with the author's implication that the Apple Tablet will grab huge chunks of the PC space. One very significant factor in the decline of PC sales is the netbook. Netbook growth is exploding because the offerings are packed with features and functionality. My own loaded Dell Mini 10 was under $350. While I do think Apple will find a slice of the PC market willing to pay $900 for a Tablet, that price will probably come down over time (like the iPhone and most other devices) and it will take greater market share. However, PC prices are declining at a rapid rate to fall in line with those of netbooks. The operative words here are "over time". If Microsoft doesn't act quickly, Apple, Google, and others will continue to eat their lunch and dinner.

If I were Ballmer, I would give some serious thought to spinning off some operations into independent businesses.

AT&T: The iPhone's Achilles' Heel

Sprint led the way with an unlimited plan. Tracfone (VzW reseller) just announced an unlimited plan. T-Mobile is said to have one in the works (voice/data), too. This is the next frontier: flat rate, unlimited, voice and data.



On Jul 20 12:30 PM Terri wrote:

> Check out this new company that will be releasing new phones in a
> couple of months that will blow the i-phone away!!!! go to www.mygvbiz.com/terris...
> and check it out!

AT&T: The iPhone's Achilles' Heel

Ssshh! Don't say "cap".
I've been reading comments and see that overall, iPhone users have a pretty good experience. I know the carriers capabilities and devices well, having been in the industry for many years. My choice? VzW and Windows Mobile. I can do virtually everything with it. Voicemail's never out. The network is rock solid. Never a service or billing issue that's not quickly remedied. So, if VzW gets the iPhone, would I bite on that? No. I'm a Windows Mobile cheerleader. I can do things with that device that most iPhone users might dream about. I've been tethering for a few years, too. While I don't use Slingbox yet, I do use CarryDVD and download movies that way.




On Jul 19 03:40 PM ktwalrus wrote:

> I dropped AT&T for my iPhone 3G when they refused to allow the
> SlingBox player to be used on the data network. Earlier, they had
> blocked apps that supported tethering. In my opinion, the network
> should be neutral as to what traffic/apps it supports. If AT&T
> wants to limit the use of their data network, they should put a usage
> cap on it. But, don't say that I can stream YouTube videos but not
> TV.
>
> Best $135 I have spent when I paid the termination fee to escape
> AT&T.

GE Results Validate Theory: Severe Economic Contraction

I watch business in China closely and I will tell you, China is not on the upside of our downslide. China is taking economic hits, too. The US is their biggest customer and with consumers clamping shut their pocketbooks, China's hurting, too.

The numbers around Harley Davidson are very scary. They reported that during the past quarter, their revenue was down 91%!! How can you keep your doors open when your income drops like that.

The thing that astounds me is that the banks have been bailed out by taxpayers and some of the "bailees" are now reporting profits. However, the taxpayer cash infusions are doing nothing to benefit consumers. Banks aren't lending. They're hoarding cash and posting profits. Until the cash starts flowing again, business and consumers won't spend and we'll never dig ourselves out.

I agree with your discussion here - it's not likely to rebound any time soon. I recently read Harry Dent's book and highly recommend it: tiny.cc/nzzuo





On Jul 17 11:24 AM Bjarne Jensen wrote:

> While I agree with your assessment of the economy I think you are
> under valuing the effect: I do not believe our economy will ever
> return. A look at world economic history suggests that we are in
> the process of losing the economic high ground to China and our economy
> is not likely to improve any more than England’s' economy improved
> when they lost the high ground to us or Spain’s' economy when they
> lost the high ground to England.
>
> Given the amount of debt overhang we have, if we lose the economic
> high ground our economy will soon look like Mexico's.
>
> Can't happen here? The three previously mentioned world economic
> transitions were caused by the same two conditions: The losing country
> had accumulated more debt than their economy could support and the
> losing country had such incredible hubris they were unable to see
> it and attempted to fix it by borrowing their way out of debt. I'm
> afraid that the debt funded spending spree is over and we're going
> to pay the price!

Syniverse: Recovering

I cannot imagine WHY Alltel and Sprint would move to insource this function. Given recent developments at both firms (VzW acquiring Alltel; Sprint layoffs of thousands), I would anticipate a change on this one...