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  • F-22 Spat Offers Proof of Government's Deficit Intentions  [View article]
    More proof that liberals are mathematically illiterate and have no business sense -- and more proof that Seeking Alpha continues to fill its pages with liberal propaganda

    First of all Ryan -- I will address you like a child until you act like an adult -- Social Security is not on the budget at all. Your statements about SocSec "budget" compared to military spending shows you don't actually understand the budget -- probably like your idiot hero Obama you have no business sense

    Second, Social Security spent $750 billion this year (all "off budget" even though it is money being spent). The military was budgeted $420 billion. What math class did you fail out of to decide 420 is greater than 750?

    Third, if you actually understood Social Security -- and you are clueless -- the actuarial deficit (future promises made versus cash collected) adds a lot more to Social Security's budget.

    The whole thing is a giant ponzi scam concocted by that other idiot with no business sense - FDR. Social Security is just old voters stealing from the next generation -- the program is immoral.

    Jun 26, 2009. 06:52 PM | 2 Likes Like |Link to Comment
  • Moody's Next Epic Failure: 'U.S. Remains a Solid AAA Nation'  [View article]
    Yes, the USA is a "AAA" entity

    So is Enron, Vahejo California, FNMA, FHLMC, and all those wonderful CDO deals Moody's assured us for years were solid as rocks

    The real "story" here is: why does anyone still care what Moody's thinks?
    Jun 24, 2009. 09:38 AM | 1 Like Like |Link to Comment
  • Health Care Reform Is an R&D Problem  [View article]
    In the approximately 6000 years of recorded human history, has there ever been a government that has consistently controlled costs over an extended period of time?

    Given how our politicians treat every other issue: Is there even a shred of evidence that our government will view health outcomes over a time horizon longer than the next election?

    Let me guess: you were one of those dot-com people who believed this time would be different
    Jun 24, 2009. 09:34 AM | 1 Like Like |Link to Comment
  • Mish Shedlock's Inflation Scorecard: June 2009 Update  [View article]
    11 out of 12 things you list are things that journalism majors like to talk about -- but have little if anything to do with inflation
    Jun 24, 2009. 09:23 AM | 1 Like Like |Link to Comment
  • Crude Oil Trading Regulation: A Terrible Idea Whose Time Has Come  [View article]
    An ultra liberal guy from Boston thinks the government should regulate yet another market.... film at eleven

    Wonder if the author knows that the junkie doesn't get to regulate the drug market? Does the author know the US is a net importer of oil?

    OPEC hasn't been able to manipulate oil prices, despite controlling far more of the oil market than the US ever did. Why does this author believe the US, which is dependent on oil imports, is going to achieve something the biggest suppliers in the world cannot?

    If the US is stupid enough to listen to people like this author, our economy cannot be saved. The government is not omnipotent and never was. Moronic suggestions like this is why the US is in long term decline

    Jun 24, 2009. 09:19 AM | 6 Likes Like |Link to Comment
  • My Thoughts on Oil  [View article]
    Fitz: The US has 5% of the world’s population and uses ~25% of the world’s oil. Since it imports 65% of its oil from foreign sources, it is more economically exposed to the price of oil than any other country on earth.

    Your first sentence is highly misleading. The US does use around 25% of the world's oil, but we also create 30% of the world's GDP. We are more efficient than most countries

    The second sentence makes no sense at all. Just as example: Japan is 100% dependent on oil imports, whereas the US is "only" 65% dependent.

    Why is oil going up? We have seen what enviro-terrorists have done to the energy policy in Europe. In an absurd attempt to fight higher temperatures that may or may not be caused by oil companies, Europe emphasized natural gas without bothering to figure out where they would get said gas... Now all of Europe must pay whatever price Vladimir Putin wants to avoid freezing to death.

    Obama is now indebted to similar extremists here in the US for his election. While alternative energy sources are probably a good idea in the long run -- they cannot make a dent in the next 4 years (or even 8). It took Brazil over two decades to switch to ethanol, and that was under a military dictatorship and with a lot less infrastructure to convert.

    What stupid energy idea will the crazies force down America's throat through their puppet Obama? Its anyone's guess, but one sure thing is that it will cost American consumers dearly
    Jun 2, 2009. 10:31 AM | 7 Likes Like |Link to Comment
  • Why Is California in Economic Trouble?  [View article]
    So Krugman, a "Democrat", blames the people for passing Proposition 13?

    The majority of voters don't want to pay for spending that grows faster than their ability to pay for it -- and they expressed their wishes at the voting booth.

    Now an elitist "expert" (who was granted his PhD by other elitist experts, not by proving his theories in the real world) is saying that, in a democracy, "we the people" should let the elitist experts spend money they don't have based on unproven theories -- and never mind what the actual real world workers think.

    And Krugman will call this system "democracy"

    Apparently, Princeton doesn't have any PhDs that can explain political systems to this Krugman "expert"
    Jun 1, 2009. 10:37 AM | 5 Likes Like |Link to Comment
  • New Jersey's Pension Crisis: A Canary in the Coal Mine?  [View article]
    By the way, its impossible to dispute that unions made enormous contributions to workers and the country 100 years ago. Pay was poor, working conditions were awful, etc. Unions didn't fix those problems, but they helped.

    Its also impossible to dispute that, once those problems were "fixed", and the Leave It To Beaver generation started -- unions became an absolute nightmare for workers and for the country.

    Textiles, steel, airlines, shipping, trucking, auto industries have all been destroyed by unions killing the goose that laid the golden eggs. Limits on changing work rules went from preventing worker injury to preventing any development or change at all. Pension benefits were received now, but somebody else was supposed to pay for them later -- they were always a ponzi scheme.

    Union leaders meanwhile have vast office space in Washington DC for "lobbying". The AFL-CIO building is huge, and well staffed. What, besides perpetuating the union bureaucracy does it do?

    Now the biggest union nightmare of all -- government employees -- are doing to the U.S. democracy what they already did to the steel, textile, airline and auto industries.

    Has there ever been a more coddled, over-paid and under-worked group of individuals EVER? Government employees supposedly get paid 70% of what private sector workers are paid -- but they are only about 10% as productive. They have to work slow and be unproductive to justify such a bloated headcount. Further, the 70% figure doesn't include all sorts of "overtime" scams, double dipping on pensions, shorter working hours, bigger holiday schedule, etc.
    May 23, 2009. 04:30 PM | 3 Likes Like |Link to Comment
  • New Jersey's Pension Crisis: A Canary in the Coal Mine?  [View article]
    As a few commenters have already noted, this is hardly a crisis -- its been planned for decades.

    The political welfare class (from government "union" members to supposedly elected bureaucrats) have been robbing the electorate blind for decades. Dumb Americans just sit there and take it. Heck, we are so stupid we turn around and want to have even more parts of our lives controlled and decided by these criminals.

    Obama is supposed to be smarter than Bush -- California is his first real test. If he thinks he can bail out California's welfare government, he will go down in history as the man who started the collapse of the United States.

    It took Communist hater Nixon to start a dialog with China. Perhaps a socialist like Obama can reign in the out of control spending and fraud that is government. Based on GM and Chrysler -- he is not off to a good start
    May 23, 2009. 04:18 PM | 6 Likes Like |Link to Comment
  • California Looking at Massive Budget Cuts  [View article]
    Mad Hedge Fund Trader--

    > Trashed at the polls were plans to create a rainy day fund, improve education, borrow from the state lottery, and pay for children’s services and mental health.

    Throwing more money at a problem does not necessarily improve anything.

    There is no evidence that education's problems result from a lack of funding. There is plenty of evidence that millions are wasted on administrative overhead. I don't know the numbers for California in particular -- but nationwide, the US spends three times as much per student as any other country. It sure doesn't end up in the classrooms or teacher's salaries. In addition, purchasing fraud (buying products at inflated prices from "friends of the superintendent") is absolutely rampant.

    Creating a rainy day fund is a great idea if you have actual money to set aside. How can you be running a hedge fund and suggest setting aside money when a lack of money is the whole reason for the referendums?

    Borrowing from the state lottery? California already borrows from the future. That's what all that federal government guaranteed debt is. Claiming to "borrow" from the lottery is just a scam -- its off balance sheet funding by another name. We have all seen the huge damage caused by accounting scams, and we aren't buying it anymore.

    California's political welfare class has been living off taxpayers for too long. They will have to go get real jobs. That is the only thing that can save California -- infinite taxes will just make the problem worse
    May 21, 2009. 05:04 PM | 7 Likes Like |Link to Comment
  • PIMCO's Kiesel: Three Reasons to Buy High-Grade Corporate Bonds Now  [View article]
    With the top-down P/E on the S&P500 around 26 or 27, it is far from obvious that stocks are "cheap". While we all know the "P" of stocks, the "E" part is a little dicey. Last year's earnings are not very helpful considering the dominance of financing companies in the S&P -- which will all see lower earnings this year.

    And as for forward looking earnings !!! Fool me once, shame on you -- fool me over and over again... What fool would possibly put any weight behind Wall Street's earnings estimates? These guys couldn't even predict the downfall of their own employers.

    Last year, corporate profit margins (as a percent of GDP) were at an all time high. Taxes are going up, the economy is shrinking, labor wants to restore its "share" of the pie. Corporate profit margins are likely to revert (lower) to their long term historical mean. Those margins will be applied to a smaller economy (its the recession, stupid!)

    All in, the forward P/E on stocks is in the mid to upper 20s. With Treasury interest rates low, this may be appropriate (depending on your view)... but stocks are clearly not "cheap" by historical standards. At best, stocks are fair priced -- at worst, they have further to fall.

    Assuming inflation picks up going forward -- history suggests that stocks will see PE compression. This happened back in the 1970s. The opposite (PE expansion) happened from 1982-2000 as inflation moderated.

    Likely PE compression is another reason to be worried about stocks in the next few years. Even assuming earnings recover (which is not guaranteed) -- PE compression could mean no price appreciation.

    Long term, stocks return about 6.95% (average from 1950-2000). With IG corporates yielding almost that, bonds stand a good chance of matching and possibly outperforming stocks over the next 4-5 years

    On Apr 14 03:15 PM Chris B wrote:

    > Would you have made the following investment plan a year ago?
    > I'll jump out of stocks and get into bonds IF stocks go down. Then
    > I'll jump back into stocks in a couple years IF they go up.
    > Of course not. How about this one instead?
    > I'll jump into stocks when they get cheap, buy up a few irrationally
    > discounted shares at low P/E's and ride them up into the recovery.
    > After 1-2 years, I will have enjoyed massive gains. By then, interest
    > rates and inflation will be on the rise. I'll switch into bond ETFs
    > at low prices after the fed has raised rates to deal with the risk
    > of high inflation.
    > As you can see, this is a buy-high, sell-low decision.
    May 17, 2009. 09:35 PM | Likes Like |Link to Comment
  • The Changing Composition of GDP  [View article]
    This article is a huge embarrassment for Zacks.

    The 20% number quoted by the author is for Federal on-balance sheet spending only. It doesn't count state or local spending, and completely overlooks all the other government financing vehicles mentioned by sabre_jenn above.

    Zacks obviously just regurgitates the news media and doesn't bother to understand the numbers. Seeking Alpha needs to do a better editorial job and restrict bad authors from publishing nonsense
    May 17, 2009. 09:16 PM | 1 Like Like |Link to Comment
  • Time to Reenter GE  [View article]
    Lummox -- your statement, GE mostly finances internal products and on a short term, is completely false:

    GE is the largest 3rd party consumer credit card issuer in the US. Hundreds of "store" credit cards are actually issued and serviced by GE Capital.

    GE Capital Leasing is the largest airplane leasing company in the world. Another section of GE Capital finances aircraft engines (not necessarily GE's own). GE Capital Leasing finances airplanes themselves, which GE does not make.

    GE also finances modular buildings used for temporary office space (often by construction companies). They finance shipping containers, rail cars, and trucks -- none of which GE makes. The lease terms generally go for at least a year. More importantly, the life of the asset (what GE has to finance) is many years. Having the lease expire while the loan on the asset is outstanding is the classic S&L maturity mismatch problem.

    GE Capital was a huge underwriter of mortgage backed securities -- even though GE is not a bank and did not create the loans. Mortgage loans are not short term.

    While the credit card loan age obviously varies with how fast consumers pay the charge back -- the majority of GE's financing goes on for many years. This is why PIMCO's Bill Gross said it was inappropriate for GE to be relying on short term commercial paper years ago (long before Lehman's issues). Jeff Immelt conceded the problem and worked to secure longer term financing with varying success... hence your suggestion that GE's loans are short term is just plain wrong and has been refuted by GE itself.

    And your statement:
    > It didn't need TARP, it needed cash.
    betrays that you don't really understand what the TARP program is

    On May 17 08:02 PM Lummox wrote:

    > GE Finance is different from most other banks. The majority of their
    > loans are for financing their internal business divisions. These
    > are all short term loans or leases. So it made sense to get financing
    > from the money market. After Lehman's collapse, the market dried
    > up and GE, couldn't get capital to finance their Sales. So the converted
    > their finance arm to a bank, so they could get money directly from
    > the FED. During this time money market accounts were hitting 24%.
    > It didn't need TARP, it needed cash.
    May 17, 2009. 09:01 PM | 5 Likes Like |Link to Comment
  • Time to Reenter GE  [View article]
    buoy -- you should read GE's annual report some time. GE is already in China and India. They have been in both countries for many years. Both countries are already "on line"
    May 17, 2009. 03:50 PM | 3 Likes Like |Link to Comment
  • How Should We Improve Seeking Alpha's Comment Rating System?  [View instapost]
    I have seen John Lounsbury rip other commenters apart (without cause in my opinion) -- yet he is consistently ranked #1 in comments. And now he comments here and wants to create an "elite club" with super voting rights to further cement his standing. It would be more honest if you change the site name to "johnlounsbury.com"

    I stopped paying attention to the ratings months ago. When someone makes a comment that is even slightly critical of Obama, you get massive down thumbs. When someone writes something anti-Bush, you get massive thumbs up. The mainstream media is already slanted, we don't need a repeat here. Further, partisan rants have nothing to do with investments.

    I have to echo the point made initially (I think) by ramisle -- that SA needs to pay more attention to the accuracy of what authors are writing. I have noticed a number of errors -- including a case where the author recommended dividends that had stopped paying (I am not sure if it is the same article ramisle saw). There are a HUGE number of articles that "report" whichever political party's talking points and propoganda -- and report these as fact. Neither party is being completely honest, so any author that wants to claim "analysis" should really be talking about the pros and cons of whatever argument.

    You won't find Alpha by regurgitating either party line.
    May 15, 2009. 12:30 PM | 2 Likes Like |Link to Comment