bergl328

Some People Just Don't See the Recession

Ok, here's my take. I'm a Liberal (on most things) and I'm reading comments from two "conservatives" who both have their heads up their asses. I agree with your comments about User 141119 - he's to ignorant to understand what's happening around him and understand it. I also see the things you do and agree with what you wrote, up to the point where you said you wanted lower taxes, less bureaucracy and pro-capitalism. That's were I think you are a bit to myopic. Wouldn't a capitalist welcome the "Cintras' " of the world? Or does it just bother you that it's happening here in the US now?

The US has used the World Bank to put many countries into the same position that we are now facing ourselves. We loaned money knowing it couldn't be payed back and the told those same countries to take the bitter pill and reduce government size, become fiscally responsible and to sell of their infrastructure too reduce costs. Corporations of the World Bank participants then went in and bought up the water companies, utility companies, etc, at a fraction of it's value and then proceeded to raise prices on those that could barely afford to pay them to begin with. (And conservatives wonder why no one likes the US anymore.)

I'd love to have no or low personal income tax, but I don't see it happening. It's our tax dollars that the World bank uses (at least 51% is) and it's companies that profit. Companies make poor business decisons, assume more risk than prudent to bolster profits only because they know there will be no consequences for them - the government, using out tax dollars will bail them out and, while we're at it. let's just give them another $50B so they don't have to spend any company money. How often have we seen this scenario - Automotive industry, Aircraft industry, Savings and Loans, Insurance, Banks, Brokerages and on and on. The companies get more incentives, more tax breaks, more favorable legislation and the individual tax payer bears the burden in higher taxes and prices.

Each time we go through one of theses messes more beauracracy gets established to deal with it and the companies wind up in better shape and the individual in less. I realize that there are complex interrelationships here, but the only way to ensure that this doesn't keep happening over and over again is to not bail the companies out with tax payer dollars. If they fail they fail. Shareholders should be able to sue the respective corporate boards and leadership for mismanagement and I think. they would, in future, think twice about the companies that they invest in.

Take a look at the playing field and I think you will agree that it is strongly skewed in favor of business. If you agree with that perspective then I believe you'll gain a better understanding of the whole.

Sliding Dollar Turns U.S Into World's Discount Mall

Why are you surprised? When was the last time the good of the people came before the good of corporate profits?

The China Bubble Can't Last

China will do what is good for China and to sustain their growth. I believe, that to get a handle on whats going to happen in the Chinese economy you must apply the Chinese point of view, not a Western one.

Buybacks in Fashion, Market Headed Higher

Mark, thanks for your considerd reply. I believe we are on the same page on the economics. I added a social element because, I believe, at some point in time it will be a social event that, independent of the markets themselves, will impact the markets negatively (be it protectionism, isolationism, or the "ism" of the day). If returns are our only consideration, then who owns the assets does not matter. I was thinking more along the lines of "at what point will foreign ownership impact US political and financial policy and strength". Many articles have been written about how China is financing US war spending, or the impact of a sudden pullout of Chinese funds from our economy. I don't know your age, so you may not remember the '70's when the Japanese were buying real estate, golf courses, hotels and radio stations. It was good for business but as it continued there appeared greater and greater anti-Japanese sentiment. There is much more money coming in now and, given the current political climates, greater global competitiveness and the increased sense of insecurity many Americans are feeling (rational or not), I feel that there may come a day when people will feel the farm has been sold out from under them, thus inciting the social event I was referring to (i.e. at what point will people feel they don't have total control of their country anymore). For the long term I remain bullish on the markets, but I'm keeping a much stronger eye on the social side of things for market timing. I apolgize for taking the discussion beyond your initial scope and appreciate that you recognized the point I was trying to make. Look forward to more of your posts.

Buybacks in Fashion, Market Headed Higher

I agree, buybacks will raise the share price but, I believe, you stopped short of taking your premise to it's full conclusion. Buybacks are 1: an artificial way of inflating the price and 2: a means of consolidating ownership among fewer and fewer people.

It's the second point that is really worrisome because it's the (relatively few) billionaires that will ultimately own all the companies. They have the means to weather the ups and downs where the average invester may have to take their profit (or stop their loss). If the buybacks then continue ownership will continue to dwindle down to a smaller and smaller group.

If buybacks continue at the rates you stated a few people will own all and the majority will just be consumers and at the mercy of the few who now control production.

Eventually, I guess, after the consumers have been sucked dry, the effects will force downward pressure on share price again, but by then who will be left to buy and how far down this road are people willing to go for a short term profit (and will there be a U-turn at the end?)