goldenhinde

Less Government or Lower Wages? You Choose

Just exactly did you mean when you say "return". When exactly did we have a fiscally responsible small federal government. Andrew Jackson was the last President to elimnate the federal debt. That was about 150 years ago. I appreciate the sentiment though.


On Aug 16 06:55 AM optionsgirl wrote:

> I'm willing to endure the pain necessary to return to a fiscally
> responsible, small federal government that recognizes US citizens
> choose capitalism and democracy, the "old normal".
> There is no "greater good" than the protection of our individual
> rights and property.

Washington Drinking the Kool-Aid of Incompetent Economists

I think the word is sophmoric. Your article says very little of substance and is something I would expect from a sophmore in college who finds it easier to take shots than to offer solutions. To "predict" a collapse of manufacturing jobs by virtue of the political activity thus far is more "dah" than substantive. This is nothing new for the last 25 years. So, championing your predictive prowess is very nice but those of us wondering what can be done that is constructive cannot find an iota of value in your post.

I'd like to suggest that it is a good thing you aren't making policy and merely rant from the sidelines. Please illustrate capacity for thought in your next post.

Expecting the 'Better than Expected' from GE, Google and JPMorgan

I cannot imagine why some of you whose posts are so negative bother to get out of bed. Man, you guys need a break from the inside of your own brain.

$200 Oil Is Coming While We Waste a Perfectly Good Crisis (Part 3)

James: I appreciate the thoughtful research and I do not doubt that one day we will get there. That day will come sooner if inflation does roar its ugly head and slower if the dollar ascends the magical staircase of relative value. One thing that I don't see accounted for is Iraq. Iraq produces 2.3 MB/day now and wants to move that up to 6MB/day within three years. The US government is of course subsidizing that effort and the majors are ALREADY putting the resources in place to make that goal a reality. That will have Iraq be one of the largest producers in the world and they have proven reserves of 44 Billon barrels which will hold us up for a while.

I agree with you entirely that without being self sufficient in energy we are screwing ourselves and the future of this country. However, if Iraq comes on line it can replace a lot of what is otherwise drying up and can do it for years to come. This certainly moves the time of $200/barrel oil further out than what might otherwise be expected.

If we were smart, and yes, that is a big if, we wouldn't wait to get ourselves independent. Being a market based economy however, we are likely to stick to our philosophy and walk the tight rope into our own demise. My R friends will blame Obama. My D friends will blame big oil and they'll both be right/wrong.

We don't appear to accept the notion in this country of long range planning. Long range appears to be anything beyond the next mid term or Presidential election. Engage in such planning and the clowns blame government interference in the markets as the basis for why it should not proceed.

It is stunning for its stupidity - it doesn't matter what you call it. The more dependent we allow ourselves to be on others - the more we deserve the pain we create for ourselves.

Forest Gump knew better: "Stupid is as stupid does".

Rare Market Indicator Sighting: T2108 Over 90%

Good article - thought and full of data rather than some of the ususal down in the dumps commentary one finds in SA articles.

It seems to me that the landmines left in the field notwithstanding the real issue becomes not one of recovery - but WHAT TYPE of recovery. If the recovery is broad based then Mr. Market will respond in accordance with the commitment of capital on a more classic asset allocation basis. If the recovery is more methodical and slow i.e., GDP growth in 2010 is only 1% then stock picking skills will prevail over asset allocation strategies.

It seems to me that identifying those companies that are not drowning in debt, not relying on a balance sheet filled with good will, not holding on to bloated inventories (like tech companies often do), generating sufficient cash flow to handle their current obligations will come out of this well.

GE is an interesting play in this regard. According to an article in Business Week on GE, the stock is being valued on the basis of all of its industrial businesses. GE Capital is valued at next to nothing. On the one hand they have $45 billion in cash. On the other hand 40% of their consumer loans at the Capital division are of sub prime quality.

If the recovery is long and drawn out I cannot see how a classic asset allocation approach is worth the risk. The upside does not seem to balance the downside risk.

Current Popular Argument Against AIG Bonuses Takes the Wrong Viewpoint

Jim: Contracts are broken all of the time. Who are you kidding? It is standard fare for large companies to break contracts and then throw so many lawyers at the opposing side that they bury their opponent until they simply say uncle and give up or give in.

I do appreciate the sentiment you express, but you sound awefully naive.


On Mar 21 03:43 PM Jim in Virginia wrote:

> All of this is well and good but had they let the whole thing come
> tumbling down as bad as it would have been with a bankruptcy and
> the following fallout, we would not have been put in the position
> of the government (not a court) retroactively breaking a legally
> binding contract. We are a nation of laws or we are not. If any contract
> can be broken whenever public sentiment deems it necessary, we are
> in much deeper trouble than we are right now.

The Latest on Bank Nationalization

Oh yes. Nationalize the banks - absolutely. They and the people who directly or indirectly put them in the place they are in MUST suffer the consequences of their actions. Why must the taxpayer pay billions to support rotten balance sheets and be treated like a novice investor by owning small stakes in the institutions we bailed out.

The taxpayers should act like any other investor would act.

We will not get out of this mess until bank balance sheets are fixed. Recapitalize them, tank the existing holders of the capital structure - but for the secured debt holders and issues new shares. Take those shares and put them into the Social Security Trust where, as banks recover the securities can eventually be resold back into the market and the accumulated value can be used as a real funding source for the payment of future Social Security benefits.

The existing generation will be alleviating the intergeneration burden we otherwise place on our children but engaging in a process in which the promises made by our Social Security system can, in part, be funded rather than unfunded.

see sociallyresponsibleres... for more details.

The Latest on Bank Nationalization

Good article. "Too big to fail" as a concept is, was and has been flawed. It makes liars of those of us who otherwise believe that markets are as good a judge of value as anything else out there - but for government. Markets are better than government.

To my Republican friends I say this is the legacy of Reagan who took the concept of free markets and allowed them to become anything but free. The net effect of the Reagan years was to leverage balance sheets and replace the "honor" of building a company that will last - with the cleaverness of milking the assets built by others for all one could extract from it. There was no balance in that effort and we have been leveraging ourselves ever since.

By definition, American markets aren't free - or even close. How do I know. Large companies pay billions to lobby Congress and the White House to assure that they are not.

Large companies kill creativity and create a false sense of security. They kill jobs and have a culture that is antithetical to what we otherwise think of as American values.

If we really want to return to a more market based economy then let's bust up all large companies. That will, like the ATT of old, force management and the millions who work in such organizations to think and act like small business people - still the backbone of our economy and still the driver for this country's sense of freedom and liberty.

America's Insolvent Banks

Proposal: It is time that we eliminate the privatization of profits and the socialization of losses.

Summary (one page)
US taxpayers are being asked to incur massive debt to recapitalize insolvent financial institutions. While a sound banking system is required to drive economic activity – HOW we implement this rescue is critical. If the rescue of these institutions is adopted as proposed, (the “good” bank / “bad” bank proposal) we will recapitalize the same management, Board of Directors and oversight structure that created these catastrophic circumstances in the first place. If adopted, this proposal will effectively shield them from having to bear responsibility for their actions. In addition, it will impose a debt upon us that is so burdensome it will strangle our capacity for economic growth, threaten our liberty and diminish future opportunity for our children. There is no measure of maturity, honor or decency in encumbering our children with massive debt to pay for our generation’s mistakes and the inept management of our affairs. We must demand an alternative course of action from our government. This Proposal offers such an alternative.

In this Proposal we citizens propose that in exchange for US taxpayer infusions of capital all of the securities representing the ownership of these businesses (see Provision #3 for the exception) will be treated as though the business had actually made a bankruptcy filing. When US taxpayers recapitalize the insolvent institutions, a new class of shares shall be issued. Those securities will: (1) become the property of the US taxpayers and (2) be deposited into a Trust, called the Social Security Trust, for the benefit of all Social Security system participants.

As the business activity of the citizenry revives the economic vitality of these institutions, the value of shares in those rescued institutions will increase. As they increase in value they will become the financial backbone for the Social Security system – a system that now has no real assets but for the social security taxes taken from future payrolls. The SST shall be managed by a FIDuciary Oversight Board (FIDOB) whose members shall; be experienced investment fiduciaries, report directly to the President of the United States and be subject to oversight by the General Accountability Office. When there is clear evidence that the rescued financial institutions are stable, the FIDOB may examine the prudence of selling the securities to the highest bidder in the marketplace. While such a program would require the President’s and GAO’s approval, the proceeds from a sale will remain as SST assets.

By implementing the actions proposed in this Petition, we citizens of the United States will:
• recapitalize the financial infrastructure of the country,
• employ market-based principles consistent with the intent of our laws,
• substantially alleviate (not solve) the financial burden upon our children of paying for Social Security benefits we have promised to give ourselves,
• create a governance model grounded in and guided by an authentic fiduciary standard of care (not how banks or bank regulators operate now),
• establish a Trust with real assets that serve as a financial backbone for Social Security, and
• exemplify our President’s call for individual responsibility.

Please visit sociallyresponsibleres... to read the entire 7 page Petition and sign it.
Pass it along to friends, family and colleagues. Thank You.

Bank Nationalization: It's Just Plain Wrong

Check this out:

Proposal from Citizens of the United States of America
It is time that we eliminate the privatization of profits and the socialization of losses.

Summary (one page)
US taxpayers are being asked to incur massive debt to recapitalize insolvent financial institutions. While a sound banking system is required to drive economic activity – HOW we implement this rescue is critical. If the rescue of these institutions is adopted as proposed, (the “good” bank / “bad” bank proposal) we will recapitalize the same management, Board of Directors and oversight structure that created these catastrophic circumstances in the first place. If adopted, this proposal will effectively shield them from having to bear responsibility for their actions. In addition, it will impose a debt upon us that is so burdensome it will strangle our capacity for economic growth, threaten our liberty and diminish future opportunity for our children. There is no measure of maturity, honor or decency in encumbering our children with massive debt to pay for our generation’s mistakes and the inept management of our affairs. We must demand an alternative course of action from our government. This Proposal offers such an alternative.

In this Proposal we citizens propose that in exchange for US taxpayer infusions of capital all of the securities representing the ownership of these businesses (see Provision #3 for the exception) will be treated as though the business had actually made a bankruptcy filing. When US taxpayers recapitalize the insolvent institutions, a new class of shares shall be issued. Those securities will: (1) become the property of the US taxpayers and (2) be deposited into a Trust, called the Social Security Trust, for the benefit of all Social Security system participants.

As the business activity of the citizenry revives the economic vitality of these institutions, the value of shares in those rescued institutions will increase. As they increase in value they will become the financial backbone for the Social Security system – a system that now has no real assets but for the social security taxes taken from future payrolls. The SST shall be managed by a FIDuciary Oversight Board (FIDOB) whose members shall; be experienced investment fiduciaries, report directly to the President of the United States and be subject to oversight by the General Accountability Office. When there is clear evidence that the rescued financial institutions are stable, the FIDOB may examine the prudence of selling the securities to the highest bidder in the marketplace. While such a program would require the President’s and GAO’s approval, the proceeds from a sale will remain as SST assets.

By implementing the actions proposed in this Petition, we citizens of the United States will:
• recapitalize the financial infrastructure of the country,
• employ market-based principles consistent with the intent of our laws,
• substantially alleviate (not solve) the financial burden upon our children of paying for Social Security benefits we have promised to give ourselves,
• create a governance model grounded in and guided by an authentic fiduciary standard of care (not how banks or bank regulators operate now),
• establish a Trust with real assets that serve as a financial backbone for Social Security, and
• exemplify our President’s call for individual responsibility.

Please visit sociallyresponsibleres... to read the entire 7 page Petition and sign it.
Pass it along to friends, family and colleagues. Thank You.



On Feb 15 04:40 PM ClydeDNA wrote:

> Genie. I hate to tell you this but the innocent investors already
> lost their money, Citi for example who merged with the Wacos, is
> mostly owned by the commies (i.e. USA). I'm just kidding, but you
> know of course that Russia and China are not communistic at all.
> Those countries are run by capitalist dictators. Our country is a
> democracy with our leaders chosen by the people. It's too bad that
> human beings on the average are such a bunch of crap, otherwise getting
> rid of the Kings and Queens would have been fantastic! We replaced
> them almost world-wide with a bunch of nincompoops. Human beings
> need to do a better job at choosing leaders and then getting involved.
>
>
> Nitram. I know you want to punish those CEO that still have jobs,
> but except for Madoff, nobody is going to even pay a fine.
>
> The collateral that underwrote all those $trillions in loans is going
> down in value. The banks are broke! Hang the banker CEOs! …that's
> not going to help. What do we do now?
>
> First I want you to cheer up and face the future in a positive manner.
> Unless you got a car with a Flux capacitor, we are going forward.
> You know, this is the very first time that everyone I voted for actually
> won. I've voted a lot of times over the years. I'm going to stay
> involved as much as I can and hope for the best rather than worry
> about the worst. I'm going to stay positive about my life going forward,
> even though as Yogi once said "the future is not as good as it used
> to be".
>
> And I'm going to try to figure where all the money came from so I
> can figure where it's going -- and get some.
>
> video.google.com/video...
>

Four Dying Silicon Valley Companies

If you know anything about PALM you know that they are going to release an OS that will technically blew everyone away. This will happen in Q1. How much that will impact RIMM and Apple remains to be seen. However, a 1% market share is a home run for Palm shareholders.

It is always darkest before the storm and more importantly, if you think market intelligence comes from newspapers - you deserve your fate.

State Default Watch: Budget Deficit Heatmap

Get a grip Mowog. The Republicans put us into this frickin mess. Given your observation here another one back at you: let's have the "red" states pay for reconstituting the US economy. After all, you folks voted in these clowns and kept them there the second time.


On Nov 15 08:30 AM Mowog wrote:

> It seems like the more financially troubled the budget of a state,
> the more likely it was to vote for Sen. Obama. Expectations of "free"
> money for government bailouts?

Hidden Crash: The Dumping of Venture Funds

of course no one knows what the next great thing will be. However, a contrarian view is that there has NEVER been a better time to invest in American innovation. There are big hairy problems that must be fixed and the United States, right or wrong is one of the only places on the planet where it they can be fixed.

Venture funds will not move overseas because no one who has cash will innovate and let them it. The Arabs don't innovate. The Russians - yeah right. The Chinesse don't need our money so the impact of US centric VC firms will be minimal.

There is no other place. WE are it and therefore we had better get to work or our kids are screwed (more than we've already screwed them).

Why is McCain Playing Defense on This Market?

Anton: First, get a picture that doesn't make you look so mad. It is not flattering to you and makes you look - well, mad. Sorry to break the rather simplistic news to you but the market doesn't give a rat's ass about Obama in so far as he represents the least scary thing "out there".

The really scary thing is that Republicans don't recognize that the policies of their beloved Reagan are coming home to roost.

As other citizens wake up to the simplistic but accurate notion that the only thing that is different about Republicans and Democrats is that Republicans borrow and spend while Democrats tax and spend.

Frankly, while neither is a model of leadership, he Republican framework has burst and anyone who thinks that we ought to keep trying it - deserves what they get.

U.K. Limits 'Quality of Life' Meds to £30,000 a Year

I would like to suggest that health care rationing is the only rational approach left to health care. It makes no sense that we, as a country, put our economic resources to bear on extending the life of a 75 year old. I am sure their loved ones appreciate it. I am very sure of that. However, that is not the government's business.

There is no free market in health care. There never has been.

Oh yes, if you are fat, smoke and have other bad habits - you can pay for the consequences of that yourself. Don't bother coming to me to subsidize your bad habits.