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It's Like That...And That's The Way It Is By Charles Payne

So, I'm driving home last night listening to the greatest hits from Run-DMC when "It's like That" hit me right in the forehead. The 1983 hit has lyrics that - sadly - ring true today.

Money is the key to end all your woes
Your ups, your downs, your highs and your lows
Won't you tell me the last time that love bought you clothes?
It's like that, and that's the way it is

Bills rise higher every day
We receive much lower pay
I'd rather stay young, go out and play
It's like that, and that's the way it is

Government tabulators made it official, but most people already knew their incomes, already in a long downward drift, have begun to spiral much lower. Yes, bills like gasoline and groceries rise higher every day, and most are lucky to get any pay. And now, there is real disappointing news from the CBO on Obamacare. Because of lingering high unemployment, sagging wages, and states opting out of Medicaid, there will be 30 million people without healthcare insurance with six million having to pay the penalty, up from two million the last time the CBO combed through the numbers.

The taxes range from non-compliance, to the new healthcare kick-in for those with incomes above 500 percent of the poverty line, which comes to $60,000 for individuals and $123,000 for family of four. That's a massive tax hit for families significantly under that $250,000 threshold promised by the White House. While those folks are paying this tax bill a lot of others will not, including illegal immigrants, members of Indian tribes, low-income households, those with religious beliefs, and up to 12 million that will get an out via hardships.

This is going to prove to be the biggest scheme for income redistribution ever, and it's not going to end well for anyone. It will be yet another reason not to try to make the transition from poor to rich, which is becoming like those African gazelles making a big river migration through crocodile infested rivers and lions on the other side of the shore.

Wars going on across the sea
Street soldiers killing the elderly
Whatever happened to unity?
It's like that, and that's the way it is

I realize we are out of Iraq responsibly, but that country is in great turmoil. I think within a decade, we will be back. The Afghanistan timeline seems to have emboldened attacks. Sadly, many are coming from people America trained and trust to walk among our great men and women with weapons. But, it's street soldiers killing the elderly in Syria that I cannot believe is happening. America backed the civil war in Libya by claiming Khadafy was ready to slaughter his own people. Well, up to 30,000 people, including elderly and women, have been slaughtered by Assad. I guess we had to secure oil for Europe, and using Libyans as pawns was the easiest way to pull it off.

Unless there is a major find in Syria soon, the blood will continue to pour into the Mediterranean.

Disillusion is the word
That's used by me when I'm not heard
I just go through life with my glasses blurred
It's like that, and that's the way it is

Disillusion is a word that drips from the lips of too many people these days. I call it the dropout nation with people exiting the job market, marriage, children and choosing apartments over homeownership (that good housing number yesterday shows first time buyers down month to month and year to year). This is the one piece of the puzzle that frustrates Ben Bernanke, because all the money-printing in the world cannot spark enthusiasm on Main Street. There are long term implications from mass disillusionment.

You should have gone to school, you could've learned a trade
But you laid in the bed where the bums have laid
Now all the time you're crying that you're underpaid
It's like that (what?) and that's the way it is

For all the outrage about Romney's comments on the 47%, few people want to be honest about the crisis of sloth in America. More and more people that drop out can't get back in because the sofa is too soft and the benefits too good to be afraid. I'm always shocked when someone that can't read complains about opportunities or potential salaries. The cover of fairness is a damn shame because not only does it financially punish those that make the effort, but it attempts to shame those people as well. In a market-driven society, you typically earn more money based on learned skills.

Sure, a great slap shot can make up for trouble with eight grade math, but those instances are rare, indeed. For now, America is about largely rewarding merit, and that's the way it is! Hun!

Corporate Warnings

After the bell corporate earnings warnings were coming from all over the place in disparate industries.

Norfolk Southern (NYSE:NSC) says it will earn $1.18 to $1.20 per share, but the Street had modeled for $1.63. Management blamed lower coal (man the EPA's body count is rising fast), lower merchandise sales (belies sales results from retailers) and lower fuel surcharge gains.

Bed Bath & Beyond (NASDAQ:BBBY) posted earnings of $0.98 per share, but the Street was expecting $1.02. Moreover, gross margin decreased to 39.8 from 41.1 while operating margin slipped to 14.1 from 16.0. This stock has become something of a proxy for the housing market, and of course represents retail, too.

Over the past couple of years investors have caught a break with lowered expectations, but that dynamic is changing along with the onus of having to justify higher valuations. It's this kind of backdrop that can put a seal of approval on a rally and add octane or douse the action with renewed skepticism and disappointment. The next round of earnings coupled with the September jobs report could set the tone going into 2014.

More Signs the Bailouts Worked

The never-ending campaign to promote government bailouts will not talk much about news from Bank of America (NYSE:BAC). You heard "we" made money on AIG, which isn't a fact since the government needed to sell its stake at $43 a share but used convoluted stuff to get the media to cheer yet another successful bailout. Just how should these bailouts be measured?

When businesses fail, they should go the way of dinosaurs and if salvageable they should go the bankruptcy route. There is no way the government should step in to decide the difference and tilt the scales of free market laws. That being said, if a government wants to control industry there is no better time to pounce than in a panic.

The Panic of 2008 opened the door for government to make its move. The banks were saved; Chrysler and GM were saved, although the free markets wouldn't have allowed either to go the route of dinosaurs. Then there's Fannie Mae and Freddie Mac - absolute disasters that one day will be cheered as success after time and market manipulation work their magic.

Once again, I ask how bailouts should be measured for success.

If we are using taxpayer funds then these bailouts should work for the greater good which ironically is the stated mission of the socialist movement within this administration and the notion of shared prosperity. I don't get why, as a small businessman, I should pay more for society at large, yet massive billion dollar uses of our tax dollars should only make rich executives richer, give government more power over key industries (the administration refuses to sell its GM stake because GM may focus on making great cars and money rather than using needed capacity to produce cars nobody wants) and tumble into the pockets of political donors.

Bank of America is cutting 16,000 more employees this year by reducing branches and mortgage operations. The move will save the company $8.0 billion by 2015 and leave it with smallest head count since 2008. Tell the tens of thousands of former Bank of America employees the bailout worked. Tell the hundreds of thousand small businesses and would-be homebuyers now with fewer options the bailout worked. Even before this news Bank of America has seen a dramatic decrease in credit extended in this nation. Last year, the bailed out bank cut credit extended in America by $200.0 billion dollars from 2009.

Now I can see why we should cheer these bailouts.

Between TARP, a secret $13.0 trillion lending program, and funky accounting, banks were able to pay back taxpayer loans with interest.

The media has cheered and the White House has cheered, while Main Street has fewer workers and fewer chances to cheer or reach their own goals. The bailouts are a complete flop.

I'd like to hear your thoughts, reach me at

We aren't forcing the issue this morning as the market takes a pause to digest all the news from last night and this morning.