Democrats & Liberals Archives

Economy Anyone?

Many important issues have gotten lost in all the circus of the nomination campaigns - Iraq, global warming, spiking oil prices, troops losing and taking their lives, and a sinking economy to name a few.

I am sure it is just the usual "follow the spectacle," but there does seem to be a plot to bury the story of the economy - and the story behind the story.

Remember the so-called "sub-prime" mortgage crisis, with the efforts to portray it as lenders giving mortgages to folks who had "bad" credit? This was spun (briefly before even this disappeared) as "those folks got what was coming to them." However, the issue was (and is) less about borrowers with "bad" credit than those who had not built a credit history. It was also about rich folks trying to cash in on a peaking housing market, and developers doing the same (emphasis mine):

Similar to other banks, most of Umpqua's credit problems have come in the residential sector. About 75 percent of the loans now lumped in the troubled category as "nonperforming assets" are loans to residential developers, said Ron Farnsworth, Umpqua's senior vice president for finance.

Who is really getting slammed by the mortgage debacle?
Women - who were 40% of the borrowers in Baltimore, half of them "sub-prime."

Racial minorities who after struggling to get into the housing market (and hence wealth building) have lost more ground than they gained - an estimated $163 to $278 billion by the time the crisis is over. There is almost a 40% difference in the mortgage losses between whites and racial minorities - a clear signal of ongoing institutionalized racism.

More than 2 million subprime borrowers face higher mortgage costs and the possible loss of their homes if they cannot meet the payments. Studies have found that blacks and Hispanics were likely to be charged higher interest rates on subprime loans than whites with similar credit ratings. (Predatory Lenders Still Seen Targeting Minorities)

Renters whose landlords took the bait on the "easy" and "creative" credit terms. And yes, those renters are more likely to be women and racial minorities. Renters are facing skyrocketing rents and evictions as landlords try to recoup their losses. It is estimated that 20-45% (depending on the area of the country) of the mortgage foreclosures are on rental properties. Further, many of those losing their homes are also losing both deposits and a month's rent. Not surprisingly, more than a few are going from apartment dwellers to homeless.

The China Daily reported that the world stock exchanges lost $5.2 trillion in January in fallout from the U.S. mortgage collapse, and the early estimates of mortgage losses are $400 billion - which seems on the low side to me.

But, to speak of these "losses" is duplicitous at least. That $400 billion is in somebody's pocket, as is the $5.2 trillion in losses (it is called profit-taking). I don't have the resources to determine where that money went, but it is pretty clear where the bailout money is going.

According to a report in the Feb. 18, 2008 Financial Times, banks borrowed $50 billion from the Federal Reserve in January. They did this through an instrument initiated in December 2007 to improve liquidity in the market called a Term Auction Facility (TAF). This offers lenders below prime rate, short term loans. Other central reserves in Europe have similarly pumped money into the market.

While purportedly aimed at staving off a credit crisis, the Financial Times states that analysts are nervous about the lending scheme:

"The TAF . . . allows the banks to borrow money against all sort of dodgy collateral," says Christopher Wood, analyst at CLSA. "The banks are increasingly giving the Fed the garbage collateral nobody else wants to take . . . [this] suggests a perilous condition for America's banking system."

Indeed! Here we have a situation where the U.S. government deregulated banking, setting up a Ponzi scheme for both the credit and mortgage markets, which accelerated a housing bubble which has burst at the same time as the risky loans (not risky borrowers) hit their margins. Then, those engaged in the fleecing of borrowers (particularly borrowers faced by systemic predatory and discriminatory lending practices) are "bailed out" with our tax dollars, so that they can continue to fleece the people.

Not to leave the well-heeled behind, the economic "stimulus" plan signed by Bush has a little present for those in the high-priced home market. Namely, the limit on government backed home loans have jumped from $400,000 to $729,750 and jumbo loan rates are dropped 1%.

The change in loan limits, which allows the federal housing agencies Fannie Mae and Freddie Mac to purchase or guarantee the mortgages, is intended to encourage lenders to write more mortgages because they can easily sell them to the agencies.

Yes indeed. Sell those attractive "jumbo loans" to the same folks who created the sub-prime crisis.

Given all this expropriation of the wealth of the people, it is not too surprising that there are a growing number of folks who are looking beyond recession to an "economic meltdown." Martin Wolf reports on Professor Nouriel Roubini of New York University's Stern School of Business. Roubini predicts the worst housing crash in U.S. history which could take about "$6,000bn in household wealth." He estimates that about 60% of all mortgages originated in 2005-2007 had "reckless or toxic features." Sixty percent ... the crash could impact over 10 million households.

From there on we have what amounts to a domino effect - which we are already starting to see. Sub-prime leads to prime leads to credit leads to a rapid downward spiral.

In all, argues Prof Roubini: "Total losses in the financial system will add up to more than $1,000bn and the economic recession will become deeper more protracted and severe." This, he suggests, is the "nightmare scenario" keeping Ben Bernanke and colleagues at the US Federal Reserve awake.

Walden Bello writes Capitalism [is] in an Apocalyptic Mood over at Foreign Policy In Focus:

Skyrocketing oil prices, a falling dollar, and collapsing financial markets are the key ingredients in an economic brew that could end up in more than just an ordinary recession. The falling dollar and rising oil prices have been rattling the global economy for sometime. But it is the dramatic implosion of financial markets that is driving the financial elite to panic.

F. William Engdahl writes at the Centre for Global Research, that the cascade will hit the global economy - not just the U.S. economy. Something that we are already seeing in both Asia and Europe. The initial reason for the global impact was the packaging of the sub-prime loans with other debt instruments and selling those packages to big investors who sold them on. Deutsche Bank being the object lessen in Engdahl's article. A ruling by an Ohio court that the bank could not foreclose on fourteen homes in Cleveland. This means that foreign mortgage holders (and there are a bunch of them) are going to have difficulty claiming the assets underpinning the failed loans.

However, what Engdahl, Bello, and Martin really don't state is that the reason this is not just a sub-prime loan issue is that the loans were not sold to investors as sub-prime loans. The loans were packaged and repackaged until it was impossible to separate sub-prime from prime from stock offering. While this might have been "creative," it will also making sorting out who did what very difficult as each investment house apparently repackaged the "investments" again - effectively blurring any fingerprints that might have "stuck" to the "packages."

This is where the profit - not losses - comes in. At each step along the way these monies were effectively laundered before they were sold on (at a profit) to someone else. Now, when the house of cards falls apart, the central banks step forward to offer sub-prime loans to the financial industry. However, while sub-prime is interpreted as "risky" when they are selling houses to "just folks," it is good business and national economic policy to give financial institutions sub-prime loans.

Do you think it is accidental that the same term is used for purportedly opposite situations?

Posted by Rowan Wolf at February 25, 2008 10:11 AM
Comments
Comment #246383

Yes, most voters seem to sense something about the economy, prompting them to place the economy at the top of their list of concerns.

Economic meltdown is not at all far-fetched, when you consider the impact of 30 years of these 10+ ABUSES (which did not all come about by mere coincidence).

  • (01) Lawlessness
  • (02) Wars
  • (03) Plutocracy / Kleptocracy
  • (04) Illegal Immigration
  • (05) Election Problems
  • (06) Debt and
  • (07) Inflation / Usury / the Monetary-System is a Pyramid-Scheme
  • (08) Regressive Taxation
  • (09) Insufficient / Inadequate Education
  • (10) HealthCare or DangerousCare?
Yet, there is almost total silence on many of these issues.

Many voters are desperate for CHANGE, but too many voters are looking for a leader to do it ALL for them, while too many voters lazily and foolishly forget (again) that whoever the next president is, the next president will not be likely to CHANGE anything (for the better, that is) when too many voters continue to repeatedly reward most incumbent politicians in Congress with 93%-to-99% re-election rates, despite the majority of voters polled that give Congress dismally low 11%-to-18% approval ratings (www.reuters.com/article/topNews/idUSN1844140220070919).

Perhaps enough voters will notice the obvious correlation (between corrupt incumbent politicians and the majority of voters that repeatedly reward incumbent politicians with very high 93%-to-99% re-election rates) when the abuses perpetuated by those politicians make enough of the voters jobless, homeless, and hungry?
After all, pain is often the only thing that finally trumps apathy, complacency, irrational fear fueled by the clever and distracting partisan warfare, laziness, and blind partisan loyalty.

At any rate, the voters will still have the government that the voters deserve.

Posted by: d.a.n at February 25, 2008 12:29 PM
Comment #246392

I agree with most of everything said so far. I would like to add that: to me it appears that yes Amercians are desperate for change but are inactive and lazy voters. Some will vote on a single issue (guns,abortion, so forth), some because somebody gives good speeches, some because of what the media says, some just because there’s something about them they don’t like, and the list goes on. Very infrequently do you hear someone say they aren’t voting for someone because they did research on that candidate. Anytime I question someone about why they aren’t voting for someone or ask them to defend their statements about a particular candidate-they are unable to give a well thought out reply.

The economy is a major issue but I just don’t see how we can do much for the economy until we quit spending in Iraq.

I think we get what we deserve. If Americans aren’t going to put any effort into really learning about a candidate then we can’t expect anything different than what we already have.

Term limits for congress would go a long way to fixing congress’s problems. I think we should also get to vote on whether congress gets a raise or not. The people I work for decide if I get a raise-I don’t decide this. There is much in our system that needs to be changed but many people sit at home on their butts watching TV, playing video games, or looking for love on the internet. Most Americans express displeasure constantly with congress/govt but do nothing to actively make change.

Posted by: Carolina at February 25, 2008 2:20 PM
Comment #246394

I read in the “Economist” this week that real estate in UK is much more overvalued than that in the U.S. and that Spain (with an economy less than 1/10 the size of the U.S.) has more unsold houses than the U.S. The real estate boom did not start in the U.S. It is only that the U.S. is the world’s biggest economy so it makes more of a difference.

Over the past eleven years (the price boom started in the U.S. in 1997) prices of houses have gone too high for many people to afford. THey need to come down. This is a good thing. The adjustment is hard, but the alternative of pricing many people out of the market is worse.

The reason I give you some background on real estate worldwide and when the bubble started is because it shows why this election should not be about that. It started when Clinton still had four years to go in the Whitehouse and is worldwide and not only or starting in the U.S.

All bubbles burst. We had a similar problem in 1989 with real estate and in 2000 with stocks. The problem is that nobody wants to rein in the good times so they go on too long. The adjustment hurts and teaches a generation of borrowers/investors to be more careful. Then it happens again.

If you bought a house anytime before 2005 and are still living there, you made a significant amount of money on the investment and your real housing costs are lower than when you bought. If you bought regularly and held stocks during the last ten years, you are significantly ahead. If you bought and held stocks starting in 2003, you are really far ahead.

Posted by: Jack at February 25, 2008 2:29 PM
Comment #246399

If you bought stocks when Bush took office, your portfolio has not kept pace with inflation. In real terms, after seven years, you are losing money.

If you bought a house or refinanced since 2005, sorry. Better luck next life.

Just remember, the booms and busts of an unregulated market are good for you. Well, not you in particular… I mean, the wealthiest 1% of the population who benefit from privatization and deregulation. If “you” happen to be a member of the middle class, sorry. Better luck next life. Sorry to interrupt. The movement of wealth from the lower and middle classes, to the upper classes, will now resume.

Posted by: phx8 at February 25, 2008 3:39 PM
Comment #246404

Phx8

YOu should get a new stock advisor. Nobody should buy on any paricular day. If you bought stocks every two week from the day Bush was sworn in until today, you made good money. To avoid loses, you would have to have sold the year BEFORE Bush took office. My small cap fund lost 15.77% in 2000. The downturn started under Clinton, so it is a little unfair to start the clock before Bush had a chance to do anything at all.

If you bought a house in the last two years, you lost money. If it happened to be the first house you even bought, you have had bad luck, but if you bought it as a home, you are still in the same position you were when you bought it.

If you refinanced after 2005 you have not been affected except to the extent that you took profits from your house. You are no worse off BECAUSE of the refinancing. I refinanced last year to encompass another loan. My only regret is that I did not wait until now when I could get a cheaper rate. I may refinance again in March.

I ask again, do you want home prices to stay so high that ordinary people cannot afford to buy? It would be better if prices could come down slower, but it is a good thing that they are coming down. Prices went up way too fast from 1997-2006. Those already established in homes benefitted mightily, but it was pricing people out of the market and pushing them too far out of town. This adjustment is healthy.

BTW - I “lost” a pile of money on my house since it is worth maybe 15% less than it was in 2006. How does that affect me? Not at all. The house is still the same. The same goes for everybody who was not overextended in the first place and counting on increasing values to bail them out.

Posted by: Jack at February 25, 2008 4:27 PM
Comment #246408

Jack,
People don’t get to play “if” with their mortgages.

If prices run up too high, people may not be able to afford housing in that area. They may be shut out, and forced to rent, or lease, or relocate. That’s a shame. But in that case, the “if” does not mean financial ruin. It’s not the same as buying a house and then being “upside down.”

Being “upside down” would not be a problem if it were just a matter of waiting out an economic downturn. The problem is that the economy relied so much on refinancings in the first place, in order to support consumer spending; and the problem is that real wages are declining, because price increases with food and energy are eating up more and more of household budgets. It sets up a self-reinforcing cycle of housing downturn, lack of consumer spending, foreclosures, huge amounts of debt, commodity fuled inflation due to
a declining dollar, which is declining in part because of a huge nantional debt, and so on.

As for stocks, the only fair way to measure is begin from the date a politician takes office. At some point- perhaps months, perhaps years- the influence of the previous administration’s policies can no longer be included.

Posted by: phx8 at February 25, 2008 4:52 PM
Comment #246410
Carolina wrote: I agree with most of everything said so far. I would like to add that: to me it appears that yes Amercians are desperate for change but are inactive and lazy voters. Some will vote on a single issue (guns,abortion, so forth), some because somebody gives good speeches, some because of what the media says, some just because there’s something about them they don’t like, and the list goes on. Very infrequently do you hear someone say they aren’t voting for someone because they did research on that candidate. Anytime I question someone about why they aren’t voting for someone or ask them to defend their statements about a particular candidate-they are unable to give a well thought out reply.
Carolina, How right you are.
  • (01) Most voters don’t know that Do-Nothing Congress enjoys 93%-to-99% re-election rates, but most voters continue to reward Congress with very high re-election rates.
  • (02) Half of the voters don’t even bother to vote at all.
  • (03) Most of the voters that do vote blindly pull the party lever, rewarding irresponsible incumbent politicians, despite the majority of voters that whine and complain about a corrupt and dysfunctional Congress and give Congress dismally low 11%-to-18% (www.reuters.com/article/topNews/idUSN1844140220070919) approval ratings.
  • (04) Most of the voters simply can not overcome their blind loyalty to THEIR party.
  • (05) Too many voters are:
    • too complacent, apathetic, and lazy;
    • too blindly loyal to THEIR party, and have abdicated their responsibility to think, and reason, and vote responsibly to THEIR party;
    • too ignorant; that’s no excuse; it merely makes ‘em a good target for abuse;
    • too irrationally fearful of the OTHER party winning seats, so they ALWAYS pull the party-lever (i.e. vote straight ticket), the politicians are experts at fueling the partisan-warfare, and some voters are all too happy to wallow in the circular, divisive, blame-game, distracting partisan-warfare; oblivious to the way the way their politicians distract and manipulate the voters;
    • insane and delusional; after all, what do they call it when you do the same thing over and over and expect a different result?
  • (06) Too many voters are single issue voters (i.e. I want health care! ). Thus, they are easy to manipulate.
  • (07) Most voters do not even know who their Congress persons are, much less their Congress persons’ voting records.
  • (08) Most voters rather wallow in the petty, partisan-warfare, and demonize and blame the OTHER party, because that is easier then admitting that THEIR own party is really no different than the OTHER party. Both are so corrupt and irresponsible, there is truly no significant difference, as evidenced by their voting records and the decline of the U.S. over the past 30+ years.
  • (09) Most voters can not name 10, 20, 50, 100, 200, or even 268 (half of 535) in Congress that are responsible and accountable, but those voters repeatedly reward the same irresponsible and corrupt incumbent politicians with 93%-to-99% re-election rates.
  • (10) Most voters fail to understand these 10+ ABUSES that have been cheating Americans for over 30 years; abuses that did not all come about by mere coincidence;
  • (11) And in this upcoming 04-Nov-2008 election, too many voters will probably focus only on the office of President and Vice President, continue to repeatedly reward irresponsible incumbent politicians in Congress with perpetual re-election (despite Congress’ dismally low approval ratings of 11%-to-18%), and saddle the next President again with the same dysfunctional, irresponsible, corrupt, FOR-SALE, Do-Nothing Congress, and the nation’s pressing problems will continue to grow in number and severity, threatening the future and security of the nation, as the U.S. decays into total fiscal and moral bankruptcy.
There are several reasons, and laziness is one of them:
Carolina wrote: The economy is a major issue but I just don’t see how we can do much for the economy until we quit spending in Iraq.
That’s one of several things that can be addressed.

They aren’t new things, so much as things (the 10+ abuses above) that we should STOP doing.

Carolina wrote: I think we get what we deserve. If Americans aren’t going to put any effort into really learning about a candidate then we can’t expect anything different than what we already have.
Carolina, I agree with that 100%.

The voters will have the government that the voters deserve.
And people, like yourself, who now understand it so well, keep saying that.
Otherwise, voters will keep blaming EVERYONE else possible.
Some one needs to shine the light on the BIGGEST group responsible: the voters.

Carolina wrote: Term limits for congress would go a long way to fixing congress’s problems.
I’m OK with term limits. However, the voters can implement term limits ANY time they want.

And perhaps the enough voters will, when enough voters are jobless, homeless, and hungry?

Carolina wrote: I think we should also get to vote on whether congress gets a raise or not. The people I work for decide if I get a raise-I don’t decide this. There is much in our system that needs to be changed but many people sit at home on their butts watching TV, playing video games, or looking for love on the internet. Most Americans express displeasure constantly with congress/govt but do nothing to actively make change.
Me too. Yet Congress has given itself a raise 9 times between 1997 and 2007. Cha-Ching!
Jack wrote: You should get a new stock advisor. Nobody should buy on any paricular day. If you bought stocks every two week from the day Bush was sworn in until today, you made good money. To avoid loses, you would have to have sold the year BEFORE Bush took office. My small cap fund lost 15.77% in 2000. The downturn started under Clinton, so it is a little unfair to start the clock before Bush had a chance to do anything at all.
The stock market is a gamble. It’s gambling. It is also playing with money to make money. It is a disease. Bubbles come and go because incessant inflation (since year 1956) has everyone running around like chickens with their head cut off looking for a place to avoid the erosion of their U.S. Dollars (which are eroding fast for the last 7 years).
Jack wrote: I ask again, do you want home prices to stay so high that ordinary people cannot afford to buy? It would be better if prices could come down slower, but it is a good thing that they are coming down.
Good thing? No.

But it is a result of the bubble-after-bubble and economic instability caused by the dishonest, usurious, pyramid monetary-system, which already collapsed once before, was restarted, and will collapse again when the nation-wide debt can not grow any larger.

Nation-wide dect is now $48 Trillion (almost half of the nation’s net worth; see: mwhodges.home.att.net/nat-debt/debt-nat.htm).
But, only 2% of the U.S. population owns most of the nation’s wealth.
80% of the U.S. population owns ONLY 17% of all wealth in the U.S.
So, how is it that everyone that works, and produces, and creates, is in debt to the banks, who create money out of thin air.
How is it the nation has $48 Trillion of nation-wide debt?.
Where will the money for the INTEREST on $48 Trillion come from, much less the $48 Trillion for the PRINCIPAL (LOAN=PRINCIPAL + INTEREST).
Where will the money come from when it does not yet exist, and the U.S. Dollar is already falling like a rock (one-simple-idea.com/USD_Falling.gif)?
Where will the money come from when 2% of the U.S. population owns most of the wealth in the U.S., and 80% of Americans own only 17% of all wealth in the U.S.?
Where will the money come from, when it does NOT yet exist?

Jack wrote: Prices went up way too fast from 1997-2006. Those already established in homes benefitted mightily, but it was pricing people out of the market and pushing them too far out of town. This adjustment is healthy.
Same thing happened in the real-estate market in the late 1980’s and early 1990’s.

What do you think causes these bubbles?
It is bubble after bubble.

People flee from one thing to the other, looking for some place to evade the incessant inflation and erosion of the quickly falling U.S. Dollar.
After the early 1990s, people fled to stocks.
After the stock-market bubble burst, people fled back to real estate.
Not that stock-market bubble is bursting again, where will people flee to?
Many are going into Gold (which is now over $900 per ounse).
Some people are fleeing to other currencies, with the U.S. Dollar falling so fast against all major currencies.
What causes these bubbles?

3%-to-4% inflation may not sound like much, until you realize that 3%-to-4% inflation, year after year after year (like reverse compound interest), since year 1956 is why the Consumer Price Index looks like this:
____INFLATION_______
CPI (CPI=100 for year 1967)
650 + - - - - - - - - - - -X
600 + - - - - - - - - - - -X
550 + - - - - - - - - - - -X
500 + - - - - - - - - - - X
450 + - - - - - - - - - - X
400 + - - - - - - - - - - X
350 + - - - - - - - - - -X
300 + - - - - - - - - - X
250 + - - - - - - - - - X
200 + - - - - - - - - -X
150 + - - - - - - - - -X
100 + - - - - - - - -X
050 +XXXXXXXXXXX
000 +_______________________YEAR
_____1 1 1 1 1 1 1 1 1 1 2 2
_____8 8 8 8 8 9 9 9 9 9 0 0
_____0 2 4 6 8 0 2 4 6 8 0 2
_____0 0 0 0 0 0 0 0 0 0 0 0

Jack wrote: BTW - I “lost” a pile of money on my house since it is worth maybe 15% less than it was in 2006. How does that affect me? Not at all. The house is still the same. The same goes for everybody who was not overextended in the first place and counting on increasing values to bail them out.
“Not al all”?

How cavalier?
Sure it affects the home owner.
It is not totally benign.
Especially when unemployment (the next shoe to drop) starts rising, and people need to sell their home because they can’t afford the monthy mortgage payment.
Anyone with a mortgage takes that risk.
Unless they have the money or assets to keep making the mortgage, they will lose their home.

Posted by: d.a.n at February 25, 2008 5:02 PM
Comment #246413

Phx8:

As for stocks, the only fair way to measure is begin from the date a politician takes office. At some point- perhaps months, perhaps years- the influence of the previous administration’s policies can no longer be included.

That woudn’t be just a bit self serving would it?

Posted by: Craig Holmes at February 25, 2008 5:22 PM
Comment #246412

In addition to that, most Americans incomes have been falling since year 1967, when you consider:

  • (01) there are now more workers per household making the same (or less) income as in 1967 (adjusted for inflation); Year 1967: $40K ; Year 2005: $43K

  • (02) there is more National Debt (not $9.3 Trillion)

  • (03) and taxes are more REGRESSIVE to boot, which is how Warren Buffet only paid 17.7% income tax on $46 million, while his secretary paid 30.0% income tax on $60K.

  • (04) there is more illegal immigration, displacing millions of jobs, depressing wages, and shifting an estimated $70 Billion to $338 Billion annually to middle and lower income persons (not to mention the thousands of Americans per year that are victims of crimes by illegal aliens, fueled and encouraged in part by anonymity and being repeatedly arrested and released)

  • (05) incessant inflation hurts the middle and lower income groups more, since they can protect and convert as easily into property, gold, stocks, land, oil, commodities, etc.

  • more H-1B visas, used to import skilled labor and depress wages further. Check out this law firm that teaches corporations how to avoid hiring Americans. The richest person in the U.S. (Bill Gates) wants the government to increase the limits on H-1B Visas so that he can import more cheap labor.

  • (06) unnecessary war, based on exaggerations and lies (i.e. no WMD, and blunder after blunder)

  • (07) crime rates are rising again, and why shouldn’t they, when the government flagrantly ignores the laws?
… just to name a few of the many abuses that did not all come about by mere coincidence.

But, like Carolina wrote …

Carolina wrote: I think we get what we deserve. If Americans aren’t going to put any effort into really learning about a candidate then we can’t expect anything different than what we already have.
Ignorance is not an excuse.

It is merely an invitation for more abuse. And the bought-and-paid-for incumbent politicians in Do-Nothing Congress are all too happy to perpetuate those abuses, while giving themselves a raise for it (such as their 9 raises in the past 10 years between 1997 and 2007).

Posted by: d.a.n at February 25, 2008 5:22 PM
Comment #246414

If your a working stiff (jack) and your income has stagnated for the last 8 yrs and your bills keep getting higher and you own a house the temptation to refinance is difficult to resist especially when you look around and your friends have done it and are taking vacations and enjoying a reasonably decent life which you can’t unless you refinance two or three times until you are absolutely dependent on refinancing to continue your life style so you’re trapped. you can blame jack but the system really left him with very little choice but to get sucked in and shafted in the end.no pun intended.

Posted by: albert at February 25, 2008 5:29 PM
Comment #246415

Phx8:

If you bought stocks when Bush took office, your portfolio has not kept pace with inflation. In real terms, after seven years, you are losing money.

Since the wealthy are by and far the largest holder of stocks in America, doesn’t this refute the democratic idea that Bush’s policies have only helped the rich?

Posted by: Craig Holmes at February 25, 2008 5:30 PM
Comment #246416

Craig,
It is not self-serving at all. Research the record of any presidential administration. When it comes to the stock market, the numbers are based upon first and last day of office. Period. It’s the only sensible way to approach it. Self-serving would be cherry picking the numbers to make them look as good- or bad- as possible, such as only counting days the market went up, or only days it went down, or starting the count from the lowest possible day, or the highest one, etc.

If a person started a new job and did poorly, they woudl want to discount a poor performance by insisting the previous person set unrealistic expectations of excellence that had nothing to do with reality, then call for the start of the evaluation baseline to be set at the absolute nadir of poor performance. ‘See, things are nearly as terrible as they used to be!’

Posted by: phx8 at February 25, 2008 5:32 PM
Comment #246418

Craig,
Remember the changes in taxation for capital gains and dividends?

Posted by: phx8 at February 25, 2008 5:48 PM
Comment #246423

The stock market (only a little better than gambling in Vegas) is not the best way to measure the health of the economy.
The stock market is also very vulnerable to manipulation.
The stock market also exemplifies the way America spends way too much time playing with money to make money, instead of creating value.
Many people have also lost a lot of money in the stock market.
There is incessant investment fraud, and it was rampant in the late 1990s.
Before that, there was the Savings and Loan scandal.
Bubble after bubble.
What causes those bubbles?
Who benefits from these bubbles?
Who benefits from inflation (and the subsequent foreclosures and property confiscations; converting money printed out of thin air into real property and assets)?
Who gets to print money (also known these days as: liquidity) when needed?

Hmmmmmm … do you ever get the feeling that the banks and some wealthy (that abuse wealth to use and exploit others) are crappin’ all over everyone else?
If you said yes, you are correct.
These 10+ Abuses did not all come about by mere coincidence.

Want another example of some wealthy that abuse vast weatlth to control and influence government and the majority of bought-and-paid-for incumbnet politicians in Do-Nothing Congress?

99.85% of all 200 million eligible voters in American are V_A_S_T_L_Y out-spent by a very tiny 0.15% of all 200 million eligible voters that make 83% of all federal capaign donations (of $200 or more).

But voters are culpable too, since (90% of the time) the voters simply elect the candidate that spends the most money, and repeatedly reward incumbent politicians with 93%-to-99% re-election rates, while perpetuating those 10+ abuses that cheat most Americans (one-simple-idea.com/DisparityTrend.htm).

When some say it is warfare on the middle class, they are not exaggerating.
Not when it is finally understood that those many abuses did not all come about by mere coincidence.

Craig Holmes wrote: Since the wealthy are by and far the largest holder of stocks in America, doesn’t this refute the democratic idea that Bush’s policies have only helped the rich?
Ha!

Funny. As if stocks were the only place to invest to protect money from the incessant erosion by inflation.
As you just stated, the “wealthy are by and far the largest holder of stocks in America”.
The stock market is also very vulnerable to manipulation, and the little investors are often the last to know.

Again, the stock market is not the best way to measure the health of the economy.

As for the wealth of the wealthy, in year 1980, 1% of the U.S. population owned 20% of all wealth in the U.S.
Now, 1% of the U.S. population (305 million) owns 40% of all wealth in the U.S.
80% of the U.S. population only owns 17% of all wealth in the U.S.
The disparity gap has never been worse since the Great Depression.
This gap is growing world-wide.
Why?
Because most nations around the world also bought into the doomed pyramid-scheme monetary system, which grows DEBT larger and larger.
Nation wide debt ($48 Trillion) has never been larger.
Not only in magnitude, but as a percentage of GDP.
Total current Federal debt ($22 Trillion) has never been larger since the Great Depression.
Not only in magnitude, but as a percentage of GDP.
Total nation-wide personal debt ($20 Trillion) has never been worse since the Great Depression.
Not only in magnitude, but as a percentage of GDP.

Since year 2006 (money.cnn.com/2006/03/22/real_estate/homeownership_study/index.htm) home ownership has fallen for middle-income and lower-income people.
Currently, home ownership is in a record plunge, and the 4th quarter of 2007 saw the biggest one-year drop (1.1%) since tracking began in year 1965, as current mortgage problems and rising foreclosures take their toll.

Yet, despite all this, some will tell you rosy things like

Craig Holmes wrote FEB-2008:
America as a whole has never been this rich, and it’s getting richer all the time. It’s a great time to be an American

Hhmmmm … well, they may be true indeed, if you are one of the 1 in 10 people in the U.S. that own 70% of all wealth in the nation. Cha-Ching!

Not if you are in the poorest 80% of the U.S. population that owns only 17% of all wealth in the nation.

Posted by: d.a.n at February 25, 2008 6:18 PM
Comment #246431

Jack, if you are still in Iraq, how did the Turkish incursion into Kurdistan play over there?

People have always built houses on spec for as long as I can remember, but they used to be affordable houses that most people could buy. In the 1980s people started building McMansions on spec, sometimes living in them with very little furniture until they could sell them. Now there are McMansions all over suburbia, even in places where property values are relatively low.

Carolina, in the internet world, we have so much cut and paste journalism that it is difficult to find original source material. People frequently use websites as sources, which are compilations from other sources that have been edited according to the bias of the editor. The BBC and CNN are good sources. I use Yahoo news a lot, simply because it comes up as my homepage, but I have found some bias there as well.

Posted by: ohrealy at February 25, 2008 7:54 PM
Comment #246435

phx8:

Remember the changes in taxation for capital gains and dividends?

Yes, they helped create a temporary surplus in the budget.

Changing subjects back to measuring presidents, I think it is better to use real GDP as an accurate measure.

It’s really a mixed bag of economic data that favors Clinton. There is no doubt that Clinton was by far the best president economically. Well, teamed up with a Republican congress. His fiscal conservativism, along with NAFTA and welfare reform were great for the eocnomy.

Moving a D to an R was really bad in that it removed restraint. I don’t think you will get many conservatives or moderates to disagree.

I think Hillary would make a much better president that Obama fiscally. My problem with Hillary is really not her but Bill. I don’t think it’s wise to have two presidents in the whitehouse. especially one like Bill. He was the best economically, but I still can’t stand his non stop need for self gratification.

I think McCain right now would be the best economically simply because we have a Democratic congress.

America as a whole has never been wealthier. If you look at Household networth it has been climbing very well. A lot of this is due to Globalization. Foreign earnings from large corporations are huge. Corporate profits have seldom been higher as a percentage of GDP.

I think it is squarely a great issue, to use some of this wealth to address the needs of those diseffected by globalization. It is a great time to be an american. What some negative people do is look at the wealth distribution but don’t look at it as a sourse of revenue.

If I could be permitted to swing both ways for a minute, (here comes my conservative side), my preference would be to have benefit cuts for the affluent and transfer those benefits to the poor.
For instance, why are we subsidizing medicare for the affluent at the same time we have people without heatlh insurance at all? If someone is retired and earning over $100,000/year, they should be able to pay their own medicare without subsidy. The left would rather raise taxes. I don’t rule that out, but first I would rather see benefit cuts.

Second is education. We need to help people retool.

Posted by: Craig Holmes at February 25, 2008 8:52 PM
Comment #246437

phx8:

You know this is a great time to be alive and be an American.

I would like your opinion of something. I like you because you are not locked into ideology, and it’s going to take both wings to fly this baby.

Anyway, here is what I’m thinking. A lot of problems are how we frame them. You can look at them all negative or all positive. It looks to me like one of the real reasons for the negative is that we are not taking advantage of the positives properly. Let me explain.

One of the huge big issues is that we are living longer. What that does on the young end is makes kids grow up slower. They don’t want to take responsibility as soon as we did. As evidence, I would offer, that weddings and babies are happening later than they used to.

The flip side of the issue is very long retirements. (very long relative to our parents and grandparents and around the world).

In addition most of our social programs were designed for entirely different demographics.

If you accept the above, then really what we are talking about, or should be talking about is redesigning our resourses to fit our new life span.

What does this mean? It means retiring later, and retraining more. It means rewriting our social contract.

Back to switch hitting. I we should be able to stay within 20% of GDP for federal expenses. And again, I would be open to tax increases AFTER the affluent are not subsidized anymore.

There are at least three huge sourses of new wealth that we can use. One is longevity. There is no reason many people cannot wait until 70 to get full benefits. Second, is rise in assets, (wealth differencial). One of the main reasons for the wealth inequality is rising corporate profits and lower interest rates that have increased stock prices over the last many years, since 1980. Finally, High corporate profits.

So Craig’s idea would be to rewight the whole thing. I would rewrite education to target people in their late 20’s. And I would lower subsidies on the affluent to pay for health care of the working poor.

It’s a wonderful time to be an American because we have the resourses to do these things, and we can leverage these assets to produce more.

Posted by: Craig Holmes at February 25, 2008 9:24 PM
Comment #246439
It’s a wonderful time to be an American because we have the resourses to do these things, and we can leverage these assets to produce more.
Craig, take off the rose colored glasses, and answer a few questions for us.

Never mind these abuses.
Never mind these economic factors.
Never mind these pressing problems being ignored year after year.

Just answer us this
With $48 Trillion in nation-wide debt (mwhodges.home.att.net/nat-debt/debt-nat.htm), and the U.S. borrowing #3 Billion per day, WHERE will the money to pay the INTEREST on that debt come from? Much less the money to pay down some of the $48 Trillion of PRINCIPAL (LOAN = PRINCIPAL + INTEREST).

WHERE will the money come from, when 80% of the U.S. population only owns 17% of all wealth in the nation, a mere 2% own half of all wealth in the U.S., and the $48 Trillion of nation-wide debt is almost half of all wealth in the nation?

Print more money? (like what they have already been doing?).
Have you seen the U.S. Dollar lately?
( one-simple-idea.com/USD_Falling.gif ).
The U.S. Dollar has been falling against ALL major currencies for 7 years

  • $1 U.S. Dollar fell from 8.28 Chinese Yuan to 7.43 Yuan between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 0.98 EURO to 0.6825 EURO between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.80 British Pound (GBP) to 1.07 GBP between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.57 Canadian (CAD) to 0.926 CAD between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.78 Austrailian (AUD) to 1.077 AUD between Jan-2003 and Oct-2007

  • $1 U.S. Dollar fell from 1.46 Swiss Franc (CHF) to 1.13 CHF between Jan-2003 and Nov-2007

  • $1 U.S. Dollar fell from 3.51 Argentine Peso (ARS) to 3.13 ARS between Jan-2003 and Nov-2007

  • $1 U.S. Dollar fell from 31.8 Russian Roubles (RUB) to 24.59 RUB between Jan-2003 and Nov-2007

Yet, you write …

Craig Holmes wrote FEB-2008:
America as a whole has never been this rich, and it’s getting richer all the time. It’s a great time to be an American.
… and …
It’s a wonderful time to be an American because we have the resourses to do these things, and we can leverage these assets to produce more.

Maybe in another dimension.

Posted by: d.a.n at February 25, 2008 9:57 PM
Comment #246440

Craig,
Rewriting the social contract cannot rewrite the biological contract. In biological terms, we are developing differently. For example, puberty is occurring at much earlier ages, partly as a result of nutrition, perhaps also as a result of hormones introduced into our food. Young adults are may delay marriage as a matter of social reflex, but the biological clock still ticks away. So, I am not sure delaying higher education is an option. I am not sure government can engineer society to that degree. However, I would favor extending free public education beyond secondary education, and use state universities to provide free public education through a B.A./B.S

No doubt, there is no better investment than education/R & D.

And we’re living longer, but that doesn’t necessarily mean years of productivity are being extended along with the longer lifespan. A lot of preventable causes of death take their tolls by the 70’s, such as poor diet, lack of exercise, smoking, and so on. But what that means is that lifespans could be extened to the 90’s. And there is still a biological wall at @ 120. But for the most part, what we’re doing is prolonging old age and postponing death, not extending middle age.

We could rewrite the social contract to delay the expectation of retirement to the age of 70, and structure social security insurance to reflect that social engineering.

But I’m 51, and I get tired just thinking about working another 20 years! I’ve been re-writing a science fiction novel every night, and I should have the final draft done by August. Whew! But meanwhile I’ll keep my day job.

Posted by: phx8 at February 25, 2008 10:14 PM
Comment #246441

phx8

On higher education, I mean providing more on top of what is already there. The average age of students in community colleges is about 30. It is at that time when young adults start of “figure it out”. The problem is that many have families. We need to provide more assistance to these more mature young adults so they can go back and get additional training.

Look at this article:

http://www.msnbc.msn.com/id/19173780/

It’s already happening. Our generation is predicted to start a new life stage between our careers and full retirement. Some are calling this Encore. Basically for you it would mean finishing your career and working as a writer for 5 or 6 years before completely retiring. that is what is projected to happen.

For retirement, it simply means maximum benefits for SS. You want to retire early, go ahead on it. 70% of boomers want to continue to work past normal retirement age anyway.

And we’re living longer, but that doesn’t necessarily mean years of productivity are being extended along with the longer lifespan

Yes it does. Disability among the elderly is droppoing fast.

I think the future will be filled with part time workers in their 70’s.

Look at this article:

http://www.msnbc.msn.com/id/19173780/

It’s already happening. Our generation is predicted to start a new life stage between our careers and full retirement. Some are calling this Encore. Basically for you it would mean finishing your career and working as a writer for 5 or 6 years before completely retiring. that is what is projected to happen.

In the end we have plenty of resourses to take care of people’s needs, just not wants. I don’t think we need to subsidize the wealthy’s health care. I think we can create incentives to help people work a little longer. We still end up with as many years of retirement as our papents and more than oour grandparents.

If we simply provided incentives to increase retirment age by a few years it makes a huge difference.

Posted by: Craig Holmes at February 25, 2008 10:32 PM
Comment #246448
If we simply provided incentives to increase retirment age by a few years it makes a huge difference.
Some of the most diligent of all 200 million voters (i.e. senior citizens) are not likely to like that.

But that is what will probably have to happen, since Congress borrowed and spent $12.8 Trillion from Social Security (leaving it pay-as-you-go) with a 77 million baby boomer bubble approaching.

And Do-Nothing Congress won’t hesitate to raise taxes and cut benefits, and then reward themselves for all of it by giving themselves another raise, like the 9 raises between 1997 and 2007.

  • Posted by: d.a.n at February 26, 2008 12:12 AM
    Comment #246449

    Craig, simply raising the eligibility age for seniors ain’t nearly enough to sovle this nation’s economic problems, which are not getting better as long as Congress continues to perpetuate these abuses.

    And nobody can say where the money will come from to pay the INTEREST on the current $48 Trillion of nation-wide debt (mwhodges.home.att.net/nat-debt/debt-nat.htm)?

    Seems like that little detail would be somewhat germane to the issue of getting through the next recession (or worse)?

    If we can’t keep up with the INTEREST, much less reduce the $48 Trillion of PRINCIPAL debt (i.e. LOAN = PRINCIPAL + INTEREST), there’s going to be some significant economic problems in the coming years.

    Odd how this is getting very little attention (except by a very few people that know and think it may already be too late; such as U.S. Comptroller David Walker).

    Posted by: d.a.n at February 26, 2008 12:41 AM
    Comment #246451

    David Walker 1

    Falling U.S. Dollar

    Economic Concerns - CNN Reports

    More …

  • www.youtube.com/watch?v=25_APRkrXeY&feature=related

  • www.youtube.com/watch?v=qbzGlVETXlg&feature=related

  • www.youtube.com/watch?v=yY6u-sXKGSo&feature=related

  • www.youtube.com/watch?v=l_0pqHzK324&feature=related

  • www.youtube.com/watch?v=4n3g5lUgkWk&feature=related

  • www.youtube.com/watch?v=bU6I53g_X1s&feature=related

  • www.youtube.com/watch?v=sZ05ng1qqyk&feature=related

  • www.youtube.com/watch?v=Iq11ZBAzVJ4&feature=related

  • video.google.com/videoplay?docid=-9050474362583451279

  • www.youtube.com/watch?v=DXr_Ga_n0pY&feature=related

  • www.youtube.com/watch?v=GcvMPo38HQo&feature=related

  • www.youtube.com/watch?v=KjZBOCAgR64&feature=related

  • Posted by: d.a.n at February 26, 2008 1:41 AM
    Comment #246466
    Rowan Wolf wrote: Indeed! Here we have a situation where the U.S. government deregulated banking, setting up a Ponzi scheme for both the credit and mortgage markets, which accelerated a housing bubble which has burst at the same time as the risky loans (not risky borrowers) hit their margins. Then, those engaged in the fleecing of borrowers (particularly borrowers faced by systemic predatory and discriminatory lending practices) are “bailed out” with our tax dollars, so that they can continue to fleece the people.

    Indeed! If the economy is an important issue (links to videos above), people may want to consider the question:

      WHERE will the INTEREST come from to pay the current nation-wide debt of $48 Trillion, much less the $48 Trillion of PRINCIPAL debt?
    Here’s an experiment to demonstrate the problem:
      Play a game of Monopoly in which one player (the bank) can create all the money they want. What happens? Before long, the bank owns everything, and everyone else is broke or deep in debt.

    How can the economy be discussed without considering the monetary sytsem and its wide-reaching effects

    • Consider the incessant non-stop inflation since 1956.

    • Consider the falling U.S. Dollar (against all major international currencies; one-simple-idea.com/USD_Falling.gif).

    • Consider the nation-wide personal debt ($20 Trillion).

    • Consider the National Debt ($9.3 Trillion).

    • Consider the $12.8 Trillion borrowed from Social Security, leaving it pay-as-you-go, with a 77 million baby boomer bubble approaching (13,175 new recipients per day).

    • Consider the state and local government debt ($6 Trillion).

    • Consider the shifting wealth distribution (year 1980: wealthiest 1% owned 20% of all wealth; year 2008: wealthiest 1% owns 40% of all wealth; never worse since the Great Depression).

    • Consider the falling incomes since year 1967 (especially when considering more workers per household, more federal debt with more regressive taxes, more illegal immigration, more H-1B visas depressing wages and displacing jobs, etc.)

    • Consider the bubble after bubble (stocks, real-estate, gold, bonds, commodities, stocks, real-estate, … over and over).

    • Since year 2006 (money.cnn.com/2006/03/22/real_estate/homeownership_study/index.htm) home ownership has fallen for low-income and middle-income people.

    • Nome ownership is now in a record plunge (money.cnn.com/2008/01/29/news/economy/home_ownership_vacancies/index.htm?postversion=2008012913), and the 4th quarter of 2007 saw the biggest one-year drop (1.1%) since tracking began in year 1965, as current mortgage problems and rising foreclosures take their toll.

    • How can everyone that produces value, invents, creates, and works be in debt to the banks that create money out of thin air (up to 90% of each new loan is money created out of thin air)?

    Posted by: d.a.n at February 26, 2008 11:21 AM
    Comment #246472

    There’s only one issue that is important in this election and that’s: HOPE!** I’m for Obama b/c he gives me HOPE.***

    Posted by: rahdigly at February 26, 2008 1:29 PM
    Comment #246479
    There’s only one issue that is important in this election and that’s: HOPE!** I’m for Obama b/c he gives me HOPE.***
    Hope is good. That comment is very apropos for this thread. : )

    Hope is a start.
    But will hope alone be enough?

    How about $48 Trillion of debt (regardless of who the next president is)?
    WHERE will the money come from to pay the INTEREST on that $48 Trillion, much less the money to reduce the PRINCIPAL $48 Trillion of debt?

    Like a 30 year mortgage, the INTEREST alone could eventually become MANY times larger than the PRINCIPAL.

    * * * crickets chirping * * *

    What does the silence mean?

    The next president (whoever it is) is going to have some serious economic issues to deal with. It is unlikely, but it will be interesting to see if the monetary system is addressed in anyway, since it has such a far-reaching impact on the economy, and creates a myriad of side-effects and some of these abuses.

    Posted by: d.a.n at February 26, 2008 2:24 PM
    Comment #246482

    rahdigly

    There’s only one issue that is important in this election and that’s: HOPE!** I’m for Obama b/c he gives me HOPE.***

    Hope in what?

    Posted by: Craig Holmes at February 26, 2008 2:42 PM
    Comment #246487

    Hope*** is definced as the feeling that what is wanted can be had or that events will turn out for the best. Pretty non-specific, but I think that other poster was being sarcastic. Maybe they are hoping for more nuclear power.

    Posted by: ohrealy at February 26, 2008 3:19 PM
    Comment #246490

    ohrealy:

    I am 52 and have never seen anything like this before. The same left that if fearful of born again Christians are running after this guy with no resume’. It is just wild. They sure have faith in something.

    It is sure obvious why someone like Hitler could come to power.

    Somewhere down the road someone needs to say that this “Emperor” is naked!!

    Posted by: Craig Holmes at February 26, 2008 4:12 PM
    Comment #246493

    Unfortunately for Democrats, Obama is going to slide through unvetted. People are also manipulating the media, like with that Obama picture, to make sure that we do not talk about anything substantive. If it walks talks and quacks like a Drudge, etc.

    The only question I have is, when are they going to start the real attacks on Obama? Are they going to try to do it when Obama has enough of a delegate lead to make the convention into a disaster, or will they wait until the day after he’s nominated?

    SNL started off pretty well this week after the writers stirke ended. The Obamites have flooded youtube with copies of the same video under different names, all attacking Tina Fey and Hillary.

    Maybe his supporters have decided to swiftboat McCain. They are certainly on the attack. Angry in Victory, is how I would describe the Obamites.

    Posted by: ohrealy at February 26, 2008 4:35 PM
    Comment #246496

    I wonder if Obama will implode like Dean?

    This is all new ground for our country.

    I think McCain helps a little bit. I have to think there are those in the media who do not fear McCain. That would give them the freedom to “vet” Obama.

    Posted by: Craig Holmes at February 26, 2008 5:43 PM
    Comment #246508
    Hope in what?
    Hope is a start.But will hope alone be enough?

    Craig & Dan, I was told a while back on this blog, that when there are asteriks, after a sentence, that it means someone is being sarcastic or facetious. Notice I had two and three asterisks after the Hope comment & supporting Obama.

    IMO, all Obama is about is Hope. And….I’m all for Hope in a candidate.******* Capiche?!!!

    Posted by: rahdigly at February 26, 2008 9:49 PM
    Comment #246511

    rahdigly, I was not aware of that rule about asterisks.

    So you’re not an Obama fan?

    I’m not a big fan of any of the current presidential candidates (all have lousy and/or nebulous voting records/positions on illegal immigration, border security, enforcement of existing laws to prosecute illegal employers, fair trade policies, monetary policies, fair taxation, upholding the Constitution, fiscal responsibility, and addressing several other abuses of the last 30 years: one-simple-idea.com/DisparityTrend.htm), but if I had to list the candidates from least unacceptable - to - most unacceptable, this would be it for me (as of 26-FEB-2008):

    • (1) Ralph Nader (least unacceptable)

    • (2) Barack Obama

    • (3) John McCain

    • (4) Hillary Clinton (most unacceptable)
    That’s just my opinion (ranking; subject to change as more information becomes available).

    I may not vote for any presidential candidate, but I will most certainly be voting on 4-NOV-2008 (to vote against Senator John Cornyn, Rep. Michael Burgess, and some other incumbents that have have been doing little (if anything) to stop these abuses.

    So, rahdigly … do you know where the money will come from to pay the INTEREST on $48 Trillion of nation-wide debt, much less the money to reduce the $48 Trillion of PRINCIPAL debt?

    Seems likely, whoever the next president is, the president will inherit a H_U_G_E economic mess, and probably get saddled with the same Congress that also did little (if anything) to stop these abuses.

    Posted by: d.a.n at February 26, 2008 10:21 PM
    Comment #246517

    I was hoping to put this one in when Jack gets back from Iraq, but how about repudiation of the debt? Partial repudiation? Rescheduling or deferring payment on the debt? Bankruptcy or Reorganization? Government bonds issued with pictures of GWBush with his finger up his nose? It could be like a hologram or a gif. It’s his debt, let the haves and have mores pay it.

    Posted by: ohrealy at February 26, 2008 11:06 PM
    Comment #246560

    Typical liberal economic ignorance.

    First, you point out how women and minorities are hurt more. I thought we are all equal, why break people up into groups. Should everyone’s suffering count the same?

    Secondly, If these groups couldn’t get loans for their houses you would be the first to complain.

    Lets not forget whose fault this is. The deadbeats who didn’t pay their loans.

    http://www.jcardsworld.blogspot.com/

    http://www.jcardsworld.blogspot.com/

    Posted by: Jcard at February 27, 2008 1:03 PM
    Comment #246566

    Jcard, Yes, many people were foolish to get too deep in debt. That’s not my concern either.

    But what about these abuses?

    How about $48 Trillion of nation-wide debt (regardless of who the next president is)?
    WHERE will the money come from to pay the INTEREST on that $48 Trillion, much less the money to reduce the PRINCIPAL $48 Trillion of debt?

    Have you seen the U.S. Dollar lately?

    Posted by: d.a.n at February 27, 2008 1:24 PM
    Comment #246574
    do you know where the money will come from to pay the INTEREST on $48 Trillion of nation-wide debt, much less the money to reduce the $48 Trillion of PRINCIPAL debt?

    Yeah, it’ll come from us Americans in the form of TAXES!

    I agree with your assessment of the candidates; it’s a “bad” bunch to choose from. I may just write in vote and then, for the rest on the ballot, vote for the most conservative sons-of-beeatches this planet has ever seen to offset the congress and Presidency. There’s a storm on the horizon in 2009…

    Posted by: rahdigly at February 27, 2008 3:19 PM
    Comment #246593
    rahdigly wrote: Yeah, it’ll come from us Americans in the form of TAXES!
    The question is, can taxes be raised enough to pay the debt?

    The break-down is …

    • $9.3 Trillion National Debt

    • $12.8 Trillion from Social Security (leaving it pay-as-you-go) with a 77 million baby boomer bubble approaching.

    • $450 Billion PBGC pension debt.

    • $6 Billion state and local government debt

    • $20 Trillion personal nation-wide debt

    • ————————————————————

    • TOTAL = $48 Trillion DEBT

    Total GDP is $13.8 Trillion.
    The INTEREST on the $9.3 Trillion National Debt is over $1.178 Billion per day ($430 Billion per year).
    The U.S. is borrowing $3 Billion per day ($1.1 Trillion per year).
    At only 4% INTEREST (on average), the daily INTEREST on $48 Trillion DEBT is: $5.263 Billion per day ($1.92 Trillion per year).
    At only 4% INTEREST (on average), to prevent the $48 Trillion of DEBT from growing larger, the U.S. (as a whole) would have to make a daily PAYMENT larger than that $5.263 Billion per day ($1.92 Trillion per year).
    Yet, the U.S. is borrowing $3 Billion per day ($1.1 Trillion per year).

    Now consider the impact all of this will have on Social Security (already $12.8 Trillion borrowed and spent from it, leaving it pay-as-you-go, with a 77 million baby boomer bubble approaching).

    But, consider the $9.3 Trillion National Debt.
    And the total annual tax revenues of $2.6 Trillion.
    However, $430 Billion of that $2.6 Trillion in total federal revenues goes to INTEREST on the $9.3 Trillion National Debt.
    However, $620 Billion of that $2.17 Trillion in total federal revenues goes to Social Security.
    And $650 Billion of the remaining $1.55 Trillion goes to Health and Human Services.
    And $580 Billion of the remaining $0.93 Trillion goes to National Defense.
    And $100 Billion of the remaining $0.35 Trillion goes to Dept. of Agriculture.
    And $200 Billion of the reamining $0.25 Trillion goes to run the Treasury Dept.
    And $600 Billion of the remaining $0.05 Trillion goes to other departments, leaving a -$0.55 Trillion deficit.
    Therefore, the deficit is 21% of the total $2.6 Trillion in total federal tax revenues.

    So, can the federal government raise taxes enough to cover the current annual $550 Billion deficit, much less raise enough to keep the national debt from growing larger?
    Especially with regressive taxation?
    Especially when there is $20 Trillion of personal nation-wide debt?
    Especially when 80% of all Americans only own 17% of all wealth in the nation, and 2% of the wealthiest Americans own most of the wealth in the nation?
    And that trend is worsening (1% of the wealthiest owned 20% of all wealth in 1980, now 1% owns 40% of all wealth in the U.S.).

    rahdigly wrote: Yeah, it’ll come from us Americans in the form of TAXES!
    So, it doesn’t look like that will be even remotely enough.

    Unfortunately, what is more likely to happen is more money created out of thin air, and more INFLATION:
    ____INFLATION_______
    CPI (CPI=100 for year 1967)
    650 + - - - - - - - - - - -X
    600 + - - - - - - - - - - -X
    550 + - - - - - - - - - - -X
    500 + - - - - - - - - - - X
    450 + - - - - - - - - - - X
    400 + - - - - - - - - - - X
    350 + - - - - - - - - - -X
    300 + - - - - - - - - - X
    250 + - - - - - - - - - X
    200 + - - - - - - - - -X
    150 + - - - - - - - - -X
    100 + - - - - - - - -X
    050 +XXXXXXXXXXX
    000 +_______________________YEAR
    _____1 1 1 1 1 1 1 1 1 1 2 2
    _____8 8 8 8 8 9 9 9 9 9 0 0
    _____0 2 4 6 8 0 2 4 6 8 0 2
    _____0 0 0 0 0 0 0 0 0 0 0 0

    The U.S. Dollar has already been falling drastically since year 1999 against all major international currencies (including the Argentine Peso, which everyone used to make jokes about; the U.S. Dollar is worth less than the Canadian Dollar for the first time ever, and today).

    Now when personal nation-wide debt is already at $20 Trillion.
    And raising taxes does not always raise more revenues.
    Inomce have already been falling since 1967 (when including more workers per household, more regressive taxation, more federal government debt, more debt, more illegal immigration, etc.).

    Lastly, with $48 Trillion of nation-wide debt, where will the money come from to pay the INTEREST, much less the money to reduce the $48 Trillion of PRINCIPAL debt?
    Especially when that money doesn’t yet exist?
    That is, we may have already passed the point of no return?
    That is, what are the chances that government will have the discipline to avoid the painful consequences of so much debt?

    rahdigly wrote: I agree with your assessment of the candidates; it’s a “bad” bunch to choose from. I may just write in vote and …
    Me too.
    rahdigly wrote: … and then, for the rest on the ballot, vote for the most conservative sons-of-beeatches this planet has ever seen to offset the congress and Presidency.
    I haven’t seen many real conservatives in many years.

    Not 10, 20, 50, 100, 200, much less at least 268 (half of 535) in Congress that are fiscally conservative, responsible, and accountable.

    rahdigly wrote: There’s a storm on the horizon in 2009…
    Yes there is. The melt-down may still be years away, or decades away, but all pyramid-schemes eventually collapse.
  • Yet, too many voters still complain about incumbent politicians out of one side of their mouth (and give them dismal approval ratings of 11%-to-18%), but then reward repeatedly incumbent politicians with 93%-to-99% re-election rates.

    Maybe that will change when enough of the voters are jobless, homeless, and hungry?

    At any rate, the voters will have the government that the voters deserve.

    Posted by: d.a.n at February 27, 2008 7:19 PM
    Comment #246633

    Bernanke says the Federal Reserve “will control inflation”.

    Hmmmmm … perhaps it all depends on what you mean by control?

    Is controlling inflation such that the U.S. Dollar will be eroded, year after year?
    Is the goal such that a 1950 U.S. Dollar now worth 11 cents?

    Control inflation?
    Like this?

    So, how does one control a pyramid-scheme?
    Print more and more money to avoid its collapse?

    There’s just one little problem with that model.
    Eventually, the debt can not grow any larger, because most people are already broke and deep in debt.

    When the capacity for more debt is reached, the pyramid scheme will collapse.

    The U.S. already has $48 Trillion of current debt (that’s not future debt; that’s current debt).
    Future debt includes the future INTEREST on that current debt.

    Yet, Bernanke says the Federal Reserve “will control inflation”?

    Not likely, because inflation is the inevitable side-effect of the pryamid-scheme monetary system. And the ONLY way to avoid collapse is to create more money out of thin air, eroding the U.S. Dollar more. It’s a vicious circle. And eventually, as with all pyramid schemes, when the nation can not take on more debt, and it takes a wheel-barrow full of U.S. Currency to buy a loaf of bread, that pyramid-scheme will collapse. It is a mathematical certainty. So, why does Bernanke look so nervous these days? Why the concern if there’s nothing to be concerned about? If we are invincible and the Federal Reserve’s pyramid-scheme monetary system is so wonderful, why are these people (local and foreign) saying the following … (including the U.S. Comptroller, David Walker)?

    Posted by: d.a.n at February 28, 2008 11:11 AM
    Comment #246655

    __TOTAL U.S. Debt and National Income__(2006 Dollars)
    T=Trillion
    $50.0T + - - - - - - - - - - - - - -Debt=$48 T
    $47.5T + - - - - - - - - - - - - - D
    $45.0T + - - - - - - - - - - - - - D
    $42.5T + - - - - - - - - - - - - -D
    $40.0T + - - - - - - - - - - - - -D
    $37.5T + - - - - - - - - - - - - D
    $35.0T + - - - - - - - - - - - -D
    $32.5T + - - - - - - - - - - - D
    $30.0T + - - - - - - - - - - -D
    $27.5T + - - - - - - - - - - D
    $25.0T + - - - - - - - - - -D
    $22.5T + - - - - - - - - - D
    $20.0T + - - - - - - - - -D
    $17.5T + - - - - - - - - D
    $15.0T + - - - - - - - -D
    $12.5T + - - - - - - -D
    $10.5T + - - - - D - - - - - - - - -Income=$10T
    $07.5T + - - D - - - - - - I
    $05.0T +D- - - - I
    $02.5T +I
    $00.0T +__________________________YEAR
    _______1 1 1 1 1 1 1 1 1 1 1 2 22
    _______9 9 9 9 9 9 9 9 9 9 9 0 00
    _______5 6 6 6 7 7 8 8 8 9 9 0 00
    _______7 1 5 9 3 7 1 5 9 3 7 1 56

    The Debt-to-Income ratio in year 1957 was 200% (($5T/$2.5T)=2.0 x 100)
    The Debt-to-Income ratio in year 2006 was 480% (($48T/$10T)=4.8 x 100)
    That is, in 1957, total debt was 2.0 times national income.
    Today, total debt is 4.8 times national income.

    Posted by: d.a.n at February 28, 2008 2:31 PM
    Comment #246865

    lots of links but what’s your point? In my opinion the economy is the number on issue in the election and McCain, Hillary, and Obama know it.

    I’m not sure you proved your case that the economy got lost in the nomination process.

    The entire world knows we are bout to head into recession. Why it’s absolutely a fact now that we are going into recession. It’s UNTHINKABLE that we could miss having a recession. Obama and Hillary are now running on the Bush recession. So many people KNOW we are going into recession soon it’s common knowledge.

    Hmmm, I wonder. Does that mean that most likely we wont have a recession? I’m a bit of a contrarian and get this sneaky feeling a recession so broadly advertised may never appear.

    Posted by: s at March 1, 2008 3:10 PM
    Comment #246924
    s wrote: lots of links but what’s your point? … I’m not sure you proved your case that the economy got lost in the nomination process.

    Yes, the ECONOMY is at the top of the voters’ issue list.

    But do the voters really understand it?
    It’s probably safe to say 80% have an intiution that something is wrong, but 99% of that 80% probably do not know exactly what it is.
    Of course, the root problem is greed, selfishness, complacency, apathy, irrational fear, and laziness, and from that, we have other 10+ abuses that have been chipping away at the fiscal and moral fiber of society for over 30 years.

    The prioritization of the list (below) varies a bit between Republicans and Democrats, but both see the ECONOMY as issue # 1:

    • (1) ECONOMY

    • (2) IRAQ

    • (3) ILLEGAL IMMIGRATION

    • (4) HEALTH CARE

    • (5) HOMELAND SECURITY

    • (6) EDUCATION

    • (7) ENVIRONMENT
    ? The question is, with $48 Trillion of Nation-wide debt, where will the money come from to pay the INTEREST on the debt, much less the money to reduce the PRINCIPAL $48 Trillion of nation-wide debt?

    That’s (on average) $157,377 per person.

    However, 80% of all 305 Million Americans only own a mere 17% of all wealth (about $110 Trillion) in the U.S., and nothing has been done to stop these 10+ abuses which have been getting worse.

    s wrote: Hmmm, I wonder. Does that mean that most likely we wont have a recession? I’m a bit of a contrarian and get this sneaky feeling a recession so broadly advertised may never appear.
    It depends. The Federal Reserve may create some more money out of thin air, to stave off a recession, but it will only make it worse later (like burning the candle at both ends), and all pyramid-schemes are mathematically doomed to collapse eventually. And a badly managed pyramid scheme will collapse much sooner.
  • Posted by: d.a.n at March 2, 2008 5:37 PM
    Comment #248338

    Hillary and Obama are joined at the hip on all issues. which is why you are hearing Character and personality attacks from both camps.


    Afraid to differ on anything substantial….they wind up with a war of character and personalty attacks.

    Quite frankly, I think HIllary’s lying. That she is not joined at the hip with Obama in supporting the far left progressive agenda…she’s just pretending to in order to take the issues away from him.

    Posted by: Stephen at March 18, 2008 12:24 AM
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