Just a few short days ago, President Obama uttered these words in his 2015 State of the Union speech:
At every step, we were told our goals were misguided or too ambitious; that we would crush jobs and explode deficits. Instead, we’ve seen the fastest economic growth in over a decade, our deficits cut by two-thirds, a stock market that has doubled, and health care inflation at its lowest rate in fifty years.
Now I won’t spend time debunking the four lies he told in that short excerpt, instead let’s look at just his claim that he’s a “deficit cutter” in this great article from over at Doug Ross’ place:
ONE CHART IS ALL IT TAKES: The Ludicrous Claims of Obama as a “Deficit-Cutter”
Put simply, any claims linking President Obama to fiscal responsibility are somewhat akin to using Michael Moore as a spokesperson for Jenny Craig.
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By the time this walking economic catastrophe has left office, the total federal debt will have doubled. All of the debts rung up in all of American history will have doubled in eight short years.
Every governmental oversight office — from the CBO to the GAO — is warning that the debt is “unsustainable”. Interest payments on the debt will double in just the next five years, from $266.7 billion currently to $578.3 billion in 2020. And the Obama administration’s forecast shows interest payments rising to $785 billion per year by 2025.
And let’s not forget Obama’s failure to even talk about the looming entitlement crisis.
The system is headed for collapse. And Obama has only added fuel to the fire.
He was instrumental in the Allied victories in WWII, but his economic policies were disastrous. A little tidbit that is all but forgotten is the fact that Roosevelt forced all Americans to turn in their gold, or else.
FDR, the man who studied Mussolini, who birthed the current intrusive state, who started the drug war in earnest, who put Japanese Americans into concentration camps, who extended the Depression years longer than it needed to be and thereby contributed to the genesis of the Second World War, who tried to pack the Supreme Court, who gave away half of Europe to the Soviets at Yalta, and who confiscated the gold – the real wealth – of the American people.
What a guy. And he still has his face on the dime.
Just imagine the uproar if Obama did such a thing. But hey, I mean he compares himself to FDR all the time, so maybe we ought to all hide our gold now, while we can…
There is a reason why my grandmother, a good New York City Irish catholic despised the man. She thought Roosevelt was a hair’s breadth short of being a dictator.
Well, way to go lefties! Now the price of eggs and milk and, well just about EVERY FREAKIN’ THING at the grocery store is going to go up in price! Not to mention the cost of a Big Mac, or Whopper or etc…
At the stroke of midnight today, 19 states increased their minimum wage. Residents of three more and the nation’s capital can expect hikes later on this year.
A year ago, the White House and Democratic lawmakers embarked on a campaign to make the minimum wage a defining issue in the 2014 elections. And although that didn’t pan out exactly as planned at the federal level, nearly half the states took action on the issue.
In his State of the Union address last January, President Obama urged members of Congress to pass bills from Sen. Tom Harkin, D-Iowa, and Rep. George Miller, D-Calif., to raise the federal minimum wage to $10.10.
“Say yes,” Obama said. “Give America a raise.”
Federal legislation was met with resistance. though. Republicans argued raising the minimum wage would cause an increase in prices for consumers and low-wage workers likely would face layoffs as companies grappled with the higher costs associated with hiked wages.
Some of those concerns were validated last month by a University of California, San Diego, study. For three years, researchers followed low-income workers residing in states that saw wage hikes and those that did not. The study found that minimum wage hikes had negative impacts on employment, income and income growth.[…]
“Minimum wage supporters have good intentions, but those good intentions cannot repeal the law of unintended consequences,” James Sherk, an expert in labor economics at The Heritage Foundation, told The Daily Signal. He added:
Minimum-wage increases reduce the total earnings of low-wage workers — the higher pay for some workers gets completely offset by the nonexistent pay of those no longer employed.
In its study, UCSD researchers found that after minimum-wage increases, the national employment-to-population ratio decreased by 0.7 percent points between December 2006 and December 2012.
In addition, the study found that minimum-wage increases hindered low-skilled workers’ ability to rise to lower-middle -lass earnings.
“Don’t Ask, Don’t Tell” may not be policy in the military any longer when it comes to a soldier’s sexual preference; but it is definitely government policy when it comes to reporting on the state of our economy or on unemployment data. When a government agency or the President spouts a glowing feel good statistic about how well the economy is doing, they prefer you don’t ask why their numbers don’t square with your reality so they won’t have to tell you the truth. For the minority of Americans who are wanting to know the truth, they generally have to got to alternative news sources to find out that the unemployment numbers are down because more and more people are dropping out of the workforce or that the majority new jobs are either part-time or low wage jobs.
The same deception is used when reporting on the GDP. We were recently treated to glowing reports that 3rd Quarter GDP was a whopping 5%. The Wall Street cheerleaders at CNBC were absolutely giddy in their reports that the economy had finally reached escape velocity. Consumers were finally spending like they hadn’t done in six years! Really? Is that what you folks on Main Street were seeing in July, August, and September? Does that reflect your reality? Of course not! So, how did our government come up with such seemingly out-of-whack spending data for the 3rd Quarter?
It turns out you were spending more money; but over three quarters instead of one quarter. What were you buying so much of that it had such a cumulative impact on the GDP? Apparently the Bureau of Economic Analysis (BEA) didn’t want to embarrass the Obama administration with the low ObamaCare purchases in the first and second quarters of the year; so they didn’t include them the GDP number for those quarters. Instead, they dumped three quarters of your ObamaCare spending into the 3rd Quarter. What they don’t want you to ask and what they don’t want to tell you is that 2/3 of the fabulous 5% GDP number is due to your shelling out for ObamaCare since the beginning of the year. You can read all about it here. But don’t tell Wall Street. They are still celebrating.
Well, that’s what I’m thinking. What are your thoughts?
The U.S. economy roared into overdrive in the third quarter as consumer and business spending fueled the biggest expansion in more than a decade.
Gross domestic product grew at a 5 percent annual rate from July through September, the biggest advance since the third quarter of 2003 and up from a previously estimated 3.9 percent, revised figures from the Commerce Department showed today in Washington. The median forecast of 75 economists surveyed by Bloomberg projected a 4.3 percent increase in GDP.
Sounds amazing, right?
It’s also too good to be true. But journalists aren’t known for their economic prowess. And they’re fully invested in “proving” Obama’s success.
So here’s the dirty little secret they aren’t telling you.
Back in June, when we were looking at the final Q1 GDP print, we discovered something very surprising: after the BEA had first reported that absent for ObamaCare, Q1 GDP would have been negative in its first Q1 GDP report, subsequent GDP prints imploded as a result of what is now believed to be the polar vortex. But the real surprise was that the ObamaCare boost was, in the final print, revised massively lower to actually reduce GDP!
In layman’s terms, they initially put ObamaCare in to make Q1 look less bad, then took it out when nobody was looking after they decided to blame their woes on the “polar vortex.”
Fast forward 6 months, and with a small uptick in actual consumer spending (probably due to those falling oil prices, for which, btw, Obama can’t claim even one iota of credit), it’s time to reinsert the ObamaCare factor to really pump up the numbers.
Here’s Tyler Durden’s handy chart showing the Q3 GDP breakdown:
As you can see, without ObamaCare the consumer spending numbers would still be abysmal.
In short, two-thirds of the “boost” to final Q3 personal consumption came from, drumroll, the same ObamaCare which initially was supposed to boost Q1 GDP until the “polar vortex” crashed the number so badly, the BEA decided to pull it completely and leave this “growth dry powder” for another quarter. That quarter was Q3.
Our economy “grew” because the government forced 9 million people to buy health insurance.
What are they going to do for an encore? Force 9 million people to buy a car from Government Motors?
Conservatism is by today’s standards closely associated with Edmund Burke’s philosophy. I think it goes beyond that, in that it is more than merely a political doctrine. It is, in my estimation, a way of life, a code of conduct that associates one’s property with one’s liberty. For how can one truly be a free man when his property is not his to do with as he wishes? Russell Kirk, a man who has had a big impact on 20th century conservatism and has helped to shape it going into the new millennia was quoted as saying that conservatism is “the negation of ideology.”
How is that ‘negation of ideology’ translated into today’s conservative movement? The word ‘conservative’ is derived from the Latin verb, conservare, meaning to preserve or to save. So by its very nature, it would seem that to be Conservative is to hold onto the past. Then how do we arrive at what seems to be an oxy-moron such as ‘modern conservatism?’ How does one combine 21st century thinking with a traditional approach to life and politics? It’s not that difficult, really. I think Kirk was onto something important when he called it ‘the negation of ideology.’ For if one is to examine the Statist’s modus operandi, it is clear that amassing power and expanding the role of government in the life of the “masses” is his number one priority. It has been said that the far left, which is the controlling faction of the Democratic Party at this time, is part and parcel with big government. In other words, the Democratic Party needs big government for power and big government needs the Democratic Party to exist. It is a symbiotic relationship that is troubling to say the least and dangerous in the extreme.
To be honest, some Republican Presidents have increased government spending as well. Let’s look at Ronald Reagan. He did increase government, but he did it in a slightly different way. Reagan dramatically cut the role of the Federal Government in domestic programs and shifted the focus to increasing the military. Of course, this is well known today to be one of the leading reasons for the collapse of the Soviet Union. So this begs the question, did Reagan increase or decrease the role of government in our lives? On the domestic front, he dramatically decreased it, so the argument can be made that he was a small-government conservative. If one takes into the account the expanded size of the Federal Government due to the military build-up during the Reagan years then the answer seems less clear unless you remember one key factor.
It specifically calls for the Federal Government to provide for the common defense; it does not call for entitlements, or other socialistic programs. So in retrospect, Reagan was definitely a true conservative.
It is very unfortunate that we do not have a true conservative in the White House at this time. Instead we have a man who was raised by Marxists, steeped in Communism and cut his political teeth in Chicago while studying the Alinsky method of community organizing.
Barack Obama is the most pure statist in American history to ever occupy the Oval Office. If you only look at the unprecedented spending undertaken by this administration, then you see that we are on a course of financial ruin.
$787 billion stimulus package which morphed into $1.6 trillion in spending
$400 billion “son of stimulus”
$700 billion Wall Street bailout package
$1.7 trillion Obamacare
trillion dollar deficits almost every year he has been in office
explosion in the National Debt, from $10 trillion to $18.7 trillion today, and looking to be north of $20 trillion by the time he leaves office
To assail his critics at the time, Obama promised to find $17 billion in cuts from his obscenely bloated budget. If it weren’t so scary, it would be laughable. As Senator Judd Gregg (R-NH) said, “It’s as if you took a teaspoon of water out of the bathtub while you left the spigot on at full speed.”
So what we, the American public have been stuck with is the bill for a pure Statist’s Utopian dream. Can we afford this? Can our children or our grand-children afford this? The answer is no and it is only one of the many reasons why we need conservatism so much right now. So let us choose carefully who we decide to put into the Oval Office in 2016. We can ill afford another term of statism on steroids; and that is exactly what has happened. President Obama has led our country down the winding road of socialism. He made a promise to “fundamentally transform the United States of America,” and that is unfortunately the one campaign promise he has attempted to keep.
But it isn’t just his spending that makes Barack Obama the most dangerous President the United States has ever had.
As the list of his insane spending boggles the mind, so too will this list of his scandals and lawless actions.
Implemented portions of the Dream Act, (which had been rejected by Congress) by Executive Order
Refused to prosecute violation of drug laws with certain mandatory minimums
Illegally refused to act on Yucca Mountain’s application to become a nuclear waste repository
Refusal to act during Benghazi terror attacks, which resulted in the deaths of four Americans in our Consolute in Lybia, and the resulting Cover-Up
Gave billions in Foreign Aid to the Muslim Brotherhood after their coup gave them control of Egypt
IRS Scandal in which Conservative groups were targeted ahead of the 2012 Presidential Elections
Continually re-wrote the ACA or ObamaCare Law via Executive Fiat
Implemented moratorium on offshore drilling in the Gulf of Mexico even after a Federal Judge ruled it invalid
Re-wrote Federal Bankruptcy Laws during GM’s and Chrysler’s bankruptcy proceedings, giving the UAW controlling interest in the auto companies
Government agencies are engaging in “Operation Choke Point,” where the government asks banks to “choke off” access to financial services for customers engaging in conduct the Administration does not like—such as “ammunition sales”
Declared the Senate in recess to illegally make appointments that required Senate approval
Targeted Fox News reporter James Rosen by falsely labeling him a possible “co-conspirator” in a criminal investigation of a new leak
Fast & Furious and the resulting cover-up
Targeted former CBS reporter Sharyl Attkisson because of her thorough coverage of the IRS scandal and the Benghazi Cover-Up
Granted Amnesty to millions of illegal aliens via Executive Order, after saying publicly for 6 years that he didn’t have the authority to do so
So what is Conservatism and why is it so desperately needed at this time in United States history?
Because we need to nominate a candidate that articulate Ronald Reagan’s message of “Morning in America,” showing a positive outlook that our best days are STILL ahead of us.
If we nominate another mushmouth candidate from the bushy center, who espouses the “big tent” philosophy, it will relegate the GOP to become the permanent 2nd Party.
If you stand for nothing, you’ll fall for anything and that is what is happening now. We need a platform of smaller government, lower taxes, less regulations, and more individual liberties, because a rising tide does in deed, lift all boats.
So, let’s remember as we approach the presidential primaries, we need a candidate that will unabashedly fly the flag of Conservatism. Choose carefully my friends, choose carefully.
Remember when we used to earn interest on our bank accounts? Ben Bernanke put a stop to that by printing money like it was going out of style. And now Janet Yellen is one-upping him. Forget zero interest, welcome to negative interest.
As the WSJ reports, far from paying for the privilege of holding other people’s cash (and why would they with nearly $3 trillion in positive carry excess reserves sloshing around) US banks – primarily of the TBTF variety – “are urging some of their largest customers in the U.S. to take their cash elsewhere or be slapped with fees, citing new regulations that make it onerous for them to hold certain deposits.”
The change upends one of the cornerstones of banking, in which deposits have been seen as one of the industry’s most attractive forms of funding, said more than a dozen corporate officials, consultants and bank executives interviewed by The Wall Street Journal.
Banks aren’t using their deposits to make loans anymore because the Fed’s trillions in excess reserves have made all that cash completely irrelevant.
And in a truly through-the-looking-glass paradox, the Fed says they’re pushing this thievery in order to make bank deposits “safer.”
U.S. banking rules set to go into effect Jan. 1 compound the issue, especially for deposits that are viewed as less likely to stay at the bank through difficult times.
The new U.S. rules, designed to make bank balance sheets more resistant to the types of shocks that contributed to the 2008 financial crisis, will likely have little effect on retail deposits, insured up to $250,000 by federal deposit insurance. But the rules do affect larger deposits that often come from big corporations, smaller banks and big financial firms such as hedge funds. Hundreds of companies and other bank customers with deposits that exceed the insurance limits could be affected by the banks’ actions.
Overall, about $4 trillion in deposits at banks in the U.S. were uninsured, covering more than 3.5 million accounts, according to Federal Deposit Insurance Corp. data
The rule primarily responsible involves the liquidity coverage ratio, overseen by the Federal Reserve and other banking regulators. The new measure, finalized in September, as well as some other recent global regulations, are designed to make banks safer by helping them manage sudden outflows of deposits in a crisis. The banks are required to maintain enough high-quality assets that could be converted into cash during a crisis to cover a projected flight of deposits over 30 days.
Because large, uninsured deposits would be expected to leave most quickly, the rule will now require that banks maintain reserves that they cannot use for profitable activities like making loans. That makes it much less efficient or profitable for banks to hold these deposits.
And what will the banks use to maintain these new reserves? Why the very financial instruments you’d want to move your now unprofitable deposits into.
Some argue that while it is a good policy on its face, the rule potentially magnifies problems in a recession by encouraging banks to hoard high-quality assets, potentially paralyzing markets for these assets such as Treasury securities and some corporate bonds.
“This proposal, which is supposed to promote financial stability, actually does the opposite,” said Thomas Quaadman, a vice president at the U.S. Chamber of Commerce.
The Obama Administration doesn’t want “stability.”
They want your money in the stock market, to keep the Dow and Nasdaq and S&P indexes artificially high. The only thing holding their illusion of a “recovery” afloat is the bubble in equities. It’s gotta stay pumped up until Obama leaves office (in order to cement his “legacy”) regardless of the risk to individual savers like you and me.
Practically speaking, it means that before all is said and done, banks will be charging usurious rates of interest on even the smallest bank deposits, in a push to get every last “saver” to reallocate their wealth away from pieces of fiat paper into pieces of paper promises (held by the DTCC no less) to be paid by increasingly more cash-flow deficient companies.
Yep, only 8 weeks into the new fiscal year and just to pay the freight on our debt, the Obama Treasury has already had to issue over a TRILLION DOLLARS in new debt.
The Daily Treasury Statement that was released Wednesday afternoon as Americans were preparing to celebrate Thanksgiving revealed that the U.S. Treasury has been forced to issue $1,040,965,000,000 in new debt since fiscal 2015 started just eight weeks ago in order to raise the money to pay off Treasury securities that were maturing and to cover new deficit spending by the government.
During those eight weeks, Treasury took in $341,591,000,000 in revenues. That was a record for the period between Oct. 1 and Nov. 25. But that record $341,591,000,000 in revenues was not enough to finance ongoing government spending let alone pay off old debt that matured.
So if you don’t have enough money, just pretend you do, issue NEW debt to cover the OLD debt and, well…..you’re the Federal Government!
The Treasury also drew down its cash balance by $45.057 billion during the period, starting with $126,568,000,000 in cash and ending with $81,511,000,000.
The only way the Treasury could handle the $942,103,000,000 in old debt that matured during the period plus finance the new deficit spending the government engaged in was to roll over the old debt into new debt and issue enough additional new debt to cover the new deficit spending.
There’s a term for that, it’s what got Bernie Madoff in trouble…
This mode of financing the federal government resembles what the Securities and Exchange Commission calls a Ponzi scheme. “A Ponzi scheme,” says the Securities and Exchange Commission, “is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors,” says the Securities and Exchange Commission.
“With little or no legitimate earnings, the schemes require a consistent flow of money from new investors to continue,” explains the SEC. “Ponzi schemes tend to collapse when it becomes difficult to recruit new investors or when a large number of investors ask to cash out.”
(CNSNews.com) – The number of foreign-born individuals holding jobs in the United States hit a record high of 25,019,000 in September, according to data from the Bureau of Labor Statistics (BLS). The BLS has been tracking the number of foreign-born workers annually since 2005 and monthly since 2007. The BLS does not distinguish between foreign-born individuals who are in the United States legally and those who are here illegally.
“The foreign born are those who reside in the United States but who were born outside the country or one of its outlying areas to parents who were not U.S. citizens,” the BLS explains. “The foreign born include legally-admitted immigrants, refugees, temporary residents such as students and temporary workers, and undocumented immigrants. The survey data, however, do not separately identify the numbers of persons in these categories.”
Obama’s economy continues to bring Hope and Change to Americans of all ages and income brackets. Well, to be more specifi, the lower income brackets get the Hope and the very rich continue to keep the Change.
However, The Daily Caller never dreamed it would come to this: A socialist party that wants to raise the federal minimum wage to $20 per hour is currently advertising a job for an experienced web developer paying $13 per hour.
It seems the Freedom Socialist Party advocates for, “an increase in the minimum wage “to $20 an hour” for all employees in all jobs“, just not the ones they pay the wages for…
This month, the Freedom Socialist Party placed an ad on both Indeed.com and Craigslist seeking a part-time web content manager in Seattle. The job pays $13 per hour (or more, maybe, if you are really good).
If you are interested in applying for the $13-per-hour web content manager job, it won’t be easy. For starters, you’ll need to be “familiarity with HTML/CSS” and Photoshop. The latter is a graphics editor developed by Adobe Systems, an $18 billion private company. You’ll also need “ability to self-manage and problem-solve independently.” Proficiency in Spanish and social media as well as “an interest in ongoing political events” are desirable. And absolutely no telecommuting!
So evidently they want everyone else to be employed full time at 20 bucks an hour – just not THEIR employees…
In case the Freedom Socialist Party yanks its ad, here’s a screenshot as it appeared on Indeed.com:
It has been some time since this topic has been discussed. You see, 2014 has been a year of changed focus. Much of the year has gone by with us focused on the very real threat of Islamic terrorists who seek to do us harm. And on the rest of the Middle East, Israel, Palestine, etc. Ebola has commandeered its fair share of news coverage with the deaths it has caused and even coming to the United States, and rightfully so. All of these are serious issues that need to be discussed. They affect each and every one of us. But in changing the focus of our attention, something has been lost in the shuffle. The federal debt is still alive and kicking.
Oh, how I wish things were different. But as real as the dangers are that are posed by Islam and Ebola, so too is the danger of a federal government that shows no sign of abating its practice of spending and borrowing. In spite of President Obama’s claims to the contrary, federal spending is going up. It was steady around $3.5 trillion from 2009 through 2013. Records for fiscal 2014 show total federal spending to be $3.7 trillion and going up to $3.9 trillion in fiscal 2015. Projections for 2016 show another increase to $4.1 trillion. You can see these charts at US Government Spending.
President Obama and the liberals who like to tout their own policies are fond of claiming they are reducing the deficit. If you look at the numbers shown on the website I linked to, you will find that is true. The federal spending deficit has trended lower. However, the federal debt continues to climb higher and higher. The current federal debt is $17,855,841,077,000. In short form, that is called $17.9 trillion in debt. The projected federal debt for fiscal 2015 is projected to be $18.7 trillion. The amount of spin that is required to make that sound like a good thing is staggering.
The fiscal issues that have been such a major part of the national discussion since the financial crash in 2008 have become little more than background noise. Issues such as the fabricated war on women, homosexual rights, racism, and the discussion over the violence that is Islam have taken center stage. Some of these are legitimate issues, but some are nothing more than fabrications to keep our eyes off the issues that should be considered more important.
Make no mistake about this. When President Obama tells us we are doing better, but just can’t feel it yet, he is doing nothing but throwing up a smoke screen to obscure the issue. The federal debt continues to climb, but our wages are stagnant. The cost of doing any kind of business continues to go up, but the money with which we use to conduct that business is not.
Don’t be fooled into believing the financial stability of America is any better than it has been in the past couple of decades. It is not. Our children and grandchildren are faced with the seemingly insurmountable task of paying down the federal debt to a much more manageable level. If that can continues to be kicked down the road, it will run out of road at some point. What will America do then?
It seems all areas of our society are waking up to the nightmare that is named Obama…
As a celebrity chef, cookbook author, and TV personality, Emeril Lagasse is one of the most well known chefs in the country, and with a net worth of about $50 million and a food empire that brings in an estimated $150 million, he’s one of the wealthiest, too. So it was surprising to hear him say at a recent event that he has “nowhere to go, really—other than broke.”
The reason? Predictably, Big Government.
“It’s becoming a very challenging industry to become a very successful average restaurateur,” continued Lagasse. “I can’t charge $300 a person in my restaurant or I would not be in business. Am I using any different ingredients? Not really. Am I using any caliber of service staff? I don’t think so. I think our service is as good or better than most places.”
“And then you add all the Obama nonsense to what it’s become in the last several years. I don’t have anything against Mr. Obama. I’m just saying the way that, you know… the government should stay out of things. […] Pretty soon, they’re going to wipe a lot of the middle restaurateurs and restaurant cooks. […] If it continues, then watch: you’re going to have high-end, and you’re going to have fast food, and you’re going to have chain restaurants.”
Lagasse went on to lament that the areas in which he operates restaurants — including New Orleans, Las Vegas, and Bethlehem, Pennsylvania — have been hit particularly hard by the problems in the economy. “Somebody having a $12.99 meatball and pasta dish at my restaurant means a lot to them,” he said. “That’s like a special occasion.”
At the event, which was promoting his upcoming reality series “On the Menu,” Lagasse explained that despite really listening to people and being very connected to America, he doesn’t have the solution. “All I can tell you is the balance of the economic cycle is out of whack,” he said.
The economy isn’t growing because you’re hoarding money. Also, if you had any brains you’d get rich.
That’s what the Federal Reserve thinks of you folks not living on Wall Street.
The Great Facilitator of big government Federal Reserve is finally having to admit that, after six years of printing trillions of dollars and giving essentially free to the too big to fail or trust banks on Wall Street, their Quantitative Easing and Zero Interest Rate Policy program has failed to stimulate the economy and put people back to work (it did do fantastic job, however, of making the rich much richer). So, like all personalities or entities in Washington, D.C., they are looking for someone else to blame Not surprisingly, that someone else is you. Those that live in the rarefied air of the Fed have little to no respect for people who are not rich and they have a couple of messages for you:
So why did the monetary base increase not cause a proportionate increase in either the general price level or GDP?
The answer lies in the private sector’s dramatic increase in their willingness to hoard money instead of spend it. Such an unprecedented increase in money demand has slowed down the velocity of money. _ (Source)
Hoarding? Seriously? Some of you on Main Street are doing well to stay even these last six years. Most of you, however, are seeing your standards of living declining. What money could you possibly be hoarding? I guess the Fed’s thing is that if they are going to lie about who’s to blame, it may as well be a big lie.
Janet Yellen: America’s Marie Antoinette
Marie Antoinette, when informed that the French had no bread to eat, supposedly responded : “let them eat cake.” Janet Yellen, Chair of the Federal Reserve, also has a message for the teeming masses:
Speech–Chair Janet L. Yellen
The Importance of Asset Building for Low and Middle Income Households
At the Corporation for Enterprise Development’s 2014 Assets Learning Conference, Washington, D.C. (via prerecorded video) _ (Source)
In other words, what she said was : “Let them get rich.” Why didn’t you think of that? If six years ago you had sold everything you owned and lived like paupers, you could have invested most of your income on Wall Street and you would all now be rich. But, instead you apparently hoard all of your money. There’s probably a good reason she gave her message by prerecorded video.
I suggest you all send a reply message to the Fed. Please stand up and face in the direction of Washington, raise your right hand with the back of your facing away from you, and, at the count of three, fold all of your fingers except the middle one. 1 … 2 ….
Well, that’s what I’m thinking. What are your thoughts?
Census figures show that over a third of Americans are receiving some means tested welfare; i.e., Medicade, food stamps, housing assistance, and other forms of Temporary Assistance for Needy Families as was reported by Fox News in late August. Of course, this is not surprising to anyone paying attention. This so-called recovery which we are told we are experiencing has been very lopsided in favor of the upper income folks and especially the Wall Street crowd. Inflation is low according to the Federal Reserve, but most people are seeing their cost of living go up while income is stagnant or declining. I think it was economist Charles Hugh Smith who said it best a while back: “we are experiencing deflation in things we don’t need and inflation in the things we do need”. The unemployment rate is falling while the percentage of working age Americans with a job is decreasing. The jobs that are being created these past six years, which the Obama loves to brag about, are not keeping up with population growth and they are disproportionately low-income and/or part-time jobs.
If the politicians and think tanks on the Right have a plan for improving this moribund economy, I’ve not heard it. On the Left, however, “plans” abound from raising minimum wage to guaranteeing a “living wage” to “universal income” to, as reported here at Asylum Watch, the Council on Foreign Relations (CFR) has written a white-paper proposing that the Fed’s Quantitative Easing program of giving free money to Wall Street be replaced with a program to give free money to the good folks on Main Street. CFR believes this will get the masses spending more and drive up demand, which in turn, will cause employers to expand production and hire more workers. Although the CFR recognizes the inflationary effects of such a program, they believe the Fed could control inflation by carefully increasing interest rates.
But, here’s what the Left doesn’t tell us about their “free money” schemes:
Free Money Ain’t Free!
The Left, of course, never give a moment’s thought to what their give-away programs cost. I t is worth noting some of these socialist/Marxist are seeing that this peace meal approach is not working and so it is time, they believe, to go all-in and implement a “universal income“, as those at The Week recently did. After a long diatribe on how the policies of the heartless Right only make matters worse and how the policies of the caring Left don’t do enough, they came to this conclusion:
Therefore, one can easily imagine the historical process described by Marx going in reverse. In today’s labor market, where there are still twice as many job seekers as job openings, the constant conservative carping about the “dignity of work” sounds more jarring and vindictive by the day
As someone with a nice, stimulating job, I agree that work can help people flourish. But in an economy that is flatly failing to produce enough jobs to satisfy the need, a universal basic income will start to seem more plausible — even necessary.
Dear friends, you need to take this “free money” talk seriously. As the middle class continues to shrink, this idea is going to gain more traction.
Fortunately for those of us who seek information from alternative sources, there are some very smart people in the blogosphere. That includes my good friend at the Spellchek blog. (Do yourself a favor and mark his post as a must read!) My friend was inspired by the article at The Week to get out his calculator and put pencil to paper and see what kind of money this idea might entail. He used Switzerland as a base case since they will be voting referendum to provide a universal income of $33,600 per year to their citizens. The using U.S. Census Bureau numbers he began crunching the numbers: (Bold added)
What if we followed the lead of the Swiss and doled out $33,600 per year to each one of us? That equates to over $8.1 trillion dollars annually, just a tad more than the $1 trillion dollar welfare number were arguing about now. With an economy worth an estimated $17.3 trillion annually, a basic income at that level would eat up nearly 50% of everything produced. Except that doesn’t count. Only our federal budget spending does which was only a meager $3.5 trillion last year.
Worse yet, federal revenues were only $2.8 trillion. We borrowed the rest just to spend $3.5 trillion. Can you imagine if we had to cough up $8.1 trillion for a basic income program? In fact, the biggest budget expenditure we have currently is social security at $814 billion last year, or 24% of the budget. A basic income program would be ten times the size of social security.
Redistributing federal budget monies is only a partial solution. Private wealth must be tapped as well (retirement funds anyone?).
This exercise in futility is funny until you realize that so many people are serious about it. I mean, what if we just took the $1 trillion the left claims is pie-in-the-sky and divided that up amongst our 242 million recipients? That’s only $4,124 bucks a year. Think that wouldn’t send the $15 minimum wage crowd over the edge? That’s chump change to them.
The bottom line is that the seemingly eternal quest of the socialists is that spending other people’s money still doesn’t get us to nirvana. If they ever want to get serious about it than the full-fledged approach of communism is the only way. All wealth must be confiscated and handed out to the masses. And we all know how that approach turns out.
Got that? Total federal government spending would be the sum of $8.1 trillion, for the “universal income” and the current spending level of $3.5 trillion, or a total of $11.6 trillion!
Nobody is going to lend US that additional $8.1 trillion, therefore, it will have to be printed, won’t it? So, how high would the Fed have to raise interest rates to keep a lid on inflation? Right! That, as my friend said, leaves communism.
Well, that’s what I’m thinking. What are your thoughts?
Common sense tells us that if something becomes more expensive, less of it is consumed. And, if that something happens to minimum wage workers, the same is true.
A few days after Labor Day American Thinker ran a post titled Fast food strikers: meet your replacement robot. The article reported on how the far left SEIU had organized protests for raising the minimum wage to $15 per hour in several cities across America. Most of the protests took place near fast food restaurants. Many of the protestors were arrested for blocking traffic. The author believes that these protests by striking fast food workers and others were designed as a ” propaganda exercise aimed at fomenting anger that could turn into voting for Democrats in November.”
Okay. This is nothing new. What was interesting is what the author reported next:
Meanwhile, with perfect timing, a company called Momentum Machines debuted a hamburger-making robot…
The company’s robot can “slice toppings like tomatoes and pickles immediately before it places the slice onto your burger, giving you the freshest burger possible.” The robot is “more consistent, more sanitary, and can produce ~360 hamburgers per hour.” That’s one burger every 10 seconds.
The next generation of the device will offer “custom meat grinds for every single customer. Want a patty with 1/3 pork and 2/3 bison ground to order? No problem.”
Momentum Machines cofounder Alexandros Vardakostas told Xconomy his “device isn’t meant to make employees more efficient. It’s meant to completely obviate them.”
So, if the fast food industry decides to install these types of robots, it will result in the loss of one of the few opportunities teenagers of getting a job. The SEIU could care less about teenage unemployment. They are not really interested in minimum wage workers. Their interest clearly lays with their higher paid union members. It’s common for their contracts to have a clause that requires the employers to raise all wages every time the government passes a law increasing the minimum wage. This is true even where the employer has no minimum wage positions in their work force.
So, you parents of teenagers are just going to have to work harder so you can give your sons and daughters a bigger allowance and you may want to think about fixing up that attic over the garage because it may be years before your children will be able to leave the nest.
Well, that’s what I’m thinking. What are your thoughts?
Unfortunately for the romantics out there, it is not love that makes the world go around. It’s money that makes the world go around, right? Well, if you think of money as those units of currency you carry in your wallet or pocket, then no it’s not actual money. Actual money (currency) is in relatively short supply. No, what makes the world go around is money created out of thin air; otherwise known as credit or debt. Think fractional reserve lending. Credit/debt is money that was never generated by the real economic production of a good or service. Credit/debt is, however, a claim against the future real economic production of goods and services.
Credit, in and of itself, is not a bad thing. Most people could never hope to own a house or other big-ticket items, if it were not for credit. The problem comes when a nation’s economic growth becomes dependent on ever-increasing amounts of credit. Economies like ours depend on consumption. Credit allows for more consumption, which drives the producers of goods and service to expand and hire, which means more people have income and more people will use credit to consume the increased production of goods and services. Sounds great, right? Prosperity for all. A rising tide floats all boats. Unfortunately, there is always a “but” or, in the case of credit/debt, there are two “buts“. First, all debt must be paid back with interest. If it is not paid back, the lender takes a haircut and that diminishes the economy. And, this is important to understand. Although the credit money was not backed by real economic growth in goods or services, the interest and principle must be paid back from the real production of goods and services. Ouch!!! Second, as the economic pie grows, in part due to credit, it takes more credit to achieve the same result as earlier credit did. In other words, maybe there was a time when a dollar of credit generated 90 cents of economic growth. As time went by, it took $10 of credit to produce 90 cents of economic growth and then it took $100 and then $1000…. It;s the law of diminishing returns.
Today the world is buried in debt and America is no exception. If we were to ask any John or Jane Doe their opinion on debt in America today, they would likely throw up their hands and say how insane it is that our nation is more than $17 trillion in debt. It’s understandable they would talk about the national debt because that is the number that gets the most news coverage. Sadly, seventeen trillion dollars is only a small part of America’s indebtedness. If you look at the US Debt Clock, you will see in the upper right hand corner that our national debt is $17.5 trillion. But, scan down in the center ad you will see Total US Debt, the sum of federal, state, and local government debt and corporate debt and individual debt, is _ are you ready for this? _ $61.5 trillion. Now, if you look to the left on that same line, you will see that Americans are paying a whopping $2,5 trillion in interest payments on all of that debt.
Charles Hugh Smith, in this article, uses rounded numbers of $60 trillion in total debt and $2.4 trillion in interest being paid each year and points out something very disturbing. The economy, for the last several years, has been growing at a lack luster 1.5%. That means our approximately $16 trillion-dollar economy is growing at about $240 billion per year. Think about that for a moment. Our economy is growing at the rate of $240 billion per year while we are transferring over $2 trillion from the productive sectors of our economy to the banking sector; just in interest payments. And, this is after six years of the lowest interest rates ever! Interest rates have nowhere to go but Up! Then what? ( BTW, the CBO estimates that even at present low interest rates, the interest on the national debt will double in five years and triple in eight years.)
A commenter here at Asylum Watch recently suggested that we need to pass a law to stop borrowing. The Charles Hugh Smith article uses this graphic to show what happens when the beast isn’t fed regularly:
Taking the necessary corrective measure and the pain and suffering that entails was not politically acceptable in 2008 and it certainly is even more politically unacceptable today. The status quo is unsustainable but no one has the guts to stop feeding the beast; a beast we all helped to create with our spending, borrowing, and voting habits. The consumer driven, credit driven, ever expanding economy is an illusion. It always was an illusion. The bankers knew from the beginning that they would end up with all the marbles. After the smoke clears, the bankers will be there to offer the survivors a new start (credit).
Well, that’s what I’m thinking. What are you thoughts?
Today’s post complements yesterday’s post in which we talked about the faux recovery America has experienced since the so-called Great Recession of 2008. Monty Pelerin’s World has posted a graph and a chart that demonstrate clearly why most Americans are having a harder time making ends meet today than they were a decade or so ago. The following graph shows that most working
Americans have seen their nominal income increase over the last 14 years; but their real income after taxes and inflation has fallen by about 9% on average.
A fortunate few have earned promotions every three or four years and as a result their quality of life has improved. Everyone else and especially those on fixed incomes have taken a serious beating.
The Federal Reserve has been telling the public for years that inflation is a non-issue. For the average American, this chart shows clearly just how big of an issue inflation really is.
The road to the new world order is, I fear, a dark and dreary one.
Well, that’s what I’m thinking. What are your thoughts?
In the new landscape of the American labor market, jobs are easier to come by but hours remain in short supply.
New government data released Thursday showed the economy added 288,000 jobs in June — the fifth straight month gains have topped the critical benchmark of 200,000. The unemployment rate fell to 6.1 percent, down more than a percentage point over the past year.
But there’s a gnawing fear among some economists that the improving data provides false comfort. The number of people in part-time jobs jumped by more than 1 million in June to 27 million, according to the government’s data, making it one of the corners of the labor market that has been slowest to heal. That has led to worries that the workforce may be becoming permanently polarized, with part-timers stuck on one side and full-time workers on the other.
“What we’re seeing is a growing trend of low-quality part-time jobs,” said Carrie Gleason, director of the Fair Work Week Initiative, which is pushing for labor reforms. “It’s creating this massive unproductive workforce that is unable to productively engage in their lives or in the economy.”
The spike in part-time work since the recession has been largely involuntary. These workers may have had their hours cut or are unable to find full-time jobs, earning them the official designation of “part-time for economic reasons.” In June, their ranks swelled by 275,000 to 7.5 million. In 2007, 4.4 million people fell into this category.
So the good news, if you’re an Obamabot, is the economy added 288,000 new jobs last month. The Real News though is that 275,000 of those jobs are part-time.
Hope and change!
And then there are the drop-outs; folks who’ve given up on ever finding a job, even a “low-quality part-time” job.
The US unemployment rate dropped to 6.1% in June the lowest level since September 2008.
However the number of people not in the labor force also rose to a fresh record high of 92,120,000 up 111,000 since June.
In fact, there are more than 7 million fewer people in the workforce than when Obama took office. Add them back in to the mix and the unemployment rate tops out at over 12 percent.
When you raise taxes dramatically and roll out tons of burdensome regulations, a contracting economy is only a surprise if you’re an idiot. Or a member of this Administration and the press. But I repeat myself.
Sadly this Administration envisions no changes to its disruptive policies. Because they can’t, or won’t, admit they’re wrong. So, as long as they keep shoving in the same inputs, we’ll keep seeing the same abysmal outputs.
In other words, the beatings will continue until morale improves.