What happened to all of the doom and gloom economic threads?

[Acanthus]

You do need to read up on it more. Taxes, surcharges and such will start immediately.

Are you talking about the 0.5% income tax hike on the 200k+ bracket?

Surcharges on cosmetic surgery and "caddilac plans" are hotly contested and likely to change before the bill passes.

 

[Frisco_Slug_Esq]

A basic understanding of economics is what you need.

The jobs are coming back.

Fat chance. At this rate you will graduate straight to the bread line; too qualified for McDonalds, lacking the experience to compete against the glut of experience looking for work.

Even Economist-in-Chief Obama is getting nervous, so is his shill, the NY Times.

 

[Beco]

Err? If it passed now it wouldn't start until 2011.

how would you know?

 

[Beco]

New home starts down, home prices, they say, are up, but some say prices are down, existing homes up, figure out those numbers. Are we at a botom or not?

 

[Frisco_Slug_Esq]

New home starts down, home prices, they say, are up, but some say prices are down, existing homes up, figure out those numbers. Are we at a botom or not?

The went back and revised downward the happy happy economic report that showed the recession was over...




Not by fucking much.

 

[Frisco_Slug_Esq]

Why the pessimism? In short, we are doing nothing to prepare for the crises to come.

A global recession has led to low oil prices. Yet in this window of opportunity, America has not decreased its foreign-oil dependence. We are not encouraging domestic exploration. And we are still ambivalent on nuclear power.

But as the world economy recovers, oil will probably surge back over $100 a barrel, increasing our oil-import tab by 25 percent or more. The Obama administration, though, mostly is obsessed with subsidizing relatively small amounts of wind and solar power. It likely won’t be long before angry motorists at the pump are demanding to know why we have not pushed for more development at home of still-plentiful natural-gas and oil fields.

Meanwhile, other economic bad news may be just around the corner. Today, interest rates on short-term Treasury bills still are less than 1 percent. But they, too, will climb as business picks up and worries over American inflation spread.

If we have to pay foreign lenders 5 percent to 7 percent interest on our debt, as in the past, the increased costs will gobble up additional billions from our annual budget. Yet sadly again, we are missing this rare opportunity of low interest to pay off cheaply the trillions that we already owe. Instead, we are borrowing even more!

...

Finally, there is an array of taxes on the horizon — increased federal income-tax rates; promised hikes in health-care surcharge taxes; and even rumors of value-added federal sales taxes. These increases are said to be aimed at the proverbial wealthy. But that could change — given that the top 5 percent of households already provide 60 percent of the nation’s income-tax revenue. And many are already paying 50 percent to 60 percent of their incomes in combined local, state, federal, and payroll taxes.

Just consider. The price of gas will soon likely increase. The cost of servicing our profligate borrowing will, too. One more terrorist attack like at Fort Hood, or nightly sermons from a grandstanding Khalid Sheikh Mohammed, or a new Taliban offensive, and the momentum could shift to radical Islam in its decades-long war against the United States. Next year’s tax hikes will be real and large — and no longer just this year’s idle talk.

As these storm clouds gather, Congress bickers on Saturday nights about borrowing even more money for health-care reform, yet another federal entitlement.

If you think things have been rough so far, hang on, ’cause you ain’t seen nothing yet.

Victor Davis Hanson

More than ever, we need this Pres__ent with no id, uh..., to fail!

 

[Frisco_Slug_Esq]

As one financial crisis recedes, another may be beginning. In Dubai this week, we've had a foretaste of what may be to come as governments around the globe seek to grapple with the explosive growth of fiscal deficits and public debt.

Like everyone else, my regard for the miracle of Dubai's fast-evolving skyline has always been tempered with a high degree of scepticism. As a monument to the vanity and hubris of Sheikh Mohammed bin Rashid al-Maktoum, Dubai has long looked like an accident waiting to happen. Such has been the pace of development that nobody could have been surprised by the debt default now threatened. Only the assumed support of Dubai's richer neighbour Abu Dhabi, which is now far from certain, has prevented it happening sooner.

Yet the important question for markets today is not whether Dubai and Sheikh Mohammed can survive the sandstorm; in fact, that is almost irrelevant. Dubai's debts of $80 billion (£48 billion) are a tiresome and unwelcome irritant which will cause further write-downs among western banks, but in the scale of things not of great significance: Britain is planning to raise more than three times that amount in the debt markets in this financial year alone.

Rather, the issue is whether this folie de grandeur of a desert kingdom is just an isolated, and therefore containable, incident, or a more worrying outrider for a wider sovereign debt crisis which might eventually engulf major, advanced economies. Everyone thought the financial implosion of the last two years was largely behind us – yet Dubai has reminded us that if nations start defaulting, then it may be about to enter a new and even more frightening phase.

...

Across the developed world, public debt is set on an explosive course. According to new estimates by Moody's, the credit ratings agency, the total stock of sovereign debt worldwide will have risen by more than 50 per cent between the start of the financial crisis in 2007 and the end of next year, to $15.3 trillion.

But this is just the beginning. On current projections, that total is set to rise by at least a further 50 per cent, before finally peaking in four to five years' time, and then only if governments have by then taken remedial action.

These are uncharted waters, quite without precedent in peacetime. In seeking to address the financial and economic crisis of the past few years, countries have come close to bankrupting themselves. It is as if, in treating the patient, a physician has infected himself with the same deadly disease.

Perhaps oddly, financing these fast-growing deficits has not so far been a problem, at least for the major advanced economies. Risk-averse investors have spurred high demand for sovereign debt, in the possibly misguided belief that there can be no haven safer than assets guaranteed by taxpayers and the ability of their governments to print money.

...

Markets dashed to withdraw funding from Northern Rock, but in transferring the money to the likes of the Royal Bank of Scotland found that they had invested only in something even more unstable. The Rock, it turned out, was just an outlier in a systemically unsafe sector.

If Dubai is the sovereign debt equivalent of Northern Rock, then Greece might be its Bear Stearns and Japan its Lehman Brothers. But why stop there? For Citigroup, think the US, and for RBS and HBOS, think Britain. Only there would be no one to bail out their creditors if America or Britain showed signs of defaulting.

Of course, I am exaggerating to make a point. Nobody thinks this a likely outcome, even if it ought to be added that nobody thought the semi-nationalisation of RBS and HBOS remotely likely either. The judgment of the markets is that on present trajectories, the sovereign debt burden is just about manageable. But it's touch and go.

The credit ratings agencies are just itching to downgrade some of the big hitters, alongside the obviously more vulnerable, with Britain and America the first in line. If the markets start to demand a premium for their money, that's going to make the task of economic recovery and fiscal consolidation that much tougher. At the risk of sounding like a scratched record, this crisis is not over yet – not by a long chalk.

http://www.telegraph.co.uk/finance/...e-Dubai-begin-to-fail-who-will-save-them.html

 

[Ulaven_Demorte]

http://www.telegraph.co.uk/finance/...e-Dubai-begin-to-fail-who-will-save-them.html

The 'right' just keeps hoping against hope for failure.

How patriotic..

Meanwhile Black Friday sales were strong, property values are on the rise again, Leading Economic Indicators have been up for more than 6 months running..

 

[Frisco_Slug_Esq]

I know. It's the Obama Economic Miracle...





Why's he talking about the possibility of a double-dip recession?


Does he not believe as fervently as you do?

 

[Ulaven_Demorte]

I know. It's the Obama Economic Miracle...

Why's he talking about the possibility of a double-dip recession?

Does he not believe as fervently as you do?

Hope for the best.
Plan for the worst.

I know after 8+ years of reactionary lack of planning it's a difficult concept.

 

[Frisco_Slug_Esq]

I divested stocks and moved into gold.




We're nowhere near "recovery." You're just smug because you still have a job and Congress hasn't tapped you for the bill yet. But they will and we already know, you don't mind doing your patriotic duty and supporting your fellow man.

Did you see that business defaults are up?

 

[Ulaven_Demorte]

I divested stocks and moved into gold.

We're nowhere near "recovery." You're just smug because you still have a job and Congress hasn't tapped you for the bill yet. But they will and we already know, you don't mind doing your patriotic duty and supporting your fellow man.

Did you see that business defaults are up?

Gold? *laugh* Please tell me you didn't fall for the profiteering of the company that Glenn Beck, Limbaugh and other "right" pundits were pushing.. Goldline, just to name one, was pulling in a hefty profit based on the unsophisticated listeners of right wing talk by having Beck and Limbaugh tell them that they had better buy gold before the dollar becomes worthless.. Of course they were making somewhere in the neighborhood of a 30 - 35% profit on every transaction.. The average stock broker commission is around 2%. They sure saw you coming didn't they? Capitalism at it's best, taking advantage of the stupid and greedy.

You didn't actually dump your stocks when they were down and made your losses permanent did you? Good lord, that would explain why you're actively rooting for another economic disaster..

As for the Business defaults.. No shit, they're up from a year ago, when the country (the 'right' at least) was still busily denying that there was an economic problem at all...

 

[Frisco_Slug_Esq]

Gold? *laugh* Please tell me you didn't fall for the profiteering of the company that Glenn Beck, Limbaugh and other "right" pundits were pushing.. Goldline, just to name one, was pulling in a hefty profit based on the unsophisticated listeners of right wing talk by having Beck and Limbaugh tell them that they had better buy gold before the dollar becomes worthless.. Of course they were making somewhere in the neighborhood of a 30 - 35% profit on every transaction.. The average stock broker commission is around 2%. They sure saw you coming didn't they? Capitalism at it's best, taking advantage of the stupid and greedy.

You didn't actually dump your stocks when they were down and made your losses permanent did you? Good lord, that would explain why you're actively rooting for another economic disaster..

As for the Business defaults.. No shit, they're up from a year ago, when the country (the 'right' at least) was still busily denying that there was an economic problem at all...

No, dumbass, I even chronicled when I took my money out, about a month to six weeks before the obvious occurred as Obama gained steam.

Then, I also chronicled when, for tax purposes, my wife put some back in when we were at the bottom.

I'll tell you when I pull that out too because right now, I'm beating the market returns over the last decade. It's not rocket-science, if rocket science is even rocket science anymore, it is peer-reviewed you know...

Hell, like Glow Ball Warning, it might have drug itself down to the levels of economics, I mean, when was the last time we put a man on anything other than the Soviet-American space station?

Assuming you want some advice. But don't worry, if Democrats keep winning elections, neither one of us will be allowed to keep our ill-gotten and greedy gains. What were we thinking" We should have run right out and given it to charity...

__________________
We left corporate America, which is a lot of what we're asking young people to do. Don't go into corporate America. You know, become teachers. Work for the community. Be social workers. Be a nurse. Those are the careers that we need, and we're encouraging our young people to do that.
Michelle Obama

 

[Killswitch]

You can make some gold belt buckles and have a roadside stand on the reservation and sell them to tourists, Kemosabe.

Buy a little silver and some turquoise, maybe some beads and you're in like flint. lol

 

[Frisco_Slug_Esq]

You can make some gold belt buckles and have a roadside stand on the reservation and sell them to tourists, Kemosabe.

Buy a little silver and some turquoise, maybe some beads and you're in like flint. lol

Beats mowing lawns.


Learn how to use the K-word Hmmmkay?

 

[Killswitch]

Where's me Gold!

 

[Frisco_Slug_Esq]

That's racist.

 

[Killswitch]

That's racist.

Yeah I hate the Irish.

lol

 

[Frisco_Slug_Esq]

'Cause they drink, or cause of Charlie Weis?

 

[Frisco_Slug_Esq]

Tiny bubbles...





Dubai

 

[Frisco_Slug_Esq]

Moanin' U_D...

The Federal Reserve's Open Market Committee meets today, and right on time. Yesterday's producer price report showed that wholesale business prices rose 1.8% in November, or a 6.3% annual rate over the past three months and 2.4% over the past year.

The news hit markets with a jolt, because investors have become accustomed to the Fed's assurances that it must keep interest rates at their current historic lows for an "extended period" because the only real economic risk is deflation. Investors reacted by sending bond prices down sharply, as they wondered if the Fed may have missed its bet and will have to change course sooner than it has advertised.

Fed Chairman Ben Bernanke is notoriously stubborn, at least when he's easing money. And no doubt someone at the Fed will point out that if you remove food and energy from yesterday's report, then producer prices rose by only 0.5%. However, this is the same "core" price rationalization the Fed used earlier this decade to keep monetary policy too easy for too long. Deflation was another siren song that the Fed used in 2003 and 2004 to build the credit mania that led to the bubble, the blowoff and recession.

Like $1100 gold and $70 oil amid weak global energy demand, the producer price report is a warning that the Fed should already have begun to move back to a noncrisis monetary stance. This does not mean "tightening" in any normal definition of that word. Moving from near-zero rates to 1% would not be moving to a restrictive policy. It is the equivalent of slowing down from 200 miles per hour to 180 or 160. A more careful monetary policy will help the Fed's credibility and reduce the chances that the recovery is later cut short by an abrupt shift in policy.

Printed in The Wall Street Journal, page A26

 

[Frisco_Slug_Esq]

The Audacity of Debt
WSJ

At least someone in America isn't feeling a credit squeeze: Uncle Sam. This week Congress will vote to raise the national debt ceiling by nearly $2 trillion, to a total of $14 trillion. In this economy, everyone de-leverages except government.

It's a sign of how deep the fiscal pathologies run in this Congress that $2 trillion will buy the federal government only one year before it has to seek another debt hike—conveniently timed to come after the midterm elections. Since Democrats began running Congress again in 2007, the federal debt limit has climbed by 39%. The new hike will lift the borrowing cap by another 15%.

There is surely bipartisan blame for this government debt boom. George W. Bush approved gigantic spending increases for Medicare and bailouts. He also sponsored the first ineffective "stimulus" in February 2008—consisting of $168 billion in tax rebates and spending that depleted federal revenues in return for no economic lift.

[I blamed Bush too, A_J]

Democrats ridiculed Mr. Bush as "the most fiscally irresponsible President in history," but then they saw him and raised. They took an $800 billion deficit and made it $1.4 trillion in 2009 and perhaps that high again in 2010. In 10 months they have approved more than $1 trillion in spending that has saved union public jobs but has done little to assist private job creation. Still to come is the multitrillion-dollar health bill and another $100 billion to $200 billion "jobs" bill.

We've never obsessed over the budget deficit, because the true cost of government is the amount it spends, not the amount it borrows. Milton Friedman used to say that the nation would be far better off with a budget half the current size but with larger deficits. Mr. Obama and his allies in Congress have done the opposite: They have increased the budget by 50% and financed the spending with IOUs.

Our concern is that the Administration and Congress view this debt as a way to force a permanently higher tax base for decades to come. The liberal grand strategy is to use their accidentally large majorities this year to pass new entitlements that start small but will explode in future years. U.S. creditors will then demand higher taxes—taking income taxes back to their pre-Reagan rates and adding a value-added tax too. This would expand federal spending as a share of GDP to as much as 30% from the pre-crisis 20%.

Remember the 1980s and 1990s when liberals said they worried about the debt? We now know they were faking it. When the Gipper chopped income and business tax rates by roughly 25% and then authorized a military build-up, Democrats and their favorite economists predicted doom for a decade. The late Paul Samuelson, the revered dean of the neo-Keynesians, expressed the prevailing view in those days when he called the Reagan deficits "an all-consuming evil."

But wait: Those "evil" Reagan deficits averaged less than $200 billion a year, or about one-quarter as large in real terms as today's deficit. The national debt held by the public reached its peak in the Reagan years at 40.9%, and hit 49.2% in 1995. This year debt will hit 61% of GDP, heading to 68% soon even by the White House's optimistic estimates.

Our view is that there is good and bad public borrowing. In the 1980s federal deficits financed a military buildup that ended the Cold War (leading to an annual peace dividend in the 1990s of 3% of GDP), as well as tax cuts that ended the stagflation of the 1970s and began 25 years of prosperity. Those were high return investments.

Today's debt has financed . . . what exactly? The TARP money did undergird the financial system for a time and is now being repaid. But most of the rest has been spent on a political wish list of public programs ranging from unemployment insurance to wind turbines to tax credits for golf carts. Borrowing for such low return purposes makes America poorer in the long run.

By the way, today's spending and debt totals don't account for the higher debt-servicing costs that are sure to come. The President's own budget office forecasts that annual interest payments by 2019 will be $774 billion, which will be more than the federal government will spend that year on national defense, education, transportation—in fact, all nondefense discretionary programs.

Democrats want to pass the debt limit increase as a stowaway on the defense funding bill, hoping that few will notice while pledging to reduce spending at some future date. Republicans ought to force a long and careful debate that educates the public. Ultimately, the U.S. government has to pay its bills and the debt limit bill will have to pass. But debt limit votes are one of the few times historically when taxpayer advocates have leverage on Capitol Hill. Republicans and Democrats who care should use it to discuss genuine ways to put Washington on a renewed and tighter spending regime.

"Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren," Senator Barack Obama said during the 2006 debt-ceiling debate. "America has a debt problem and a failure of leadership. Americans deserve better." That was $2 trillion ago, when someone else was President.

 

[unregistered]

 

[Frisco_Slug_Esq]

I thought just a week or two ago WE was expecting it...

 

[unregistered]