No Blank Checks For Obama

See: Speaker Boehner's Debt Ceiling Speech

Speaker Boehner tells President Obama to get stuffed.

The sad truth is that the president wanted a blank check six months ago, and he wants a blank check today. That is just not going to happen.

You see, there is no stalemate in Congress. The House has passed a bill to raise the debt limit with bipartisan support. And this week, while the Senate is struggling to pass a bill filled with phony accounting and Washington gimmicks, we will pass another bill - one that was developed with the support of the bipartisan leadership of the U.S. Senate.

Obviously, I expect that bill can and will pass the Senate, and be sent to the President for his signature. If the President signs it, the 'crisis' atmosphere he has created will simply disappear. The debt limit will be raised. Spending will be cut by more than one trillion dollars, and a serious, bipartisan committee of the Congress will begin the hard but necessary work of dealing with the tough challenges our nation faces.

The problem is not on the revenue side. It is on the spending side.

Raising taxes only robs the productive of the means and the reason to produce.

Raising spending only feeds the addiction of the looter's to other people's money.

Raising the Debt Limit only increases the already unmanageable levels of debt that are being passed on to future generations.

We might be better off to just shut it all down.

Eat The Rich!

See: Get Ready for a 70% Marginal Tax Rate

But wait, things get worse. As Milton Friedman taught decades ago, the true burden on taxpayers today is government spending; government borrowing requires future interest payments out of future taxes. To cover the Congressional Budget Office projection of Mr. Obama's $841 billion deficit in 2016 requires a 31.7% increase in all income tax rates (and that's assuming the Social Security income cap is removed). This raises the top rate to 52.2% and brings the total combined marginal tax rate to 68.8%. Government, in short, would take over two-thirds of any incremental earnings.

How hard would you work if you were only able to keep 30 cents of every dollar that you earned?

Wheelbarrows of Dollars against Barrels of Oil

If you pull a dollar out of your pocket, you can almost see it shrink before your very eyes.

See:Don't Like a Weak Dollar? Might as Well Get Used to It

Weakness in the US dollar, which is causing everything to go up—including gas prices, food and stocks—is unlikely to go away soon as a selling frenzy hits the currency market.

Oil is a commodity. Oil is fungible. The value of the dollar will affect the dollar price of a barrel of oil.

The Pending Crisis And Growing Analogies To Greece

From the “Are we having fun yet?” files comes this bit of happy commentary from Former Federal Reserve Chairman Alan Greenspan.

See: Greenspan Says U.S. May Soon Reach Borrowing Limit

“The federal government is currently saddled with commitments for the next three decades that it will be unable to meet in real terms,” Greenspan said. The “very severity of the pending crisis and growing analogies to Greece set the stage for a serious response.”

Greece?

That will suck.

Roller Coaster Market Ride - Are We Having Fun Yet?

See: Bank Risk Soars to Record, Default Swaps Overtake Lehman Crisis

May 7 (Bloomberg) -- The cost of insuring against losses on European bank bonds soared to a record, surpassing levels triggered by the collapse of Lehman Brothers Holdings Inc., as the sovereign debt crisis deepened.

Like on an old wooden roller coaster, our economic cars have been pulled slowly to the top again after the first plunge, tickity tickity tickity all the way up.

Now, here we are at the the top of the second rise, at the long breathless moment where the cars just kind of sit there, slipping slowly forward as we get our first look at the deep drop before us. No more tickity tickity. The brakes are now off.

In moments, there will be little that we can do but throw our hands up in the air and scream in the downward plunge.

Are we having fun yet?

Record Levels Of Welfare, Unemployment And Other Government Benefits

See: American reliance on government at all-time high

Without record levels of welfare, unemployment and other government benefits as well as tax cuts last year, the income of U.S. households would have plunged by an astonishing $723 billion — more than four times the record $167 billion drop reported last month by the Commerce Department.

Moreover, for the first time since the Great Depression, Americans took more aid from the government than they paid in taxes.

[emphaisis is mine]

All of that is paid for somewhere. Watch your wallet.

Fun times ahead.

Obama Backer George Soros And The Collapse Of The Euro

See: Man who broke the Bank of England, George Soros, 'at centre of hedge funds plot to cash in on fall of the euro'

A secretive group of Wall Street hedge fund bosses are said to be behind a plot to cash in on the decline of the euro.

This may be an interesting summer.

Gasoline Prices Going Up In A Down Economy?

Gas prices are set to rise soon.

See: Experts: Gas prices in Chicago to top $3

What's pushing prices higher is the crude oil that's used to make motor fuel, said Fred Rozell of the Oil Price Information Service. Crude is an international commodity that has become ever more expensive as demand grows in China. As crude prices increase, so do gas gas prices.

Don't be shocked if the price per gallon goes up well over the $3 dollar mark,

In the not too distant future, some dumb and/or dishonest Democrats will be raising a stink about the rising price of gasoline (petrol) at the pump. Being economically challenged from their starting point, the complexities of supply and demand are not something that the Democrats care much about nor do they know how to cope with them save to use them to engage in class-warfare rhetoric.

The markets are rational. There is an increasing demand for certain types of crude. Other buyers are now on the market. The commodities markets, particularly the oil markets, are less and less directly tied to the American economy.

There is also the additional influence of the changing value of the dollar to account for. As the value of the dollar falls due to the actions of the Democrats and the Obama Administration, the dollar price of the commodity will also rise.

Shit will happen. Democrats will promote class-warfare. And the sun will also rise.

Greedy Democrats Lusting For A Tax On Gold

Democrat greed knows no bounds. Hungry for revenue from any source that She and her fellow Democrats can think of, the Governor Of Washington State is lusting for a sales tax on gold and other precious metals.

See: Is Washington's tax exemption on bullion a gold mine?

Gov. Chris Gregoire repeatedly has singled out the bullion tax break since she ran for her first term in 2004 as an example of the sort of preferential treatment that ought to end.

The governor followed through this year, proposing to start taxing bullion sales as part of her budget proposal to the Legislature. State-employee unions, interested in staving off job cuts, have come out in support.

The State-employees unions are the most powerful lobbies in the state of Washington. They have the Democrats by the short hairs. What they want, they get.

Unfortunately, the real world will not cooperate as slavishly as the Democrats and their State-employee union puppet-masters would like.

The association estimates there are now at least 100 coin and bullion dealers in the state — small coin shops and larger dealers who also sell gold as an investment for retirement accounts. Their businesses would be in jeopardy if the state reinstitutes the sales tax, Robinson said.

As an added blow, national coin-dealer trade shows no longer would consider meeting in Washington.

Because the price of gold is set like a stock on a national market, dealers operate on only a 1 to 3 percent markup, said Karen Feldman, who owns Tacoma Mall Blvd Coin Stamp & Jewelry.

Gold is selling at more than $1,000 an ounce, so if Washington dealers had to tack on a sales tax of nearly 10 percent, it would add about $100 to the price of a 1-ounce gold Krugerrand, Feldman said. Customers simply would buy gold on the Internet or in Oregon and Idaho, which don't tax bullion sales.

A tax on precious metal trades in Washington State would just move the transactions somewhere else. It is a predictable result. The Democrats are just too possessed by greed to give a tinker's damn.

HT: Fenway Nation

See Comment in Do You Deserve To Have Your 401k And Your IRA Confiscated?

Make Them Work For Free Dammit!

The Left's war against the productive continues.

The UK has imposed an onerous tax on Bonuses paid out to bank executives and employees. (See this CNN Article.)

NEW YORK (Fortune) -- The odds aren't on its side, but a bonus tax could happen in the United States too.

The United Kingdom this week slapped a 50% tax on bankers' bonuses above about $40,000. The one-time tax will be paid by all banks with employees in the country. France pledged it would adopt the same policy, while Germany's chancellor called the idea "charming."

What would stop US Politicians from bringing this onerous tax to the US?

What would stop them from making it applicable beyond just bank employees?

Can you really trust them to not make it apply to you?

7% of all U.S. banks are on the list and face a higher probability of failure

An article in the Wall Street Journal talks about the growing number of banks that are at risk of failure.

The FDIC's quarterly banking profile, which analyzed data from 8,099 federally insured banks, reported that 552 financial institutions, with combined assets of $345.9 billion, were on the government's problem list at the end of September, up from 416 with $299.8 billion of assets at the end of June. That means roughly 7% of all U.S. banks are on the list and face a higher probability of failure.

FDIC officials don't disclose the names of banks on the list, in part because it could lead to bank runs.

With the dollar crashing and hyperinflation looming on the horizon, hard times seem to be a real and growing possibility.

Will the Real Jobless Rate Please Stand Up!

There is something a little “Slim Shady” about the official US jobless rate of 10.2%.

Jeff Cox at CNBC.com has an article posted that is worth reading.

According to the government's broadest measure of unemployment, some 17.5 percent are either without a job entirely or underemployed. The so-called U-6 number is at the highest rate since becoming an official labor statistic in 1994.

The number dwarfs the statistic most people pay attention to—the U-3 rate—which most recently showed unemployment at 10.2 percent for October, the highest it has been since June 1983.

Pray for recovery, prepare for depression.

Get off your ass and get a job!

The truth behind much of the economic happy-talk that the Obama administration is putting out is that we are in hard times at the moment, with the probability of things getting far worse.

Nouriel Roubini has an article in the New York Daily News that is worth taking a few moments to read.

Think the worst is over? Wrong. Conditions in the U.S. labor markets are awful and worsening. While the official unemployment rate is already 10.2% and another 200,000 jobs were lost in October, when you include discouraged workers and partially employed workers the figure is a whopping 17.5%.

While losing 200,000 jobs per month is better than the 700,000 jobs lost in January, current job losses still average more than the per month rate of 150,000 during the last recession.

If you have a job, try to keep it.

If you don't, then you had better be busting your ass to get one. Every day that goes by that you remain unemployed increases the number of people that are in line with you looking for work. Many o these people will be better qualified and more desirable for a company to hire than you are.

Do not rest on your laurels – you don't have any.

Be prepared for some rough times.

The American Public “Getting Reamed.”

The Politico has a short piece about the 1,990 + page monstrosity that house Democrats are going to try to cram down our throats.

They cite a section as a caution to those that will clammer for it to be read before it is voted on.

“(a) Outpatient Hospitals – (1) In General – Section 1833(t)(3)(C)(iv) of the Social Security Act (42 U.S.C. 1395(t)(3)(C)(iv)) is amended – (A) in the first sentence – (i) by inserting “(which is subject to the productivity adjustment described in subclause (II) of such section)” after “1886(b)(3)(B)(iii); and (ii) by inserting “(but not below 0)” after “reduced”; and (B) in the second sentence, by inserting “and which is subject, beginning with 2010 to the productivity adjustment described in section 1886(b)(3)(B)(iii)(II)”.

Um . . .

Yah. . .

I got that.

A sane person, in the everyday life that you and I live in, would look at that pile of gobblygook and rightfully conclude that the person spewing it was trying to get one over on us.

For the Democrats in Washington D.C., it is how they hide what they are going to do to us.

At the end of the article, the Politico closes with the following paragraph.

But Republican Rep. Joe Barton, who is Texan, said the bill is “about four reams of paper” that add up to the American public “getting reamed.”

Thats Democrats just doing what they do best Joe.

Rationed Health Care is going to be just to die for.

Producers going on strike in New York

It is not exactly something out of Atlas Shrugged, but it has strong echoes.

Andy Soltis talks about a trend that few others in the MSM dare mention.

New Yorkers are fleeing the state and city in alarming numbers -- and costing a fortune in lost tax dollars, a new study shows.

More than 1.5 million state residents left for other parts of the United States from 2000 to 2008, according to the report from the Empire Center for New York State Policy. It was the biggest out-of-state migration in the country.

The vast majority of the migrants, 1.1 million, were former residents of New York City -- meaning one out of seven city taxpayers moved out.

"The Empire State is being drained of an invaluable resource -- people," the report said.

What's worse is that the families fleeing New York are being replaced by lower-income newcomers, who consequently pay less in taxes.

The parasitic welfare state can't keep raising taxes with out exhausting its hosts, namely the productive. The productive can move. They can even quit or just simply retire.

In New York, they are moving out.

In a few years when the retirement boom hits, they will probably just up and quit(retire).

In the long run, John Maynard Keynes is still dead

The ABC News website has an article by Mark Trumbull discussing the waning expectations that the "stimulus bill" will be able to help "stimulate" any future economic growth.

Americans hoping for a big economic boost from President Obama's economic stimulus programs got a douse of cold water Thursday: The White House's top forecaster said the largest impact of the stimulus on economic growth is probably in the rear view mirror.

That's the case even though unemployment continues to rise and many of the stimulus dollars haven't been spent.

"Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009," Christina Romer, who chairs the President's Council of Economic Advisers, said in testimony prepared for Congress. "By mid-2010, fiscal stimulus will likely be contributing little to growth."

In the long run, John Maynard Keynes is still dead. Unfortunately, his economic prescriptions will not die.

When government spends money, it is spending other peoples money. There is a natural disconnect of the value placed on the money by those who earned it when it is spent by those who merely appropriated it.

Stolen money is cheap. Earned money is dear.

Earned money is far more likely to be spent with care than looted money.

No politician and no bureaucrat can ever be as invested in the outcome of the spending of an appropriated dollar then the person that originally earned it. Whether that dollar is spent on a pleasure or invested for the future, the one who earned it is the only one that is able to truly appreciate what that dollar cost him to earn.

To a person that earned a dollar, the notion that it should be used to pay one person to dig a hole and to then pay another person to fill it, sounds like utter madness. To a Keynesian that appropriated a dollar earned by someone else, it is eminently economically sound.

Obama Manages To Blow It With France

Crispian Balmer of Reuters reports on Sarkozy's frustrations with the Obama Administration.

Stung by perceived snubs from U.S. President Barack Obama and encouraged by the growing importance of the G20, Sarkozy is increasingly reaching out to non-aligned states in an effort to extend France's international influence.

He has forged especially close ties with Brazil, is seeking alliances in central Asia and is intensifying his activities in the Middle East, using multi-billion dollar military and civilian nuclear trade deals as his calling card.

These initiatives are being played out against a discordant tone in Franco-American relations. This lack of harmony does not constitute a crisis, but is nonetheless raising eyebrows.

Nobody needs to root for Obama to fail. He is managing that very ably on his own.

Dancing with the Devil in the pale moonlight.

The problem with accepting the Devils coin is that you will end up dancing to the Devil's tune.

This is proving to be undeniably the case for those companies who have accepted a portion of the 2008 - $700 billion dollar bailout.

It was a Faustian deal. For a pittance, they have sold their corporate souls to the Obama Administration.

Now, day by day, instance by instance, they are discovering that they no longer own themselves. They no longer can decide for themselves what they should do, what is best for their company or what is best for their shareholders. Those decisions now belong to the occupant of 1600 Pennsylvania Ave and his minions.

WASHINGTON (AP) -- The Obama administration plans to order companies that received huge U.S. government bailouts last year to sharply cut the compensation of their highest paid executives, according to a person familiar with the decision.

The seven companies that received the most assistance will have to cut the annual salaries of their 25 highest-paid executive by an average of about 90 percent from last year, said the person, who spoke on condition of anonymity because it has not been announced.

This person said Wednesday that the Treasury Department will announce the deep pay cuts within the next few days.

Kenneth Feinberg, the special master at Treasury appointed by Obama to handle compensation issues at the seven firms getting exceptional assistance from the government's $700 billion financial bailout package, is making the pay decisions.

The seven companies are: Bank of America Corp., American International Group Inc., Citigroup Inc., General Motors, GMAC, Chrysler and Chrysler Financial.

Total compensation for the top executives at the seven firms will decline, on average, by about 50 percent, according to the person familiar with the administration's decision.

Read these articles.

U.S. Said to Order Deep Pay Cuts at Bailed-Out Companies

Pay Czar to Slash Compensation at Seven Firms

US plans big pay cuts at bailout firms

Some people think that Fascism is when the corporations own the government. They have it back-ass-wards. In actuality, Fascism is when the government owns the corporations.

---

Have you ever danced with the Devil in the pale moonlight?

Bailing out small banks and small businesses.

Jim Kuhnhein reports on Obama's new push to have TARP cover small banks and small businesses. There is also some talk of extending the TARP program out to October of 2010.

Of course, the thing to worry about now is whether or not the small businesses and small banks that accept any of this bailout money will become subject to the same intimidation tactics that they feds have been playing against BofA.

WASHINGTON — President Barack Obama wants smaller community banks to have greater access to the government's $700 billion financial rescue fund to assist small businesses that are still suffering from a prolonged credit crunch.

Obama on Wednesday plans to announce a package of initiatives designed to increase lending, including a request that Congress increase caps for existing Small Business Administration loans, the administration said.

The new effort comes as the administration is under pressure from liberals to shift the massive bailout fund's focus away from helping big financial institutions and toward homeowners and small businesses. But it also comes as Republicans press Obama to end the rescue program and use bank repayments to reduce the national debt

The trouble with this is that once you accept the Devil's coin, you have to dance to the Devil's tune.

BofA is a prime lesson in the problems with that.


[Hat Tip RealWest @ the Corresponce Committee]

Feds threaten to "fire" BofA Execs for balking at a bad deal.

The Washington Times reports on the strange dealings of the BofA/Merrill Lynch deal of 2008. There is something very rotten at the core of all of this.

Bank of America's acquisition of Merrill Lynch - and the government's role in the deal - are the subject of a hearing Thursday before the House Committee on Oversight and Government Reform. Bank of America executives said they were told their top brass would be fired if they attempted to renegotiate their bid for Merrill by declaring what's known as a "material adverse change" (MAC) - a clause in their acquisition agreement that would allow them to walk away or renegotiate the price in light of Merrill's mounting losses.

"The Treasury and the Fed strongly stated that if we were to invoke the MAC clause and fail to close this transaction, they would remove the board and management due to the risk we would create in the system," according to draft talking points prepared by company attorneys for Mr. Lewis ahead of a Dec. 22, 2008, board meeting.

(Emphisis mine)

How does the Fed come to have the authority to fire the board and management of a private company?

If they can do this to BofA, who could resist them? (Calling Lord Acton . . .)


~~~

And remember, where you have a concentration of power in a few hands, all too frequently men with the mentality of gangsters get control. History has proven that.
- Lord Acton