Life of Steve

De-leveraging: A positive economic sign

In the past most Americans took on record levels of debt due to certain economic bubbles. Two come to mind. The first bubble I'll mention was the internet stocks bubble back in the late 90's to early 2000's. Lots of people bought or were given shares/options of these stocks and borrowed against the value to buy things they wanted. This turned to massive debt when the stocks crashed and the loans got called in and those people were wiped out.

The housing bubble encouraged people to speculate with real estate. The regulated part of the housing market (Fannie Mae & Freddie Mac) loosened standards as to which loans could be sold to the entities that were backed by the federal government. In addition to buying houses that people could not afford many people actually took on even greater debt by taking on additional loans (debt) against their houses' increasing values. Then the housing bubble crashed and the value of these assets crashed spawning the credit crisis that is stagnating today.

Leaving the politics out of it we do see a cycle that repeats itself. Americans tend to load up on debt until it is no longer sustainable and then they get wiped out. Then they start all over again.

Things seem to be changing now which is a very positive sign. Having been burned enough times by such high debts we are starting to see the savings rate start to increase and Americans are wisely trying to lower their debt obligations so they can live within their means and also have less exposure to financial problems driven by an ever weakening economy and rising unemployment. Ex: Lower expenses means being able to survive on a smaller paycheck for a while until the economy improves.

This is the sort of change that tends to cause newspaper and nightly news shows to write headlines like: "Consumer is on a Spending Strike." Americans are spending less because that is what they can afford to do until the debt mountain is addressed. This is a good thing not a bad thing. It shows that people are starting to act like responsible adults and not spoiled children when it comes to personal finance.

Some short term pain from retailers is to be expected but this will set the stage for long term sustainable growth as the personal balance sheets for individuals improve which will foster financial/economic confidence based on reality.

MJ Death News Blackout

Did anything else happen in the world other than the back to back coverage of this?

More importantly, am I really that much of a terrible person for being completely apathetic about his passing?

Sorry, but it's difficult for me to make a (false) case that this affected my life. His music was ok I suppose back in the 80's but has anyone really cared in the last 20 years or so about this freak?  (Shrug)

America USED to stand for Freedom and the Rule of Law

Both within and outside of our borders. Not anymore.

Two recent events have made this very clear. The Iran situation (which I already blogged about) showed (and continues to show) that this administration simply doesn't care about the vicious violent repression that was waged against the legitimate freedom of expression by the people of Iran. Obama has made it clear that he is afraid of losing popularity with the Iranian Regime and won't provide any real support to the people who are demonstrating for freedom. Message from Obama: You are on your own. Good luck!

The second (and more recent) event is even more disturbing. In Honduras recently the (now former) President decided to unlawfully and in violation of the country's Constitution decided to try for power grab to enable him to continue to be President after his legal term was over. In a very Hugo Chavez type move he tried to grab this power unlawfully and was found to be performing this illegal action by the Supreme Court. (WOW! Imagine if the Supreme Court of THIS country would stop OUR President from violating the Constitution. Sadly, now I admire the Supreme Court of Honduras far more than the Supreme Court of the US.) Since the former leftist President refused to comply with the law they threw him out and flew him to Costa Rica. You would expect the mostly leftist leaders in Central America to ignore the rule of law and insist that this law-breaking power hungry former President would act like the petty dictators that they (mostly) are but the truly disappointing part of the story is to see the likes of Hillary Clinton and President Barack Obama siding with the likes of Hugo Chavez vs. the Rule of Law of Honduras.

Could they have impeached and arrested this man instead of kicking him out of the country? Perhaps. However, his actions appeared to be targeted to overthrow the entire government through an uprising vs. following the legal and peaceful path to modify the laws. They didn't do him harm (which is commendable) and he won't be able to cause as much trouble from outside the country as he would be able to from within. It's difficult to fault them for this.

The remaining question is why would Obama support another leader who is willing to ignore the laws and Constitution of his country in order to push a leftist agenda? Hmmmm. I'll let you be the judge. 

No Justice (No Peace?)

Let me get this straight.

Michael Jackson, Farah Fawcett, and Ed McMahon are all dead.

Keith Olbermann is fine and all we can manage for Perez Hilton is a much deserved and well overdue beating?

Life really isn't fair.

Iran violently crushes protests- Obama responds with ice cream snack run

Iran had a farce of an election recently and when it became clear the election was rigged the people who crave freedom revolted. Of course since there is no freedom of expression (or really freedom of any kind) in Iran the protests are being crushed with violence and bloodshed.

Obama had this to say: "Can I get both containers of ice cream?"

Just kidding! Obama actually said this:

"I strongly condemn these unjust actions, and I join with the American people in mourning each and every innocent life that is lost," he said. "But we must also bear witness to the courage and dignity of the Iranian people, and to a remarkable opening within Iranian society."

Another great speech by the President (Aren't they all? He is just soooo dreamy!) I wonder if his words will make any difference. Watching injustice (bearing witness) and repression and preventing it are two very different things.

In the Pre-Obama USA such words usually came with some kind of credibility that made such nations at least think twice about what they were doing. Ask the citizens of Kuwait, Iraq, and Afghanistan if you need further opinions or evidence.

Today our foreign policy is a big joke in the rest of the world. Russia told Obama to buzz off with his latest nuke treaty idea. North Korea is launching missiles hoping to hit Hawaii. While Obama is extending his open hand to shake the bloody ones of all the repressive dictators in the world why should they take anything he says seriously? Why would they bother dealing with Obama when they know he is either too weak or too worried about his public appearance to do anything to back up his statements?

The world is becoming a much more dangerous place. While I am concerned about the repression and bloodshed of the citizens in countries like Iran, North Korea, etc I am even more worried about the safety of Americans who are being put in even greater danger by the ignorant and reckless naivete of the Obama Administration's joke of a foreign policy. It remains to be seen if the current sad and increasingly dangerous situation will continue. Mr Obama when nuclear capable countries threaten the lives of Americans don't you think it might be time to DO SOMETHING? How about for the first time ever we might have an actual plan with actions to match the dangerous possibilities? (No viable plan for Gitmo. No Viable plan to pay for the stimulus spending. No Viable plan to pay for health care. Can we get some realistic plans for ANY of your ideas Mr. Obama? ) This is different than our economic problems where you can build a skate park and cook up some bogus job saved numbers. Real lives are at stake and it is quite literally a matter of life or death. Even the Pro-Obama press won't be able to cover up the bloodbath if Obama doesn't deal with these countries soon and they strike against us. It's not a question of being popular Mr Obama. Given the choice of being alive or popular I choose alive. I hope you choose the same. 

Will it be more than just words Mr. Obama? We shall see. 

Tub of Cookie Dough Story

This story is true. I am not making it up. This is actually a true story.

So I am sitting at my computer this morning just having eaten a spoonful of yummy Nestle Cookie dough from a tub we bought at Costco the other week (Ok. So *I* bought at Costco the other week. I absoultely love raw cookie dough. Quite simply it rules!) when I read this article on Yahoo.

Nestle recalls Toll House cookie dough products.

Um. What!!??

Good news is that no one has died from the E Coli. Yet. On the plus side. I feel fine. I am pretty sure that if I had: bloody diarrhea, & dehydration. I would probably notice.

Later on this afternoon I got an automated call from Costco informing me of the warning/recall and that I should not eat it. While I was impressed the call might have been a lot more useful prior to me eating multiple spoonfuls of the cookie dough.

It figures that the one time my willpower breaks down and I actually bought the cookie dough with every intention of eating it raw they recall the stuff.

Why is the Ethnic Background and/or sex of a Supreme Court Justice so important?

Can't help but notice a pattern here. Other than the belief that Abortion is in the Constitution (A topic for another time. Not today) nothing gets Liberals more excited than focusing completely on the Ethnic Background and Gender of a President, Supreme Court Justice, Mayor, School Board Member, etc.at the expense of any other qualifications, experience, or understanding of the actual job position.

I couldn't help but notice all the MSM reporters/cheerleader speculating about if Obama would pick a woman or minority to fill the Supreme Court Justice Spot as opposed to if he would pick someone who understands the Constitution and has the appropriate experience. Conservatives seem to be focused on who will do the job as it is defined in the "Rule of Law Book" (The Constitution.) Liberals are super interested in how they can use the Supreme Court to "get around" the Constitution and the Democratic process. (A little ironic don't you think?)

However the track record of this pick is very suspect. The Supreme Court is not where policy and laws are to be written. Given her views on how it is acceptable to use her position to actively (not lawfully) assist minorities with special treatment doesn't reflect a willingness to properly and passively interpret the law. This is a real shame that such bad picks create so many political issues around the one branch of government that should be apolitical. Even worse since I am sure there are many other very qualified judges who would do a great job and not try to effectively write laws and policy from the Supreme Court Bench.

Auto Workers Seizing the means of production

 Currently both GM and Chrysler are going through a Bankruptcy. Pre-packaged or through a court this is what is happening. After the Obama regime told us that this could not be allowed to happen it is occurring.

The fact of the matter is that the contracts that these powerful unions managed to wrangle out of the lousy managers decades ago ultimately broke the company when these entitlement legacy costs for pensions and insurance grew to unsustainable levels. After the powerful unions have looted these companies for decades to the point where they destroyed them there is nothing left. Obama, the unions powerful ally, utilizing his imperial Presidential power has given these companies Billions of taxpayer dollars so these companies could continue to pay off the looter employee unions but it didn't work for long. The money is gone and these companies cannot still meet their obligations.
 
So the plan that is pushed by Obama to maximize the benefits to his special interest group (The UAW) is to hand over the majority stake ownership of GM and Chrysler to the UAW and another very large stake to the Federal Government. Since we are currently in the age of a Democratic controlled government union ownership and Government ownership are effectively the same.

How great is it to be the UAW eh? You get to loot the company, then you get handed the company, and also get to be absolved from any responsibility of actually running the company despite being the majority owner! (Chairman of the Board.) UAW President Ron Gettelfinger has claimed that the union won't actually be running the companies. Of course not! Why would the UAW want to be responsible for actually running a company? It's much more fun to merely loot a business than try to actually manage a business, right?

So what is the endgame here? The UAW is unwilling and unable to actually run car companies profitably but Obama has made it clear that the UAW cannot fail. The most likely scenario is that these companies will become quasi government owned organizations with the remaining ownership. Therefore, it really doesn't matter anymore if these companies lose money indefinitely since they will clearly be propped up forever by taxpayer dollars to artificially protect the high UAW salaries that could not exist in a free privately owned manufacturing enterprise. (It is a fact not an opinion that the UAW salaries are higher than any other US based manufacturing operation.) In addition, the bondholders who loaned money to this companies who (according to the law) are supposed to be the first in line in a bankruptcy have been told by Obama (Obama doesn't need any stinkin' laws. He be the Prezident YO!) to go F themselves because we are giving everything to the Workers and taking the rest for the Federal Government.

Sort of makes you want to go out and start a company doesn't it? (NOT!)

April 15 Tax Protest Day

So there was a survey done recently that 60% of Americans are satisfied with the amount of taxes that they are paying. This sounds pretty good, right? However, when you look at IRS collection data that 50% of Americans pay somewhere between a negative number (Actually just get handed money for living here) and 4.06% tax rate. (Big Surprise! I would be happy to either pay negative taxes or under 5% taxes too!)

It appears that you have a group of people who are indifferent to taxes because they don't pay them on one side of the spectrum and a group of corporations with powerful lobbyists who get the lawmakers to write them loopholes to pay less taxes on the other side. This results in the regular middle class and small business owner to be forced to take on the bulk of the tax burden for the entire country.

These tax protests have been going on for many many years but I expect them to gain more and more momentum as the tax code becomes more complex and more punitive against a smaller group of middle class workers, professionals, and small business owners. In addition, the tax protesters agenda is not only about taxes but also about the truly historic and staggering amount of government spending and borrowing that heavily impacts American Prosperity.

Despite the efforts of many in the media to paint this effort as a Right-Wing fringe the many leaders of this grass roots organizing have taken special pains to tell Republican government officials that they are not welcome to come and speak at the events. They don't want a Republican majority if that means that we don't have true tax and fiscal reform. Good for them!

It's really is time for a fair flat tax to be implemented in this country especially in light of how extremely successful this has been in every country that has tried this. Curbing the excessive spending and everyone sharing the burden of raising money to run the essential government functions will lead to prosperity. We are starting to see words like "Revolution" being thrown around and maybe that is what it will take. I hope not. Hopefully the elites in Washington will get the message that "Business as Usual" and all the politics, class warfare, and special interests have no business being implemented via the tax code.

AIG Bonus Rage is valid but directed at the wrong target

Sorry to let the facts and the Constitution to get in the way of a good public lynching.

Here are the facts regarding the latest wave of AIG Bonuses:

-This was not a sneaky accident by the execs of AIG- This was deliberately written into law by Sen. Chris Dodd (who received over 100K in contributions from AIG Employees) that the Bonus contracts would be honored. "Dodd told CNN he agreed to change his amendment -- at the request of the Obama administration -- to ensure that previously enacted bonus contracts would be honored, despite billions of dollars that would go to bailout beneficiariess." This was written by the Democratic Law Maker and was passed into Law.

-In order to attempt to cover up the screw-up now the house is trying to pass a new tax/law that will effectively take back the bonuses that the previous law they wrote created. (Am I watching a 3 Stooges episode here?) Not only does this make the current leaders look really stupid but it actually violates the Constitution. These laws are called ex post facto ("after the fact"), and they are expressly prohibited by Article 1, Section 9 of United States Constitution: No bill of attainder or ex post facto Law shall be passed.

-You also cannot ignore the slippery slope argument. Setting a precedent that regardless of legality (Meaning that the transaction is perfectly legal) the pols can decide to levy punitive taxes to attack any particular group or individual who they don't happen to like for any reason (legal or not.) This remedy for the offensive bonuses granted by AIG with public funds (and for the record I absolutely agree that the bonuses do offend me personally. However, I would never have granted them a bailout in the first place.) is far scarier than the actual disease.

We are a nation of laws and you don't get to violate the law on the basis of some unpopular but legal action to take retribution on someone (or a group of people) you don't like for some reason. Someone needs to send Emperor Obama a copy of The Constitution. It's really worth reading. It tells you explictly what the government is NOT ALLOWED to do in order to protect the rights of the people. Sort of an important thing to know when you are the leader of the United States. I honestly just don't believe they know/care which is probably what scares me most of all. 

I believe the appropriate thing and morally correct thing would be for the AIG bonus recipients to return or donate the bonuses to charity. However, the illegal & unconstitutional actions taken by our government in order to cover up their bumbling should be where the real outrage should be directed. Today they will unlawfully seize the AIG Bonuses? Will your bonus, house, or salary be next?

The pols should tell us they screwed up and take the blame instead of attempting to redirect the blame and rage on to someone else to protect their own miserable careers. You screwed up. Own up to it and do better next time.

If there is a lesson to be learned it is this: The government is creating the messes, blaming others, then implementing laws that make bigger messes. How about they just decide not to screw things up in the first place? It would be a lot easier.