Archive for the 'economy' Category

Venture vs vulture capitalism.

Wednesday, January 11th, 2012

The recent debate of what constitutes good business pratices and the obligations of an employer is a best a misunderstood thing.

Governor Perry and Newt Gingrich both referenced Governor Romney’s experience at Bain Capital. The language used was not perhaps the best, and if we are honest, it may help Democrats in the general election.

Keep in mind, as I type this, I am a hard core Perry supporter.

The problem is that there is no context to what happens in corperate America - regardless of what type of free enterprise we are discussing. I know, Ive been there personally.

Companies are free to hire and fire who they like.

Companies are for the most part free to do business where ever they like without fear of unjust government hindering.

There are reasonable but important exceptions to these points including preventing child labor, firing people due to descrimination or running a business which dumps toxins into the environment - doing harm to people and the surrounding community.

Productive workers, who put in long hours to support their family, lose their jobs due to cuts made to give the share holders of the company an extra one or two percent of profit.

Leaders doing this may pat themselves in the back and high five each other by beating the quarterly estimate, but lets not mince words, such actions are morally wrong.

This is where the disconnect happens with many people within both the Republican and conservative heirarchy and grass roots level.

To be clear, the government has no right to intercede in such affairs. No law should be made to interject society into a private industry’s internal employment concerns.

Organizational leaders would do best to abide by the motto just because you can do something doesnt mean you should.

To be fair we must note there are cases where hiring decisions bloated organizations and in order to survive cuts must be made. In those instances it is a matter of life and death of the company.

This is what Governor Romney is referencing his experience in Bain Capital.

Some times a company is taken over, trimmed down and then can move forward and grow again. Job cutting is painful but necessary.

Private industry, unlike government, cannot just make up money out of thin air to pay for its services.

Of course that brings us to what matters in the hear and now. We are currently facing is a nanny state in which the government not only tells the business, even small ones, who they can fire and fire and where they can do business.  This is what we should be focusing on during this election cycle. To do other wise is fool hardy and plays into the narrative Democrats want to run on.

This is what we should be motivating us.

So what about new momentum for the declining dollar?

Friday, May 22nd, 2009

The Associated Press reported today that the dollar is declining because of worries regarding the trillions of dollars America is in debt for (and which will become worse in the forth coming future).

What about this? How does such a move impact your personal pocket book?

There are two direct ways we will feel the crunch: commodity prices (e.g. gas and food prices) and inflation. Both are not positive items for a healthy economy, but may very well be where we are headed.

For the Obama administration and Democrats, high gas prices might be the direction they want in order to force people in golf carts. For the rest of us it is damning at best by acting as a subversive tax increase and destroying billions in the all important disposable income category.

The same can be said with regards to the forthcoming inflation brought on by a low dollar and high deficit spending in which the government simply prints money. That inflation translates into lower buying power for the average American whether we are talking about a House, Car or simply putting food on the table.

The consequences will be brutal at best. At least until the government begins real financial responsibility and returns the power to people and the free market forces which made our nation the envy of the world.

Until then it will be rough going with no real end in sight.

If you do not believe me, one should check how and why European nations are running from what is being proposed in Congress as we speak.

In either event, the new momentum for the declining dollar spells bad things for us. I believe the best thing we can do is hope and pray for a stronger dollar and the return for common sense economics.

Kenysian or Marxist economics has never worked. This time is no different.

National Debt hits 11 trillion

Wednesday, March 18th, 2009

For those who believe President Obama and Democrats in Congress are some sort of God send and fiscally responsible, the Congressional Budget Office has some news for you - the United States is 11 trillion dollars in debt.

While presidents past (including George W. Bush) added to this deficit, none have accelerated it to the levels we now face - a whopping 13% of our Gross Domestic Product.

President Obama does not share this blame alone, however. Democrats who took control of Congress in 2006 and are current operate with nearly no checks in place to balance them are perhaps even more responsible.

Democrat sponsored legislation including the original TARP bill (which included almost two hundred billion more in spending in addition to a 20% kick back to organizations like ACORN), Stimulus/Porkulus (nearly a trillion) bill and the current budget over all budget (a proposed 3.4 trillion) all accelerated the slope we are currently hurdling down.

Whats worse, perhaps, are the various discussions we’ve heard regarding additional resources being spent because there isnt enough being done.

Is it no wonder its been recently reported that many countries are refusing the path of massive deficit spending which we are on?

Not to be left out is Republican opposition to particular provisions of the AIG bailout which were inserted by Senator Chris Dodd which allowed executives to pay themselves fat bonuses for a failing company.

Nor is the coming carbon based tax hike for everyone which Democrats in Congress are trying to rubber stamp with, save for eight “moderates”, with little or no debate.

Perhaps most perplexing to me is how these same Democrats who vote for these bills, such as Missouri Senate Claire McCaskill, to call them selves fiscal conservatives to which the media seemingly acts as nothing more than an echo chamber for.

But wait, one of the chief economist of Citi (yeah, the company who is begging for nationalization) is going to work for the Obama administration.

Who do they think they are kidding? My guess is that they and the media pat themselves on the back with a high rate of frequency, facts be damned.

The professor, a bucket, a student and a pool.

Wednesday, March 11th, 2009

Normally I dont repost chain email or press releases, but in this case the analogy regarding the stimulus bill (aka porkulus) is so telling that I felt it needed reprinting. Keep in mind this is a fictional story, but states many truths.

Shortly after class, an economics student approaches his economics professor and says,

“I don’t understand this stimulus bill. Can you explain it to me?”

The professor replied, “I don’t have any time to explain it at my office, but if you come over to my house on Saturday and help me with my weekend project, I’ll be glad to explain it to you.” The student agreed.

At the agreed-upon time, the student showed up at the professor’s house. The professor stated that the weekend project involved his backyard pool.

They both went out back to the pool, and the professor handed the student a bucket. Demonstrating with his own bucket, the professor said, “First, go over to the deep end, and fill your bucket with as much water as you can.” The student did as he was instructed.

The professor then continued, “Follow me over to the shallow end, and then dump all the water from your bucket into it.” The student was naturally confused, but did as he was told.

The professor then explained they were going to do this many more times, and began walking back to the deep end of the pool.

The confused student asked, “Excuse me, but why are we doing this?”

The professor matter-of-factly stated that he was trying to make the shallow end much deeper.

The student didn’t think the economics professor was serious, but figured that he would find out the real story soon enough.

However, after the 6th trip between the shallow end and the deep end, the student began to become worried that his economics professor had gone mad. The student finally replied, “All we’re doing is wasting valuable time and effort on unproductive pursuits. Even worse, when this process is all over, everything will be at the same level it was before, so all you’ll really have accomplished is the destruction of what could have been truly productive action!”

The professor put down his bucket and replied with a smile, “Congratulations. You now understand the stimulus bill.”

Roy Blunt right on Obama economics

Wednesday, March 4th, 2009

Roy Blunt got to comment yesterday on the Fox Business network and debated issues ranging from the current economic situation to government provided health care. I highly advise people to watching this exchange. Lots of substance.

Is there any wonder Robin Carnahan refuses to meet Congressman Blunt at any type of discussion forum?

Congressman Frank: TARP’s comp curbs could be extended to all businesses

Friday, February 6th, 2009

You read that correctly.

House Financial Services Committee Chairman Barney Frank is reported as saying that restrictions on executive pay “would apply to all financial institutions and might be extended to include all U.S. Companies.”

If you believe this is limited to solely Congressman Frank, think again.

Financial weekly says that Frank and the Obama administration “seem to be in synch” when it comes to plans for executive compensation.

In fact, it states that  newly minted Treasury Secretary Geithner mentioned last month he would consider “extending at least osme of the TARP provisions and features of the $500,00.00 cap to U.S. Companies generally.”

Would some one mind telling me what gives them the right or the authority? Certainly not the Constitution or Bill of Rights. Both spell out that government has no business in such matters.

I warned people both locally and abroad what would happen and much of it was chalked up as political hyperbole.

Hate to say it, but I was right. The question is what can we do to stop the march not just to socialism - but to an indirect form of communism.

Reax to a few polls produced recently…

Friday, January 16th, 2009

Rasmussen Reports: Most Americans Say Leaders Clueless On The Economy - 58% of Americans lack confidence in their leaders on the economic crisis. I would agree with this whole heartedly.

I run a small business and I always hate seeing a chunk of my hard earned money getting sucked into oblvion, or in this case, into the hands of bigger businesses which are deamed worthy of saving. Suffice to say I best leave it that I personally believe many of our political leaders would fail at understanding (or have forgotten) how a capitalistic society works.

Fox News: 80 percent believe debt is ruining the economy. Additionally, 50% of the people surveyed believe the stimulus packages as presented makes the country feel as if it is drifting toward socialism. You think? Then why did you vote into office someone who’s economic team and personal belief is that we need to spend our way out of the recession and “spread the wealth.”

The Carnahan rules all poll.. Outside of giving Democrat hacks in the media something to create news about it means nothing. Especially this far out and with Obama recieving a low sixties approval rating.

I would note, though, that Blunt burn out could be a real factor. How much of one, I dont know.

Another unknown will be how much Roy, if he were to run, would get scortched by the media. Similarly, how much of a free ride would Robin Carnahan get? If the past two state wide elections are any clue, she might as well be sending pay checks to the Post-Dispatch, KC Star and KY3 down here.

Senator Dick Durbin gets it, sorta.

Sunday, January 11th, 2009

Senator Durbin of Illinois apparently admitted that mailing billions of dollars to Americans last year in an effort to “stimulate” the economy failed.

Once we are past the “master of the obvious” moment for the thought, I would like to commend him on pointing out that targeted tax cuts might be a part of the answer.

When given a single time check most of us will either sock it away in savings or try to pay down credit cards. Both are helpful but do not help get people to spend more money.

However, if we give them more of their weekly/monthly/what ever pay check - that turns into actual fiscal stimulus. My guess is based on personal experience is that he is correct.

Of course dont tell Pelosi or the hard left in the House of Representatives who want to actually raise taxes. Durbin has a reputation to maintain.

RE: Obama stimulus “plan”

Saturday, January 10th, 2009

Just a couple of late night notes here regarding the Obama stimulus “plan” and the various reactions to it.

Simply put, there is no plan. At least we are not seeing a lot of details, just broad strokes with more of the same “hope, faith, change” rhetoric.

Whats more, dont be fooled by Democrats in the House of Representatives and Senate trying to talk the plan down because of the miniscule (and vaguely defined) tax cuts found within the plan. It is nothing more than a case of good cop, bad cop with the hopes that Americans will think Obama is the good guy.

Never mind the excessive spending and overly generalized details with a lack of accountability and transparency.

If Obama were trying to truly trying to provide a balanced plan we would see not only more details, but an emphasis on allowing small businesses to survive.

Instead, we are looking several bills which may very well kill them - including the advancement of the Orwellian named ”Employee Free Choice Act” which removes provisions which secure and individual’s right to secret ballot when forming a union.

Just keep in mind something folks. Some Republicans gave their buddies wet kisses in the late nineties and early 2000s when they were in charge. Democrats are following the same suit, except they are now taking away individual rights and hide the pork in an effort to give their supporters a “stimulus” package of their own.

Question of the morning…

Friday, January 9th, 2009

With unemployment at 7.2% this morning and employers cutting jobs left and right, how wise does it look to have forced a raise in the minimum wage with no cap? Hm?

If I lost my job and wanted to start my own business or simply wanted to hire someone for extra help where would those new regulations benefit me?

How many of those job losses might be due to employers letting lose employees who might be up for mandatory wage hikes forced by such regulations.

I dont know for sure, but I’m just sayin’…