Posts Tagged ‘Recovery’

Presidential Worth To Americans

In Political Buzz on 05/16/2009 at 4:30 pm

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We Threw Our Economy Away

In Home Buzz, Money Buzz, Political Buzz on 05/06/2009 at 8:05 pm

Somewhere along the way in the last 25 years or so, America changed and started throwing the economy away along with our future. We produced little but consumed voraciously. We have become complacent and lazy asking not what can we do for our country, but what can we do for ourselves.

Think about this, we have become a disposable society. We have very little of value on average. Very little of REAL MONETARY VALUE! Clamoring for cheaper and cheaper quality has all but disappeared as mfrs. shift to meet demand. So we have furniture, electronics, cars and clothing that are not made to last. In years past, your used TV or Sofa or Clothing was worth a lot more than it is today. In fact, back then what you paid for it used, you now can buy it new for today in many cases. Corners are cut everywhere to lower costs. It’s not going to last for years. Part of it is panned death so mfrs. can sell more product, but mostly it is us. We got exactly what we wanted.

For the past generation or two, we have spent and spent AND spent on electronics, clothes, shoes, TV’s, cars, etc… It breaks we throw it away and buy another one. We have NO assets in our households on average that have any type residual value. Used vcr? $10, used dvd? $20, used TV? $100-$300. Used sofa? $50 Used dining table? 125 maybe.

 We have spent 4, 5 or 6 times on the SAME THING in the past couple decades. A LARGE part of that money WENT OVERSEAS! So we took OUR jobs and threw them away. Then we bought cheap goods over and over and threw the money away every time we threw that thing away that broke or wore out and got a new one. We have consumed ourselves into this depression this time.

We spent our money, have nothing to show for it and just threw it all away on nothing but living good. When things get rough, we have to tighten but there is nothing to tighten so then what? We crash is what and that is what has happened. Not only did we cut our throats on the manufacturing and consumer end, we became a service economy but we all but eradicated that ourselves.

Throw it away, don’t fix it and you put all the service businesses out of business. It’s not the “Lonely Maytag Man” because of high quality. It’s the BANKRUPT repair man because of poor quality and no work! It costs $149 to fix a camera you can buy new for $189! It costs $1,800 to replace the flat panel display on that TV on your wall but the TV only costs $1,699 to buy it new! Bookshelves cost $255 to repair when you broke it apart moving, BUT you only paid $85 for it at Ikea!

We threw our economy away. We spent all our money on hollow assets that don’t last and were just expenses. Now that it’s broke, we can’t fix it because it costs too much to fix. But we also can’t buy a new one becasue WE are broke. That leaves the factories unable to sell anything. Then the moneygrubbers, er uh brokers, found a way to make more money with paper. Another hollow asset!

Well just like our consumer goods in durables that AREN’T durable crashed, so too did the markets right along with mfrg. Why do you think you still had your parents AND grandparents furniture for so many years AFTER they had it? Why did your parents keep that B&W or Sepia TV for 5 years AFTER color TV’s came out? Because they WORKED! They had 78’s and record players played all THREE speeds for decades because the RECORDS LASTED!

Why did mom iron on those patches in the knees or our jeans or stitch the seams? Because the rest of them were still new! Why did we have shoe repair places around almost every neighborhood? Because the shoes were great and it was less than 1/4 the cost to resole or repair and the rest of the shoe was in GREAT condition. No need to throw them out.

But for the past 20 years, we spent and spent AND spent but buying and rebuying the same things. It took BOTH parents working to keep up. Pay the bills, eat, and keep buying. Our “durables” were consumables. Washing Machines that used to last 20 years we had to buy every 2 or 3 years. Dishwashers that lasted 10 years (even though it was horrid green or yellow on the outside) worked great on the inside but today’s models start to go between 1-2 years.  Extended warranty’s on so many small electronics are half the cost or more of buying a new one.

Mom had the iron that she got from Grandma and it had STEAM too! You may not even own an iron but if you do I’ll bet it’s your 4th one! In the past 10 years I know I have gone through at LEAST a dozen assorted types of food processors.  None worked right or as intended and none lasted more than a year.  I remember the one mom had.  She had ONE and lasted 4 years until I moved out, it was still in the kitchen cabinet. 

We used to save up and buy quality. We would get a loan to pay for big purchases. The washer and dryer, or the sofa, or the TV, even the car! ALL of them would be paid for LONG before they became useless. ALL of them were repairable at reasonable prices. No longer today. Sure, we still finance all our “big purchases” like these. The problem is we are paying 3 years to 5 years for things that break, die and are replaced before the darned thing is paid off! Nothing like making payments on something you don’t have anymore AND making payments on the new one you bought to replace it!

We threw it away, ALL of it! We need to return to quality of yesterday regardless that it costs more. Factories need to plan and work their production according to what is NEEDED and can be sold rather than build it and try to sell as may as possible. Find the need and DELIVER IT! Let the big money brokers lenders and financial markets crash! Let them go bust.

It was stupid for us to spend WAY over a TRILLION DOLLARS and AGAIN WE HAVE NOTHING FOR IT BUT DEBT!!!! (The total price all added is over a Trillion and we’re not done spending yet).   You take THAT cash, distribute it to ALL THE TAXPAYERS and they will buy from the companies that fill their needs. The factories will get new orders and the economy will flourish. Bankers, lenders and paper peddlers will get crushed. So what! Better to let them fail and belly up compared to all the citizens in America going belly up!

 WAKE THE FUCK UP AMERICA! Get our country out of the trash and stop throwing things away. WASH THOSE DISHES and stop buying paper plates. Tell them PAPER and to hell with plastic. Recycle the paper. We didn’t use many trash bags as kids. But we learned to empty our containers before throwing any away so as kids we didn’t have to carry out the nasty soggy tearing open brown garbage bag. Bring back the deposits on bottles AND cans! Some things we have today may be better but not really in the whole scheme of things. Hybrid cans may last long and be a little cheaper. But they last long and that costs more on the environment. Not only that, they are not recyclable.

Much better to see rusting cans at the dump than nice bright composites. At least you know it’s going back where it came from.  WE need to go back to where we came from.  Something is wrong when it’s cheaper WITH freight to get something from the other side of the world than it is to get it here.  Oh yeah, lets not get started on slave labor and govt. subsidized operations.  There is disparity sure.  These things have to be reviewed and worked on over time.  But for now, STOP THROWING OUR FUTURE AWAY!

BUY AMERICAN but BUY QUALITY!  I don’t mean quality of workmanship but the whole package including quality of materials and durability.  Don’t buy anymore “disposable” anything.  If it’s not going to last you 5 years, don’t buy it!  You know that a sofa that costs $399 at Rooms to Go is NOT going to last long.  Save the money and buy something that costs $1,200 and you know is going to last 5 times as long.  THAT is your value.  Buy a timeless style not a “fad.  Buy something that it is worth recovering 5 years down the road.  Spend that $800 to recover the good sofa.  Don’t spend $399 on a crap sofa and think you have $401 left to spend on “fun”.  It don’t work like that.  The sofa is gone a year later, the fun is gone the next day, you are out $800 and no sofa at all.  Of course this is an example but the pricing and comparisons percentage wise are accurate.  In fact, don’t buy ANY furniture at Rooms To Go!  Hang out at their warehouses, all the trucks are from overseas.  That is their crap coming in and our money going out.  STOP IT!  Don’t shop Ikea either!  Stop buying the cheap crap. 

Don’t buy it just because it says “Made In USA” either!  Buy it if it is good quality and built to last.  It should have a warranty on it that you shouldn’t have to play twister to get covered if you need it.  You should have to buy a warranty either.  Those warranty services are mostly jokes when it comes to furniture.  Same with all the small electronics.  Those are nothing but profit centers for them.

LEARN AND STUDY, STUDY AND LEARN!  The internet is FULL of free expert guidance on just about anything!    Become informed, buy quality, buy it for an intended purpose and need.  Buy it for the expected life.

I don’t know HOW the hell we are going to get out of this mess we are in now.  WE threw it all away.  NOW we let politicians take over, rule and throw it all away.  The American People are duped and just go with the flow.  Running on fumes and fear we are like sheep and quick to follow anything if we are told it’s ok.  Don’t be so damned gullible!  Read, study and learn all you need to in order to have a better tomorrow.  Otherwise you will have thrown away tomorrow too!

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Stimulus & Economy Snapshot 04/11/09

In Money Buzz, Political Buzz on 04/11/2009 at 1:07 pm

March Record Budget Deficit Over $192 Billion

The budget deficit shot up $192.3 billion in March nearing $1 trillion according to numbers released by the Treasury.  We’re only halfway through the budget year but the cost of Stimulus, Bailouts and the Recession (Depression) soar.  The deficit shot up over $42 Billion more than expected say economists.  The deficit soared over $42 Billion more than leading economists expected.  It’s already over $956 Billion the first six months of the budget period which is also in record territory.  Obama’s people project a deficit topping $1.75 trillion by the end of the budget year. (About 4 times the record deficit of the previous budget year)

Nearly $300 billion went to the nation’s banks and other companies to deal with the financial disaster.  But millions of homeowners still lost their homes!  Where the hell did the money go and for what purpose?  It didn’t pay off these loans and let people keep their homes that’s for sure.  Wells Fargo reported a tremendous profit for the first quarter this year.  They also received billions in cash from the bailout.  So the money went to save the bank, the investors, the note holders and the instrument writers and guarantors.  The homeowners lost their home, the bank holds the hard assest and sells it for the cash, the bank has the money from the Fed to replace that which it was losing due to default, but the property is taken over, the loss was on paper and the only one losing is the homeowner.  The bankers have cash in BOTH fists!  One from the Fed and the other from the assets it took and sold.  Some one is getting screwed and it’s not the financial moguls that caused the problems and have their hands out.  It’s the Homeowner and the American Taxpayer.  How else can you explain a bank that goes from the verge of bankruptcy and losing billions of dollars to a total turn around and billions in PROFIT in just a few short months?

In addition to all that in the bailout fund, another $46 Billion was pumped into Fannie Mae and Freddie Mac last month.  So far about $60 billion since October has been injected into these agencies.  I say agencies because they were both taken over by the government late last year after they had combined losses in the billions of dollars on mortgage loans.  So somehow the private sector bank can turn around into a profit in a few months but the fed is still running at a loss with it’s own lending agencies?  Something smells here.

In all over $700 billion of bailout funds Congress approved has disappeared into corporate coffers.  Primarily to banks, although insurance giant American International Group Inc. and auto companies General Motors Corp. and Chrysler LLC also have received assistance.  Funds also were and are being dispersed to states for billions of dollars for all the “approved” programs.  Some went to the public to be realized mostly through this year and off into next year in tiny drops for the average American Budget. 


Still In A Classic Depression Economy 

Take a look around!  People are STILL losing their jobs and homes.  Businesses are still closing up and cutting back.  Unemployment is still climbing as well.  Growth is reversed and production is way down as is consumption.  Yet prices are not declining much, in some cases they are climbing.  While consumers have MUCH less on average to spend today, the cost of living has not dropped creating a larger gap than before.  Credit would be utilized to fill in the gap until things could equalize.  But there is very little credit available.  Many consumers have had credit lines reduced or cut off entirely so now there is nothing to help fill the gap to get through this fiasco.  Recessionary times with inflationary markets, choked off money supply, asset base depletion all this is pointing to depression. 

The fed is creating a potential huge monster bubble in the US dollar.  Borrowing now, underwriting the economy but getting very little ROI and revenues are shrinking.  Tax revenues totaled $989.8 billion which is down 13.6 percent from a year-ago same period.  Since World War II this is the longest “recessionary period” every recorded.  The downturn began in December 2007 according to some pundits.  According to my writings I first noticed a “downtrend” in the fall of 2007 around September/October.


Some Bailout Money Trickles Through To The Public

At least some of the billions from the stimulus plan is finding it’s way to the general public where it’s needed.  While the numbers seem high, for the teeming masses it is meant to serve, it is a literal drop in the bucket.  Medicaid, Medicare, Unemployment Benefits and Food Stamps are ways the fed is getting it down to the people along with some tax breaks. 

The Treasury also reported benefit payments from the unemployment trust fund totaled $44.6 billion so far this budget year which is up from $19.4 billion last year.  However, it should be noted that this isn’t a lot of new money from the stimulus plan going to the people at all.  The majority of it is coming out of the unemployment trust fund which was already in existence and heavily funded by employer contributions (payments by the employer) to the fund. 


Obama’s False Claims

Just a couple months ago Obama put forth his budget proposals and told the American public we would have a $7 Trillion deficit over the next 10 years.  Yes, you read that right, TRILLION! 

However, last month, only a month after Obama’s budget proposals were put out, the Congressional Budget Office estimated that Obama’s budget proposals would produce $9.3 trillion in deficits over the next decade.  This is $2.3 trillion MORE than Obama said it would cost.  The CBO said Obama’s budget will cause deficits around $1 trillion annually through to the end of the year in 2019.

The administration still says it is confident its claims are accurate and the presumed declining deficits over that same period could be achieved.   The thought is nice, but that is exactly opposite of what is happening and has happened in the past.  Private economists feel those claims are false due to the fact that those estimates are relying on faulty economic assumptions believed to be too optimistic.


Expect War

While it has been typically a Republican tool, the Dems are going to have no choice.  For all his peace spouting propaganda and trying to get in bed with the muslim world, Barack is going to have to adjust his thinking and his actions to real world facts.

War generally follows economic turmoil and a period of prosperity follows caused in part by the war machine economics then in the rebuild post war feel good and happy economy.  Bush AND his daddy screwed that up.  Not realizing how far reaching and long lasting a war has to be to recieve the same historic stimulus and economic boon of prior wars they fell far short of requirements with the Iraq campaigns.  Desert Storm and Desert Shield both fell short of completing and worthwhile goals.  The current effort was a waste of Amercian Life and resources and did nothing in the grand scheme of things.  The first Bush attempt was the most succesful but in the wake of the event the combination of cutting it short and then stepping in too fast too much in inflationary moves which was continued through into Juniors years just messed up the economy.

Things were moving forward and they kept killing the goose toying with numbers and supply until the economy became confused, wary and just gave up deciding to stagnate then crash in the end.  The government is now stepping in trying to shore up the collapse and stabilize it to grow.  But the fools are already talking about raising rates and we are not even in the first stage of recovery yet still seeing declines across the board.

To take focus off of internal screw ups the administration will have to shift focus.  It’s already taking protective steps and shifting focus saying they have nothing to do with todays problems, they are just trying to fix it.  That isn’t going to work.  Obama SHOULD know that the only way the economy is going to turn get attention off of his office is to get the people behind him in some thing and to be looking elsewhere. 

A war will create jobs, increase production, free up the money supply and stimulate a lot of action and movement.  Industry will vastly increase over it’s near standstill level and consumers will again be able to consume.  When the war is over and “Johnny/Jenny Comes Marching Home Again” it will be hurrah time.  Families reunite, new ones start, baby boom, more work, more services, more money, etc…

But in reality, for it to work, it has to be a sizable war of real duration.  It can’t be some “Storm Trooper Operation” police action quick snatch and grab go in , destroy, leave.  Nor can it be some ill conceived plan without a clear goal and become drawn out over time without any discernible benefit or goal being accomplished either.

Afghanistan, Iran, Iraq, these postage stamp pipsqueak events aren’t going to do the trick.  There is a lot of saber rattling going on over the Korean arena….

Not that I condone war or hope it would occur mind you.  It’s just that it is what politicians think they have to turn to in order to take care of their problems.  The real truth is if they honored their promises to the people and if they did the right things and spent money the way it should be, if they let the money-changer robber-barons belly up and put the Billions of Dollars direct to the people, if they told the banks they would give them the money to bail them out but they also have to apply that money to the defaulted homes of homesteaded homeowners, if the public got the money in their hands, THEN you can have your turn around and post tragedy economic boon without going to war as the motivating tragedy.

But we’re dealing with politicians and a would-be despot, a wanna-be king that are power hungry power monger control freaks.  I don’t really expect them to do the right thing to fix the nation and the economy, to save American Jobs and Homes.  Nope, I don’ expect that will occur, I expect war.


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Stimulus & Economy Snapshot 04/09/09

In Money Buzz on 04/09/2009 at 9:23 am

Jobless Claims Are Down, no wait they’re UP!

Well it depends on what numbers you are looking at and how you word it.  But a person can make numbers do just about anything to tell a story and sell whatever they want to sell.  Take a look at today’snews articles with opposite headlines about the Jobless rates.  One claims “Continuing Jobless Claims Climb To Record 5.84 Million” while another reports “New Jobless Claims Fall More Than Expected To 654K”. 

Ok, so which is it”?  Is jobless rate up or down?  Well one thing to keep in mind is that these numbers are always “seasonally adjusted”.  So numbers are never telling the “real” story.   Fact of the matter is unemployment is at a record high and not on it’s way down anytime soon.

Record Unemployment Is The Real Story

The “total” number of laid-off Americans rose to 5.84 million, that is those receiving unemployment.  It was standing at 5.75 million.  This is the most it has been on records dating from 1967 plus it is much higher than analysts expected.

With so many people on un-employment and the massive layoffs and company closings the past 12 months it stands to reason that “NEW” claims filed for unemployment would drop off.  New jobless claims are down to an adjusted 654,000, it fell from the previous week of a seasonally adjusted 674,000 . 

So this is the “glass is still half full” thinking.  New jobless claims are dropping YAY!  It sounds nice doesn’t it?  Except the harsh reality is that almost 3 million Americans will lose their jobs over the next month time span (4.33 weeks).   This will keep the “continuing unemployment” rate climbing even while “new jobless” claims fall.  We can only so much further as a nation before grinding to a halt. 

Jobs Taken From Americans, Assets Handed Over To Foreigners

What the numbers clearly show with the high level of continuing claims is that those unemployed workers aren’t able to find new jobs.  I wrote abo0ut this months ago too concerning the ancillary fall out of the auto industry devastation.  King Obama is showing his ignorance about big business and needs to get out of corporate America.  The auto industry woes and continued forced cuts, layoffs and closings to appease the King is a driving factor in layoffs in the auto and all manufacturing related industries.   It also is one of the big reasons no one can find a job and stay on unemployment because the jobs were eliminated.  Kentucky had the largest jump in new claims followed by Michigan, Illinois, Ohio and Tennessee reporting the next largest increases.

While I agree we can’t just throw money into Auto Industry without getting safeguards in place, forcing accountability and seeking better results from that sector.  We still have to back OUR people on OUR soil!  Fund Chrysler to keep it American not get a foreign entity into it.  AIG got the biggest benefit and they are global so a vast amount of US funds benefited foreign entities in that deal AND IT’S STILL SUCKLING AWAY asking for, and receiving, more money!

All this does it take jobs and American Assets away and hands it over to foreign entities.  It doesn’t help America or it’s future by carving up slices of the pie and giving it to others.  Later when the pie is gone, we will starve.  It’s going to come back and haunt us in the future.

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More On Their Way To Jobless Status

Along with other gloomy news prospects announced this week, newspaper publisher A.H. Belo Corp., which owns the Dallas Morning News, will eliminate 500 positions.  This equates to roughly 14 percent of its entire labor force.   Ancillary losses still bleeding out from the auto industry crash continue with Goodyear Tire & Rubber cutting another 5,000 jobs.  That is roughly, 7 percent of its remaining employees that will be gone this year.   

More Stimulus Money & Jobs To Foreigners

What is really shocking is that Heavy Equipment maker Deere & Co. will lay off 160 employees later this month at its plant near Des Moines, Iowa.  They said it is due to reduced demand.  The stimulus package was designed to increase demand by funding large scale public works project.  So something is off here.  Either that or buyers are going overseas to Kubota or comparable.  So once again, Stimulus money is going to foreigners, Americans pay and get screwed out of money AND jobs.  They need to plug this leak ASAP!  Stimulus money is to be spent in America on American Goods and Services and hiring of Americans.  When will we learn?


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Stimulus & Economy Snapshot 04/06/09

In Money Buzz, Political Buzz on 04/06/2009 at 4:30 pm

Morgtage Bailout Scams

The FTC recently sent warning notices to 71 companies running suspicious advertisements. The agency also filed three new complaints against Northridge, Calif.-based Federal Loan ModificationLaw Center LLP, Newport Beach, Calif.-based, and Clearwater, Fla.-based Home Assure LLC, and the operators of those companies.

These companies are misleading the public from the start beginningwiththe name of their outfit.  There are hundreds of officialsounding companies that are using words from current news and official government programs to mislead the public.  Just like the old “free grant money” scams that offer to sell you information about real government grants.  They now are selling you “Stimulus Grants” and it is the same old false hype.  Information about legitimate grants is available for free so you are paying for a cover letter and semi-sorted search results plus a lot of useless fluff. 

The FederalTrade Commission filed cases against two other companies last month: Hope Now Modifications LLC and New Hope Modifications LLC.

According to various government officials, scams like these are taking advantage of desperate borrowers and those in danger of default or have already defaulted.  They do so by charging them upfront fees of $1,000 to $3,000 for help with loan modifications that rarely, if ever, pay off. 

While it is possible to renegotiate, modify and otherwise work out a deal to save your home, these scam outfits aren’t going to be doing it.  Bankruptcy is an option to buy time and reorganize to save a homesteaded home.  Depending on where you are it can range $1,500 and up for an attorney to do it plus costs.  That is a marketing ploy for a number of attorney’s right now.  They promote saving your home getting your information for court records when foreclosures are filed.  They present themselves as mortgage or loan specialists able to renegotiate, modify or otherwise save your home.  When you go and meet withthem it’s free initialconsultation.  They talk with you for 15 minutes and give you a prepared “info pack” from a nearby stack.  All about bankruptcy and they tell you  that is going to be your best option.   They don’t save your home through any programs or negotiation at all.  They handle your bankruptcy case for you.  While that is an option, it is not necessarily the best or only option you might have.

In related news, the FBI is investigating over 2,000 mortgage fraud cases said Attorney General Eric Holder.  This is  says the , a 400 percent increase from five years ago.  “If you discriminate against borrowers or prey on vulnerable homeowners with fraudulent mortgage schemes, we will find you, and we will punish you,” Holder said.


King Obama

Last week he told the major automakers he didn’t like their recovery plans.  He told GM and Chrysler specifically they might need to just file bankruptcy.  He wasn’t going to give them any bailout money unless they changed what they were doing and gave up more control of the company to the Fed.  The Fed also demanded GM’s Top man to step down and get out.

Who the HELL does he think he is?  He’s supposed to be president and head of our government.  He is acting like he IS the government and it’s HIS money he’s dishing out!  He has no power or authority to be making these statements and demands he is making.  That is up to lawmakers and the houses of government officials to do.  He is stepping nicely into the role of King and throwing off the shackles of Constitutional Government instead making his own rules as we go along.  To get the stimulus bills and programs passed there were a lot of secret negotiations and closed door meetings.  Most of the plans and programsthat have been rolled out have no voting on them by elected officials and no voter approval was given.  Most are privately drafted policies, rules, guidelines and programs that were given to the president for approval even though his approval wasn’t required.

He has no background in big business and needs to stay out of the corporate boardroom.  He really should stick to politics and helping the American People with plans and programs.  Forcing his will upon corporate America and wresting control of private industry away from the private sector by tying it up with money strings is going to have long term detrimental consequences for the entire world.

The administration will protect consumer warranties from General Motors and Chrysler vehicles and make sure parts are available to quell fears in consumers which could prevent them from purchasing a new auto.  So Obama is now going to be in the car repair biz?  They have NO way to back this up other than to either fund or take over a bankrupt company to make good on this promise.  Obama is also telling Chrysler to sell out to a foreign entity and then he will give them up to $6 Billion in aid.  If they don’t sell out, he is not putting any more money into the company.  WTF is that all about?  Sell off America to foreigners?

Barack Obama refused any more Fed bailouts for GM and Chrysler,  saying the companies needed to get more deals from the unions and the automakers creditors among others before any more money will be approved.  He did say that in bankruptcy if that is the way it goes they would look to speed up and expedite the process.  Wow, how nice to just take over the nation and LITERALLY take it over telling everyone how to run their business, their life, and in the case of government agencies and politicians,  how to think and what to approve or disprove.

He is essentially taking command of GM and telling Chrysler to merge with a foreign competitor or cease to exist.  As I posted in the past couple weeks, Obama is using economic conditions that are evidently dire enough to warrant a new level of government involvement in the management of corporate America on a level that has never before been even dreamed of let alone enacted upon.


King Obama’s New Declaration

King Obama is again abandoning the United States in favor of Muslims with his new declaration, the U.S. “is not and never will be at war with Islam,” amid other racially and ethnically charged comments during his meetings and speeches.

What planet has this this guy been on the past 20 years?  Iran, Iraq, Afghanistan come to mind in regards to being Islamic nations.  While Obama conceded there are still tensions over the Iraq war but said Muslims worldwide have little in common with terrorists such as al-Qaidaand have much to gain in opposing them.   Why is he bothering “politicking” these foreigners?  Half of Islam are fundamentalists and half of them (if not all) would like to destroy the USA if they could.  He also spoke of his own Muslim background once again stepping over the boundaries of a US president AND abandoning entirely the principles our nation was founded upon.

“We seek broader engagement based upon mutual interest and mutual respect,” Obama said in a speech to Turkey’s Parliament.  DUDE!  There is no WE!  It is YOU that is interested in joining up with Islam.  The rest of America wants the United States to remain the strong, independent world power it has always been.  ALL Americans that are true Americans want a constitutional government Of the people, By the people and FOR the people.

“Our partnership with the Muslim world is critical, not just in rolling back the violent ideologies that people of all faiths reject but also to strengthen opportunity for all its people,” he said.  He portrayed terrorist organizations like al-Qaida as extremists and not at all representative of majority of Muslims.  He must be blinded by his recent self crowning as king because that is simply a fallacy on his part.  It is also something that is seen right through by any muslim anywhere.  While the militants are a minority, the beliefs and thought processes are the same for the majority.

Why are we kissing up to this mongrel country?   Remember, Turkey barred U.S. forces from going through its country to attack Iraq and was vehemently opposed to our “invasion” of their air space.  They should be ignored and trod upon as they do with their own and how they ignore the needs and desires of the rest of the world so too should theirs be ignored.

 Obama further pumped their egos stating, “Turkey’s greatness lies in your ability to be at the center of things. This is not where East and West divide — this is where they come together”.

He further declared,   “I know that strain is shared in many places where the Muslim faith is practiced. So let me say this as clearly as I can: The United States is not and will never be at war with Islam.”  No, just a host of Islamic countries and organizations.


USA not the USI

Obama pronounced his own heritage: “The United States has been enriched by Muslim Americans.  Many other Americans have Muslims in their family, or have lived in a Muslim-majority country.  I know, because I am one of them.”  Obama’s Kenyan father and grandfather were Muslims, and he spent time as a child in Indonesia, the country with the world’s largest Muslim population.

There was a strong hearty ovation near the end of his speech when Obama said the U.S. supports the Turkish government’s battle against the Kurdish rebel groupPKK.  Boththe USA and Turkey consider them a terrorist group.  Of course he got a rousing ovation when he said America was not at war with Islam.

Turkey is a member of both the G-20 and NATOand is trying to get into the EU with the help of the U.S.  Instead of trying to get in bed with the muslims in this Isalmic country he should USE this fact and leverage it to OUR advantage as a bargaining chip.  They NEED us, we don’t need them.  OUR advantage as in the UNITED STATES OF AMERICA, not the kingdom of Obama Hussein and the USI (United States of Islam).

Obama stongly supports the Turkish bid for membership in the EU.  He reiterated it this past Sunday at the meeting in Prague by the G-20.  In so doing he has raised the ire  of many long time USA allies, epecially France and Germany, which rightly point out that America has no say in the matter.  Back-pedalling quickly, Obama conceded the point saying he waonly speaking “as a friend” of both Europe and Turkey.

“Turkey is bound to Europe by more than bridges over the Bosporus.  Centuries of shared history, culture and commerce bring you together,” he said. “And Turkish membership would broaden and strengthen Europe’s foundation once more.”  Maybe he forgot the pivotal roles Turkey had in the crusades, the dark ages, World War I, World War II the support of terrorist groups and countries so long as it didn’t consider them terrorists or enemies against them.  Though Obama held to his 2008 statements that Ottoman Turks carried out widespread killings of Armenians early in the 20th century, he stopped short of repeating the word “genocide” that he has used in the past.  While not a reversal it is clearly another back-pedalling maneuverto foster a union with the muslim country.  “Well, my views are on the record and I have not changed views,” was all Obama said.

It’s officially estimated that up to 1.5 million Armenians were killed by Ottoman Turks in the years prior to and into World War I which is an event viewed by many scholars as the first genocide of the 20th century.  Turkey don’t deny the deaths but denies that the deaths constituted genocide.  Just like some claim the holocaust didn’t occur and the death count was inflated.  Turkey claims the toll has been inflated and the casualties were only victims of civil war and unrest.

Mingling during a dinner Monday night, Obama met privately with the foreign ministers of Turkey, Armenia and Switzerland, according to a senior White House official.   Obama commended their efforts to normalize Turkish-Armenian relations and further urged them to complete the talks “withdispatch,” the official said.  Publicly, in his speech to the Turkish Parliament — what used to bey the Turkish Grand National Assembly — Obama said, “History, unresolved, can be a heavy weight.  Each country must work through its past.  And reckoning with the past can help us seize a better future.”

“I say this as the president of a country that not too long ago made it hard for someone who looks like me to vote. But it is precisely that capacity to change that enriches our countries,” he said which clearly alluded to his heredity and the black race. 

In his news conference with Gul, Obama commented on the rift in U.S. and Turkish relations concerning Iraq.  “I do not think they ever deteriorated so far that we ceased to be friends and allies. What I hope to do is build on what is already a strong foundation,” he said.


Depose and Dethrone the King

Basiclly he insuated  “I’m a black muslim and in my country’s past people like me had no rights.  Now, I’m king of the place and trying to solidify my position by aligning with muslim nations so in the future my power cannot be usurped.  So I am puffing you up with this semi-transparent fluff and politics hoping you buy it.  I have America over the barrel financially.  You want me to back you and I will flex my powers, but you need to back me as my friend because I am backing you now.

Get on the phones to your elected representatives, tell them to step forward and take control of their own office and follow the constitution in coming up with rules, policies and regulations.  Tell them  to take control back from Obama.  Depose him as king and put him in his place as the President of the United States, it is a title, entity and office which he holds and was elected to fill and take care of according to the people for the people in accordance with the U.S. Constitution and all our laws in existence today.  If he won’t step down as King which he is trying to become, then impeach the man for trying to take over the country as a despot.



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Stimulus & Economy Snapshot 03/29/09

In Money Buzz, Political Buzz on 03/29/2009 at 4:18 pm

Obama & Democrats rein in Wall Street, broaden agendas 

Obama and congressional Democrats are going where no previous administration has dared to tread before.    They are seeking to capitalize on the recession to rein in Wall Street and broaden government’s reach farther than any previous administration.

Timothy Geithnersparked a Wall Street rally with his announcement and release of the toxic asset relief plan.  It includes a major overhaul of financial regulations presumably to ward off another meltdown.   Of course the congressional Democrats put their own trappings into the plans budget that while seems full of ambition is stuck with more deficits.

All of these new policies in the plan have increased the role AND authority of government in the business sector.    Leveraging money from investors, taking over more institutions,  closer monitoring and tighter controls over financial markets,  plans for more hands on direct influence over health care, energy and education sectors are all in the plan.  Through regulations, strings attached, rules, guidelines and other ways of using “a big stick” the administration seeks to force all these changes onto the public sector.  Seems like “Uncle Sam” wants to be more “Big Brother” and get control in many areas where they only could regulate in the past.  They are seeking to take active roles in the directions and operations of private enterprise.  The concept is noble, “We are going to step in, shore up, aid and help those in trouble.  We are going to protect the American Tax Payer’s investment where we get the money from by stepping in and monitoring what you do with the money more closely.” 

Nice concept but as we know to be true from experience, what is said up front and allegedly intended is not the way it usually works out.  Big Brother is flexing his muscles so be wary of what you agree to now!  Big brothers often are great to have around, but some big brothers are a terror and bully to the weaker siblings.

Rep. Mickey Edwards, an Oklahoma Republican and Princeton University lecturer said, “Proposals that are being made are to have the U.S. government much more involved in financial and business decision making.   “Whether it’s leading up to the G-20 and saying how do we reassure the rest of the world of our leadership, or how do we have a regulatory system that works with what the world looks like now — it’s a big moment.”

Big Brother, Tyrant or Turn Around?

Obama has used the economic crisis to his full advantage.  From getting elected to  justifying his plans and budgets to end our economic crisis he has used this depression as an excuse to further his own agenda.  Even though by his own estimate, the country’s woes won’t be over and we won’t be out of the recession until 2011.  Just listen to the man speak:  “This budget is inseparable from this recovery, because it is what lays the foundation for a secure and lasting prosperity,” he said during his prime-time press conference Tuesday.

All too often, good intentions and efforts mask sinister ulterior motives.  Look at history to see how tyrants come to power!  In times of great strife, a voice of hope and reason starts to be heard.  The masses in fear turn all over to the voice to help them get out of dire straights and bring them hope and salvation.  At first, it works, things change, hope floats, prosperity abounds, but it is selective where all the hope and benefits go.  But then the hidden agenda starts to manifest itself.  What was at first success and gladness ends up becoming a nightmare and devastation.  Look to the mans actions!  His very first act as president?  Going to a foreign country and doing an interview on a Muslim news program.  His VERY first act as president was to leave the United States behind and go speak to the Muslim world.

I’m not saying this president is the Anti-Christ here to bring the end of the world upon us.  Nor am I  saying he is a despot or tyrant or dictator in the making.  But  I AM saying that the American People need to stand up, speak, be heard, hammer their legislature, representatives and elected officials to let them know they are all being watched.  Tell them what YOU want and what YOU think the problems are in this country.  Tell them WHERE you want this money to be spent and what it is going to take to prove to YOU that these things are needed, beneficial and being done for the right reasons.

It is very easy to succumb to fear and give away all your freedoms.  Look at the patriot act, look at some of the bailouts and take overs, look at what laws have been getting passed, look at what has happened in other countries.  THEN compare these things to historical evidence and facts and you will see that if you are NOT careful, we can repeat the mistakes of history.

We don’t really need new laws and regulations.  We have enough of those.  We don’t need the government to take over our business or our lives and tell us what to do.  We need them to step up, be responsible, follow the rules in place, act upon them and enforce them uniformly.  That is what we need.  There were rules, regulations and laws in place that were violated that allowed this melt down.  Yes, there were some loopholes created by other laws that were written that they too didn’t need but rather needed better enforcement.  Trying to fix one problem they created another.  So too can we end up with manynew problems tomorrow arising out of today’s “fixes”.  We are too quick to react with legislation sometimes.  Our fear brings a knee-jerk prompt reaction that can do more harm than good if we aren’t careful.

All the billions spent and being spent are not going as intended, the problem isn’t fixed, we are still in economic turmoil, we have fewer freedoms, businesses are still failing, people are losing jobs, homes and all they have, government is getting more powerful and taking control of more business and yet we still do not see light at the end of the tunnel.

Geithner’s  New Deal

While the toxic asset purchase plan is risky and could cost billions in losses to the taxpayers, it could rescue the banks.  Thus making money for both the government and the private investors going forward into the future.  That seems to be Geithner’s goal.  But the government shouldn’t be “making money”.  It needs income to operate true.  Programs require money and so does operating and protecting a country and all it’s citizens.  But these are new waters and new “for profit” undertakings that have never been dealt with before.  For profit business, non-profit enterprise, religious, private individual and government entities have always been separate though working together.  Now, some of the lines are being blurred, mingled and crossed.  The markets and business seem to like this new turn of events as the Dow Jones industrial average shot up nearly 500 points the day of Geithner’s announcement.

Geithner rolled out his “New Deal” with new proposed rules for the financial sector.  He seeks to restructure the entire regulatory framework dating back to the days of Franklin D. Roosevelt when it was overhauled in the last Depression.

Geithner wants a goverment entity established with authority that can step in and take over large failing institutions.  Just like the FDIC now does with banks.  His plan also calls for another branch or body in the government with authority to monitor Wall Street risk-taking.  One that will be overseeing the markets that have been in the fringe or gray areas in the past.  Hedge funds and exotic financial products like the debt swap coupons that were derived to circumvent current laws and worked through loopholes.  Yet, we really don’t need this, all we need to do is reclassify these fringe classes into current regulated business types and let the existing regulatory bodies have more “teeth” to review, monitor and enforce what is already in existence.  It will cost more yes, but not as much as entire new divisions with new laws, new codes, new staff and probably less freedom and rights will cost.

Just like Obama, Geithner is using this frenzy of failure, fear, crisis and free flowing spending fervor as a tool and a way to bully the markets and big business plus push government officials to see things his way.  Geithner is Obama’s boy, there is no refuting that.  Obama’s administration is capitalizing on the financial crisis to push for robust new rules.   Listen to what they say, “We have a moment of opportunity now,” Geithner said, “and we don’t want to waste this opportunity.”  It is an opportunity for them to take advantage of us. 

Everyone Isn’t Blinded

Rob Shapiro, President Clinton’s economic adviser, questions how far this administration can play the economic crisis/fear card pushing the sense of urgency  and dire emergency need for action to the public and congress.  How far can they go with this before the public and congress starts to get wary not only of the cost, but the intervention.  At what point will it change and they are looked at more and more a government of intrusion and control rather than intervention and aid.   “The hardest problem that they face, and consequently the country,” said Shapiro, “is the separation between what might be economically necessary and what is politically acceptable.”  Shapiro is also a member of NDN, a think tank formerly known as the New Democratic Network.  Political sides put aside, officials on both sides are just now starting to ask questions. 

 Retailers Worried About Christmas 2009 Already

While most of us are concerned with today and next week, upscale retailers, luxury stores and toy stores are all looking at end of year expectations with a very cautious eye.

Shoppers are thinking about spring needs, some might even be worrying about summer.  But some retailers are hesitantly and cautiously reviewing their Christmas and end of year scenarios for 2009.  That’s because most of these types of merchants must place their orders now for estimated needs in their 4th quarter deliveries.

After suffering a dismal 2008 4th quarter,  the worst holiday season of the past half century, all these type retailers are being extremely cautious for the rest of this year.

We have seen the reports that this economic crisis, (why don’t we just call it a depression and stop candy coating it?) has affected everyone on every level.  The extremely wealthy and wealthy are also cutting back.  Many are no longer in the upper income areas and have come down to earth.  A few have also lost their jobs and homes.  Some deserved, some not.  But I won’t go there for this article.  The point is, even people that DO have money are being more frugal or conservative in their spending habits. 

Knowing this, these upscale merchants and the toy stores are ordering items that are at lower price points.  They are also ordering less keeping orders small and future inventories leaner.  They may buy more if consumer spending and demand picks up, said David Wolfe, creative director of The DonegerGroup, which consults with stores on apparel buying.  Toy stores are especially susceptible to 4th quarter results as it is the single biggest season they have in the year over most other merchant types.  Even other merchants vastly expand their toy departments or add one for 4th quarter revenue potential.  This year, that potential is going to be slender.

This is going to translate into less on the shelves, fewer items and less stock of items.  Anything that is popular will sell out quick and may or may not be replenished in time for the holiday season.  This will force an astute shopper to make a purchase sooner rather than wait for later if they know the item may not be there later.  It will create demand by shortening the supply.  It won’t increase the gross numbers at all.  But it can mean the difference between profit and loss for the retailer.  If they are not stuck with unsold merchandise there are fewer discount sales required to move it and less to no potential of a loss carrying unsold merchandise that must eventually be liquidated regardless the cost.  All has to sell eventually, it can’t stay in inventory and must move.


Manufacturers are feeling the pinch because it is a hard sell to their client and even for the items they do sell, they are selling less of them.  Furthermore, the larger retailers are able to negotiate best pricing and favorable terms that can include return for credit of unsold merchandise.  They are shifting burden of sale from their shelves back to the manufacturer.  So it’s like buying shelf space for the manufacturer.  This is going to force manufacturers and the entire distribution pipeline through to the end retail outlet to become smarter shoppers. 

This means fewer choices and if demand picks up any little bit at all over estimates, well, there will be fewer bargains if any for shoppers this season.  Retailers are more concerned about being saddled with unsold merchandise they have to discount and lose money on than if they run out of inventory.  As one industry CEO stated:  “We would rather chase than not and, if we cannot get it, we would rather not get it than have too much inventory,” during a conference call with investors.  “Because none of us really have figured out where this thing is going, where is the bottom, where is it settling in at.”  Another mover and shaker in the business,  Saks Inc. CEO Steve Sadove recently reminded investors that full-price selling is  “largely a result of supply and demand.”  Saks is cutting inventory 20 percent this year. Both Saks and rival Neiman Marcus have pressed top designer suppliers to lower their prices as I’ve mentioned above.

It’s not only toys, Clothing and other specialty retailers have to get their Christmas orders right because they can do as much as 40 percent of their business all at the end the year according to  Ken Perkins, president of research company RetailMetrics LLC. For the toy industry, at least half of all revenue and profit come during the winter holiday shopping season.

One thing is for sure,  expect fewer $200 robotic pets and other high ticket fancy toys on store shelves in the fall.   At luxury stores look for fewer “trends” and more classics rather than specialty items.  Anything that might have a short street life as in becoming passe quickly is being completely passed over this year as retailers are tightening up.  They want a short sweet inventory of what they know people look for year after year.  They aren’t as interested in what’s hot right now.  Jewelry stores are also planning to highlight classic styles and keepsakes.

There is a potential silver lining for small independents.  They will have much greater flexibility and be able to respond to their market quicker taking advantage of any hotspot there may be and also to bend and shift to meet their client demands.  For example,  retailers like Denis Hofstetter, owner of The Toy Store in Atlanta can benefit if they monitor their operation daily and watch for trends.  Small stores like this usually put their orders in later than the bigger competitors since they order smaller quantities.  They also order more often using JIT formulas.  “Just In Time” meaning they may pay a little more but are able to shift to meet demand because they buy less for inventory and more for demand scheduling their goods to arrive Just In Time to be used or sold.  Since this current market condition is going to keep inventories lean and pricing up at the bigger stores, the smaller stores will more competitive price wise with their larger counterparts as a result.  So the disparity is almost gone as to go to the big box or stay close to home and deal with the independent.

Suppliers know this as well and are trying to replenish numbers since the big stores are not buying the quantity they used to, they are lowering minimum order quantities to the smaller stores hoping to receive more orders and repeat orders from those able to move in the marketplace on shorter notice.   “Business is so erratic,” said Hofstetter. “Customers are being very careful. They’re holding on to their money.”  So even though there is potential for him to benefit, he is also being cautious and watching things very closely.

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Smokers Fined $11Billion!

In Money Buzz, Political Buzz on 03/29/2009 at 1:36 pm

Smokers Getting Fined with almost 300% Tax increase!

That is what it amounts to really.  Taxes are going up from 39 cents a pack to $1.01!  That cigarette tax will rise by 62 cents a pack beginning Wednesday supposedly to pay for children’s health care.  Somehow smokers are to blame for poor health in children since they have been singled out to pay more to fund children’s health care.   A noble cause to be sure.

However, as is often the case, BS and public raping via finance is often fed to us hidden behind the face of innocence.  After all, if anyone is against it they are a horrible person for not wanting to protect and save our children.  This is a double whammy of greed by the fed looking for more income and big business looking for more profit.

The price of cigarrettes already went up almost a month early.  Between 71 cents and 81 cents a pack.   So big business gets a month of massive profits and when the tax does kick in they are also still receiving new income from the 10-11 cent per pack price hike.  The price hike is hidden in the new tax so they can say “call your congressman to complain” as one Industry Exec has already been quoting to reporters.  The feds get a huge cash influx at a time they are on the ropes and strapped for cash from the multitude of  bailouts and bailout plans.

2007 – 360,000,000,000 cigarettes were consumed in the USA alone. (Estimate by USDA –Source: Tobacco Outlook Report, Economic Research Service, U.S. Dept. of Agriculture.)  .

That works out to 18,000,000,000 a year!  That is over $11billion in new windfall income revenue for the fed!  New tax income of over $11 billion! Tobacco industry gets almost $2 billion increased profit from this hike plus the month they jumped the gun and are keeping the tax hike AND their price hike.  New taxes on the American people without a vote

The money is already in the budget and spent on children’s health care.  This new money coming in will just go into the coffers because while it is tagged for children’s health care what it really means is they won’t have to pay as much toward that freeing up money in the overall budget to be used elsewhere.  They aren’t going to spend an additional $11 billion on child health care. 

 Just like all the states that used the innocent children to push through lottery laws.  “This will raise $billions for our schools” was the chorus.  The school budgets were stretched, population expands, services required, we have no money to fund this, new schools are needed, teachers need better pay to attract more and better teachers.  The list was endless of what all this money was going to do for the schools. 

So the people said “Oh it’s for the children!  We have to take care of the children, of COURSE we’ll approve a lottery!”  Except what happens is, the money comes in, millions and billions of dollars!  As agreed it all goes into the school budgets.  Except they start cutting funding to the school budget from other sources.  So the money isn’t all new increased school money.  They didn’t double and triple the school budget with this extra money.  No, all they did was replace the money in the budget putting a lot of the original schools funds back into the general funds and replacing it with the new school money from the lottery. 

That is what the fed is going to do with this $11 billion!  They will cut what they were putting in and add this new amount in. They are not going to spend an extra $11billion on our children.  If you believe that you have been duped like the rest of the American Public.  Start demanding transparency and accountability on these “back room deals” that don’t require massive legislation or public voting and you won’t be taken for a ride.

I used to be a smoker.  I smoked 2 packs a day for 20+ years.  Last year when money waqs getting tight, the economy was heading south and a gallon of gas was as much or more than the name brand I smoked, plus breathing seemed to be a little tougher, I decided to quit smoking.  It has been over a year smoke free without pills, patches, therapy or any of that “ez way”.  I just decided to quit, bought one more pack, dragged it out, made it last and when down to 2 cigarettes left in that pack a week later I threw it out and that was the end of my smoking.  A lot of mental work went into quitting, it wasn’t a snap.  But it was done by a long term heavy smoker.  So this article isn’t a rant from a smoker that don’t like paying more.  There is no hidden motive or agenda.

By the way, people that smoke are smoking more now than 2 years ago.  New smokers replace those they lost that quit (or died) AND excessive stress factors increase smoking excessively.  So this tax of FINE is more now than the $11billion as mentioned.  But it is based on known facts and numbers while a best guess has it over $14billion.  But still, lets go with the 100% guaranteed minimum.  This is not a one time deal either!  This is now a NEW TAX REVENUE ANNUALLY OF $11BILLION MINIMUM TO THE FED COFFERS!

It’s not easy but anyone can do it.  The sooner the better!  My recommendation is to quit smoking!  If you want to chat with me about quitting and how I did it and I can help then contact me and I will mentor you through it.  BUT, that will come at a fee to donate to me to help me with my troubles.  Nothing is free in life, there is always something somewhere that covers it somehow.  Besides, I’m not in a position that I can give away any free time.  We are trying to save our family home and get it out of foreclosure.  I am working in various ways to generate income for us to live on.  Help me, I help you and we all win!  Either that or keep smoking and hurting yourself while you GIVE THE FED AND BIG BUSINESS YOUR HARD EARNED MONEY!

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Stimulus & Economy Snapshot 02/24/09

In Money Buzz, Political Buzz on 02/24/2009 at 5:10 pm

Obama Needs To Take Care Of America FIRST

A government official speaking on condition of anonymity, said Obama may contribute $900 million of US Aid to humanitarian and rebuilding efforts the Palestinian Authority.  This is purportedly to help Gaza recover from Israeli attacks last month against the Hamas faction.  Obama’s Muslim roots are peeking up again.  The United States needs to take care of United States Citizens at HOME right now.  We’ve already spent billions of dollars in aid and rebuilding for Iraq.  Put America First. 

By the way, there ISN’T any money for these foreign aid programs.  We are spending it on America.  Since all this spending is putting us over a Trillion dollar deficit, we don’t need to increase our shortages by spending more of what we don’t have on something we won’t get and don’t need if we could get it. 

Bernanke Claims Recession May End This Year

Federal Reserve Chairman, Ben Bernanke, gave his semi-annual report to the Senate Banking Committee.  In it he stated it was his belief that the nation’s economy was going to continue contracting the first half of this year but he was optimistic concerning the second half.  He went on to say that it was possible the economy could turn around in the second half of 2009 but it warned that it is predicated on the credit and financial sectors operating normally again. 

In response to his comments and hopefuls thinking that Obama’s prime time speech tonight will also be positive, the markets, stocks and major indexes inched upward by closing.

It’s clear Bernanke has some political machinations going on.  It’s inconceivable to think that everything is going to be fine in a few more months.  It’s also a little early to claim the recession is coming to an end soon considering we had a runaway train of a recession the ran right into the start of a depression.  We teeter on the brink of a depression that could make the Great Depression of the past seem like a mild recessionary market blip.  We just spent $1.5 trillion in the past 6 months and there looks to be another $1 trillion or more needed with all the different plans, bills and programs in various stages of development still.  He hasn’t said anything new that we don’t already know.  IF the finance and credit markets were operating normally we wouldn’t BE in this predicament.  The lenders have money now but they aren’t lending!  They are sitting on OUR money and remaining liquid while WE take the heat. 

I find it hard to believe he is floating this balloon right now.  But then, with the President set to make a speech tonight, he was most likely told to do so and then the president can gauge the reaction  and perhaps use it to bolster his position and make it look like everything is working out better than expected.  What a load of fertilizer.  Don’t start development of a new bubble with “irrational exuberance” Mr. Bernanke.  Just last week you unveiled plans to print a bunch of money based on wind to increase the money supply.  Yeah, THAT will stimulate the financial markets.

FED Pressuring Banks Sitting On Bailout Funds

A number of banks have received bailout funds both last year and this year.  They are receiving more funds from the Fed when they print more to increase the money supply.  This was done to help stop closures, losses, insolvencies and create incentives to halt foreclosures and work out home saving programs with homeowners.  Well that isn’t happening.

Besides investigations that have uncovered misuse of funds it is clear the Fed still sees a big problem or potential problem.  First off, the economy CAN NOT IMPROVE unless credit markets free up and both consumers and business can afford to borrow and spend.  It has been discovered that a number of beneficiaries of the bailout have done nothing to increase lending but instead used the funds to shore up losses, remain liquid and pay themselves.

That’s right, so far there have been instances discovered that executives were paid large bonuses at a time their company was losing money.  Furthermore, it seems that many banks are still trying to maintain investor satisfaction by continuing to pay out handsome dividends.  The Fed is finally doing something about it.

The 12 regional Fed banks and the bank holding companies they oversee recently received a guidance letter.  In it the Fed noted there is going to be an increase in scrutiny of dividends when assessing capital adequacy.  Those firms that receive funds from the U.S. Treasury’s Capital Purchase Program will be under even more scrutiny.

“While many organizations place great importance on maintaining their dividends, a board of directors should reduce or eliminate dividends when the quantity and quality of the bank holding company’s earnings have declined or the (firm) is experiencing other financial problems or when the macroeconomic outlook for the (firm’s) primary profit centers has deteriorated,” the Fed said.

The Fed has been urging banks with increasingly strong language to put the bailout money they have received to work as it was intended to be use.  Put into new loans and replenish their regulatory operating reserves.  It’s not money meant for bonuses, remodeling and definitely NOT for payment of dividends.

In this guidance letter, the Fed said recipients of these  bailout funds are going to have to explain to Federal regulators how their “proposed dividends, capital redemptions and capital repurchases are consistent with requirements applicable to its receipt of capital under the program.”  The Fed wants to discourage use of these funds to pay dividends on trust preferred securities and repayment debt obligations.

Banks need to cut, eliminate or defer their common stock dividends if earnings during the past year were not enough fully fund the payouts.  The Fed added some real teeth to it’s outline of  what it wants banks to do.  “Failure to do so could result in a supervisory finding that the organization is operating in an unsafe and unsound manner,” was the Fed warning in the letter.  A nice way to say do it our way or we will take you over and make you d it anyway. 

Oil Up, I Told You So

Oil prices surged today to close just short of $40 a barrel.  All I have to say really is, I told you so.  The movement is based on nothing but general market conditions.  No news or middle east flare up, no official cuts from OPEC, nothing.  The only thing noteworthy is there was no announcements concerning oil but the price went up anyway.  Like I said, buy now for Summer contracts.  Prices will climb higher.

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Stimulus & Economy Snapshot 02/21/09

In Money Buzz, Political Buzz on 02/21/2009 at 4:34 pm

Daily Economic News & Insight

$8,000 Stimulus Tax Credit For New Home Buyers

This is good news for NEW home buyers.  That means it is for “First Time Buyers”   This is RETROACTIVE to January 1, 2009 so it’s a literal windfall for many.  To qualify, the purchase must be done between Jan. 1, 2009 and Nov. 30, 2009.  Buyer can NOT not have owned any home in the last past three years to meet the “first time” buyer requirement.  There is one string attached, they have to LIVE in the home a minimum of  three years, or they will be forced to pay back the FULL amount of the credit they received.

This is a FUTURE benefit of the stimulus bill recently signed.  You WILL get the credit if you qualify but it is going to be next year when you file your taxes.  A real incentive to file on January 2nd 2010 to be sure.

This is a credit but it is FULLY REFUNDABLE on your tax bill next year.  So no matter what your tax scenario is, if you meet the criteria above you will receive a credit on your taxes next year.  If you still owe $1,000 on your taxes when you file, instead of sending a check like usual to the IRS, $1,000 of the credit will pay your tax liability.  The $7,000 remainder of the credit is the amount that you will receive from the IRS as your refund.  If you overpaid during the year and you are due a refund of $1,000 on your taxes, it will be ADDED to your refund giving you a tax refund check of $9,000. 

This measure is geared to stimulate the economy by enticing new buyers that were waiting on the sidelines to see what will happen.  It is also a very expensive part of the stimulus bill that Obama recently enacted.

But you don’t have to wait until next year to start receiving the benefits of this credit.  If you know your tax bill and plan accordingly you can make changes for your withholding at work now and have less withheld from your paychecks.  This will increase your weekly take home pay now leaving you a tax liability in the future.  Just make sure you work it so your liability won’t exceed $6,000 so you have a margin for error.  This way you endup with an extra $500 a month in disposable income or  to put in a savings investment allowing you to generate income or interest on money you would not ordinarily see until next year.  It is also “tax free” money you are investing as it comes from the credit refund which is not taxable income.  Before making any decisions check with your tax advisor for details on the refund and how you might benefit implementing any of these ideas.

Our Crisis Is Worse Than The Great Depression

Paul Volker, former chairman of the Fed in the chaotic 80’s and currently one of Obama’s top advisers, compared current crisis to the Great Depression.  He noted that the United States output which is already suffering, is falling more rapidly than global industrial production.

Speaking at a meeting of investors and economists at Columbia University he stated, “I don’t remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world”

He further commented that since we have this crisis on our hands it’s time for more and tougher regulations in the financial industry.  Especially for the largest institutions.  Those that are too large to be allowed to fail due to far reaching effects should have the highest degree of regulation and scrutiny.

Obama Says Tax Cuts Soon To Benefit Workers

President Obama said the stimulus plan tax breaks are going to kick in soon on his most recent weekly radio speech.   “I’m pleased to announce that this morning the Treasury Department began directing employers to reduce the amount of taxes withheld from paychecks, meaning that by April 1st, a typical family will begin taking home at least $65 more every month.” 

While a few dollars more per month is nice, it’s not going to entice consumers to run out and buy a car or travel or spend more.  Much like prior stimulus checks that were hundreds of dollars were issued in prior years, the money just paid off some bills in most cases and did little if anything at all to actually stimulate the economy.

We need to get people BACK to work to receive this benefit and we need to get people $1,000’s of dollars EACH to save their homes, cars and get caught up to be able to spend money in the economy on new “things”.  Even then, savings are more than likely to occur rather than increased spending.

However, if you want to read the house bill signed into law click on the following link for actual bill taken from Library of Congress Records (Word Document):  Stimulus Bill H.R.1 Tax Benefits Section


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Stimulus & Economy Snapshot 02/20/09

In Money Buzz, Political Buzz on 02/20/2009 at 12:41 pm

 Daily Economic News & Insight

NY Post Cartoon Controversy – Stimulus Monkey

This is the cartoon that created such a stir and sparked protests amid a cry for an apology.  The post stopped short of a full apology but did say no offense was intended nor was it meant to be a racial stereotype comparing Obama’s race to that of a monkey. 

Stimulus Monkey

It commented that the negative hype surrounding this cartoon was fueled by its enemies and pushed it out of context.  I don’t know, looks pretty clear to me what they are saying.  Unfortunately I have to agree with “context” it allegedly proposed,  tying two current events together;  The news about police officers forced to shoot to kill a chimpanzee that had gone berserk and critically attacked someone.  The stimulus bill being written and signd into effect.  A bill that, for all the good it is going to do any of the regular people,  could just as well been written by a berserk monkey.

Wall Street Spirals To New Lows

Markets continued their slide from yesterday slipping to new ”six-year lows” according to the  numbers so far today. 

While financial sector led the charge downward a couple notable reports further worried investors.  Lowe’sand J.C. Penney released lower than expected 4th qtr. results and simultaneously forecast that 2009 earnings are going to come in below analysts’ expectation as well. 

These two offer up confirmation that this recession/depression is being felt hard by the general population and businesses that service them.  Investors are already worried about the weak banking industry and the fact that the government effort to stabilize it is both vague and while a lot has been implemented, results are yet to be seen if they will work or not.

This general mood of investors including the large investment houses was summed up by Wasif Latif at USAAInvestment Management Co.  “There’s perceived disappointment from the lack of clarity from the Treasury for what it will do with the financial sector.”  That has been the cry of the nation for months now, all this hype, meetings and billions of dollars.  But nothing concrete and no firm results as of yet.  Unless you take into consideration the misuse of funds, the investigations underway about some of those funds AND the lenders that are sitting on a lot of money AND the lenders that overcharged the government for the assets they delivered.  But then those really aren’t good results are they?

On the bright side, for us not OPEC, Oil fell $1.66 to $37.82 per barrel in trading in New York so far today.  Yeah, you can count on production to be cut to bolster the price in the near future.  At $37 and below it’s a buy short term anyway.

Bank Of America CEO Subpeonaed  On Bailout Fund Improprieties

 In the ongoing investigation by the New York State Attorney’s office, Cuomo subpoenaed BofA’s CEO to question him about the alleged misuse of bailout funds last year at Merrill Lynch.  At the heart of the matter for this round are the expensive bonuses paid to Merrill Lynch executives.

The bank was in the final stages of acquisition of Merrill Lynch at that time and their stance is that Merrill Lynch was an autonomous entity still when the bonuses were paid out.  The attorney general on the other hand has evidence that BofA was complicit in the payouts having prior knowledge and nodding tacit approval of same according to internal memos and other information so far discovered in this case.

The problem here is that Merrill Lynch received billions of dollars in the bank bailout last year, they were at the end of their worst performance quarter losing $15 billions for that quarter alone.  Yet during this period of loss they rewarded their executives with lucrative bonuses to the tune of $3.8 billion.  Investors were not properly informed of the payouts nor the company condition at the time is also a contention of the probe.

The information about the bonus payoffs for failure came within days after Bank of America  received an ADDITIONAL $20 billion from the government.  It claimed it needed the money to partially offset the losses it took on in the Merrill acquisition.  In addition the government promised to cover another $100 billion losses in risky assets. The additional support came with the package as Bank of America Corp. Chief Executive Ken Lewis was becoming apprehensive over completing the take over.  This extra money helped close the deal you could say. 

It was the government that orchestrated this take over so they wouldn’t have to deal with another failure like that of Lehman Bros.   The bailout money was being used to cover losses caused in part by bonuses not to mention any federal aid direct to MerrilLynch and how it was used.  We DO know someone there got a $35,000 commode during this period.  That was also being reviewed by a commission.  All I know is I lost money buying stock in Lehman Brothers based on their “glowing reports” and glorified hype only to have worthless stock a month or so later as it went belly up. 

GM Files SAAB Bankruptcy

Swedish company SAAB, owned by GM, has been placed into reorganization bankruptcy to protect itself from creditors.

Keeping in line with GM’s plan outlined recently and reported by me a few days ago, SAAB is to be restructured to make a sale possible.  They intend to divest themselves of this holding but to make it attractive to a buyer AND profitable to themselves, they have to force the government to step in and eliminate some debt while demanding “greenmail”.

GM said they need $1 billion in cash get this unit turned around, reorganized and ready for sale.  This comes at a time GM is fighting to avoid bankruptcy here in the USA.  They hope the three month reorganization program will let them put the Swedish brand into shape for a sale.  GM spokesman Chris Preuss said, “We fully intend to be out of Saab by the end of the year.”  They want US taxpayers to give them billions in aid so they can spend $400 million of it in another country!?

Obama Demands Accountability

In an effort to avoid an Obamagate that will turn us into an Obamanation, the president addressed mayors at the US Conference of Mayor’s stating, “If a federal agency proposes a project that will waste that money, I will not hesitate to call them out on it, and put a stop to it,” he said. “I want everyone here to be on notice that if a local government does the same, I will call them out on it, and use the full power of my office and our administration to stop it.”  This comes amid an assortment of scandals concerning money already released and criticism of the current plan AND plans in the works.

To help keep a semblance of transparency the fed has a new website at where it will put most of the public information regarding the recovery act.  Also, the fed released a 62 page document outlining all the instructions to the agencies involved entitled “Initial Implementing Guidance For The Amercian Recovery and Reinvestment Act of 2009.”

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