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Location: Sitting on a bar stool. Guinness in hand.
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Quote:
Originally Posted by freedom
Corporate Greed selling out our work force to Communist China, thanks Kissinger/Nixon/Goldman Sucks
Mass debt = raising taxes = mass unemployment = social unrest
History shows all of these things lead to full employment of our youth.
WAR!
WWIII is at our doorstep.
Quote:
Originally Posted by floridasandy
how can you say that when things seem so "stable"? look at today's headlines:
Iraq Bombs Kill 50 as Bloody Weekend Continues
Men in Iraqi Army Uniforms Kill 24 in Sunni Area South of Baghdad
Killings in Iraq Raise Fears of Renewed Violence
Iraq Election Tangle Stokes Fears of New Violence
Iraqi Public Doubts That Election Was Fair
German DM: Sorry for Killing Afghan Troops
US 'Moves on' After Karzai Fails to Apologize in Call to Clinton
Wikileaks to Unveil Secret Video of US Airstrike in Afghanistan
Ahmadinejad: Sanctions Help, Not Hurt, Iran
India Rebuffs US Call to Shun Iran Gas Talks
US Warns Pakistan Against Gas Pipeline Deal With Iran
Iraq, Afghan Wars Biggest Logistical Effort Since WWII
Obama Expands Military Involvement in Africa by Daniel Volman
Arizona has been running a deficit for years. The problem is an unwillingness to raise taxes or, alternatively, make the necessary cuts to services. It isn't helped by the federal government taking the lions share of tax revenue ... I pay a lot more to the Feds than I do to the state.
Politicians never see beyond the next election so we will never see a bi-partisan long-term strategic approach to the problem.
The first lesson in this is that you can't keep raising taxes to solve a spending problem. CA has finally run out of people to tax with the higher unemployment. What good will high taxes do when there are fewer and fewer left to pay. You have to cut programs.
The first lesson in this is that you can't keep raising taxes to solve a spending problem. CA has finally run out of people to tax with the higher unemployment. What good will high taxes do when there are fewer and fewer left to pay. You have to cut programs.
I broadly agree with this. But it isn't enough to just cut programs. You have to go beyond this and look at longer term structural solutions. But politicians are incapable of looking at anything long term. Just look at Prop 100 - a temporary sales tax increase - yet another short-term bandaid for what is a long term problem.
The first lesson in this is that you can't keep raising taxes to solve a spending problem. CA has finally run out of people to tax with the higher unemployment. What good will high taxes do when there are fewer and fewer left to pay. You have to cut programs.
Not just programs. Regulation.
The shear weight of gov't intrusion makes us about as competitive as bows and arrows against an M1 Tank.
I'm guessing our very good friends in China don't deal with the crap that American business has put up with.
This would help our unemployment problem. Can someone just try it?
I'm sick and tired of the poor quality from China and private information being all scattered around India, Malaysia, the Phillipines, and others. Did you know Equifax even uses the outsourcing (I should call it offsource outsourcing).
If you actually polled most working Americans and those unemployed (most likely lost their job to this), their comments would be interesting.
okay. i was led astray, just like when i see a shiny penny on the ground.
back on track, i don't think it is "coincidental" that moody's is changing the standards for the way they rate municipal bonds, for the first time in 100 years.
safe haven had an interesting article on municipal meltdowns back in january:
A good part of the country makes this assumption, including too-big-to-fail banks, retired municipal workers and municipal bondholders. Most experts will discount warnings of financial forfeiture. Experts are recognized as such because they say what their audience wants to hear. Americans should discount the experts.
On January 13, the U.S. Treasury Department released an updated Monthly Treasury Statement for December 2009. Scrolling down to Table 3, estimated revenues for the fiscal year (which ends September 30, 2010) are $2.2 trillion. Budget outlays are expected to be $3.7 trillion.
The $1.5 trillion deficit for the current fiscal year needs to be funded, but the market for Treasury securities has a limit, certainly if it expects to sell securities at 3.7% (the current yield on a 10-year Treasury bond). If the U.S. dollar is to avoid Zimbabwe's predicament, where the annual inflation rate passed 200-million-percent some time ago, the negligent states will be told to solve their own troubles.
This will leave many people in a fix, including public sector retirees. It has long been assumed by most government workers, particularly those in unions, that their pensions are guaranteed. This is not true. Every state has legal recourse. (See page 9 of "The Coming Collapse of the Municipal Bond Market" on my website, AuContrarian.com).
Crain's may be one of the first to contemplate the fragility of these benefits: "The sharp rise in pension payments is the biggest factor pushing Illinois toward what a legislative task force last November called "a 'tipping point' beyond which it will be impossible to reverse the fiscal slide into bankruptcy."
Crain's quotes a "little-noticed report" produced by a legislative task force that addressed the state's pension problems. The report-that-nobody-wanted-to-read claimed: "the radical cost-cutting and huge tax increases necessary to pay all the deferred costs from the past would become so large that many businesses and individuals would be driven out of Illinois, thereby magnifying the vicious cycle of contracting state services, increasing taxes, and loss of the state's tax base."
Crain's goes on to explain the problem of a destitute state, legal claims not withstanding: "While the Illinois Constitution protects vested pension benefits, that promise, like all the state's obligations, is ONLY AS GOOD AS ITS ABILITY TO PAY." [My italics.]
I been saying this for years. These states are not going to be able to pay these pensions. Illinois is at least 5B unfunded mostly tied mostly to teacher pensions. But the number is mostly likely worst then that . CTA in the Windy city is at least 100m unfunded for it's pension. They sold some bonds are losing money and mostly likely will not be able to cover them . Pensions are a time bomb on the whole West Coast and New York as well. I was talking to a teacher in the Southern state were I grew up. He tells me the teacher pension fund is well funded. However the state workers fund was well under funded. The state wanted to put them together to make things look better om paper. This was years ago before our current mess. Medical costs will send most state pensions funds down the tubes. Their will be roits in about 15 years when teachers city workers and cops understand they will get almost nothing.
Most state governments are set up along the Keynesian economic theory that supports the notion of government being one leg of an economic three legged stool, here in Washington state the heat's on and will stay on as long as the debt load continues to pull down the budget that was counting on continious growth of asset equity.
I don't see this collapse of credit as anything but proof of the natural path that unrestrained markets must take. As much as some hate the very idea of government assuming a business like stance it's only natural in a capitalistic society. You can't have the "invisible hand of the market" taking care of it's propensity toward greed, Adam Smith and others were certain of the self correcting mechanisms they saw in the beginnings of raw capitalism, they just couldn't see the future of an ambitious state.
Washington state government is the largest employer in the state, that is the fact that makes any "turnaround" in the economy an impossibility. In the end we'll have to go back to a sustainable living standard and the state will shrink it's role in the economy, as it should be...
Most state governments are set up along the Keynesian economic theory that supports the notion of government being one leg of an economic three legged stool, here in Washington state the heat's on and will stay on as long as the debt load continues to pull down the budget that was counting on continious growth of asset equity.
I don't see this collapse of credit as anything but proof of the natural path that unrestrained markets must take. As much as some hate the very idea of government assuming a business like stance it's only natural in a capitalistic society. You can't have the "invisible hand of the market" taking care of it's propensity toward greed, Adam Smith and others were certain of the self correcting mechanisms they saw in the beginnings of raw capitalism, they just couldn't see the future of an ambitious state.
Washington state government is the largest employer in the state, that is the fact that makes any "turnaround" in the economy an impossibility. In the end we'll have to go back to a sustainable living standard and the state will shrink it's role in the economy, as it should be...
the problem with the government is that we don't have government enforcement of the laws anymore. The FDIC has a law called "Prompt Corrective Action" (USC 12 Chap 16 Section 1831o) which the FDIC and other regulators have absolutely ignored for the last three years.
This law applies to all insured depository institutions, including the "too big to fails" such as Wells, Citibank and JP Morgan. It was put in place after the S&L crisis specifically to prevent the abuses that were rampant during those years, including evasion of capital requirements, lies about asset valuations and other forms of control fraud that led to bank executives stealing billions from taxpayers and prudent institutions during the S&L crisis.
This law begins with:
Each appropriate Federal banking agency and the Corporation [that's the FDIC - ed] (acting in the Corporation’s capacity as the insurer of depository institutions under this chapter) shall carry out the purpose of this section by taking prompt corrective action to resolve the problems of insured depository institutions.
Note that it doesn't say "may", it doesn't say "except for institutions we think are too big to fail", it doesn't say "except for politically connected firms that are performing obscene acts on myself and other banking regulators, whether they be acts of bribery with money, votes or sexual favors."
It says shall and it provides no leeway or discretion.
This law, if followed, absolutely prevents the FDIC from taking deposit fund losses. It also prevents "too big to fails" from being too big to fail, since they are subject to the same sanctions and closure as is the small local bank on the corner.
It was and is the willful refusal of Sheila, along with Dugan at OCC, to follow this law as written that has enabled the "too big to fails" to continue to operate. Had that law been followed EACH AND EVERY ONE OF THESE INSTITUTIONS THAT TAKE DEPOSITS WOULD TODAY BE CLOSED AND DISSOLVED as the law provides for NO DISCRETION in the actions of these regulators. (denninger, who is right on target again here).
we have a system currently in place that is totally setting itself up to FAIL big time at some point in willful violation of the law.
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Bring 1/2 of the jobs outsourced back to the US
