I lost my mantra today.

I lost my mantra today.   

 

 

In the zone and engrossed by a lengthy to-do list, oblivious to gloom,  I walked through the front door  at work today and nearly walked past a client who’s been with our company for 5 years.   After an embarrassing double take that betrayed my inattention, I greeted Jim and learned that he lost his job several months ago.  Three managers were let go on the same day.  He was one of three.  This client is my first intimate contact with the recession.   

Ours is an academic economy, we’ve been telling ourselves.  We’ve enjoyed this mantra.  It’s been with us through many good “closes,” some unforgotten “losses” and most importantly, my own personal discovery of the martini and cabernet sauvignon.   

I lost my mantra today.  I still have my religion, such as it is, but I lost my mantra. 

Let’s talk about the grand summer of 2008 when the price of gas broke the buck.    That’s right a 222% change.  Percent change is change divided by base, right?  True, the price of gas only doubled in 2008.  Well, let’s get this right.  Prices hit three dollars then dropped for the 2006 mid-terms.   They hit four dollars then dropped for the 2008 election.  OK, but gas was $1.35 before we invaded Iraq.  It went above $4.35 in the summer of 2008.  That’s  $3 / 1.35 = 222% increase in five years.   222%

 Why has the media let off the hook those responsible for the price-fixing that defined 2008?  Demand more for your money,  America.  Demand the truth.   Who was responsible for the price fixing?  Yes, Wall Street is guilty of mortgage crimes.  Bankers are guilty.  Consumer borrowers are guilty.   There’s plenty of guilt.   You and I share in the guilt, reader and writer.

How did the 222% increase in gas prices affect the economy?   If this increase was the result of anti-trust violations, we have to hold accountable those who were responsible. 

When  you get filthy rich by breaking the law, there is a price to pay.  No exceptions. 

 

 

Old headlines, just in case you forgot about gas prices.

http://www.usatoday.com/money/economy/2006-04-27-energy-econ-usat_x.htm

By Barbara Hagenbaugh, USA TODAY

WASHINGTON — The U.S. economy has digested surging energy costs in the past few years with little more than a hiccup.

In a USA TODAY survey of economists taken April 20 to 25, 40% said higher energy prices are the No. 1 risk for the economy. While other risks were cited, such as a decline in the housing market and terrorism, energy was the top concern.

http://www.nytimes.com/2008/06/09/business/09gas.html

Here in the Mississippi Delta, some farm workers are borrowing money from their bosses so they can fill their tanks and get to work. Some are switching jobs for shorter commutes.

People are giving up meat so they can buy fuel. Gasoline theft is rising. And drivers are running out of gas more often, leaving their cars by the side of the road until they can scrape together gas money.

http://www.iht.com/articles/ap/2008/08/04/america/Economy.php

Economists believe the $168 billion stimulus program will continue to lift the economy in the current quarter, but many are worried that the economy could slow significantly in the final three months of this year and early next year as the impact from the one-time checks wears off.

Brian Bethune, senior U.S. economist at Global Insight, a private forecasting firm, said the GDP could post back-to-back declines in those two quarters, meeting the traditional definition of a recession.

“The rebates are not translating into anywhere near the spending impulse that Congress and the administration had hoped for,” he said. “Under these circumstances, the economy remains in very fragile condition.”

A little less passive aggressive, A little less spending, Mr. President

A little less passive aggressive

A little less spending, Mr. President

Your Support with Independents is sketchy

Thousands of bloggers intend to hold you accountable

Will Tax Cuts Really Help?

On Limbaugh’s Demands for Additional Tax Cuts

• The Bush administration spent trillions of dollars we didn’t have on things we didn’t need as well as things that did us harm like an unprovoked war in Iraq. Sooner or later this debt must be paid down. Later is almost here.

 • During the boom days of the past decade (that were created by wistful real estate buying and obstruction of mortgage regulations by the executive branch of the federal government) the Bush tax cuts (for the old fashioned investor classes) failed to generate sustainable economic growth across class lines as required for trickle-down economics to work effectively. In other words, new jobs, new businesses, new money were not created at levels that could generate the tax revenue required to manage the eight Bush budgets. Bottom line: trickle-down, Reaganomics, tax-cut stimulation failed in the 2000s to keep up with government spending just like it failed to keep up with government spending in the 1980s. These facts pre-date the onset of the banking crisis which became publicly visible in August of 2007. Our government was outspending itself in the good times.

• Rush Limbaugh presently spends his days demanding more tax cuts based on his presumption that we have not yet figured out that the Bush tax cuts didn’t work. The boom of the 2000s was a speculative housing bubble. Period. Nothing more. The Bush tax cuts did not generate sustainable economic growth. The tax cuts Limbaugh now so crudely demands will perform the task of righting the economy no more effectively than they performed under Bush.

• I am challenging loyal Rush listeners to call the show this week and start asking the hard questions that Rush doesn’t want to hear. Mr. Limbaugh, isn’t “insanity doing the same things over and over and expecting to get different results? If so, why should I support the policies of the Bush administration that created the budget deficits that plague our country today? It didn’t work during the Bush boom, why will it work during the Bush crash?”

• I’ve read Limbaugh’s holy-grail, by the way, Atlas Shrugged.  I probably read it before Rush read it.  It is the reason I am a fiscal conservative and not a liberal. It is an exceptional book with truly prescient insights into the chaos that surrounds us today. The author understood that it is the captains of industry who make opportunity and that they must be rewarded with a fair and reasonable tax code. I am not in favor of Obama deficits any more than I was in favor of Bush deficits. All this said, there are elements of the Obama budget that we must accept as necessary medicine. This is the subject of a future post. For now we have to stay on task. Limbaugh is demanding more of the bad medicine that created the economic collapse keeping Americans awake at night.

• Post disagreements, agreements, questions and challenges of any kind on this blog.  Get a dialogue going. It’s time for all of us to roll up our sleeves and get into the heart of the questions at hand like:  more tax or less tax for those earning over $250,000 per year?

Rush Limbaugh & the Mortgage Crisis

https://lehmanbrothers.wordpress.com/

Lincoln’s Prayer Proclomation – second posting

After months of isolation, I nearly lost my desire for occasional solitude.  After years of corruption, I nearly lost my conservative balance.  While the election cycle recovers from the full-tilt we experienced over the past two weeks, I find I’m left with prayer and deciding between the Prayer of St. Francis and the Prayer of Lincoln.

Lincoln’s Prayer Proclamation

In 1863 Abraham Lincoln called the nation to repentance, confession of our national sins and turning back to God. We believe America, more than ever, needs to do this again. Seven months prior to his Proclamation for a National Day of Thanksgiving, Abraham Lincoln issued the following:

A Proclamation for a National Day of Prayer

Whereas, the Senate of the United States, devoutly recognizing the supreme authority and just government of the Almighty God in all the affairs of men and of nations has by a resolution requested the president to designate and set apart a day for national prayer and humiliation.

And whereas, it is the duty of nations as well as of men to own their dependence upon the overruling power of God: to confess their sins and transgressions in humble sorrow, yet with assured hope that genuine repentance will lead to mercy and pardon: and to recognize the sublime truth, announced in the Holy Scriptures and proven by all history that those nations only are blessed whose God is the Lord:

And insomuch as we know that by His divine law nations, like individuals are subjected to punishments and chastisements in this world, may we not justly fear that the awful calamity of civil war which now desolates the land may be but a punishment inflicted upon us for our presumptuous sins, to the needful end of our national reformation as a whole people?

We have been the recipients of the choices bounties of Heaven. We have been preserved, these many years, in peace and prosperity. We have grown in numbers, wealth, and power as no other nation has ever grown; but we have forgotten God.

We have forgotten the gracious land which preserved us in peace, and multiplied and enriched and strengthened us; and we have vainly imagined in the deceitfulness of our hearts, that all these blessings were produced by some superior wisdom and virtue of our own. Intoxicated with unbroken success, we have become too self-sufficient to feel the necessity of redeeming and preserving grace, too proud to pray to the God who made us:

It behooves us then, to humble ourselves before the offended Power, to confess our national sins, and to pray for clemency and forgiveness.

All this being done in sincerity and truth, let us then rest humbly in the hope authorized by the divine teachings, that the united cry of the nation will be heard on high, and answered with blessings no less than the pardon of our national sins, and the restoration of our now divided and suffering country to its former happy condition of unity and peace.

Abraham Lincoln

 

Prayer of Saint Francis of Assisi

Lord, make me an instrument of your peace.
Where there is hatred, let me sow love;
where there is injury,pardon;
where there is doubt, faith;
where there is despair, hope;
where there is darkness, light;
and where there is sadness, joy.

O Divine Master, grant that I may not so much seek
to be consoled as to console;
to be understood as to understand;
to be loved as to love.
For it is in giving that we receive;
it is in pardoning that we are pardoned;
and it is in dying that we are born to eternal life. Amen

 

Alas, my favorite:

Let this be a holy place for the human spirit consecrated to the forces which magnify the soul.

Holy grail of the republican party

Reaganomics had a hand full of positive outcomes.  

That said,  the upside to trickle down economics looks something like obsolete and out of fashion household possessions assembled for a lawn sale while the downside looks like America’s mounting credit card balances, bankruptcy rates and 10 trillion dollar  national debt.   Unless the American voter is prepared to learn Chinese, our debt has to be tended to by a responsible president.   Please read this link where you’ll discover that Reaganomics failed to delivere on its promise of sufficient tax revenue generated by economic growth. 

If you don’t trust wiki, call an economist at your nearest Land Grant University and ask her to discuss the upside and downside to trickle economics.

 

Go to:  http://en.wikipedia.org/wiki/Reaganomics

Banking Crisis — my problem with truth

My only problem with truth is that it requires a lot of reading.

 

Please read all the way through.  You will find significant blame for Mr. Mandate.  Go to:  http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html

Did Democrats Cause Crash?

Let’s put this in perspective.  The entire global banking system is imploding.  Governments across the entire planet are propping up, buying, nationalizing, insuring, lending to nearly every bank and investment firm in existence.   Those not yet affected will be affected by those presently failing as well as those yet to fail.  They all rely on each other.  When one fails another loses assets.  It is a positive feedback loop with devastating consequences. 

As we ask ourselves, did the democrats cause this, we have to put it all in perspective with this question;  Is is possible that a calamity of this magnitude was caused by Barney’s equal housing campaign?  Let’s think this through.  The sub-prime market was but a small piece of the global economy.  There ARE many factors at play.  Sub-prime is only one of them.  Congress may have encouraged sub-prime experimentation.  Congress did not pass any piece of legislation, though, directing any bank or investment firm to abuse derivatives or credit default swaps.  This problem is exponentially bigger than a trillion odd dollars in sub-prime  mortgages that still have a true present and future cash value.   

The Bush administration did in fact push this bubble up and up and up.  Please open a new browser window, go to www.google.com and put the words Office of the Comptroller of the Currency in the search window.  Dig and dig, America.  There is plenty of blame to go around, and much of it lands squarely on the Bush administration. 

All this said, within the past three weeks John McCain said the economy is fundamentally sound.   We now know without any doubt that John McCain’s understanding of the gravity of the situation could not have been more wrong.  John McCain is not qualified to lead America at this time.   Sit down, John.  Take a deep breath.  Then retire.

Go to:  http://en.wikipedia.org/wiki/Subprime_mortgage_crisis

Conservative Angst

I am an independent conservative who ten years ago moved from my family’s red state to Illinois.  The family-nurture influences on my social perspectives were Christian, Catholic, social conservative, fiscal conservative… you know the drill. 

Many of “their” values remain mine.  That’s why the arguments that I now have with conservatives leaves me, literally, with knots in my stomach.  The present administration has betrayed its party, its constituents, its country and democracy itself.  They have abandoned fiscal conservative restraint without even the pretense of accountability.  

Along the way, they have ignored the constitution, under-taxed the profiteers who bankroll their elections, lied their way into war,  botched that war at every turn, created multiple civil wars in the Middle East, incessantly fed the pressure points that have driven up the price of crude oil, dropped interest rates dangerously low for extended periods of time, encouraged unethical & immoral banking practices and brought the worlds banking system to its knees through misregulation …  The list of betrayals is too exhausting to continue. 

What hurts most is that my defense of conservative values today results in my being labeled a liberal.  Lib.  Progressive.  Fairy.  Tree Hugger.  Green Freak.  Atheist.  Commie Pinko Pig.   What kind of mind control is going on in this country?  Why do those betrayed not see this betrayal?

 

This is a republication of an earlier post.  The American climate feels right to put this one out there again.   New reader & contributors are welcome.

Psst, the banking failures began August 2007 – everything since is suspended animation

A few thoughts that I have to post before going to bed. 

• Hours before congress voted down the bailout yesterday, the government announced the extension of additional discount-window loans that will keep liquidity up for some time into the future.  Now there was an intense tightening of money in the days leading up  to Bush’s request for $700 billion dollars to be doled out at will by his right hand, Hank, or is it Brownie, I forget which.  My point is this.   The drama of the past month has been well planned and timed literally down to the hour and day.  Little was left to chance.   Even the drying up of commercial paper occurred right on time.  The banks actually failed more than a year ago.  The Fed has been extending loans to banks and investment firms all this time.  We are in a protracted state of suspended animation.  In one of my blogs, I said that I could not support the bailout if it did not eliminate the need for banks to borrow from the Fed.   The Fed did not wait for the bailout vote to announce the release of its next “bridge” loan for Wall Street bankers.  Money was drying up, as intended, so they could scare up votes on the Hill for the bailout.  
• I agreed with much of what Rush said during his first hour today.  The bailout is a scam.   It does not meet the criteria I outlined in a previous post to the blog.  It was designed in fact to save the weak and the guilty – prolonging the inevitable retractions that must follow a seven year bubble. 
• During the first several minutes of Rush’s second hour today, though, I heard a prologue to what promised to be a long and bellicose two hour rant about how the Liberal Democrats are trying to payoff the homes of (all these black people who didn’t qualify for mortgages to begin with).  The original bailout was introduced by Mr. Mandate himself, The President.  It is supported by McCain.  It was to be executed by the Republican, Hank Paulson.  One third of House Republicans voted for it.  Yes, Democrats are in the kitchen spoiling the stew along with the many, many Republicans who called for this pig roast.   Indeed they are.   Bush continues daily as well to step up to the microphone demanding immediate passage of this $700 billion aid package for failed businesses.  How do we get our minds around the transition from these facts to a rant blaming the bailout on Democrats?
• Is it logical to blame Democrats for this bailout creature that is being demanded by the President?