by MN Gordon
Rubbernecking at the economic train wreck of central planners is not without hazard. A strained collar and dry eyes, for instance, are common perils. So, too, is the lasting grimace of disbelief that comes with the rollout of each zany scheme to save us from ourselves.
Etched forehead lines and nighttime bruxism are several of the secondary effects. Not owning shares of Amazon is another. Though, over the long term, this will likely be an advantage.
Certainly, gawping at the present execution of monetary and fiscal policy in America is not without some benefit. A healthy suspicion is garnered of politicians and public officials. This, at the very least, relieves us from voter’s remorse. Since we didn’t vote for President Obama we don’t have to live with the soiled conscious that most surely befalls those who (Read More....)
. . . → Read More: Even Death Won’t Save Us
by MN Gordon
Today we look back to the recent past with singleness of purpose. Context and edification for the present economy is what we’re after. We have questions…
How come the recovery has been so weak? Why is it that, nearly seven years after the official end of the Great Recession, the economy’s still mired in a soft muddy quag? Squinting, focusing, and refocusing, there’s one particular week that rises above all others.
On Saturday September 20, 2008, Treasury Secretary Hank Paulson delivered a draft of the Troubled Asset Relief Program (TARP) to Congress for review. If you recall, it had been another wild week. On Monday, September 15, after 158 years of operation, Lehman Brothers vanished from the face of the earth…Dick Fuld, “The Gorilla,” be damned.
All week the sky relentlessly fell on financial markets. (Read More....)
. . . → Read More: The Cure is Worse than the Disease
by MN Gordon
The mass impulse of a cattle stampede can be triggered by something as innocuous as a blowing tumbleweed. A sudden startle, or a perceived threat, is all it takes to setoff this mass uncontrolled running. Once the herd collectively begins charging in one direction it’ll eliminate everything in its path.
The only chance a rancher has is to fire off a pistol with the hope it turns the herd into itself. If the rancher is successful, they’ll stampede in a giant circle. If the rancher isn’t, they’ll run off a cliff.
Today’s modern man, a complex species that ranges between Homo sapiens and Homo neanderthalensis, like Bos taurus, is also predisposed to herd behavior. What’s more, the human animal will take just about anything and everything to the extreme. Religious pilgrimages, sporting events, music concerts, New Year’s Eve celebrations, and political rallies gone (Read More....)
. . . → Read More: Gold Stampede Imminent
by MN Gordon
Dark storm clouds gather along the economic horizon. They multiply ominously with each passing day. The recovery, weak as it has been, has run for nearly seven years. Now it appears to be sputtering and stalling out.
On Tuesday, for example, iconic computer chip manufacturer Intel announced they’d be laying off 12,000 employees. Alas, with the decline of the personal computer, this has been a long time coming. But it was the full 10 percent decline of PC sales during the first quarter of the year that finally triggered Intel’s reduction in force (RIF).
Intel’s new plan is to reinvent itself. From what we gather the new strategy is to refocus its efforts on cloud computing and connected – internet of things – devices. “I am confident that we’ll emerge as a more productive company with broader reach and sharper execution,” said CEO Brian Krzanich.
Indeed, this will likely be true over time. Intel isn’t (Read More....)
. . . → Read More: Rational Insanity
Re-Published Post From David Haggith
Year after year around tax time, a tired war horse of a story gets trotted out about how the heavily burdened rich already shoulder eighty percent of the tax load. Poor rich. They are oxen doing the heavy pulling to make things easier on the rest of us dumb cows. Thank God we have them!
Don’t believe a word of it!
… It is hard for people to believe that the huge majority of all the money made in the US is going to such a small percentage of the population. As a result, when they hear that this group is paying 80% of the taxes (oh my!), they think that group is clearly pulling more than its fair share of the load. (Let’s hope the rich never get mad at us for putting this load on them and decide to stop carrying it.) I mean, expecting the smallest number of people to carry 80% of the load is crazy!
Actually, the crazy (Read More....)
. . . → Read More: Don’t Be Fooled by Stories that the Rich Pay Eighty Percent of the Taxes
by MN Gordon
“There ain’t no such thing as a free lunch,” is one of the essential axioms of economics. No doubt about it, there’s no getting around this simple truth. Everything has a price.
For example, even if someone buys you lunch the lunch still isn’t free. The opportunity cost, your time to eat the lunch when you could’ve been doing something else, has a price. In addition, even if you don’t consider your time a cost, there’s no denying the fact that someone paid for the lunch. Hence, it wasn’t free.
Nonetheless, despite this simple fact, politicians promise free lunches for the many at the expense of the few. This offense is especially on display during a presidential primary election. Free college. Free drugs. Free housing. Free food.
You name it, there’s hardly a lunch out there this season’s crop of presidential candidates haven’t already laid claim to. This is what they must do to get elected. This is how presidential politics works in a democracy.
We (Read More....)
. . . → Read More: No Free Lunches Be Damned
by MN Gordon
Former Federal Reserve Chairman Alan Greenspan resurfaced this week. We couldn’t recall the last time we’d heard from him. But, alas, the old fellow’s in desolate despair.
On Tuesday, for instance, he told Bloomberg he hasn’t been optimistic for “quite a while.” Obviously, this is in contrast to the perennial Goldilocks attitude he had during the 1990s. So what is it that has the Maestro playing a low dirge?
China, the dollar, Dodd-Frank, and associated unknowns are all part of his negative outlook. But the long winter of his discontent is something else. Greenspan said he “won’t be [optimistic] until we can resolve entitlement programs.”
“Nobody wants to touch [entitlements]. But it is gradually crowding out capital investment and that is crowding out productivity and that is crowding out the standards of living,” said Greenspan.
Indeed, funding (Read More....)
. . . → Read More: Alan Greenspan’s Pickled Economy