~ How about: Borrowing money from China and the Fed (selling treasuries at 3%) printing money. As in when there is a problem, solve it than run away - the curious thing is China knows what is happening and continues to go along as it is still their best bet and everyone should be happy with those rates. ~ The market held above 10,000 ~ 10170, so next week will be a better indicator for its future - for it to drop below 10000 there will most likely be a decidedly bearish tint through the spring - Nervous Nellie's the ones who bought on Friday.
What you are describing is speculation, trading and gambling. The bottom line is that the economy is still based on a stock and housing bubble. Another crash will really hurt the middle class with the loss of more money that they are pouring into the market. The borrowing is going to hurt the dollar some time in the future. The Fed is basically printing money to keep the bubble going. Freddie Mac and Fannie Mae continue to loss money every quarter and will need $400 billion dollars each to cover losses. Both Freddie/Fannie are providing 3% down mortgages and the FHA is the new subprime providing 0% down mortgages by including the closing costs in the loan amount. China can't stop buying dollars due to the huge trade surplus that they have with the US. But that doesn't mean that China is not doing anything. China is buying anything that they can get their hands on including gold, copper, oil, iron ore and you name it. Jimmy Carter had a democratic majority similiar to Barry Obama back in the late 70's. The DOW was at $1000 or the price of one ounce of gold.
Are you sure you are not mia, posting under another name? What has Jimmy Carter got to do with anything? The problem is the greed mentality of especially last 30 years that has made a situation that stock market has nothing to do with investing but more to do with how to empty pension funds and steal the money from middle class people who do not know any better. It is a Casino mentality that says "greed is good" and make money by buying stocks and gambling that may be it goes up without any consideration of underlying business facts. How can some one justify investing in a company like Google which was may be earning 0.00001 % in profit while you could put your money in the bank and earn couple of percents? But everyone was buying and gambling the price will go up.
Don't misunderstand me so quickly. As of today, after all the billions of dollars that were given to the failing banks: The banks are doing fine Real unemployment is at 17% and rising Major layoffs continue to be announced (Walmart announced today it is laying off 11,000 workers) The banks aren't lending The lack of regulation that existed BEFORE this crisis, still exists Congress quietly passed a bill that gives the major banks $4 trillion whenever they want it You must remember that we were all sold on the idea that the banks needed to be bailed out because that would improve the economy. THAT HAS NOT HAPPENED. What today's Congress did, in a nutshell, is reward failure and punish success. The banks that broke the law received billions in funds and raked in record profits. Meanwhile, Bank of America, which followed the law and was relatively unaffected by the banking crisis, was FORCED by the Fed to merge with Shearson, which resulted in damaging BOA and forcing the chairman of BOA to resign. The corporate structure is broke because the SEC is useless. If you want more proof, look at Zilog. This is a company that, four years ago, was vibrant and healthy and employed over 400 people. Then, a new management came in in the name of CEO Darin Billerbeck. Billerbeck quickly laid off 75% of the employees, spent millions on bonuses for himself and others, put the R&D team on projects with no chance of success then fired the entire R&D team. Billerbeck filed a fraudulent plan for recovery with the SEC where even the claims were so wrong it was comical. Now Billerbeck is accused of taking bribes in exchange for selling Zilog to IXYS below the market value. This is an obvious case of CEO Billerbeck raping Zilog, deliberately putting people out of work, and then squeezing the company for his personal profit with absolutely no interest in the welfare of the company itself. There are now at least six separate investigations into the Zilog IXYS buyout. What is broke is the SEC. Look at the SEC and the bank failures, look at the SEC and Zilog, look at the SEC and Madoff. The SEC is filled with unionized accountants of mediocre talent with little hope for advancement. How many people complained to the SEC about Madoff? Why were they ignored? How many other Madoffs are out there, how many other Billerbecks are raping their company? Why are all the banks still engaging in the same buying and selling of mortgages, the same as before the crisis? No and no. I'm not saying give every household a $27,000 check. It can be done much cheaper with tax cuts. To put things in better perspective, Congress should have done what Reagan and his Democratic Congress did - give people deep and immediate payroll tax cuts. This way, the middle-class that are still employed now have more disposable income, and that income buys washers, dryers, TV sets, cars, etc. - the things that keep our economy going. Payroll tax cuts have an almost immediate effect. BUT - the only problem with that is political. Spending money gives Pelosi and Reid power. Cutting taxes takes away power, and cutting taxes to a power-hungry greed hound like Pelosi is like garlic to a vampire.
As usual Corwin, excellent points. . .and THANKS for your vote [for Scott Brown], even though I reside, still, in Michigan (bwaa, ha, ha, ha!!!). . .but if THE LORD'S willing and the creek don't rise, I'm going to change my residency later this year.
It is not SEC which is broken, it is America. In the last 20 years and especially last 10 years nobody has any interest in real business and producing something to make profit and instead everything has been about stock prices and how to empty pension funds and steal average people savings. USA economy is like a big ship full of holes which is sinking while SEC is a poor sailor who is running around with a bucket of paint, painting the surface rust.
I wouldn't blame everyone - there are good business out there and I've worked with many of them (Ford, for example). But it seems that anyone involved with government has become corrupt. Here is a situation where I find myself completely agreeing with you. Thanks for the terrific analogy, you make the point better than I did
It doesn't look like Barry Obama has changed his ways from the speech that he gave at the State of the Union. Jimmy Carter was the last President that spent the country into double digit inflation. Under Carter the money supply had increased 19% and already under Obama the money supply has increased 29% If people want to gamble in the stock market, I don't really have a problem with that. The big issue is that the pension funds and especially the public pension funds are gambling in the markets. End the end they will be crying to the taxpayers. Already the public pension funds have a $2 trillion deficit.
This has been long before Obama came to office and direct result of "Market Works", "No regulation", "Greed is GOOD" mentality which is preached by Republicans.
Unfortunately he will not be the last. But hey, now Obama can claim the title of being the first "African American" to claim that title.
~ Is this reserved money or newly issued - 29%, I/4+ of the economy is quite a jump that would be hard not to notice or without double digit inflation, and so far the above is not occurring but for Republicans and the economy has turned around and the market is being repaired. ~ Lets hear the Republicans call for real discipline in budget management by freezing defense spending, supposedly their sacred cow, as the real path for manageable budgetry that when push comes to shove they seldom respond accordingly than to press only for changes not affecting their interests.
Um, don't you know you don't freeze defense spending in a time of war? Even President Obama knows that! Besides, what the war on terror has cost for the past NINE YEARS, the Democrats have spent FOUR TIMES that amount in pork spending in the past TWO YEARS. At least the War on Terror has kept us safe. All the Democrats have done with our money is kept their friends in the banks safe by taking money from the middle class and giving it to the wealthiest Americans.
~ In black and white - Obama seems to agree with you. The liberals would both fight the low level wars in the middle east etc. and slash the defense dept. et all and more efficiently manage both. Only by sacrificing everyones sacred cows will any real reform take place and the sooner the better, with everyone on board.
CNBC is reporting that, according to a poll by the Wall Street Journal, Obama's approval rating is now down to 45%: http://www.cnbc.com/id/37884513
Considering the depth of the problems facing congress from the previous Administration and the necessary responses to resolving the issues those numbers are not that discouraging for doing what is right than just getting reelected and in some polls as of yesterday the opposite conclusion - RCP, Real Clear Politics poling had the Democrats in slight favor. The other point to make that is an issue - why put back in power the people who are responsible for the awful conditions that the previous regime created.
Breeze, keep in mind that the current congress was IN CHARGE during the "previous administration". So for once, I guess I have to agree with you.
Real Clear Politics Rating for Obama Job Approval is still +1.1 (47.4 vs 46.3). This is amazing to me. I am normally somewhat cynical and I try to expect very little from human beings, but this evinces a level of ignorance which is beneath and below even my already very low expectations.