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Posts Tagged ‘Congress’

The Federal Reserve announced yesterday that it was going to pump $1.2 Trillion dollars into the economy by purchasing long-term Treasury Bonds and mortgage securities. Oil prices, which had been hovering around $40 per barrel after bounding off its December 19th low of $32.40, have now increased about 60% from that low and over 20% above the recent average. While many economists do not believe that this new higher price can be sustained in view of the recession induced lower demand, I do not agree.

The Fed’s purchase of bonds and securities represents $1.2 Trillion worth of new dollars into our economy. More dollars competing for the same number of goods is inflationary, as evidenced by the dollar falling yesterday and today against a slew of world currencies. This, coupled with OPEC’s lowered production rates, should keep oil above the $50 mark for quite some time. When our economy begins to recover, that increase in demand should push oil up even further. Since gasoline prices follow oil, but with some delay due to our overabundant supply, expect price averages around $2.50 per gallon in late Spring, with further price surges this Summer to $3.00 – $3.25 per gallon.

When that happens, I’m sure we will see Congress going nuts, and again dragging the oil executives before a committee demanding to know what they are doing about the rising prices in the face of a still weak economy. Calls will emanate to tax their “windfall profits,” and this time they just might succeed. If they do, you can bet the farm that gas will once again hit $4.00 per gallon. Of course, if Obama is able to enact Cap-and-Trade, all energy prices should increase by a minimum of 35% after it takes effect.

No crystal ball, just basic economics. It is just a shame that no one in Congress paid attention in class.

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The President, Congress, and the Media are whipping up the American people into a National Hissy-Fit over AIG’s “bonuses”. Barney Frank wants their names, or he’ll subpoena AIG for them. Chucky-Cheese Schumer has promised to get the money back “one way or another.” The Media is running almost non-stop viewer statements of angry Americans who are apoplectic over these bonuses. I have never seen anything like it (more here). The closest was Congress and the Media beating up on the oil executives over “windfall profits” made at a time when gasoline cost over $4 per gallon.

It is obvious that Tim Geithner, Barney Frank, Chris Dodd, and the President knew about the pay structure of AIG. And these “bonuses” are a part of their pay structure. These are not some monetary version of the “cherry on top”, but are in fact an agreed upon portion of AIG’s payroll. Taxes will be paid on this money, well over a third, and probably half, of this money in fact will return to the Treasury (not the “American Taxpayer” – we will never see a dime). But, in the grand scheme of things – so what?

Congress agreed to bail out AIG. All they needed to do was suspend Mark-to-market accounting that drained AIG’s cash, but instead they handed the insurance giant a few huge checks. Congress did it without strings. Additional funding was provided for in the Stimulus Bill, and provisions included to exempt AIG (and other bailed-out corporations) from restrictions on meeting its payroll obligations. We fought and fought against this bill, however, it passed. Ironically, many – if not most, of the people who supported the Stimulus are now joining in this National Hissy-Fit.

Pardon me for a moment while I say…WE TOLD YOU SO!

Anyway, there is only ONE reason why the President and Congress began this Hissy-Fit. Class warfare. This was absolutely orchestrated and the Media, along with millions of Americans, fell for it hook…line…and sinker. Il Duce wants the average American to be beyond angry at bankers, Wall Street, and companies like AIG. He wants you to be angry at oil companies. He wants you to be jealous of Americans who earn more money than you.

He is playing you like a fiddle my friend.

Obama’s next step will be to subtly change his language to produce a distinction between those who work with their hands for a paycheck, and those who use intellect, or assets, to make a living. Bankers and Wall Street executives are a perfect target. The average American has no idea how the financial market works, nor can they comprehend the amount of money that flows through their hands. It does not matter how much these people work, or sacrificed to obtain their position. It does not matter how much education they have. It does not matter that these people are needed. It does not matter that they are our fellow citizens. To Il Duce, they are the enemy of the common worker, “the people”, and therefore, the State. The original Il Duce, Benito Mussolini, felt the same way and played the same game.

Socialism, and its evil twin Fascism, require that there is a distinction between workers and “the elite”. This distinction becomes a weapon to nationalize our financial institutions. It allows the criminalization of those who took risks with their assets, made loans, or created the widget everyone bought. With criminalization comes seizure of their “ill-gotten” assets to “return them to the American taxpayer.” When that happens, we will no longer be in a Representative Republic. Will will be in a Socialist State. Life in this country will be irrevocably altered, for the worse.

We need to wake up. WAKE UP! Stop giving in to these divisive hissy-fits. Call them what they are and fight to keep our country free. Please, don’t let me, as my last act of defiance before being arrested as a political dissident, type the words…”I TOLD YOU SO!”

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In a recent report by Fox news (link), House Speaker Nancy Pelosi commented that Congress needs to “Keep the Door Open” to yet another grab bag of ridiculous, mind-blowing spending. Apparently, Congress didn’t get everything it wanted out of your wallet, so they’re going to engage in that social taboo called “double dipping.”

Mark Zandi, chief economist and founder of Moody’s Economy, took a more definitive stance than Pelosi, telling reporters a second stimulus bill is necessary.

“We are going to need more taxpayer money … I think another stimulus package is a reasonable assumption because of the way things are going,” Zandi said.

The Obama administration has not ruled out a second stimulus package — should the current bill prove insufficient — but it has not indicated a second bill is currently in the making either.

More money? Are you kidding me? Has anyone in this Congress ever done anything but play with Monopoly money? They flat out have no concept of how the real world works. This has got to stop, but my head is really hurting from pounding it against the wall.

The current Real Clear Politics poll numbers are, for some strange reason, still high for Obama with 60.3% approving of his performance. I guess we know how many people actually watch the news and take enough time out of their busy day to form a cogent thought…the 28.4% that disapprove. Meanwhile, the tide has really turned against Congress. Only 32.7% approve (probably all mouth-breathers), while 55.0% disapprove.

And, since Obama has risen to office, is the country magically on the “right track?” Not according to 56% of the population…which is incidentally a higher percentage than voted for him. Yep, that “Hope and Change” crap is really working out well, huh.

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