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It’s this upcoming 2014 one.. It sets the national stage on whether anything will get done for the next four years. The next president will be powerless to exercise the will of the majority, if the majority party of voters do not vote in their full capacity…
Especially for those under 30. Many of you have parents who are facing retirement and wondering how they will survive. Many of you have parents who are still benefiting of the legacy of your grandparents, who may have left their ample resources to them when they died…
The Grandparents benefited from the New Deal. Your parents were victims of the raw deal. The raw deal which said that if we became conservative, everything would be just rosy.. No details on how, it just would…
Your parents big battle was in 1980… Carter versus Reagan which was a battle not between two men, but over which group of men would get to chart the next 30 years… That thirty years corresponds to your parents from their 20’s to their 50’s…
The two groups of men were the same as the two who battled for dominance under George Washington and have been contentious ever since… The investors versus the People…. When you really benefit the people, you hurt the investors. When you benefit investors, you hurt people… We are currently in an investment-favor phase that began with the election of Reagan in 1980. There are times when both groups benefit accordingly, but moderately. But soon someone always battles to push their side into dominance, and due to the frailty of most politicians, it is usually the moneyed interests which attempt it first…
In your parent’s defense, they’d only seen the New Deal. To them, Reagonomics sounded new, bold, daring and inspired. Little did they think to look at the track record leading up to the New Deal to see how it would unfold. There WAS a reason the New Deal was enacted… Investors care little about people’s woes.
So probably right now, you are looking for work in your field. That field which you put your hard work and dreams into pursuing, only now to be employed waiting tables, or sloshing drinks, or calling up deadbeats in late hours hoping someone picks up the phones… What you are experiencing is the woe felt by countless people across history since the powerful first realized that life at the top is great, only if you suppress those underneath. While you suffer, their investments have made over 100% or more over the past 5 years…
This election is yours… This election settles for YOUR 30 years whether the investors get to keep control, or whether they finally can allow those programs to go forward which cost them money but at the benefit to millions of fellow citizens. Ironically, if America gets richer, they do to, but not as fast if if we give everything to them now…
If you don’t vote, or vote to keep the investors to continue blocking progress, you are setting yourself to 30 years of the same. It doesn’t have to be that way. Your grandparents chose Democrats and Franklin Roosevelt based solely on his promise to better their future with government programs, which the investors forced to foot the bill.
There was nothing wrong with that plan. At the time of Carter’s last years in office, the 1% held their least amount of national wealth EVER. Meaning of course it was split among everyone else… Coal Miners who before the formation of the Union, owed their souls to the company store, literally, were now buying RV’s and boats and taking their kids on vacations across the country… It’s all about who gets the money….
If you don’t vote, and investors win, this will never happen to you. But if you vote in force, and all of your generation, in every state, votes your frustration, you dreams, and your hope for the future, and put thier faith into the party that is there for the people, … then you will succeed over the next 30 years as did your grandparents.
Your grandparents who had nothing, are now sitting pretty. Your parents who had the best any generation has ever had, are now struggling… It was all in their choice of choosing who should lead, between the investors and the people..
The Republican party is there at the behest of the investors. The Democratic party is there for the people… Right now, a minority of investors is stymieing all progress for you and your fellow citizens. Only you can change that…
It’s your grandparents choices versus your parent’s choices…. but it is .. your choice.
Sitting with an accumulation a large number of people gathered for the holidays, and the feature is an old Star Trek move… “The Wrath of “something or other….
Someone surprisingly about 25 years old piques up… “Oh look! It’s that guy from .;… Priceline.!….”
Oh my….
It’s a pun off of the word stagflation which was short for stagnant inflation. Stagpression is short for stagnant depression. It is the most accurate indicator of our economic situation today, and tomorrow, and tomorrow, and tomorrow…
We seem to be in a Depression. but we aren’t. The Housing market is recouping, jobs are consistently growing, energy costs have dropped, corporate profits are now at record, higher than just before the 1929 crash, and an all time record high stock market.. We should be booming. But we aren’t. We still have too high of an unemployment both on and off the books, we still have depressed low wages, we have lost massive wealth within the middle class over this century so far, we have record high student loan debt, we have low consumer confidence, Hence, one class of America is booming. The other class is still in Depression mode. Hence we are in Stagpression….
It is easy to see why.
Here is a chart showing the free cash flow of businesses……
Record highs. See? Record highs. We should be growing faster than China, we have so much investment money at our fingertips. But no.
Here is our investment track record…
Ironically as we gave our businesses more and more money with lower taxes, less regulation, tax funded price supports, hand-tied their unions, and made free new technology at our taxpayers expense, despite all these perks and incentives, they invested less. So what are they doing with their money? Pick up any financial publication and read the headlines. They all will let you know.
None of which help our economy. It is as if we work hard, buy their products, and they put that money into a mattress. Soon, we are going to run out of money. Fortunately the Fed has filled the gap by printing more and giving it to banks for free. It too, filters though the system, and when it gets to the top, it goes into the mattress.
Instead of recycling money, we are letting the tap flow from our printing presses to the top echelon of our society… Now do you get it?
What is missing is a system that recycles the materials back into our economy so we have less money we need to print. If we were talking about paper, we would be saying we need to recycle paper to keep from cutting down more and more trees simply to fill up our landfills….
We need a system to return that money to the bottom so it can rise again and again and again.
Here are the options that have been tried.
- Price and pay freezes.
- Government set and regulated prices.
- Lower tax rates.
- Cash incentives from taxpayers to reinvest.
- Pleas and entreaties from the Oval Office.
- Higher marginal tax rates.
Only one of these has worked. Can you guess which one? If you guessed higher tax rates spur reinvestment you are absolutely correct.
Notice the rates of reinvestment climbing in each of these presidencies: Eisenhower, Kennedy-Johnson, Carter, Clinton each time Congress legislated higher marginal tax rates. Also notice the drops under Nixon, Reagan, and George W. Bush as Republicans cut the taxes… The Bush Tax Cuts held through Obama’s first term, and account for today’s sluggish reinvestment. More precisely, the reinvestment turned upwards under Obama until 2010 when Republicans took over Congress, and has fallen since. I can’t wait to see 2013’s numbers, for I expect to see real investment increase there as well. However those higher tax rates on the top half percent implemented at 2013’s beginning, sent financiers scurrying and bargain empty homes were bought up by investors with lots of cash which brought up the floor of the housing market (perhaps to our future peril). It also accounts for stocks becoming an area of liquidity to hold cash,..explaining the record highs ….
So we have an opposite relationship: cutting taxes increases corporate profits which go elsewhere other than reinvestment back into the ecnomy.
Increasing taxes, cuts into the Free Cash Flow, and funnels some of that flow over to reinvestment projects.
Ever wonder how Delaware’s 3 banks lasted for decades and then all disappeared very close to each other? Bank of Delaware, Delaware Trust, and Wilmington Trust. are now owned by other entities. (Wilmington Trust had some hand in cutting off its own foot). Commerce Bank, which was New Jersey based had the same fate.
They lasted for years because big banks never had enough free money to buy them out. Just think. In Delaware there are now 3 less bank presidents. 18 less bank officers, and who knows how many clerical workers are missing because the work goes to the owners headquarters, not located here…. One still wonders if our state could be better off, had MNBA not been bought up by an outside conglomerate.
So giving more money to businesses and corporations in this case, cost us jobs… and destroyed 3 long termed Delawarean corporations…
That was one example. Across this nation, in every city, every county, every state are millions more….
Raising the tax rates drives re-investment. It is the only thing we know of so far that consistently works to drive re-investment. Everyone who insists on cuts and de-regulation, no matter how they spin it, is pursuing a policy that has been completely disproven by reality and fact and of course, recent history..
Are you better off than you were under Clinton? Your income level will probably determine your answer….. Because yes, some people are indeed, a lot better off. John Carney. Tom Carper. Chris Coons, Jack Markell, to name 4 off the top of my head…. Better off too, are those who these four represent… the 1%. Much better off!
If you find someone willing to raise taxes, stick to them like glue. They are the ones who will lead us back to prosperity…..
Until then, economic stagpression will continue…. continuing through tomorrow, and tomorrow, and tomorrow….(at a) petty pace that creeps from day to day….
The principle statement supporting the implementation of Common Core, has always been that we need a better educated workforce to do tomorrow’s jobs….
Governor Markell said it in his state of the state address on the day the DOW fell 176 points….
This has been a reoccuring theme of his; “the education of today will not bring us the jobs of tomorrow..”
Although that sounds good in soundbyte form, it is not grounded too well in reality. In reality, the wages of jobs have declined as the demand for work rose to become greater than the supply. In other words, unemployment is too high… and that suppresses the cost of labor.
When one’s boss can hire one cheaper to do the same job, that is not the best time to ask your boss for a raise…..
Today, our minimum wage is being paid to college graduates and high school graduates. It used to be paid to those who were either still students, or never did graduate….
Image Courtesy of Economic Policy Institute
Today! Across the minimum workforce almost 5 out of every 10 have a college experience; and almost 8 out of 10 graduated high school or have a GED.
We are already educating our lowest level of workers far above what the job market requires… There are no jobs to be given to those who will soon emerge college or career ready (SAT score over 1550), unless they first fill in the minimum wage jobs these poor blokes working now, give up when they get bumped up into real jobs….
If you bump your newly trained graduates directly into those high paying jobs, then you will be freezing the current generation into these minimum wage level jobs at which they are currently stuck…
One cannot bootstrap a educational process into producing high quality job applicants, when there are no high quality jobs taking applications…
We already have a high quality educated work force; we call it our minimum wage crowd….
So Governor. What are you going to do?
As I see it here are your options….
You have to create an industry here in Delaware. Here is one: wind power infrastructure and solar power grid efficiency. You just make it up and go after it, hoping it doesn’t implode like Fisker and Bloom… The difference is that with Fisker and Bloom, you said “here is some money, do something”; you left it up to them. With this, you get Federal funding and we go government control all the way involving public-private partnerships. We have the land, we have the technical expertise, we have a scientifically educated work force; all we need are capital and someone to direct it.
Secondly, the government needs to create high labor-intensive industries. Areas where humans will not be replaced by robotics. Health care comes to mind. Personal care of senior citizen in their homes, is another. Food inspection is a third. Why can’t we have a public-private enterprise here in Delaware which performs the FDA food inspections for the entire East Coast? Environmental inspection industries is a fourth avenue of opportunity; testing and verification, done by the state to insure compliance of air, water, and soil standards…
As one can tell, these require more taxes. Those who have benefited from the bounce-back of the financial markets, should be the ones to carry the rest of us forward. That would be the 1%. There are two ways to fund our future growth… A) We can borrow and spread the cost over time by increasing our debt and pay it back later, or B) we can pay as we go by assessing more from those in real time, who can afford it without denting their lifestyle…. Being a fiscal conservative, I fall into taxing now, paying now, and keeping our debt levels low.(B).. It makes too much sense to do it any other way….since we currently have an abundance of cash in the hands of the 1% from which to draw.
The point being made through all these wishful plans, is that employment in the private sector is now full. It will not grow more jobs on its own. It is now required of government to prime the pump; we need it more than ever. Most of those currently unemployed will need government jobs to get back to work. There is much to be done to our infrastructure; we have cut government for so long, that many things are close to being broken….
We have an educated work force ready and able. It is our college and high school educated minimum wage earners.... We need to first give them the opportunity to move up into jobs for which they are qualified to do,.. in order to make them better citizens. Playing with education again and again to make more minimum wage workers who are overqualified, is not going to do anyone any good at all… it is just circling money around where it is not needed.
Got this idea from a thread embedded in one of Steve’s posts.
We know the Racino’s are losing money. It is because of competition. Delaware needs a new idea, and Colorado provides the answer…
Of course some will object. Just like everyone originally objected to the idea of gambling ever coming to Delaware…
Gambling is now so entrenched, it is not only a part of our revenue stream, but its owners get concessions from the state itself at the expense of raises to the state employees. Soon, state wages will be replaced by scratch-off cards…..
On the other hand, the revenues from marijuana are amazing. Delaware could pay for one fifth of its state’s educational budget by legalizing and taxing this revenue stream alone.($82 million) However the smart move would be to put all these revenues into an endowment fund for later, Maryland, Pennsylvania, and New Jersey are sure to follow suit as our fumes cross state lines and infiltrate their state halls….. just as they did with casino’s, and eventually that Delaware’s consolidation on that income stream dries up…. But with an endowment, we can keep the benefit filtering in for decades into the future…. “as far as the eye can see.”
Of course, the first word out of the mouths of those politically connected, would be… “what about our friends, the Racino owners?”
And there’s the rub. They benefit too…. In what other state can you gamble and smoke weed at the same time? We’ll have to build new toll lanes just for the traffic trying to get into this state!
As you all know, there are several Supreme Court decisions due this term regarding the ability of corporations or personal businesses to express their religiosity in defiance of the law of the land. One is Hobby Lobby which thinks it should not be required to practice something that is against their religion. The second is today’s “stay” on whether Catholic Organizations have to dispense something their religion completely disavows; birth control.
On one hand we will hear the drums of how religion is being imposed upon by the government. On the other hand we will hear how those employed by these employers, have the right to choice just as do their bosses….
Let us look at the first plank: how religion is being imposed upon by the government. As is been oft repeated, the Constitution as originally written said rather little about the right to religion. However, it IS in the Bill of Rights, which because they were a necessary addition added to get the Constitution garnering enough votes, one can loosely say, the original Constitution deals with religion…
And as is oft repeated with every controversy, the First Amendment states as follows: Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
Congress shall make no law respecting an establishment of religion. This means that Congress cannot say: “This year’s official religion will be Pentecostal. All other religions are hereby abolished”. This may sound far fetched to us, but was a real factor in the daily lives of the colonists before the nation was forged. Quakers were ostracized by Episcopalians. Catholics were beset with punitive laws except in Maryland. If you needed to go before the state or county courthouse, you had to be of that area’s official religion, before you could get heard… True, dat.
The second part, or prohibiting the free exercise thereof; is where the argument will be directed. Hobby Lobby and the Little Sisters of the Poor, both have similar arguments which are as follows.
“WE don’t believe sex should be had for enjoyment. Our religion is anti-sex. If we have to dispense or are required to pay for people to commit sex without the consequence of pregnancy or a viral AIDS infection, we are having our free exercise of religion being prohibited….”
More clearly put: our religion demands that we prohibit sex for enjoyment wherever it “pops” up. If you stop us from prohibiting enjoyable sex, you are interfering with our religion.
In the matter of text, they have a point. If their religion does indeed demand that they stop everyone from having enjoyable sex, then the government in stepping in to stop them from stopping some amazing sex, is depriving them of their religious rights. So we should conceive that they have a textual point….. Before the Obamacare, religion was not impinged. Now it is.
The next step is to see if that point is relevant with the norms of today’s society. As an extreme case, allowing a quirky religious sect to burn their babies alive because “it is called for by their religion” would be a case where the harm done to a citizen of the United States of America against their will, would outweigh in society’s eyes the harm being done to the religiosity of those practicing such a barbarity. Burning witches at a stake would suffice as an example as well.
There is obvious a gray area then where government must trample on religion and religion finds it must interfere with government.
We can use the extreme case above of burning witches. One could say that happened in Delaware in 2010. (lol. Our witch got burned bad.) Here we have a case where one religion (the witch burning one) interferes with the other religion (the witch one). When you have two opposite religions, the government has to look at other laws other than religion to determine policy. In this case, murder. Correct?
So the correct assessment is that since both religious issues cancel each other out, then the factor of murder by default becomes the deciding one. The witch-burning religion is in the wrong by existing laws on the books (murder) and therefore it must stop its practice. Was it’s bizarre form of religion impinged upon by government? Absolutely. And for good reason; it was murder.
So we now have precedence of government making necessary impositions upon any religious practices that harm society. Yet there is still no imposition upon ones beliefs. You can still “believe” that burning witches is your goal in life, but you just can’t carry it out. It hurts other people.
So the defense of the law by the government must not focus on the rights of these religious petitioners. but should solely focus on that harm which if allowed to go forward, that religion will impinge upon all those millions of people who are not in either sect, and who will suffer at the hands of any court decision favoring either sect’s quixotic religious preferences.
They have First Amendment rights too…. such as in having our Government abridging the freedom of speech…
The courts have long upheld that “expression” was the founding father’s meaning of “speech”. Porn doesn’t move it’s lips but is a form of expression protected by the Supreme Court. Just like that Pat Robertson of the 700 Club doesn’t move his lips, but is also considered a form of expression protected by the Supreme Court. Art is expression. Music is expression. Love is expression…
Likewise there are reasonable limits to the right to expression, again, determined by society’s norms. Going nude in a public school is not good. There are reasons that is against the law. Playing music too loud on Newark’s Main Street is not good. There are reasons that is against the law. Graffiti in the Bank of America building, not good. There are reasons that would be against the law.
So the argument made before the court will be two fold; what is harmful or non harmful to each side, and what society’s norms will dictate, whether one or another is extreme when compared to the norm of society….
Therefore this becomes a moral question, not one of logic. After all, both sides think logic is on their side. And I think all will boil down to something said by the last Pope, Pope Benedict….
He stated something along the lines, “that people have to eat; and to eat, they have to work.” If work is abundant, perhaps one can leave one employer and go to another which they prefer. But if work is scarce, they are bound to hang on to that job no matter what external factors line up to batter them. If there is one job in town, and the boss halves the wages, one has to accept it. If there is one job in town, and the boss demands sexual favors for one to keep it, one has to acquiesce because there is no other alternative.
So for every religious nun or Hobby Lobby business owner who wishes to buck the current law, there are those countless employees working for them who will get hurt if their employer gets any exception to the current law simply because their religion states “it” is against all enjoyable sex.
Those employees working for these bosses, can’t have enjoyable sex because of the religiosity of their employers…. ” I’m sorry Hon, but because I work for Hobby Lobby, we can’t do it for another 15 days… Just hold it inside, will you?”
Their expression, in the privacy of their home, is impinged… While yet…the religious owners expression in the privacy of THEIR homes, is not affected by one bit…
Since one side is negatively affected in private by the consequences of not having contraception reimbursed, and the other side is not, it seems imperative that a thoughtful, logical, non-judgmental court, would decide to protect those who are hurt, at the expense of those who are doing the hurting….
Remember: it is still the insurance companies who are paying for all these sexual items; not the employers themselves; there is no harm to the employers if this policy goes forward. They are not in anyway contributing any harm to themselves. Just like if they burned witches….
Those they are affecting, do get harmed…. Not being allowed to enjoy sex because of your luck at being hired by one employer over another, surely trumps whether that employer feels slightly “miffed” that he is required to insure his employees and that insurance will allow them to enjoy the wonders of sex without getting pregnant or getting viral AIDS.
AIDS kills, like being burned at the stake. Being allowed to stand around the fire going “tsk, tsk” should not become our nation’s definition of what “religion” is all about……
Now, to answer why….
“‘Five years after excessive debt propelled a housing-market collapse into a financial crisis and recession, similar bets are being placed across the U.S”.
“Total corporate-bond debt has grown to nearly $6 trillion, up 59% since 2007, the year before the financial crisis. … Leverage by companies rated investment grade has risen 20% since 2010 … about 6% higher than in 2008…
In 2008, mutual funds held, on average, 17% of the bonds and 3% of the loans made to junk-grade companies, according to Bank of America. Today, they own about 26% of the bonds and 19% of the loans.
“Assets in mutual funds and exchange-traded funds that invest in junk bonds have grown to $285 billion in July from $92 billion at the end of 2008,”
“‘Many companies are repeating some of the mistakes of the past,’ by taking on too much debt,…”
“Overall corporate health was ‘no better than it was in 2007 and by some measures worse.”
(All quotes culled from Wall Street Journal)
For those that don’t do this all the time, here is how it works….
You buy $100 million dollars of stock X on margin… You pay 50% of the cost or $50 million, owing the remainder $50 million to your broker. The stock value rises to $150 million and you sell it…. You get the $150 million minus the $50 million owed back to your broker… You pocket an extra $50 million on the $50 million you invested… Your $50 million returned a 100% on your investment, congratulations….
If done in cash, you should have paid $100 million, and gained $50 million when sold at $150 million… Wait … is that the same exact total?… Yes, you are right, but your investment only gained 50%… not 100%
This is why borrowing for stocks is up… Worse than it was in 2007-2008?…. Yes. Correct. Despite the Dodd-Frank bill, it is worse now, than in 2007-2008…..
So then what happens if the price of stocks fall….. ???
You bought $100 million of stocks putting $50 million down and borrowing $50 million from your broker… Rule number one: you broker does not lose: you do….
Stocks fall 2%…. Your value is dropped to $98 million. You now owe the broker $2 million on top of the $50 you put down. Stocks fall again, 2%…. You value drops to $96 million. You know owe your broker an additional $2 million you put down… Getting scared? Sell at $96 million and by the time it goes through, you only get $95 million. Since you owed your broker $50 million and only get $45 million, you immediately cut him a check for $5 million dollars…. You originally put up $50 million so your investment cost you…. 10%….
If you paid cash and put the full $100 million up front, your loss to your company would have only been 5%….
So let us imagine this on the volume of the New York Stock Exchange… Where last Friday on the NYSE, $30 billion traded hands (positively for most, fortunately) … Assuming it was a bad day, and everyone was leveraged, on the minimal 5% drop outlined above, America would have to pay an minimal $1.5 billion to their brokers… In other words… Americans who leveraged, would be $1.5 billion poorer just from the NYSE one day drop alone….
At the 16,000 mark, a 5% drop means the DJIA would rest at 15,200…. or where it was back in the middle of this past October…. just 23 trading days ago….. Because of leveraging, that 5% drop means corporate America takes a 10% clip….
I don’t know if you’ve ever taken a loss of 10%, but if you haven’t… let me tell you… one does cut back on spending….
And that, is what makes this chart so scary……….
(Click image to enlarge)
Makes one understand now exactly why the market-rise continues despite the reality of our current economic situation, doesn’t it? Now…..remember what happened when Bernacke said… “Well, eventually this easing will someday have to end.”?
So….. what to do?
Quietly exit… slowly get off the ice so no one notices…. Just be totally off before all the cracking starts…. and the scrambling begins.
kavips 
