Wednesday, October 5, 2011
Peace dividend
As the cold war came to an end something called the Peace Dividend came into play. This was the extra money the government would have when the defense budget was cut. During the Clinton years the military was decreased from 2.1 million to 1.3 million. If we abruptly withdraw the troops from Afghanistan will this add to the unemployment? What jobs will be available for these servicemen. Will the money we save be applied to the deficit (ha) or will it go for more government programs. Will the money we paid the serviceman in salary put him on unemployment and pay for health insurance for some poor family.
Fisa
Just like the changes made by Clinton in the 90’s effected the home mortgage crisis of the past couple of years so did the changes made by the Church Commission of the 70’s effect our military actions of today.
For those who don’t remember the Church committee it was designed to rein in the power of the CIA as they had been caught using illegal tactics investigating US citizens. While this was well and good the committee went on to limit the activities of the CIA in foreign intelligence using the Foreign Intelligence Surveillance Act of 1978 (FISA). It was not designed to effect activities outside the country but it did. The net result was that the CIA people no longer dealt with unsavory characters around the world and in the process lost valuable contacts which led to loss of valuable information.
Fast forward to today. People are questioning why the US did not know about the 9-11 disaster in advance or why we seem to be behind the curve on so many incidences. It is because we cut off our information channels years ago in an attempt to control the activities of the CIA which many thought were unacceptable. Even today the use of drones relies on observers on the ground and this requires that we have troops on the ground. Perhaps if we had more secret contacts we could be using them to find targets instead of our own troops.
Laws that are passed today may have negative effects many years from now. Even something like waterboarding may one day come back to haunt us. While we are taking the high ground today will we one day regret it.
For those who don’t remember the Church committee it was designed to rein in the power of the CIA as they had been caught using illegal tactics investigating US citizens. While this was well and good the committee went on to limit the activities of the CIA in foreign intelligence using the Foreign Intelligence Surveillance Act of 1978 (FISA). It was not designed to effect activities outside the country but it did. The net result was that the CIA people no longer dealt with unsavory characters around the world and in the process lost valuable contacts which led to loss of valuable information.
Fast forward to today. People are questioning why the US did not know about the 9-11 disaster in advance or why we seem to be behind the curve on so many incidences. It is because we cut off our information channels years ago in an attempt to control the activities of the CIA which many thought were unacceptable. Even today the use of drones relies on observers on the ground and this requires that we have troops on the ground. Perhaps if we had more secret contacts we could be using them to find targets instead of our own troops.
Laws that are passed today may have negative effects many years from now. Even something like waterboarding may one day come back to haunt us. While we are taking the high ground today will we one day regret it.
Go along
During the 2010 elections, controversy erupted in the Delaware Republican primary for US Senate. The establishment candidate Michael Castle was challenged by Tea Party favorite Christine O’Donnell. Castle was the going away favorite to win the seat for the Republicans but when O’Donnell defeated him in the primary she was unable to beat the Democrat and the Republicans lost the seat. Establishment experts like former Bush advisor Carl Rove predicted this would happen and they were upset.
I bring this up to point out that most politico gurus want to win the seat regardless of what the candidate stands for and it is this idea I want to examine further. If you are a newly elected official it will not be long before you face your first real dilemma. A situation will arise where your personal beliefs will be in conflict with what your constituents believe. At that point you can either follow your heart and risk not being reelected or go with the crowd and be reelected or you can resign. In most cases the choice is to go with the crowd. The reasoning behind this is that if you are reelected you can have time to bring the crowd around to your way of thinking but if you are not reelected you lose the power that comes with office to make changes.
What happens over time is that you move the crowd slightly in your direction and the crowd moves you a good deal in their direction. The long term result is after many years you have moved so far away from where you started that you no longer have any strong personal convictions. You are always getting reelected but you are just going along to get along. All your bright eyed bushy tailed idealism is long gone and you are just another politician.
I bring this up to point out that most politico gurus want to win the seat regardless of what the candidate stands for and it is this idea I want to examine further. If you are a newly elected official it will not be long before you face your first real dilemma. A situation will arise where your personal beliefs will be in conflict with what your constituents believe. At that point you can either follow your heart and risk not being reelected or go with the crowd and be reelected or you can resign. In most cases the choice is to go with the crowd. The reasoning behind this is that if you are reelected you can have time to bring the crowd around to your way of thinking but if you are not reelected you lose the power that comes with office to make changes.
What happens over time is that you move the crowd slightly in your direction and the crowd moves you a good deal in their direction. The long term result is after many years you have moved so far away from where you started that you no longer have any strong personal convictions. You are always getting reelected but you are just going along to get along. All your bright eyed bushy tailed idealism is long gone and you are just another politician.
Guns
When guns are captured from criminals in Mexico they are examined and if it appears they might be from the US they are sent back to the US. Upon examining these returned guns it appeared that nine out of ten were made in the US. Using this information Hilary Clinton said:
EXCLUSIVE: You've heard this shocking "fact" before -- on TV and radio, in newspapers, on the Internet and from the highest politicians in the land: 90 percent of the weapons used to commit crimes in Mexico come from the United States.
-- Secretary of State Hillary Clinton said it to reporters on a flight to Mexico City.
Later when more facts were available and all guns were checked the number that came from the US was 17%. By that time Hilary had made the argument that the drug problem was just as much the fault of the US as it was the fault of Mexico.
Shortly after that the AFT decided to send US made guns to Mexico hoping to keep track of these guns and lead them to the criminals. The operation was called Fast and Furious and some 2,500 guns were sent into Mexico. Unfortunately the government lost track of the guns and one of them was used to kill a border patrol agents.
There was an attempted cover up and it looks like the head of the ATF will lose his job.
Up to this point what I have stated is factual. Now I will move into speculation. Some people who are biased against Hilary suggest that she encouraged this operation in order to back up her claim that many guns come from the US. We will see how this evolves over the next few weeks. Some have suggested that if the economy continues to trend downward and Obama looks vulnerable that Hilary might challenge him for the nomination in 2012. These same people think that if it looks like Hilary might consider this the Obama administration will leak that it was Hilary who encourage the ATF to move these guns into Mexico. Is this dirty politics or what?
EXCLUSIVE: You've heard this shocking "fact" before -- on TV and radio, in newspapers, on the Internet and from the highest politicians in the land: 90 percent of the weapons used to commit crimes in Mexico come from the United States.
-- Secretary of State Hillary Clinton said it to reporters on a flight to Mexico City.
Later when more facts were available and all guns were checked the number that came from the US was 17%. By that time Hilary had made the argument that the drug problem was just as much the fault of the US as it was the fault of Mexico.
Shortly after that the AFT decided to send US made guns to Mexico hoping to keep track of these guns and lead them to the criminals. The operation was called Fast and Furious and some 2,500 guns were sent into Mexico. Unfortunately the government lost track of the guns and one of them was used to kill a border patrol agents.
There was an attempted cover up and it looks like the head of the ATF will lose his job.
Up to this point what I have stated is factual. Now I will move into speculation. Some people who are biased against Hilary suggest that she encouraged this operation in order to back up her claim that many guns come from the US. We will see how this evolves over the next few weeks. Some have suggested that if the economy continues to trend downward and Obama looks vulnerable that Hilary might challenge him for the nomination in 2012. These same people think that if it looks like Hilary might consider this the Obama administration will leak that it was Hilary who encourage the ATF to move these guns into Mexico. Is this dirty politics or what?
Tea Party
There are many reasons attributed to the rise of the Tea Party but I think they can all be put into one category called corruption. We have politicians who are influenced by lobbyist, we have CEO’s who have huge benefits because the sit on each other’s board and give raises to one another, we have government agencies in bed with the people they regulate, we have Wall Street bankers using inside information to pad their pockets, we have political action committees (PAC’s) using money to influence elections, we have big unions using dues to elect people who will repay them with taxpayer money, and finally we have elected officials who say one thing to get elected and do another thing when in office.
For many years this type of behavior went ahead without challenge but the people finally got fed up and begin to speak up. At first these people were not considered a threat to the establishment when Pelosi referred to them as astroturf, but they soon realized that this group was not business as usual. The 2010 elections were a wakeup call to those in office and the slow economy has more and more people listening to these Tea Partiers. These people do not see themselves as members of a political party but rather as citizens concerned about the overall morality of the country. They believe that the America they grew up with is disappearing and they don’t like it.
For many years this type of behavior went ahead without challenge but the people finally got fed up and begin to speak up. At first these people were not considered a threat to the establishment when Pelosi referred to them as astroturf, but they soon realized that this group was not business as usual. The 2010 elections were a wakeup call to those in office and the slow economy has more and more people listening to these Tea Partiers. These people do not see themselves as members of a political party but rather as citizens concerned about the overall morality of the country. They believe that the America they grew up with is disappearing and they don’t like it.
War poll
Polls show that the American people are getting tired of the war in Afghanistan. I believe the reason for this is a misunderstanding between the civilian leadership and the military leadership. It is up to the President to set out the strategy and the military to determine the tactics. For example, suppose the President would say to the generals that we want to destroy the poppy fields and encourage the farmers to grow food products. The generals would then respond by saying we can do that and we will need 50,000 troops and two years. The failure in Viet Nam was a lack of strategy and we are in the same situation in Afghanistan. Obama told the generals what he wanted them to do and they said they need 60,000 troops and Obama said you can have 30,000 and they accepted that. They should have come back to the President and said if you are only sending half what we need then you must change your strategy. McChrystal tried to do this but the President would not meet privately with him for six months so he went ahead with the 30,000.
This same thing happened in Viet Nam. General Westmoreland asked for 100,000 troops and President Johnson sent 36,000 and the general accepted that. Unless the strategy was changed this was a mistake and we seem to be making the same mistake again.
This same thing happened in Viet Nam. General Westmoreland asked for 100,000 troops and President Johnson sent 36,000 and the general accepted that. Unless the strategy was changed this was a mistake and we seem to be making the same mistake again.
Stimulus
On February of 2009 the Obama administration passed the Stimulus Bill of 787 billion dollars. They predicted that passing this would keep unemployment below 8% but then it went to over 10%. They responded by saying that the economy was worse than they expected even though he had previously stated that the economy was the worst since the Great Depression. Last week the president said that he had created 2 million jobs in the past 15 months and attributed this to the stimulus. Assuming that is true we do the math and discover that each job cost the government $390,000. This does not count the second stimulus called QE2 which passed last November for 600 billion more. If this is the way we create jobs and we currently have 15 million people unemployed we must spend 5 trillion more to get jobs for these people. The fed has printed up 2.5 trillion in the last two years so I guess they could print up another 5 trillion. The reason I am going through this exercise is to point out that the average person does not have to analyze the situation to know that there is something not right about just printing money and handing it out to friends to spend. You can just use your common sense and know that this is going to lead to some serious problems not the least of which is inflation. I know that the average working stiff can see through this charade.
Barney Frank
Barney Frank was in congress when the Community Investment Act was passed. This was one of four Acts passed during the late 70’s and early 80’s that force banks to make home loans to people who were not qualified. These loans were backed by Fannie Mae and Freddie Mac and were designed to make the American Dream of home ownership available to everyone. Frank continued to defend the actions of these two agencies throughout the years preceding the big mortgage crisis of 2008. Once the collapse came and he had to admit his err in judgment he was on TV and here is a quote from that interview:
So, as I waited to be interviewed on a TV show last August, I was surprised and pleased to hear Mr. Frank concede that he had erred: “I hope by next year we’ll have abolished Fannie and Freddie” he said, referring to the two government sponsored enterprises (GSEs), “... it was a great mistake to push lower-income people into housing they couldn’t afford and couldn’t really handle once they had it.” Then he added, “I had been too sanguine about Fannie and Freddie.
The dictionary definition of sanguine is Cheerfully optimistic. That interview was on August of 2010. In the November elections following his admission of bad judgment he was reelected.
On Tuesday, voters in the United States went to the polls for midterm elections. The entire House of Representatives and one-third of the Senate were up for grabs and, when the polls closed, internet gambling champion Barney Frank (D-MA) was reelected by a 54% vote. This was an election when the Republicans won house seats in record numbers
The Congressional Budget Office (CBO) says the real cost of the federal government guaranteeing the business of failed mortgage giants Fannie Mae and Freddie Mac is $317 billion
The top six executives of the two mortgage giants, Fannie Mae and Freddie Mac, received a combined total of $35.4 million during 2009 and 2010
We complain about the corruption in government but we keep reelecting the same people. The above illustrates the money he cost the taxpayers but does not include the pain and suffering inflicted upon all those poor people who were promised their dream home.
So, as I waited to be interviewed on a TV show last August, I was surprised and pleased to hear Mr. Frank concede that he had erred: “I hope by next year we’ll have abolished Fannie and Freddie” he said, referring to the two government sponsored enterprises (GSEs), “... it was a great mistake to push lower-income people into housing they couldn’t afford and couldn’t really handle once they had it.” Then he added, “I had been too sanguine about Fannie and Freddie.
The dictionary definition of sanguine is Cheerfully optimistic. That interview was on August of 2010. In the November elections following his admission of bad judgment he was reelected.
On Tuesday, voters in the United States went to the polls for midterm elections. The entire House of Representatives and one-third of the Senate were up for grabs and, when the polls closed, internet gambling champion Barney Frank (D-MA) was reelected by a 54% vote. This was an election when the Republicans won house seats in record numbers
The Congressional Budget Office (CBO) says the real cost of the federal government guaranteeing the business of failed mortgage giants Fannie Mae and Freddie Mac is $317 billion
The top six executives of the two mortgage giants, Fannie Mae and Freddie Mac, received a combined total of $35.4 million during 2009 and 2010
We complain about the corruption in government but we keep reelecting the same people. The above illustrates the money he cost the taxpayers but does not include the pain and suffering inflicted upon all those poor people who were promised their dream home.
Volt
When I read that GM does not release sales numbers on the Volt I got a little curious and did some research and found out that others were also curious. Several investigations led to the conclusion that May sales were somewhere between 400 and 500. Since the Chevy Cruise sold 22,700 during that same month I wondered why sales of the Volt were so low and did some simple calculations.
I have a Chevy Cobalt and I get 30 miles per gallon. A new Cobalt cost about $14,000.
A new Volt gets 60 miles per gallon and cost $32,000 after the $7,500 government rebate. Since I drive 24,000 miles per year I use 800 gallons of gas. The Volt would use only half that much for a savings of 400 gallons per year or 2,000 gallons in five years. Since the Volt cost $18,000 more than my Cobalt the price of gas would have to be $9 per gallon for me to recap my investment. In five years I have driven 120,000 miles and it would be time to purchase new batteries for my Volt since GM only guarantees them for 100,000 miles. New batteries cost $8,000. This does not include the cost of charging up my Volt every night or more likely for my old brain forgetting to charge.
After careful investigation I have come to the conclusion that I am not ready to dump my Cobalt for a Volt.
I have a Chevy Cobalt and I get 30 miles per gallon. A new Cobalt cost about $14,000.
A new Volt gets 60 miles per gallon and cost $32,000 after the $7,500 government rebate. Since I drive 24,000 miles per year I use 800 gallons of gas. The Volt would use only half that much for a savings of 400 gallons per year or 2,000 gallons in five years. Since the Volt cost $18,000 more than my Cobalt the price of gas would have to be $9 per gallon for me to recap my investment. In five years I have driven 120,000 miles and it would be time to purchase new batteries for my Volt since GM only guarantees them for 100,000 miles. New batteries cost $8,000. This does not include the cost of charging up my Volt every night or more likely for my old brain forgetting to charge.
After careful investigation I have come to the conclusion that I am not ready to dump my Cobalt for a Volt.
Mortgage crisis
I have written before on how the mortgage crisis had its beginning and I would like to expand on that in more detail. Recall that it all began in the 1970’s when it was discovered that mortgage companies were red lining. This means that in certain neighborhoods the income levels were so low that loans were not offered. Bankers would take a red pencil and draw lines around these neighborhoods and did not offer loans to those people. In order to rectify this apparent discrimination the government passed four laws during the 70’s and 80’s. The first was the Home Mortgage Disclosure Act (HMDA) which required banks to report on their loans. I use the term bank when in fact most home loans were provided by Savings and Loan Institutions which today are called bank. Because of this law by 1977 the government had all the information it needed to prove discrimination by banks against poor people. The second was the Community Reinvestment Act (CRA). This law required the banks to make loans to poor people and there were stiff penalties if they did not. In order for banks to comply without losing money they had to find a way to charge more for these loans. Third, the Deregulatory and Monetary Control Act (DIDMCA) was passed in 1980. This allowed banks to charge more for higher risk loans. Forth, in 1982 the Alternative Mortgage Transaction Parity Act (AMTPA) passed and it allowed banks to charge variable interest rates using balloon payments. And with the passage of these four Acts the sub-prime mortgage was born.
It seems that it never occurred to the law makers that banks could not afford to give loans to people who could not repay them. This is the result of law makers who have no business experience. Some of the same law makers who passed the above Acts are now saying that the banks are responsible for the crisis.
So what did the banks do with these loans? They sold them to someone else and said you worry about defaults. This led to the securitization of loans. This means that the loans were bundled together and sold as security investments like mutual funds. These bundles were called Collateralized Debt Obligations (CDO’s). These CDO’s can be bundles of any type but when they contain mortgages they are called Mortgage Backed Securities (MBS’s). In the days before the Acts a banker would meet with the borrower and set up a loan that was based on the ability to pay since the loan would stay in the bank and the bank had a long term interest in the safety of the loan. With the advent of CDO’s this all changed.
During the years when many of these variable loans were sold the interest rate on a 30 year mortgage held in the 5 to 7% range which was historically low and thus allowed many people to take on larger mortgages. Then in 2003 Greenspan started raising the fed fund rates and he raised them 17 times going from 1% to 5.25% which caused the variable home loans to increase by over 4%. What does this look do to the loan? Since the prime rate was 5% and the sub-prime was 10% this now increased each by 4% so the sub-prime went to 14%. You do the math and you will quickly understand why so many poor people had to default. Just another example of the unexpected consequences of good intentions. Isn’t government grand!
It seems that it never occurred to the law makers that banks could not afford to give loans to people who could not repay them. This is the result of law makers who have no business experience. Some of the same law makers who passed the above Acts are now saying that the banks are responsible for the crisis.
So what did the banks do with these loans? They sold them to someone else and said you worry about defaults. This led to the securitization of loans. This means that the loans were bundled together and sold as security investments like mutual funds. These bundles were called Collateralized Debt Obligations (CDO’s). These CDO’s can be bundles of any type but when they contain mortgages they are called Mortgage Backed Securities (MBS’s). In the days before the Acts a banker would meet with the borrower and set up a loan that was based on the ability to pay since the loan would stay in the bank and the bank had a long term interest in the safety of the loan. With the advent of CDO’s this all changed.
During the years when many of these variable loans were sold the interest rate on a 30 year mortgage held in the 5 to 7% range which was historically low and thus allowed many people to take on larger mortgages. Then in 2003 Greenspan started raising the fed fund rates and he raised them 17 times going from 1% to 5.25% which caused the variable home loans to increase by over 4%. What does this look do to the loan? Since the prime rate was 5% and the sub-prime was 10% this now increased each by 4% so the sub-prime went to 14%. You do the math and you will quickly understand why so many poor people had to default. Just another example of the unexpected consequences of good intentions. Isn’t government grand!
Unemployment
They say that the unemployment rate is 9.1% and 15 million people are out of work. What I have not seen is anyone take into account the effect of the baby boomers retiring. Since 10,000 retire every day, they are no longer counted as part of the work force, so they reduce the unemployment rate. If we added them back at 10,000 per day that is 3.65 million per year that would increase the number of unemployed to 18.65 million and the unemployment rate to 11.3%. While these baby boomers are making the social security and Medicare problems worse they are making the unemployment problem look better. I wonder when someone in the press will realize this fact.
Fair
The controversy surrounding the case of Anthony Wiener points out an interesting characteristic of our human nature in that we tend to judge a person’s behavior on the bases of how much we like them. Moral, ethical and legal activities take a back seat to personality. Wiener who sent naked pictures of himself to young women is being asked to resign even though there is precedent to the contrary in the case of former President Clinton. Wiener sent the pictures to several different women on his Face Book site and then when questioned about it proceeded to lie to the public numerous times over a ten day period before finally admitting to the deed. Now fortunately for most of us lying is not a crime. President Clinton, on the other hand, had sexual relations with a young woman, who was working in the White House while he was president. He then said on national television that he did not have sexual relations but it was later proven that she performed oral sex on him. This led to the ridiculous conclusion, that she was having sex with him but he was not having sex with her. He then compounded the problem by saying under oath that he did not have sex with her. Now lying under oath constitutes a crime.
The reason given that Wiener is being treated more harshly than Clinton, is that people generally do not like Wiener but they do like Clinton. This brings me back to the point of human nature. We tend to make allowances for people we like and it goes even further in that people who look presentable tend to get a better reception. Many studies have shown that men who are tall and women who are attractive are looked upon in a favorable manner. Just another example of the many ways that life is not fair. When a child is treated unfairly and dad tried to console him by telling him that life is not fair, he is just getting the child prepared to face the world as it is. When legislators run around passing laws to make life fair they are going up against human nature and more times than not it doesn’t work. How many times have you heard the phrase, “you can’t legislate morality”.
The reason given that Wiener is being treated more harshly than Clinton, is that people generally do not like Wiener but they do like Clinton. This brings me back to the point of human nature. We tend to make allowances for people we like and it goes even further in that people who look presentable tend to get a better reception. Many studies have shown that men who are tall and women who are attractive are looked upon in a favorable manner. Just another example of the many ways that life is not fair. When a child is treated unfairly and dad tried to console him by telling him that life is not fair, he is just getting the child prepared to face the world as it is. When legislators run around passing laws to make life fair they are going up against human nature and more times than not it doesn’t work. How many times have you heard the phrase, “you can’t legislate morality”.
Forest
Sino Forrest is a company that has millions of acres of trees on plantations in China. They have been accused of overstating their inventory, so to calm the waters they have hired Price Waterhouse Accounting to audit their books.
This is another one of those cases that I have referred to in the past where the accounting firm takes the word of the company to determine the value of the company. To review when AXA, a French Company wanted to get into the US life insurance market they offered to invest one billion dollars in Equitable Life of NY. Before doing that they spent 20 million appraising Equitable assets. Does anyone believe that Price Waterhouse is going to count the estimated billions of trees owned by Sino Forrest at a cost of millions or will they just go with the current inventory on the books?
If they just go with the current books then hiring this firm is just a PR stunt and in no way will determine if they are over counting inventory or not. It may calm the fears of ordinary investors but the pros know better. I bring this up to show why ordinary investors should stick to broad based mutual funds since ordinary people do not have the time to look into the accuracy of a company’s inventory data.
This is another one of those cases that I have referred to in the past where the accounting firm takes the word of the company to determine the value of the company. To review when AXA, a French Company wanted to get into the US life insurance market they offered to invest one billion dollars in Equitable Life of NY. Before doing that they spent 20 million appraising Equitable assets. Does anyone believe that Price Waterhouse is going to count the estimated billions of trees owned by Sino Forrest at a cost of millions or will they just go with the current inventory on the books?
If they just go with the current books then hiring this firm is just a PR stunt and in no way will determine if they are over counting inventory or not. It may calm the fears of ordinary investors but the pros know better. I bring this up to show why ordinary investors should stick to broad based mutual funds since ordinary people do not have the time to look into the accuracy of a company’s inventory data.
WW 11
Once in a while, sad to say that it is so rare, I come across a story that makes me proud to be a member of the human race. A man by the name of Felix Zandman was hidden away in a small underground room along with his uncle and two other Jews in Poland during WW 11. The room was so small they had to take turns lying down and deal with their personal modesty as best they could for the 17 months they lived in this tiny space. To pass the time the uncle taught the young Felix higher math by rote. After the war Felix went on to college and later immigrated to the US where he founded an electronics company, Vishay International. He died this week at the age of 83, a self-made billionaire. Have you ever wondered what the other 6 million Jews, who were killed in the Holocaust, might have contributed to the world, had they lived? We all have heard it said that we would never allow this to happen again but things are developing around the world today that cause me concern. I am speaking of the growing sympathy toward the people of Palestine and the threats from some of the Israeli neighbors.
Volt
Here is short but sweet example of American ingenuity resulting in an unexpected consequence based around the good intentions of a government program. It seems that the government is offering a $7,500 tax credit (a credit is money you subtract directly from taxes you owe) so some dealers are buying Volts, taking the credit for themselves and then selling the Volt as a used car with Zero mileage. What a country!
Edwards
The road through life can and usually is bumpy and the case of John Edwards represents a study worth investigating. He was born into a middle class family and was the first member of his family to go to college. He was a good student and continued on through law school. He became a very successful defense attorney and amassed a fortune estimated at 70 million. Later he became a US senator and vice presidential candidate. He married and had 4 children. It was a rags to riches charmed life. He was at the apex of his life when things began to turn around. He wife was dying from cancer when he had a child with a young woman who worked in his office. He denied this but later admitted to the affair. His wife died and he recently was accused of using campaign funds to cover up his affair and is now awaiting trial. All of this is factual and I would like to move into the area of fantasy. There is a place in Matthew where it says that it is easier for a camel to pass through the eye of a needle that it is for a rich man to enter the kingdom of heaven. I believe that if we move 30 years into the future and we see Edwards as an 80 year old looking back on his life that he will say that when he lied about his affair it was the low point of his life and it was a turning point. From that point on he started to understand how life really works and what is really important. He learned after that God doesn’t come into your life through the front door of your ego but through the back door of your shame. At the point where his shame was broadcast on the public airways he felt deep within the beginnings of a new life. As the years past he came to understand that fame and fortune were just phantoms and represented barriers to happiness. It was only after meeting his shame that he began thinking of others and how he could help them and with each passing year he grew into the person he was meant to be. It is not the rich that prevents the rich man from entering a life of happiness but the ego that bloats up when riches come along.
When things are going my way I don’t need anyone. I am self-sufficient and I control my destiny and I am the captain of my ship and I know where I am going and how I will get there. Every one of those I’s in the previous sentence represents the ego. It is only when adversity strikes and misfortune rears her ugly head that I have the opportunity to open my heart to those around me. When my mistakes are made public and my shame is exposed I am on the road to happiness. I may not know it at the time but down the road it will be my salvation. The road of life is filled with strange and unexpected turns. I have faced disappointed many times but in retrospect each was a learning experience.
Back to the real world I believe that Edwards could make a decision to devote the rest of his life to doing pro bono law work for those who cannot afford a top attorney. As the years past and he used his skills to help others his children would slowly regain the respect they once had for him as will those around him.
Presented by Pastor John
When things are going my way I don’t need anyone. I am self-sufficient and I control my destiny and I am the captain of my ship and I know where I am going and how I will get there. Every one of those I’s in the previous sentence represents the ego. It is only when adversity strikes and misfortune rears her ugly head that I have the opportunity to open my heart to those around me. When my mistakes are made public and my shame is exposed I am on the road to happiness. I may not know it at the time but down the road it will be my salvation. The road of life is filled with strange and unexpected turns. I have faced disappointed many times but in retrospect each was a learning experience.
Back to the real world I believe that Edwards could make a decision to devote the rest of his life to doing pro bono law work for those who cannot afford a top attorney. As the years past and he used his skills to help others his children would slowly regain the respect they once had for him as will those around him.
Presented by Pastor John
Medicare
The problem we are encountering with Medicare is the same that we saw with the Bush attempt to fix Social Security. In both situations the cost problem has developed into one of ideology. The Republicans want to privatize the system and the Democrats want to keep these as government plans. As long as they continue to fight this battle ideologically nothing will be done.
I think the Republicans have to concede that now is not the time to privatize. Current Medicare premiums rage from $96.40 per month to $369.10 per month depending on income. The higher amount is for individuals whose income is greater than $200,000 per year. By doing the math it can be shown that there is room for adjustments here. A single person who gets $10,000 per year from social security pays 12% of their income for part B whereas a person who earns $200,000 pays 2.2%. One way to improve the cost problem is to increase the amount paid by higher income people. The second change is to increase the age when people become eligible for Medicare. It was set at age 65 when Medicare was started back in 1965 and has never been changed. This age could gradually be increased as the baby boomers retire.
In addition to the above changes it is also necessary to formally ration benefits. The current Republican plan allows insurance companies to ration and Obama’s plan sets up a committee of 15 government employees to ration. We know that we cannot provide every medical service to every Medicare recipient so the question is how do we ration? The first step is for everyone to understand that we have been rationing health care in both private and public plans for many years and then we can formalize how we ration. Up to now we have been doing this on the sly.
I think the Republicans have to concede that now is not the time to privatize. Current Medicare premiums rage from $96.40 per month to $369.10 per month depending on income. The higher amount is for individuals whose income is greater than $200,000 per year. By doing the math it can be shown that there is room for adjustments here. A single person who gets $10,000 per year from social security pays 12% of their income for part B whereas a person who earns $200,000 pays 2.2%. One way to improve the cost problem is to increase the amount paid by higher income people. The second change is to increase the age when people become eligible for Medicare. It was set at age 65 when Medicare was started back in 1965 and has never been changed. This age could gradually be increased as the baby boomers retire.
In addition to the above changes it is also necessary to formally ration benefits. The current Republican plan allows insurance companies to ration and Obama’s plan sets up a committee of 15 government employees to ration. We know that we cannot provide every medical service to every Medicare recipient so the question is how do we ration? The first step is for everyone to understand that we have been rationing health care in both private and public plans for many years and then we can formalize how we ration. Up to now we have been doing this on the sly.
Economy
During my adult life the economy has gone thru booms and busts and these are known as cyclical business cycles. The standard way to get out of a cyclical recession is to have the government spend more money, called monetary policy and lower taxes, called fiscal policy. This is what we have tried for the past few years and so the question is why hasn’t it worked? The answer is that the problem is not cyclical but it is structural. But what is meant by structural. If I lose my job at the auto factory because there is a slow –down in the economy that is a cyclical change but if people start using mass transit and biking and walking and the demand for cars drops and then I get laid off that is structural. If I lose my job at the car plant because of automation, that is structural. If I lose my job as a tool and die maker because of a computerized robot does my job better at lower cost, that is structural. If I lose my job at the GE plant making light bulbs because they outlawed incandescent in favor of new technology and the new bulbs are made in China that is structural. If I am unemployed because the country needs computer people and I don’t understand computers, that is structural.
Now President Obama has assumed that when he took office we were in the midst of a typical cyclical recession but he was wrong. The typical cures for cyclical downturns is to have the government deficit spend and lower taxes which is what was down but it didn’t work because we have a structural problem. It is like prescribing antibiotics for a viral infection. You can’t get there from here.
The solution to our current economic problem is to remove government restrictions on business, starting with getting rid of all the Czars we have, getting rid of Obama care, stop printing money and stop spending money. The sooner the government gets out of the way, the sooner businesses will feel comfortable about expanding and creating jobs.
Once we have job creation all of the other problems will start to go away. The president must understand that we cannot spend our way out of a structural downturn. In simple terms what we need is smaller less intrusive government.
Now President Obama has assumed that when he took office we were in the midst of a typical cyclical recession but he was wrong. The typical cures for cyclical downturns is to have the government deficit spend and lower taxes which is what was down but it didn’t work because we have a structural problem. It is like prescribing antibiotics for a viral infection. You can’t get there from here.
The solution to our current economic problem is to remove government restrictions on business, starting with getting rid of all the Czars we have, getting rid of Obama care, stop printing money and stop spending money. The sooner the government gets out of the way, the sooner businesses will feel comfortable about expanding and creating jobs.
Once we have job creation all of the other problems will start to go away. The president must understand that we cannot spend our way out of a structural downturn. In simple terms what we need is smaller less intrusive government.
Chrysler
Yesterday Vice President Biden announced that Chrysler had repaid its government loan so I was somewhat suspicious. Here is a recent news item.
No one was really surprised that Chrysler posted a quarterly profit — a modest $116 million — this year, technically its first since exiting bankruptcy in 2009, but really the first time it’s been in the black since the mid-2000s.
Now I wondered how they could pay off a 7 billion dollar loan so I looked further into the matter and discovered that Fiat had increased its ownership from 20% to 46% so I figured that Chrysler got the money from Fiat. Now there are 650 million shares of outstanding Chrysler stock and it is values at $8 per share so the book price of the entire company is about 5 billion. If Fiat bought 26% of that it would only inject about 1.2 billion so how could they pay off 7 billion.
Here is another quote:
The Obama administration’s bailout agreement with Fiat gave the Italian car company a “Incremental Call Option” that allows it to buy up to 16% of Chrysler stock at a reduced price. But in order to exercise the option, Fiat had to first pay back at least $3.5 billion of its loan to the Treasury Department. But Fiat was having trouble getting private banks to lend it the money. Enter Obama Energy Secretary Steven Chu who has signaled that he will approve a fuel-efficient vehicle loan to Chrysler for … wait for it … $3.5 billion.
But wait there is more:
So, to recap, the Obama Energy Department is loaning a foreign car company $3.5 billion so that it can pay the Treasury Department $7.6 billion even though American taxpayers spent $13 billion to save an American car company that is currently only worth $5 billion.
Oh, and Obama plans to make this “success” a centerpiece of his 2012 campaign.
More smoke and mirrors. Will the American people ever catch on?
No one was really surprised that Chrysler posted a quarterly profit — a modest $116 million — this year, technically its first since exiting bankruptcy in 2009, but really the first time it’s been in the black since the mid-2000s.
Now I wondered how they could pay off a 7 billion dollar loan so I looked further into the matter and discovered that Fiat had increased its ownership from 20% to 46% so I figured that Chrysler got the money from Fiat. Now there are 650 million shares of outstanding Chrysler stock and it is values at $8 per share so the book price of the entire company is about 5 billion. If Fiat bought 26% of that it would only inject about 1.2 billion so how could they pay off 7 billion.
Here is another quote:
The Obama administration’s bailout agreement with Fiat gave the Italian car company a “Incremental Call Option” that allows it to buy up to 16% of Chrysler stock at a reduced price. But in order to exercise the option, Fiat had to first pay back at least $3.5 billion of its loan to the Treasury Department. But Fiat was having trouble getting private banks to lend it the money. Enter Obama Energy Secretary Steven Chu who has signaled that he will approve a fuel-efficient vehicle loan to Chrysler for … wait for it … $3.5 billion.
But wait there is more:
So, to recap, the Obama Energy Department is loaning a foreign car company $3.5 billion so that it can pay the Treasury Department $7.6 billion even though American taxpayers spent $13 billion to save an American car company that is currently only worth $5 billion.
Oh, and Obama plans to make this “success” a centerpiece of his 2012 campaign.
More smoke and mirrors. Will the American people ever catch on?
Tax and spend
As the elected officials in Washington debate how they will solve the budget problems we are faced with two arguments. The Democrats say we must cut spending and raise the tax rates but the Republicans say cut spending and reform the tax laws. Obama wants to raise taxes on those making more than $200,000 and use that money to invest (spend) on education and infrastructure. This is what we used to call tax and spend. His theory is that by spending this money we will cause the economy to grow. We know that the so called shovel ready projects are not ready. It takes years to get environmental approval and planning can only start after these approvals. As far as spending on education this may keep some teachers from getting laid off but there are good reasons to doubt that spending more will improve education.
On the other side there is evidence that shows when you increase taxes on those who provide jobs you slow down the economy. I believe both sides concur that reforming the existing tax law can help. When large corporations pay zero tax it is not because the tax rate is too low it is because there are too many loopholes in the tax code. We could easily lower the corporation tax rate from the current 35% to 25% and eliminate the loopholes and end up with more revenue.
The question remains, is it better for the economy if the government spends our money or is it better if we spend our money. Remember that taxation is merely the transfer of money from one group of people to another group with the government deciding who gets what and from whom. If you are a cynic you see it as taking money from those who earn it and giving it to those who don’t. Most people realize that there are times in the lives of people that they need help and most are ready to give help but when it gets to the point of more people in the wagon than pulling the wagon then no one is helped. Currently there are 310 million people in the US and 40 million receive food stamps, 10 million get unemployment benefits, 58 million on Medicaid and 52 million on social security and if you do the math you see there are more in the wagon than pulling the wagon.
Wake up people!
On the other side there is evidence that shows when you increase taxes on those who provide jobs you slow down the economy. I believe both sides concur that reforming the existing tax law can help. When large corporations pay zero tax it is not because the tax rate is too low it is because there are too many loopholes in the tax code. We could easily lower the corporation tax rate from the current 35% to 25% and eliminate the loopholes and end up with more revenue.
The question remains, is it better for the economy if the government spends our money or is it better if we spend our money. Remember that taxation is merely the transfer of money from one group of people to another group with the government deciding who gets what and from whom. If you are a cynic you see it as taking money from those who earn it and giving it to those who don’t. Most people realize that there are times in the lives of people that they need help and most are ready to give help but when it gets to the point of more people in the wagon than pulling the wagon then no one is helped. Currently there are 310 million people in the US and 40 million receive food stamps, 10 million get unemployment benefits, 58 million on Medicaid and 52 million on social security and if you do the math you see there are more in the wagon than pulling the wagon.
Wake up people!
Medicare Medicaid
The two sides have staked out their claims on how to solve the problem with Medicare and they are both right so regardless of which way we go we will begin to make some headway. The Obama plan is to set up a government committee of 12 members who will decide what treatments are available. The Ryan plan offers vouchers to people who can then purchase a plan through a group of private insurers. Both of these approaches use rationing to reduce cost and that is the only logical way to go. Whenever any benefit is reduced or eliminated there will be good arguments as to why this particular procedure should be allowed but as time passes people will realize that this is the only way to save the program. It comes down to the simple fact that everyone cannot have every procedure that is medically available and someone or some insurance company will have to make these tough choices. Unbeknownst to most people this process of rationing has been going on for many years in both Medicare and private insurance. Last year when the phrase “Death Panels” was coined everyone panicked but upon further evaluation it was revealed that by the way that doctors present options the idea of dying with dignity was often chosen over life extending treatments. It is time for people to grow up and face the fact that there is not enough money to do everything for everyone. Once both political parties have the courage to explain this quandary to their constituents we will begin to take the necessary steps to save Medicare. Let’s hope this happens before the whole program goes down the drain, which by the way is currently scheduled for 2018.
Since Medicaid is financed with ongoing funds from the federal and state governments there is no date when it will go broke but it faces the same cost problems that Medicare does and the same cure will be needed. We must ration. This is a very difficult problem since about one in four Medicaid recipients are in eldercare facilities. There is new technology available that can keep many of these people in their homes. For about $10,000 most houses can have the bath modified to accept people in wheel chairs. Instead of paying out $7,000 per month to stay in a care facility many people can stay in their homes where they would rather be. This is only one example. In the future it may be necessary that families take on more responsibility as they did not that many years ago. People who use Medicaid for their health insurance will have to face rationing just as others in private insurance will face.
Since Medicaid is financed with ongoing funds from the federal and state governments there is no date when it will go broke but it faces the same cost problems that Medicare does and the same cure will be needed. We must ration. This is a very difficult problem since about one in four Medicaid recipients are in eldercare facilities. There is new technology available that can keep many of these people in their homes. For about $10,000 most houses can have the bath modified to accept people in wheel chairs. Instead of paying out $7,000 per month to stay in a care facility many people can stay in their homes where they would rather be. This is only one example. In the future it may be necessary that families take on more responsibility as they did not that many years ago. People who use Medicaid for their health insurance will have to face rationing just as others in private insurance will face.
Mortgage crisis
One of the main reasons that the mortgage fiasco was so big is that it was allowed to develop even though many people warned that there were serious problems. Every time someone or some agency challenged the easy access to a home mortgage they were shot down by accusing them of not wanting poor people to participate in the American Dream of home ownership. The biggest advocates for the loose requirements for home loans were liberals who wanted to help the poor. One of these was Barney Frank, who chairs the House Financial Services Committee, the congressional committee whose job is to oversee the mortgage business. For more than ten years Frank defended mortgage giant Fanny Mae against attacks by promising to make it easier for low income people to get loans.
One group that regularly investigated Fanny Mae was the Office of Federal Housing Enterprise Oversight (OFHEO). Now I would be willing to cut Barney some slack during the early years as this problem developed but at some point he had to know that things were not right. Yet in late 2010, two years after the whole thing blew up, he was asked why he always defended Fanny Mae and he said that he thought the problem was just an adversarial relationship between the regulators at OFHEO and Fanny. This is a very revealing statement as most people would expect there to be or would demand that there be tension between the regulators and the regulated. Frank had been in bed with Fanny for so many years he could not break away even after they were proven to be corrupted.
Lest we just want to blame our elected officials be advised that Frank easily won re-election after the scandal was made public and he is now serving his 31st year in congress.
The people who have been most hurt by the collapse of the housing market were the very poor people that Frank set out to help. This same result has happened over and over since the start of the Great Society which was supposed to help the poor but has time after time hurt more than it helped. This has not deterred liberals from continuing to propose government programs that will help (?) the poor. One more example of the unintended consequence of good intentions.
One group that regularly investigated Fanny Mae was the Office of Federal Housing Enterprise Oversight (OFHEO). Now I would be willing to cut Barney some slack during the early years as this problem developed but at some point he had to know that things were not right. Yet in late 2010, two years after the whole thing blew up, he was asked why he always defended Fanny Mae and he said that he thought the problem was just an adversarial relationship between the regulators at OFHEO and Fanny. This is a very revealing statement as most people would expect there to be or would demand that there be tension between the regulators and the regulated. Frank had been in bed with Fanny for so many years he could not break away even after they were proven to be corrupted.
Lest we just want to blame our elected officials be advised that Frank easily won re-election after the scandal was made public and he is now serving his 31st year in congress.
The people who have been most hurt by the collapse of the housing market were the very poor people that Frank set out to help. This same result has happened over and over since the start of the Great Society which was supposed to help the poor but has time after time hurt more than it helped. This has not deterred liberals from continuing to propose government programs that will help (?) the poor. One more example of the unintended consequence of good intentions.
Rubin
In the past I have discussed the China Wall. This was one of the first things I learned when I got into the financial business. It is a fictitious wall that separated banks into the commercial side and the investment side. The idea is the employees on side should not discuss business with the other side since the commercial side might be tempted to invest customer funds in businesses represented by the investment side. This is what happened in the 20’s and the banks went broke when businesses failed. A law was passed in the 30’s to prevent this from happening again. The law was named after its sponsors Senator Glass and Congressman Steagall. For many years various interested parties tried to repeal Glass-Steagall and in 1999 they succeeded.
The CEO of Travelers Insurance Sanford Weill wanted to merge with Citibank which was run by John Reed but they needed to get rid of Glass-Steagall to allow such a merger. Weill was a mover and shaker and had influence with Fed Chairman Alan Greenspan and Treasury Secretary Robert Rubin and so with their help he was able to push through the repeal. The new company was called Citigroup and was the biggest merger in US history and became the largest financial institution in the world.
Now here is the interesting part. Rubin left the government and got a job with Citicorp and over the next ten years he was paid $115 million while he helped to run the company into the ground.
Here is a quote from the new media:
Rubin made at least $115 million (plus stock options) between 1999 and 2008, before the feds had to inject $45 billion and then guarantee $300 billion of the firm's liabilities to keep the place afloat.
Rubin told the Wall Street Journal in November 2008 that he was worth every penny -- and then some. "I bet there's not a single year where I couldn't have gone somewhere else and made more," he said.
Is this a great country or what!
The CEO of Travelers Insurance Sanford Weill wanted to merge with Citibank which was run by John Reed but they needed to get rid of Glass-Steagall to allow such a merger. Weill was a mover and shaker and had influence with Fed Chairman Alan Greenspan and Treasury Secretary Robert Rubin and so with their help he was able to push through the repeal. The new company was called Citigroup and was the biggest merger in US history and became the largest financial institution in the world.
Now here is the interesting part. Rubin left the government and got a job with Citicorp and over the next ten years he was paid $115 million while he helped to run the company into the ground.
Here is a quote from the new media:
Rubin made at least $115 million (plus stock options) between 1999 and 2008, before the feds had to inject $45 billion and then guarantee $300 billion of the firm's liabilities to keep the place afloat.
Rubin told the Wall Street Journal in November 2008 that he was worth every penny -- and then some. "I bet there's not a single year where I couldn't have gone somewhere else and made more," he said.
Is this a great country or what!
Democracy
A man by the name of Alexander Tyler is credited with saying
"A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship."
I realize we have a Representative Republic and not a Democracy but the idea intrigues me because in the next election we will find out if the people are wise enough to vote to limit their benefits or will they chose to spend us into bankruptcy.
"A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship."
I realize we have a Representative Republic and not a Democracy but the idea intrigues me because in the next election we will find out if the people are wise enough to vote to limit their benefits or will they chose to spend us into bankruptcy.
Socialism
I often hear people say that Obama is leading us toward socialism so I looked up the definition of Socialism.
Socialism is an economic system characterized by public ownership and centralized planning of all major industries (manufacturing, services, and energy), banks and insurance companies, agribusiness, transportation, the media, and medical facilities.
As I read that I am astounded that so called educated people believed that such a system would work. I will let my imagination run wild and set up a socialist type of country. First the government owns everything so they can agree to pay everyone the same salary regardless of what the job entails. Brain surgeons and CEO’s make the same as garbage collectors and janitors. That is easy enough to do although it begs the question as to why someone would go through all the training for no extra salary but this is not the tough part. How does the government decide on how many surgeons and how many janitors are needed and then how do they decide who will assume those positions. Next take production of goods and services. How many cars and how many clerks are needed and once again who are these people and how are they selected. Finally who decides who does the selecting?
It is obvious to me that such a system as pure socialism cannot exist in the real world but partial socialism is what most people refer to when they say Obama is tending toward socialism. The argument is how far toward socialism do we want to go. For all of my life the federal government has been assuming more responsibility. It appears that we are at a crossroad and the pendulum is beginning to swing back. Will the people who have become accustom to Big Brother be willing to give up some of their benefits and take on more personal responsibility? We will find out in November 2012
Socialism is an economic system characterized by public ownership and centralized planning of all major industries (manufacturing, services, and energy), banks and insurance companies, agribusiness, transportation, the media, and medical facilities.
As I read that I am astounded that so called educated people believed that such a system would work. I will let my imagination run wild and set up a socialist type of country. First the government owns everything so they can agree to pay everyone the same salary regardless of what the job entails. Brain surgeons and CEO’s make the same as garbage collectors and janitors. That is easy enough to do although it begs the question as to why someone would go through all the training for no extra salary but this is not the tough part. How does the government decide on how many surgeons and how many janitors are needed and then how do they decide who will assume those positions. Next take production of goods and services. How many cars and how many clerks are needed and once again who are these people and how are they selected. Finally who decides who does the selecting?
It is obvious to me that such a system as pure socialism cannot exist in the real world but partial socialism is what most people refer to when they say Obama is tending toward socialism. The argument is how far toward socialism do we want to go. For all of my life the federal government has been assuming more responsibility. It appears that we are at a crossroad and the pendulum is beginning to swing back. Will the people who have become accustom to Big Brother be willing to give up some of their benefits and take on more personal responsibility? We will find out in November 2012
Jews
The United States is considered by many as a Judeo-Christian country. While many
Christians believe this, they often forget that the Old Testament is the history of the Jews. If I had to sum up the Old Testament in one sentence, I would say that it is a written record of the Jews searching for the promise land. More than 3000 years ago when Moses, led the Jews out of more than 400 years of slavery in Egypt, the first place he headed was for the promise land. Where is the promise land? It is that area that lies between the rivers Nile and Euphrates and the center of this is the old land of Canaan which is located in and around the present city of Jerusalem.
The Jews basically stayed in this area until about 2500 years ago when the city of Jerusalem was destroyed by the Babylonian army and the Jews were exiled to what is present day Iraq. During the 200 years they remained in Iraq the area around Jerusalem was controlled by many different groups including Persians, who allowed the Jews to return to the promise land
The Jews never had a country and for the next 2000 years they migrated to different parts of the western world where they were treated as second class people. At first it was because of their religion but later it turned into prejudice against them as a race and this was called anti-Semitism. This continued well into the 19th century when the idea of a Jewish homeland called Zionism came into being.
About 100 years ago the area in and around Jerusalem became known as Palestine and some wealthy Jewish businessmen in Europe begin to sponsor settlements in Palestine for Jews.
After WW1 Zionism attracted the interest of many in Europe as a way a getting rid of the Jews and after WW11 the Jews were granted statehood and the country of Israel was founded in 1948 and the Jews finally had a home in the promise land
Christians believe this, they often forget that the Old Testament is the history of the Jews. If I had to sum up the Old Testament in one sentence, I would say that it is a written record of the Jews searching for the promise land. More than 3000 years ago when Moses, led the Jews out of more than 400 years of slavery in Egypt, the first place he headed was for the promise land. Where is the promise land? It is that area that lies between the rivers Nile and Euphrates and the center of this is the old land of Canaan which is located in and around the present city of Jerusalem.
The Jews basically stayed in this area until about 2500 years ago when the city of Jerusalem was destroyed by the Babylonian army and the Jews were exiled to what is present day Iraq. During the 200 years they remained in Iraq the area around Jerusalem was controlled by many different groups including Persians, who allowed the Jews to return to the promise land
The Jews never had a country and for the next 2000 years they migrated to different parts of the western world where they were treated as second class people. At first it was because of their religion but later it turned into prejudice against them as a race and this was called anti-Semitism. This continued well into the 19th century when the idea of a Jewish homeland called Zionism came into being.
About 100 years ago the area in and around Jerusalem became known as Palestine and some wealthy Jewish businessmen in Europe begin to sponsor settlements in Palestine for Jews.
After WW1 Zionism attracted the interest of many in Europe as a way a getting rid of the Jews and after WW11 the Jews were granted statehood and the country of Israel was founded in 1948 and the Jews finally had a home in the promise land
Spending
There is a lot of talk about the deficit and looking back we can see some interesting things if we compare the 8 Reagan years 1981 through 1989 and the 8 years of Clinton 1994 through 2001. During the Reagan years revenues increased by 6.1% per year and spending increased by 5.5%. During the Clinton years revenues increased by 5.9% but spending increased by only 3.1%. Reagan ended up with a deficit and Clinton with a surplus and the major difference was in spending. The reason for this is that Reagan for most of his time had a Republican congress who did not try to hold the line on spending but Clinton had a Republican congress which fought against spending.
More recently with George Bush and a Republican congress and Obama with a Democrat congress spending has sky rocketed. Since party trumps county no congress wants to spend money if the President is in the opposite party since they don’t want the President to get credit. It appears the country is better off when the President is in one party and the congress in the other party
More recently with George Bush and a Republican congress and Obama with a Democrat congress spending has sky rocketed. Since party trumps county no congress wants to spend money if the President is in the opposite party since they don’t want the President to get credit. It appears the country is better off when the President is in one party and the congress in the other party
Missouri
A friend sent me this interesting piece and check out the source at the bottom
Missouri has no problem with illegals, go figure...won't be too difficult......
Missouri's approach to the problem of illegal immigration appears to be more advanced, sophisticated, strict and effective than anything to date in Arizona .
Do the loonies in San Francisco , or the White House, appreciate what Missouri has done? When are our fearless President and his dynamic Attorney General going to take action to require Missouri start accepting illegal immigrants once again? So, why doesn't Missouri receive attention?
Answer: There are no Mexican illegals in Missouri to demonstrate.The "Show Me" state has once again shown us how it should be done. There needs to be more publicity and exposure regarding what Missouri has done.
In 2007, Missouri placed on the ballot a proposed constitutional amendment designating English as the official language of Missouri . In November, 2008, nearly 90% voted in favor! Thus, English became the official language for ALL governmental activity in Missouri . No individual has the right to demand government services in a language OTHER than English.
In 2008, a measure was passed that required the Missouri Highway Patrol and other law enforcement officials to verify the immigration status of any person arrested, and inform federal authorities if the person is found to be in Missouri illegally. Missouri law enforcement officers receive specific training with respect to enforcement of federal immigration laws.
In Missouri , illegal immigrants do NOT have access to taxpayers benefits such as food stamps and health care through Missouri HealthNET.
In 2009, a measure was passed that ensures Missouri 's public institutions of higher education do NOT award financial aid to individuals who are illegally in the United States ..
In Missouri , all post-secondary institutions of higher education to annually certify to the Missouri Dept. of Higher Education that they have NOT knowingly awarded financial aid to students who are unlawfully present in the United States .
So, while Arizona has made national news for its new law, it is important to remember, Missouri has been far more proactive in addressing this horrific problem Missouri has made it clear that illegal immigrants are NOT welcome in the state and they will certainly NOT receive public benefits at the expense of Missouri taxpayers
Taken from: "The Ozarks Sentinel" Editorial - Nita Jane Ayres, May 13, 2010. If the link does not work, just type in "The Ozarks Sentinel - Nita Jane Ayres" in Google. Here is the link to confirm: Be sure to read the reader comments too.
http://www..ozarkssentinel.com/missouri-ahead-of-the-game-in-dealing-with-illegal-immigrants-p1034.htm
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Missouri has no problem with illegals, go figure...won't be too difficult......
Missouri's approach to the problem of illegal immigration appears to be more advanced, sophisticated, strict and effective than anything to date in Arizona .
Do the loonies in San Francisco , or the White House, appreciate what Missouri has done? When are our fearless President and his dynamic Attorney General going to take action to require Missouri start accepting illegal immigrants once again? So, why doesn't Missouri receive attention?
Answer: There are no Mexican illegals in Missouri to demonstrate.The "Show Me" state has once again shown us how it should be done. There needs to be more publicity and exposure regarding what Missouri has done.
In 2007, Missouri placed on the ballot a proposed constitutional amendment designating English as the official language of Missouri . In November, 2008, nearly 90% voted in favor! Thus, English became the official language for ALL governmental activity in Missouri . No individual has the right to demand government services in a language OTHER than English.
In 2008, a measure was passed that required the Missouri Highway Patrol and other law enforcement officials to verify the immigration status of any person arrested, and inform federal authorities if the person is found to be in Missouri illegally. Missouri law enforcement officers receive specific training with respect to enforcement of federal immigration laws.
In Missouri , illegal immigrants do NOT have access to taxpayers benefits such as food stamps and health care through Missouri HealthNET.
In 2009, a measure was passed that ensures Missouri 's public institutions of higher education do NOT award financial aid to individuals who are illegally in the United States ..
In Missouri , all post-secondary institutions of higher education to annually certify to the Missouri Dept. of Higher Education that they have NOT knowingly awarded financial aid to students who are unlawfully present in the United States .
So, while Arizona has made national news for its new law, it is important to remember, Missouri has been far more proactive in addressing this horrific problem Missouri has made it clear that illegal immigrants are NOT welcome in the state and they will certainly NOT receive public benefits at the expense of Missouri taxpayers
Taken from: "The Ozarks Sentinel" Editorial - Nita Jane Ayres, May 13, 2010. If the link does not work, just type in "The Ozarks Sentinel - Nita Jane Ayres" in Google. Here is the link to confirm: Be sure to read the reader comments too.
http://www..ozarkssentinel.com/missouri-ahead-of-the-game-in-dealing-with-illegal-immigrants-p1034.htm
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67 borders
Today President Obama laid out his view of the Middle East and in a surprise said that Israel should go back to the 1967 borders. In 2004 President Bush said the US would not require Israel to do this and a letter to that effect was sent to congress and 75% of the house members and 75% of the senate signed the letter. This was not an agreement made with Bush and the congress but it was made with the United States government.
In Israel’s 70 years history there have been 5 wars with the Arabs and Israel won all five. In each war they captured Arab territories and later gave back the territories. After the 67 war they kept certain territories so they could defend themselves against future attacks. If Israel goes back to the 67 borders the Arab border will be only five miles from the capital of Tel Aviv.
It has always been expected that one day Israel would be willing to negotiate a return to these borders when they could be assured they would not be attacked. In addition Israel would demand that the Palestinians give up the right of return. These is the idea that all Palestinians that lived in what is now Israel in 1948 when Israel became a state had the right to return to Israel and reclaim their property and be citizens of Israel. Since there are fewer than 5 million Jews in Israel and there would be 6 million Palestinians returning that would be the end of Israel because these people returning would have the rights of citizens and the right to vote. The very next election they would vote all the Jews out of the country and that would be the end of Israel.
The interesting thing about this right of return is that throughout history this right has been reserved only to those who were displaced and not their progeny. Since this occurred in 1948 most of these people are dead and it would make no difference but the UN has ruled in this case that it is the refugees and their progeny who could return.
As a reminder when the Jewish state was created in 1948 there were about a half million Jews living in that area and about a half million Arabs. In the days preceding the war all of these Arabs moved out of the area and about an equal number of Jews who were living in Arab lands moved into Israel. The war then began with forces from Egypt, Syria, Jordan, Iraq, Lebanon, Saudi Arabia and Palestine attacking Israel. Their plan was to drive Israel into the sea but instead Israel defeated these armies, something which would repeat itself in four more wars.
Each time the Arabs were humiliated their hatred toward the Jews increased and today they would like nothing better, as the leader of Iran says, to wipe Israel off the map. Another disturbing aspect is the fact that two days ago the Jews were told there would be no mention of the 67 borders but today it came out just one day before the head of Israel is schedule to visit the White House. When Netanyahu visited Obama last year he was made to sit and wait while the President ate dinner which was considered a slap in the face and some say this is no way to treat an ally.
In Israel’s 70 years history there have been 5 wars with the Arabs and Israel won all five. In each war they captured Arab territories and later gave back the territories. After the 67 war they kept certain territories so they could defend themselves against future attacks. If Israel goes back to the 67 borders the Arab border will be only five miles from the capital of Tel Aviv.
It has always been expected that one day Israel would be willing to negotiate a return to these borders when they could be assured they would not be attacked. In addition Israel would demand that the Palestinians give up the right of return. These is the idea that all Palestinians that lived in what is now Israel in 1948 when Israel became a state had the right to return to Israel and reclaim their property and be citizens of Israel. Since there are fewer than 5 million Jews in Israel and there would be 6 million Palestinians returning that would be the end of Israel because these people returning would have the rights of citizens and the right to vote. The very next election they would vote all the Jews out of the country and that would be the end of Israel.
The interesting thing about this right of return is that throughout history this right has been reserved only to those who were displaced and not their progeny. Since this occurred in 1948 most of these people are dead and it would make no difference but the UN has ruled in this case that it is the refugees and their progeny who could return.
As a reminder when the Jewish state was created in 1948 there were about a half million Jews living in that area and about a half million Arabs. In the days preceding the war all of these Arabs moved out of the area and about an equal number of Jews who were living in Arab lands moved into Israel. The war then began with forces from Egypt, Syria, Jordan, Iraq, Lebanon, Saudi Arabia and Palestine attacking Israel. Their plan was to drive Israel into the sea but instead Israel defeated these armies, something which would repeat itself in four more wars.
Each time the Arabs were humiliated their hatred toward the Jews increased and today they would like nothing better, as the leader of Iran says, to wipe Israel off the map. Another disturbing aspect is the fact that two days ago the Jews were told there would be no mention of the 67 borders but today it came out just one day before the head of Israel is schedule to visit the White House. When Netanyahu visited Obama last year he was made to sit and wait while the President ate dinner which was considered a slap in the face and some say this is no way to treat an ally.
Fairness
President Obama has been using the words fair or fairness in pursuit of his tax increase on those making more than $200,000 per year. I believe that in a free market capitalist system the concept of fairness seems woefully out of place. For example if Bill Gates needs brain surgery he will go to the finest facility in the world, and his bed will be surrounded by a half dozen of the world’s finest brain surgeons. Any and all equipment needed, will be made available and no expense will be spared. If the operation cost 50 million it will be paid for up front in cash. If I on the other hand I need brain surgery I will likely go to the local hospital and use the services of the local surgeon. Does this appear to be the kind of fairness that Obama is talking about? I think not!
This is not limited to the health industry. If OJ Simpson had a court appointed public defender, do you think he would have been found not guilty? Can the local inner city kid who robs a gas station and kills the attendant receive the defense of the, “Dream Team”, of lawyers that Simpson got. I think not!
The point is that we live in a world where we do not have unlimited resources which means by definition that we must limit what we do. When it comes to Medicare and Medicaid we cannot spend unlimited resources on each person. We must use the dirty word “ration” when it comes to what we can do. Yes we must have death panels.
You start with something obvious like should a 97 year old man with a bad liver get a heart transplant and then work your way down from that.
The only possible way to put fairness into the systems is to limit what Bill Gates can pay out of his own pocket for his own health care and I don’t believe that Americans want to go down that road.
I say it is time for Americans to wake up to the fact that all of this talk about fairness just takes us away from looking at the problem in a serious way.
This is not limited to the health industry. If OJ Simpson had a court appointed public defender, do you think he would have been found not guilty? Can the local inner city kid who robs a gas station and kills the attendant receive the defense of the, “Dream Team”, of lawyers that Simpson got. I think not!
The point is that we live in a world where we do not have unlimited resources which means by definition that we must limit what we do. When it comes to Medicare and Medicaid we cannot spend unlimited resources on each person. We must use the dirty word “ration” when it comes to what we can do. Yes we must have death panels.
You start with something obvious like should a 97 year old man with a bad liver get a heart transplant and then work your way down from that.
The only possible way to put fairness into the systems is to limit what Bill Gates can pay out of his own pocket for his own health care and I don’t believe that Americans want to go down that road.
I say it is time for Americans to wake up to the fact that all of this talk about fairness just takes us away from looking at the problem in a serious way.
Honesty
On the news today there is a story about a gas station in California where the pump price was set at $1.10 instead of $4.29 and in three hours some 7,000 gallons of gas was sold at this lower price. An estimated 300 customers bought gas at this low price and no one reported this to the station manager. Ordinarily I would not pay much attention to a story like this but it reminded me of something that happened to me about 40 years ago. As most of you know I used to own a neighborhood tavern and one night after closing someone broke in and took the money from the till. I don’t recall the amount but I do know that typically about 75% of my daily take was in the form of checks. In the days that followed many customers came in and told me that if their check did not clear the bank they would come in and write me another check. As I recall these people completely reimbursed me for all the checks I lost in the robbery. Does this show how times have changed or does it show the difference between California and North Dakota? I don’t know.
Predestination
When I was a student I was taught that there was a heaven and a hell and it was with some consternation that I encountered the concept of predestination. My thought was that if God already knew what my future was then what difference did it make as to how I lived my life.
It was many years later, after I conclude that there was no hell that I got a better understanding of predestination. I believe that before I was born that God laid out a plan for my life down to the tiniest detail and if I followed that plan I would have life of joy and happiness. This does not mean that I would never encounter any disappointments but that I would be able to deal with these down turns in a constructive manner.
The conflict arises because God also gave me a free will and I am allowed to deviate from God’s plan anytime I choose.
Now as a young adult my ego stepped in and began to run the show and often times the plan of the ego moved away from God’s plan and thus introduced stress into my life.
Think of God’s plan as your right hand and the ego’s plan as you left hand. Now there is a spring holding these two hands together and as they pull apart the tension on the spring increases. As long as they remain fairly close the tension is not too great to cause any trouble but when they move a certain distance, problems surface. These problems can be physical, mental, emotional or spiritual and they detract from your joy and happiness. If you are fortunate, sometime well into the second half of life you realize what is going on and you take the necessary steps to reign in your ego and realign yourself with God’s plan and you can spend your remaining years in peace and contentment.
So while there is such a thing as predestination, I am not bound by limits of God’s plan because I am free to choose which plan I want to follow. By following the plan of the ego does not mean that I must spend the rest of eternity in hell but it does mean that my life on earth was not as happy as it could have been.
It was many years later, after I conclude that there was no hell that I got a better understanding of predestination. I believe that before I was born that God laid out a plan for my life down to the tiniest detail and if I followed that plan I would have life of joy and happiness. This does not mean that I would never encounter any disappointments but that I would be able to deal with these down turns in a constructive manner.
The conflict arises because God also gave me a free will and I am allowed to deviate from God’s plan anytime I choose.
Now as a young adult my ego stepped in and began to run the show and often times the plan of the ego moved away from God’s plan and thus introduced stress into my life.
Think of God’s plan as your right hand and the ego’s plan as you left hand. Now there is a spring holding these two hands together and as they pull apart the tension on the spring increases. As long as they remain fairly close the tension is not too great to cause any trouble but when they move a certain distance, problems surface. These problems can be physical, mental, emotional or spiritual and they detract from your joy and happiness. If you are fortunate, sometime well into the second half of life you realize what is going on and you take the necessary steps to reign in your ego and realign yourself with God’s plan and you can spend your remaining years in peace and contentment.
So while there is such a thing as predestination, I am not bound by limits of God’s plan because I am free to choose which plan I want to follow. By following the plan of the ego does not mean that I must spend the rest of eternity in hell but it does mean that my life on earth was not as happy as it could have been.
Short sale
A Short Sale is when you sell stock you do not own. So how does this work. Let’s assume that you think a stock is going to fall in value. A certain stock is selling for $100 per share and you believe it will go down in value so you go to your broker and you borrow 100 shares from him and agree to pay him back in one year. He charges you 5% interest for these shares. You immediately sell the 100 shares for $10,000 and you set aside $600 to pay the interest at the end of the year. 12 months later you guessed right and the stock is selling for $50 per share so you go out and buy 100 shares for $5,000 and pay back your broker along with the $600. You have made $4,400 on this transaction.
There is currently an investigation into activities by Goldman Sachs for insider trading. Apparently Goldman put together a group of really bad home mortgages and then told their clients to buy them saying they were a good investment. They sold many billions of these and while doing so their top executives were selling these products short. Sure enough the investments failed and 8 executives from Goldman made over $500 million dollars each. Here is a quote from a professor regarding the White House and Goldman
Lawrence Jacobs, a University of Minnesota political scientist, said that "almost everything that the White House has done has been haunted by the personnel and the money of Goldman . . . as well as the suspicion that the White House, particularly early on, was pulling its punches out of deference to Goldman and its war chest.
Here is list of Goldman employees connected with the White House.
Obama Administration: Deputy Director, National Economic Council
Former Goldman Sachs Title: Financial Analyst
Stephen Friedman:
Obama Administration: Chairman, President’s Foreign Intelligence Advisory Board
Former Goldman Sachs Title: Board Member (Chairman, 1990-94; Director, 2005-)
Gary Gensler:
Obama Administration: Commissioner, Commodity Futures Trading Commission
Former Goldman Sachs Title: Partner and Co-head of Finance
Robert Hormats:
Obama Administration: Undersecretary for Economic, Energy and Agricultural Affairs, State Department
Former Goldman Sachs Title: Vice Chairman, Goldman Sachs Group
Philip Murphy:
Obama Administration: Ambassador to Germany
Former Goldman Sachs Title: Head of Goldman Sachs, Frankfurt
Mark Patterson:
Obama Administration: Chief of Staff to Treasury Secretary, Timothy Geitner
Former Goldman Sachs Title: Lobbyist 2005-2008; Vice President for Government Relations
John Thain:
Obama Administration: Advisor to Treasury Secretary, Timothy Geitner
Former Goldman Sachs Title: President and Chief Operating Officer (1999-2003)
Henry Paulson:
Bush II Administration: Secretary, Treasury 2006 - 2009
Former Goldman Sachs Title: Chairman and CEO (1998-2006)
Neel Kashkari:
Bush II Administration: Assistant Secretary for Financial Stability, Treasury (2008 – 2009)
Former Goldman Sachs Title: Vice President, San Francisco; led Information Technology Security Investment Banking Practice
Reuben Jeffery III:
Bush II Administration: Undersecretary for Economic, Energy and Agricultural Affairs, State Department (2007 –2009)
Former Goldman Sachs Title: Managing Partner Paris until 2002 Security Investment Banking Practice
Robert Steel:
Bush II Administration: Under Secretary for Domestic Finance, Treasury, (2006 – 2008)
Former Goldman Sachs Title: Vice Chairman – 2004
Steve Shafran:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Private equity business in Asia until 2000
Edward C. Forst:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Co-head of Goldman’s investment management business
Dan Jester:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Deputy CFO
Kendrick R. Wilson III:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Chairman of Goldman’s financial institutions groups
Joshua Bolten:
Bush II Administration: White House Chief of Staff (2006 – 2009)
Former Goldman Sachs Title: Executive Director, Legal & Government Affairs (1994-99)
Gary Gensler:
Bush II Administration: Undersecretary, Treasury (1999-2001) and Assistant Secretary, Treasury (1997-1999)
Former Goldman Sachs Title: Partner and Co-head of Finance
Robert Rubin:
Bush II Administration: Secretary, Treasury 1995-1999
Former Goldman Sachs Title: Vice Chairman (1987-90)
Robert Zoellick:
Bush II Administration: United States Trade Representative (2001-2005), Deputy Secretary of State (2005-2006), World Bank President (2007 -)
Former Goldman Sachs Title: Vice Chairman, International (2006-07)
William C Dudley:
NY Federal Reserve: Current President/CEO
Former Goldman Sachs Title: Partner and managing director – 2007
Stephen Friedman:
NY Federal Reserve: Former Chairman of the Board – 2009
Former Goldman Sachs Title: Board Member (Chairman, 1990-94; Director, 2005-)
Other Noteworthy Appointees:
Edward Liddy:
Current Title: AIG CEO
Former Goldman Sachs Title: Board Member (Chairman, 1990-94; Director, 2005-)
Duncan Niederauer:
Current Title: Chair/CEO NYSE
Former Goldman Sachs Title: Managing Director – 2007
Malcolm Turnbull:
Current Title: Federal Leader, Liberal Party, Australia
Former Goldman Sachs Title: Partner (1998-2001)
Mark Carney:
Current Title: Governor, Bank of Canada
Former Goldman Sachs Title: Managing Director Goldman Sachs Canada until 2003
David Watson:
Current Title: Monetary Policy Committee, Bank of England
Former Goldman Sachs Title: Chief European economist
Romano Prodi:
Current Title: Prime Minister of Italy (1996-1998 and 2006-2008) and President of the European Commission (1999-2004)
Former Goldman Sachs Title: Paid adviser/consultant 1990 – 1993
Mario Draghi:
Current Title: Governor of the Bank of Italy (2006- )
Former Goldman Sachs Title: European Deputy Chairman/Partner until 2006
Massimo Tononi:
Current Title: Italian Deputy Treasury Chief (2006-2008)
Former Goldman Sachs Title: Partner 2004 – 2006
Do you think any of the Goldman short sellers will be going to jail?
There is currently an investigation into activities by Goldman Sachs for insider trading. Apparently Goldman put together a group of really bad home mortgages and then told their clients to buy them saying they were a good investment. They sold many billions of these and while doing so their top executives were selling these products short. Sure enough the investments failed and 8 executives from Goldman made over $500 million dollars each. Here is a quote from a professor regarding the White House and Goldman
Lawrence Jacobs, a University of Minnesota political scientist, said that "almost everything that the White House has done has been haunted by the personnel and the money of Goldman . . . as well as the suspicion that the White House, particularly early on, was pulling its punches out of deference to Goldman and its war chest.
Here is list of Goldman employees connected with the White House.
Obama Administration: Deputy Director, National Economic Council
Former Goldman Sachs Title: Financial Analyst
Stephen Friedman:
Obama Administration: Chairman, President’s Foreign Intelligence Advisory Board
Former Goldman Sachs Title: Board Member (Chairman, 1990-94; Director, 2005-)
Gary Gensler:
Obama Administration: Commissioner, Commodity Futures Trading Commission
Former Goldman Sachs Title: Partner and Co-head of Finance
Robert Hormats:
Obama Administration: Undersecretary for Economic, Energy and Agricultural Affairs, State Department
Former Goldman Sachs Title: Vice Chairman, Goldman Sachs Group
Philip Murphy:
Obama Administration: Ambassador to Germany
Former Goldman Sachs Title: Head of Goldman Sachs, Frankfurt
Mark Patterson:
Obama Administration: Chief of Staff to Treasury Secretary, Timothy Geitner
Former Goldman Sachs Title: Lobbyist 2005-2008; Vice President for Government Relations
John Thain:
Obama Administration: Advisor to Treasury Secretary, Timothy Geitner
Former Goldman Sachs Title: President and Chief Operating Officer (1999-2003)
Henry Paulson:
Bush II Administration: Secretary, Treasury 2006 - 2009
Former Goldman Sachs Title: Chairman and CEO (1998-2006)
Neel Kashkari:
Bush II Administration: Assistant Secretary for Financial Stability, Treasury (2008 – 2009)
Former Goldman Sachs Title: Vice President, San Francisco; led Information Technology Security Investment Banking Practice
Reuben Jeffery III:
Bush II Administration: Undersecretary for Economic, Energy and Agricultural Affairs, State Department (2007 –2009)
Former Goldman Sachs Title: Managing Partner Paris until 2002 Security Investment Banking Practice
Robert Steel:
Bush II Administration: Under Secretary for Domestic Finance, Treasury, (2006 – 2008)
Former Goldman Sachs Title: Vice Chairman – 2004
Steve Shafran:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Private equity business in Asia until 2000
Edward C. Forst:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Co-head of Goldman’s investment management business
Dan Jester:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Deputy CFO
Kendrick R. Wilson III:
Bush II Administration: Advisor on setting up TARP to Treasury Secretary, Henry Paulson 2008
Former Goldman Sachs Title: Chairman of Goldman’s financial institutions groups
Joshua Bolten:
Bush II Administration: White House Chief of Staff (2006 – 2009)
Former Goldman Sachs Title: Executive Director, Legal & Government Affairs (1994-99)
Gary Gensler:
Bush II Administration: Undersecretary, Treasury (1999-2001) and Assistant Secretary, Treasury (1997-1999)
Former Goldman Sachs Title: Partner and Co-head of Finance
Robert Rubin:
Bush II Administration: Secretary, Treasury 1995-1999
Former Goldman Sachs Title: Vice Chairman (1987-90)
Robert Zoellick:
Bush II Administration: United States Trade Representative (2001-2005), Deputy Secretary of State (2005-2006), World Bank President (2007 -)
Former Goldman Sachs Title: Vice Chairman, International (2006-07)
William C Dudley:
NY Federal Reserve: Current President/CEO
Former Goldman Sachs Title: Partner and managing director – 2007
Stephen Friedman:
NY Federal Reserve: Former Chairman of the Board – 2009
Former Goldman Sachs Title: Board Member (Chairman, 1990-94; Director, 2005-)
Other Noteworthy Appointees:
Edward Liddy:
Current Title: AIG CEO
Former Goldman Sachs Title: Board Member (Chairman, 1990-94; Director, 2005-)
Duncan Niederauer:
Current Title: Chair/CEO NYSE
Former Goldman Sachs Title: Managing Director – 2007
Malcolm Turnbull:
Current Title: Federal Leader, Liberal Party, Australia
Former Goldman Sachs Title: Partner (1998-2001)
Mark Carney:
Current Title: Governor, Bank of Canada
Former Goldman Sachs Title: Managing Director Goldman Sachs Canada until 2003
David Watson:
Current Title: Monetary Policy Committee, Bank of England
Former Goldman Sachs Title: Chief European economist
Romano Prodi:
Current Title: Prime Minister of Italy (1996-1998 and 2006-2008) and President of the European Commission (1999-2004)
Former Goldman Sachs Title: Paid adviser/consultant 1990 – 1993
Mario Draghi:
Current Title: Governor of the Bank of Italy (2006- )
Former Goldman Sachs Title: European Deputy Chairman/Partner until 2006
Massimo Tononi:
Current Title: Italian Deputy Treasury Chief (2006-2008)
Former Goldman Sachs Title: Partner 2004 – 2006
Do you think any of the Goldman short sellers will be going to jail?
Great Society
I don't know anything about your organization but I am suspect. My suspicions arise from my experience with the Great Society. I voted for Lynden Johnson because of his ideas on helping the downtrodden. I was always in favor of what I called the Robin Hood syndrome and what many consider the foundation of the Democratic Party, that is, the redistribution of wealth. I believe that if all eligible voters were informed about the issues and then voted their best interest, there would be no Republican Party, at least not it it's present form. I believe that this is future for politics in American. As more minorities, especially Hispanics, begin to take a more active role in society many more people will be elected by campaigning on the issue of taking from those who have a lot and giving to those who have little. This will progress into giving to those who have some. Many middle class people are not aware that they are currently receiving benefits in the form of various kinds of tax shelters. Mortgage deductions, pension benefits, and charitable gifts to name a few. These shelters are primarily used by the middle class, that is, those with family incomes above $50,000 and who are homeowners. Other groups like farmers and business owners have their share of shelters and of course large corporations have many gifts from our governments.
You might ask that if I am aware of how all this money is redistributed why begrudge those on the low end of the economic scale. I answer based on my experience with the Great Society. There are too many middlemen. By the time my dollar goes through the system only about twenty cents gets to the intended target, while the rest is siphoned off by those in charge.
I will predict that our new emigrants will learn much faster than those who came with my parents that the way to the golden streets is through government rather than hard work. This is not the case now with the Hispanics that I know but given the proper guidance they will quickly learn.
I have not even mentioned the damage done to three generations of welfare recipients in ways other than economic but that is another subject.
You might ask that if I am aware of how all this money is redistributed why begrudge those on the low end of the economic scale. I answer based on my experience with the Great Society. There are too many middlemen. By the time my dollar goes through the system only about twenty cents gets to the intended target, while the rest is siphoned off by those in charge.
I will predict that our new emigrants will learn much faster than those who came with my parents that the way to the golden streets is through government rather than hard work. This is not the case now with the Hispanics that I know but given the proper guidance they will quickly learn.
I have not even mentioned the damage done to three generations of welfare recipients in ways other than economic but that is another subject.
Prison guards
Something happened this past week in California that is a small item in the overall scheme of things but represents one of the major problems with pensions. If you have a defined benefit pension plan like most public employee plans you determine your pension benefit by how much money you earn in the last years of work, normally the last three years. If your pension plans says it will pay your 1.5% of your final average salary times the number of years you work there, then the amount you earn in those last years is critical. Over the years this has led to the practice of working lots of overtime in those last years to build up your pension. These extra hours were available since people nearing retirement are the most senior employees and can demand the overtime.
Now back to California. The Governor Jerry Brown received a lot of campaign help from members of the prison guard union so he recently negotiated some good deals for them.
The governor is extending this benefit only to members of the California Correctional Peace Officers Assn., a union that spent nearly $2 million to help him win election last year
They are now allowed to accumulate vacation time in unlimited amounts and then to apply those earnings to the last years of work to raise their pension. Since they are eligible for 8 weeks of vacation after one year of service, this can add up to a lot of vacation time. Currently the average guard has 19 weeks of accumulated leave and the starting pay for a guard is $78,000 per year. When this vacation time is added to the employee near retirement they can use their wage at that time which would be considerably higher than the wage they had when the first became eligible for the leave.
The deal also would give the members 18 more days off over the life of the two-year contract, according to Schroeder, bringing the typical prison guard's time off to more than eight weeks in the first year.
Another change that occurred is that the guards used to get an extra $130 per month if they stayed physically fit but that is now changed to just having an annual physical to qualify for the $130.
This is an example of what has been going on all over the country. Unions organize and help with time and money to elect leaders who then offer them extra benefits. This is the thing that the Governor of Wisconsin is fighting but it is a battle that will affect all states
Now back to California. The Governor Jerry Brown received a lot of campaign help from members of the prison guard union so he recently negotiated some good deals for them.
The governor is extending this benefit only to members of the California Correctional Peace Officers Assn., a union that spent nearly $2 million to help him win election last year
They are now allowed to accumulate vacation time in unlimited amounts and then to apply those earnings to the last years of work to raise their pension. Since they are eligible for 8 weeks of vacation after one year of service, this can add up to a lot of vacation time. Currently the average guard has 19 weeks of accumulated leave and the starting pay for a guard is $78,000 per year. When this vacation time is added to the employee near retirement they can use their wage at that time which would be considerably higher than the wage they had when the first became eligible for the leave.
The deal also would give the members 18 more days off over the life of the two-year contract, according to Schroeder, bringing the typical prison guard's time off to more than eight weeks in the first year.
Another change that occurred is that the guards used to get an extra $130 per month if they stayed physically fit but that is now changed to just having an annual physical to qualify for the $130.
This is an example of what has been going on all over the country. Unions organize and help with time and money to elect leaders who then offer them extra benefits. This is the thing that the Governor of Wisconsin is fighting but it is a battle that will affect all states
Obama Tsars
Agencies are also evaluated on demonstrating continuous progress towards implementing additional statutory or Executive Order targets and goals reflected in their annual Sustainability Plans
This is part of what you sent me…..notice that statutory means laws and that means congress whereas Executive Order is just something dreamed up by one of Obama’s Czars.
This is part of what you sent me…..notice that statutory means laws and that means congress whereas Executive Order is just something dreamed up by one of Obama’s Czars.
Ryan 2
I was not quite sure what the meaning of demagogue was until the recent discussions of Paul Ryan’s plan for Medicare. Remarks like, “it will throw grandma into the streets” and “disabled children will be left to fend for themselves” are perfect examples of demagoguery. To demagogue is to take something you don’t like and exaggerate its negatives to the point where no one likes it.
To understand the Ryan plan we must first review the present system. Currently the two main parts of Medicare are Part A to pay hospital bills and Part B to pay doctors bill. There is no premium for Part A and Part B cost $1,157 per year. If your income is higher than $80,000 you pay more for Part B and at $214,000 you pay over $4,000 per year.
This is how the Ryan plan will work, by charging a higher premium for those who make more. The exact numbers are not yet out but you can imagine a progressive payment plan. For example if your income is over $50,000 you will pay more, say an extra $1,000 per year for every $10,000 you make over $50,000. Continue this up to say $200,000 at which you would pay an additional $15,000 per year.
The Ryan plan will continue the practice of the current plan of limiting treatments but will not deny the process. Medicare maintains that they do not limit treatments but that is not the case. You might question why the oldest person to receive a heart transplant was 79. We know that late life counseling is used to limit treatment but that too is denied.
To understand the Ryan plan we must first review the present system. Currently the two main parts of Medicare are Part A to pay hospital bills and Part B to pay doctors bill. There is no premium for Part A and Part B cost $1,157 per year. If your income is higher than $80,000 you pay more for Part B and at $214,000 you pay over $4,000 per year.
This is how the Ryan plan will work, by charging a higher premium for those who make more. The exact numbers are not yet out but you can imagine a progressive payment plan. For example if your income is over $50,000 you will pay more, say an extra $1,000 per year for every $10,000 you make over $50,000. Continue this up to say $200,000 at which you would pay an additional $15,000 per year.
The Ryan plan will continue the practice of the current plan of limiting treatments but will not deny the process. Medicare maintains that they do not limit treatments but that is not the case. You might question why the oldest person to receive a heart transplant was 79. We know that late life counseling is used to limit treatment but that too is denied.
Ryan Plan
I was never quite sure what the word Demagogue meant until the recent descriptions of Paul Ryan’s Medicare plan were revealed. Remarks like, “it will throw grandma in the street”, and “disabled kids will be left to fend for themselves” are examples of demagoguery. It is taking something you don’t like and exaggerating the negatives until no one likes it.
In order to understand the Ryan plan we first must understand the present Medicare system. Medicare has two main parts, Part A for hospital bills and Part B for doctor bills. There is no charge for Part A and Part B cost $1,157 per year for most. Note that I said most.
If your hospital bill is $20,000 Medicare will only approve part of that amount, on average about 80% or $16,000. The hospital then charges their private pay patience an additional $4,000 to make up the difference. The same thing happens with doctor bills. If your bill is $300 Medicare will approve, say $200 and the doctor must charge his private patience and extra $100. If Medicare approves $200 the pay 80% of that or $160 and most people have a supplemental insurance policy to pick up the other $40.
I said earlier that the cost for most is $1,157 per year but for higher income people the cost goes up reaching a cost of $4,243 per year for individuals whose income is above $214,000. This is the way that the Ryan plan will work.
The first thing to know about the Ryan plan is that is does not affect anyone who is over the age of 55. For those under that age when they become eligible for Medicare at age 65 the benefits will be similar but the payments will change. The exact numbers are not out yet but typically it will look something like this. Your premium will be $1,157 per year but if your income is above $50,000 you will pay an additional $100 per year for every $1,000 over $50,000 you make. So if your income is $60,000 you will pay $2,157 per year instead of $1,157. At $70,000 you pay $3,157 and so on until at $200,000 income you pay $16,157.
When you look at the plan this way you see it is a reasonable approach to saving Medicare. By the way, some suggest that since everyone likes Medicare, why not have Medicare for everyone? If you do that, to whom would the doctors and hospitals charge off their shortages?
Everyone who understands Medicare knows that it restricts treatments and payments for treatments and this will continue under the Ryan plan. The problem is that the official position of Medicare is that they do not restrict treatments
In order to understand the Ryan plan we first must understand the present Medicare system. Medicare has two main parts, Part A for hospital bills and Part B for doctor bills. There is no charge for Part A and Part B cost $1,157 per year for most. Note that I said most.
If your hospital bill is $20,000 Medicare will only approve part of that amount, on average about 80% or $16,000. The hospital then charges their private pay patience an additional $4,000 to make up the difference. The same thing happens with doctor bills. If your bill is $300 Medicare will approve, say $200 and the doctor must charge his private patience and extra $100. If Medicare approves $200 the pay 80% of that or $160 and most people have a supplemental insurance policy to pick up the other $40.
I said earlier that the cost for most is $1,157 per year but for higher income people the cost goes up reaching a cost of $4,243 per year for individuals whose income is above $214,000. This is the way that the Ryan plan will work.
The first thing to know about the Ryan plan is that is does not affect anyone who is over the age of 55. For those under that age when they become eligible for Medicare at age 65 the benefits will be similar but the payments will change. The exact numbers are not out yet but typically it will look something like this. Your premium will be $1,157 per year but if your income is above $50,000 you will pay an additional $100 per year for every $1,000 over $50,000 you make. So if your income is $60,000 you will pay $2,157 per year instead of $1,157. At $70,000 you pay $3,157 and so on until at $200,000 income you pay $16,157.
When you look at the plan this way you see it is a reasonable approach to saving Medicare. By the way, some suggest that since everyone likes Medicare, why not have Medicare for everyone? If you do that, to whom would the doctors and hospitals charge off their shortages?
Everyone who understands Medicare knows that it restricts treatments and payments for treatments and this will continue under the Ryan plan. The problem is that the official position of Medicare is that they do not restrict treatments
talf
Auto dealers borrow money to purchase inventory. A typical dealer has a 5 million dollar loan and these are called floor plan loans. They worked together to bundle these loan request into securitized asset backed securities called ABS’s. These are then purchased by various institutional investors.
This had been working quite well until the big market collapse in late 2008. After that no one would buy these ABS’s. The government then stepped in with a program called Term Asset Backed Security Loan Facility known as TALF. This program would loan money at low interest rates to individuals or businesses so that they could buy ABS’s.
The deal was that TALF would loan money at rates ranging from .5 to 2 percent to be used to purchase floor plan loans which paid 4 to 6 percent. The government guaranteed that if the purchaser made a profit they could keep the money but if they lost the government would absorb 90% of any loss.
There were trillions loaned under the TALF program to all sorts of investors around the world but I would like to high light two of these loans. The wives of two Morgan Stanley executives, Christi Mack and Susan Karches received a TALF loan for 225 million dollars. These ladies had no previous experience in this type of investing.
It’s not what you know, it’s who you know.
This had been working quite well until the big market collapse in late 2008. After that no one would buy these ABS’s. The government then stepped in with a program called Term Asset Backed Security Loan Facility known as TALF. This program would loan money at low interest rates to individuals or businesses so that they could buy ABS’s.
The deal was that TALF would loan money at rates ranging from .5 to 2 percent to be used to purchase floor plan loans which paid 4 to 6 percent. The government guaranteed that if the purchaser made a profit they could keep the money but if they lost the government would absorb 90% of any loss.
There were trillions loaned under the TALF program to all sorts of investors around the world but I would like to high light two of these loans. The wives of two Morgan Stanley executives, Christi Mack and Susan Karches received a TALF loan for 225 million dollars. These ladies had no previous experience in this type of investing.
It’s not what you know, it’s who you know.
default
I often hear commentators on financial cable stations cry wolf and I normally don’t pay that much attention but recently several factors have come together which may indicate a possible more serious situation. First China has reduced purchases of US bonds for the past three months. Japan will be selling US bonds to get money to pay for earth quake damage and finally and most important:
World's largest bond investor Pimco dumps US Treasuries
Bill Gross, who runs Pacific Investment Management's $236bn bond fund believes that US may be in danger of default
When the money makers start to dump, I get concerned. Gross and Warren Buffet have both divested themselves from US bonds.
If the US should default it would not be like a business as the government would continue to function since we just print money to pay the bills. My concern is that this will add to the inflationary pressures we already face. Those of you who are old enough to remember the late 70’s and early 80’s know what stagflation is when we had 13% inflation, 21% interest rates and 10% unemployment. How many home loans do you think were issued when the interest rate was 21%?
World's largest bond investor Pimco dumps US Treasuries
Bill Gross, who runs Pacific Investment Management's $236bn bond fund believes that US may be in danger of default
When the money makers start to dump, I get concerned. Gross and Warren Buffet have both divested themselves from US bonds.
If the US should default it would not be like a business as the government would continue to function since we just print money to pay the bills. My concern is that this will add to the inflationary pressures we already face. Those of you who are old enough to remember the late 70’s and early 80’s know what stagflation is when we had 13% inflation, 21% interest rates and 10% unemployment. How many home loans do you think were issued when the interest rate was 21%?
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