Printable View
[QUOTE=Esten;417162]Anyone with half a brain knows the problem is two-fold[/QUOTE]Exactly!
It takes a big man to confess, Esten. But, you've obviously put your finger on the problem: There are too many half-wits just like you in Washington.
Once we get the half-brained, left-wing politicians out of there, and replace them with some full-brained representatives, then we'll make some progress.
[QUOTE=Stan the Man; 417149]HappyGoLucky, please at least make an effort to arm yourself with facts before making absurd arguments.
[i][b]Are Public Sector Workers Overcompensated? [/b]
Several analyses of average wages and benefits in the public and private sectors reveal that state and local government workers earn more than private sector workers.
Again, we don't have a revenue problem, except to the extent the rich pay too much in taxes. [/QUOTE]Stan, I think we'd probably agree that statistics are what people make of them. For example, the data analysis in this paper from the Economic Policy Institute indicates that public employees, both state and local government, are not overpaid compared to the private sector:
[url]http://www.epi.org/publications/entry/debunking_the_myth_of_the_overcompensated_public_employee/[/url]
Regarding the rich "paying too much in taxes",
CNN Money's Chris Isidore looked at the gap between rich and middle-class Americans back during the holidays. He wrote on December 23:
"The richest 1% of USA households had a net worth 225 times greater than that of the average American household in 2009, according to analysis conducted by the Economic Policy Institute. That's up from the previous record of 190 times greater, which was set in 2004."
Meanwhile a recent study from the Commerce Department shed some light on an issue that we already know. Over the past 20 years the middle class has been falling behind:
[url]http://www.mybudget360.com/income-budget-game-over-for-the-american-middle-class-inflation-adjusted-wages-up-20-percent-in-last-20-years-while-housing-costs-are-up-56-percent-and-healthcare-costs-are-up-155-percent/[/url]
I suppose one might make the argument that these studies were done by "liberals" and therefore biased, but the same can be said of GOP think tanks.
The real bottom line is the extinction of the middle class as we knew it growing up:
"Think of the rise of our economy in the 1940s and 1950s. Many returning GIs had access to affordable education through new programs and grants. It is the least you can offer to someone defending this country. Next, it was possible to support a family with one income because we had a strong and sustainable manufacturing base. Now, we have families with two incomes in the service sector trying to piece things together. Throw in a child, and that second income evaporates through childcare costs and educational fees. In other words, just because people have more income their buying power has collapsed."
"While writing about the increasing income disparity between America's rich and middle class, CNN Money's Annalyn Censky threw out this zinger:
In 1988, the income of an average American taxpayer was $33, 400, adjusted for inflation. Fast forward 20 years, and not much had changed: The average income was still just $33, 000 in 2008, according to IRS data.
Meanwhile, the richest 1% of Americans — those making $380, 000 or more — have seen their incomes grow 33% over the last 20 years, leaving average Americans in the dust."
So Stan, what kind of a country do we want? It seems like we're fast approaching a nation of only two polarities, the haves and the have-nots; it reminds me of Paraguay.
[QUOTE=Stan the Man; 417196]There's a blog out there cataloging all of the many inconsistencies of the Obama Administration regarding Osama bin Laden's killing. Obama was armed; then he wasn't; he used his wife as a shield; no he didn't; his wife died; no, just shot in the leg and it wasn't his wife; etc, etc.
[url]http://www.bookwormroom.com/2011/05/04/the-obama-administrations-cloud-of-confusion-explained/[/url]
Most of it is pretty mundane, but I thought the following was priceless and wanted to share:
[i]The idiot Carney — they actually managed to find someone who makes Gibbs look good — is currently twisting himself into knots trying to explain why the photograph that the whole world was expecting isn't going to be released. (Obviously the thing to do is get Trump on the case, he'll force Obama to release it.) [/i]
LOL. Thing is, I wouldn't be surprised to see Trump take up the cudgel. [/QUOTE]If you (any senior monger) ever hear me criticizing Obama for giving the 'go' to the OP that rid this world of the scum-sucking swine named Osama Bin Laden, I will buy you a beer at your choice of Bs As chica bars. That said, Obama (and his ilk) is his own worst enemy in this situation. It's like Watergate, the cover up is the problem. If they weren't so busy trying to recast what happened into some Disney tale (that avoids complying with the Bush Doctrine) , everyone would be on board. If I were advising Obama (as this thing went down) I'd tell him to tell the US,"we found out where this POS was hiding, we went in, we found him and we took this mutherf*cker out." End of story. Everything else the administration has said has unnecessarily complicated the matter. Just shut the fuck up and bask in the glory. These idiots could fuck up a wet dream.
I don't care if Osama had an AK47 or his pecker in his hand, if I walked into that room, he would have caught a double tap in the noggin. I would have greased everyone with whom I came into contact. I would have buried that POS inside the body cavity of Hogzilla, in my back yard. I don't care if they were armed or not. If you hang with Osama, you can burn in hell with him.
All of the aforementioned said, I'm just a monger, not the POTUS. If I were the POTUS, I would have rescinded Executive Order 12333 just prior to the commencement of the op. I would then, prophylactically grant all members of Team 6 presidential pardons to protect them from prosecution within the US by liberals. When asked by the liberal media, I would say,"it doesn't matter if he was armed (non of the folks at the three sites of carnage on 9/11 were armed) or not, we were there to dispatch him with extreme prejudice. Are you {mr. Liberal media guy] pro Osama?" "You're pro-Osama? I think that the American people should know that [name of news outlet] is taking sides against the USA."
As it stands, it looks like Obama has violated Executive Order 12333 and many of the members of his administration (excluding Obama) have been actively and intentionally misleading the press and the public. The less he says the better. If he keeps yapping, team 6 is going to be the focus of a tribunal in den Hague and he is setting himself up to be impeached by the likes of Dennis Kucinich.
You are totally right. Since there is no picture, Obama, Gates, Clinton, Biden, SEAL, Pakistan government- all of them are lying.
[QUOTE=Stan the Man; 417196]There's a blog out there cataloging all of the many inconsistencies of the Obama Administration regarding Osama bin Laden's killing. Obama was armed; then he wasn't; he used his wife as a shield; no he didn't; his wife died; no, just shot in the leg and it wasn't his wife; etc, etc.
[url]http://www.bookwormroom.com/2011/05/04/the-obama-administrations-cloud-of-confusion-explained/[/url]
Most of it is pretty mundane, but I thought the following was priceless and wanted to share:
[i]The idiot Carney — they actually managed to find someone who makes Gibbs look good — is currently twisting himself into knots trying to explain why the photograph that the whole world was expecting isn't going to be released. (Obviously the thing to do is get Trump on the case, he'll force Obama to release it.) [/i]
LOL. Thing is, I wouldn't be surprised to see Trump take up the cudgel. [/QUOTE]
[QUOTE=Stan Da Man;416935]Please provide some support for your assertions that "wealth" is increasingly "accumulating in a small subset of the population" resulting in "unemployment, poverty and stagnating wealth for the middle class."[/QUOTE]Stan, see below HGL's post and my added comments. And as you know unemployment is the highest in decades, and the poverty rate is at a 15-year high (and near a 40-year high) :
[url]http://www.nytimes.com/2010/09/17/us/17poverty.html[/url]
[QUOTE=HappyGoLucky; 417207]CNN Money's Chris Isidore looked at the gap between rich and middle-class Americans back during the holidays. He wrote on December 23:
"The richest 1% of USA households had a net worth 225 times greater than that of the average American household in 2009, according to analysis conducted by the Economic Policy Institute. That's up from the previous record of 190 times greater, which was set in 2004."
Meanwhile a recent study from the Commerce Department shed some light on an issue that we already know. Over the past 20 years the middle class has been falling behind: [/QUOTE]
[QUOTE]"While writing about the increasing income disparity between America's rich and middle class, CNN Money's Annalyn Censky threw out this zinger:
In 1988, the income of an average American taxpayer was $33, 400, adjusted for inflation. Fast forward 20 years, and not much had changed: The average income was still just $33, 000 in 2008, according to IRS data.
Meanwhile, the richest 1% of Americans — those making $380, 000 or more — have seen their incomes grow 33% over the last 20 years, leaving average Americans in the dust."[/QUOTE]
Good post. You might find this article interesting.
Study: Most Americans Want Wealth Distribution Similar to Sweden.
[url]http://www.alternet.org/newsandviews/article/569425/study%3A_most_americans_want_wealth_distribution_similar_to_sweden[/url]
Click on the "research (PDF)" file and go to Figure 2 on page 12. This study is based on 5522 respondents in 2005. Figure 2 is remarkable. Wealth distribution was as follows:
Actual: Top quintile 84%, second quintile 11%, other three quintiles 5%
Estimated: Top quintile 58%, second quintile 20%, other three quintiles 22%
Ideal: Top quintile 32%, second quintile 22%, other three quintiles 46%
So people's estimates were low, but that was still perceived as too inequal. Imagine what people think of the actual- the bottom 60% with just 5% of all wealth.
Here is another good article. Between 1979-2007, share of after-tax income increased from 7% to 17% for the Top 1%. While it decreased from 58% to 48% for the bottom four-fifths. Lots of other good data and charts here too.
Income Gaps Between Very Rich and Everyone Else More Than Tripled In Last Three Decades, New Data Show
[url]http://www.cbpp.org/cms/index.cfm?fa=view&id=3220[/url]
[QUOTE=Wild Walleye; 417210]If they weren't so busy trying to recast what happened into some Disney tale (that avoids complying with the Bush Doctrine) , everyone would be on board. If I were advising Obama (as this thing went down) I'd tell him to tell the US,"we found out where this POS was hiding, we went in, we found him and we took this mutherf*cker out." End of story. Everything else the administration has said has unnecessarily complicated the matter. Just shut the fuck up and bask in the glory. These idiots could fuck up a wet dream.
I don't care if Osama had an AK47 or his pecker in his hand, if I walked into that room, he would have caught a double tap in the noggin. I would have greased everyone with whom I came into contact. I would have buried that POS inside the body cavity of Hogzilla, in my back yard. I don't care if they were armed or not. If you hang with Osama, you can burn in hell with him.
All of the aforementioned said, I'm just a monger, not the POTUS. If I were the POTUS, I would have rescinded Executive Order 12333 just prior to the commencement of the op. I would then, prophylactically grant all members of Team 6 presidential pardons to protect them from prosecution within the US by liberals. When asked by the liberal media, I would say,"it doesn't matter if he was armed (non of the folks at the three sites of carnage on 9/11 were armed) or not, we were there to dispatch him with extreme prejudice. Are you {mr. Liberal media guy] pro Osama?" "You're pro-Osama? I think that the American people should know that [name of news outlet] is taking sides against the USA."
As it stands, it looks like Obama has violated Executive Order 12333 and many of the members of his administration (excluding Obama) have been actively and intentionally misleading the press and the public. The less he says the better. If he keeps yapping, team 6 is going to be the focus of a tribunal in den Hague and he is setting himself up to be impeached by the likes of Dennis Kucinich. [/QUOTE]Their problem is that the Navy SEALS lost the Miranda Warning cards that Holder gave them, so they had to improvise.
ROTFLMAO!
[QUOTE=Esten;417215]Stan, see below HGL's post and my added comments. And as you know unemployment is the highest in decades, and the poverty rate is at a 15-year high (and near a 40-year high) :[/QUOTE]Your post is a perfect example of why no one respects you here. You simply spout a bunch of mischief with no intention of supporting it, for obvious reasons. Here's what you said:
[QUOTE=Esten;416910]profits and wealth are increasingly accumulating in a small subset of the population. This is not happening without a cost. The trade-off is increasing unemployment, poverty and stagnating wealth for the middle class.[/QUOTE]So, I asked for support for something you claim "we all know," that the 'trade-off' to "wealth" accumulation by the rich is "increasing unemployment, poverty and stagnating wealth for the middle class."
The best you can do is argue that the rich make more today than before in relation to others? Where's the unemployment "we all know" this has caused? Where's the poverty "we all know" this has caused? I'm not sure what "stagnating wealth" means, but if it means that the middle class is doing as well as it was before, then I don't think I disagree. But, that certainly doesn't support [i]your[/i] Argument.
And HappyGoLucky's numbers certainly don't support your argument. Indeed, they undercut it.
He points to research by a liberal blogger, which he characterized as a "zinger" purporting to show that the adjusted for inflation median salary of the average American taxpayer is the same today as it was 20 years ago. Now, the underlying data is flawed, but let's take it at face value.
Do either of you understand what "adjusted for inflation" means? It means that these folks' purchasing power is the same. They're not in poverty, they're not worse off, economic policies have not caused them to decline or vanish. Your only argument is that it's not fair that these folks make as much as they did before, because others make more. But, that just gets us back to your standard class-envy socialist diatribe.
And, as I mentioned, the data you rely on is bogus. The data used by nearly everyone here is 'household income' not salaries. Why? Even in 1988, there were a far greater number of households with a single working spouse, and those households (then and today) overwhelmingly make up the bottom quintiles of income. But, if you look at median 'household income, ' you see that conditions have, in fact, improved. Using Happy's baseline period, median household income was $47, 251 in 1988 and it was $49, 777 in 2009 on an inflation-adjusted basis.
[url]http://www.davemanuel.com/median-household-income.php[/url]
That's 5% more in purchasing power [i]after being adjusted for inflation[/I] Than during 1988. And, that's measuring from boom times to recession (peak to trough) which is another problem with the data. Regardless, that's not stagnation; that's not poverty; and I'm still waiting for Esten to try to make any connection to unemployment. He can point to the fact that unemployment is bad, but there's no connection between that and the fact that the rich have more wealth. According to both of you, the rich have been getting richer for the past two decades. But, unemployment was historically very low during that time period. So, obviously, there is no correlation there. Where is there a correlation? Hey, you don't have too look far. Perhaps you might want to check into your President's foolhardy economic policies. More than anything else, they have caused the prolonged spike in unemployment.
About two years ago, the Obama Administration tried to start making a correlation between the Obama Presidency and the Reagan Presidency. It was a stretch, at best, particularly since the Obama campaign made it a point to chide anyone who believed in capitalism and said that the economy was proof that Reaganomics didn't work. Yet, a year into office, there was Obama trying to get mentioned in the same breath as Reagan.
Well, it's obvious now that Obama deserves mention, but only to contrast Obamanomics with Reaganomis. Obama and Reagan took office at remarkably similar times. They have deployed polar opposite policies and taken the country in opposite directions. Compare for yourself which one works and which one doesn't.
[url]http://blogs.forbes.com/peterferrara/2011/05/05/reaganomics-vs-obamanomics-facts-and-figures/[/url]
There's not much of an argument.
Yes, after two years of federal government under the control of Obama, Pelosi and Reid, the poverty and unemployment rates are at high levels. The USA has not bounced back from the 2008/2009 recession like it did from previous recessions -- see Stan's Forbes link below. And if the USA follows the same policies that Western Europe and Sweden did until recently, you can expect unemployment to remain at high levels. Esten, if you disagree with that last statement you're just not being realistic or reasonable.
The biggest reason for the disparities in wealth in the USA is that politicians, chiefly Democrats but also many Republicans, want a beholden underclass that will vote for them. They encourage people to spend with no thought for tomorrow. They encourage consumption and borrowing and discourage saving. They promote Ponzi schemes for social security and Medicare instead of having people put aside money for retirement, like in Singapore and Chile. The average American, and the lower middle class in the USA, have standards of living among the highest in the world. The reason they don't also have savings is because American government discourages it.
Everyday for the three weeks I having been checking on all the places for you to get Laid.
And only one or two have responded. Thank You!
Are you really getting off on Politics?
That is really Perverted.
This is One of the most civilized places to get laid.
I got a piece for US$25. And there a few left less expensive. I even gave a 10p tip.
I am on a fixed income. Social Security.
Are you really that frustrated, that you get off on Politics?
Find a massage place at home at least.
IF you do have one where you live, take trip to California. We have lots of Oriental girls. PM Me. But it is US$100.
Or at least come down here and tell me where I fucked on the prices on my Lists and I will buy you a free piece.
Come on take my bet. That should be easy, when my Spanish sucks.
I have listed over 100 privados, prove me wrong for this month and it is on me.
Jackson will cover my bet, because he owes me.
I fixed the his fucking leaky sinks, etc.
[QUOTE=Tiny12; 417261]Yes, after two years of federal government under the control of Obama, Pelosi and Reid, the poverty and unemployment rates are at high levels. The USA has not bounced back from the 2008/2009 recession like it did from previous recessions. See Stan's Forbes link below. And if the USA follows the same policies that Western Europe and Sweden did until recently, you can expect unemployment to remain at high levels. Esten, if you disagree with that last statement you're just not being realistic or reasonable.
The biggest reason for the disparities in wealth in the USA is that politicians, chiefly Democrats but also many Republicans, want a beholden underclass that will vote for them. They encourage people to spend with no thought for tomorrow. They encourage consumption and borrowing and discourage saving. They promote Ponzi schemes for social security and Medicare instead of having people put aside money for retirement, like in Singapore and Chile. The average American, and the lower middle class in the USA, have standards of living among the highest in the world. The reason they don't also have savings is because American government discourages it. [/QUOTE]
WT, I can sit down in front of my computer with a bottle of baby oil and the American Politics thread and it doesn't cost me anything. $0. That's right, zip, nada. And Esten really gets me hot. Don't knock it until you've tried it.
Thanks again for the lists, for Argentina and elsewhere. I have used and will use them.
[QUOTE=Stan the Man; 417250]Well, it's obvious now that Obama deserves mention, but only to contrast Obamanomics with Reaganomis. Obama and Reagan took office at remarkably similar times. They have deployed polar opposite policies and taken the country in opposite directions. Compare for yourself which one works and which one doesn't.
[url]http://blogs.forbes.com/peterferrara/2011/05/05/reaganomics-vs-obamanomics-facts-and-figures/[/url]
There's not much of an argument. [/QUOTE]Although there are similarities as to when Reagan and Obama came into office, I think the differences are much more significant. Reagan came into office during a expansion and Obama during a recession according to NBER. High inflation and interest rates when Reagan came into office and the threat of deflation and low interest rates when Obama came into office.
Really it depends where you are sitting in the economy as to your economic standing right now. I was laid off in the Reagan era, worked temp jobs for 18 months before finding something permanent. I actually faced a marginal tax hike when going back to work because the Reagan tax reforms eliminated income averaging.
Being older my wealth is in the stock market now. S&P 500 as measured by GSPX was 835 when Obama took office and now sits over 1300. Obama's policies favor large business over small business. S&P 500 companies have increased hiring since Obama has been in office but most of the hiring has been overseas. As David Bianco of Merrill Lynch keeps reminding us the S&P 500 is not the American economy. I know many small business owners that have been hurt and have not recovered under Obama's policies
What did you think of Kudlow's proposal to withdraw from Iraq and Afghanistan to reduce the budget?
[QUOTE=Big Boss Man;417275]Although there are similarities as to when Reagan and Obama came into office, I think the differences are much more significant. Reagan came into office during a expansion and Obama during a recession according to NBER. High inflation and interest rates when Reagan came into office and the threat of deflation and low interest rates when Obama came into office.[/QUOTE]I don't mean to quibble too much, but here goes:
First, I agree that no recession or economic period is identical. I also agree that interest rates were high when Reagan took office, and low when Obama took office. But, if you asked most presidents which they would choose to have when they took office, my guess is most would go with low interest rates. They're not considered much of a problem and can be managed easier. I know, tell that to Japan. Also, I don't believe the "threat of deflation" was an issue when Obama took office. That supposed threat came later, and it's one of those phantom economist specters. There's always a threat of anything.
Second, as to expansion and contraction, there still isn't much difference. We may have been contracting when Obama took office, but that stopped a scant five months after he took office, according the the NBER.
[url]http://www.marketwatch.com/story/us-recession-ended-june-2009-nber-says-2010-09-20[/url]
Reagan, on the other hand, dealt with a mini-Carter recession that ended in July of 1980, six months before he took office. But, things had been going to hell despite that technical end, which largely explains the results of that election and Carter's defeat after one term. You were alive during that time so I'm sure you can recall the gas lines, joblessness and high interest rates. As a consequence, six months after Reagan took office, another recession began in July of 1981. The expansion when Reagan took office lasted only six months. When Reagan killed the next recession, the expansion lasted a then-record 92 months.
That's the recession I'm talking about. Obama already has had longer to recover from the end of "his" recession but doesn't have the results to show for it. Of course, his term isn't up, so we'll just have to wait and see how it turns out in the end. Judging by the "start" of his expansion, though, it's not looking good.
Finally, the point in all this is not to say each period was / is the same. The point is that each period was seriously messed up. One President addressed it with supply side economics, while the current President turned to Keynesian principles. Again, there doesn't seem to be too much debate about what worked and what failed so far, unless your name is Paul Krugman. Even Krugman doesn't debate this so much as try to say that Keynesianism wasn't fully deployed. But, he has to say that. His life's work is meaningless if he doesn't. Indeed, Obama's latest Keynesian tactic was the payroll tax holiday, and it appears to have failed, as well.
[url]http://www.realclearmarkets.com/articles/2011/05/09/another_nail_in_the_keynesian_coffin_99010.html[/url]
I definitely agree that Obama's strategy has been to court and coddle big business at the expense of small and mid sized companies. I have personally seen this. There is one set of rules and credits for the GEs and Too Big To Fail Banks, and there is another set of rules and punishments for the community banks and the rest of us left to deal with ObamaCare. The TBTFs contribute generously to Democrats and have been rewarded under his watch. It's very much like defense contractors and Cheney, except no one on the right is howling like the folks on the left did. I wish they would.
[QUOTE=Big Boss Man;417275]What did you think of Kudlow's proposal to withdraw from Iraq and Afghanistan to reduce the budget?[/QUOTE]I tend to agree with him. These things can't happen over night. But, I would be in favor of a policy shift at this point toward getting the heck out of both places. Personally, I don't see it getting better in Afghanistan. This is the war Obama said we should be concentrating on. While I don't disagree, we've got our guy, and I don't think there's any more "objective" we can really achieve. If the goal is to defeat the Taliban or al Qaeda, that won't happen. They're ideologies, not nation states. Why stick around?
Regarding Iraq, I think the wind down has been going rather well. I'm not sure there's a need to accelerate that, so much as stay the previously outlined course to wind down. I do think that Obama and Biden owe an apology to Bush and Petraeus, especially after Obama voted against the surge and said we already had lost there. But, I'm not going to hold my breath for that apology.
I've said it here before and I'll say it again. I'm really not a critic of Obama's foreign policy. I think he's done a reasonable job there. It's his domestic policy that's a train wreck.
[QUOTE=Big Boss Man;417275]Being older my wealth is in the stock market now. S&P 500 as measured by GSPX was 835 when Obama took office and now sits over 1300. Obama's policies favor large business over small business. S&P 500 companies have increased hiring since Obama has been in office but most of the hiring has been overseas. As David Bianco of Merrill Lynch keeps reminding us the S&P 500 is not the American economy. I know many small business owners that have been hurt and have not recovered under Obama's policies [/quote]You are correct. Big companies have thrived with nearly free money (low interest) and pared headcount. Not too many of them are hiring despite very strong financial performance. I wonder why?
It is absolutely clear that Obama's policies are far better for the wealthy, indifferent for the poor and brutal on the middle class (19% un and underemployment).
[quote=]What did you think of Kudlow's proposal to withdraw from Iraq and Afghanistan to reduce the budget?[/QUOTE]Let's turn plowshares into butter. Ain't going to happen unless Bohner and company grow a pair. They could bring them all home tomorrow and government expenditures wouldn't drop one penny. Look at the fiscal trend coming out of any past war.
We have build an economy that is based on cosumerism, and so when the pockets are near empty, then buisnesses suffers in general. Lean times, as they say. No choice, but to balance the budget somewhat and somehow. Not just the national budget, but each household, too. I think that everyone agrees on this, even Congress. So what's all the shouting and gesturing over there, and even here. Yeah, I got it, it's all about the agendas and the elections.
Big Buisness are reeling in big numbers, so do they want people to stop buying?
My recent fact finding mission to Medellin was fun and interesting, reminded me of Thailand about 14 years ago until consumerism came plowing through, and the land was never the same again. Colombia is repeating the same scenario. Sometimes, you don't know whether to laugh or cry.
[QUOTE=Stan Da Man;417250]Your post is a perfect example of why no one respects you here. You simply spout a bunch of mischief with no intention of supporting it, for obvious reasons. [/QUOTE]Another salvo from the king of personal attacks. I'm crushed.
You should know by now, I do my research and I'll support, clarify or withdraw anything I say, as the case may be. I welcome your continued debate, so I can expose your flimsy rebuttals, just like with the Fannie and Freddie discussion.
[QUOTE]So, I asked for support for something you claim "we all know," that the 'trade-off' to "wealth" accumulation by the rich is "increasing unemployment, poverty and stagnating wealth for the middle class." [/QUOTE]The "we all know" part was about businesses existing to make a profit. Your string of quotes does not convey what I said.
[QUOTE]The best you can do is argue that the rich make more today than before in relation to others? Where's the unemployment "we all know" this has caused? Where's the poverty "we all know" this has caused? I'm not sure what "stagnating wealth" means, but if it means that the middle class is doing as well as it was before, then I don't think I disagree. But, that certainly doesn't support your Argument.[/QUOTE]More selective quoting. Please re-read what I said re: "we all know".
It appears you interpret my statement to mean the rich getting richer always has a causal link with poverty, unemployment and stagnating wealth. If so, your criticism is valid. They do not always occur together, and when they do, there is not always a causal link.
However my original statement was relative to today and the recent recession. And I said nothing about causality, only that there was a trade-off.
In recessions, unemployment and poverty increase while incomes stagnate (don't change much). The rich may take a hit too, but recover quicker. You recall I said before how corporations were sitting on $2 Trillion in cash, increasing dividends and buybacks while hiring little or none. This is little more than corporations and the rich elite that control them protecting and enhancing revenue streams back to the rich. Corporations could have chosen to invest in the economy and create jobs, or at least avoid layoffs and salary freezes. But instead many corporations, already profitable, chose to become even more profitable at the expense of workers. That's a trade-off.
The connection to unemployment is this: mass layoffs increased corporate profits, much of which is being distributed back to the rich through dividend hikes, buybacks and executive compensation. CEO pay now exceeds pre-recession levels, but unemployment is still high.
It ain't rocket science.
Now over the long run, let's take the past few decades, unemployment and poverty have basically stayed in narrow ranges of 5-10% and 10-15%. Adjusted for inflation, middle incomes have grown little. Your data supports this. But upper incomes have had huge gains. Pointing this out is not "class envy", just a statement of fact.
Remember the conservative talking point: when we grow the pie and allow the rich to prosper, it trickles down to others. But you've just acknowledged this isn't the case (or barely). Even as the pie grows, the wealthy are taking an ever-growing share of it. The more wealth is shifted up, the less remains for those below. That's a trade-off.
The CBPP link I referenced uses data from the CBO. Just as valid as your Census Bureau data. I guess it's easier to call it "bogus" than admit it supports my argument.
You cited an increase in median household income from $47,251 in 1988 to $49,777 in 2009 (+5%) as a sign of improvement. How about the 1989 to 2009 comparison: $48,463 to $49,777 (+2.7%). Or 1999 to 2009: $52,587 to $49,777 (-5.3%). Long-term, yes the overall trend is slightly positive, though the slope declined under Bush. If you want to call these meager gains as proof that incomes do not stagnate long-term, very well. But median gains are dwarfed by those of the top quintile and top 1 percent. Refer back to the CBPP article.
Liberals don't object to the wealthy having the biggest piece of the pie. What they object to is the trend of the [i]ever-increasing share of the pie[/i] the wealthy hold.
Mongers-
Check this article out. Get ready for "four more years"
[url]http://news.yahoo.com/s/ap/20110511/ap_on_re_us/us_ap_poll_obama_boost[/url]
Esten, It's interesting that your endpoint is always 2009, the end of one of the worst recessions since the 1930's. I suspect that if you looked at median household income at the ends of other recessions, for periods ending in 1982 or 1974 or 1931 you'd see something similar. Also, it's interesting that you go back to median household income as your preferred statistic again and again, even though Stan and others have pointed out that you should be using median income of individuals, to adjust for the effect of more families with one wage earner and smaller households.
You're a big believer in polls. From some of your posts, it almost seems that you think the USA should be run based on polls. In particular, you appear to be a big believer in the majority taking whatever it wants to from those who are well off, if that's what the majority wants to do. O. K, well, instead of looking at what individuals believe, how about taking a look at what governments are doing. With respect to your ideas about business in your last post, the majority of the world is headed in the opposite direction of where you want to take us. The exceptions I can think of are the USA under Obama / Pelosi / Reid, Venezuela, Nicaragua, Ecuador, Bolivia and Argentina. Spain under Zapatero and Greece would also be headed in the same direction if recent economic conditions hadn't interceded.
The former Soviet Union, Eastern Europe, Western Europe, China, and East Asia are trying to create conditions that are favorable for business, and cutting taxes on business. They encourage savings instead of pushing their companies and their people to spend, spend, spend. They've learned from their past failures, which you seem intent on having us repeat.
You are totally off base on your comments about dividends and cash in corporations. The problem the USA has is too much consumption and not enough savings, at the individual, corporate and government level. So USA corporations have 2 trillion in cash. How much debt do they have? A hell of a lot more. This absence of net savings results in the USA having large current account deficits, and on us not having the savings to fund investment so that we have to rely on China et al, and so that we don't have the investment to grow as fast as we could.
While indeed there are specific instances where companies lay off employees and increase dividends, you're not looking at the big picture. You undoubtedly are in favor of the marginal rate on dividends going back to 39.6%, as it's scheduled to on January 1, 2013. Almost all of the world either franks dividends, so that corporate income isn't taxed twice (once to the company and once to the shareholder) or has a lower tax on dividends than ordinary income. The dividend payout ratio in the USA (percentage of income paid as dividends) is low by worldwide standards. It's too low, the reason being that the tax system encourages companies to become overindebted (interest expense is tax deductible) instead of issuing equity (dividends are not deductible). Anyway, investment should be allocated to companies that produce high returns instead of those that reduce low returns. Dividends are one of the primary mechanisms by which this occurs. A company without opportunity for growth should distribute dividends. The shareholders reinvest this in companies with good opportunites for growth. Money flows, say, from textile companies to Boeing. If you are going to insist on companies retaining and reinvesting income instead of distributing dividends, a lot of money is going to be squandered on stupid investments.
The money that flows to pension funds and mutual funds and individuals in the form of dividends is miniscule compared to the money spent by corporations on labor. The following statement is a complete load of crap:
"The connection to unemployment is this: mass layoffs increased corporate profits, much of which is being distributed back to the rich through dividend hikes, buybacks and executive compensation."
For the record, I do believe that you, Obama, Pelosi and Reid are Democrats, and don't put you in the same category as Chavez, Ortega, Morales, or Correa. I do believe you have similar attitudes towards business though, and believe your policies will damage the economy. The reason I say "will", I believe this country is headed in the direction you want it to go, as evidenced by Rock Harder's post above.
HR, while it's a nice article about Obama's current popularity, the bounce is due to Osama getting a bullet in the noggin courtesy of the US Navy Seals. By the way I am still trying to figure out how according to the AG water boarding is torture but shooting an unarmed terrorist in the head is just fine. I'm sure Esten can explain it.
He should enjoy it while he can since it will be the last uptick in his ratings before the 2012 election. I am surprised it has lasted this long, but it will soon fade and his poll numbers and approval rating will once again plummet to the low 40's were they were before. Why, because he is doing his best to ignore the 900 pound gorilla in the room, the deficit, and that big monkey is getting pissed. That's the Gorilla not Obama.
Just around the corner is the debt ceiling debate and the 2012 budget, spending is still unchecked, unemployment went up to 9% again and the 'recovery' is in the process of stalling due to fuels costs.
The Democrats and Obama seem determined to run off the cliff in mass with their latest proposals. While gas prices continue remain at $4+ they are doing their best to:
1. Curtail domestic production by slow walking the permit process creating a de facto moratorium on drilling.
A. The federal judge in New Orleans just order the Fed to either deny or issue Gulf drilling permits in 30 days – then they are in contempt.
B. Stonewalling the process to permit new production in Alaska, which the citizens of Alaska want to go forward creating jobs and income for the state.
2. Punish those dirty old oil companies, at least the 5 that they have some control over, by removing certain tax deductions.
Wow, what brilliant thinkers! Now what do you think will happen to fuel costs as domestic production falls and the oil companies start passing on the cost of business which just got higher courtesy of the Democrats?
The only answer from the Democrats is to Tax Tax Tax and Spend Spend Spend and Borrow Borrow Borrow.
It's time to shut down many of the overreaching government programs and reduce the size of the government. I am well aware of the herculean task this represents but it needs to be done.
Ronald Reagan once said the closest thing to immortality he has ever seen was a government program. Time for the immortals to die.
Next Obama and Immigration Reform . The truth about the Border Patrol's orders from the guys in the field!
[QUOTE=Tiny12;417350]Esten, It's interesting that your endpoint is always 2009, the end of one of the worst recessions since the 1930's. I suspect that if you looked at median household income at the ends of other recessions, for periods ending in 1982 or 1974 or 1931 you'd see something similar. Also, it's interesting that you go back to median household income as your preferred statistic again and again, even though Stan and others have pointed out that you should be using median income of individuals, to adjust for the effect of more families with one wage earner and smaller households. [/QUOTE]Tiny, I stuck with the 2009 endpoint because that was Stan's endpoint. Regardless, as you may have noticed I did conclude the long term trend was slightly positive.
Individual or household income, either will do. If you think individual income is a better metric, post a link and let's see what it shows. And Stan did not point out to use individual income in his reply to me, in fact he posted a link to and discussed data on household income. So whaddya talking about? And furthermore, there is no reason that more one wage earner households would invalidate comparing trends in household income for low vs. high income households, unless shifts to one wage earner households were significantly different for low vs. high income households. I suspect such evidence is hard to come by.
[QUOTE]You're a big believer in polls. From some of your posts, it almost seems that you think the USA should be run based on polls. In particular, you appear to be a big believer in the majority taking whatever it wants to from those who are well off, if that's what the majority wants to do. O. K, well, instead of looking at what individuals believe, how about taking a look at what governments are doing. With respect to your ideas about business in your last post, the majority of the world is headed in the opposite direction of where you want to take us. [/QUOTE]I think polls are valuable (and interesting) to gauge what people are thinking. I don't always agree with them. I wouldn't say they should be used directly to run the country, but polls can and do have some influence on guiding politics and policy. I am a big believer in reversing (to some degree) the ongoing massive wealth accumulation at the top. You often reference other countries, but it seems you are not consistent in whether you suggest we follow or not follow what they do. As you may have noticed, I care little about what other countries are doing.
You don't understand where I "want to take us.". If you did, you would remember I posted before I am a big believer in balanced budgets. I want the USA to get to a balanced budget (and start reducing debt) much quicker than the timeframes we are hearing out of DC. I favor an approach that includes both raising revenues and cutting spending.
[QUOTE]You are totally off base on your comments about dividends and cash in corporations. The problem the USA has is too much consumption and not enough savings, at the individual, corporate and government level. So USA corporations have 2 trillion in cash. How much debt do they have? A hell of a lot more. This absence of net savings results in the USA having large current account deficits, and on us not having the savings to fund investment so that we have to rely on China et al, and so that we don't have the investment to grow as fast as we could.[/QUOTE]Tiny, please. It is very obvious what is going on with large, profitable public corporations. Cutting to the bone (and sometimes deeper) to funnel more and more cash back to executives and shareholders (AKA the wealthy, for the most part).
You raise a good point about debt. It really begs the question - why are profitable corporations more focused on raising dividends and executive compensation, than paying off debt?
As far as dividends going back to 39.6%, that day can't come soon enough. I do hope Obama doesn't bend on that one.
Esten, I took WT69's advice. I just got laid. Honestly. I'm happy and content. I love you Esten!
And you can spin anything any which way you like.
I believe I was the first to commend BHO for nailing UBL. It is the first incidence, since his election, in which it was clear to me that he was doing his job (however reluctantly (IMO) he made that choice). That said, most of the polls only show him getting a 1-3% bump out of the successful, targeted assassination of UBL. The AP poll is pretty sophomoric, only to be outdone by its own shoddy reporting of its own poll.
Not until the very end, in an after thought that isn't even within the prose of the article, do you get this:
"Still, his re-election is far from certain. And there are warning signs in the poll.
_Nearly two-thirds of people — 61 percent — disapprove of his handling on gas prices, even though there's little a president can do about them.
_Less than half give him positive marks on dealing with the federal budget deficit or taxes, two big upcoming issues."
So clear majorities disapprove of his handling of the economy, deficit, spending, taxes and the price of gas (which is 100% his fault since it is the falling dollar and not the rising cost of oil that is the problem). Gee, he should have no problem winning in 2012, when the price of a gallon of gas should be over $5 and unemployment will be somewhere between 8. 5.10. 5.
No matter what the polls and media say, you can't fool the people into believing that their day-to-day existence is other than what it really is. The week before BHO was inaugurated, it cost me about $38 to fill my gas tank. This morning, it cost me $80 to fill that same gas tank. The housing market is re-crashing, consumer credit is a thing of the past and prices of virtually all staples have risen dramatically (again Obama's fault for diluting the dollar).
GHW Bush was at a 91% approval rating (amazing that the press even printed that information) on the bump from the first Iraq War and was considered unbeatable so all of the big-name democrats bailed out of the race. Some no-name from Arkansas, who didn't have the sense to come in out of the rain, stuck it out and beat Bush (thanks in large prat to Ross Perot) and got a second term, four years later.
If the election was held today, anyone from Elmer Fudd to Homer J. Simpson could beat Obama, including both Newt and Sarah Palin (yep, read it and weep). No matter what the press says, the truth is you can't put UBL's dead carcass in your gas tank. UBL's passing isn't reducing the rates of unemployment and underemployment.
Anyone telling you that Obama is a shoe-in is a liar and / or living in a fantasy world.
Just a note, the composition of of the poll by AP's own admission is 39% declared Democrats and 18% declared Republicans, a 2 to 1 margin. Talk about cherry picking and rigging the game!
Tiny, you need to get laid more often...
The pathetic display of Big Oil executives before the Senate finance committee today is a perfect example of the choices large corporations have.
Take Exxon. Exxon makes close to 40B profit a year. Ending the tax breaks in question would reduce Exxon's profits by less than 1B. A small hit, but a hit nevertheless.
Exxon could choose to respond to this by slightly scaling back future dividend hikes (which they have raised for 29 consecutive years). Or by slightly scaling back future share buybacks. But no, for these hugely profitable companies, that is simply out of the question. CEO Rex Tillerson instead frames it as an inevitable downside for Americans:
[QUOTE]“By undermining US competitiveness, [the tax changes] would discourage future investments in energy projects here in the US and therefore undercut job creation and economic growth,” [/QUOTE]He follows up that bs with this whopper:
[QUOTE]I don’t think the American people want shared sacrifice. I think they want shared prosperity.[/QUOTE]Meanwhile, this joker just cashed in 17M worth of stock earlier this year. This guy is too much.
As I understand it, Congress intends to treat the 5 largest oil companies differently from every other company in the USA. That's not fair. These "tax breaks" are available to all U.S. companies, not just oil companies.
Several of my friends were laid off by oil companies, because the companies were barely profitable or losing money from 1986 to 2000. I can think of 5 that were laid off by the majors that are the target of Congress right now. (A popular joke at the time: What do you call a geologist in Oklahoma City? Waiter!) Why do you want to preferentially screw people and companies in that industry and communities in places like Texas, Louisiana and Wyoming? Why do you think it's fair to take "excess" profits from commodity producers when the price of the commodity is high, but then tell them to go f___ themselves when the price is low?
And the CEO's were absolutely right in their testimony today. Higher taxes on oil producers in the USA will cause the USA to import more oil, to run a higher current account and trade deficit, and it will result in lower employment in the USA. If you are correct in saying that this will just effect Exxon to the tune of $1 billion then perhaps it is a small hit, AS LONG AS OIL STAYS OVER $90 A BARREL. But if $1 billion is a drop in the bucket, how significant is the $17 million that Tillerson is getting? And I still maintain it's not fair to treat these companies differently from other ones.
Esten, CNBC, which has conservative viewers, ran a poll today. 68% were on your side, saying Congress should punish the oil companies. Regardless of how this issue shakes out, that makes me damn glad there's a Constitution. I was at one time a card carrying member of the ACLU by the way. While that may seem totally unrelated to the matter at hand, the majority at times can be stupid, mean and vindictive, and there needs to be something standing between them and mob rule.
[QUOTE=Esten; 417386]The pathetic display of Big Oil executives before the Senate finance committee today is a perfect example of the choices large corporations have.
Take Exxon. Exxon makes close to 40B profit a year. Ending the tax breaks in question would reduce Exxon's profits by less than 1B. A small hit, but a hit nevertheless. [/quote]You are ignoring several relevant facts (no surprise there). First, Exxon paid more than $78. 6B in taxes, worldwide including $15B in income taxes (to foreign governments) and more than $7. 7B of taxes (mostly sales taxes) paid to the US government. Their effective tax rate was more than 47%.
This doesn't include the US fuel excise tax paid by the customer. 18. 4 cents / gal for unleaded and 24. 4 cents / gal for diesel. Including state taxes, the total average excise taxes on gas, nationally, averages 49. 5 and 45. 6 for unleaded and diesel, respectively.
You are absolutely wrong on ever aspect of your argument. Hit the oil companies with more taxes and it goes straight to the customer, which will add to the inflation that your God has wreaked upon us.
If you're so pissed about profiteers paying no taxes, why not get on you soap box about GE?
[quote=]Exxon could choose to respond to this by slightly scaling back future dividend hikes (which they have raised for 29 consecutive years). Or by slightly scaling back future share buybacks. But no, for these hugely profitable companies, that is simply out of the question. [/quote]Why? Because a 47% effective tax rate isn't high enough? They are among the highest taxed industries on the planet. One of the major reasons that their profits are so high is that their revenue is denominated in OIL. If the value of the dollar falls, holders of dollars must pay more for the same amount of fuel. If their expenses are denominated in dollars, they (expenses) effectively go down while revenues rise (even without selling any more fuel). You want to know why their profits are so high? OBAMA! He's the one diluting the dollar.
[quote=]CEO Rex Tillerson instead frames it as an inevitable downside for Americans:
He follows up that bs with this whopper:
Meanwhile, this joker just cashed in 17M worth of stock earlier this year. This guy is too much. [/QUOTE]His company is shooting the lights out, in part due to Obama, why shouldn't he get paid more for delivering record profits? I thought the object was to do better and reward success.
If you want to be mad at someone for earning money for nothing, be mad at Obama for the more than $10 million he has received for books he didn't write and hasn't written yet. At least Tillerson showed up to work and did the job for which he was paid.
You are a joke and an ideologue. You will never learn because you have closed your mind to information, facts and reality.
"Your revolution is over, Mr. Lebowski. Condolences. The bums lost. My advice is to do what your parents did; get a job, sir. The bums will always lose. Do you hear me, Lebowski?"
[QUOTE=Tiny12;417387]As I understand it, Congress intends to treat the 5 largest oil companies differently from every other company in the USA. That's not fair. These "tax breaks" are available to all U.S. companies, not just oil companies.[/quote]They aren't going to change thing. This whole thing is DOA. This theatrical performance is just that. It's all bullshit designed to be a distraction from the truth. It couldn't pass the Senate, let alone the House. It's just the Democrat-controlled Senate wasting time for partisan purposes over an imaginary $4B while they are directly responsible for their involvement in putting the country $14B in debt.
[quote=]Several of my friends were laid off by oil companies, because the companies were barely profitable or losing money from 1986 to 2000. I can think of 5 that were laid off by the majors that are the target of Congress right now. (A popular joke at the time: What do you call a geologist in Oklahoma City? Waiter!) Why do you want to preferentially screw people and companies in that industry and communities in places like Texas, Louisiana and Wyoming?[/quote]'cause they don't vote for BHO.
[quote=]Why do you think it's fair to take "excess" profits from commodity producers when the price of the commodity is high, but then tell them to go f___ themselves when the price is low? [/quote]'cause he ain't smart enough to know better and is an ideologue.
[quote=]And the CEO's were absolutely right in their testimony today. Higher taxes on oil producers in the USA will cause the USA to import more oil, to run a higher current account and trade deficit, and it will result in lower employment in the USA.[/quote]Plus higher fuel prices, inflation, unemployment and despair. Just what BHO wants as he recasts the country to his vision of Amerika.
[quote=]If you are correct in saying that this will just effect Exxon to the tune of $1 billion then perhaps it is a small hit, AS LONG AS OIL STAYS OVER $90 A BARREL. But if $1 billion is a drop in the bucket, how significant is the $17 million that Tillerson is getting? And I still maintain it's not fair to treat these companies differently from other ones.[/quote]They would tax all fuel, therefor all companies and the cost to consumers would be many times the laughable and extremely poorly thought out estimate by the local BHO political officer. It only matters that it is fair in the eyes of our glorious leader.
The poor, suffering and dying minions forces into gulags under Stalin, viewed him as a deity and believed that he would be their savior. They also believed that Stalin must not know of their interment because he would never let it be, if he was aware of their plight. They died still believing.
[quote=]Esten, CNBC, which has conservative viewers, ran a poll today. 68% were on your side, saying Congress should punish the oil companies. Regardless of how this issue shakes out, that makes me damn glad there's a Constitution. I was at one time a card carrying member of the ACLU by the way. While that may seem totally unrelated to the matter at hand, the majority at times can be stupid, mean and vindictive, and there needs to be something standing between them and mob rule. [/QUOTE]
Just goes to show you how stupid CNBC's viewership is.
WW,
In summary, you are trying to say that Obama is stupid enough to want to "self destruct" for 2012?
Exxon 2010 worldwide income before taxes was 57B. This includes 7.7B US income, on which it paid 1.3B in federal income taxes. So the effective rate was 17%.
This compares well with another report showing Exxon had an average 17.6% federal effective corporate tax rate on its annual earnings in the three years spanning 2008 to 2010.
[url]http://www.washingtonpost.com/business/economy/how-much-do-oil-companies-really-pay-in-taxes/2011/05/11/AF7UNutG_story_1.html[/url]
[url]http://www.americanprogress.org/issues/2011/05/tax_man.html[/url]
Back in 2005, President Bush explained that the profit potential in the oil industry drives exploration, not the subsidies:
[QUOTE][i]“With $55 oil we don’t need incentives to the oil and gas companies to explore. There are plenty of incentives.”[/i][/QUOTE]In 2005 Sen. Ron Wyden asked each CEO if he agreed with President Bush that companies did not need tax subsidies to encourage drilling when oil was selling for that price. Each said Bush was right and that subsidies were unnecessary.
Now in 2011 with $100 oil, these same executives now defend federal tax subsidies. A complete about-face from what these jokers said in 2005. With low corporate tax burdens and high oil prices there is simply no reason to continue them.
To defend these subsidies, which most Americans do not support, is hollow and disgraceful.
In 2010, Exxon paid $9. 8 billion in USA taxes and received $7. 5 billion in net income from the US. Exxon's overall income tax rate (worldwide) was 40.7% of pre-tax income.
In 2009, Exxon paid $7. 7 billion in USA taxes and received $3. 5 billion in net income from the US. Exxon's overall income tax rate (worldwide) was 43.5% of pre-tax income.
In 2008, Exxon paid $13. 3 billion in USA taxes and recieved $8. 6 billion in net income from the US. Exxon's overall income tax rate (worldwide) was 43.8% of pre-tax income.
"Taxes" above include income taxes, property taxes, and severance taxes. I'd point out that only oil and gas companies are subject to severance tax -- other American businesses do not pay this tax.
You are calling tax deductions "subsidies". American businesses should not receive subsidies or preferential tax deductions. I'm all for eliminating all of them and lowering the corporate income tax rate from the current ridiculously-high rate of 35% to 45%. (The total percentage, federal plus state, varies depending on the state.) If you listened to the hearings last week, you'd know that Tillerson and one or two of the other CEO's of major oil companies indicated they'd have no problem with certain of the Democrat Senator's proposals, if they were applied to all of American industry.
[QUOTE=Black Shirt; 417407]WW,
In summary, you are trying to say that Obama is stupid enough to want to "self destruct" for 2012? [/QUOTE]I don't think that I have ever said Obama is stupid. He clearly isn't and wasn't smart enough to get into Columbia or Harvard law on his own cerebral merits but, that's another issue all together.
He is an ideologue and possibly a narcissist. It isn't that he is stupid it is that he can't help himself.
Here is how the election will be framed next year: unemployment of 8.5 to 10% (depending upon what accounting tricks they try) and gas prices over $5 per gallon. In my opinion, no incumbent president would survive those numbers. Ask yourself, are you better off today or four years ago (adjusting for time, of course)? If Obama wants to eliminate those two elements from the debate and secure a second term, he will need to repudiate that for which he stands. I see that as unlikely. It is far more likely that he will just try to blame republicans for all the damage that he has done to the country and vilify the citizenry of known red states. In my opinion, this won't work.
He is too little a man to admit that he is wrong. In the end, that is what will deny him a second term.
Just FYI to all our liberal friends. Exxon, the company not the monger, makes the about 7 cents a gallon profit on regular gasoline while the Federal Government taxes that same gallon of gasoline at 18. 4 cents. Seems the Fed is making over 150% more on every gallon of gas than the folks producing it. Of course they also get to tax the oil companies as well.
Estan I can tell by your posts you have no knowledge about accounting in the oil patch. I also doubt you have any idea of what it takes to produce a single gallon of gas. Be nice if you knew what you are talking about.
I don't normally submit cut and paste, but the following excerpt is the best summary I've seen of the cause of the residential housing market collapse and, thus, the current recession. The author was on the financial crisis inquiry commission, headed by Phil Angelides. Anyone familiar with California politics knows who Phil Angelides is: Member of the boards of CALPERS and the California Teachers pension fund, as well as former California State Treasurer. If you had to count on one hand the five worst run public institutions in terms of finances, these three would be on that hand. So, obviously, Democrats thought this made him qualified to head the Financial Crisis Inquiry Commission. If it takes a thief to catch a thief, then surely one boob can spot another. Such is the state of these half-wits.
At any rate, here's the excerpt:
[quote]From the beginning, Fannie and Freddie's congressional charters required them to buy only mortgages that would be acceptable to institutional investors. In other words, prime mortgages. At the time, a prime mortgage was a loan with a 10-20 percent down payment, made to a borrower with a good credit record who had sufficient income to meet his or her debt obligations after the loan was made. Fannie and Freddie operated under these standards until 1992.
The 1992 affordable housing goals required that, of all mortgages Fannie and Freddie bought in any year, at least 30 percent had to be loans made to borrowers who were at or below the median income in the places where they lived. Over succeeding years, the Department of Housing and Urban Development (HUD) increased this requirement, first to 42 percent in 1995, to 50 percent in 2000, and finally to 55 percent in 2007. It is important to note, accordingly, that this occurred during both Democratic and Republican administrations.
At the 50 percent level, Fannie and Freddie had to acquire at least one goal-eligible loan for every prime loan that they acquired, and since not all subprime loans were goals-eligible Fannie and Freddie were in effect required to buy many more subprime loans than prime loans to meet the goals. As a result of this process, by 2008, Fannie and Freddie held the credit risk of 12 million subprime or otherwise risky loans. Almost 40 percent of their single-family book of business.
But this was not by any means the full extent of the problem. HUD took Congress's enactment of the affordable housing goals as an expression of a congressional policy to reduce underwriting standards so that low-income borrowers would have greater access to mortgage credit. As outlined in my dissent, by tightening the affordable housing goals, HUD put Fannie and Freddie into competition with the Federal Housing Administration (FHA) , a government agency with an explicit mission to provide credit to low-income borrowers, and with subprime lenders such as Countrywide, that had pledged to reduce underwriting standards in order to make more mortgage credit available to low-income borrowers. Moreover, all these organizations were joined by insured banks and S&Ls, which as noted above were required under the CRA to make mortgage credit available to borrowers who are at or below 80 percent of the median income in the areas where they live.
Of course, it is possible to find borrowers who meet prime loan standards among low-income families, but it is far more difficult to find such loans among these borrowers than among middle-income groups. And when Fannie, Freddie, FHA, subprime lenders like Countrywide, and insured banks and S&Ls are all competing to find loans to borrowers in the low-income category, the inevitable result was a significant deterioration in underwriting standards.
So, for example, while one in 200 mortgages involved a down payment of 3 percent or less in 1990, by 2007 it was one in less than three. Other credit standards had also declined. As a result of this government-induced competition, by 2008 19. 2 million out of the total of 27 million subprime and other weak loans in the USA financial system could be traced directly or indirectly to USA government housing policies.[/quote][url]http://spectator.org/archives/2011/05/13/the-true-story-of-the-financia[/url]
After reading this, and thinking about the housing market, you might ask yourself: Why hasn't the commercial market suffered similar difficulties? After all, those loans frequently are packaged up just like the residential market. If was the greedy baddies on Wall Street who were responsible, why can't the same problems be found on the commercial side? Sure, things have declined, but nothing like on the residential side.
The answer is that the commercial side didn't have the market distorting government regulations, and didn't have multiple government agencies set up to promote a multi-trillion dollar social and vote getting agenda.
I know the above won't convince some. But, those people are lost already and won't be convinced no matter what the caliber of the smoking gun.
The final travesty in all this is that Dodd Frank and Obama haven't seen fit to even try to fix the cause of this problem. Fannie and Freddie lose billions each month while Barney Frank and the Dems look for the "real killers" just like OJ.
[QUOTE=Stan the Man; 417440]After reading this, and thinking about the housing market, you might ask yourself: Why hasn't the commercial market suffered similar difficulties? After all, those loans frequently are packaged up just like the residential market. If was the greedy baddies on Wall Street who were responsible, why can't the same problems be found on the commercial side? Sure, things have declined, but nothing like on the residential side.
The answer is that the commercial side didn't have the market distorting government regulations, and didn't have multiple government agencies set up to promote a multi-trillion dollar social and vote getting agenda. [/QUOTE]LOL. I barely have to lift my pinkie to refute this. Go back to my 10-05-10 post on the housing bubble (below). There [i]was[/i] a commercial real estate bubble. A big one. And the right-wing argument about the GSEs is largely about their role in creating the bubble. It was the financial sector leverage to the bursting bubble that created the credit crunch and ensuing deep recession.
The latest news is that the HUD inspector general has found that large banks defrauded the FHA and violated the False Claims Act. These banks played a major role in the housing bubble and recession, and then, unbelievably, [b]continued[/b] to screw the country through widespread improper foreclosures.
Ain't free-market capitalism great....
[QUOTE=Esten; 412937]5. In addition, commercial real estate also experienced a giant bubble over the same period, but CRE is outside the scope of the GSEs. This provides evidence of a broad-based bubble fueled by other market forces, such as speculation.
[url]http://mit.edu/cre/research/credl/rca.html[/url]
[/QUOTE]
Very noteworthy last week was Exxon CEO Rex Tillerson's explanation for the rise in oil prices. I give him credit for being honest about it. With such a huge run-up in price over the past year, common sense would tell you there must be more in play than just supply and demand. But that didn't stop the right wing from peddling their explanation that it was all Obama's fault, for not supporting domestic production. Another crock, just like Fannie and Freddie.
ExxonMobil CEO Says Oil Price Should Be $60 To $70 A Barrel.
[url]http://blogs.forbes.com/robertlenzner/2011/05/14/exxon-mobil-ceo-says-oil-price-should-be-60-70-a-barrel/[/url]
[QUOTE]Rex Tillerson, the boss of ExxonMobil admitted last week that the price of oil–based purely on supply and demand- should be in the $60 to $70 a barrel range. The reason it’s above $100 a barrel, Tillerson explained, is due to the oil majors using futures contracts to lock in current high prices, and speculation that is engineered by the high-frequency trading of quantitative hedge funds.[/QUOTE]
Esten, if your goal is to stop profiteering via oil futures speculation, it's pretty simple. You could stop it dead in its tracks by drastically increasing the margin required for the futures purchase.
For the life of me I can not see why you are so opposed to domestic production. California, Florida and the east coast should be opened to exploration. Did you know natural seepage from the oil deposits along the California coast releases as much oil each year as the Exxon Valdez incident in Alaska?
Doubt it? Go take a look at the seepage off San Diego and San Francisco alone.
Also all the hoopla from Obama about expanding leases really does not amount to much, since the lease only gives the company the right to attempt to locate petroleum and is no guarantee of finding it.
[QUOTE=Esten;417447]Very noteworthy last week was Exxon CEO Rex Tillerson's explanation for the rise in oil prices. I give him credit for being honest about it. With such a huge run-up in price over the past year, common sense would tell you there must be more in play than just supply and demand. But that didn't stop the right wing from peddling their explanation that it was all Obama's fault, for not supporting domestic production. Another crock, just like Fannie and Freddie.[/QUOTE]You're right, to an extent. However, please realize that discouraging oil and gas production in the USA would have a significant effect on the trade balance. If we were ever able to become self sufficient in energy, I suspect that would pretty well wipe out the current account deficit. Also please note that West Texas Intermediate has been selling at a $10 to $15 per barrel discount to Brent (European) crude in recent months. I believe this is in large part due to increasing oil production in North Dakota.
If, say, the EPA were to effectively ban hydraulic fracturing, and I suspect there are those in the Obama administration who'd like to do that, the effect on our energy self sufficiency would be profound. Development of oil resources would be effected, but natural gas would be a much bigger problem.
[QUOTE=Esten; 417447]Very noteworthy last week was Exxon CEO Rex Tillerson's explanation for the rise in oil prices. I give him credit for being honest about it. With such a huge run-up in price over the past year, common sense would tell you there must be more in play than just supply and demand. But that didn't stop the right wing from peddling their explanation that it was all Obama's fault, for not supporting domestic production. Another crock, just like Fannie and Freddie.
ExxonMobil CEO Says Oil Price Should Be $60 To $70 A Barrel.
[url]http://blogs.forbes.com/robertlenzner/2011/05/14/exxon-mobil-ceo-says-oil-price-should-be-60-70-a-barrel/[/url]
[/QUOTE]It is news worthy that since the week before Obama was inaugurated, spot oil prices vs. The dollar have increased a whopping 200. This is a great statistic to hang around the president's neck. It has nothing at all to do with 'speculators' and everything to do with this President's policies.
Market demand for oil has not appreciably increased over the past two years due to the global effects of Obama's Great Recession. Similarly, actual, current oil supply has not been drastically reduced (although Obama is doing his best to reduce it) , however, long-term production expectations have been damaged by this administration.
What has changed is the value of the dollar relative to the value of oil. The value of oil has remained steady while the value of the dollar has fallen. Therefore, it takes more dollars to buy a gallon of gas.
The cost of an ounce of gold and a pound of coffee have similarly increased 84% and 160, respectively. The price of a barrel of oil, expressed in ounces of gold, when the breadth and scope of the quantitative easing and loose monetary policy were becoming more evident (circa Jan 2010) , was. 0674 ounces of gold equaled one barrel of oil. In May 2011, a barrel of oil cost. 0741 ounces of gold or an increase of 3. 3% in the cost of oil versus gold. Therefore, the price of oil is maintaining its value as a rare and demanded global commodity while the value of the dollar, relative to the value of oil, has fallen. All the speculation has done is maintain oil's value in line with other valuable commodities.
By the way, it is of no consequence what an individual oil exec thinks the price of oil 'should' be nor does it establish the effect of speculators. The CEO of Shell believes, and is making long-term decisions based upon the premise that prices will stay above $100 / barrel.
[QUOTE=Wild Walleye;417453]The CEO of Shell believes, and is making long-term decisions based upon the premise that prices will stay above $100 / barrel.[/QUOTE]Exxon under both Raymond and Tillerson has been pessimistic about the future price of oil. Raymond was predicting $20 / barrel for about right now.
Doppel, I don't recall weighing in before on domestic oil production. I am not strongly opposed to it. What I do feel strongly about is (i) it should not be done in a way that takes us on a path to depleting our resources much faster than other countries, and (ii) it should be accompanied by large investments in renewable energy.
As far as higher margin requirements, I'm no expert here but seemed to work for silver. Unclear to what extent recent margin hikes for crude oil are responsible for the recent price drop. There should be pressure to limit speculation and keep oil / gas prices down up to the 2012 elections, time will tell whether that is successful or not.