If Obama is elected President, my guess is that he will want to do something that will make a big splash with those special interest groups who got him elected. Bill Clinton did it with his executive order approving "gays in the military." Of course, with that debacle, public opinion forced Clinton back down and, as result, we wound up with the ever-controversial "Don't Ask, Don't Tell" policy for gays in the military.
My guess is that Barack Obama will reward the labor unions for all their hard with an executive order "or" his signature on a Congressional bill that instates the "Card Check System" for unionizing businesses and corporations. The Card Check System will eliminate more than 60 years of secret balloting in deciding whether or not a company's employees wish to unionize. Instead, a union representative will confront each prospective company employee for an "oral vote" as to whether or not that employee wants to join a union. The result of that face-to-face vote will be "check off" on a card; followed by a signature of that employee. The union bosses will have possession and control of all the cards that are taken in the process. As soon as 51 percent of the employees "Card Check" to indicate that they want to unionize, the company is said to be automatically unionized. There will be no company wide vote. No union representatives can be barred from "talking" to any company's employees; either on or off working time or work hours.
To make the elimination of the secret balloting system more palatable in the minds of the American public, the Democrats have come up with the very democratic-sounding name of the Employee Free Choice Act (EFCA). I guess they learned this trick when they decided to drop all references to the word abortion by cooking up today's widely used term of "Pro-Choice" to indicate being pro-abortion. But, make no mistake about it, and with no Obama-like insult to Sarah Palin, this is truly like putting lipstick on a pig. There is absolutely nothing "Free Choice" about having a system that could result in union retaliation against those who voted "no" when the union bosses absolutely know how each and every person voted. This system is totally ripe for the extortion of employees by other union workers and the union leadership; either before or after the company has become unionized. By its very nature, the Card Check System is designed to be a form of psychological and, possibly, physical intimidation.
Sadly, this new law of Congress will probably go untested in the courts because even our own Constitution doesn't specify "secret balloting" for elections. The fact that we have "secret ballots" for any elections in America is only due to state constitutions which have been amended over the years. Prior to that, voting was done orally as in the Card Check System and as it is still done in many caucus voting systems during the primaries; and you only have to have listened to Bill Clinton to know he thought that the caucuses were riddled with problems (See the story and video). Even former Democratic Senator and presidential candidate George McGovern has come out vehemently against the "Free Choice" law because of the intimidation factor (click to see video).
Certainly, the Card Check System will benefit the labor unions which have been losing membership over the years. And, if Mr. Obama wins he can thank the unions like the SEIU and AFL-CIO for his win. Whether a new President Obama uses the "Free Choice" Act as his payback or something else, there will be a payback to some group and it will be done very early in the first month or month-and-a-half of his Administration. Just mark my words.
Friday, October 31, 2008
Thursday, October 30, 2008
And So...The Recession Is Really Here!
Last month, in this blog, I thought we could see a mildly positive Gross Domestic Product ("GDP") for this last quarter that ended in September. However, this morning's numbers proved me wrong with a small contraction of our economy and a GDP number that fell 3-tenths of one percent (See Full Story) . In an economy that is so big and is so diverse as ours, a 3-tenths of a percent fall in growth is a big thing. Normally, a weakness in one or two or more areas of our economy can be covered up by by strength in others. Up until now, our weak U.S. dollar had kept our economy going with increased exports of American-made products. But that all changed in September as the dollar started to strengthen. The strengthening drove oil prices down but, at the same time, it made our products more expensive in the world. Previously, our export strength had masked the weakness in our own consumer's buying habits. Now, as that referenced news article points out, the drop in GDP is clearly seen as being driven by a fall in consumer spending as our export advantage is being reversed. I don't think that anyone can deny that September's revelations of the extent of the credit crisis took its toll by scaring the hell out of America's consumers and the rest of the world.
As a clear example of this, yesterday, I went to one of those big-box-store anchored shopping malls to pickup some prescriptions. At 10:30 in the morning, the parking lot was pretty empty in comparison to just a few months ago. Consumer's are afraid. They are afraid to buy because they just don't know what is happening to the economy and their jobs. I live in Las Vegas and the jobs here are almost exclusively driven by non-essential entertainment spending from consumers visiting from all over the world. More than anywhere else in this country, travel to, and spending in Las Vegas, becomes expendable when the consumer gets spooked. It happened after "9/11" and it is happening now. While the national unemployment is 6.1 percent, the unemployment here is over 7 percent and climbing. To some extent, Las Vegas is truly the canary in the coal mine and this canary is definitely looking sick.
Some experts predict this recession could be deep and very prolonged. Others seem to think that the efforts put forth by the Treasury Department and the Federal Reserve and other world banks will kick in and confine it to a short-lived, two or three quarter event. I don't think anyone really knows what will happen because we don't know what will happen with our new government in January. If taxes are raised in the midst of a recession, it could be a very prolonged event; possibly even a depression. If the Congress and new President show restraint, and possibly provide another stimulus to the consumer, alone, this along with the massive bailout spending could make a less hurtful economic crises. However, if the Democrats decide that "infrastructure spending" would be a good stimulus, then forget it. That is being done for union jobs and nothing else. New projects for infrastructure will literally take months to develop, engineer, bid-out, start, and complete. To think a 1930's style WPA program of infrastructure rebuilding/building will kick-start an economy that is already in recession is totally mindless. These are the "same" politicians who claim drilling for oil will take "too long" to bail us out of an energy shortage! I've got a clue for these people. Excessive taxes and massive federal spending delayed the recovery from the Great Depression and it will delay the recovery from any economic downturn we find ourselves in in 2009.
As a clear example of this, yesterday, I went to one of those big-box-store anchored shopping malls to pickup some prescriptions. At 10:30 in the morning, the parking lot was pretty empty in comparison to just a few months ago. Consumer's are afraid. They are afraid to buy because they just don't know what is happening to the economy and their jobs. I live in Las Vegas and the jobs here are almost exclusively driven by non-essential entertainment spending from consumers visiting from all over the world. More than anywhere else in this country, travel to, and spending in Las Vegas, becomes expendable when the consumer gets spooked. It happened after "9/11" and it is happening now. While the national unemployment is 6.1 percent, the unemployment here is over 7 percent and climbing. To some extent, Las Vegas is truly the canary in the coal mine and this canary is definitely looking sick.
Some experts predict this recession could be deep and very prolonged. Others seem to think that the efforts put forth by the Treasury Department and the Federal Reserve and other world banks will kick in and confine it to a short-lived, two or three quarter event. I don't think anyone really knows what will happen because we don't know what will happen with our new government in January. If taxes are raised in the midst of a recession, it could be a very prolonged event; possibly even a depression. If the Congress and new President show restraint, and possibly provide another stimulus to the consumer, alone, this along with the massive bailout spending could make a less hurtful economic crises. However, if the Democrats decide that "infrastructure spending" would be a good stimulus, then forget it. That is being done for union jobs and nothing else. New projects for infrastructure will literally take months to develop, engineer, bid-out, start, and complete. To think a 1930's style WPA program of infrastructure rebuilding/building will kick-start an economy that is already in recession is totally mindless. These are the "same" politicians who claim drilling for oil will take "too long" to bail us out of an energy shortage! I've got a clue for these people. Excessive taxes and massive federal spending delayed the recovery from the Great Depression and it will delay the recovery from any economic downturn we find ourselves in in 2009.
Obama's Push For Early Voting
Not a single campaign rally goes by where Barack Obama doesn't tell his crowds to "vote early" and get their neighbors to vote early too. Certainly, whether you vote now or whether you vote on election day, your vote would be counted the same either way. So then, why the big Obama push to vote early?
I really think the reason is because the Obama campaign is worried. He knows that once you vote you can't take it back. The Obama people are worried that if you wait until election day, you might just change your mind. We have seen in the polls that there is movement towards McCain ever since Joe "The Plumber" hit the scene. Obama's "spread the wealth" comment to "Joe" and the release of an earlier taped interview with a Chicago radio station that appears to say the same thing, is taking a toll. If you discount those silly, double-digit polls by the left-wing mainstream media, like Time, Newsweek, the New York Times and Washington Post, and just focus on the real tracking polls by real polling organizations like Rasmussen, Zogby, GWU/battleground, IBD/Tipp, and Gallup, it appears that Obama's lead is about 3.4 percent with a 2.6 percent margin of error. I am also sure that the Obama Campaign is seeing the same or even worse in their own internal paid-polling.
Barack Obama has always had a problem, as many have said, in closing the deal. In his various primary election duels with Hillary Clinton, all too often, his leads fell apart or completely dissipated on voting day. In case after case, the polls were just plain wrong. Some by as much as 10 or 11 percent.
McCain looks to be losing on paper if you look at the state-by-state polls that can affect the results of the electoral college voting. But those infrequent state polls tend to lag behind what is actually happening in the more-current national polls. For that reason, the state polls might just be overstating an Obama win. The national polls, which can expose possible trends for the state polls, show that there are a lot of undecided voters right now. McCain has a chance to win if he could woo those people in these last few days or "IF" more game-changing information comes out about Barack Obama. There is one other factor, too. When some weakly committed voters are alone in that voting booth, they just might have second thoughts about voting for someone like Barack Obama, who carries so much unfavorable baggage, and who has made so many questionable promises.
With the way things look right now, I really think this election will be won on a razor's edge. It may actually spend days in our courts before being resolved because of all the ACORN crap. I may be wrong but, I don't see a blowout for Obama as his cheerleaders, like the mainstream media, would have you believe. Obama's own words about voting early are, I think, proof of that.
I really think the reason is because the Obama campaign is worried. He knows that once you vote you can't take it back. The Obama people are worried that if you wait until election day, you might just change your mind. We have seen in the polls that there is movement towards McCain ever since Joe "The Plumber" hit the scene. Obama's "spread the wealth" comment to "Joe" and the release of an earlier taped interview with a Chicago radio station that appears to say the same thing, is taking a toll. If you discount those silly, double-digit polls by the left-wing mainstream media, like Time, Newsweek, the New York Times and Washington Post, and just focus on the real tracking polls by real polling organizations like Rasmussen, Zogby, GWU/battleground, IBD/Tipp, and Gallup, it appears that Obama's lead is about 3.4 percent with a 2.6 percent margin of error. I am also sure that the Obama Campaign is seeing the same or even worse in their own internal paid-polling.
Barack Obama has always had a problem, as many have said, in closing the deal. In his various primary election duels with Hillary Clinton, all too often, his leads fell apart or completely dissipated on voting day. In case after case, the polls were just plain wrong. Some by as much as 10 or 11 percent.
McCain looks to be losing on paper if you look at the state-by-state polls that can affect the results of the electoral college voting. But those infrequent state polls tend to lag behind what is actually happening in the more-current national polls. For that reason, the state polls might just be overstating an Obama win. The national polls, which can expose possible trends for the state polls, show that there are a lot of undecided voters right now. McCain has a chance to win if he could woo those people in these last few days or "IF" more game-changing information comes out about Barack Obama. There is one other factor, too. When some weakly committed voters are alone in that voting booth, they just might have second thoughts about voting for someone like Barack Obama, who carries so much unfavorable baggage, and who has made so many questionable promises.
With the way things look right now, I really think this election will be won on a razor's edge. It may actually spend days in our courts before being resolved because of all the ACORN crap. I may be wrong but, I don't see a blowout for Obama as his cheerleaders, like the mainstream media, would have you believe. Obama's own words about voting early are, I think, proof of that.
Wednesday, October 29, 2008
Obama and the Venezuela Example
Right now, for God only knows how many times in this world's history, there is another experiment in socialism taking place in our western hemisphere in the South American country of Venezuela. This Cubanesque conversion of that country from capitalism to socialism and, probably, from democracy to a dictatorial form of communism is being spearheaded by Venezuela's President, Hugo Chavez. What concerns me is that much of Chavez' philosophies are being faintly echoed by Barack Obama and other far-left Democrats (Click to see a related commentary from 2005). I think this is especially true when you take this quote from Hugo Chavez, "...the way to build a new and better world is not capitalism. Capitalism leads us straight to hell.” and then you hear words from Mr. Obama about changing the world (See Full Story).
Take, for example, Barack Obama's current stand on taxes. Then, read this CNN News article from April 1999, "Venezuela's Chavez assumes new powers, readies new taxes", and I think you will hear an echo in Barack's pledges of today. Chavez's reference of "leashing the devil" is in regard to the social and economic injustices of capitalism. Barack Obama's multiple comments on "spreading the wealth" sure sound a lot like Chavez's 2005 move to take land away from the wealthy and give it to those who are the lowest on the economic scale (See Full Story). One could argue that Chavez's seizure of lands is much different than just raising taxes on the rich so that money can be redistributed to the poorer in our economy. But, is it really?
When Maxine Waters talked about "socializing (err)...taking over" the oil companies in this video (Click to view) it was obvious that capitalism wasn't on her mind. Maxine is clearly taking a page out of Hugo Chavez's socialist/communist playbook when you read this story from 2007: "Chavez nationalizes oil companies" (click to view news article) .
And, doesn't this sound familiar: "Venezuela nets 4.3 billion US dollars in windfall oil profit tax" (Click to view complete article).
One thing that a leftist form of government can't stand is an opposing viewpoint. In this country, the Democrats are proposing the so-called "Fairness Doctrine" (See Wikipedia Article) to silence the right. In many ways, this is similar to some moves made by Hugo Chavez as seen in this news article: "Chavez to shut down opposition TV" (click to view). Certainly, neither move is intended to have a society with free and uncensored speech.
Chavez has gained more and more control because his left-wing political party has dominant control. Enough control to dramatically change the powers of that country (See Full Story). That control could be very similar to what might occur in this country in 2009 (See Full Story). Besides giving Chavez the power to lead that country for life, that news article points out: "Other reforms would create new types of property to be managed by cooperatives, give neighborhood-based "communal councils" administrative responsibilities usually reserved for elected officials..." Do I see a new future in this country for community organizing groups like ACORN?
The sad thing about socialism is that, in the long run, it doesn't work. In the 1950's to 1970's, some European governments tried to nationalize things like banks, railroads, and airlines. It didn't work, and those things, today, have been returned to the public sector. Russia and China have since succumbed to the ways of capitalism because the furthest left of socialist society, communism, didn't work either. Those countries who stayed with it, like North Korea and Cuba, have done nothing but drag their countries into the depths of economic nonexistence. Thousand are starving in North Korea as that country pursues it's military aspirations. Cuba is isolated and people scrape together spare parts so they can drive around in U.S. made cars from the 1950's and 1960's.
Venezuela is on track for a similar fate. Inflation in that country is just making the poor poorer (See Full Story). Milk and eggs and other essential foods are missing from grocery shelves (See story and listen to the audio). In a country that is awash with energy in the form of oil, there is a shortage of electricity, as seen in this news article: "Oil powerhouse Venezuela struggles to keep lights on" (click for article).
Chavez took over because of his populist message that appealed to the poor and the lower middle classes. This is, in essence, the Obama message; although, he has conveniently tailored that message of today to make it seem like the middle class will get the greatest benefit. But, it isn't the middle class that actually benefits from Obama's plans for this country. His plan is to redistribute income and wealth to the lowest income levels who don't even pay taxes; and, that is an attempt to turn America into a socialist, welfare state. Venezuela is an example of what Obama wants and what this country could ultimately be. As you can see, it ain't a pretty picture. The belief that you can take wealth away from a country's wealth builders is a failed belief that has been tested and proven wrong in one socialist attempt after another. Socialism only breeds inflation and shortages of goods and services with the poor getting hurt the most. Hopefully, this country won't be as complacent as Venezuela was in letting things get as far out of hand as they have today. Just hopefully!
Take, for example, Barack Obama's current stand on taxes. Then, read this CNN News article from April 1999, "Venezuela's Chavez assumes new powers, readies new taxes", and I think you will hear an echo in Barack's pledges of today. Chavez's reference of "leashing the devil" is in regard to the social and economic injustices of capitalism. Barack Obama's multiple comments on "spreading the wealth" sure sound a lot like Chavez's 2005 move to take land away from the wealthy and give it to those who are the lowest on the economic scale (See Full Story). One could argue that Chavez's seizure of lands is much different than just raising taxes on the rich so that money can be redistributed to the poorer in our economy. But, is it really?
When Maxine Waters talked about "socializing (err)...taking over" the oil companies in this video (Click to view) it was obvious that capitalism wasn't on her mind. Maxine is clearly taking a page out of Hugo Chavez's socialist/communist playbook when you read this story from 2007: "Chavez nationalizes oil companies" (click to view news article) .
And, doesn't this sound familiar: "Venezuela nets 4.3 billion US dollars in windfall oil profit tax" (Click to view complete article).
One thing that a leftist form of government can't stand is an opposing viewpoint. In this country, the Democrats are proposing the so-called "Fairness Doctrine" (See Wikipedia Article) to silence the right. In many ways, this is similar to some moves made by Hugo Chavez as seen in this news article: "Chavez to shut down opposition TV" (click to view). Certainly, neither move is intended to have a society with free and uncensored speech.
Chavez has gained more and more control because his left-wing political party has dominant control. Enough control to dramatically change the powers of that country (See Full Story). That control could be very similar to what might occur in this country in 2009 (See Full Story). Besides giving Chavez the power to lead that country for life, that news article points out: "Other reforms would create new types of property to be managed by cooperatives, give neighborhood-based "communal councils" administrative responsibilities usually reserved for elected officials..." Do I see a new future in this country for community organizing groups like ACORN?
The sad thing about socialism is that, in the long run, it doesn't work. In the 1950's to 1970's, some European governments tried to nationalize things like banks, railroads, and airlines. It didn't work, and those things, today, have been returned to the public sector. Russia and China have since succumbed to the ways of capitalism because the furthest left of socialist society, communism, didn't work either. Those countries who stayed with it, like North Korea and Cuba, have done nothing but drag their countries into the depths of economic nonexistence. Thousand are starving in North Korea as that country pursues it's military aspirations. Cuba is isolated and people scrape together spare parts so they can drive around in U.S. made cars from the 1950's and 1960's.
Venezuela is on track for a similar fate. Inflation in that country is just making the poor poorer (See Full Story). Milk and eggs and other essential foods are missing from grocery shelves (See story and listen to the audio). In a country that is awash with energy in the form of oil, there is a shortage of electricity, as seen in this news article: "Oil powerhouse Venezuela struggles to keep lights on" (click for article).
Chavez took over because of his populist message that appealed to the poor and the lower middle classes. This is, in essence, the Obama message; although, he has conveniently tailored that message of today to make it seem like the middle class will get the greatest benefit. But, it isn't the middle class that actually benefits from Obama's plans for this country. His plan is to redistribute income and wealth to the lowest income levels who don't even pay taxes; and, that is an attempt to turn America into a socialist, welfare state. Venezuela is an example of what Obama wants and what this country could ultimately be. As you can see, it ain't a pretty picture. The belief that you can take wealth away from a country's wealth builders is a failed belief that has been tested and proven wrong in one socialist attempt after another. Socialism only breeds inflation and shortages of goods and services with the poor getting hurt the most. Hopefully, this country won't be as complacent as Venezuela was in letting things get as far out of hand as they have today. Just hopefully!
Tuesday, October 28, 2008
The Midas Malarkey
I am sure that you've all seen those "buy gold" commercials on TV that hype the "yellow stuff" as a means to protect your savings and investments. I especially like the one with G. Gordon Liddy where he snaps a dollar in his hands and declares that it has lost 27% since the year 2000. Of course, Mr. Liddy neglects to tell you about the roller coaster ride that gold has taken over the last 30 years which has left many holding the bag with losses. While it is true that gold has shot up from around $255 a troy ounce in the year 2000, to a high of $1,033 in March of this year, it has fallen by 30% to today's price of around $730 in just 7 short months (See Full Story). At the same time that gold has been going down, the U.S. dollar has been strengthening against other currencies by a factor of almost 20 percent (See Full Story); thus making Mr. Liddy's argument about the dollar losing so much value to be very much a distortion.
In 1980, gold hit it's previous all-time high of about $855 a troy ounce. From that high, gold fell to a low of $253 an ounce in 1999 and bounced around from that price to a little over $300 an ounce until 2001. If you had bought the precious metal in 1980, you would have had to wait until January of this year, or 28 years, before gold was, once again, even close to being profitable for you.
The truth about gold is that it is a commodity like wheat or oil. TV ads, like those which use Mr. Liddy as the spokesperson, are designed to pump gold prices up by stimulating an artificial buying interest. Gold, as it did in 1980, reached a bubble this year that could not be sustained and, subsequently, has fallen nearly 30 percent. My guess is that $500 a troy ounce is not out of the question within the next two years. Maybe, even lower.
Nothing can ever go straight up and the price of gold is no different. Gold coins are actually the better bet because, depending on the specific coin, you can benefit from both the market value of the inherent gold and the value due to a collector's interest in the coin itself. However, like buying art, you can't cluelessly buy gold coins and expect to automatically make money. You have to know what you're doing.
It is naive to believe you can just buy some gold and automatically make profits by investing in this noble metal. Also, with gold's current price drop in the face of so much economic angst, there is absolutely no guarantee that it will provide protection of your savings during times of trouble. It is not some kind of "bridge over troubled waters" as those commercials would have you believe. Some of those same gold commercials that you see on TV, today, have been running nearly unchanged for two decades because the premise for buying gold, a looming world and economic disaster, has been nearly a constant in every generation and for every decade over the last 100 years. From the crash of 1929; to World War II; to Korea and the Cold War; to the fears over the new millennium (Y2K); or, to today's possible depression; there has always been enough "fear" for the chicken-little-TV-commercials to get you to buy gold. The reality is that those people buying that commercial time, own gold and want you to buy for their own selfish reasons.
Additionally, people don't really understand that there are a lot of expenses associated with gold. If you buy gold, you need to store it somewhere and insure it. Dealers will do that for you but, at an additional cost. If you want to take possession of it and store it yourself, the stuff is heavy and costs a lot to move around and, again, insure it and safely store it.
You don't have to actually buy and own gold to play gold. You can buy and sell a market-traded ETF (Exchange Trade Fund) which has the market symbol of "GLD" on the New York Stock Exchange. Those shares are intentionally selling at roughly 10 percent of the value of an ounce of gold. For example, if gold is at $800 an ounce, the GLD ETF shares will be selling around $80. Like any investment, there is no guarantee of success or failure in buying these shares; especially in this market. You should definitely consult an investment adviser in making any investment decisions. Buying gold or it's ETF's is no different than buying any stock and you could lose much of your investment if the timing is wrong.
So, to me, the buy gold info-mercials are just a bunch of malarkey. As with any other investment, gold has risk. The fine print on those commercials, which is so fine and shown so briefly, clearly states that there is risk. Believe me, there is no Midas touch in buying gold; especially right now.
In 1980, gold hit it's previous all-time high of about $855 a troy ounce. From that high, gold fell to a low of $253 an ounce in 1999 and bounced around from that price to a little over $300 an ounce until 2001. If you had bought the precious metal in 1980, you would have had to wait until January of this year, or 28 years, before gold was, once again, even close to being profitable for you.
The truth about gold is that it is a commodity like wheat or oil. TV ads, like those which use Mr. Liddy as the spokesperson, are designed to pump gold prices up by stimulating an artificial buying interest. Gold, as it did in 1980, reached a bubble this year that could not be sustained and, subsequently, has fallen nearly 30 percent. My guess is that $500 a troy ounce is not out of the question within the next two years. Maybe, even lower.
Nothing can ever go straight up and the price of gold is no different. Gold coins are actually the better bet because, depending on the specific coin, you can benefit from both the market value of the inherent gold and the value due to a collector's interest in the coin itself. However, like buying art, you can't cluelessly buy gold coins and expect to automatically make money. You have to know what you're doing.
It is naive to believe you can just buy some gold and automatically make profits by investing in this noble metal. Also, with gold's current price drop in the face of so much economic angst, there is absolutely no guarantee that it will provide protection of your savings during times of trouble. It is not some kind of "bridge over troubled waters" as those commercials would have you believe. Some of those same gold commercials that you see on TV, today, have been running nearly unchanged for two decades because the premise for buying gold, a looming world and economic disaster, has been nearly a constant in every generation and for every decade over the last 100 years. From the crash of 1929; to World War II; to Korea and the Cold War; to the fears over the new millennium (Y2K); or, to today's possible depression; there has always been enough "fear" for the chicken-little-TV-commercials to get you to buy gold. The reality is that those people buying that commercial time, own gold and want you to buy for their own selfish reasons.
Additionally, people don't really understand that there are a lot of expenses associated with gold. If you buy gold, you need to store it somewhere and insure it. Dealers will do that for you but, at an additional cost. If you want to take possession of it and store it yourself, the stuff is heavy and costs a lot to move around and, again, insure it and safely store it.
You don't have to actually buy and own gold to play gold. You can buy and sell a market-traded ETF (Exchange Trade Fund) which has the market symbol of "GLD" on the New York Stock Exchange. Those shares are intentionally selling at roughly 10 percent of the value of an ounce of gold. For example, if gold is at $800 an ounce, the GLD ETF shares will be selling around $80. Like any investment, there is no guarantee of success or failure in buying these shares; especially in this market. You should definitely consult an investment adviser in making any investment decisions. Buying gold or it's ETF's is no different than buying any stock and you could lose much of your investment if the timing is wrong.
So, to me, the buy gold info-mercials are just a bunch of malarkey. As with any other investment, gold has risk. The fine print on those commercials, which is so fine and shown so briefly, clearly states that there is risk. Believe me, there is no Midas touch in buying gold; especially right now.
Monday, October 27, 2008
When Our Government Has No Boundaries
We may be at a stage in our government when as much as half the population in this country will have no voice. That's because, in January, the reins of government might be completely in the control of the Democrats. When I say completely, I mean it. There is a distinct possibility that we will not only have a Democratic President and Democratically controlled Congress, but, also, the upper chamber of our Congress, the United States Senate, may have enough control to be both veto-proof and, more importantly, filibuster-proof. Not since 1977 and the Carter Administration has this country been in a similar situation and one could hardly point to those years following that fact as being the bright spot in this country's history.
What does this mean to America? Basically, it means that the loyal opposition, the Republicans, have no means at their disposal to stop the steamrolling of liberal policies through our government. The best that they could hope for is that a few centrist Democrats (like the Blue Dogs) that will help protect this country by standing with the Republicans in what could be the greatest and farthest left-wing agenda that this country has every seen.
Our Constitution is unique in that it was intentionally designed to, normally, protect us from dominant control. The entire constitution was designed with "representation" in mind and with a concern over checks and balances by having separate and distinct branches of government. If you recall, the rallying cry for the independence movement from England was "taxation without representation". So, the concept of representation was paramount in the creation of our unique form of government.
However, at the time our Constitution was drafted, the concept of two strong political parties was not considered a possibility. At that time, the closest thing to a political party were the Whigs (also called the Patriot Whigs) that were, in essence, our American Revolutionaries. These Whigs were in contrast with the loyalists who had no objection to British rule.
When our government and Constitution was establish, I am sure that no one would have thought that there would be such a thing as a "solid voting" block of ideology that we now call a political party. I am sure that our founders believed that any Congressman or Senator would only vote to best serve their specific constituencies (their districts and their states) and would not be serving the broader wishes of some political movement like a political party.
My guess is that this future Democratically controlled government of Obama/Pelosi/Reid will overstep their powers and their complete control will be as short-lived as was the Congress of 1977. If so, expect that the election of 2010 will undo much of what may be about to be done in this year's election. In essence, expect our country to "Vote the bums out" by electing some Republicans to minimize the control by the Democrats. Also, if history does repeat itself, Barack Obama is probably doomed to just one term; just as Jimmy Carter was.
Unfortunately, there could be a lot of damage done to this country if we have one political party in control and that party has no boundaries. Laws could be enacted like the Fairness Doctrine and the Union Card Check System that could have a massive effect on the long term direction of true democracy in this country. Tax credits can be given that can never be taken away. Tax increases could be enacted that could have disastrous effects on our currently fragile economy. Our military could be weakened to the extent that we are at risk when Russia and China are strengthening their own military complexes. The effect on our Judicial System with the appointment of Federal Judges and Supreme Court Judges may further erode the purpose of our Judiciary as being a separate check against the Legislative and Executive branches of our government. If too many "activist" judges (which are appointments for life) infiltrate the Judiciary, we could have a continuance of Democratic rule because progressive-minded and liberal-minded Judges would literally legislate from the "benches" of our court system.
The extent of liberal/progressive/socialistic programs that can be imposed on this country can almost be limitless. Don't expect a President Barack Obama to make the tough decisions to veto any of that. My opinion is that he will just continue to do what he has done in the past. He will sign his party's legislation and, like all those times he voted "present" in the Illinois Senate, he will never want to rock the boat on tough issues that might not be right for this country. There will be absolutely no working across the aisle with the Republicans because he won't need to. Just mark my words.
What does this mean to America? Basically, it means that the loyal opposition, the Republicans, have no means at their disposal to stop the steamrolling of liberal policies through our government. The best that they could hope for is that a few centrist Democrats (like the Blue Dogs) that will help protect this country by standing with the Republicans in what could be the greatest and farthest left-wing agenda that this country has every seen.
Our Constitution is unique in that it was intentionally designed to, normally, protect us from dominant control. The entire constitution was designed with "representation" in mind and with a concern over checks and balances by having separate and distinct branches of government. If you recall, the rallying cry for the independence movement from England was "taxation without representation". So, the concept of representation was paramount in the creation of our unique form of government.
However, at the time our Constitution was drafted, the concept of two strong political parties was not considered a possibility. At that time, the closest thing to a political party were the Whigs (also called the Patriot Whigs) that were, in essence, our American Revolutionaries. These Whigs were in contrast with the loyalists who had no objection to British rule.
When our government and Constitution was establish, I am sure that no one would have thought that there would be such a thing as a "solid voting" block of ideology that we now call a political party. I am sure that our founders believed that any Congressman or Senator would only vote to best serve their specific constituencies (their districts and their states) and would not be serving the broader wishes of some political movement like a political party.
My guess is that this future Democratically controlled government of Obama/Pelosi/Reid will overstep their powers and their complete control will be as short-lived as was the Congress of 1977. If so, expect that the election of 2010 will undo much of what may be about to be done in this year's election. In essence, expect our country to "Vote the bums out" by electing some Republicans to minimize the control by the Democrats. Also, if history does repeat itself, Barack Obama is probably doomed to just one term; just as Jimmy Carter was.
Unfortunately, there could be a lot of damage done to this country if we have one political party in control and that party has no boundaries. Laws could be enacted like the Fairness Doctrine and the Union Card Check System that could have a massive effect on the long term direction of true democracy in this country. Tax credits can be given that can never be taken away. Tax increases could be enacted that could have disastrous effects on our currently fragile economy. Our military could be weakened to the extent that we are at risk when Russia and China are strengthening their own military complexes. The effect on our Judicial System with the appointment of Federal Judges and Supreme Court Judges may further erode the purpose of our Judiciary as being a separate check against the Legislative and Executive branches of our government. If too many "activist" judges (which are appointments for life) infiltrate the Judiciary, we could have a continuance of Democratic rule because progressive-minded and liberal-minded Judges would literally legislate from the "benches" of our court system.
The extent of liberal/progressive/socialistic programs that can be imposed on this country can almost be limitless. Don't expect a President Barack Obama to make the tough decisions to veto any of that. My opinion is that he will just continue to do what he has done in the past. He will sign his party's legislation and, like all those times he voted "present" in the Illinois Senate, he will never want to rock the boat on tough issues that might not be right for this country. There will be absolutely no working across the aisle with the Republicans because he won't need to. Just mark my words.
Sunday, October 26, 2008
Let Your Conscience Be Your Guide
There actually was a time when Hollywood was interested in bringing societal messages of good and kindness to their audience through their primary mediums of television programming and motion pictures. It wasn't like today, where drugs, killing, crime, profanity, and social deviation are almost always being presented as the norms for society.
Silly as some progressives of our society might think, there was a near-philosophical statement in a Disney movie, Pinocchio, that to me, actually speaks to the existence of God. Even sillier to some, it was presented by a cartoon character, Jiminy Cricket. That philosophical statement was simply: "Let Your Conscience Be Your Guide."
If you really think about it ,we are all born with a conscience to keep us on the straight and narrow. It tells us when we are doing something wrong. Even if that something that we are doing is clearly out of the sight of others, that "voice" tells us that it is wrong. At the same time, we know when we are doing something extremely good for others because, often, in doing so, we experience an extremely profound feeling of joy that is, many times, accompanied with tears of happiness. These aren't trained responses. They are innate...and maybe...just maybe, they have been given to all of us by a higher power.
I have always thought of conscience as a possible proof of God. Others could certainly disagree. I also know that over time, we can "deprogram" our conscience. We can become hardened so that we ignore what it is saying. Those we know, such as family members and friends, can do that if they have already gone through the process of deprogramming. Society can do the same. The sad thing is that conscience can spiral out of existence if generation after generation of humans keeps putting it aside, and sadly, I don't know if society can ever reclaim it once it has been totally lost.
Silly as some progressives of our society might think, there was a near-philosophical statement in a Disney movie, Pinocchio, that to me, actually speaks to the existence of God. Even sillier to some, it was presented by a cartoon character, Jiminy Cricket. That philosophical statement was simply: "Let Your Conscience Be Your Guide."
If you really think about it ,we are all born with a conscience to keep us on the straight and narrow. It tells us when we are doing something wrong. Even if that something that we are doing is clearly out of the sight of others, that "voice" tells us that it is wrong. At the same time, we know when we are doing something extremely good for others because, often, in doing so, we experience an extremely profound feeling of joy that is, many times, accompanied with tears of happiness. These aren't trained responses. They are innate...and maybe...just maybe, they have been given to all of us by a higher power.
I have always thought of conscience as a possible proof of God. Others could certainly disagree. I also know that over time, we can "deprogram" our conscience. We can become hardened so that we ignore what it is saying. Those we know, such as family members and friends, can do that if they have already gone through the process of deprogramming. Society can do the same. The sad thing is that conscience can spiral out of existence if generation after generation of humans keeps putting it aside, and sadly, I don't know if society can ever reclaim it once it has been totally lost.
Saturday, October 25, 2008
From The Wisdom of Mike Huckabee
I was watching Fox News this morning and the former Governor of Arkansas, Mike Huckabee, made an excellent point.
Obama's comment of "spread the wealth around" might sound OK to some lower and middle class working Americans who see 'wealth' and 'rich' as being somewhat the same things. Mike Huckabee pointed out the fact that Barack Obama isn't really talking about spreading "wealth" around. Instead, he is actually talking about spreading hard-earned "income" around to those at the lower ends of the pay scale. And that, for sure, is socialism. That subtle distinction between "wealth" and "income" speaks more clearly to Obama's tax plan.
There is an attitude, by many Democrats, that someone who makes "a lot of money," got that way by either an accident of birth, or by simply getting that money off the backs of poorer workers. Working hard towards an education and working hard in their job and using that hard work and their ideas to create other jobs, never seems to enter into the minds of those politicians. Those same politicians also have much difficulty deciding what constitutes "a lot of money." If you are worried about someone who makes minimum wage of around $10,000, a $40,000 a year salary can be seen as a lot of money. However, in some cities, like San Francisco, $40,000 could be considered a minimum living wage.
I have always said that if you gave $50,000 each to 4 average, working Americans to create a new business within two year's time and, then, gave the same amount of money to a former CEO to do the same, the odds would be greater that the CEO will be the only one out of that group to actually create a viable business and a business that would employ more workers than just himself. That's because the failure rate of all new businesses in this country is about 80 percent. Not included in that statistic is the number of businesses that fail to even get started. The CEO has the better chance of success because of his experience in understanding business and in operating one.
Sure, the are a lot of plumbers and painters and other tradesmen that have gone on to create their own businesses. If you talk to them, you will generally find out that their first years were generally touch and go. Often, not always, several years of working alone to build the business had to pass by before the customer base was large enough to employ another worker.
On the flip side of that, take somebody like Ross Perot. He became a billionaire because he was able to see a specific need in the marketplace of mainframe computing. He was a hard working, top salesman for IBM for five years from 1957 to 1962. He left IBM in 1962 and started a company called Electronic Data Systems or EDS. After many struggles in getting the business started, EDS finally became a publicly traded corporation in 1968. In 1984, he sold EDS to General Motors for 2.4 billion dollars. Now owned by Hewlitt-Packard, EDS has grown to 137,000 employees in 65 countries with revenues in excess of $22 billion dollars. Then, the restless Perot footed the bill for Steve Jobs (of Apple Computer fame) to start a company called NeXT in 1986. That created another 552 jobs until that company was bought up by Apple Computer in 1996 for $429 million dollars. Still restless, Perot created another company in 1988 called Perot Systems. Still in operation today, Perot Systems is generating $2.77 billion in sales and has 23,100 employees. One man, Ross Perot, has made taxable billions in profits for our country. His companies have resulted in jobs for more than 160,000 workers who are mostly college educated and who get paid very well. These are hardly minimum wage jobs!
I get a little tired of the erroneous philosophy that economies are built from the ground up or from the worker level, and that our tax system should reflect that. There are many, many Ross Perot's in this country who have done much to create both jobs and taxable wages and taxable company profits who have, literally, kept this country going. Now, Barack Obama and the Democrats, through the imposition of heavier taxation, want to hamper the ability for these kinds of businessmen, like Ross Perot, to create new taxpaying businesses and create a lot of new and taxpaying jobs.
There is this childish belief that, somehow, people who have made money just let it sit around and spend their time counting it. Some politicians seem to think this money would be better used if scooped up by our government and spread around. But, that's hardly close to the truth. That is not understanding how capitalism works. Unless that money is sitting in a cookie jar or lying under someone's mattress, at the very least, it is being put to work by depositing it into a bank account. Then, that bank will generate income and taxes of it's own by using that money to give out loans so that you and I can buy a car or a house or start a business. If the house that is being purchased is a new house, American laborers are definitely put to work. A real estate agent might get involved in selling the old house and they will pay taxes on that income. That may or may not be completely the case when a car loan is given out because the car, itself, might be imported. But all those who handle the transaction on this side of the shore will benefit from work and will, subsequently, pay taxes. When a loan is given for a new business, that new venture can generate tax revenues and, if really successful, create new jobs.
Giving people a $1000 check isn't necessarily a bad thing. But, don't ever try to say it would be as good or better economically as keeping taxes low. This is a pure fantasy that those "bottom uppers" would have you believe. More often than not, much of that $1,000 will go to some product that is being imported. There is also a tendency to "buy better" and, not necessarily buy more stuff. Buying better doesn't create new jobs because there is no increase in the quantity of things being bought. Finally, there is a false belief that all those receiving a government check will use it wisely. That, too, is a complete fallacy. There is story after story of people winning the lottery who are now, once again, flat broke.
Generally speaking, people who work hard to amass some amount of savings or some amount of wealth can better appreciate the value of that money rather than someone to whom it has merely been given.
Obama's comment of "spread the wealth around" might sound OK to some lower and middle class working Americans who see 'wealth' and 'rich' as being somewhat the same things. Mike Huckabee pointed out the fact that Barack Obama isn't really talking about spreading "wealth" around. Instead, he is actually talking about spreading hard-earned "income" around to those at the lower ends of the pay scale. And that, for sure, is socialism. That subtle distinction between "wealth" and "income" speaks more clearly to Obama's tax plan.
There is an attitude, by many Democrats, that someone who makes "a lot of money," got that way by either an accident of birth, or by simply getting that money off the backs of poorer workers. Working hard towards an education and working hard in their job and using that hard work and their ideas to create other jobs, never seems to enter into the minds of those politicians. Those same politicians also have much difficulty deciding what constitutes "a lot of money." If you are worried about someone who makes minimum wage of around $10,000, a $40,000 a year salary can be seen as a lot of money. However, in some cities, like San Francisco, $40,000 could be considered a minimum living wage.
I have always said that if you gave $50,000 each to 4 average, working Americans to create a new business within two year's time and, then, gave the same amount of money to a former CEO to do the same, the odds would be greater that the CEO will be the only one out of that group to actually create a viable business and a business that would employ more workers than just himself. That's because the failure rate of all new businesses in this country is about 80 percent. Not included in that statistic is the number of businesses that fail to even get started. The CEO has the better chance of success because of his experience in understanding business and in operating one.
Sure, the are a lot of plumbers and painters and other tradesmen that have gone on to create their own businesses. If you talk to them, you will generally find out that their first years were generally touch and go. Often, not always, several years of working alone to build the business had to pass by before the customer base was large enough to employ another worker.
On the flip side of that, take somebody like Ross Perot. He became a billionaire because he was able to see a specific need in the marketplace of mainframe computing. He was a hard working, top salesman for IBM for five years from 1957 to 1962. He left IBM in 1962 and started a company called Electronic Data Systems or EDS. After many struggles in getting the business started, EDS finally became a publicly traded corporation in 1968. In 1984, he sold EDS to General Motors for 2.4 billion dollars. Now owned by Hewlitt-Packard, EDS has grown to 137,000 employees in 65 countries with revenues in excess of $22 billion dollars. Then, the restless Perot footed the bill for Steve Jobs (of Apple Computer fame) to start a company called NeXT in 1986. That created another 552 jobs until that company was bought up by Apple Computer in 1996 for $429 million dollars. Still restless, Perot created another company in 1988 called Perot Systems. Still in operation today, Perot Systems is generating $2.77 billion in sales and has 23,100 employees. One man, Ross Perot, has made taxable billions in profits for our country. His companies have resulted in jobs for more than 160,000 workers who are mostly college educated and who get paid very well. These are hardly minimum wage jobs!
I get a little tired of the erroneous philosophy that economies are built from the ground up or from the worker level, and that our tax system should reflect that. There are many, many Ross Perot's in this country who have done much to create both jobs and taxable wages and taxable company profits who have, literally, kept this country going. Now, Barack Obama and the Democrats, through the imposition of heavier taxation, want to hamper the ability for these kinds of businessmen, like Ross Perot, to create new taxpaying businesses and create a lot of new and taxpaying jobs.
There is this childish belief that, somehow, people who have made money just let it sit around and spend their time counting it. Some politicians seem to think this money would be better used if scooped up by our government and spread around. But, that's hardly close to the truth. That is not understanding how capitalism works. Unless that money is sitting in a cookie jar or lying under someone's mattress, at the very least, it is being put to work by depositing it into a bank account. Then, that bank will generate income and taxes of it's own by using that money to give out loans so that you and I can buy a car or a house or start a business. If the house that is being purchased is a new house, American laborers are definitely put to work. A real estate agent might get involved in selling the old house and they will pay taxes on that income. That may or may not be completely the case when a car loan is given out because the car, itself, might be imported. But all those who handle the transaction on this side of the shore will benefit from work and will, subsequently, pay taxes. When a loan is given for a new business, that new venture can generate tax revenues and, if really successful, create new jobs.
Giving people a $1000 check isn't necessarily a bad thing. But, don't ever try to say it would be as good or better economically as keeping taxes low. This is a pure fantasy that those "bottom uppers" would have you believe. More often than not, much of that $1,000 will go to some product that is being imported. There is also a tendency to "buy better" and, not necessarily buy more stuff. Buying better doesn't create new jobs because there is no increase in the quantity of things being bought. Finally, there is a false belief that all those receiving a government check will use it wisely. That, too, is a complete fallacy. There is story after story of people winning the lottery who are now, once again, flat broke.
Generally speaking, people who work hard to amass some amount of savings or some amount of wealth can better appreciate the value of that money rather than someone to whom it has merely been given.
Friday, October 24, 2008
Will OPEC Cheat On Each Other?
This morning, oil fell below $64 a barrel. This was a drop of around $4. In September, before the true extent of all this credit mess was known, I thought we could get down to $60 a barrel when some, like T. Boone Pickens, were predicting a mere fall to $80. I knew, based on my years of experience in investing, that the $80 a barrel level would be overshot; but, not quite this fast (See my Septemeber 2nd blog entry: "Is $80 or $60 A Barrel Oil in Our Future?").
I now think that a price below $50/barrel is achievable and, contrary to my previous blog entry, I think oil prices may be held below $80 a barrel throughout 2009.
Also seeing that potential, OPEC is now in panic mode. At their emergency meeting this morning, they immediately cut oil by 1.5 million barrels a day to stabilize prices (See Full Story). The downdraft in oil is killing government revenues of state-run oil operations in countries like Saudi Arabia, Venezuela, Iran, and Russia. Take, for example, Venezuela. If you assume that Venezuela is exporting about 2.4 million barrels of oil per day, the difference in revenues when oil was at a high of $147 and the current price of $63 is one big hurt. It puts a serious dent in Chavez' plans to buy more military toys like planes, helicopters, tanks and guns.
When oil was going up, the OPEC cartel was fairly disciplined. They could see the benefits of holding the production levels to force prices up. In this down draft, however, the honor among these thieves might not be as true. OPEC has always had a history of cheating on production levels so they could sneak extra profits in for their country's coffers. My guess is that the falling oil prices will restore OPEC members to their "cheating ways". That's why I think $45 a barrel (maybe, even lower) may be achievable.
One last comment. These oil prices will, again, kick the chair out from underneath any plans for offshore drilling. Once again, it will be oil prices coming down that will set us up for another energy crisis in the future; once the world economies starts to stabilize. Once again, we will have lost another couple of years or more in drilling ourselves out of our dependence on foreign oil. That's because, sadly, our politicians will have responded to these temporary low prices as they have always done in the past, by not doing anything. Believe me, wind and solar plans by the Obama and the Democrats, won't even make a dent in those 200 million cars that we have on our city streets.
I now think that a price below $50/barrel is achievable and, contrary to my previous blog entry, I think oil prices may be held below $80 a barrel throughout 2009.
Also seeing that potential, OPEC is now in panic mode. At their emergency meeting this morning, they immediately cut oil by 1.5 million barrels a day to stabilize prices (See Full Story). The downdraft in oil is killing government revenues of state-run oil operations in countries like Saudi Arabia, Venezuela, Iran, and Russia. Take, for example, Venezuela. If you assume that Venezuela is exporting about 2.4 million barrels of oil per day, the difference in revenues when oil was at a high of $147 and the current price of $63 is one big hurt. It puts a serious dent in Chavez' plans to buy more military toys like planes, helicopters, tanks and guns.
When oil was going up, the OPEC cartel was fairly disciplined. They could see the benefits of holding the production levels to force prices up. In this down draft, however, the honor among these thieves might not be as true. OPEC has always had a history of cheating on production levels so they could sneak extra profits in for their country's coffers. My guess is that the falling oil prices will restore OPEC members to their "cheating ways". That's why I think $45 a barrel (maybe, even lower) may be achievable.
One last comment. These oil prices will, again, kick the chair out from underneath any plans for offshore drilling. Once again, it will be oil prices coming down that will set us up for another energy crisis in the future; once the world economies starts to stabilize. Once again, we will have lost another couple of years or more in drilling ourselves out of our dependence on foreign oil. That's because, sadly, our politicians will have responded to these temporary low prices as they have always done in the past, by not doing anything. Believe me, wind and solar plans by the Obama and the Democrats, won't even make a dent in those 200 million cars that we have on our city streets.
Thursday, October 23, 2008
What The Stock Market Is Saying About An Obama Presidency
Before I begin, I should mention that, two days ago, I thought the stock market may be seeing a bottom. Then, yesterday, there was a 500 point drop. Yesterday's downdraft is suspected to have been driven by a couple of large hedge funds that were being forced to unwind (liquidate) their positions. This is contrary to the "business news" reporters who seem to think that yesterday's sell-off was because of recession fears. I hate to tell those less-than-in-depth reporters, the stock market has pretty much sold off over the last year and a recession is already built into this market with prices down between 40 and 60 percent. In a market that is so weak from collapse and without any real strength of buying, these hedge fund "unwindings" are going to have a serious impact on the overall stock market as selling greatly exceeds any strength of buying. I still think we might be at a bottom; but, caution is definitely warranted.
Now, to the point of this commentary.
Every evening, I quickly scan through the stocks and Exchange Traded Funds (ETFs) that may have had gains for that day. What I have been noticing over the last 10 day is that Municipal Bond ETFs are seeing quite a lot of gains. For example, the Alliance Bernstein National Municipal Income Fund, Symbol AFB, has risen 50% in the last 10 days of trading. The Van Kampen Municipal Trust, symbol VKQ, had a 38% increase. The BFK or Blackrock Muni Trust saw 41% in gains. 30% was seen in the MFL or Blackrock Municipal Holdings Insured Investment Holdings Trust. The list is actually quite long.
Municipal bonds are offered by local and state governments to secure a loan in the form of a bond in order to cover the high cost of some building project. This can be for the expansion of a state university or for new or repaired city roads, etc. The main reason that they are attractive to the investment community is that they are Federally tax free; and, that is an important point in today's context.
This sudden activity in all these Muni-bond funds clearly indicates a movement from Federally taxed investments to tax-free investments. People are apparently trying to get in on the bottom floor of what could be a tsunami of movement into these kinds of investment instruments. What this activity is really saying, in my opinion, is that some investors are moving their money away from what could be high capital gains taxes under a Democratic/Obama controlled government. This is clear evidence that smart money is saying Obama is going to win and that taxable capital assets are not the place to be. This is also surprising because, in a weak economy, state and local tax revenues are sure to go down. As a result, the risk associated with any municipal bonds and the potential defaults on those bonds will go up as bond rating agencies, most assuredly, downgrade these types of investments.
Clearly, there is fear about a recession which has caused the stock market to decline. However, this Muni bond action proves that there is actually a political component that is responsible for the stock market's going down. There is no real business person or investor in this world that would believe that Mr. Obama's tax plans won't be extremely detrimental to businesses in this country and to the global economy. Investors are yanking their money out of the stock markets, around the world, in order to keep their powder dry until they can navigate through the future of investing. That future definitely includes the plans that Obama and the Democrats have in store for business in this country. I also think that the investment community is concerned that we will move into a protectionist mode because Obama and the Democrats appear to be so resistant to free trade agreements. Certainly, any protectionist movement by the United States could seriously hamper international trade and that could ripple throughout the global economy. America is still looked upon as the primary driver in any world economy. What investor's are seeing from America is causing global fear and not confidence.
Another evidence of the fear of Obama rule, is the fact that power and gas utility stocks have tanked almost 50% in the last year. Normally, utility stocks are "safe havens" because those companies have a captive consumer base that tends to have limited losses of profits in a recession. While those consumers might reduce consumption of electricity and natural gas, their is a finite limit to what they can do to save energy costs. At best, maybe 10 or 15 percent. For a gas or electric utility to fall as much as 50 percent makes no sense unless you really start thinking about what the investment community is saying. Under Obama's plan, dividend income will be taxed at the pre-Bush levels of 39.6% as compared to the current 15% rate. This fact, alone, makes utility stocks unattractive; especially in comparison to a tax-free municipal bond that is paying near 6 percent but is tax free. This is a substantially better investment than a utility stock that may be paying a 5% dividend and will carry a 40% tax rate under Obama.
There is another factor that seems to be hitting the usually "safe" utility stocks. Barack Obama (and John McCain, for that matter) are global warming preventionists. Utility companies in this country generally deal in the consumption of carbon based fuels that output green house gases. All this talk of imposing penalties on them for burning natural gas or coal is just going to ruin profits and growth. Any push for wind and solar is seen as competing businesses that reduce their economic base of customers. That's why these usually friendly investments have been hit so hard.
No investor is going to put their money at the curb for the Obama recycling truck to come, pickup, and distribute to someone else. The current movements in the stock market speak volumes as to what is being feared under an Obama Administration. This isn't like the old E. F. Hutton TV commercials, where you had to lean in to overhear what is being said about investment advice. This market is screaming that advice. And, that advice is to watch out for Obama!
Now, to the point of this commentary.
Every evening, I quickly scan through the stocks and Exchange Traded Funds (ETFs) that may have had gains for that day. What I have been noticing over the last 10 day is that Municipal Bond ETFs are seeing quite a lot of gains. For example, the Alliance Bernstein National Municipal Income Fund, Symbol AFB, has risen 50% in the last 10 days of trading. The Van Kampen Municipal Trust, symbol VKQ, had a 38% increase. The BFK or Blackrock Muni Trust saw 41% in gains. 30% was seen in the MFL or Blackrock Municipal Holdings Insured Investment Holdings Trust. The list is actually quite long.
Municipal bonds are offered by local and state governments to secure a loan in the form of a bond in order to cover the high cost of some building project. This can be for the expansion of a state university or for new or repaired city roads, etc. The main reason that they are attractive to the investment community is that they are Federally tax free; and, that is an important point in today's context.
This sudden activity in all these Muni-bond funds clearly indicates a movement from Federally taxed investments to tax-free investments. People are apparently trying to get in on the bottom floor of what could be a tsunami of movement into these kinds of investment instruments. What this activity is really saying, in my opinion, is that some investors are moving their money away from what could be high capital gains taxes under a Democratic/Obama controlled government. This is clear evidence that smart money is saying Obama is going to win and that taxable capital assets are not the place to be. This is also surprising because, in a weak economy, state and local tax revenues are sure to go down. As a result, the risk associated with any municipal bonds and the potential defaults on those bonds will go up as bond rating agencies, most assuredly, downgrade these types of investments.
Clearly, there is fear about a recession which has caused the stock market to decline. However, this Muni bond action proves that there is actually a political component that is responsible for the stock market's going down. There is no real business person or investor in this world that would believe that Mr. Obama's tax plans won't be extremely detrimental to businesses in this country and to the global economy. Investors are yanking their money out of the stock markets, around the world, in order to keep their powder dry until they can navigate through the future of investing. That future definitely includes the plans that Obama and the Democrats have in store for business in this country. I also think that the investment community is concerned that we will move into a protectionist mode because Obama and the Democrats appear to be so resistant to free trade agreements. Certainly, any protectionist movement by the United States could seriously hamper international trade and that could ripple throughout the global economy. America is still looked upon as the primary driver in any world economy. What investor's are seeing from America is causing global fear and not confidence.
Another evidence of the fear of Obama rule, is the fact that power and gas utility stocks have tanked almost 50% in the last year. Normally, utility stocks are "safe havens" because those companies have a captive consumer base that tends to have limited losses of profits in a recession. While those consumers might reduce consumption of electricity and natural gas, their is a finite limit to what they can do to save energy costs. At best, maybe 10 or 15 percent. For a gas or electric utility to fall as much as 50 percent makes no sense unless you really start thinking about what the investment community is saying. Under Obama's plan, dividend income will be taxed at the pre-Bush levels of 39.6% as compared to the current 15% rate. This fact, alone, makes utility stocks unattractive; especially in comparison to a tax-free municipal bond that is paying near 6 percent but is tax free. This is a substantially better investment than a utility stock that may be paying a 5% dividend and will carry a 40% tax rate under Obama.
There is another factor that seems to be hitting the usually "safe" utility stocks. Barack Obama (and John McCain, for that matter) are global warming preventionists. Utility companies in this country generally deal in the consumption of carbon based fuels that output green house gases. All this talk of imposing penalties on them for burning natural gas or coal is just going to ruin profits and growth. Any push for wind and solar is seen as competing businesses that reduce their economic base of customers. That's why these usually friendly investments have been hit so hard.
No investor is going to put their money at the curb for the Obama recycling truck to come, pickup, and distribute to someone else. The current movements in the stock market speak volumes as to what is being feared under an Obama Administration. This isn't like the old E. F. Hutton TV commercials, where you had to lean in to overhear what is being said about investment advice. This market is screaming that advice. And, that advice is to watch out for Obama!
Code Pink Attempts to Assault Karl Rove
Wednesday, the anti-war group, Code Pink, took their protest activities to a new low. While Karl Rove was attending a mortgage banker's group meeting in San Francisco, a Code Pinker decided to handcuff Karl for treason in the middle of that meeting (See Video). Even in left-wing San Francisco, her actions were nothing short of assault and, fortunately, she was arrested and taken off the stage before she could do anything. She claimed to be making a citizen's arrest.
The laws concerning citizen's arrest vary minutely from state to state. The underlining theme is that a citizen's arrest can be made only if a felony is in the process of being observed. The arrest is for detainment for questioning by an authorized law enforcement person or agency and cannot be done with injurious force.
In this case, the Code Pink person, Janine Boneparte, was committing an assault and, potentially, a battery on Mr. Rove. Being at that meeting was hardly committing "treason." She had no legal standing to make a citizen's arrest. Her actions were based on her own personal interpretation of the law and on some assumption that a felony was committed in the past. I hardly think she was in the room when, supposedly, Mr. Rove committed her assumed crime of treason. Even if she had, her only window of opportunity in making a citizen's arrest was at that time.
Trying to put handcuffs on someone with whom you simply disagree with and who has done nothing to physically harm you is assault and/or battery. Throwing a pie, or feces, urine, blood or anything else at someone is also assault and battery. Over the last eight years, we have seen, time after time, cases of this as the left has tried to silence or harass persons on the right. Until the law and law enforcement takes these actions more seriously, it won't be long before something happens that is a lot more serious than an pie being thrown. All too often, these offenders are simply detained; then, released (See Full Story). This is sending the wrong signal and setting the stage for more serious harm in the future. You want an example of a hate crime. This is it!
The laws concerning citizen's arrest vary minutely from state to state. The underlining theme is that a citizen's arrest can be made only if a felony is in the process of being observed. The arrest is for detainment for questioning by an authorized law enforcement person or agency and cannot be done with injurious force.
In this case, the Code Pink person, Janine Boneparte, was committing an assault and, potentially, a battery on Mr. Rove. Being at that meeting was hardly committing "treason." She had no legal standing to make a citizen's arrest. Her actions were based on her own personal interpretation of the law and on some assumption that a felony was committed in the past. I hardly think she was in the room when, supposedly, Mr. Rove committed her assumed crime of treason. Even if she had, her only window of opportunity in making a citizen's arrest was at that time.
Trying to put handcuffs on someone with whom you simply disagree with and who has done nothing to physically harm you is assault and/or battery. Throwing a pie, or feces, urine, blood or anything else at someone is also assault and battery. Over the last eight years, we have seen, time after time, cases of this as the left has tried to silence or harass persons on the right. Until the law and law enforcement takes these actions more seriously, it won't be long before something happens that is a lot more serious than an pie being thrown. All too often, these offenders are simply detained; then, released (See Full Story). This is sending the wrong signal and setting the stage for more serious harm in the future. You want an example of a hate crime. This is it!
Wednesday, October 22, 2008
How Easily Democrats Are Forgetting 9/11
Recently, Bill Clinton was campaigning for Barack Obama. In his speech he touted the fact that he created 22 million jobs during his administration and how, when he left office, he left with a budget surplus. Barack Obama has similarly commented on Bill Clinton's accomplishments. At the same time, they trashed the Bush administration on job creation and for creating budget deficits.
Certainly, they are right on the numbers. The Bush administration hasn't done well on job creation and maintaining a budget surplus. Democrats would certainly point to the wastefulness of the Iraq war as an underlining cause.
But, never once do the Democrats, especially Barack Obama, ever mention the recession handed to George Bush by Bill Clinton or the compounding impact of 9/11 on our economy. They never mention how it literally took until the end of 2005, just 3 years ago, for things to start turning around. All those Bush tax cuts were aimed at restoring this country after trillions were lost in this economy. They were done to create jobs that were lost to the economic downturn. They fail to mention how unemployment numbers around and below 6 percent are still historically low. They fail to mention all the spending and tax cuts that were done to stimulate the economy; just as we are spending billions, today, to fix the subprime credit crisis. Barack Obama and Bill Clinton seem to forget how businesses and air travel were seriously affected by 9/11. They forget how much money had to be dumped into Homeland Security and the TSA to protect and strengthen this country against another attack. They always talk about the Iraq war but, conveniently forget about all the costs associated with Afghanistan. Billions were spent to beef up airport and seaport security. Hundreds of government buildings and facilities around the world were modified to avoid drive-up bombers; and, thousands of security personnel were hired to secure our airports and government buildings. Lastly, they fail to recognize that 10 million low-income people don't have to pay any income taxes today, thanks to the Bush tax cuts that supposedly only benefited the rich.
For the last 6 years, the Democrats have complained that containers aren't being individually examined at seaports. One can only imagine what the deficits would be like today if they, rather than Republicans, were in charge of Congress from 9/11 to 2003. Do you really think we would be limited to the amount of union TSA workers that we have today? Not hardly. The Democrats would have easily seized on 9/11 as a means of payback to the unions by having security personnel "manually" unload and examine every single container that came into our ports. That fact, alone, would add thousands of more union employees on the government tab and would have brought our sea trade to a standstill.
It just seems like the Democrats conveniently forget 9/11 when it comes to the deficit spending and jobs. 9/11 seriously hurt our economy. It cost this country a fortune in spending for new and preventative measures. What had to be done with taxes and spending had to be done. The Bush administration did what was expected of it. They had to get this country back on an economic footing and provide protection for us all. Despite the current housing/credit crisis, this country did get back to economic growth. We haven't had another attack for 7 years. And, the deficit had been going down as the tax revenues reached record levels.
It is too bad that the politics of winning the White House has to minimize the impact of 9/11 and all that we suffered as a country as a result of it. 9/11 was a horrible loss of lives and an event that changed America's sense of security forever. What ever happened to the slogan of "We will always remember"?
Certainly, they are right on the numbers. The Bush administration hasn't done well on job creation and maintaining a budget surplus. Democrats would certainly point to the wastefulness of the Iraq war as an underlining cause.
But, never once do the Democrats, especially Barack Obama, ever mention the recession handed to George Bush by Bill Clinton or the compounding impact of 9/11 on our economy. They never mention how it literally took until the end of 2005, just 3 years ago, for things to start turning around. All those Bush tax cuts were aimed at restoring this country after trillions were lost in this economy. They were done to create jobs that were lost to the economic downturn. They fail to mention how unemployment numbers around and below 6 percent are still historically low. They fail to mention all the spending and tax cuts that were done to stimulate the economy; just as we are spending billions, today, to fix the subprime credit crisis. Barack Obama and Bill Clinton seem to forget how businesses and air travel were seriously affected by 9/11. They forget how much money had to be dumped into Homeland Security and the TSA to protect and strengthen this country against another attack. They always talk about the Iraq war but, conveniently forget about all the costs associated with Afghanistan. Billions were spent to beef up airport and seaport security. Hundreds of government buildings and facilities around the world were modified to avoid drive-up bombers; and, thousands of security personnel were hired to secure our airports and government buildings. Lastly, they fail to recognize that 10 million low-income people don't have to pay any income taxes today, thanks to the Bush tax cuts that supposedly only benefited the rich.
For the last 6 years, the Democrats have complained that containers aren't being individually examined at seaports. One can only imagine what the deficits would be like today if they, rather than Republicans, were in charge of Congress from 9/11 to 2003. Do you really think we would be limited to the amount of union TSA workers that we have today? Not hardly. The Democrats would have easily seized on 9/11 as a means of payback to the unions by having security personnel "manually" unload and examine every single container that came into our ports. That fact, alone, would add thousands of more union employees on the government tab and would have brought our sea trade to a standstill.
It just seems like the Democrats conveniently forget 9/11 when it comes to the deficit spending and jobs. 9/11 seriously hurt our economy. It cost this country a fortune in spending for new and preventative measures. What had to be done with taxes and spending had to be done. The Bush administration did what was expected of it. They had to get this country back on an economic footing and provide protection for us all. Despite the current housing/credit crisis, this country did get back to economic growth. We haven't had another attack for 7 years. And, the deficit had been going down as the tax revenues reached record levels.
It is too bad that the politics of winning the White House has to minimize the impact of 9/11 and all that we suffered as a country as a result of it. 9/11 was a horrible loss of lives and an event that changed America's sense of security forever. What ever happened to the slogan of "We will always remember"?
Tuesday, October 21, 2008
The Stock Market's Flat-Sided Triangle
As a person who follows technical trends in the stock market, my eyes light up when I see patterns develop that might give an inclination as to the next direction of the stock market. Over the last 9 trading days, a pattern called an "ascending triangle" has formed in association with the trading of the 30 stocks that make up the Dow Jones Industrial Average. The ascending triangle is a triangle that has its flat-side on top of the triangle. Normally, it is associated with a pause in an up market. Occasionally, however, it can signal the end of a down market.
Typically, the flat-side of an ascending triangle represents a point of resistance where traders come in to sell and try to escape from a falling market. As the number of "escapees" declines, each move to the downside is less than the previous day's or week's activity. Thus, an ascending triangle is formed. Usually, and not always, that flat line of resistance is broken as the last remaining "escapees" are eliminated; and, the result is that the trading in that stock or, as in this case, the "Dow" breaks to the upside and it can signal the end of selling in a bull market or, in this case, the possible bottom of a current selling trend.
It is quite "possible" (not ever for sure) that the free fall of the stock market is over. That doesn't mean that it is straight up from here. But, it might mean that we are seeing an abatement of all those almost viral losses that have hit the market over the last year. From here, the stock market may climb upwards and, then, somewhat fall. As a result, we could be in a lateral move for months as investors try and figure out whether or not this economy is really out of the woods. I personally have been out of the market for about a year. It now looks like it might be time to buy on a limited basis. I think that utility stocks or utility stock mutual funds or utility oriented ETF's (Exchange Trade Funds) with good dividend returns and good or excellent ratings would be a safer (never safe) place to get your toes wet because, irrationally, they have been hit extremely hard in this free fall. But, as always, this is just my opinion. No one should ever take financial advice from a stranger. You should always seek professional insights from your brokerage firm, investment adviser, or a ratings service like Standards and Poors, Value Line, or Morningstar.
One last comment for other market technicians. Another technical indicator, the Moving Average Convergence and Divergence or MACD has also showed a bottom as of 9 trading days ago. Further, the weekly bar chart of the MACD may be similarly hinting at such a bottom with volume confirmation. Additionally, on the weekly charts, there is a an extreme "tweezers bottom" (two hammers together) showing for those of you who might follow Japanese Candlestick Analysis. Lastly, the divergence pattern of the ADX line appears to be at an extreme apex on a weekly basis and it could very much signal a market bottom. At the very least, this market is truly oversold enough to see some nibbling.
For Once, I Agree With Joe Biden (Somewhat)
In April, I wrote a piece titled: "Are We Ready for the Mistakes of JFK, Again?" (See Full Story). As I explained in that essay, it was Kennedy's own perceived weakness that caused Russia to move missiles into Cuba. It absolutely wasn't out of any perceived strength in his character. I went on to compare Obama to Kennedy and how his policies, especially talks without preconditions, can be easily perceived as weakness. I hinted that Obama could be tested by the likes of Iran, Russia, and Venezuela. I think you could easily add to that list the likes of Al Qaeda/Taliban, Hamas/Hezbollah, Syria, and, especially, North Korea.
Now, Joe Biden has predicted the same (See Full Story). Of what Joe said, the following is the most important statement: "Watch, we're gonna have an international crisis, a generated crisis, to test the mettle of this guy." Of his statement, "a generated crisis, to test the mettle" seems to say it all. It will be "generated" because of what all those foreign entities. as noted above, see as weakness in Barack Obama. It will assuredly be done "to test his mettle" and to see how much they can get away with, with this "new kid" (and, I mean new 'kid') on the block. If Barack stumbles in his response, expect more and more of the same.
One can only ask what we are getting ourselves into with Barack Obama as President. One could, if not a biased Democrat and a believer in Joe Biden's words, say that a vote for Obama is to vote for an international crisis. Not once in Biden's thesis and prognostication did he mention that the same would happen if McCain were elected. In essence, Joe is saying that an international crisis will be "generated" because of Barack Obama becoming President.
Let's not forget that we have a new axis of evil to deal with at this time in history. That "axis" is already made up of Russia, Iran, North Korea, and Venezuela. All these countries' leaders have been busy working with each other. Chavez, specifically, has traveled to Russia, North Korea, and Iran. They have been exchanging information on nukes and talking down the United States. Russia, Iran, and North Korea have flexed their muscles by conducting missiles tests as if to say "watch out" and to imply that they are coming after us. And, as for Venezuela not having missiles to test, I don't think it is out of the realm to assume that Venezuela becomes the new Cuban missile crisis by agreeing to allow Russian nuclear missiles on their soil. That is one possible test for Obama to confront.
Joe seems to think that Obama will do well in this crisis; although, with "tough, and possibly unpopular, decisions..." This is were I differ from Joe. Obama has a history of avoiding tough decisions. In the Illinois Senate, he voted "present" 130 times to avoid taking a specific stand and to avoid voting either "yea" or "nay" on tough issues. When that call comes in at three in the morning, are we going to get a tough answer or, as usual, are we simply going to get a "present" declaration from a President Obama? My guess is that the "axis of evil" is betting on the latter response and that's why they all think that he should be "tested" when he takes office. Just like Joe said in his prophecy, I, too, can say: "Mark my words!"
One final comment. We may actually see something happen shortly before Obama takes office. This would be a time where Bush would be in a very limited position to define a response and at a time where Obama has barely assembled an Administration that could respond to any international crisis. Late December and early January could be a very tenuous time for this country.
Now, Joe Biden has predicted the same (See Full Story). Of what Joe said, the following is the most important statement: "Watch, we're gonna have an international crisis, a generated crisis, to test the mettle of this guy." Of his statement, "a generated crisis, to test the mettle" seems to say it all. It will be "generated" because of what all those foreign entities. as noted above, see as weakness in Barack Obama. It will assuredly be done "to test his mettle" and to see how much they can get away with, with this "new kid" (and, I mean new 'kid') on the block. If Barack stumbles in his response, expect more and more of the same.
One can only ask what we are getting ourselves into with Barack Obama as President. One could, if not a biased Democrat and a believer in Joe Biden's words, say that a vote for Obama is to vote for an international crisis. Not once in Biden's thesis and prognostication did he mention that the same would happen if McCain were elected. In essence, Joe is saying that an international crisis will be "generated" because of Barack Obama becoming President.
Let's not forget that we have a new axis of evil to deal with at this time in history. That "axis" is already made up of Russia, Iran, North Korea, and Venezuela. All these countries' leaders have been busy working with each other. Chavez, specifically, has traveled to Russia, North Korea, and Iran. They have been exchanging information on nukes and talking down the United States. Russia, Iran, and North Korea have flexed their muscles by conducting missiles tests as if to say "watch out" and to imply that they are coming after us. And, as for Venezuela not having missiles to test, I don't think it is out of the realm to assume that Venezuela becomes the new Cuban missile crisis by agreeing to allow Russian nuclear missiles on their soil. That is one possible test for Obama to confront.
Joe seems to think that Obama will do well in this crisis; although, with "tough, and possibly unpopular, decisions..." This is were I differ from Joe. Obama has a history of avoiding tough decisions. In the Illinois Senate, he voted "present" 130 times to avoid taking a specific stand and to avoid voting either "yea" or "nay" on tough issues. When that call comes in at three in the morning, are we going to get a tough answer or, as usual, are we simply going to get a "present" declaration from a President Obama? My guess is that the "axis of evil" is betting on the latter response and that's why they all think that he should be "tested" when he takes office. Just like Joe said in his prophecy, I, too, can say: "Mark my words!"
One final comment. We may actually see something happen shortly before Obama takes office. This would be a time where Bush would be in a very limited position to define a response and at a time where Obama has barely assembled an Administration that could respond to any international crisis. Late December and early January could be a very tenuous time for this country.
Monday, October 20, 2008
Credit Is Easing
Don't quite pop the champagne yet, but it appears that there is some movement towards credit easing that could spell the end of the subprime/credit disaster, and avert the possibility of any long term recession. The London Interbank Offered Rate or LIBOR (pronounced lie-bore), is the measurement of what banks charge each other for short term loans to cover normal day-to-day shortages in cash. Since January, the LIBOR rate associated with the U.S. dollar has been rising and indicating a tightening of credit between banks. Not a good thing. Especially if you are a bank and you've got depositors yanking their money out of fear of a bank failure. Not having enough cash can cause a bank to easily fail in this environment.
Now, for the first time since January, the lending rate for 3-month loans between banks is breaking to the downside (See Full Story). All the billions of dollars of credit easing action by our Federal Reserve and Treasury Departments and World Banks appears to be starting to work.
Once the banking system can feel more confident about their operations, this can lead to consumer and business lending getting looser. This could free up cash to keep our economy going and avert a crippling and deep recession or, even a depression. It might just be that all the actions by the Bush Administration and the world's banks (like our own Federal Reserve) might have caused us to dodge a major bullet. We probably won't know that to be true until the summer of next year. Let's all hope for the best.
Now, for the first time since January, the lending rate for 3-month loans between banks is breaking to the downside (See Full Story). All the billions of dollars of credit easing action by our Federal Reserve and Treasury Departments and World Banks appears to be starting to work.
Once the banking system can feel more confident about their operations, this can lead to consumer and business lending getting looser. This could free up cash to keep our economy going and avert a crippling and deep recession or, even a depression. It might just be that all the actions by the Bush Administration and the world's banks (like our own Federal Reserve) might have caused us to dodge a major bullet. We probably won't know that to be true until the summer of next year. Let's all hope for the best.
Colin Powell: Is He Suddenly Now In Belafonte's Good Graces?
In 2002, the singer Harry Belafonte referred to Colin Powell and Condoleezza Rice "house niggers" for being too connected to the Bush Administration and its policies. As Black News Weekly reported, Mr. Belafonte appeared on "Larry King" to defend that position (See Full Story).
My intent of mentioning the above incident is to highlight the opinion of the left, albeit very extreme in this particular case, about Colin Powell. He has never been, nor been seen as a supporter of liberal viewpoints. To say, now, that he is endorsing Barack Obama, and that "race" has nothing to do with it is a little hard to fathom (See Full Story).
As a former, premier military leader of this country, I find it difficult to believe that Colin Powell supports Barack Obama's direction for our armed forces (See the video). This, alone, should be a big issue for Colin Powell. Much like Bill Clinton did in the 1990's, Barack Obama will literally stifle advanced weapon systems and severely limit military spending so he can have his planned government "give-away" programs. Additionally, Mr. Obama doesn't believe in any expanded or even continued intelligence activities, such as the recent changes in FISA, and he would put unreasonable privacy rights ahead of this country's protection. Is that what Colin Powell believes would be "good" and "transformational" for America?
Beyond the military, if Colin Powell really believes in all the other liberal policies of Mr. Obama, where was he with his endorsements of John Kerry and Al Gore? Most of what Barack Obama stands for is hardly any different from these previous Democratic candidates. In fact, Mr. Obama just may be further left in his political views than those two guys! As far as I can remember, Mr. Powell backed George W. Bush and Bob Dole in past elections.
So, Mr. Powell... You want us all to believe that your decision to back Obama has nothing to do with race? I don't even think Harry Belafonte would believe that!
My intent of mentioning the above incident is to highlight the opinion of the left, albeit very extreme in this particular case, about Colin Powell. He has never been, nor been seen as a supporter of liberal viewpoints. To say, now, that he is endorsing Barack Obama, and that "race" has nothing to do with it is a little hard to fathom (See Full Story).
As a former, premier military leader of this country, I find it difficult to believe that Colin Powell supports Barack Obama's direction for our armed forces (See the video). This, alone, should be a big issue for Colin Powell. Much like Bill Clinton did in the 1990's, Barack Obama will literally stifle advanced weapon systems and severely limit military spending so he can have his planned government "give-away" programs. Additionally, Mr. Obama doesn't believe in any expanded or even continued intelligence activities, such as the recent changes in FISA, and he would put unreasonable privacy rights ahead of this country's protection. Is that what Colin Powell believes would be "good" and "transformational" for America?
Beyond the military, if Colin Powell really believes in all the other liberal policies of Mr. Obama, where was he with his endorsements of John Kerry and Al Gore? Most of what Barack Obama stands for is hardly any different from these previous Democratic candidates. In fact, Mr. Obama just may be further left in his political views than those two guys! As far as I can remember, Mr. Powell backed George W. Bush and Bob Dole in past elections.
So, Mr. Powell... You want us all to believe that your decision to back Obama has nothing to do with race? I don't even think Harry Belafonte would believe that!
Dewey Wins?
In the history of this country, there is one election, Truman vs. Dewey, where the underdog truly became the come-back-kid. By that election day, the final Gallup polling had Dewey 5 full points ahead of Truman. The whole country thought that Truman was doomed to lose. In fact, one of the most famous pictures in political history is Truman holding a copy of the "Chicago Daily Tribune" that was erroneously published and declares: "Dewey Defeats Truman" (Click to see this historical Associated Press photo).
Early last week, John McCain aptly declared himself the underdog. Certainly, the polls reflect that fact with Barack Obama leading by as much as 14 points, nationally. Some projected Electoral Map calculations show Obama with over 300 electoralvotes, with only 270 needed to win. Even I, just a couple of weeks ago, said that this economic disaster may have given Obama the win.
However, there is a possibility that John McCain, like Truman, may win this.
The Obama campaign has targeted the "youth" voters from day one. But, the younger voter is the most historically unpredictable. If Obama has a significant lead, these less dedicated "youths" might just skip going to the polls. If enough think that way, it could swing this in John McCain's direction. Actually, some might not go to the polls no matter what is happening in the polling.
Through the most recent polling results, we know that the "undecided" voters are between 7 and 16 percent; depending on the polling source you look at. If, for some reason, John McCain can sway those votes in the final hours, it could spell a win. Usually, though, this group of voters tends to follow the general polling. But, there are so many open issues about Obama and his past that the undecided's might not feel comfortable with that uncertainty. Some might not be comfortable with "completely" turning over all of the reins of government to the Democrats. Others might be concerned about the effects of being too liberal in an economic crisis. A two or three percent swing of the undecideds McCain's way could really change the results of this election. It should be noted that independents have been somewhat moving away from Obama in the last few days.
Then, of course, there is the possibility of the Bradley Effect. Basically, this is a documented trend by voters saying in polls that they will vote for the black candidate and, then, vote to the contrary when pulling the lever in the hidden confines of the voting booth. The "effect" is generally believed to have resulted from whites not wanting to look like racists when directly confronted by a pollster. Ironically, it can also be some blacks that don't want to appear to be voting against a black person because they might look like an "Uncle Tom". Historians have documented this effect to be as much as 6 percent. If Obama has less than a 6 percent lead over McCain, and this "effect" actually happens, McCain could pull this off.
This election, more than any other, has people looking at one candidate because of his "promises" rather than his past actions. This election has also become a media driven election for a variety of reasons that include making history. However, what happens in the privacy of the voting booth might not be what the polls are saying. It might not be what our mainstream media wants to happen. While it is hard to imagine John McCain wining with such a completely weak outlook according to the Electoral Maps, there is always the possibility of a repeat of the Dewey/Truman contest. But, who really knows? Even Obama, himself, expressed his concern over losing when he said "Don't Underestimate Our Ability to Screw it Up" (See Full Story). During the primaries, time after time, Hillary Clinton had substantially better performances on primary day against Barack Obama than the polls were saying. The same just might happen to Obama against McCain.
I just think this election may be the most interesting in our history, and if McCain does have a shot at winning, it could be a very, very, long night and a very, very, close election. If McCain does win, expect Obama's lawyers to be unleashed across this country like a massive herd of wild mustangs. This election could make Gore v. Bush look like legal amateur night in comparison to what could happen between McCain and Obama.
Early last week, John McCain aptly declared himself the underdog. Certainly, the polls reflect that fact with Barack Obama leading by as much as 14 points, nationally. Some projected Electoral Map calculations show Obama with over 300 electoralvotes, with only 270 needed to win. Even I, just a couple of weeks ago, said that this economic disaster may have given Obama the win.
However, there is a possibility that John McCain, like Truman, may win this.
The Obama campaign has targeted the "youth" voters from day one. But, the younger voter is the most historically unpredictable. If Obama has a significant lead, these less dedicated "youths" might just skip going to the polls. If enough think that way, it could swing this in John McCain's direction. Actually, some might not go to the polls no matter what is happening in the polling.
Through the most recent polling results, we know that the "undecided" voters are between 7 and 16 percent; depending on the polling source you look at. If, for some reason, John McCain can sway those votes in the final hours, it could spell a win. Usually, though, this group of voters tends to follow the general polling. But, there are so many open issues about Obama and his past that the undecided's might not feel comfortable with that uncertainty. Some might not be comfortable with "completely" turning over all of the reins of government to the Democrats. Others might be concerned about the effects of being too liberal in an economic crisis. A two or three percent swing of the undecideds McCain's way could really change the results of this election. It should be noted that independents have been somewhat moving away from Obama in the last few days.
Then, of course, there is the possibility of the Bradley Effect. Basically, this is a documented trend by voters saying in polls that they will vote for the black candidate and, then, vote to the contrary when pulling the lever in the hidden confines of the voting booth. The "effect" is generally believed to have resulted from whites not wanting to look like racists when directly confronted by a pollster. Ironically, it can also be some blacks that don't want to appear to be voting against a black person because they might look like an "Uncle Tom". Historians have documented this effect to be as much as 6 percent. If Obama has less than a 6 percent lead over McCain, and this "effect" actually happens, McCain could pull this off.
This election, more than any other, has people looking at one candidate because of his "promises" rather than his past actions. This election has also become a media driven election for a variety of reasons that include making history. However, what happens in the privacy of the voting booth might not be what the polls are saying. It might not be what our mainstream media wants to happen. While it is hard to imagine John McCain wining with such a completely weak outlook according to the Electoral Maps, there is always the possibility of a repeat of the Dewey/Truman contest. But, who really knows? Even Obama, himself, expressed his concern over losing when he said "Don't Underestimate Our Ability to Screw it Up" (See Full Story). During the primaries, time after time, Hillary Clinton had substantially better performances on primary day against Barack Obama than the polls were saying. The same just might happen to Obama against McCain.
I just think this election may be the most interesting in our history, and if McCain does have a shot at winning, it could be a very, very, long night and a very, very, close election. If McCain does win, expect Obama's lawyers to be unleashed across this country like a massive herd of wild mustangs. This election could make Gore v. Bush look like legal amateur night in comparison to what could happen between McCain and Obama.
Sunday, October 19, 2008
The Lessons of the WPA and the Great Depression
One of Franklin D. Roosevelt's Administration's schemes to get our country back on track in the midst of the Great Depression was the WPA or Work Progress Administration. Basically, it was a big, government welfare program to get people working on selected infrastructure, arts/media, and other social programs. Thousands of unskilled and unemployed workers were taken off the streets and given jobs on public works projects. Many of these projects took 2 or 4 times longer to be completed because of "slackers" (people knowing that they were just getting a guaranteed government pay check) and because they didn't have the true skills to get the jobs done. There was a widespread joke in America that "WPA" actually meant "Workers (just) Putting Around".
The government also funded film making and a continuation of the arts and drama; as if those items would really help this country get back on its feet. If you watch old movies from the 1930's and early 1940's (as shown on Turner Classic Movies), you will still see the WPA insignia/symbol being displayed on the credits for those movies. Like every other government program, it was political payback, cronyism, and political loyalties that got all the funding for the WPA projects.
If you listen to a lot of Democrats, like Barack Obama, it is public works and infrastructure rebuilding that will get this country going again. Often, they will point back to FDR's WPA as the mechanism for pulling this country out of its economic morass. However, the WPA didn't actually pull this country out of anything. To think this was the case is to literally rewrite history and not understand the economics of that time. WPA just put a lot of people on government welfare under the guise of working. It just burned through tax money and didn't really grow our economy. It was World War II and workers like Rosie the Riveter who were put to work by a wartime economy and were appropriately trained and utilized by major corporations like Chrysler, General Motors, Remington, McDonald Douglas, etc. that brought true economic recovery. There was no true unemployment reversal that could be attributable to the WPA before the war. The marjority of those employed by the WPA in public works went elsewhere as a result of the war and leading up to the program being dissolved in 1943. Unemployment in America was still around 14% just before the war. During the war, unemployment fell under 2 percent as America was near fully mobilized for the war effort. After the war, it moved up to a more normal rate of 6 percent by 1949. There wasn't a return to pre-depression GNP (Gross National Product - see note below) until 1946; a year after the war ended. We had 17 years of economic doldrums from 1929 to 1946. It wasn't public works or arts that got this country going. It was World War II and corporations hiring and training people for our war effort that was responsible. Maybe the Democrats should "completely" follow history have another World War to get us out of the next depression?
You should think about the realities of the WPA when Barack Obama talks about spending billions on wind, solar, and infrastructure projects and how that will falsely create 5 million new jobs. Also, think about the true recovery from the Great Depression when you hear of his plans to hamper our large corporations and small businesses with excessive regulation and new taxation. Maybe I'm wrong, but I just think Obama has his priorities all back-assward! Again, he is being the socalist and not the capitalist.
Note: Today, we measure this country's economic output in what is called the GDP or Gross Domestic Product Report. Back then, that measurement was calculated differently, using the GNP or Gross National Product. The change was made due to the fact that most of our products were being imported and not domestically produced.
Also note: This blog entry was accidentally published when it was still in draft form with some significant errors in GNP during the depression.
The government also funded film making and a continuation of the arts and drama; as if those items would really help this country get back on its feet. If you watch old movies from the 1930's and early 1940's (as shown on Turner Classic Movies), you will still see the WPA insignia/symbol being displayed on the credits for those movies. Like every other government program, it was political payback, cronyism, and political loyalties that got all the funding for the WPA projects.
If you listen to a lot of Democrats, like Barack Obama, it is public works and infrastructure rebuilding that will get this country going again. Often, they will point back to FDR's WPA as the mechanism for pulling this country out of its economic morass. However, the WPA didn't actually pull this country out of anything. To think this was the case is to literally rewrite history and not understand the economics of that time. WPA just put a lot of people on government welfare under the guise of working. It just burned through tax money and didn't really grow our economy. It was World War II and workers like Rosie the Riveter who were put to work by a wartime economy and were appropriately trained and utilized by major corporations like Chrysler, General Motors, Remington, McDonald Douglas, etc. that brought true economic recovery. There was no true unemployment reversal that could be attributable to the WPA before the war. The marjority of those employed by the WPA in public works went elsewhere as a result of the war and leading up to the program being dissolved in 1943. Unemployment in America was still around 14% just before the war. During the war, unemployment fell under 2 percent as America was near fully mobilized for the war effort. After the war, it moved up to a more normal rate of 6 percent by 1949. There wasn't a return to pre-depression GNP (Gross National Product - see note below) until 1946; a year after the war ended. We had 17 years of economic doldrums from 1929 to 1946. It wasn't public works or arts that got this country going. It was World War II and corporations hiring and training people for our war effort that was responsible. Maybe the Democrats should "completely" follow history have another World War to get us out of the next depression?
You should think about the realities of the WPA when Barack Obama talks about spending billions on wind, solar, and infrastructure projects and how that will falsely create 5 million new jobs. Also, think about the true recovery from the Great Depression when you hear of his plans to hamper our large corporations and small businesses with excessive regulation and new taxation. Maybe I'm wrong, but I just think Obama has his priorities all back-assward! Again, he is being the socalist and not the capitalist.
Note: Today, we measure this country's economic output in what is called the GDP or Gross Domestic Product Report. Back then, that measurement was calculated differently, using the GNP or Gross National Product. The change was made due to the fact that most of our products were being imported and not domestically produced.
Also note: This blog entry was accidentally published when it was still in draft form with some significant errors in GNP during the depression.
Saturday, October 18, 2008
The Long Knives Are Out for Joe "The Plumber"
Ever since, Samuel Joseph Wurzelbacher, aka Joe "The Plumber", asked a truly simple question of Barack Obama, the mainstream media, team Obama, and Obama supporters have been busy cutting and slicing up "Joe's" personal life. They have actually done investigative reporting on this guy (something they've never really done on Obama, himself) like he was the "one" who is running for office. Every word of reporting by the left wing media is aimed at totally trying to discredit him. They have found that (1) he has a $1600 outstanding tax bill, (2) his name ain't Joe (even though it's his middle name), and (3) he doesn't have a plumber's license. He's being ridiculed for being a plumber who has a shot at the American Dream by having a shot at making more the $250,000 a year in his life. Oh...the horror of that thought! Obviously, the American Dream under an Obama Administration is to drop out of school, work less, pay no taxes, and get spoon-fed by the government. Apparently, those making over $250,000 are just "broodmares" for Obama's system of socialism.
Lost in this whole barrage of attacks against "Joe" is the fact that Barack Obama clearly got caught with his pants down and, thus, exposed his true socialism. When Mr. Obama responded to Mr. Wurzelbacher's question about raising taxes, Obama played his socialist hand by responding that we need to "spread the wealth around".
The left knows that Barack's socialist answer is a real threat to his run for the Presidency. That's why they have gone into "KGB" mode to assassinate Joe. This is truly the case of trying to kill the messenger and not the message. Obviously, Team Obama got caught off balance on this. "Joe" was able to successfully do what the Hillary and McCain campaigns couldn't do against Barack's tax plans; and, so, the napalm is flying.
Hopefully, America won't forget Obama's left wing, socialist answer as they go to the polls. Unfortunately, "Joe", for just being an American with a question, is being flogged in the public forum. "Joe's" plight just shows how in-the-tank our media is for Barack Obama and, clearly, how they are not for the American Dream or the American way.
Lost in this whole barrage of attacks against "Joe" is the fact that Barack Obama clearly got caught with his pants down and, thus, exposed his true socialism. When Mr. Obama responded to Mr. Wurzelbacher's question about raising taxes, Obama played his socialist hand by responding that we need to "spread the wealth around".
The left knows that Barack's socialist answer is a real threat to his run for the Presidency. That's why they have gone into "KGB" mode to assassinate Joe. This is truly the case of trying to kill the messenger and not the message. Obviously, Team Obama got caught off balance on this. "Joe" was able to successfully do what the Hillary and McCain campaigns couldn't do against Barack's tax plans; and, so, the napalm is flying.
Hopefully, America won't forget Obama's left wing, socialist answer as they go to the polls. Unfortunately, "Joe", for just being an American with a question, is being flogged in the public forum. "Joe's" plight just shows how in-the-tank our media is for Barack Obama and, clearly, how they are not for the American Dream or the American way.
Friday, October 17, 2008
AP is at it AGAIN!
I love the AP (AssociatedPress) because they never fail to wear their bias on their sleeve. This morning they released their latest election poll data in conjunction with Yahoo. The headline read: "Poll: Voters souring on McCain, Obama stays steady". The article covered a synopsis of their poll data and included this graphic (Click to See Graphic). Throughout the entire article, the AP just kept hammering McCain about his lack of support on the economy, his favorability, etc. (Click to see the full story).
After reading it, you couldn't help but think that Barack Obama had some massive lead in this new polling data. Not once did the AP news story really mention the fact that Obama leads by a mere 2 points, 44 to 42, over McCain. You have to load the PDF file to actually glean that fact out of the data. I guess this fact was a reality that they would have preferred that you really didn't know. Actually, their polling data reveals this to be a virtual dead heat based on their own 5.1 to 6.7 percent margin of error for this poll. As complete Obama backers, AP cherry-picked pieces of data from the poll that would make Obama look fantastic, and show that McCain was "souring" among the voters. My guess is that they are trying to turn-off any McCain-leaning voters. Once again from AP, we get a commentary/op-ed instead of a simple reporting of the news. Welcome to a media-influenced campaign for Barack Obama!
Why Joe "The Plumber" is Mad
Under Barack Obama's tax plan, the difference between making $249,999 and $250,000 is amazing.
First, any "Joe the Plumber" (or "Josephine the Plumber", for that matter) that makes $249,999 will pay $12,750 in FICA taxes (also known as the payroll tax or the Social Security tax). If Joe happens to be unfortunate enough to make just a dollar more and fit into Obama's "rich" category by making $250,000, that FICA tax, the tax that is taken out of your pay before you even see your paycheck, will jump from a deduction of $12,750 to the new burden of $31,250. If Joe is a self-employed plumber making $250,000, you can add an additional 2.9 percent to that tax bill in the form of a self-employment tax for FICA and Medicare. Therefore, for that mere extra dollar in pay, Joe will immediately see a jump in their FICA taxes by $18,500; or, $22,792 if self-employed or a small business owner. And, for every additional dollar income, thereafter, you will be hit with an additional 12-1/2 percent in FICA taxation and another 2.9 percent in self-employed Medicare taxation (if applicable). That big "jump" in taxes is because Mr. Obama has intentionally, and very politically, left a "donut hole" in his proposed FICA tax tables so he can continue to make the claim that 95 percent of the people making under $250,000 will get a tax cut under his plan.
Currently, there is a tax ceiling of $102,000 on FICA. All incomes after that level pay no additional taxes for that purpose. Logic says that if you need to shore up the Social Security system, you should raise that ceiling; a practice that has been in effect for many years. However, if you are running for President and you want to have a slogan that says you will reduce taxes for anyone making under $250,000 (or 95 percent of tax payers), you can't raise that ceiling. To do that would only raise taxes on people who are currently making over $102,000 but, below $250,000. So, what do you do? Well, you play a game. You leave the tax in place for incomes up to $102,000. Then, you start the tax up again for any income levels above $250,000. This leaves a taxation hole or "donut hole" on the FICA tax from $102,000 to $250,000; and, it keeps your campaign slogan in tact. This is just one of the many "shady" games that Obama has been playing in order to get elected. He never does anything without thoroughly thinking through the political consequence of doing it. Being fair or truly logical never really enters into his equation.
So much for FICA. Now, lets focus on the effect of the new tax tables under Obama and how that would effect Joe if he makes $249,999 or just a dollar more at $250,000. If Joe is single, there would hardly be any difference in the tax at $249,999 or at $250,000. However, if married, Joe would see a jump in taxes. At $249,999, the married filing-jointly taxpayer would be hit with a 33 percent tax rate. For a dollar more, the tax rate jumps to 36 percent. Now married...Joe would have a tax bill of $82,500 for his salary of $249,999. If he makes a dollar more, his bill will jump to $90,000 for an increase of $7,500.
In addition, if Joe happens to invest his income in the stock market for his retirement years, Mr. Obama's plan will go after him with even more taxes. That's because Obama will raise the capital gains tax from 15 percent to 20 percent for all taxpayers making above $200,000 or, $250,000 for those married and filing jointly. Certainly, the application of this tax would be outside of any tax-free investment fund like an I.R.A. account that our "plumber" could be involved with. But, have no fear, when Joe starts pulling his money out of his previously tax-free IRA Account, the Tax Man, Obama, will be there waiting for him.
To recap, assuming our "plumber" is married and self-employed, the increased tax penalty of making $250,000 versus $249,999 under Obama is about $30,292. Quite the penalty for simply making a buck more than $249,999. Quite the penalty for being successful. A penalty that could easily put off expanding his business by hiring additional people at some later date. And that's the crux of raising taxes on a business like Joe's (or Josephine's).
Not included in this number (because I don't know what percs his business currently offers) is Obama's plans for healthcare. If our plumber's business doesn't currently provide any health insurance, it will certainly have to provide it under an Obama Administration. Depending on how many employees he has, it could easily cost our plumber more than $2500 a year per employee; assuming a 50 percent tax credit for any "employer provided healthcare" costs under Obama's plan.
Barack and his team would argue that "Joe" would get all kinds of small business tax breaks under his plan. Sure, if he hired another plumber at, say, $42,000 a year (the average minimum journeyman plumber's salary in America), the Obama plan would give him a small incentive deduction on his income tax. But, that credit would hardly offset his original increased taxes of $30,292 and the cost of his new employee with health insurance. If he still did it, he would be down over $70,000 from the current Bush system of taxation.
Obama's tax plan gives billions to those who don't pay tax. I really believe Joe the Plumber (who's full name is Samuel Joseph Wurzelbacher) is madder about that. Under an Obama administration, he will remove 15 million more low-income people from the tax rolls. This is above the 20 million more low-income people that the Bush's tax-cuts-for-the-rich system saved from paying taxes. And, that was over the Clinton Administration's 30 million who were dropped from paying taxes. When it's all said and done, it is expected that more than 55 million working Americans won't pay taxes. but, Obama's plan doesn't just stop at that. He will take the EITC (Earned Income Tax Credit) to new heights.
Currently, under the guise of the EITC, low-income tax filers who wind up paying no tax will actually receive a check from the IRS/U.S. Treasury if they have children. For having one child, a low income worker can expect to receive a rebate check of $2853 in tax year 2007. Two children will earn a check in the amount of $4716. Also, if you are a low-income tax payer and do owe some tax, your tax burden can also be reduced to zero by the amount of these rebates. If your tax burden is below the amount, you will get a check for the difference. For example, if you have one child and you owe $1000 in taxes, the applied EITC will set your tax to zero and you will receive a check in the amount of $1853.
The Obama plan adds a bunch of new EITC's to the tax laws. First, he adds a basic $500 EITC deduction for singles ($1000 for married) in something that he calls "Make Work Pay". (It should probably be called "Make Joe Pay" or as Obama originally told Joe: "We need to spread the wealth around.") This deduction will be available to anyone making less than $75,000 ($150,000 married), so Joe will never have a shot at getting his money back since he's upward of $250,000.
If you've got a kid going to college, expect a $4,000 annual EITC check from Barack. 10 percent of your mortgage can be rebateable. If you're low income and manage to save a buck or two, Barack will give you a check for 50% of you savings up to $1000 (I really don't know how the IRS is supposed to keep track of this; but, it's in Barack's plan anyway). If you have kids and only get to see them on weekends, Barack will give you an $1,110 check if you pay child support. No kids? Don't worry, he'll give you another $555....Now back to having kids... Barack will give you 50% on your child care expenses; not to exceed a rebate of $3,000. Finally, if you are single and make less than $75,000 ($150,000 married) and want to buy an Obama-certified "clean" car, you can get a check for up to $7,000 (My guess is that not too many low income families will turn in their old heaps to buy a new car so Barack can save the planet) .
(Please note: Obama is able to claim these rebate checks as tax deductions because he's calculating them as an offset to the FICA taxes that every worker pays. This way, he can claim a tax reduction for 95 percent of working Americans. This is a sham because FICA and income taxes are two separate things. But, the average low-income worker won't care. They will see that Obama either reduced or eliminated the overall amount of their income that they gave to the government. Slick (or slimy) isn't it!)
The thing I like about Obama's plan is that even a non-taxed drug dealer can get paid by our government. All he or she has to do is come up with a few hours of legitimate pay and have some taxes withheld. Then, they can file a 1040 "Obama" and take advantage of all that social gravy. If he or she (the drug dealer) has two kids and buys a new "clean car" and takes out a mortgage on a 5,000 square foot crib, they could expect Uncle Sam to give them $4716 for having the kids; plus $1000 for just being married and not paying taxes due to their illegal activities; plus $3000 in child care credit while they were out "selling"; plus $7,000 for their new car; $1,000 for putting a lot of their drug money in the bank; and, another $6000 dollars for their 5,000 square foot crib (assuming 10% of their $5000/month mortgage payments). For not really working, the government could cough up a total of $22,716 to our fictitious drug dealing family. Of course, many on the left would say that this couldn't really happen. Like people don't already defraud our government! To some degree, many enterprising people will figure out how to work this system of Obama-give-aways. Just as they have figured out how to cheat every other form of welfare and social programs that our government comes up with. Medicare and Social Security are just riddled with fraud and this tax system won't be any different. Just mark my words.
Besides the cheating, you can expect that Mr. Obama's tax plan will just keep a lot of tax attorneys and tax accountants busy finding ways to dodge his new taxes. With over 27,000 pages of tax code, there is an endless supply of loop-holes. In Joe's case, above, the whole amount of increased taxes ($30,292) could be eliminated by simply buying a dollar's worth of stuff for his plumbing business to reduce his income. That could be a box of pencils. It could even be a dollar more of charitable giving. And, believe me, the tax accountants will find the ways to keep businesses, like Joe's, from paying any more in taxes than they should.
Mr. Obama's tax plan will just make taxes more complicated than it already is. He's using it for the votes and he will implement it for his re-election and for the future election of any Democrat. However, once you start giving money away, as in this tax plan, you can never take that benefit away. If, as an affluent society, we can afford to do this kind of thing then, so be it. But if the economy turns sour (as it may next year), the number of tax paying Americans will be reduced by slower business activity and unemployment. This kind of program then becomes an ever increasing burden because the tax receipts will just keep going down, and the number of low-incomed families, eligible for an Obama tax rebate, will keep increasing.
In my view, this is a ridiculous plan that will only expand our deficit. Something that Obama claims he is committed to reduce. I'll believe that when I see it. The reality of Obama's tax plan is that it is a new form of welfare. It is a "Robin Hood Like" rejiggering of society. It is socialism; plain and simple. It is a redistribution of wealth on a grand scale. It penalizes those who work hard, and, in many cases, it rewards those who didn't commit themselves to either getting an education or working hard. In some cases, it may actually pay people for not working; as was the case of the welfare system that had to be eliminated over 12 years ago. That's why Joe "The Plumber" is really mad about Barack Obama's tax plan.
First, any "Joe the Plumber" (or "Josephine the Plumber", for that matter) that makes $249,999 will pay $12,750 in FICA taxes (also known as the payroll tax or the Social Security tax). If Joe happens to be unfortunate enough to make just a dollar more and fit into Obama's "rich" category by making $250,000, that FICA tax, the tax that is taken out of your pay before you even see your paycheck, will jump from a deduction of $12,750 to the new burden of $31,250. If Joe is a self-employed plumber making $250,000, you can add an additional 2.9 percent to that tax bill in the form of a self-employment tax for FICA and Medicare. Therefore, for that mere extra dollar in pay, Joe will immediately see a jump in their FICA taxes by $18,500; or, $22,792 if self-employed or a small business owner. And, for every additional dollar income, thereafter, you will be hit with an additional 12-1/2 percent in FICA taxation and another 2.9 percent in self-employed Medicare taxation (if applicable). That big "jump" in taxes is because Mr. Obama has intentionally, and very politically, left a "donut hole" in his proposed FICA tax tables so he can continue to make the claim that 95 percent of the people making under $250,000 will get a tax cut under his plan.
Currently, there is a tax ceiling of $102,000 on FICA. All incomes after that level pay no additional taxes for that purpose. Logic says that if you need to shore up the Social Security system, you should raise that ceiling; a practice that has been in effect for many years. However, if you are running for President and you want to have a slogan that says you will reduce taxes for anyone making under $250,000 (or 95 percent of tax payers), you can't raise that ceiling. To do that would only raise taxes on people who are currently making over $102,000 but, below $250,000. So, what do you do? Well, you play a game. You leave the tax in place for incomes up to $102,000. Then, you start the tax up again for any income levels above $250,000. This leaves a taxation hole or "donut hole" on the FICA tax from $102,000 to $250,000; and, it keeps your campaign slogan in tact. This is just one of the many "shady" games that Obama has been playing in order to get elected. He never does anything without thoroughly thinking through the political consequence of doing it. Being fair or truly logical never really enters into his equation.
So much for FICA. Now, lets focus on the effect of the new tax tables under Obama and how that would effect Joe if he makes $249,999 or just a dollar more at $250,000. If Joe is single, there would hardly be any difference in the tax at $249,999 or at $250,000. However, if married, Joe would see a jump in taxes. At $249,999, the married filing-jointly taxpayer would be hit with a 33 percent tax rate. For a dollar more, the tax rate jumps to 36 percent. Now married...Joe would have a tax bill of $82,500 for his salary of $249,999. If he makes a dollar more, his bill will jump to $90,000 for an increase of $7,500.
In addition, if Joe happens to invest his income in the stock market for his retirement years, Mr. Obama's plan will go after him with even more taxes. That's because Obama will raise the capital gains tax from 15 percent to 20 percent for all taxpayers making above $200,000 or, $250,000 for those married and filing jointly. Certainly, the application of this tax would be outside of any tax-free investment fund like an I.R.A. account that our "plumber" could be involved with. But, have no fear, when Joe starts pulling his money out of his previously tax-free IRA Account, the Tax Man, Obama, will be there waiting for him.
To recap, assuming our "plumber" is married and self-employed, the increased tax penalty of making $250,000 versus $249,999 under Obama is about $30,292. Quite the penalty for simply making a buck more than $249,999. Quite the penalty for being successful. A penalty that could easily put off expanding his business by hiring additional people at some later date. And that's the crux of raising taxes on a business like Joe's (or Josephine's).
Not included in this number (because I don't know what percs his business currently offers) is Obama's plans for healthcare. If our plumber's business doesn't currently provide any health insurance, it will certainly have to provide it under an Obama Administration. Depending on how many employees he has, it could easily cost our plumber more than $2500 a year per employee; assuming a 50 percent tax credit for any "employer provided healthcare" costs under Obama's plan.
Barack and his team would argue that "Joe" would get all kinds of small business tax breaks under his plan. Sure, if he hired another plumber at, say, $42,000 a year (the average minimum journeyman plumber's salary in America), the Obama plan would give him a small incentive deduction on his income tax. But, that credit would hardly offset his original increased taxes of $30,292 and the cost of his new employee with health insurance. If he still did it, he would be down over $70,000 from the current Bush system of taxation.
Obama's tax plan gives billions to those who don't pay tax. I really believe Joe the Plumber (who's full name is Samuel Joseph Wurzelbacher) is madder about that. Under an Obama administration, he will remove 15 million more low-income people from the tax rolls. This is above the 20 million more low-income people that the Bush's tax-cuts-for-the-rich system saved from paying taxes. And, that was over the Clinton Administration's 30 million who were dropped from paying taxes. When it's all said and done, it is expected that more than 55 million working Americans won't pay taxes. but, Obama's plan doesn't just stop at that. He will take the EITC (Earned Income Tax Credit) to new heights.
Currently, under the guise of the EITC, low-income tax filers who wind up paying no tax will actually receive a check from the IRS/U.S. Treasury if they have children. For having one child, a low income worker can expect to receive a rebate check of $2853 in tax year 2007. Two children will earn a check in the amount of $4716. Also, if you are a low-income tax payer and do owe some tax, your tax burden can also be reduced to zero by the amount of these rebates. If your tax burden is below the amount, you will get a check for the difference. For example, if you have one child and you owe $1000 in taxes, the applied EITC will set your tax to zero and you will receive a check in the amount of $1853.
The Obama plan adds a bunch of new EITC's to the tax laws. First, he adds a basic $500 EITC deduction for singles ($1000 for married) in something that he calls "Make Work Pay". (It should probably be called "Make Joe Pay" or as Obama originally told Joe: "We need to spread the wealth around.") This deduction will be available to anyone making less than $75,000 ($150,000 married), so Joe will never have a shot at getting his money back since he's upward of $250,000.
If you've got a kid going to college, expect a $4,000 annual EITC check from Barack. 10 percent of your mortgage can be rebateable. If you're low income and manage to save a buck or two, Barack will give you a check for 50% of you savings up to $1000 (I really don't know how the IRS is supposed to keep track of this; but, it's in Barack's plan anyway). If you have kids and only get to see them on weekends, Barack will give you an $1,110 check if you pay child support. No kids? Don't worry, he'll give you another $555....Now back to having kids... Barack will give you 50% on your child care expenses; not to exceed a rebate of $3,000. Finally, if you are single and make less than $75,000 ($150,000 married) and want to buy an Obama-certified "clean" car, you can get a check for up to $7,000 (My guess is that not too many low income families will turn in their old heaps to buy a new car so Barack can save the planet) .
(Please note: Obama is able to claim these rebate checks as tax deductions because he's calculating them as an offset to the FICA taxes that every worker pays. This way, he can claim a tax reduction for 95 percent of working Americans. This is a sham because FICA and income taxes are two separate things. But, the average low-income worker won't care. They will see that Obama either reduced or eliminated the overall amount of their income that they gave to the government. Slick (or slimy) isn't it!)
The thing I like about Obama's plan is that even a non-taxed drug dealer can get paid by our government. All he or she has to do is come up with a few hours of legitimate pay and have some taxes withheld. Then, they can file a 1040 "Obama" and take advantage of all that social gravy. If he or she (the drug dealer) has two kids and buys a new "clean car" and takes out a mortgage on a 5,000 square foot crib, they could expect Uncle Sam to give them $4716 for having the kids; plus $1000 for just being married and not paying taxes due to their illegal activities; plus $3000 in child care credit while they were out "selling"; plus $7,000 for their new car; $1,000 for putting a lot of their drug money in the bank; and, another $6000 dollars for their 5,000 square foot crib (assuming 10% of their $5000/month mortgage payments). For not really working, the government could cough up a total of $22,716 to our fictitious drug dealing family. Of course, many on the left would say that this couldn't really happen. Like people don't already defraud our government! To some degree, many enterprising people will figure out how to work this system of Obama-give-aways. Just as they have figured out how to cheat every other form of welfare and social programs that our government comes up with. Medicare and Social Security are just riddled with fraud and this tax system won't be any different. Just mark my words.
Besides the cheating, you can expect that Mr. Obama's tax plan will just keep a lot of tax attorneys and tax accountants busy finding ways to dodge his new taxes. With over 27,000 pages of tax code, there is an endless supply of loop-holes. In Joe's case, above, the whole amount of increased taxes ($30,292) could be eliminated by simply buying a dollar's worth of stuff for his plumbing business to reduce his income. That could be a box of pencils. It could even be a dollar more of charitable giving. And, believe me, the tax accountants will find the ways to keep businesses, like Joe's, from paying any more in taxes than they should.
Mr. Obama's tax plan will just make taxes more complicated than it already is. He's using it for the votes and he will implement it for his re-election and for the future election of any Democrat. However, once you start giving money away, as in this tax plan, you can never take that benefit away. If, as an affluent society, we can afford to do this kind of thing then, so be it. But if the economy turns sour (as it may next year), the number of tax paying Americans will be reduced by slower business activity and unemployment. This kind of program then becomes an ever increasing burden because the tax receipts will just keep going down, and the number of low-incomed families, eligible for an Obama tax rebate, will keep increasing.
In my view, this is a ridiculous plan that will only expand our deficit. Something that Obama claims he is committed to reduce. I'll believe that when I see it. The reality of Obama's tax plan is that it is a new form of welfare. It is a "Robin Hood Like" rejiggering of society. It is socialism; plain and simple. It is a redistribution of wealth on a grand scale. It penalizes those who work hard, and, in many cases, it rewards those who didn't commit themselves to either getting an education or working hard. In some cases, it may actually pay people for not working; as was the case of the welfare system that had to be eliminated over 12 years ago. That's why Joe "The Plumber" is really mad about Barack Obama's tax plan.
Thursday, October 16, 2008
ACORN: It's All About the Numbers
A couple of days ago, Barack Obama and the Obama Campaign team discounted the activities of ACORN as either insignificant or an attempt by the Republicans to suppress the vote. However, Mr. Obama and his team seem to be ignoring the fact that half of the fraud complaints and lawsuits that have been filed against ACORN are from Democratic Secretary's of State and Democratic Attorney's General. Even honest Democrats smell a rat.
Obama, himself, discounted all these activities by questioning whether the personnel in a voter's registration office would actually allow a falsely registered Dallas Cowboy to vote. I have a clue for Mr. Obama. I would seriously doubt that any more than a handful of people working in any voter registration office across this country actually know the names of all the individual players on the Dallas Cowboys. My experience is that most of these workers are older woman. Not hardly your tailgating, beer drinking, Sunday football couch-potatoes that follow pro football.
Further, the vote is counted only after the absentee ballot has been separated from its envelope and the name and credentials of the submitting voter are no longer known. No one will ever be able to go back to see if a fraudulent vote was cast. The time to catch the fake names was at the time of registration when those names were initially entered into the state's database. After that, voter fraud is free to run rampant. In Chicago, the city that Obama comes from and which has a history of fraudulent voting, the standing joke is "vote early and often." Year after year, Chicago's elections are flooded with dead voters. That's the legacy of the first Mayor Daley. One can only wonder if the Obama election team and ACORN are following in the "Daley" tradition.
ACORN actually doesn't really care about the quality of their efforts. It's all about the numbers. The numbers are power. If false voter registrations slip into the system and some people are able to vote more than once; then, so be it. That's just gravy. Beyond that, though, the numbers of new voters being registered is the real meat. First, ACORN doesn't register Republicans. Their whole thrust is to increase the Democratic voter rolls. As a special interest group, this gives them control over Democrats. That's the real power they seek. The power to influence policy. They know that, to a politician, increasing the base of voters is often more important than any campaign contributions. It means you don't have to spend a dime to get that vote.
The other thing that happens when one political party has more registrations than another is that it skews the polling. Pollsters like Gallup, Rasmussen, Zogby, etc. give mathematical "weighting" to their results based on the percentage of registered Democrats versus the percentage of registered Republicans and Independents. This partially explains the wide variance you find in the polls being released right now. For example, in the last two days, CBS/New York Times has Obama leading by 14 points; while, one of Gallup's polls has Obama's lead down to 3 points. Actually, skewing the polls can be a real form of voter suppression. That's because it can cause depressed support for the weaker candidate who is behind in the polls; resulting in a lower turnout for that person. Also, undecideds and independents can be influenced by big poll numbers for one candidate over another. That's when the psychological impact of "backing the winner" takes over. Nobody really wants to ever back a loser. Polls can "push" the vote to the candidate who is more popular in the polls.
I personally don't think that "walk around" or door-to-door registrations, like those conducted by ACORN, should be allowed. It just lends itself to fraud. A person registering to vote should do so before a duly appointed registration official who has full access to verification data. That's how I registered and how 99 percent of voters register in this country. If ACORN or anyone else wants to get involved in voter registration efforts, they should do so by busing or providing some kind of transport to an authorized registration office, or work to establish remotely setup and authorized registration locations. When you hear that ACORN hires felons and those convicted of identity fraud, you really have to question what is going on. In the case of ACORN, you have to wonder if they have crossed the line into subversive activity.
As always, just my opinion.
Obama, himself, discounted all these activities by questioning whether the personnel in a voter's registration office would actually allow a falsely registered Dallas Cowboy to vote. I have a clue for Mr. Obama. I would seriously doubt that any more than a handful of people working in any voter registration office across this country actually know the names of all the individual players on the Dallas Cowboys. My experience is that most of these workers are older woman. Not hardly your tailgating, beer drinking, Sunday football couch-potatoes that follow pro football.
Further, the vote is counted only after the absentee ballot has been separated from its envelope and the name and credentials of the submitting voter are no longer known. No one will ever be able to go back to see if a fraudulent vote was cast. The time to catch the fake names was at the time of registration when those names were initially entered into the state's database. After that, voter fraud is free to run rampant. In Chicago, the city that Obama comes from and which has a history of fraudulent voting, the standing joke is "vote early and often." Year after year, Chicago's elections are flooded with dead voters. That's the legacy of the first Mayor Daley. One can only wonder if the Obama election team and ACORN are following in the "Daley" tradition.
ACORN actually doesn't really care about the quality of their efforts. It's all about the numbers. The numbers are power. If false voter registrations slip into the system and some people are able to vote more than once; then, so be it. That's just gravy. Beyond that, though, the numbers of new voters being registered is the real meat. First, ACORN doesn't register Republicans. Their whole thrust is to increase the Democratic voter rolls. As a special interest group, this gives them control over Democrats. That's the real power they seek. The power to influence policy. They know that, to a politician, increasing the base of voters is often more important than any campaign contributions. It means you don't have to spend a dime to get that vote.
The other thing that happens when one political party has more registrations than another is that it skews the polling. Pollsters like Gallup, Rasmussen, Zogby, etc. give mathematical "weighting" to their results based on the percentage of registered Democrats versus the percentage of registered Republicans and Independents. This partially explains the wide variance you find in the polls being released right now. For example, in the last two days, CBS/New York Times has Obama leading by 14 points; while, one of Gallup's polls has Obama's lead down to 3 points. Actually, skewing the polls can be a real form of voter suppression. That's because it can cause depressed support for the weaker candidate who is behind in the polls; resulting in a lower turnout for that person. Also, undecideds and independents can be influenced by big poll numbers for one candidate over another. That's when the psychological impact of "backing the winner" takes over. Nobody really wants to ever back a loser. Polls can "push" the vote to the candidate who is more popular in the polls.
I personally don't think that "walk around" or door-to-door registrations, like those conducted by ACORN, should be allowed. It just lends itself to fraud. A person registering to vote should do so before a duly appointed registration official who has full access to verification data. That's how I registered and how 99 percent of voters register in this country. If ACORN or anyone else wants to get involved in voter registration efforts, they should do so by busing or providing some kind of transport to an authorized registration office, or work to establish remotely setup and authorized registration locations. When you hear that ACORN hires felons and those convicted of identity fraud, you really have to question what is going on. In the case of ACORN, you have to wonder if they have crossed the line into subversive activity.
As always, just my opinion.
Wednesday, October 15, 2008
Can Capitalism Survive?
Throughout the history of this country, it has been capitalism and not socialism that has made our country strong. We won the Cold War because socialism/communism in Soviet Russia couldn't divert billions of dollars in military spending and still provide for the everyday needs of its citizens. The broad-based, higher standard of living in this country is one of the reasons that so many flood into America as both legal and illegal immigrants. It's the promise of America, the American Dream, and our "American Way" that those who come here seek.
Sadly, we may be on the verge of changing all that. Could this be the "change" that Barack Obama has in store for us?
There is a video that has been circulating on the Internet that clearly shows Barack Obama telling a supporter (a plumber by profession) that we need to "spread the wealth around" (See video). At the same time, Hillary Clinton said last year they she wants to "take the profits from the oil companies" (See Video). Then there was this prophetic comment by Maxine Waters in the umteenth grilling of our oil company executives (See Full Story). Please take note that Ms. Waters clearly caught herself from saying the word "socialize" in her comments. However, the socialization of the oil industry was clearly on her mind. Once it happens with one industry; those who are socialists will attempt to attack every other industry that they have some gripe with. That gripe might be low pay or non-union organization. Too much profit. Too global. Too eco-dirty. And, the list can go on for ever; if you are a socialist.
Those three video clips demonstrate a widespread attitude in the Democratic party. Make no mistake about it, if Barack Obama is elected, we will have a socialistic President and probably the farthest left and most socialistic Congress in the history of this country. I think we should brace ourselves for the impact of that fact. In many ways, capitalism may not survive. Some of the freedoms of this Democracy may not survive. That's because some aspects of Democracy, like full and complete freedom of speech, can hurt the socialist movement and cause. The reward of this government will "not" be to those who contribute the most to the economic success in this country. Instead, this government's focus will be on those on the lower economic and educational scale. Forget personal responsibility. That's the main thrust of a socialist government. It is a belief that capitalism is an evil that suppresses the poor and only enhances and benefits the rich. But, those who believe this to be the case seem to forget how many people in this country, who have started with literally nothing, have built tremendous businesses and have done very well. No other country or system of government can boast of as many success stories. Socialism, in its purest forms, only results in the complete stifling of human ambition and only creates unfulfilled needs in society.
While we were enjoying 5 percent unemployment in 2005, the French, for example, had over 10 percent unemployment and were having riots in the streets and seeing the nightly burning of cars. This was coming from people whose needs of food, clothing, and shelter were clearly being taken care of by the state. But, the system forgot the human spirit and overriding need to accomplish something in life. Not just "suckle" off their government. While you never hear about it to the extent that it occurred in 2005, the nightly burning of cars and mini-riots occur every night in Paris (See Full Story). The welfare system in this country was killed by the Republicans and the Clinton Administration for that very reason. People on welfare lived in it and were locked into it from birth to death. When welfare was finally dissolved 12 years ago, the disasters that the "socialists of the Democratic Party" predicted never happened. Many of the housing projects that grew out of Lyndon Johnson's Great Society were deemed to be failures and have since been abandoned due to the levels of crime and filth.
Now, Barack Obama wants to revive that system by using our tax system to do it. He would accomplish this through the Earned Income Tax Credit (EITC). The EITC would give money to those who don't pay taxes and, in many cases, those who don't even work. In fact, a non-working, drug dealer could collect thousands of dollars in EITC rebate checks from our government under Obama's plan.
The worst thing that could have ever have happened, especially at this juncture in our history, is the credit crisis. This crisis will provide "cover" for the socialists of our Democratic-controlled government to do all those anti-capitalistic things they have always wanted to do. They will blame capitalism and not their own socialist meddling in low income mortgages for the rationale behind changing the way business is done in this country. Even our current pro-capitalist President and Treasury Secretary are now in the process of partially nationalizing our banking system (See Full Story). I really question whether or not our system of capitalism can survive under a Barack/Reid/Pelosi government. We'll just have to wait and see.
Sadly, we may be on the verge of changing all that. Could this be the "change" that Barack Obama has in store for us?
There is a video that has been circulating on the Internet that clearly shows Barack Obama telling a supporter (a plumber by profession) that we need to "spread the wealth around" (See video). At the same time, Hillary Clinton said last year they she wants to "take the profits from the oil companies" (See Video). Then there was this prophetic comment by Maxine Waters in the umteenth grilling of our oil company executives (See Full Story). Please take note that Ms. Waters clearly caught herself from saying the word "socialize" in her comments. However, the socialization of the oil industry was clearly on her mind. Once it happens with one industry; those who are socialists will attempt to attack every other industry that they have some gripe with. That gripe might be low pay or non-union organization. Too much profit. Too global. Too eco-dirty. And, the list can go on for ever; if you are a socialist.
Those three video clips demonstrate a widespread attitude in the Democratic party. Make no mistake about it, if Barack Obama is elected, we will have a socialistic President and probably the farthest left and most socialistic Congress in the history of this country. I think we should brace ourselves for the impact of that fact. In many ways, capitalism may not survive. Some of the freedoms of this Democracy may not survive. That's because some aspects of Democracy, like full and complete freedom of speech, can hurt the socialist movement and cause. The reward of this government will "not" be to those who contribute the most to the economic success in this country. Instead, this government's focus will be on those on the lower economic and educational scale. Forget personal responsibility. That's the main thrust of a socialist government. It is a belief that capitalism is an evil that suppresses the poor and only enhances and benefits the rich. But, those who believe this to be the case seem to forget how many people in this country, who have started with literally nothing, have built tremendous businesses and have done very well. No other country or system of government can boast of as many success stories. Socialism, in its purest forms, only results in the complete stifling of human ambition and only creates unfulfilled needs in society.
While we were enjoying 5 percent unemployment in 2005, the French, for example, had over 10 percent unemployment and were having riots in the streets and seeing the nightly burning of cars. This was coming from people whose needs of food, clothing, and shelter were clearly being taken care of by the state. But, the system forgot the human spirit and overriding need to accomplish something in life. Not just "suckle" off their government. While you never hear about it to the extent that it occurred in 2005, the nightly burning of cars and mini-riots occur every night in Paris (See Full Story). The welfare system in this country was killed by the Republicans and the Clinton Administration for that very reason. People on welfare lived in it and were locked into it from birth to death. When welfare was finally dissolved 12 years ago, the disasters that the "socialists of the Democratic Party" predicted never happened. Many of the housing projects that grew out of Lyndon Johnson's Great Society were deemed to be failures and have since been abandoned due to the levels of crime and filth.
Now, Barack Obama wants to revive that system by using our tax system to do it. He would accomplish this through the Earned Income Tax Credit (EITC). The EITC would give money to those who don't pay taxes and, in many cases, those who don't even work. In fact, a non-working, drug dealer could collect thousands of dollars in EITC rebate checks from our government under Obama's plan.
The worst thing that could have ever have happened, especially at this juncture in our history, is the credit crisis. This crisis will provide "cover" for the socialists of our Democratic-controlled government to do all those anti-capitalistic things they have always wanted to do. They will blame capitalism and not their own socialist meddling in low income mortgages for the rationale behind changing the way business is done in this country. Even our current pro-capitalist President and Treasury Secretary are now in the process of partially nationalizing our banking system (See Full Story). I really question whether or not our system of capitalism can survive under a Barack/Reid/Pelosi government. We'll just have to wait and see.
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