Tag Archives: Economy


When an economy needs a little boost, the lowering of interest rates spurs consumer big ticket buying and encourages businesses to expand by lowering the cost of anything that is financed.  However, with short term interest rates already near zero, this tool is no longer in the Federal Reserve’s toolbox.  So Bernanke’s move is to lower long term rates in the hope that that will encourage companies to expand and consumers to increase their purchases of automobiles and homes. That’s the Bernanke Twist.

Tell me, with short term rates near zero and long term rates at 1.94%, the lowest in more than a half century, how much more likely is it you will buy a car if long rates go from 1.9 percent to perhaps 1.7 percent?  How much more likely is it the owner of the tire store in your neighborhood will open another outlet now that he can borrow for a few pennies less?  None. 

Corporations are not lacking money.  Consumers are not holding back because of interest rates.  The Fed is pushing on a string — again.  It is not the cost of money or the lack of money in the system that is holding back a recovery.  It’s executive government policy that’s crippling the economy.  The tire shop owner may be ready and anxious to open another store, but first he must know how much it will cost to take on the new employees.  He also needs to know what the latest regulations are and how much it will cost to comply with them.  But none of this is knowable given the complexities of Obamacare and the vagueness written into many of the new laws.  So we sit.

What this country needs is not a good 5 cent cigar or lower interest rates.  What this country needs is a presidential election year.  Let’s hope the voters don’t make the same mistake twice.


If you hire a demolition expert you should not be surprised when the building collapses.

A community organizer knows nothing about building the wealth of a nation, only about how to appropriate wealth that has already been created.  The process is a destructive one.  That’s obvious.

In 2007 there was an economic meltdown due to excessive issuance of sub-prime mortgages.  ACORN was in the forefront of the activist community pressuring banks and regulators to make more and more of these loans until the inevitable collapse.  To fix it we hired an ACORN trainer.

You can hire an arsonist to put out a fire if you wish.  But don’t expect his heart to be in it.


Paul Krugman never ceases to amaze. He acknowledges the economic mess we are in but seems to be unaware of who has been in control of the White House and the Congress in recent years. Here’s what he had to say yesterday about present conditions.

A few readers have asked what I make of recent economic indicators. The answer is, nothing good.

By my count we’ve had four adverse surprises lately: GDP, private-sector payrolls, service-sector survey, and new claims for unemployment insurance. Since there seem to be a fair number of Charlie Browns out there — people who keep expecting a housing recovery, even though Lucy keeps pulling away the football — I guess we should add weak housing numbers to the mix.

It looks like a sputter, not a crash, but it’s definitely not good.

Dear reader, you and I know the Democrats have controlled both the House and the Senate since January 2007. Even Krugman must know who has been in control of the Executive Branch for the last two plus years. With Democrats remaining in control of the Senate and the presidential specter of veto, Republicans have been unable to put any real plans into law in the 4 short months since they won the House. So Paul, how is it you see that it’s the Republicans who got us where we are when the Democrats have been driving the bus?


George Soros says dig deeper. Watch the brief video here.

He recommends more government spending to bolster a fragile recovering economy. ‘But don’t spend it on consumption’ he says, “spend it on infrastructure.”

But broad based consumption is very the heart of of a strong economy. Infrastructure is just one industry and a union dominated one at that. Soros is talking about Barack’s bridges and roads. Government owns the bridges and roads. Old George is calling for bigger government and greater debt as a way to strengthen the economy. Perhaps he believes that old adage that if you dig deep enough you will come out in China.

I happen to believe Soros is an honorable man. But he grew up in a Communist country and still buys the idea that socialism is the best system, if you can just get leaders to do it right. How can a smart man like Soros be so wrong? For one thing, great wealth, like great fame, is an isolater. It separates you from the rest of the world. Add the guilt many feel for having the wealth and you have reasons enough to see why a good man can be so wrong.


Fat finger Freddie freed from fault

All it took was a trillion dollars worth of Euros. We said it would happen…this time. It happened…this time. The bailout will likely bring about 10 years of relative peace, or call it 3 election cycles. During this period we will find out if the close call put the fear of God in the minds of European voters or if they will continue with their socialistically modified form of capitalism.

On May 7th we wrote regarding the market gyrations, “the word is, that someone at Citigroup placed an order to sell Proctor and Gamble and hit the B key instead of the M key”. Indeed, that was the word at the time. The fat finger theory has faded, to be replaced by a big question mark. Nobody knows, so let’s speculate.

It was an act of inhumanity. Once upon a time human beings decided which stocks to buy or sell and at what price. This is no longer the practice except by a few elderly people who probably don’t have cell phones yet either. Today humans set strategy, and then delegate the details to computers to carry out the strategy. To paraphrase a well known cliché, “computers do, or crash and die, but never reason why”. Computerization, which I am calling inhumanity, is rampant on both sides of the street as well as in the middle of the pavement itself. By that I mean the buying community, the selling community and the exchange are all programmed to leave it to an Intel processor to handle the actual trading.

There was a great deal of nervousness milling about, stocks had run up too fast, Greece was scaring everyone, etc. So the strategists drew lines in the sand and told their computers to take immediate action if the lines were crossed. Normal procedure, but this time there was more uniformity of opinion among the players as to where to put the line and it was a tight line. Triggers triggered triggers and down she went, faster than humans could figure out why.

That’s my speculation. It remains, as usual, for Congress to investigate and deliver the final word so that we need speculate no more.

Bob B

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In the future this feature will be titled LAST WEEK. The old title was a bit too restrictive.

Week ending May 7, 2010
Obama reveals the size of our nuclear stockpile to our enemies.
Obama, as our President, sits in for us in the world wide poker game played between sovereign nations. It is a game of life and death. Our leader chooses to show his hand for all the world to see. We need a new leader.

Bloomberg to Couric – Times Square bomber may have been Obamacare protester
We all know better now. Hizzoner should have known better then.

Schwarzenegger ends his support for offshore oil drilling
I told you. He isn’t a Republican.

Osama bin Laden is in Washington, D.C.
Ahmadinejad said so, and he ought to know. He was kidding, of course. (???)

Bob Woodward is doing Barack Obama
This one is guaranteed to be a best seller. Scheduled for September release.

Yahoo News reports “Congress makes too many vague laws.”
If Yahoo thinks that’s news, it explains why their name is Yahoo.

Al Sharpton speaks for Karl Marx
“No Social Justice Until Everything ‘Equal in Everybody’s House’.”
I presume anyone owning two cars is going to have to give one of them to someone who has no car. It’s the only path to justice, especially of the other person won’t work and save to earn one.

Unemployment comes in at 9.9% or 17.1% depending on how you look at it
If Obama wants to replicate Franklin Roosevelt he has to get higher numbers than that. FDR got the official number up to 23.2% after being in office for two years. To be fair, he had a head start. They were 18% when he took office. But he did hold them up very well. Unemployment was still 17.4% at the end of his sixth year.

Bob B

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For facts and graphs that will blow you away (the HuffPo will probably charge me with inciting violence with that cliché) you have to go to A Goy and His Blog. Here is but a sample of his work. This Goy has done a great service. Paul Ryan move over, here comes the Goy.
I apologize for the size, but you can click it to enlarge. My webmaster is a lazy cat named Loosey and, like the government , is no help at all.

There is much more on this blog site. Do not fail to take a look.

Bob B

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