Archive for March, 2009

While every one from the President on down was outraged about the AIG $165 million dollar bonus payouts, something much much bigger was going on. No one was talking about the $1 trillion dollars the U.S. government printed yesterday out of thin air to help stave off a depression. It seems the Federal Reserve pumped $1 trillion dollars in the economy on Wednesday. One Trillion we don’t have, and the Chinese government isn’t backing us on this one, so it’s really just printing some money with a big IOU to ourselves. What this does is devalues our Dollar because there is nothing to back it up. No gold, no other country buying the debt, they just added $1 trillion to the money supply in hopes of keeping us out of a depression. I know this because it was reported on the Glen Beck show on Fox News today. He said the AIG outrage was just a big smokescreen to hide that this was going on.
Glenn Beck reports on Fed Reserve action
No one else reported on it. and he is right. I watched CNBC, NBC, ABC, CNN today and non of them even mentioned it. Being disabled I get to watch a lot of TV and I watch mostly news, and lately a lot of financial news. Everyone is still totally talking about the AIG bonuses, but no one mentioned this. I taped the President on Leno tonight and haven’t watched it, but I’m sure he didn’t talk about it. Why this is very important is this. This was tried by several other countries before who were in dire financial straights. And it has never in the the history of history worked. What it does do when it fails is cause hyperinflation. It totally devalues the dollar to the point where you could have a $100 loaf of bread. Some of the countries that tried and failed this technique are Germany between WW1 and WWII, and more recently Argentina and Brazil. In Germany people had to literally use wheel barrows full of money to buy groceries.

Fed pumps $1 trillion in economy NY Times

Hyperinflation Wikipedia

No one mentioned that we were going to do this, they didn’t ask the publics opinion. In fact not even Congress was involved. It was an action by the Federal Reserve. The Fed did this in hopes of jump starting the economy. They have no other tools left to use. Normally the Federal Reserve lowers the Prime Lending Interest Rate to help the economy, but it’s already been lowered to between 0 and .25%. There was nowhere else to go with it. So this was their last desperate act. For all of our sakes I hope it works, but history shows it probably won’t. The government wants us to spend to help get the economy going. For years it was pointed out that the population of the United States was one of the worst savers in the whole world. But since this latest financial crises we are now saving like never before. Now we are being told we are hurting the economy by doing the right thing and saving. We should be saving, what got us into the current crises is by buying much more than we could really afford and doing it all on credit. I say the best you can do at this point is save all you possibly can, and prepare for the worst. If it gets as bad as some experts say it will, you may be the only one on your block who can afford that loaf of bread. What do you think ? Spiney

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Excuse the language but if I’m going to blog, I may as well speak what I feel.  I watched the news today and saw Speaker Pelosi as she spoke to a group of mostly illegal immigrants in San Francisco .  She told them that it is un-American for us to enforce the immigration laws. That she was working to get these laws which try to deport illegal immigrants overturned.  We have immigration officers who do a thankless job upholding the laws. They are in danger patrolling the border, often get shot at by drug runners trying to cross the border. And here the Speaker of the House, Nancy Pelosi is out undermining the work they do. She told the gathering of immigrants that they are patriotic by taking the time to gather and hear her. They are the Patriots, not the officers who risk their lives to serve and protect us. Ever since 9/11/2001 protecting our borders has become some much more important. Now either we have laws and we are going to enforce them, or not. We give lip service to enforcing our border policies, but that’s it.  I’m sorry but who voted Nancy Pelosi President? It seems as Speaker of the House of the now dominant Democratic party she has more power than the person we did vote in as President, Barack Obama.  What do you think? Spiney

Foxnews story: Pelosi talks to Illegal Immigrants

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I listened today to CNN’s State of the Union with John King. He was interviewing Budget Director Peter Orszag. He asked him repeatedly why a president who campaigned on promises of not doing things the way they’ve always been done in Washington and promised to eliminate earmark spending projects would sign a budget bill with over 8000 earmarks in it. Director Orszag said that there will be no earmarks in the 2010 budget but it was too late to cut out the earmarks in the 2009 budget. This budget to be fair has earmarks from both parties, but the budget was approved by a majority Democratic congress. When you have a Democratic President who was elected in pretty much a landslide on promises of Change and a Democratically controlled congress, why can’t he have what he wants. He would win over his detractors and show the average taxpayer that while they have to cut back in the tough economic times, so does the government. He should say I will not sign this bill until the most ridiculous earmarks are removed. That would show real change and real leadership. I urge you to go over to the CNN site and watch the video from this interview. It was revealing. I applaud CNN’s John King for continually asking the question, trying to get a straight answer from director Orszag.

Personally what I think is that while most people voted for Barack Obama for President what we really got was President Pelosi. What do you think? Spiney

Please view the CNN story here:  http://preview.tinyurl.com/dx4vnb

I apologize, I tried everything I could but I could not get the above referenced link to come up as a blue line link. The path is correct you will need to cut and paste it into your browser. Sorry, Spiney

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I listened to an economist the other day on a business news channel who said that basically the prosperity of the last decade was all a lie.  A lie built on credit. People borrowed money they didn’t have to buy houses and cars and stock they really couldn’t afford.  This happened with corporations and investors too who bought stock, that made the stock market rise. They saw the stock market and the real estate markets as an ever growing thing where you couldn’t lose. The only way you lost was if you weren’t in the game. So you borrowed to buy more. It was a  No Brainer borrow at 7% to buy into a market that was going up 10-12% a year.  And the real estate market in some areas was going up 20% a year.  But then when the credit market tightened up and you could no longer get easy credit, it all came falling in.  People who got loans just because they had a pulse and said they had good jobs, maybe they did, but in many cases they overstated their income, started to default on their loans.  All during this time you had average citizens who wanted to catch up with the Jonses, fast. It may have took their neighbors 4-6 years in college and hard work to get where they were.  Or their parents many decades of sacrifice to have the nice home in the suburbs.  But why wait with EZ credit you could have it now.  And why stop at one home, how nice it would be to have a rental property or a vacation home at the shore or the mountains, just sign here, maybe take a second mortgage out on that home you bought 2 years ago with 0-5% down.  If you couldn’t afford a vacation home then at least a Time Share. You know the one where you took the free 3 day vacation and they wore you down into buying a time share.  Seemed like a great idea then didn’t it.  And hey having a decent car isn’t good enough, you need some real wheels, a BMW, Hummer, or at least a Caddy. don’t have the down payment on that new or second car, no problem, you can Lease it. Just don’t drive more than 12,000 miles a year or scratch and dirty it.  While your at it throw in a motorcycle, or a boat.  And the kids, they got to have what every other kid has.  The latest PS3, a Cell Phone with all the bells and whistles by age 10 and not just an mp3 player that would be embarrassing, it has to be an Ipod. The whole family can have cell phones just sign up for the family plan and get 5 free phones, just pay the big monthly fee.  The big games coming up, have a TV under 30″, that’s just too hard on the eyes. To really enjoy the game and life in my house in the burbs I need to have at least 50″ plasma. No money no problem, no payments for 12 months or go down to Rent-a-Center only $35 a week.  And while your at it for just $10K in easy installments you can have perfect breasts and pearly white teeth.  Why not I’ve got a wallet full of credit cards.  The majority of people lived way beyond their means.  But they had all the toys.

They say we may recover back to were we were in about 3-5 years. Personally I hope we never get back there. I hope that this time has the effect on our generation that the depression and WWII had on our grandparents and parents. What I mean by that is that we get a new respect for saving, for getting by with less, and for using cash, not credit to get what we need and want.  To realize there is no shame in driving a car more than 3 years old, or renting a home. I’ve driven used cars the majority of my life, and also rented homes and apartments the majority of my life.  Yes I have owned a home, bought 2 new cars, and made the big mistake of leasing a new Saab. I can tell you there is something to be said about not having a car payment every month or being a renter. The nice thing when you rent is when the roof leaks or the heater fails you call the landlord, not the repairman. Helps you to sleep at night.  Spiney

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Today the Dow drop to it’s lowest point since 1997 at 6763 down 299 points in one day.  The Dow Jones Industrial has gone down almost 24% since President Obama was inaugurated. Now I’m not saying it went down because he was inaugurated. It has gone down because of the spending policies of Congress and the Obama administration. And let’s give him the benefit of the doubt and say it’s not because of the wild spending and bailouts. Now is not the time to initiate the largest spending bills, new programs,raise taxes, and totally overhaul the health care system while every single day the economy gets worse. Where will the money come from to implement these programs when we will soon have double digit unemployment? The Obama administration wants to punish Wall Street for it’s greed and misdeeds.  But in doing this they also hurt the average American myself included who either have investments or 401k’s that are tied to the success or failure of Wall Street. This especially hurts those who are retired and had their life savings invested for their future. Many have seen their savings cut in 1/2.  And many who worked very hard and thought they could enjoy their golden years are now forced to go back to work. Notice when you go to the grocery store how many senior citizens are now working as baggers and check out persons.  President Obama was elected to give us change. If he gets his way with all of the new programs and expenditures he wants, the change in the basket on your dresser may be all the change you get.  Tell me what you think.  Thanks for stopping by.  Spiney

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