You may have noticed that there is a wave of angry voters out there. If you are in danger of losing your job, you may believe it's unfair; that your voting record demonstrates you are not part of the problem. I believe many of you still don't understand what all the fuss is about. Let me try to clarify.
The frustrated masses are not just Tea Party members. There are also frustrated individuals who prefer not to march under anyone's banner (myself included). We believe that this country is facing not only fiscal and economic disaster, but social disaster. Every time the government passes a new regulation, mandate, fee, or takes on some new role with respect to individuals, companies or organizations, we lose a little more individual freedom. We don't want you to take care of us. We just want to be able to interact with one another in the absence of force. We don't want you to make change painless. We want you to do the right thing.
Perhaps your voting record is immaculate. Maybe you've said and written all the right things during the course of your career. What were the results? We don't have time for another group of well intentioned politicians to do their very best and come up short...again. We're not interested in politicians that want to appease those who want less government while also appeasing those who want more government. It's not enough to be opposed to toxic policies. Stop them. When two sides advocate diametrically opposed philosophies of the role of government, you can't ride the fence. Pick a side and play to win. I don't know what you can do between now and your next election to convince the voters that you will reduce the size, scope and cost of government, but that's what we demand. As the great philosopher, Yoda, said "Do or do not. There is no try."
The Tea Party is not your enemy. Reality is.
Tuesday, May 18, 2010
Wednesday, May 12, 2010
Is sovereign currency about to go out of style?
Gold has been doing very well lately. As people lose confidence in global currencies, they hedge their bets by buying gold. Gold isn’t patented to any one country and so isn’t dependent on the competence of any government. The drawback is that it isn’t widely accepted as currency. That may be about to change.
in 2009, Thomas Geissler, the chief executive of TG-Gold-Super-Markt in Germany, rolled out a vending machine that dispenses small gold bars and coins. He’s since upgraded it to be able to update the price of gold every two minutes and has installed one in the prestigious Emirates Palace hotel in Abu Dhabi on a day when gold reached another all-time high.
The trouble with world currencies is that the only difference between a dollar bill and a Treasury bill is that one has an expiration date, and you get an interest premium to compensate for it. So when a government issues new debt (which they’ve all been doing a lot of lately) they are essentially creating new money. They’re adding new supply while demand is waning.
Central banks have been able to keep currencies relatively stable with respect to each other by buying and selling one another’s currency to achieve specific target ranges. They have not been able to hold their own against gold. While production does increase supply, demand is strong and growing. It may hit a tipping point if and when some major company or organization starts accepting, then demanding gold as payment.
A convenient way to acquire gold currency, such as Mr. Geissler’s “Gold to Go” machines, might just be a catalyst to creating a new global currency, which would be terrible news for existing global currencies.
in 2009, Thomas Geissler, the chief executive of TG-Gold-Super-Markt in Germany, rolled out a vending machine that dispenses small gold bars and coins. He’s since upgraded it to be able to update the price of gold every two minutes and has installed one in the prestigious Emirates Palace hotel in Abu Dhabi on a day when gold reached another all-time high.
The trouble with world currencies is that the only difference between a dollar bill and a Treasury bill is that one has an expiration date, and you get an interest premium to compensate for it. So when a government issues new debt (which they’ve all been doing a lot of lately) they are essentially creating new money. They’re adding new supply while demand is waning.
Central banks have been able to keep currencies relatively stable with respect to each other by buying and selling one another’s currency to achieve specific target ranges. They have not been able to hold their own against gold. While production does increase supply, demand is strong and growing. It may hit a tipping point if and when some major company or organization starts accepting, then demanding gold as payment.
A convenient way to acquire gold currency, such as Mr. Geissler’s “Gold to Go” machines, might just be a catalyst to creating a new global currency, which would be terrible news for existing global currencies.
Monday, May 10, 2010
Defending the Euro
I just sent this as an email FoxBusiness.com. I thought it would make a good post as well.
Wouldn't it have been better in terms of the value of the Euro as a currency if they had let Greece default (or restructure)? A country's currency is only as valuable as the world perceives it to be. A lot of that has to do with supply control.
I would be more impressed if the Euro-zone had told Greece "No, you can't have more Euro's, find another way." Even had Greece been forced to restructure its debt, that would demonstrate a failed business model, not a failed currency. In fact, the currency was too valuable to just give away.
I would think that would have increased the value of the Euro in the longer term. They haven't propped up the currency. They're trying to prop up a nanny state. I assume because they just don't want to believe it doesn't work.
Wouldn't it have been better in terms of the value of the Euro as a currency if they had let Greece default (or restructure)? A country's currency is only as valuable as the world perceives it to be. A lot of that has to do with supply control.
I would be more impressed if the Euro-zone had told Greece "No, you can't have more Euro's, find another way." Even had Greece been forced to restructure its debt, that would demonstrate a failed business model, not a failed currency. In fact, the currency was too valuable to just give away.
I would think that would have increased the value of the Euro in the longer term. They haven't propped up the currency. They're trying to prop up a nanny state. I assume because they just don't want to believe it doesn't work.
Thursday, April 29, 2010
The Cape Wind debacle
Cape Wind demonstrates that wind and solar are not the answer to our energy Jones.
The Obama administration recently approved America’s first off-shore wind farm, dubbed Cape Wind, off the coast of Cape Cod. This comes after 10 years of mandatory study, review and battling opposition groups. But opponents vow to continue to fight on grounds ranging from historic and cultural preservation to aesthetics, to safety. Similar arguments have held up solar and wind projects across the country.
It’s not just a matter of time. These delays, court battles, mandatory studies and public relations battles cost tens of millions of dollars which must be recovered somehow. If and when a project actually gets done, the cost will have to be built in to utility bills.
Wind and solar farms take up a lot of square miles. It appears there simply is not enough non-contested area on land or sea to even put a dent in our energy needs. Even individuals installing solar panels on their homes, must do battle with neighbors who want to plant or keep their trees.
The Cape Wind project would be 130 giant wind turbines, each 400 feet tall, and would hopefully provide 75% of the power requirements for Cape Cod. Now imagine what it would take to provide even 10% of the power requirements for Manhattan. Solar isn’t any more practical. If you wanted to use solar farms to supply the power needs for New York City, you’d have to cover most of upstate NY with solar panels. It’s just not going to happen.
Everyone likes the warm, fuzzy feeling they get when they talk about “clean” energy, but few want the means of production located anywhere near them. That being the case, perhaps we should stop throwing money down these black holes and look for solutions that have a snowballs chance of seeing the light of day. There are other options. Perhaps the most promising is algae to fuel. Algae farms can be located anywhere that has access to sunlight and carbon dioxide. You don’t even need clean water. Yet for some reason, approaches that are doomed to fail seem to garner all the taxpayer “investment” dollars. This is not an energy policy. It’s a bureaucrat and attorney jobs program.
The Obama administration recently approved America’s first off-shore wind farm, dubbed Cape Wind, off the coast of Cape Cod. This comes after 10 years of mandatory study, review and battling opposition groups. But opponents vow to continue to fight on grounds ranging from historic and cultural preservation to aesthetics, to safety. Similar arguments have held up solar and wind projects across the country.
It’s not just a matter of time. These delays, court battles, mandatory studies and public relations battles cost tens of millions of dollars which must be recovered somehow. If and when a project actually gets done, the cost will have to be built in to utility bills.
Wind and solar farms take up a lot of square miles. It appears there simply is not enough non-contested area on land or sea to even put a dent in our energy needs. Even individuals installing solar panels on their homes, must do battle with neighbors who want to plant or keep their trees.
The Cape Wind project would be 130 giant wind turbines, each 400 feet tall, and would hopefully provide 75% of the power requirements for Cape Cod. Now imagine what it would take to provide even 10% of the power requirements for Manhattan. Solar isn’t any more practical. If you wanted to use solar farms to supply the power needs for New York City, you’d have to cover most of upstate NY with solar panels. It’s just not going to happen.
Everyone likes the warm, fuzzy feeling they get when they talk about “clean” energy, but few want the means of production located anywhere near them. That being the case, perhaps we should stop throwing money down these black holes and look for solutions that have a snowballs chance of seeing the light of day. There are other options. Perhaps the most promising is algae to fuel. Algae farms can be located anywhere that has access to sunlight and carbon dioxide. You don’t even need clean water. Yet for some reason, approaches that are doomed to fail seem to garner all the taxpayer “investment” dollars. This is not an energy policy. It’s a bureaucrat and attorney jobs program.
Monday, March 29, 2010
So you've just been force-fed health care "reform". Now what?
Well, the debate is over. The big health care reform bill is now the law of the land. Like most Congressmen, I can't wait to see what they've done. No more predictions, no more theories. Nothing left to do but watch. Either everything is going to be great...or it's not.
We can still theorize and predict spin and tactics though. Step one was to go public with nasty emails, making it seem as though a bunch of psychos suddenly have come out of the closet to threaten Democrats. The only problem is that lawmakers on both sides of the aisle, and pundits and news anchors, have been getting nasty emails and phone calls as far back as anyone can remember. Both parties received their share in recent weeks and the Sergeant at Arms for the House of Representatives stated there has been no notable increase recently. So why all the commotion? The idea was to make it look as though those who opposed this bill are very bad people.
Next, it's time to demonize corporations again. AT&T, Verizon, Caterpillar and others have announced that they'll be taking big charges against earnings and possibly cutting benefits, jobs or both. Now there are calls for Congressional hearings to make the CEO's of these companies explain themselves. I'll save you the trouble. When a socialist leaning lawmaker sees a company post a $3 billion dollar profit, they think "Well, they can certainly afford a $1 billion, new expense." In reality, if you reduce a company's earnings potential by 33%, you reduce the value of the company by 33% and the stock price will eventually reflect that. It is the job of management to maintain and grow earnings on behalf of the shareholders or owners (the guys they work for). Naturally, they have to take defensive action.
This will be portrayed as "putting profit before the welfare of employees". Maybe that's so, but why do people start and invest in companies? To provide for employees? No, they do it to make money. They pay employees to help them make money, not just for the sake of paying employees. Why do you get up every morning and go to work at the chip assembly plant? Because you feel some duty to humanity to provide them with computer chips? No, you do it to make money. In fact, if you're taking home more than you need to just barely stay alive, you're being greedy as well.
That's where this is going. Once the profit has been removed from business, you're next. Your government will decide how much you need and deserve and that's all you're going to get. Then they'll be flying around in their private jets, meeting at the best of hotels with their entourages in tow, thinking of just the right words to use to convince you how much better life is than it was before.
We can still theorize and predict spin and tactics though. Step one was to go public with nasty emails, making it seem as though a bunch of psychos suddenly have come out of the closet to threaten Democrats. The only problem is that lawmakers on both sides of the aisle, and pundits and news anchors, have been getting nasty emails and phone calls as far back as anyone can remember. Both parties received their share in recent weeks and the Sergeant at Arms for the House of Representatives stated there has been no notable increase recently. So why all the commotion? The idea was to make it look as though those who opposed this bill are very bad people.
Next, it's time to demonize corporations again. AT&T, Verizon, Caterpillar and others have announced that they'll be taking big charges against earnings and possibly cutting benefits, jobs or both. Now there are calls for Congressional hearings to make the CEO's of these companies explain themselves. I'll save you the trouble. When a socialist leaning lawmaker sees a company post a $3 billion dollar profit, they think "Well, they can certainly afford a $1 billion, new expense." In reality, if you reduce a company's earnings potential by 33%, you reduce the value of the company by 33% and the stock price will eventually reflect that. It is the job of management to maintain and grow earnings on behalf of the shareholders or owners (the guys they work for). Naturally, they have to take defensive action.
This will be portrayed as "putting profit before the welfare of employees". Maybe that's so, but why do people start and invest in companies? To provide for employees? No, they do it to make money. They pay employees to help them make money, not just for the sake of paying employees. Why do you get up every morning and go to work at the chip assembly plant? Because you feel some duty to humanity to provide them with computer chips? No, you do it to make money. In fact, if you're taking home more than you need to just barely stay alive, you're being greedy as well.
That's where this is going. Once the profit has been removed from business, you're next. Your government will decide how much you need and deserve and that's all you're going to get. Then they'll be flying around in their private jets, meeting at the best of hotels with their entourages in tow, thinking of just the right words to use to convince you how much better life is than it was before.
Sunday, March 21, 2010
How “exceptionalism” killed the American experiment
Our founding fathers embarked on a great experiment when they created the United States of America. What if the individual citizens held all the power? What if government were required to be responsive and accountable to its citizens? What if individual rights trumped the interests of the state? What if individuals were free to pursue happiness by their own definition. Of course, with individual freedom comes individual responsibility. Hence we started making exceptions.
Over the decades and centuries we decided that individuals are responsible for themselves, except that we’ll have Social Security, and welfare, and Medicare and Medicaid and unemployment insurance and a host of other safety nets, grants and entitlements. Individuals are free to enjoy their private property except when doing so conflicts with the “general welfare”. For example if society can make better use of your land than you by building a new road, or even a shopping center, you’ll just have to give it up for the greater good. Individuals shall be free to engage in trade, except that they’ll do so in pre-designated zones, and collect the proper taxes and pay various fees, and obtain proper licenses and comply with the appropriate regulations. Citizens have the right to bear arms, except when they don’t. Taxes shall be imposed in a uniform manner, except when the government decides to use tax credits, penalties, incentives and varying rates to influence behavior.
Now we’ve made the ultimate exception by deciding that the government is responsible for ensuring everyone gets health care. In this debate, the cost, whether or not to cover abortion, tax rates, fees and other clauses were really side issues. The underlying issue is power. The government now has legitimate justification to regulate every aspect of your life. If we’re all providing for each others health care, anything that might impact the cost or delivery of health care becomes everyones business. The food you eat, the car you drive, the recreation you engage in all have the potential to do me financial harm in the form of increasing health care costs and so I now have a vested interest in them. It’s now up to the government to ensure that the impact of your activities on me is minimized. Your activities will have to be monitored and regulated. Think this is hyperbole? When the President signs the bill on Tuesday, the IRS will officially be in charge of monitoring whether or not you have the proper health care plan, and doling out penalties if you don't.
We are in the midst of a substantial shift, from a society that put the individual on top, to one in which the individual is irrelevant. Society is no longer a tool for the individual to make use of when and if he or she chooses. It is now a master to be nurtured, fed and obeyed. You are called upon to “serve something higher than yourself”. After all, your self is insignificant. It’s others that matter. Others means everyone except you. We still choose our leaders in democratic elections. But, those leaders are now charged with serving the greater good through the power of the state, not with protecting the rights of any individual. Individuals are expendable.
Many people are very pleased with this evolution. They believe that a collectivist society can work if it’s implemented correctly and gradually. To me, it’s like a kid believing that if they move their finger to the hot stove slowly enough, it wont burn this time. People gravitate towards the socialist ideal because they believe that somehow, they’re personally going to come out ahead. All you have to do to get things from “society” is demonstrate that you’re more needy than others. Predictably socialism has demonstrated a great capacity to increase neediness. I don’t believe that the results at this latest attempt to create a collectivist Utopia will prove to be an exception.
Over the decades and centuries we decided that individuals are responsible for themselves, except that we’ll have Social Security, and welfare, and Medicare and Medicaid and unemployment insurance and a host of other safety nets, grants and entitlements. Individuals are free to enjoy their private property except when doing so conflicts with the “general welfare”. For example if society can make better use of your land than you by building a new road, or even a shopping center, you’ll just have to give it up for the greater good. Individuals shall be free to engage in trade, except that they’ll do so in pre-designated zones, and collect the proper taxes and pay various fees, and obtain proper licenses and comply with the appropriate regulations. Citizens have the right to bear arms, except when they don’t. Taxes shall be imposed in a uniform manner, except when the government decides to use tax credits, penalties, incentives and varying rates to influence behavior.
Now we’ve made the ultimate exception by deciding that the government is responsible for ensuring everyone gets health care. In this debate, the cost, whether or not to cover abortion, tax rates, fees and other clauses were really side issues. The underlying issue is power. The government now has legitimate justification to regulate every aspect of your life. If we’re all providing for each others health care, anything that might impact the cost or delivery of health care becomes everyones business. The food you eat, the car you drive, the recreation you engage in all have the potential to do me financial harm in the form of increasing health care costs and so I now have a vested interest in them. It’s now up to the government to ensure that the impact of your activities on me is minimized. Your activities will have to be monitored and regulated. Think this is hyperbole? When the President signs the bill on Tuesday, the IRS will officially be in charge of monitoring whether or not you have the proper health care plan, and doling out penalties if you don't.
We are in the midst of a substantial shift, from a society that put the individual on top, to one in which the individual is irrelevant. Society is no longer a tool for the individual to make use of when and if he or she chooses. It is now a master to be nurtured, fed and obeyed. You are called upon to “serve something higher than yourself”. After all, your self is insignificant. It’s others that matter. Others means everyone except you. We still choose our leaders in democratic elections. But, those leaders are now charged with serving the greater good through the power of the state, not with protecting the rights of any individual. Individuals are expendable.
Many people are very pleased with this evolution. They believe that a collectivist society can work if it’s implemented correctly and gradually. To me, it’s like a kid believing that if they move their finger to the hot stove slowly enough, it wont burn this time. People gravitate towards the socialist ideal because they believe that somehow, they’re personally going to come out ahead. All you have to do to get things from “society” is demonstrate that you’re more needy than others. Predictably socialism has demonstrated a great capacity to increase neediness. I don’t believe that the results at this latest attempt to create a collectivist Utopia will prove to be an exception.
Sunday, March 7, 2010
Was it the spending or the war that ended the Great Depression
With our national debt currently at around 86% of Gross Domestic Product and rising, many are concerned about the fiscal future of our country. Others point to the 1940's, when spending on World War II skyrocketed national debt to 120% of GDP and pulled us out of the Great Depression. They credit massive government spending with saving the economy.
If you look only at the statistics, that's true. But you have to put the spending in context. World War II was an endeavor that most individuals in the country had to be personally involved in. Millions of able bodied adult males were drafted and the women worked the factory jobs. We didn't have drones, satellites and assembly line robots. We had to use people. As a result, a huge segment of the population was taken out of its comfort zone and exposed to new ideas, new people, new places. It was a nation-wide life changing phenomenon even greater than the internet.
The massive spending was not on "make-work" projects. We needed specific things for our very survival. We needed air craft carriers, ships, vehicles, bombs. We had to reverse engineer whatever the enemy came up with. We needed to do it better and throw it right back at them. It was a highly motivated population working at absolutely necessary endeavors. We were not building bridges to nowhere, studying ketchup flow or planting flowers in the highway medians, just to keep people busy.
All of these things together created a huge jump in productivity and we were able to overcome the massive debt we had created. We are in a very different circumstance today. Spending alone will not fix our economy any more than recruiting one member of the New Orleans Saints will get you a Super Bowl win next year.
Perhaps fending off an invasion of extra-terrestrial invaders could have a similar impact. But, I don't think banking on that scenario is a good idea. It's time to reign in the government and its spending and remove the overhanging burden of massive debt from the marketplace.
If you look only at the statistics, that's true. But you have to put the spending in context. World War II was an endeavor that most individuals in the country had to be personally involved in. Millions of able bodied adult males were drafted and the women worked the factory jobs. We didn't have drones, satellites and assembly line robots. We had to use people. As a result, a huge segment of the population was taken out of its comfort zone and exposed to new ideas, new people, new places. It was a nation-wide life changing phenomenon even greater than the internet.
The massive spending was not on "make-work" projects. We needed specific things for our very survival. We needed air craft carriers, ships, vehicles, bombs. We had to reverse engineer whatever the enemy came up with. We needed to do it better and throw it right back at them. It was a highly motivated population working at absolutely necessary endeavors. We were not building bridges to nowhere, studying ketchup flow or planting flowers in the highway medians, just to keep people busy.
All of these things together created a huge jump in productivity and we were able to overcome the massive debt we had created. We are in a very different circumstance today. Spending alone will not fix our economy any more than recruiting one member of the New Orleans Saints will get you a Super Bowl win next year.
Perhaps fending off an invasion of extra-terrestrial invaders could have a similar impact. But, I don't think banking on that scenario is a good idea. It's time to reign in the government and its spending and remove the overhanging burden of massive debt from the marketplace.
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