Tag Archives: economy

The Gathering Fiscal Storm

BY STEVE BELL

We have written about the fiscal cliff and its possible economic consequences several times in recent months.  Other organizations have been more sanguine about the impact of the expiring tax cuts and large federal spending reductions that are set to occur at the beginning of January 2013.

A few days ago, the Congressional Budget Office (CBO) released its latest assessment of the fiscal cliff and the analysis bolsters our argument: Going over the cliff inevitably leads to a serious recession.

Continue reading →

Gillespie Deploys MacArthur Strategy

BY JOHN FEEHERY
Reprinted from TheFeeheryTheory.com

Ed Gillespie is a modern day Douglas MacArthur. Let me explain.

On September 15, 1950, MacArthur led a force of mostly United States Marines in an amphibious assault at the largely undefended port of Inchon that was located far behind enemy lines. The North Koreans had closed in on American forces around the city of Pusan and the UN forces needed a break-out strategy. The strategy to go on offense helped to turn the tide of the war and the United Nations forces were able to drive the North Koreans back to their portion of the peninsula.

What MacArthur did was a lot like what Ed Gillespie has reportedly done with the Romney campaign. He decided that the best defense was a very good offense. Continue reading →

Hating Business Not Good Business

BY GARY JOHNSON
Reprinted from Loose Change (TCBMag.com)

“Therefore I hated life; because the work that is wrought under the sun is grievous to me, for all is vanity and vexation of the spirit.”—Ecclesiastes 2:17

“Corporations: an ingenious device for obtaining profit without individual responsibility.” Though Ambrose Bierce, a sensationalist writer working for William Randolph Hearst, said it a century ago, it could easily have shown up on any number of signs at rallies across the United States and Europe this year. If 2011 was the year of the Rabbit, 2012 is the year of Business Haters.

Jack Welch, outspoken and legendary former CEO of General Electric, is touring the country with his wife, which is nice. She’s Suzy, an author and former Harvard Business Review editor. Though General Electric has mostly abandoned Welch’s Continue reading →

Bain Gambit Takes Campaign to Gutter

BY MICHAEL S. JOHNSON

A United States Senator who enjoys wide respect for his legislative skill and political insight predicted privately the other day that the 2012 Presidential campaign may become one of the most negative and brutal in our nation’s history, rivaling the 1800 Adams-Jefferson campaign.

His prediction was ever so prescient because the very next day a spokeswoman for President Obama accused Mitt Romney of being either a liar or a felon.

The American people need to put a stop to this nonsense before it gets any worse. The Republican mudslinging in the primary was disgusting, and now it is a cancer in the general election campaign.

Continue reading →

Bank Regulations Killing Banks

BY RICH GALEN
Reprinted from Mullings.com

A Wall Street Journal story by Robin Sidel looks at a troubling trend in the banking industry. No, not the JPMorgans of the industry losing $2 billion on bad bets, but on small community banks who don’t have the word “billion” anywhere on their balance sheets.

According to her piece: “A growing number of tiny community banks are deciding it’s time to put out the ‘for sale’ sign … many executives of these small lenders are frustrated by costly, new regulations.”

Let’s head into the Way Back Machine: In October, 1975 New York City was on the verge of bankruptcy. Sort of like California in the summer of 2012.

New York’s Democratic Mayor and Governor (Abe Beame and Hugh Carey) came to Washington, DC begging for Federal help. President Gerald Ford said he would veto any bill which would have the effect of taxpayers in, say, Michigan, bailing out New Yorkers whose profligate ways had led them in that fiscal blind alley.

The New York Daily News published a famous front page with a photo of Ford and the blaring headline: Ford to City: Drop Dead. Continue reading →

President Obama’s Fine Mess

BY JOHN FEEHERY
Reprinted from TheFeeheryTheory.com

My friend Meg’s mother likes to say, “Everything is fine until it’s not fine.” That pretty much sums up Barack Obama’s quest for reelection.

The President stepped in it last week when he reiterated his belief that the private sector is “doing fine.” The Romney campaign jumped on the statement and got plenty of traction framing the President as out-of-touch on what is really happening with our economy.

When unemployment is north of eight percent, obviously things are not fine with the private sector. It is easy to see why the White House believes everything is fine with the private sector, especially as compared to the public sector. Jobs have been created in the market place but have been lost in government, especially at the state and local level. The Obama team sees those statistics and assumes that the real problem with the unemployment numbers comes with severe cuts in government spending. Continue reading →

The Gaffe That Keeps On Giving

BY RICH GALEN
Reprinted from Mullings.com

Two weeks ago the Department of Labor’s Bureau of Labor Statistics dropped a bomb on the Presidential campaign of Barack Obama when it released data showing only 66,000 jobs had been created in May – far below estimates – and that the top-line unemployment rate rose from 8.1 to 8.2 percent.

This past Friday at a press conference, in response to a question about the GOP’s contention that it is his Administration’s policies that are strangling job growth, President Obama said, “the private sector is doing fine.”

He went on to explain that the rise in unemployment is largely due to budget difficulties at the state and local government level because mayors and governors are not getting the “kind of support they need from the federal government.” The federal government needs to send money to states and cities so those governments can hire more people. People who may do important work, but create nothing.

A few short hours after Obama had essentially proclaimed the return of prosperity for private industry, Bloomberg.com was running a piece by Chris Burritt headlined, “CEOs Losing Optimism as Job Slowdown Imperils U.S. Growth.” Continue reading →

Economy Ticking Time Bomb

BY RICH GALEN
Reprinted from Mullings.com

From Bayeux, France, I am in Normandy for the annual D-Day commemoration on Wednesday. As part of this year’s festivities the World War II Foundation, headed by Tim Cook is presenting a statue of Major Dick Winters who was the central character in “Band of Brothers.”

More about that on Wednesday.

As I type this it is 5 AM Monday morning in France. That means it is 11PM Sunday night on the East Coast of the United States.

That is only useful because I am looking at the Asian markets as they open for business after Friday’s dreadful jobs numbers. As of this moment both the Japanese and Hong Kong market indices are down two percent. The European markets are set to open lower in that same range which means if the Dow follows suit it will lose nearly 250 more points today and end well below 12,000.

Other than my 401(k) being worth about 268.67(k) or minus one-third of its value, I am not much of a player in the stock market. However, like you and everyone else I have a monetary interest in the direction of the economy.

The direction appears to be decidedly down. Continue reading →

Economic Shank Shot

BY JOHN FEEHERY
Reprinted from TheFeeheryTheory.com

My Uncle Bob calls it the dreaded perpendicular shot.

In golf, when you mis-hit a golf ball so badly that it almost kills the person standing next to you, you have hit a shank. A shank can happen to anybody. And it is very, very scary when it does happen.

The golfer has no idea how it happened or why. One minute you are hitting the ball straight as an arrow. Then next minute, your ball is whizzing around the head of your playing partner.

There was a great scene in the movie “Tin Cup”, when Kevin Costner, the washed-up player who attempts a dramatic come-back after winning a qualifier to play in the U.S. Open, gets a bad case of the shanks on the practice tee before he starts his round. His caddie, played by Cheech Marin, goes through a crazy routine that seems completely non-sensical, all to achieve one goal: To get Costner’s character to forget about his shank and to start hitting the ball again.

I was thinking about that scene and about shanks in general when thinking about what happened to our financial markets four years ago. Continue reading →

Hazing The Rich

BY GARY JOHNSON
Reprinted from Loose Change at TCBMag.com

Hey brother, can you spare a dime?

On second thought, keep it. . . . I’d prefer that people like me.

Two-thousand twelve is not a good year to be rich. I haven’t seen rich-bashing like this since my days as a 10-year-old caddy at Minnehaha Country Club in Sioux Falls. My pals and I would deride the potbellied, Cadillac-driving, cigar-chomping rich guys whose golf bags we lugged around on hot summer afternoons, chasing down their shanks, duck hooks, and chili dips for a 25-cent tip.

Although we had nothing but contempt and fear for these guys, not a day went by that we didn’t think to ourselves, “I’m going to work my butt off and someday have a bunch of money just like them.” Unfortunately for me and some chums—Jaybird, Kenny the Torch, Boo Radley, Punjab, Laff-A-Lot, and Bucky—that plan didn’t work out so well. Continue reading →

America Needs to Go For a Long Run

BY JOHN FEEHERY
Reprinted from TheFeeheryTheory.com

The Long Run was one of the best albums ever produced, and I was thinking about the title song on Tuesday.

I have long believed that our federal government is far too focused on short-term thinking, and our policies are not built for the long run. And I think that most voters get that fact, which it is one of the reasons they are so frustrated with our national politicians.

Probably the best part of the President’s State of the Union speech came when he used the word “durable” to describe his vision of the American economy.

Of course, it was all bullshit, because the President has been the king of the temporary fix, but the sentiment is exactly right. Our economy needs to be built for the long run.

What does that mean? Continue reading →

Obama’s Double-Dip Learning Curve

BY TONY BLANKLEY
Reprinted from The Washington Times

In one of the least-needed reassurances in modern political history, President Obama’s top political man, David Plouffe, “told Democrats late last week that the White House would not suffer from overconfidence. ‘What I don’t want to suggest is that we’re sitting around and thinking everything is great,’ he said.”

With the White House’s own economists predicting 9 percent or worse unemployment on Election Day, the president at about 39 percent job approval, college graduates unable to find jobs, a quarter of American homes under water, no credible White House policy or strategy for changing things – and with most non-institutionalized Americans convinced we are in a recession that is going to get much worse – it is surpassingly odd that Mr. Plouffe, as The Washington Post said, was worried that his fellow Democrats might think the president and his men think everything to be hunky-dory. Continue reading →

Obama Economic Policy Last Chance

 

BY TONY BLANKLEY

Reprinted from the Washington Times

 

President Obama’s post-Labor Day “jobs” speech will be his last chance to launch an economic policy with any chance of manifesting its effect – both economic and political – before the November 2012 elections. He has three options. In order of descending likelihood, they are: a timid hodgepodge of previous proposals, a bold left-of-center initiative or a turn to a free-market “nuclear option.” Continue reading →

Krauthammer Wrong, Politics Dysfunctional

BY MICHAEL S. JOHNSON

My daughter was in Canada recently and went into a gift shop to buy a souvenir.  She handed the clerk U.S. dollars and the clerk called the manager over to get the most recent exchange rate. “We don’t take American money anymore,” the manager said. “Things are so unpredictable down there, we never know what the dollar is worth.”

Early in August, 5,000 Federal Aviation workers were thrown out of work without pay, along with thousands of construction workers because Congress couldn’t get its act together and reauthorize the agency. Workers were left without income to pay mortgages, car payments and buy groceries. Continue reading →