Archive for the 'Government' Category

California Criticism

Posted on March 13, 2012, 8:01 am. Closed

Op-ed criticizing California today in the WSJ. Here’s a teaser:

California’s rising standards of living and outstanding public schools and universities once attracted millions seeking upward economic mobility. But then something went radically wrong as California legislatures and governors built a welfare state on high tax rates, liberal entitlement benefits, and excessive regulation. The results, though predictable, are nonetheless striking. From the mid-1980s to 2005, California’s population grew by 10 million, while Medicaid recipients soared by seven million; tax filers paying income taxes rose by just 150,000; and the prison population swelled by 115,000.

In Nuclear Silos, Death Wears a Snuggie

Posted on January 24, 2011, 6:34 am. Closed

I thought this was a real interesting article from Wired:

After nearly four years of pulling ICBM-alert duty, this process is instinctive. I deliberately recite the encrypted characters to ensure my deputy is on the same page, literally and figuratively, as six short characters can effectively communicate a wealth of information through the use of special decoding binders. “Charlie, Echo, Seven, Quebec, Golf, Bravo, six characters ending in Bravo.” My partner concurs, scribbling in his code book.

“Crowd pleaser,” he adds without emotion, referring to a war plan that mandates immediate release of our entire flight of nuclear missiles, 10 in all.

Of course, this is just a training scenario. The coded orders are a simulation. The console is a mockup of the real thing, stowed away in a larger hanger and serviced seven days a week by a small staff of Boeing contractors.

If this were a real event, I’d be buried in a steel cocoon 100 feet underground. I’d have shed my standard-issue flight suit and boots. Instead, I’d be wearing sweats, fleece-lined slippers and, naturally, my indispensable, royal blue Snuggie.

An Ineffective Regulatory System

Posted on August 21, 2009, 10:50 am. Closed

We have too many ineffective regulators: the OCC, Fed, OTC, FHFA, SEC, FDIC, and more. Watching the regulatory system is like watching bad doubles tennis players. No one hits the ball thinking the other guy will get it. Investment banks are not suffering from too much regulation. The global capital markets are suffering from too little competent regulation where it counts most.

Page 205 of Dear Mr. Buffett: What an Investor Learns 1,269 Miles from Wall Street by Janet Tavakoli.

Here’s One Way to Get Rid of Our Debt

Posted on August 14, 2009, 9:30 am. Closed

The Onion reports on how the U.S. government has staged a fake coup to renege on all its debt. I think it’s pretty close to what will happen eventually.

“Buy American” Rule Delays Gov’t Stimulus Projects

Posted on August 7, 2009, 8:37 am. Closed

From Bloomberg:

President Barack Obama’s stimulus spending has run into a problem: A shortage of General Electric Co. water filters.

GE makes them in Canada. Under the program’s ‘Buy American’ rules, that means the filters can’t be used for work paid for by the $787 billion fund.

Contractors are searching the U.S. in vain for filters as well as bolts and manhole covers needed to build wastewater plants, sewers and water pipes financed by the economic stimulus. As officials wait for federal waivers to buy those goods outside the U.S., water projects from Maine to Kansas have been delayed.

See what happens when the government gets involved in anything? By placing artificial terms, conditions, and regulations on the marketplace, you often wind up with negative and/or unforeseen consequences. In this instance, I think most people could foresee that the Buy American provision was just a blatantly stupid rule. Now we have evidence.

True Bull Market or Bear Market Rally?

Posted on August 5, 2009, 8:02 am. Closed

This video from Warren Pollock explains in part why we may or may not be in a new bull market or just a bear market rally. He says that when we have a rising US dollar and a rising stock market, this is  a true bull market. However, when our currency is falling and the market is rising, this is a sign of a false bull market.

Also, if you have the time, I highly recommend watching Pollock’s full presentation entitled “The Great Reset”, the goal of which is to provide a political, economic, and social forecast in the context of the systemic failure that has already occurred in the US. Though I disagreed with some small parts of the presentation, it was nevertheless very thought-provoking.

Federal Stimulus Spending: An Oxymoron

Posted on August 3, 2009, 5:14 pm. Closed

The second quarter 2009 review and outlook by Hoisington Investment Management Company gives a good overview of the complex monetary chain between Fed actions and the economy. Stuff like money multipliers, velocity of money, and supply curves are discussed.

What was more interesting to me was the cited research that suggests the term “federal stimulus spending” is an oxymoron. The Hoisington outlook states, “Many assume that the act of sending checks from the federal government sector to the private sector helps the economy through so-called spending multipliers.” However, some researchers have found that “the government expenditure multiplier from 1955 to 2006 was negative .01, not statistically different from [zero].”  This means “that each $1 increase in government spending reduces private spending by about $1, with no net beneft to GDP.  All that is left is a higher level of government debt creating slower economic growth.”

I’m not sure if I am merely seeking to confirm my biases here, but I feel that this is good evidence that there is no multiplier effect from the federal government increasing its debt to “stimulate” the economy. After having correctly intervened to avert a major crisis during the first quarter of this year, the government should allow the private sector to do its thing — the last thing the government should be doing is ratcheting up the debt because the effect is negligible at best and most likely negative  for the American people. The only people benefiting from increasing levels of debt are the politicians who are able to hand out favors and bribes to their constituents via government expenditures. President Obama is another one of the few beneficiaries of this crazy policy — I am sure he still has many campaign favors to repay.

More Ackerman Goodness

Posted on February 4, 2009, 10:26 pm. Closed

I found an even better clip of Ackerman berating the SEC officials. Enjoy.

Congressman Ackerman Berating SEC Officials

Posted on February 4, 2009, 7:14 pm. Closed

Here’s a video of Congressman yelling at the SEC officials today.

Looking back at this exchange, it was rather cathartic to hear, but probably not very helpful in the scheme of things. But then again, having the SEC stooges testify today was not very helpful either.

Thank You Congressman Ackerman

Posted on February 4, 2009, 4:03 pm. Closed

Thank you Congressman Ackerman. Thank you for excoriating the bumbling SEC idiots. Hopefully there will be some video of his questions.

Also, I learned that one of the testifying SEC officials, Lori Richards, recused herself from the Madoff investigation because a former employee she supervised had married Madoff’s niece, and Richards was at the wedding!

After listening to the testimony today, I feel there must have been some sort of cover-up in regards to the Madoff investigation if the SEC officials were telling the truth about their level of competency and commitment to uncovering fraud and protecting investors.

Before this country starts to recover economically, people must regain confidence in those who are running and regulating the financial industry. I believe confidence will only come back when the heads of professionals and regulators start to roll in a very public way.

Mr. Markopolos’s suggestions should be put into effect immediately. I would also double the minimum level of punishment for those found guilty of stealing money or helping to steal money from investors.