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So maybe the picture I made is a bit of a stretched hyperbole, however, you get the idea. According to a recent article on Yahoo Finance, should Congress pass Obama’s stimulus bill, it will make the U.S. government’s total for trying to solve our financial crisis a sum of about $9.7 trillion dollars. Conincidently, this same amount is enough to pay off 90% of the nations mortgages, which in essence gives you an idea of how much liability is floating around the U.S.
So ask yourself this question: We have heard of the $700 billion bailout, this new $826 billion stimulus, and last year’s $168 billion stimulus payment, what happened to the other $8 trillion? Makes you stop to think doesn’t it? Supposedly most of that money has gone to pledges made by our U.S. government to help get us through this financial crisis, but you know our government, and that lie “fact” can be taken to the bank, which isn’t the best place to go as they might use whatever to take to them to payoff their CEOs.
Still don’t understand the magnitude of our debt, let me break it down even further. This massive amount of money is equal to paying each person in the U.S., man, woman, child, a sum of about $1,430 and is about 13 times the amount spent in Iraq and Afghanistan. Ridiculous isn’t it? And they said this war was what was expensive; think again. In fact I think the war is a good thing. Just ask Roosevelt what he thought about the war? What do you think got us out of the Great Depression, yeah you guessed it, the war.
I do admire one group of individuals over at Bloomberg who have decided to sue The Fed. Yes you heard right, sue The Fed. Basically they want some more disclosure on the amount of lending and to who the money has been going to. I myself wouldn’t mind knowing too, as in case you didn’t already know, when I say $9.7 trillion, I mean $9.7 trillion taxpayer dollars. Want more fuel? They plan on spending another $200 billion in asset protection for banks and other financial institutions and have pledged more money to the Bank of America and Citigroup securities.
Call me crazy, but how is it logical to try and fix debt with more debt? That is like having two maxed out credit cards, and paying half of each by using a third credit card. Granted this is normal practice to save on APR, however, in the government’s case, they are then going back and maxing out the first two cards again and maxing out the third newly acquired card. Obviously this analogy is a bit simplistic, however, the general idea is the same.
I know we have to spend money to make money, however, when does it stop? When do we begin to realize that while taxcuts are a nice security blanket to sleep under, as well as a nice pacifier for the American people to suck on so we can somehow feel at ease with everything else that is going on ,taxcuts are not the answer. Taxcuts just make us taxpayers feel warm and fuzzy and reduce government revenue, causing them to seek funds elsewhere, and I can’t imagine who they would turn to.
The topic of the bailout may be over played and over heard at this point, however, with good reason. Should the government continue down this path, expect the dollar to be worth peanuts, expect inflation to kick into 5th gear, expect unemployment to continue rising, expect the going rate to slowly creep its way back up and expect the supply of money to either become scarce due to more government issued lending or due to the simple fact that it just won’t exist. See if that makes you feel warm and fuzzy….yeah didn’t think so.
This all to familiar image above is but a taste of things to come. With cash becoming more and more scarce and banks still dubious to release funds to anyone, it is no wonder more articles are springing up about companies going out of business.
Obviously Circuit City is the most well known company to declare chapter 7 bankruptcy, however, so many other businesses out there are headed in the same direction. When you see a company declare chapter 11 bankruptcy, expect 2 things: They will either downsize and cut costs and try to come up with a fresh source of financing to aid in the process of rebuilding, or after time passes and little changes, declare chapter 7 bankruptcy.
What I don’t understand is how despite the fact that the government threw $700 billion dollars at financial institutions, banks are still finding it difficult to loan money. I know that rules and regulations are more stringent than they were in the past, in the past all you needed was a first name and a pulse and you had a loan for anything, even if it was funding your lacadisic tendencies(Which seems to be the case for most), however, their needs to be some type of structure in place in order to make sure the right people are getting the money they need to continue doing business.
I don’t want to get into a discussion about the bailout, as it would lead to a post about how Bank of America is talking about nationalizing itself and how the government is rewarding failing firms for failing, instead of helping those who are doing well continue to do well in these hard times, but let’s be honest here, where is all this money going? And why do I hear more about CEOs using golden parachutes and splitting with millions, while the unemployment rate soars above 7.8% soon to be 10% by 2010.
The government isn’t doing anyone any favors. They aren’t “stimulating” the economy; in reality, they are stimulating themselves. I saw a clip of the John Stewart show a friend of mine sent me, and I have to say I agree with what he was saying. His idea was to do a reverse stimulus, which would work its way from the consumer and then lead to the bank. This makes sense, as most money spent by consumer to either pay bills or make purchases, ends up being deposited into the bank.
I honestly don’t see any of the bailout money being put to good use. Obama’s stimulus bill, while yes it does look promising, carries a high price tag in that not only does it cost close to $900 billion, more importantly, it allows for more government regulation, something I am opposed to and something that usually borders socialism, depending on the magnitude of the regulation.
There does, however, exist a positive side to all this. The fact that companies nationwide, specifically retail stores are doing poorly in sales means that consumers are beginning to understand the idea of living within their means, something we as Americans have lost sight of. Part of this whole problem is people paying debt with debt and digging themselves deeper and deeper into a hole with a shovel they never owned and a lot of land that was never theirs.
Don’t be dicouraged by the failing companies. Recession is not always a bad thing. For some it is an ideal buying opportunity. Let us not forget too that recessions are a natural part of the economy. The reason this recession is so painful is as a result of consumer spending with no concern for reality, major companies frivolously wasting money on bad investments and hopeless projects (Yes GM I am talking to you and your truck-line, being produced in a $2-3 a gallon of gas economy), companies amasing large amounts of liabilities, and banks throwing money at anyone with a first and last name.
It is almost like banks want government regulation. Then again, who wouldn’t want the government to spoon feed them everything, in return for loyalty. Good thing Bank of America isn’t nationalizi…..err….yeah it isn’t looking good….
Keeping up with this blog is harder than I thought. Something about wanting the posts to be well written and having little time to do everything makes it so much harder than I expected. I have plenty to talk about, but so little time with which to work with. Tomorrow at work I should have some free time to get to blogging, in the mean time, here is a video I found, this should keep you entertained until I find something worth posting on and which I can find the time to invest research into. On a side note, before you watch the video, consider this piece of advice: You will not always know what it is you are doing, however, it is imperative that in all situations, whether you know what you are doing or not, that you surround yourself with people that do know what they are doing. Something my dad always taught me. Dale Carnegie is the man, consider reading his books…
On to the video:
Well hello! After a few days of playing catch up with my studying and career hunt, I finally have a moment to blog and what better subject then that stimulus bill that is hovering over the minds of everyone in this country.
In my last post I was somewhat happy with the idea of the stimulus, and overall, I was pleased with the results it would bring. However, after further analysis and much deliberation within myself, I now come to realize it isn’t all it’s cracked up to be.
The bill went from some $815 billion to a nice 900 billion…what? With a deficit of somewhere around $11.9 trillion, you want to add the $700 billion and this $900 billion? What happened to cutting government spending? So then in order to cut government spending, we need to increase it and decrease government revenue (which is what this bill would do)? Huh?
What is worse is that the bill is causing a special blend of racism amongst parties. A friend of mine put together a well written blog concerning this subject, if you care to read it, feel free. What I mean by racism is that this bill is doing more splitting than it is uniting.
What happened to that bi-partisan speech Obama gave just a month or two ago? It seems to me their is a larger split in our house and senate than there was prior to his election. The stimulus bill itself caused such a political roar that every republican and a few conservative democrats voted against it. Regardless the bill passed the house due to the majority of democrats in the house, however, isn’t it accomplishing more harm than good?
I agree with most of the credits and tax law changes, but the bill goes beyond that. Included in it is a huge list of “things to do” that range from communication and transportation to education and miscellaneous jargon. What’s more is the bill is being sold as a way to create jobs, but given the number of jobs it would produce, the outcome would be a cost of 1.3 million for every job it created, doesn’t sound like the stimulation we all had in mind.
It seems as though we are beginning to hack through the jungle that was Obama’s rhetoric and coming to the realization that he may need a bit more behind his “change” if he expects to do anything about unity and problem solving. I am not putting the man down, he accomplished a lot through his election, however, the time for glorifying his every footstep because of the color of his skin or the use of the word change must pass, and I think we as Americans should begin focusing on the real issue at hand, not some media-fabricated issue of discrimination that will always exist regardless of the color of a person’s skin. (Because discrimination goes beyond skin in today’s world) Oh yeah and the horrible choice in his anti-tax administration isn’t helping make his judgment look like the right kind of judgment.
Where would you get the money to support such a bill if you are reducing our revenue and increasing our spending? You know the answer and so does China, a country that easily owns 40-50% of our countries loans outstanding. Makes you wonder who it is will be calling the shots in the world economy in the not so distant future. Won’t be US if we keep this up.
“Gov. Rod Blagojevich was thrown out of office Thursday without a single lawmaker coming to his defense, brought down by a government-for-sale scandal that stretched from Chicago to Capitol Hill and turned the foul-mouthed politician into a national punchline.” – Yahoo
I think the title says it all.
I was having a great day today until I came across this on the web. I know I said I would keep it to a minimum on the politics because of how pressed on time I have been with the tax season starting off, however, this picture made me want to swallow my own hand and proceed to beat my insides until I keeled over and died.
So let me see if I understand this correctly, a man who was impeached from office by a 114-1 vote, who was charged with conspiracy to commit mail and wire fraud and solicitation of bribery, is a public celebrity. So wait, all I need to do to get women and fame is to commit fraud to one of its highest degrees.
See this is what I spoke of in an earlier post with the flaw of our law. How is it that this man is not only making a case for himself and battling what he is truly guilty of, but is also acheiving celebrity like fame. I don’t understand how people are so blind and stupid that they condone such behavior.
I think the only thing worse would be if I heard on the news that some giant philanthropist donated a large some of money to Bernie Madoff, I think that may be the only thing worse than this picture.
So after much debating and thought, I finally decided to start my own blog. Thanks to Jorge who inspired me to go forward with this. Seeing as this first post is being made in class, listening to my Jewish Business Law professor speak about his life rather than speak of relevant topics, this post will probably be short and sweet.
Topics that I may blog on will range from politics (don’t expect in depth stuff, not a fan of the politics) to business topics with an emphasis on accounting from time to time, and taxes, of course. In fact if anyone ever has any questions concerning taxes, this would be a good place to ask. If I don’t know the answer usually I’ll go to the IRS for the answer.
God this professor talks so much garbage. Am I not supposed to be learning about business law and ethics, no he would rather go off on some tangent and talk about his friend the doctor and some case he had with him back when the dinosaurs roamed the earth (yeah this guy is old).
So is it just me or is everyone making to much of a big deal about Tim Tebow and his bible verses? So anyone who doesn’t already know knows, I am a born again Christian and proud of it. Seeing as that might make my opinion biased, just take it for what it is. If I remember right, doesn’t the first amendment say we have the freedom of speech? And isn’t the law “separation of church and state” not “separation of church and sport”? I don’t say this from the stand point of a person who thinks Christianity should be shoved down your throat, more so from the stand point of a person who is simply seeing someone express themselves the way they see fit, and seeing as it isn’t hurting anyone, nor is it causing some massive riot, it shouldn’t be considered a giant public issue being heavily scrutinized by sports writers. Their is nothing you can take away from the guy. He is a great college QB, great person, great philanthropist, big time football icon, and he happens to wear a bible verse under his eye. Somehow, that small 2 inch mark under is eye, is greater than his 3 years of success.
Any way, hope you all enjoy future posts and look forward to seeing both good and bad comments. Don’t hesitate to comment. I don’t care if its critical or if its supportive, just post it. Happy Sarcasm!
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