Tab Clearing 2

A really interesting look at state budget deficits.

History of deficits and surpluses in the USA.




A look at, among other things, the difference between the headline unemployment numbers and the true, revised, numbers quietly released later.




 The general thought by professionals is that the recent jobs reports have been a little screwy.
Here's the head economist for Gallup explaining why.
Essentially, the labor force continues to shrink.  Explains apparently falling unemployment numbers, not even close to good news.
And here's Jack Welch explaining how stratospherically rapidly the economy would have to grow for the numbers to actually be real and be good news.

The economy is not in a free-fall. Oil and gas are strong, automotive is doing well and we seem to be seeing the beginning of a housing comeback. But I doubt many of us know any businessperson who believes the economy is growing at breakneck speed, as it would have to be for unemployment to drop to 7.8% from 8.3% over the course of two months.
The reality is the economy is experiencing a weak recovery. Everything points to that, particularly the overall employment level, which is 143 million people today, compared with 146 million people in 2007.

And finally, it turns out that America expects its rich to pay a larger share of taxes than ANY OTHER industrialized nation.  

"The United States is actually more dependent on rich people to pay taxes than even many of the more socialized economies of Europe. According to the Tax Foundation, the United States gets 45 percent of its total taxes from the top 10 percent of tax filers, whereas the international average in industrialized nations is 32 percent. America’s rich carry a larger share of the tax burden than do the rich in Belgium (25 percent), Germany (31 percent), France (28 percent), and even Sweden (27 percent)."

Tab Clearing

Long overdue.  Many of these lack deserve much more explanation.  Have fun.


http://cnsnews.com/news/article/us-governments-foreign-debt-now-47495-household

 Since January 2009, the total U.S. government debt held by foreign interests has climbed from approximately $27,653.29 per household to approximately $47,494.93 per household—an increase of about $19,841.64 per household.

 http://www.federalnewsradio.com//189/3085581/Pay-gap-between-government-private-sector-widens-to-34-percent

Depending on methodology, federal employees earn less, the same, or more than their private sector counterparts.  The divergent results seem to hinge one how you account for non-wage benefits.

A list of failed/failing federal green energy grants.

1. Evergreen Solar ($24 million)*
2. SpectraWatt ($500,000)*
3. Solyndra ($535 million)*
4. Beacon Power ($69 million)*
5. AES’s subsidiary Eastern Energy ($17.1 million)
6. Nevada Geothermal ($98.5 million)
7. SunPower ($1.5 billion)
8. First Solar ($1.46 billion)
9. Babcock and Brown ($178 million)
10. EnerDel’s subsidiary Ener1 ($118.5 million)*
11. Amonix ($5.9 million)
12. National Renewable Energy Lab ($200 million)
13. Fisker Automotive ($528 million)
14. Abound Solar ($374 million)*
15. A123 Systems ($279 million)*
16. Willard and Kelsey Solar Group ($6 million)
17. Johnson Controls ($299 million)
18. Schneider Electric ($86 million)
19. Brightsource ($1.6 billion)
20. ECOtality ($126.2 million)
21. Raser Technologies ($33 million)*
22. Energy Conversion Devices ($13.3 million)*
23. Mountain Plaza, Inc. ($2 million)*
24. Olsen’s Crop Service and Olsen’s Mills Acquisition Company ($10 million)*
25. Range Fuels ($80 million)*
26. Thompson River Power ($6.4 million)*
27. Stirling Energy Systems ($7 million)*
28. LSP Energy ($2.1 billion)*
29. UniSolar ($100 million)*
30. Azure Dynamics ($120 million)*
31. GreenVolts ($500,000)
32. Vestas ($50 million)
33. LG Chem’s subsidiary Compact Power ($150 million)
34. Nordic Windpower ($16 million)*
35. Navistar ($10 million)
36. Satcon ($3 million)*

  Another electric car company failure.

The administration of BHO is breaking the law and not issuing reports on the success/failure of the stimulus package. 

Welfare Waivers

This is an excellent summary of the history and current status of welfare reform efforts.  A well-researched article.  

Re the recent HHS memo watering-down the work requirement:

Now, however, welfare reform is potentially being undercut. In July 2012, the federal Department of Health and Human Service (HHS) announced that it would begin "encouraging states to consider new, more effective ways to meet the goals of TANF, particularly helping parents successfully prepare for, find, and retain employment." To that end, HHS issued a "guidance" memorandum expressing its willingness to unilaterally waive existing TANF rules "to allow states to test alternative and innovative strategies, policies, and procedures that are designed to improve employment outcomes for needy families."[2] The HHS memo undermines TANF's work rules by:

• Doing away with work participation rates in some instances;
• Extending periods of education and training;
• Liberalizing the counting of subsidized employment; and
• Discouraging one-time non-assistance payments.

The Obama administration said that the change was a response to requests by governors for more flexibility in administering the program and that it was not intended to "waive or dismantle" the work requirement.[3] But in some key respects, the HHS waiver is inconsistent with this statement. The language itself signals the agency's willingness to water down the program's current focus on work participation rates as the primary test of each state's compliance with the goals of welfare reform.

Assortment of Charts

Presented for your pleasure.  From HERE.

GM Bankruptcy V2.0

As a result of the VERY political way that the Federal bailout of GM was managed, to include the unusual bankruptcy process, GM now stands in jeopardy of losing everything.  Essentially the judge who oversaw the initial process may reopen the case because he feels information was kept or even hidden from him regarding the full disposition of old GM's full assets and liabilities. 

 If the case is reopened, all of GM's old liabilities and obligations come roaring back as well as an obligation to immediately repay the remaining taxpayer investment.  Repaying the taxpayer will consume almost all of GM's operating cash, leaving them in a very difficult situation.

Why is this such a mess?  It appears to many that b/c the FedGov was looking for short-term political gain they didn't take sufficient care with the process.

“They didn’t care about the company long-term,” risk analyst Whalen said. “The process was politically driven to be done as fast as possible, focused on securing short term support from the [United Auto Workers union].”
The allegation of union favoritism has dogged the Obama administration throughout the auto bailout. In addition to General Motors Canada’s debt, Treasury faced similar charges while handling the bankruptcy of Delphi, GM’s independent parts supplier.
“The government did a sloppy job with the bailout,” the bankruptcy expert said. “We have a fully functioning bankruptcy process based on centuries of common law, standard ways of doing things.”
“The federal government didn’t want pension plans to bear any costs associated with traditional bankruptcies … and now you’re faced with this.”

Again, this is the problem with crony/political capitalism.  Not only does government have a terrible record of picking companies that are unfit, but governments also have a terrible record of short-cutting market processes to deleterious effect. 
The full article is HERE.

When Government Decides...

Even giving the maximum benefit of the doubt, the green energy subsidy debacles of the past three years at best can be said to amply illustrate how difficult, nea impossible, it is for the government to correctly pick economic winners.

I'll say it again, because the government picks winners based at least in part on politics, decisions of who the government will support need not be based on any economic reality related to actual potential value created for/in the market.

Case in point continues to be Solyndra.  Now the IRS is saying that within a very short time of receiving the 1/2 billion Dollars of tax payer money, the Solyndra executives were conspiring to use the failing company - which they knew was failing - as a questionable tax shelter.

Article here.

Funny Polls

Polls like THIS are funny.  Sure, you can show that 79% of Americans believe that all Americans should pay income tax.  Allow me to point out that 79% is substantially higher than the percentage of Americans that actually DO pay income tax.  So there is some population of people who do not pay income taxes but believe that they, and everyone should. 

National Deficit

On October 1, 2012 additions to the National Debt for 2012 up to that date surpassed the total increase of the debt for ALL OF 2011.  In other words, the federal government accrued as much debt in nine months this year as they accrued over the whole of last year. 

Energy Expenditures

Lower-income households spend a much greater percentage of their income on energy than to higher-income households.  Therefore, an increase in energy prices will disproportionately hurt low-income families.  Over the past couple of years energy (and food) prices have been steadily increasing.  Where are the administration's actions to demonstrate that they actually, as they say, care for the poor and middle-income Americans?  They should be taking every options to reduce energy prices, not doing everything in their considerable power to increase energy prices. 

Chart from HERE:

Change in Incomes by Quintile

Look at this chart.   It's from here, investors.com.  Now, you cannot pin the cause on any one factor, but the reality displayed in the chart above certainly does put the lie to the idea that the middle class in this country saw any kind of a recovery in 2011. 

What does it mean? Briefly, in 2011 the 20% of households with the highest annual income were the only group of households to see their average income increase.  

Foreign Exchange Links

Two good links for those of you interested in International Currency Exchange. 

http://www.newyorkfed.org/markets/triennial/fx_survey.pdf

http://www.bis.org/press/p101201.htm

Presidential Impact

I found a really interesting way to assess how the policies of a president impact the nation.  You can get the full description here.  

And here is a chart that shows job growth overlaid with the impact of presidential policy. 








So what this essentially says is that in the period of time influenced by GW Bush's policies the number of employed Americans was increasing.  In the period of time exclusively governed by Obama's policies, the number of employed Americans has remained flat.  

Small Business Owners Feeling Queasy

According to this article, America's small businesses are not feeling particularly hopeful about this economy.  Key points:

• 67 percent say there is too much uncertainty in the market today to expand, grow or hire new workers.
• 69 percent of small business owners and manufacturers say President Obama’s Executive Branch and regulatory policies have hurt American small businesses and manufacturers.
• 55 percent say they would not start a business today given what they know now and in the current environment.
• 54 percent say other countries like China and India are more supportive of their small businesses and manufacturers than the United States.