Culinary Accounting; Cookin’ the Books!
Good Morning all of you good Middle Class Americans out there; stand by for a rant!
Greg Easterbrook said, “Torture numbers and they will confess to anything.” Barrack Obama said, “Americans don’t torture.” Either Barrack Obama doesn’t count number-torturing as a crime or his nose is growing.
Let’s talk about unemployment numbers. . . real unemployment numbers. The announcement that the unemployment rate declined slightly to 9.4 percent in July while only 247,000 additional jobs were lost has been greeted as good news. Really?
How is it possible for the unemployment rate to essentially remain unchanged when 247,000 jobs have been lost? The reason is simple — the number of people who stopped looking for work rose dramatically. Six hundred thirty-seven thousand additional people no longer consider themselves looking for work.
If we include the normally counted number of unemployed as well as those who have recently given up looking for work and those who have taken a part-time low paying job because they can’t find full-time work, the implication is that the unemployment rate for July would be at 16.3 percent! And our president stood in his cocky stern manner and announced that employment is getting better on his watch?
What about the cash for clunkers program? To being with, what right does the federal government have to give $4500 of our tax money to each person who has a junk car to trade in? What? You say the federal government owns the car business and is using our money to subsidize their business!
Why would we ever accept such a ridiculous expenditure of our precious tax dollars as cash for clunkers? So is it really a good program for anyone other than the federal government? No! Most of these people trading in their clunkers for your tax money owned their older cars outright and now they own a big old hairy car payment, higher taxes, higher insurance costs, higher license costs, and an asset that is depreciating faster than Barrack Obama’s ratings.
What about our government giving new home buyers $8000 as down payment assistance? What right do they have to dole out our tax money for broke people to buy new homes? I have had two of my real estate friends say that if you aren’t in the first-time-home-buyer loop, you are out of the loop all together as the federal assistance program represents the balance of home buyers today. But then, the federal government also now owns the mortgage companies.
Wasn’t the housing bubble created by loaning people a 100% or more on their home purchases? Isn’t this a re-run of that same program? Well, not exactly, the $8000 is a gift from the federal government that won’t have to be paid back. Interestingly enough, the federal government doesn’t have any money to give as gift without taking it from someone else.
Even more interesting is that most of those taking advantage of our newest housing scam are in an income bracket where they pay little to no federal taxes. This newest give away is insane! Talk about torturing numbers, if it were a real crime Obama would get life without the possibility of parole!
So what about the reports that real GDP losses are slowing? And that our economy is getting better every day under the steady hand of Barrack Obama and company. Please read this excellent article by fellow blogger Pete Murphy to shed a little light on that subject. http://petemurphy.wordpress.com/2009/08/01/stimulus-spending-masks-huge-decline-in-2nd-qtr-gdp/
The current government daylight heist is our healthcare. The definition of Communism is, “A system of government in which the state plans and controls the economy and a single, often authoritarian party holds power, claiming to make progress toward a higher social order in which all goods are equally shared by the people.” You decide how or if that definition fits our young president.
It’s all smoke and mirrors aimed at an ulterior motive, directed, produced, and copy written by the best government that money can buy. Its time to make some changes and I’m not talking about the changes that Obama promised.
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All these government incentives are insane. I thought the U.S. was the champion of the free market economy. These programs are certainly not conducive to any sort of free market, any more than the “health care reform” will be “free,” either cost-wise or liberty-wise.
In a nutshell, we’re swiftly moving toward a totalitarian, fascist system.
For a lucid explanation of the fallacy of the “cash for clunkers” program, read this:
http://www.321gold.com/editorials/saville/saville081009.html
Dave - Erstwhile Urban Wanderer
Dave,
Great remarks and a good link.
Government has taken over, let there be no doubt about that! They are controlling the auto, home, and banking businesses along with their partners on Wall Street. Middle America walked the proverbial plank while being promised a swim.
Mike,
You worry too much. Our Esteemed Treasury Secretary took care of all these problems on Friday. He’s going to increase the USA’s credit limit. Simple enough, isn’t it? You can’t be broke as long as you have your credit limit increased and a number of checks left in the check book, right?
Timothy Geithner has asked Congress to increase the $12.1 trillion national debt limit.
“It is critically important that Congress act before the limit is reached so that citizens and investors here and around the world can remain confident that the United States will always meet its obligations,” Mr. Geithner said
After all; “Congress has never failed to raise the debt limit when necessary,” Mr. Geithner said.
Hmmmm……… Maybe, just maybe, if Congress would lower instead of raise the debt limit. Nah, that’s crazy…….
http://online.wsj.com/article/SB124970470294516541.html
It matters little what the debt ceiling is at this time. The law of diminishing returns is a blood relative of the exponential function. We are close enough to this event materializing that defining it adds little to the harsh reality that will result. Besides, the grand stand seats we all have for the coming events will illustrate much more colorfully than a written definition ever could. -bb
Mike, I am glad you brought up the unemployment numbers. I have been ranting to everyone I know this weekend about losing 247,000 more jobs but the percent of people unemployed decreased. This reminds me of Benjamin Disraeli’s famous quote “There are three kinds of lies: lies, damned lies, and statistics.”
As far as the cash for clunkers goes, it a sham, but if I had an extra 5 grand so I could pay cash, I would by a cheap new car such as the Nissan Versa. This might be one of the few times buying a new car makes more sense than buying a used one.
Here’s some math to do that some how works in that 10 mile radius known as Washington D.C. but I’m hard pressed to make it work in the real world.
1. Government spending through July of 2009 has increased by $530 billion, which is 21 percent over the same period in 2008.
2. Tax revenue for the first three quarters of 2009 has fallen by approximately $350 billion, or 17 percent compared to the same period last year.
3. This year the deficit is at $1.3 trillion and is projected to reach $1.8 trillion by the end of the fiscal year, Sept. 30. The deficit in 2008 reached $455 billion, which was a record at the time.
4. As Mike pointed out “How is it possible for the unemployment rate to essentially remain unchanged when 247,000 jobs have been lost? The reason is simple — the number of people who stopped looking for work rose dramatically. Six hundred thirty-seven thousand additional people no longer consider themselves looking for work. ”
The only thing it adds up to me is a broken economy and an almost worthless ‘Fiat’ currency. Here’s a comparison of the 1913 dollar Pre-Federal Reserve all they way up to today. It takes over $21.00 to match the buying power of $1.00 back in 1913. I’d like to compare the average wage in 1913 to the average wage in 2009.
http://www.infoplease.com/ipa/A0001519.html
I found a chart that shows average income from 1913 to 2006.
http://www.visualizingeconomics.com/2008/05/04/average-income-in-the-united-states-1913-2006/
In a nutshell the average income in 1913 was $15,000 and in 2006 it was about $45,000. So in that span incomes went up 3 times. However, in that same span the value of the dollar tumbled to the point that it too $19.00 to buy what you could with $1.00 in 1913.
1913 pre Fed, pre credit card, pre car loan, pre service economy, and rooted firmly on the gold standard and sweat equity.
Thank goodness “Little Timmy Geithner is raising the debt limit; for a minute there I thought we were in trouble!
We must remember that literally hundreds of thousands of formerly self employed people are not eligible for unemployment benefits. As we wind into fall and winter and the few remaining construction projects shut down; don’t look for the Christmas rush to save the day.
One of my friends mentioned this morning that over the weekend, he and his wife walked through a craft-fair at a local festival. He noted that there was not one thing represented that they actually needed.
Here’s a rerun from Gerald Celente regarding Christmas, “Putting food on the table will be more important than putting gifts under the tree.” http://www.youtube.com/watch?v=TqW1-aA5aMg&feature=related
The BLS numbers scam was concocted by the spin doctors of past administrations so they can put a smiley face on most any downturn. And the phony concern shown by the smug, smirking, puffy pundits on financial talk shows passes for analysis. They know the economy is in a downward spiral. Yet, they shamelessly tout a quarter million jobs lost as a green shoot. A quarter million jobs lost in one month is a historically high number. Yes, it sucks less than 3/4 million jobs lost in a month but it’s still a sign of employment going around the bowl and down the hole.
Meanwhile, the ignored long term unemployed accumulate. Its OK for now because many still have a car that runs, a roof over their head and a member of the family still working. But in time, the car will break down, the roof will leak and the last employed family member will lose their job. I heard one smug pundit poo poo the notion that this is a depression. He wondered where are the pictures of the dust bowl? They showed a picture of Dorothea Lange’s Migrant Mother on the screen. http://en.wikipedia.org/wiki/Great_Depression
Of course, there was no rebuttal then. But it goes like this. Images like that did not instantly appear in 1929 after the stock market crash. It took about 6 or 7 years of hardship to weather that once pleasant face. That pundit may get the opportunity to experience that process himself.
I have been reading a blog from Bill Clinton’s former labor secretary, Robert Reich. He made a statement that I found very interesting, “don’t be lured into thinking we’re ever going back to where we were. Most of the jobs that have been lost are never coming back.” I am really surprised to see a former politician speak so candidly. You know things must be bad when a Washington insider makes a statement like this.
Here is a link to his blog, http://robertreich.blogspot.com/2009/08/new-employment-numbers-things-are.html.
Bobcat and Hotrod,
Your points are well taken. After the recession of the early to late 80s, it took six long years for unemployment rates to return to 5%. This time around it will NEVER drop to 5% in real numbers. The debts are too high, the work force is too large, and the resources are hammered thin. We have reached the point of diminishing return.
You are correct with the fact that we have reached the point of deminishing returns. This was very predictable.
Also, how many other communist countries can you name who have full employment or even close to it? As our population continues to grow in step with our growing debt and totalitarian rule, there will be far more unemployeed citizens than employeed ones. Very little imagination or speculation is required to come to this conclusion. -bb
Here’s a sobering look at the employment outlook. It’s titled “Rise of the Part-Timer, Fall of the Labor Force”
http://seekingalpha.com/article/154865-rise-of-the-part-timer-fall-of-the-labor-force?source=email
George,
As the numbers indicate, part timers are becoming the norm. The obvious issue is that part-time income doesn’t support full time living when monetary inflation is driving costs.
Once more, I suggest that we all hunker down and get the “live simple” idea honed to perfection, which by the way, you have done a remarkable job of accomplishing.
It’s also apparent that part time incomes don’t support a giant ever growing federal government.
The evidence that has been provided in just this one posting and the related comments are irrefutable, by all except our federal government.
hmmmmm……..
We filipinos love Barack Obama. we think that he would be the best president of the United States and that he always makes wise decisions when it comes to foreign policy.
Cris,
Then why doesn’t he stop the wars and bring home the troops?