Where is the US economy headed?

Good afternoon. We haven't checked the scoreboard on bank failures recently. There were 5 more on Friday, May 28th. 3 in FL (controlled by 1 holding co) and 1 each in NV and CA.
The total through May is 78 which is more than double what it was in the same period of 2009.
Losses in the commercial loan sector are largely to blame.
The banks taken over on Friday had assets on their books of some $1.5Bn. Remember that, for a bank, an asset is a loan. Deposits by customers are a liability on the books. The assets are declining in value, generally.
The FDIC will take a hit on these closings estimated at $317M.

1 Reply

@realjohnboy,

The more than doubling of the failures of commercial banks is largely caused by the increasing Fan & Fed unsecured loans and on extreme federal borrowing.

1 Reply

@ican711nm,

Anyone have any recent news on the Fannie and Freddie bonuses? The following article from January of this year. It does not seem to me that the Democats care at all about their Fannie and Freddie buddies ripping us off, nor do they care to investigate the fraud and mismanagment of Fannie and Freddie, not at all to this day have they done anything. And these two organizations are two of the biggest suspects that helped start this entire housing / financial meltdown. I see this simple fact as one of many indicators of Democratic Party failure and utter mismanagement starting at the top.

http://www.businessandmedia.org/articles/2010/20100106131914.aspx

"Networks Downplay $42 Million in 'Outrageous' Bonuses, 'Unlimited' Bailout of Fannie, Freddie
Journalists critical of pay at bailed out banks muster only 175 words to report compensation of Fannie execs.

By Julia A. Seymour
Business & Media Institute
1/6/2010 2:28:05 PM

The network news media cheered when Obama called for restrictions on CEO pay or bonuses that, according to reporters, exemplify the Wall Street “greed” that toppled the American economy.

But when $42 million in cash compensation packages were announced on Christmas Eve for Fannie Mae and Freddie Mac executives, the networks couldn’t muster any anger toward the highly connected groups. Although Fannie and Freddie were two government-sponsored enterprises whose excessive risk taking contributed significantly to the housing crisis, the networks barely reported the story at all."

1 Reply

@okie,

Your post, okie is additional evidence that the Odem (i.e., Obama democrats) are lying thieving gangsters working to reduce our Liberty, our Constitutional Government, and our Capitalist Economy.

Quote:

http://www.businessandmedia.org/articles/2010/20100106131914.aspx

"Networks Downplay $42 Million in 'Outrageous' Bonuses, 'Unlimited' Bailout of Fannie, Freddie
Journalists critical of pay at bailed out banks muster only 175 words to report compensation of Fannie execs.

By Julia A. Seymour
Business & Media Institute
1/6/2010 2:28:05 PM

The network news media cheered when Obama called for restrictions on CEO pay or bonuses that, according to reporters, exemplify the Wall Street “greed” that toppled the American economy.

But when $42 million in cash compensation packages were announced on Christmas Eve for Fannie Mae and Freddie Mac executives, the networks couldn’t muster any anger toward the highly connected groups. Although Fannie and Freddie were two government-sponsored enterprises whose excessive risk taking contributed significantly to the housing crisis, the networks barely reported the story at all."

We shall lawfully remove the Odem from our federal government.

0 Replies

Good afternoon.
As we barrel into the the election season, it is inevitable that some candidate will be asked about an increase in Social Security (SSAE) retirement benefits.
There was not increase in 2010 and it looks more than likely that there not be one in 2011 either. That is going to make a lot of people angry (although the official announcement may or may not come out before November 2nd.
The Cost of Living Increase (COLA) is based on, ready for this, the Consumer Price Increase for Urban Wage Earners and Clerical Workers (CPI-W) for the 3rd Quarter of the previous year.
Here are the numbers:
3rd Quarter CPI-W for 2007-
July, 2007 ............ 203.700
August, 2007 ........ 203.199
September, 2007 .. 203.889
3rd Quarter Average - 2007 ...... 203.596

3th Quarter CPI-W for 2008-
July, 2008 ............ 216.304
August, 2008 ........ 215.247
September, 2008 .. 214.935
3rd Quarter Average - 2008 ...... 215.495

That was a 5.8% increase from 2008 over 2007. SSAE benefits went up 5.8% effective January, 2009.

3rd Quarter CPI-W for 2009-
July, 2009 ............ 210.526
August, 2009 ........ 211.156
September, 2009 .. 211.322
3rd Quarter Average - 2009 ...... 211.001

That was a decline from 2009 vs 2008. SSAE benefits can not, by law, be reduced. But it did mean no increase beginning in January, 2010.

This is where the ticking bomb is buried.

1st Quarter CPI-W for 2010-
January, 2010 ..... 212.568
February, 2010 ... 212.544
March, 2010 ....... 213.525
1st Quarter Average - 2010 ...... 212.879

The 1st Quarter - 2010 is above the 3rd Quarter -2009, and in April, 2010 the index rose to 213.598.
But the comparison in determining the 2011 SSAE COLA will not be between 2010 and 2009, but between 2010 and 2008!
It seems highly unlikely that the CPI-W will get to the 3rd Quarter - 2008 average of 215.495.
Hence, no increase in SSAE unless the Congress and the Administration change the rules.

1 Reply

@realjohnboy,

I am not seeing the problem here. A lot of people to include me suspect that the inflation index number is not very representative of most peoples actual experience, but that is not what you are saying. If the cost of living does not go up and people on fixed government support do not get an increase then no harm has been done. Yes, in an inflationary environment having the cola adjustment lag actual increases by as much as a year does hurt, but not much until we get into hyper inflation. At that point the current system fails.

1 Reply

@hawkeye10,

Fair enough, Hawkeye. I threw out a lot of numbers, but I did say in the 1st line that I wonder whether this will become an election issue heading up to November.
You will recall that when the COLA for 2010 turned out to be zero, there was a half-hearted attempt by Congress to give retirees a one-time $250 payment. It went nowhere then, but if it is zero again for 2011...

1 Reply

@realjohnboy,

Quote:

that when the COLA for 2010 turned out to be zero, there was a half-hearted attempt by Congress to give retirees a one-time $250 payment. It went nowhere then, but if it is zero again for 2011...

Congress is having trouble agreeing to pass even routine spending increases now, looking at Europe they have finally figured out that the charge card is about used up. You might have noticed that the defense department sees the writing on the wall, that getting money out of Congress is now much more difficult than it has been since 9/11, even though we are still at war. Gates has ordered all services to cannibalize their budgets and find $60 billion that can be used for war fighting, because Congress will not fund it. When the defense department starts such deep cuts after having gotten most everything they have wanted for ten years we know that the landscape has changed.

Not only will there be no increases for SS, everyone in American now needs to prepare themselves for a combination of tax increases and government spending decreases. The scale will be major. Whining about it will be to no avail, the Federal government has used up its ability to borrow money.

We have a hangover, we are still in a drug induced haze, we are hungry for Breakfast but can't find any money in our pockets, and we are not too sure of where we are or how we got there.....

It is morning in America..

1 Reply

@hawkeye10,

I thought this was interesting and humorous, as well as illustrative of what could happen soon here in the states. During a recent family reunion, some relatives from the UK were telling us about this, and so I did a search and found the info. on it.

http://www.sbs.com.au/news/article/1259367/Labour-treasurer-leaves-joke-note

"David Laws, newly appointed chief secretary to the Treasury in Prime Minister David Cameron's new coalition government, described to reporters how he had been left the note by his predecessor Liam Byrne.

"When I arrived at my desk on the very first day as chief secretary, I found a letter from the previous chief secretary to give me some advice, I assumed, on how I conduct myself over the months ahead," Laws recalled.

"Unfortunately, when I opened it, it was a one-sentence letter which simply said 'Dear Chief Secretary, I'm afraid to tell you there's no money left', which was honest but slightly less helpful advice than I had been expecting."

1 Reply

@okie,

That's a bit out of date now okie. Mr Laws was outed after 17 days in post as having claimed £40,000 off the taxpayer to pay his secret homosexual lover for the rent of a room in the latter's house. He resigned of course and has been replaced as Chief Secretary to the Treasury by a chap called Danny Alexander who hardly anybody had ever heard of before and who has as much experience of macrocosmic economic management as your average duck-billed platypus. We have however been assured that he's a quick learner.

1 Reply

@spendius,

I knew that, Spendi, about Mr Laws. I follow the BBC regularly and like it. A customer of mine, though, went into a rant about what she perceived as a strong anti-Israel bias.
Thoughts?

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THE RECENT ODEM TOTAL CIVIL EMPLOYMENT RECOVERY IS VERY SMALL COMPARED TO WHAT THE UNEMPLOYED REQUIRE. SO FAR, 95% OF THAT INCREASE IS AN INCREASE IN FEDERAL GOVERNMENT JOBS THAT EXCEPT FOR THEIR INCOME TAXES WILL BE PAID FOR BY PRIVATE INCOME TAXES AND IRRESPONSIBLE FEDERAL BORROWING.

Quote:

ftp://ftp.bls.gov/pub/suppl/empsit.cpseea1.txt
Year………………………..USA Total Civil Employed
...
2001………………..............136,933,000 [BUSH43 2001 TO 2009]
…
2007...........................146,047,000
…
2008:
August........................ 145,273,000
September.................... 145,029,000
October....................... 144,650,007
November................... 144,144,000
December.................... 143,338,000

2009: [OBAMA 2009 TO ?]

January.................... 142,221 ,000
February................... 141,687 ,000
March......................140,854,000
April...................... 140,902,000
May........................ 140,438,000
June....................... 140,038,000
July....................... 139,817,000
August..................... 139,433,000
September................ 138,768,000
October.................... 138,242,000
November................... 138,381,000
December................... 137,792,000

2010:
January (3)................ 138,333,000
February................... 138,641,000
March...................... 138,905 ,000
April......................... 139,455,000

1 Reply

@ican711nm,

ican, the pertinent question is - by the time Obama is done, will there be anybody left in the private sector to pay for all the people working for the federal government, plus pay for all the money they are spending?

1 Reply

@okie,

Okie, if Obama is not impeached and removed prior to mid 2011, there will unquestionably be too few people working "in the private sector to pay for all the people working for the federal government, plus pay for all the money they are spending."

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How is the impeachment effort going?

1 Reply

@realjohnboy,

Throughout the bush years, there were impeachment petitions galore. I have heard nothing of an impeach Obama campaign. Why nothing got off the ground vis a vis bush is beyond me.

1 Reply

@plainoldme,

Politicians dont mess with one another because it might be thier turn next. Kind of like doctors refusing to turn in the bad doctors. Re Bush, not Obama.

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YES, THERE ARE CURRENT EFFORTS TO IMPEACH OBAMA. HERE'S ONE SUCH EFFORT.

Quote:

http://www.impeachobama2010.org/index.html
IMPEACH OBAMA 2010Search
SIGN THE PETITION Resourcesview cart

Welcome
The goal of this website is to build a petition with more than 1,000,000 signatures, in support of Impeaching President Obama. Your comments from the petition will be used to draft Articles of Impeachment. The petition and Articles of Impeachment will be presented to Congress immediately following the 2010 election. We all have from now until the 2010 election to elect or persuade enough Congressmen and Senators so a majority will support Impeachment.

THE PETITION STATES: Article 2, Section 4, of the U.S. Constitution specifies that "The President, Vice President and all civil officers of the United States, shall be removed from office on impeachment for, and conviction of, treason, bribery, or other high crimes and misdemeanors." WE, THE UNDERSIGNED, AFFIRM THAT WE ARE LEGAL CITIZENS OF THE UNITED STATES OF AMERICA. WE SUPPORT THE IMPEACHMENT OF PRESIDENT BARRACK HUSSEIN OBAMA.
This petition alleges financial mismanagement on a scale so large it has never been seen in the history of the world. This petition also alleges numerous acts to undermine, contradict and supercede the Constitution of the United States. This is the same Constitution that President Obama swore an oath to protect and defend. Our individual statements in support of this petition are included with this petition.

TO SIGN THE PETITION: Select "Sign the Petition," on the top left portion of this page. Making a $2.00 payment self-verifies your name and address on the petition and allows you to enter comments that will be used to draft the Articles of Impeachment. For more information see "About Us."

2 Replies

@ican711nm,

However, there are no serious efforts to impeach Obama.

Cycloptichorn

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This is utter rot as GWB caused all the economic mess and Obama is trying to clean up the mess. It is like blaming the cleaning maid for her dirty uniform.

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Where is the US economy headed?

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