Where is the US economy headed?

@parados,

If you don't think that--

Quote:

I encouraged people to sell their gold.

is not synonymous with saying that the gold bubble is popping imminently what can I do about that? They mean the same thing to me. And in another post about the same time ci. did use the popping bubble image which isn't in the least surprising in view of his statement quoted here.

He advised going short on gold. Then he denied having done when gold climbed significantly. End of story.

0 Replies

@H2O MAN,

I don't think the expectation of most of the public that the rich will make some sacrifices of a relatively minor nature is a party issue. It is a moral issue. A matter of right or wrong.

Resistance to such sacrifice needs to prove that the wealth gap is in the interests of society and the public's perception of that is that it isn't. Although I do recognise that the public might be talking through its pockets as well. But talking as a majority.

0 Replies

@H2O MAN,

I don't think that is accurate. Clearly the solutiuon to our combined problem of high entitlement driven public debt and slow growth will require some of all the things the contending parties are demanding - cuts in discretionary spending, entitlement reform and some tax increases. The problem is the contending parties are playing a gotcha game with each other - The President refuses to consider entitlement reform and demands new permanent taxes to pay for short term stimulus. The Republicans demand entitlement reform and cuts in discretionary spending and refuse to discuss new taxes.

The truth is without entitlement reform there is no solution to our growing debt problem. On that basis I find the Republican position better. As for the rest, they are just throwing rocks at each other in preparation for the coming election.

1 Reply

The acting chairman of the FDIC urged the big banks to "turn on the lending fire hose." The big banks have recorded increased profits for the past 8 quarters. They have not, however, been inclined to make loans. The same can be said for other large private companies which are sitting on mountains of cash and are not investing.
The chairman argues that the banks cannot continue to increase profits unless they put their cash to work investing in something other then government bonds earning income at a very low rate of interest.
There were some interesting stats in the article I cribbed this from.
We have profits for the 2nd Qtr of 2011. That is followed by how much of those profits (in dollars and as a % of profits) is attributable to how much the banks reduced their Loan Loss Reserves (LLR) in the 2nd Q.
So JPMorgan/Chase reported profits of $5.4Bn of which $1.2Bn (22%) was done by cutting the LLR.
Citi: $3.3Bn Profit of which S2.2Bn (-67%) LLR
Wells Fargo: $3.9Bn; $1.1BN (-28%) LLR
BOA lost $8.8Bn which was after reducing their LLR by $2.5Bn.
The big banks - I don't know how many - currently have some $19Bn in LLR's as a group. That is down by more than 50% from a year ago as "non-current loans" have declined for 5 straight quarters.

1 Reply

@realjohnboy,

the banks around here all have very clever ad campaigns going.

they are just so friendly and nice...

and the credit card companies are offering 3% back in cash, if you charge your gas purchases.

every little bit helps, ya know...

0 Replies

@georgeob1,

spendius wrote:

I don't think the expectation of most of the public that the rich will make some sacrifices of a relatively minor nature is a party issue.

georgeob1 wrote:

I don't think that is accurate.

I have to disagree with both of you... I don't think you fully grasp what Obama is doing or what his plan is.

Obama hates America's free market economy and he is hell bent on replacing it with his big government, centralized economy.

Why don't we have those voters that constantly vote for the tax & spend politicians pay their fair share of taxes and more?

3 Replies

@H2O MAN,

A footnote in order to protect the wealthy the god fearing and the patriotic GOP are now planning on screwing the men and women who had placed their lives on the line to protect all of us and do away with the 20 years in the military pensions system.

1 Reply

@BillRM,

I have kind of heard about this idea. But I have never gone searching for more on it. Do you have a link to some credible source. Thank you.

1 Reply

@realjohnboy,

Quote:

I have kind of heard about this idea. But I have never gone searching for more on it. Do you have a link to some credible source. Thank you.

C-Span was talking about it today so no link.

1 Reply

@BillRM,

Quote:

C-Span was talking about it today so no link.

There is no plan, but money must be saved on the military retirement/healthcare side. THere are some drastic proposals floating around but where this ends nobody knows. My guess is that 10 years of war are too recent to allow for the massive cuts in pension that some are calling for, and that medical cost to retired will not go up the full 550% that some are calling for but they will go up at least 100%.

NYT has a popular story on this today, though it is poorly written.

2 Replies

@H2O MAN,

This was the complete paragraph H20--

Quote:

I don't think the expectation of most of the public that the rich will make some sacrifices of a relatively minor nature is a party issue. It is a moral issue. A matter of right or wrong.

I think you are remiss in only quoting the first sentence before venturing to disagree.

Mr Obama may well have analysed the situation as needing a big government, centralized economy. You can't keep treating a big government, centralized economy as a bogeyman without explaining why.

1 Reply

@H2O MAN,

Quote:

Why don't we have those voters that constantly vote for the tax & spend politicians pay their fair share of taxes and more?

There are reasons you know.

0 Replies

@hawkeye10,

Sorry Hawkeye but there are plenty of funds if we return to the 1980s or so tax rates and almost all of the funds needed it we just return to the pre-Bush tax rates.

Screwing our military men and women to keep the wealthy tax rates low is just another example of how in control and uncaring the wealthy are in this society,

0 Replies

@hawkeye10,

Here is a link .............to the plan/plans to screw our military men and women.

http://www.nytimes.com/2011/09/19/us/retiree-benefits-for-the-military-could-face-cuts.html

2 Replies

@BillRM,

Thanks, BillRM. The Times article is a good primer. I googled in "changes proposed military retirement" and found a few things.

0 Replies

@BillRM,

Obama is on record now that he thinks that the traditional military retirement system should be scrapped, he thinks that it should not take anything like 20 years to get vested and he wants to make is look more like a 401 k plan than the old style defined benefits plan that it is now. However this is a change that would not effect large numbers of military for over 20 years. His current plan has some increase in medical cost for retired and active duty families right now, but nothing on the order of what some are calling for.

Not sure how the Obama plan will go down with the brass, letting people walk at the 5 year mark with some retirement causes problems with keeping people around till 20 or 25 years, as soon as the best get a fab offer in the private sector they will be gone. Military does not pay very well, but the deferred pay is pretty good, this reform of the retirement system might vastly drive up the active duty pay required to keep good people. Another thing to keep around is that it takes a lot of years and a lot of money to train up a top notch soldier and leader, unlike the private sector who expects people to come out of college (that the firm paid nothing for) ready to produce the military needs to invest a wad of cash at the front end, so lots of short timer's is a big problem. The military weapons systems are now complicated, it takes several years to train people to use them well....do we really want to encourage walking after only 5 years??

It looks to me like a knee jerk reaction on the part of Obama as he sees in the military retirement system something that he mostly no longer sees in the rest of the society, so he assumes that the military system is outdated. The real problem I fear is what has always been feared about Obama, that he nether cares for nor understands the military and what is required to keep it strong.

http://www.armytimes.com/news/2011/09/military-tricare-benefits-cuts-obama-091911w/

1 Reply

@hawkeye10,

How are you going to keep military men and women in for 20 years with a 410 k that they can move to a job where no one is normally shotting at you and no big reward for staying in for two decades?

Hell they can leave if they love the military/combat life and get must larger salaries from private contractors that we are now using and that is hardly going to be cheaper.

Also now you only paid out funds at all to those who do the full 20 years and that is hardly the majority of military men and women so is it going to be even cheaper in the end?

1 Reply

@BillRM,

Quote:

How are you going to keep military men and women in for 20 years with a 410 k that they can move to a job where no one is normally shotting at you and no big reward for staying in for two decades?

Even if there is no shooting normally by the ten year mark the military has trained you so much you can take your skills to the private sector and collect at least twice the yearly take home pay that the military is currently offering.....people stay in the other ten-twenty years to collect all of that deferred income that Obama now wants to find a way to both cut and make it easier to collect (not need to stay the 20 years).

Again, the Obama plan is not fully fleshed out, he says leave it up to a commission, but it seems at first glance to be not a serious idea for change....it seems like change for change sake.

0 Replies

Quote:

Italy has had its sovereign debt rating cut by Standard & Poor's, the latest move in a deepening and continuing European debt crisis.

S&P cut its rating on Italy's long- and short-term sovereign debt rating to A/A-1 from A+/A-1+, adding that the outlook for the country was "negative".

It cited fears over Italy's ability to cut state spending and bring its finances in order.

Italy is currently trying to push through an austerity budget.

"We believe the reduced pace of Italy's economic activity to date will make the government's revised fiscal targets difficult to achieve," S&P said in a statement.

http://www.bbc.co.uk/news/business-14981718

Drip. Drip. Drip Drip. Drip......

0 Replies

Alan Blinder:

Quote:

The main culprit behind the exploding primary deficit is increased health care spending, which CBO projects to rise from 5.6% of GDP now to 10.4% by 2035.
There are two undisputed reasons for rising health care costs: the aging of the population (the minor part) and the rising relative cost of health care (the major part).
These two "problems" suggest two very different remedies. And that's where the political consensus begins to fray.

http://money.cnn.com/2011/09/18/news/economy/national_debt_blinder_hubbard/index.htm?hpt=hp_c1

This has been pointed out by many over the years, but neither party wants to hear it nor deal with it. History will write that Obama missed the boat with Obamacare, that he needed to primarily work on cost containment but instead he chose to work on getting more people insurance....basically a useless at best and counterproductive at worse exercise in getting more people better tied into our broken healthcare system. Of course at that particular time what Obama needed to work on was the economic crisis AKA JOBS, which he did not do...... It was a double **** up for Obama.

1 Reply

Where is the US economy headed?

Related Topics

Quick Links

My Account

able2know