What is going on is actually rather simple. Big corporations have done what they love to do with big government; get in bed together. Unfortunately, it’s us, as the common taxpayers, who will have to foot the bill for this love affair.
Treasury's archives
Healthcare Reform Eve: A Pork Fest of Corporate Welfare
under: Game Theory, Individual v. Collective, Live and Learn, Obama Says, Treasury, Trust
Tags: Barack Obama, Billy Tauzin, biologics, Bloomberg, Cigna, CNBC, Constitution, corporate welfare, corruption, Democrats, discounted cash flows, Dow Jones, employeer mandate, FDA, healthcare, healthcare reform, House of Representatives, individual mandate, insurance companies, Johnson and Johnson, LA Times, lobbyists, Medicare, Medicare Part D, Mike Huckman, Nancy Pelosi, New York Times, Obamanomics, patents, PhARMA, pharmaceutical companies, reconciliation, Republicans, Senate, Slaughter Rule, special interests, stock market, Tim Carney, U.S. Constitution, UnitedHealth Group
CBO Projects Obama’s Budget Would Add $9.8 Trillion of Debt
The most frightening element of this ten-year forecast is that an estimated $5.6 trillion of the debt would be interest expense. Yes, that’s right, interest.
Cities Printing Their Own Money
The Federal Reserve and Treasury have pumped an ungodly amount of money back into the economy, which raises serious concerns about future inflation, but for now, much of that money is stuck in the banks and velocity is extremely low.
So what have some city governments and businesses done to combat this? Well, they’ve decided to print their own money. MSN Money highlights one such example:
The COMPLETE Fiscal Picture of the U.S.
There’s a lot of talk out there about green shoots, economic recovery and stabilization. Most people aren’t predicting giant leaps in GDP anytime soon, but some are predicting modest global GDP growth between 2-4 percent for 2010. As Greece goes bankrupt and looks to its EU compatriots for help, remember they’re not the only nation on the belly up path. And from a United States perspective, here are the numbers you should be hearing on a daily basis, but aren’t. It isn’t just a matter of restoring economic growth and reducing unemployment. Surprise, surprise: debt, unfulfillable promises and easy money have consequences. Unfortunately, we have plenty of all three:
Bernanke’s Plan For Tighter Money
We haven’t seen inflation on the whole during the financial rescue efforts, despite the Federal Reserve’s easy money policies. If you wanted to cherry pick certain assets, the argument could be made that $140/barrel oil, during a recession, coinciding with a dump of liquidity on the economy, could be related. Global oil transactions are denominated in US dollars. It is hard to imagine any other factor being solely responsible for such a historic, and counterintuitive, rise in petroleum during a recession.
under: Deficits, Dollar, Energy, Federal Reserve, Game Theory, Individual v. Collective, Live and Learn, Taxes, Treasury, Trust
Tags: Ben Bernanke, easy money, Fannie Mae, financial crisis, fractional reserve banking, Freddie Mac, housing, inflation, real estate, stagflation, tight money, Treasurys, velocity of circulation
“Volcker Rule” Both Practical, and Admission
If you didn’t think there was a wink and a nod relationship between large banks and the feds, the “Volcker Rule” should serve as an acknowledgment. Because lending and credit is so crucial to the economy, financial institutions know the government will backstop them during crisis mode in the industry.
under: Deficits, Dollar, Federal Reserve, Game Theory, Individual v. Collective, Live and Learn, Obama Says, Taxes, Treasury, Trust
Tags: bailout, Barack Obama, financial crisis, financial sector, government safety net, Great Depression, moral hazard, Paul Volcker, Savings and Loan Crisis, Senate Finance Committee, Volcker Rule
Federal Budget Forecast Off by a Mild 41%
Chris Edwards of the Cato Institute took a little trip back in time to check the government’s budget accuracy… they get an F minus. As Walter Williams points out here, this is nothing new, but in 2001, the Bush Administration forecasted that by 2010, the Federal government would have a $2.71 trillion dollar budget. According to Obama’s budget estimate, it will be $3.83 trillion dollars! The following chart shows the real budget vs. the forecast.
Tim Geithner Discusses Bailouts and Government Intervention
Treasury Secretary Timothy Geithner discusses the burdens of his position, why he felt it was necessary to bailout the financial system and the paternal role taken by the federal government:
under: Deficits, Dollar, Federal Reserve, Game Theory, Individual v. Collective, Live and Learn, Taxes, Treasury, Trust
Tags: bailout, Barack Obama, Ben Bernanke, bubbles, credit default swaps, derivatives, George Bush, Henry Paulson, home loans, housing, stimulus, Timothy Geithner, toxic debt, Treasury, underemployment, unemployment
Fed Posts Record Profits
The question is, can the Fed take enough money out of the economy without sending us back into a severe recession, or will the excess money lead to high inflation. Personally, I’m predicting some pretty vicious stagflation is coming our way.
Obama’s Cabinet is Bare in Business Experience
In terms of private sector experience, the cupboard is bare within President Obama’s Cabinet. Take the following graphic with a grain of salt. It came from a recent JP Morgan report in which I cannot vouch for the author’s research practices, or ideology. The author took all presidential administrations since 1900, looking at the private sector experience of 432 Cabinet secretaries whose activities touch most on the private sector. Here are the findings:
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