Robert Reich, former Labor Secretary, for President Clinton predicts that CEOs of financial and other corporations receiving taypayer bailout money will not make the necessary structural changes expected by Congress and the American people. See http://robertreich.blogspot.com/2008/12/debate-to-come-over-wall-street-autos.html
Hopefully Reich is wrong but sadly I suspect he is probably right in his assessment that financial institutions and certain other corporate CEOs will continue with the status quo.
As a long-time investor in stocks I am appalled by the flagrant mismanagement of owner's equity that has taken place by cavalier CEOs and other "trust" custodians of some of our largest and most trusted corporations, specifically those in the financial sector. I am also appalled by the excuses being made by high-paid fund managers and business anchors with their trite comments and celebratory references to "Milton Friedman's" theory of free market capitalism. Free market capitalism does not exist and never has. Taken to its truest form it runs counter to democracy. The moral hazard clause is their catch all answer to the inevitable greed and corruption that quickly creeps in when the fox is left guarding the hen house and as we have all seen the moral hazard clause has now been deferred to us, the taxpayers.
Unlike "the most productive members of society," aka CEOs and other corporate rock stars, many of us have not bought more house than we can afford, leased cars we had no business driving nor lived beyond our means. Instead we acted responsibly and funded our own pensions in 401k and 403b plans (with help from financial institution lobbyists who helped to dismantle the traditional pension plans and convince the government to endorse the alternative through complicated tax schemes), saved for our children's college, set up health savings and daycare accounts only to have the funds stolen and/or squandered by the very people who had a fiduciary responsibility to act appropriately with their management.
I am outraged! I certainly hope that our new president is not inculcated by the very people that created this mess and instead is able to transcend "the system" and work for Main Street.
Thursday, December 25, 2008
Wednesday, December 24, 2008
President Obama Should Implement the Pickens Plan
T. Boone Picken's Plan to create a wind-power generation corridor to provide power to our electrical grid and redistribute the natural gas the power companies currently use to power trucks should be implemented by President-elect, Barack Obama and incorporated into his national infrastructure plan.
Getting America off of its 70% dependence on foreign oil is the key to our future prosperity. Energy independence, infrastructure and the design and development of next generation transportation products could be impetus for creating the economic driver which will add to the prosperity of our nation and grow our economy well into the latter part of this century.
Adopt the Pickens Plan. Let's find a way to re-energize our independence and celebrate our freedom!
Getting America off of its 70% dependence on foreign oil is the key to our future prosperity. Energy independence, infrastructure and the design and development of next generation transportation products could be impetus for creating the economic driver which will add to the prosperity of our nation and grow our economy well into the latter part of this century.
Adopt the Pickens Plan. Let's find a way to re-energize our independence and celebrate our freedom!
Friday, December 19, 2008
President-elect Barack Obama's Infrastructure Plan is Good for America
President-elect, Barack Obama's plan to rebuild America's infrastructure is the type of economic stimulus that America needs right now. Our country saw its greatest growth in the manufacturing of transportation products. The locomotive, the ocean liner, the jumbo jet and the automobile provided more good paying manufacturing jobs than any other segment of our society directly and indirectly.
As the computer age morphed into the information age American efficiency became the world standard accelerating the learning curve and reducing the number of workers required to run the old technology industries.
As I wrote in several previous pieces including 3 Pillars of Prosperity for America, it is time for a paradigm shift in our transportation products, transportation systems, and energy products. Building the 21st-Century transportation products, the infrastructure needed to support them, and alternative energy sources to become energy independent is the key to our future prosperity. Not only is it the right thing to do for our global environment it is the right thing to do for the American people as well.
If done right this program will ignite manufacturing, construction, telecommunication, green energy, and a host of related services especially in education and training.
Regardless of one's political affiliation it is time for all of us to get behind the incoming president and help him repair our battered economy and ensure a better America for our children.
As the computer age morphed into the information age American efficiency became the world standard accelerating the learning curve and reducing the number of workers required to run the old technology industries.
As I wrote in several previous pieces including 3 Pillars of Prosperity for America, it is time for a paradigm shift in our transportation products, transportation systems, and energy products. Building the 21st-Century transportation products, the infrastructure needed to support them, and alternative energy sources to become energy independent is the key to our future prosperity. Not only is it the right thing to do for our global environment it is the right thing to do for the American people as well.
If done right this program will ignite manufacturing, construction, telecommunication, green energy, and a host of related services especially in education and training.
Regardless of one's political affiliation it is time for all of us to get behind the incoming president and help him repair our battered economy and ensure a better America for our children.
Wednesday, December 17, 2008
Help Needed for the Big 3 Now!
Congress should be dragged in by their ears and locked into the room until they get this bridge loan approved!
It is unconscionable that a blank check was given to the financial institutions in a scheme devised by Treasury Secretary, Hank Paulson. It received congressional approval only under duress as Wall Street held an economic gun to Washington's head as the stock market melted down in full color on the nightly news and red ink poured out of countless peoples' 3rd quarter 401k statements.
Sadly we have only begun to see the abuses of these funds as the first $700 billion was scooped up faster than cheap televisions at Walmart on Black Friday. AIG's CEO is a master of splitting words by agreeing not to use the funds for executive "bonuses" but finding no problem using them for executive "retention payments." $140 billion squandered with little oversight but no money to save up to 3 million jobs in the automotive industry, one of the biggest drivers of the last century? Where's the outrage?
I'm sickened by the thought that my tax money can be used to help an AIG executive buy an new yacht with their "retention payment" but it cannot be used to keep 3 million of my neighbors working. Does anyone honestly believe that eliminating a large number of jobs is going to bode well for the rest of the working people?
It is unconscionable that a blank check was given to the financial institutions in a scheme devised by Treasury Secretary, Hank Paulson. It received congressional approval only under duress as Wall Street held an economic gun to Washington's head as the stock market melted down in full color on the nightly news and red ink poured out of countless peoples' 3rd quarter 401k statements.
Sadly we have only begun to see the abuses of these funds as the first $700 billion was scooped up faster than cheap televisions at Walmart on Black Friday. AIG's CEO is a master of splitting words by agreeing not to use the funds for executive "bonuses" but finding no problem using them for executive "retention payments." $140 billion squandered with little oversight but no money to save up to 3 million jobs in the automotive industry, one of the biggest drivers of the last century? Where's the outrage?
I'm sickened by the thought that my tax money can be used to help an AIG executive buy an new yacht with their "retention payment" but it cannot be used to keep 3 million of my neighbors working. Does anyone honestly believe that eliminating a large number of jobs is going to bode well for the rest of the working people?
Saturday, December 13, 2008
The Cannibalization of America
And the cannibalizing of America continues...
It is sadly ironic that people are actually promoting the idea of destroying the health and pension plans of the remaining private and public employers that offer them at the same time that many are screaming for national health insurance and fixing social security.
One of the CNBC anchors was ridiculing the UAW workers yesterday talking about their "free" health care saying they (the anchors) don't get any free health care. Really? Do they actually pay 100% of the cost of a non group health insurance plan for themselves and their families? I doubt it. They are either hypocrites or purposely ignorant in their statements. I'm sure the anchors $$$$salaries are really in-line with the Average Joe as well.
Another lie that has permeated the media and cyberspace is this notion that the average UAW worker makes $73 per hour. This figure is a shop wrap rate. This figure is akin to saying the average plumber charging $125 per hour is making $125 per hour him or herself. It simply is not true. When I worked in manufacturing over 15 years ago the Fortune 50 company I worked for had a wrap rate over $125 per hour. Competing companies in Poland (newly-freed at the time) were charging about $8to $10 an hour wrap rate. The companies paid their workers about $1.5 an hour and the workers manufactured parts on machines without safety equipment and etched and treated parts in acid tanks without any ventilators or appropriate safety equipment.
Is this the future we wish upon our citizen's to compete in a global environment? If so, 99% of us will see our salaries significantly reduced and our standard of living lowered.
It is sadly ironic that people are actually promoting the idea of destroying the health and pension plans of the remaining private and public employers that offer them at the same time that many are screaming for national health insurance and fixing social security.
One of the CNBC anchors was ridiculing the UAW workers yesterday talking about their "free" health care saying they (the anchors) don't get any free health care. Really? Do they actually pay 100% of the cost of a non group health insurance plan for themselves and their families? I doubt it. They are either hypocrites or purposely ignorant in their statements. I'm sure the anchors $$$$salaries are really in-line with the Average Joe as well.
Another lie that has permeated the media and cyberspace is this notion that the average UAW worker makes $73 per hour. This figure is a shop wrap rate. This figure is akin to saying the average plumber charging $125 per hour is making $125 per hour him or herself. It simply is not true. When I worked in manufacturing over 15 years ago the Fortune 50 company I worked for had a wrap rate over $125 per hour. Competing companies in Poland (newly-freed at the time) were charging about $8to $10 an hour wrap rate. The companies paid their workers about $1.5 an hour and the workers manufactured parts on machines without safety equipment and etched and treated parts in acid tanks without any ventilators or appropriate safety equipment.
Is this the future we wish upon our citizen's to compete in a global environment? If so, 99% of us will see our salaries significantly reduced and our standard of living lowered.
Tuesday, November 4, 2008
Make Your Choice and Be Optimistic
Whether John McCain or Barack Obama is elected president, we, as Americans, need to reignite our optimism and look to identify a national initiative to allow our country to continue as a world model for opportunity and prosperity.
I believe that our greatest opportunity lies in our biggest challenge, that is, becoming energy independent by finding an alternative to crude oil-based energy products. I have identified it as one of the 3 Pillars of Prosperity .
Whomever is elected president should seize this opportunity and use to develop policy and initiatives that move America to be the world leaders in this technology throughout the remainder of the 21st Century.
I believe that our greatest opportunity lies in our biggest challenge, that is, becoming energy independent by finding an alternative to crude oil-based energy products. I have identified it as one of the 3 Pillars of Prosperity .
Whomever is elected president should seize this opportunity and use to develop policy and initiatives that move America to be the world leaders in this technology throughout the remainder of the 21st Century.
Friday, October 10, 2008
3 Pillars of Prosperity for America
Our nation’s future prosperity is in jeopardy. The media is standing by commenting on America’s downfall like they are watching a boxing match with the reining champion being battered into oblivion. Many leading media personalities actually seem excited by the possibilities of mass bank failures, devastating job eliminations, and the loss of key industries such as our automotive industry.
We cannot let this happen. Our people must act to ensure that we provide abundant opportunities for our children and our people’s future. Unlike our great leaders of the past such as Washington, Jefferson, Lincoln, Theodore and Franklin Roosevelt, and Kennedy, our current elected officials have not shown the leadership, charisma, and confidence expected of them in times of a national crisis such as the one we are facing now.
It’s time to take the government back from the special interests on the left and right and return the responsibility to the citizens that love this country for what it stands for, freedom and equal opportunity for all.
In our nation’s history in times of crisis old structures have been cast aside and new ones have emerged that moved our country firmly forward. The current structure made up of the Democratic and Republican Parties have long passed their prime and are mired in paralytic rhetoric. It’s time for a paradigm shift, a new structure, the Responsible Citizen’s Party.
The platform of the Responsible Citizen’s Party is simple, put the money in the pockets of the American People. This is accomplished by lowering taxes for low and middle-income Americans and providing tax credits for upper-income Americans and corporations who directly invest in our country’s future.
Sorry, no breaks for short sellers, US asset auctioneers, or derivative traders.
The success plan for America’s future begins with the 3 Pillars of Prosperity for America outlined below.
3 Pillars of Prosperity for America
· Make America energy independent by accelerating the development of alternative energy sources utilizing nuclear, solar, wind, geo-thermal, hydro, tidal, bio-fuels, natural gas, and fuel cell technologies. T. Boone Picken's Plan is the best, most comprehensive, plan currently developed. For details see http://push.pickensplan.com/
· Refocus our automotive and commercial vehicle industries to become world leaders in electric vehicle technologies, high mileage diesel, and natural gas.
· Bring our infrastructure up to the 21st-Century by rebuilding our crumbling bridges and highways, increasing the high speed rail footprint between major metropolitan areas as well as light rail within urban regions, and upgrading our electrical and communications grids to facilitate delivery of energy and information.
The 3 Pillars of Prosperity for America would be a national initiative providing low-interest loans, grants, and federal assistance to corporations, entrepreneurs, and organizations that make, build, develop, or buy products and services within the United States.
The job of building a prosperous America is everyone’s responsibility. It’s time for our nation’s corporations to rebuild the trust of the American people by demonstrating integrity, corporate responsibility and civic commitment. Tax credits could be issued to companies that demonstrate a tangible and measurable commitment to America by providing capital, labor, and resources to improve the communities in which they operate within the United States.
Put America to work and ensure a strong future for our nation’s children.
We cannot let this happen. Our people must act to ensure that we provide abundant opportunities for our children and our people’s future. Unlike our great leaders of the past such as Washington, Jefferson, Lincoln, Theodore and Franklin Roosevelt, and Kennedy, our current elected officials have not shown the leadership, charisma, and confidence expected of them in times of a national crisis such as the one we are facing now.
It’s time to take the government back from the special interests on the left and right and return the responsibility to the citizens that love this country for what it stands for, freedom and equal opportunity for all.
In our nation’s history in times of crisis old structures have been cast aside and new ones have emerged that moved our country firmly forward. The current structure made up of the Democratic and Republican Parties have long passed their prime and are mired in paralytic rhetoric. It’s time for a paradigm shift, a new structure, the Responsible Citizen’s Party.
The platform of the Responsible Citizen’s Party is simple, put the money in the pockets of the American People. This is accomplished by lowering taxes for low and middle-income Americans and providing tax credits for upper-income Americans and corporations who directly invest in our country’s future.
Sorry, no breaks for short sellers, US asset auctioneers, or derivative traders.
The success plan for America’s future begins with the 3 Pillars of Prosperity for America outlined below.
3 Pillars of Prosperity for America
· Make America energy independent by accelerating the development of alternative energy sources utilizing nuclear, solar, wind, geo-thermal, hydro, tidal, bio-fuels, natural gas, and fuel cell technologies. T. Boone Picken's Plan is the best, most comprehensive, plan currently developed. For details see http://push.pickensplan.com/
· Refocus our automotive and commercial vehicle industries to become world leaders in electric vehicle technologies, high mileage diesel, and natural gas.
· Bring our infrastructure up to the 21st-Century by rebuilding our crumbling bridges and highways, increasing the high speed rail footprint between major metropolitan areas as well as light rail within urban regions, and upgrading our electrical and communications grids to facilitate delivery of energy and information.
The 3 Pillars of Prosperity for America would be a national initiative providing low-interest loans, grants, and federal assistance to corporations, entrepreneurs, and organizations that make, build, develop, or buy products and services within the United States.
The job of building a prosperous America is everyone’s responsibility. It’s time for our nation’s corporations to rebuild the trust of the American people by demonstrating integrity, corporate responsibility and civic commitment. Tax credits could be issued to companies that demonstrate a tangible and measurable commitment to America by providing capital, labor, and resources to improve the communities in which they operate within the United States.
Put America to work and ensure a strong future for our nation’s children.
Tuesday, October 7, 2008
World-wide Crisis
World financial markets are in turmoil. Banks around the globe continue to experience massive selloffs of their stock. The Royal Bank of Scotland (RBS) is down nearly 40% today as I write awaiting a decision on whether or not the UK is going to infuse some much needed capital into RBS's coffers to shore up its reserves. http://www.cnbc.com/id/27062806/for/cnbc/
Based on what is going on in Europe and Asia it looks like another yo-yo plunge for investors in the US. It is hard to believe that this meltdown and the fraudulent corporate criminals and their congressional/senatorial accomplices have not received the wrath of the American populace thus far.
It's time to demand those responsible for this mess being held accountable and sent to jail, have their assets seized, and develop a plan to recompensate those they stole from. That would be a start!
Based on what is going on in Europe and Asia it looks like another yo-yo plunge for investors in the US. It is hard to believe that this meltdown and the fraudulent corporate criminals and their congressional/senatorial accomplices have not received the wrath of the American populace thus far.
It's time to demand those responsible for this mess being held accountable and sent to jail, have their assets seized, and develop a plan to recompensate those they stole from. That would be a start!
Sunday, September 21, 2008
700 BILLION DOLLAR BAILOUT!
I cannot fathom how we could possibly see giving the Treasury unilateral power to control our financial markets as a plausible solution to this crisis.
The plan contains three sections that are particularly concerning to me, an average Joe, who does not spend more money than I have available and is held accountable for my actions. See Sections 6, 7 & 8 below:
Sec. 6. Maximum Amount of Authorized Purchases.
The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time.
Sec. 7. Funding.
For the purpose of the authorities granted in this Act, and for the costs of administering those authorities, the Secretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, including the payment of administrative expenses. Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.
Sec. 8. Review.
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
Wow! Authority to spend up to $700 billion at a time. Now that's a pretty nice credit limit on Daddy's credit card! Hey if the spending spree turns out to have been a bad decision after a night of too much bourbon, no worries, a get out of jail free clause has been written into the bill covering any fraud, ineptness, or just plain bad decisions not even being eligible for legal review.
I have already written about my suspicions of Secretary Paulson's motives on Bob's Blog. See http://bob4bristol.blogspot.com/2008/07/ron-paul-asking-right-questions.html . I don't see Secretary Paulson, former CEO of Goldman Sachs, as being forthright with his statements to the American people. I do not believe that he has the collective interests of most Americans in mind based on the corporate bailouts packages he has devised to save his reckless financial friends at the expense of the American taxpayers.
The REAL SOLUTION contains the following:
The plan contains three sections that are particularly concerning to me, an average Joe, who does not spend more money than I have available and is held accountable for my actions. See Sections 6, 7 & 8 below:
Sec. 6. Maximum Amount of Authorized Purchases.
The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time.
Sec. 7. Funding.
For the purpose of the authorities granted in this Act, and for the costs of administering those authorities, the Secretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United States Code, and the purposes for which securities may be issued under chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, including the payment of administrative expenses. Any funds expended for actions authorized by this Act, including the payment of administrative expenses, shall be deemed appropriated at the time of such expenditure.
Sec. 8. Review.
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
Wow! Authority to spend up to $700 billion at a time. Now that's a pretty nice credit limit on Daddy's credit card! Hey if the spending spree turns out to have been a bad decision after a night of too much bourbon, no worries, a get out of jail free clause has been written into the bill covering any fraud, ineptness, or just plain bad decisions not even being eligible for legal review.
I have already written about my suspicions of Secretary Paulson's motives on Bob's Blog. See http://bob4bristol.blogspot.com/2008/07/ron-paul-asking-right-questions.html . I don't see Secretary Paulson, former CEO of Goldman Sachs, as being forthright with his statements to the American people. I do not believe that he has the collective interests of most Americans in mind based on the corporate bailouts packages he has devised to save his reckless financial friends at the expense of the American taxpayers.
The REAL SOLUTION contains the following:
- Tightened regulatory oversight of sketchy lending practices and "exotic" loan products.
- Prosecution of the players that fraudulently abused the system.
- Hold homeowners that took out the loans accountable by making them own up to their financial responsibilities. For homeowners with interest-only loans, negative equity positions, and artificially-low ARMs that are readjusting, deals could be worked out that phase in a graduated increase in interest rates to a fixed, market-rate mortgage with a 30 or 40 year duration. This loan could contain pre-payment incentives to help reduce long term interest-rate exposure to lending institutions.
Washington are you listening?
Wednesday, September 17, 2008
The Fed and the Treasury - Bad Parenting?
Well the best way I can relate the actions of the Fed and the Treasury last night is to relate it to a parent disciplining a child that has misbehaved.
First comes the harsh sentence.
Parent: Johnny, you're grounded for six months!
Fed/Treasury: AIG, we're not going to bail you out no matter what!
Parent: We'll don't do it again. I guess you can go to the movies with your friends this weekend. Do you need money?.
Fed/Treasury: Okay, how about $85 billion dollars to tie you over for awhile. Will that be enough?
Just like the inconsistent parent and the naughty child the inconsistent federal officials and the naughty businesses will continue with the undesirable behavior.
Bear, Fannie, Freddie, and now AIG. It's time to come clean. Lay it all out for all to see and figure out exactly how we're all going to take care of it.
One thing's for certain. The rock star CEOs, CFOs, senior management teams and their congressmen and senator puppets should be sent packing. I want to see some blood with some of these characters going to prison. That would be a good start!
First comes the harsh sentence.
Parent: Johnny, you're grounded for six months!
Fed/Treasury: AIG, we're not going to bail you out no matter what!
Parent: We'll don't do it again. I guess you can go to the movies with your friends this weekend. Do you need money?.
Fed/Treasury: Okay, how about $85 billion dollars to tie you over for awhile. Will that be enough?
Just like the inconsistent parent and the naughty child the inconsistent federal officials and the naughty businesses will continue with the undesirable behavior.
Bear, Fannie, Freddie, and now AIG. It's time to come clean. Lay it all out for all to see and figure out exactly how we're all going to take care of it.
One thing's for certain. The rock star CEOs, CFOs, senior management teams and their congressmen and senator puppets should be sent packing. I want to see some blood with some of these characters going to prison. That would be a good start!
Monday, September 15, 2008
No Where to Go But Down
We are in a real quandry. With the Federal Funds rate currently at 2% there is not much opportunity left to move it down. Yet with housing values continuing to drop monthly there is no room to move it up. Given the inverse relationship of higher interest rates to lower home prices the move up would add fuel to the fire at this time. However, moving the rates up is exactly what we need to do.
As I wrote in back in January on this blog, http://newenglandopinion.blogspot.com/2008/01/imminent-probability-of-recession.html, a transparent, plan of Fed funds rates is needed to stimulate investment and build stability. If the Fed were to announce that they were taking down the Fed funds rate to encourage business investment for solid business loans and potential homeowners with solid credit then we might see a softening of the downward spiral. The rate should be set for a specific time period with the announcement that 1/4 quarterly adjustments upward would follow until the rate met the risk-adjusted 10-year average rate of inflation.
Back in July, I wrote a piece titled "The Fed should start moving the Fed Funds Rate up to 5%." At the time oil was peaking at $147 a barrel so some of the conditions have changed but longterm I still believe this is the only way to truly build wealth in our US economy. The following is reprint of this piece:
Attention Federal Reserve: It's time to start moving the Fed Funds Rate up to 5%. That should translate into an 8% Prime rate.
Here's the rationale:
Real companies with real products and real earnings do not need cheap money they can borrow in order to stay in business. Companies like General Electric, United Technologies, Exxon, Kellogg, Walmart, McDonalds, etc. have traditionally done just fine with higher costs of capital.
Savers, like myself, are sick of our substantially less than the real rate of inflation returns that we have been stuck with as money has been passed out like candy by the banks to sketchy businesses, borrowers, and profiteers. I think worthy financial institutions will agree that this scam has not added longterm value to their organizations as witnessed by the 70% decline in the value of financials and the "sitting-on-the-edge-of-ruin" financial condition of some of our largest and oldest financial institutions like Citibank, Bank of America, Bear Stearns (RIP), etc.
Other important reasons for higher rates:
The higher rates will attract greater foreign investment in our country's banks.
The higher rates will increase the value of our dollar against other currencies.
The higher rates will slow down the level of imports reducing the trade deficit
The higher rates will significantly reduce the speculative price inceases in crude reducing the cost to consumers.
The higher rates will fend off inflationary pressures.
The higher rates translated to higher yields on savings instruments and bonds will encourage greater saving rates by consumers.
The higher rates and resulting yields will improve the supplemental income of retired Americans.
Mr. Bernanke are you listening or are you too busy playing with your academic models and other toys you are unwilling to share?
I still feel strongly that higher rates is the proper solution for a strong economy. Time will tell.
As I wrote in back in January on this blog, http://newenglandopinion.blogspot.com/2008/01/imminent-probability-of-recession.html, a transparent, plan of Fed funds rates is needed to stimulate investment and build stability. If the Fed were to announce that they were taking down the Fed funds rate to encourage business investment for solid business loans and potential homeowners with solid credit then we might see a softening of the downward spiral. The rate should be set for a specific time period with the announcement that 1/4 quarterly adjustments upward would follow until the rate met the risk-adjusted 10-year average rate of inflation.
Back in July, I wrote a piece titled "The Fed should start moving the Fed Funds Rate up to 5%." At the time oil was peaking at $147 a barrel so some of the conditions have changed but longterm I still believe this is the only way to truly build wealth in our US economy. The following is reprint of this piece:
Attention Federal Reserve: It's time to start moving the Fed Funds Rate up to 5%. That should translate into an 8% Prime rate.
Here's the rationale:
Real companies with real products and real earnings do not need cheap money they can borrow in order to stay in business. Companies like General Electric, United Technologies, Exxon, Kellogg, Walmart, McDonalds, etc. have traditionally done just fine with higher costs of capital.
Savers, like myself, are sick of our substantially less than the real rate of inflation returns that we have been stuck with as money has been passed out like candy by the banks to sketchy businesses, borrowers, and profiteers. I think worthy financial institutions will agree that this scam has not added longterm value to their organizations as witnessed by the 70% decline in the value of financials and the "sitting-on-the-edge-of-ruin" financial condition of some of our largest and oldest financial institutions like Citibank, Bank of America, Bear Stearns (RIP), etc.
Other important reasons for higher rates:
The higher rates will attract greater foreign investment in our country's banks.
The higher rates will increase the value of our dollar against other currencies.
The higher rates will slow down the level of imports reducing the trade deficit
The higher rates will significantly reduce the speculative price inceases in crude reducing the cost to consumers.
The higher rates will fend off inflationary pressures.
The higher rates translated to higher yields on savings instruments and bonds will encourage greater saving rates by consumers.
The higher rates and resulting yields will improve the supplemental income of retired Americans.
Mr. Bernanke are you listening or are you too busy playing with your academic models and other toys you are unwilling to share?
I still feel strongly that higher rates is the proper solution for a strong economy. Time will tell.
Thursday, August 21, 2008
Time for America to Reach for the Skies
The Dubai Tower (Burj Dubai) located in Dubai, United Arab Emirates, when completed, will be the tallest habitable building in the world with a height of 2087 ft on the highest floor and an overall height of 2684 ft. Interestingly, the Dubai Tower was designed by American architects Skidmore, Owings, and Merrill.
Taipei 101 located in Taipei, Taiwan, had been the tallest building in the world since 2004. This was prior to the Dubai Tower surpassing its height of habitable floors in July of 2007.
We lost our World Trade Center towers to middle eastern terrorists. Yet Dubai, a middle eastern country, is not fearing a similar fate and instead has chosen to build the tallest building in the world shattering old records by a comfortable margin.
It's time for America to reach for the skies. We need to show the world that we remain a relevant force and an source of innovation in the world space. The Freedom Towers being built at 1 Trade Center in New York does not do the job. In my opinion we should rebuild the World Trade Center towers and make them taller than before!
The 21st Century will prove to be a defining century for the United States. Our country's infrastructure is in dire need of serious repairs and upgrades as well as substantial capital investment in new technologies for transportation systems and power generation. We, as a nation, must invest in America's future. These projects will not come cheap but the cost of not participating in a meaningful way will prove to be far more devastating to our country's financial future and our citizens prosperity.
Taipei 101 located in Taipei, Taiwan, had been the tallest building in the world since 2004. This was prior to the Dubai Tower surpassing its height of habitable floors in July of 2007.
We lost our World Trade Center towers to middle eastern terrorists. Yet Dubai, a middle eastern country, is not fearing a similar fate and instead has chosen to build the tallest building in the world shattering old records by a comfortable margin.
It's time for America to reach for the skies. We need to show the world that we remain a relevant force and an source of innovation in the world space. The Freedom Towers being built at 1 Trade Center in New York does not do the job. In my opinion we should rebuild the World Trade Center towers and make them taller than before!
The 21st Century will prove to be a defining century for the United States. Our country's infrastructure is in dire need of serious repairs and upgrades as well as substantial capital investment in new technologies for transportation systems and power generation. We, as a nation, must invest in America's future. These projects will not come cheap but the cost of not participating in a meaningful way will prove to be far more devastating to our country's financial future and our citizens prosperity.
Wednesday, August 13, 2008
Abraham Maslow’s Hierarchy of Needs and Contemporary America
By Robert Merrick
Ever since I was a freshman in college and first studied Abraham Maslow’s theory on humans' hierarchy of needs I have been moved by his concepts and mindful of his theories in my personal observations and experiences.
I first was exposed to this theory in an introductory sociology course that I took at the University of Connecticut with Dr. Sanders. I later encountered this theory in other courses that involved human behavior especially the management and marketing courses I took in business as an upper classman and in graduate school. The hierarchy of needs resurfaced in some of my educational courses as well.
The basic premise of Maslow’s hierarchy of needs is that there are groups of needs that he relates to levels in a pyramid that move one from an instinctual state of animal behavior toward needs that are clearly unique to humans that focus on self-actualization and spirituality.
The lower the level of the unfulfilled needs in the pyramid, the stronger the individual’s motivation to fulfill that need. The levels Maslow identified were modified but the 5 basic levels were as follows:
Physiological – food, water, sex, sleep, bodily functions
Safety – security of body, place, work, family, health, property
Love/Belonging – friendship, family, sexual intimacy
Esteem – self esteem, confidence, achievement, respect of others, respect of self
Self Actualization – morality, creativity, spontaneity, problem solving, understanding of purpose. (Spirituality was recognized by Maslow as being at higher level than self actualization and he published separate works shortly before his death in 1970).
I have found Maslow’s Hierarchy of Needs to be very valid in my personal experiences and observations since I was first exposed to them over 25 years ago. For instance in my role as a teacher I have witnessed the difficulty of a child trying to learn when their most basic (level 1) needs for food and sleep are not satisfied. No matter how motivating the educational experience a child cannot concentrate if they are hungry and tired.
In fact, education largely depends on a child being at the esteem level (level 4) to derive true understanding of the concepts and exercises taking place in the classroom and move to a higher level. Many of the children struggling in school today have been unable to fulfill their level 2 or 3 needs. Overwhelmingly these children are being raised in “family” situations where the adult caregiver has never fulfilled their level 2 or 3 needs. Alarmingly many of these adult caregivers, mostly women, are living a level 1 existence latching on to any “boyfriend” offering the enticement of fulfilling level 2 and 3 needs. Since level 1 needs are the strongest caregivers in that situation will often act instinctively and hope for the best. This is often done to the detriment of the child or children they are responsible for raising since the “boyfriend” often has no interest in the needs of anyone other than himself and has even less interest in fulfilling the needs of his “girlfriend’s” kids.
It is no surprise that the problem of basic needs of family members not being met has deteriorated since the dismantling of the family unit began in the late 1960s and early 1970s. Prior to those periods it was possible to be poor and have your most basic needs met because the strength of the family unit raised all the members up the hierarchy of needs. Safety came from the security of a father seen as the protector of the family and a mother providing comfort and reassurance. The children developed a sense of belonging as they witnessed their parents’ commitment to them and each other through good times and in bad.
As long as marriage is viewed as an unnecessary and even unfashionable alternative in the decision process of whether or not to have children in popular culture, and the media preys on the vulnerable by luring them with illusions of quick solutions that meet their basic needs, the modern American “civilization” will operate more like the instinctive animal world than a sapient society.
Interesting, yet not surprising, recent studies have shown that the role of a father in a family has been underestimated in a child’s physical and emotional development. According to Ronald Rohner, director of the Center for the Study of Parental Acceptance and Rejection in the School of Family Studies at the University of Connecticut, “What we find surprising and new is that a father’s love is turning out to be just as important as, and sometimes more important than, a mother’s love,” Rohner says. (See AScribe Newswire Fathers’ Role in Raising Children: Misunderstood)
The solution lies in a reawakening of the value of marriage and family. A strong cultural and societal message that communicates the decision to have children is not to be taken lightly and is best suited to the strength of two parents who are in a loving and committed relationship.
Ever since I was a freshman in college and first studied Abraham Maslow’s theory on humans' hierarchy of needs I have been moved by his concepts and mindful of his theories in my personal observations and experiences.
I first was exposed to this theory in an introductory sociology course that I took at the University of Connecticut with Dr. Sanders. I later encountered this theory in other courses that involved human behavior especially the management and marketing courses I took in business as an upper classman and in graduate school. The hierarchy of needs resurfaced in some of my educational courses as well.
The basic premise of Maslow’s hierarchy of needs is that there are groups of needs that he relates to levels in a pyramid that move one from an instinctual state of animal behavior toward needs that are clearly unique to humans that focus on self-actualization and spirituality.
The lower the level of the unfulfilled needs in the pyramid, the stronger the individual’s motivation to fulfill that need. The levels Maslow identified were modified but the 5 basic levels were as follows:
Physiological – food, water, sex, sleep, bodily functions
Safety – security of body, place, work, family, health, property
Love/Belonging – friendship, family, sexual intimacy
Esteem – self esteem, confidence, achievement, respect of others, respect of self
Self Actualization – morality, creativity, spontaneity, problem solving, understanding of purpose. (Spirituality was recognized by Maslow as being at higher level than self actualization and he published separate works shortly before his death in 1970).
I have found Maslow’s Hierarchy of Needs to be very valid in my personal experiences and observations since I was first exposed to them over 25 years ago. For instance in my role as a teacher I have witnessed the difficulty of a child trying to learn when their most basic (level 1) needs for food and sleep are not satisfied. No matter how motivating the educational experience a child cannot concentrate if they are hungry and tired.
In fact, education largely depends on a child being at the esteem level (level 4) to derive true understanding of the concepts and exercises taking place in the classroom and move to a higher level. Many of the children struggling in school today have been unable to fulfill their level 2 or 3 needs. Overwhelmingly these children are being raised in “family” situations where the adult caregiver has never fulfilled their level 2 or 3 needs. Alarmingly many of these adult caregivers, mostly women, are living a level 1 existence latching on to any “boyfriend” offering the enticement of fulfilling level 2 and 3 needs. Since level 1 needs are the strongest caregivers in that situation will often act instinctively and hope for the best. This is often done to the detriment of the child or children they are responsible for raising since the “boyfriend” often has no interest in the needs of anyone other than himself and has even less interest in fulfilling the needs of his “girlfriend’s” kids.
It is no surprise that the problem of basic needs of family members not being met has deteriorated since the dismantling of the family unit began in the late 1960s and early 1970s. Prior to those periods it was possible to be poor and have your most basic needs met because the strength of the family unit raised all the members up the hierarchy of needs. Safety came from the security of a father seen as the protector of the family and a mother providing comfort and reassurance. The children developed a sense of belonging as they witnessed their parents’ commitment to them and each other through good times and in bad.
As long as marriage is viewed as an unnecessary and even unfashionable alternative in the decision process of whether or not to have children in popular culture, and the media preys on the vulnerable by luring them with illusions of quick solutions that meet their basic needs, the modern American “civilization” will operate more like the instinctive animal world than a sapient society.
Interesting, yet not surprising, recent studies have shown that the role of a father in a family has been underestimated in a child’s physical and emotional development. According to Ronald Rohner, director of the Center for the Study of Parental Acceptance and Rejection in the School of Family Studies at the University of Connecticut, “What we find surprising and new is that a father’s love is turning out to be just as important as, and sometimes more important than, a mother’s love,” Rohner says. (See AScribe Newswire Fathers’ Role in Raising Children: Misunderstood)
The solution lies in a reawakening of the value of marriage and family. A strong cultural and societal message that communicates the decision to have children is not to be taken lightly and is best suited to the strength of two parents who are in a loving and committed relationship.
Tuesday, August 12, 2008
Hartford Connecticut, The Modern-day Wild West?
This past weekend Hartford reached the dubious milestone of 100 shooting victims so far this year.
One dead and six injured following a parade in Hartford's North End on Saturday. See 1 Dead, 6 Injured in Hartford shootings
In response a teen curfew will start on Thursday with penalties for teens under 18 found on the streets of Dodge, um Hartford, after 9 pm. Not surprisingly our illustrious friend of criminals, the ACLU, is complaining that this curfew is unfair to all the young upstanding members of the community that roam the streets after 9 pm. See ACLU angered by Hartford's planned teen curfew imposed after shootings leave 1 dead, 6 wounded
If you listen to the response of Eziekel Robert's regarding the death of her 21 year-old son you get an understanding of the problem:
"He wasn't a bad kid. OK, he might have got into the wrong crowd, hung with the wrong people," she said. "But ain't none of them perfect. My son, he was bad in his way, too. But he wasn't the baddest."
According to the Courant, Ezekiel Roberts was found guilty on March 3 of accessory to first-degree assault in the fatal stabbing of 17-year-old Hiram David Colon in East Hartford in 2006, court records show. Roberts was one of six who played a role in the stabbing, but police could not determine who delivered the fatal wound.And Ezekiel Roberts had been arrested four times this summer already — twice for criminal trespass, once for possessing a small amount of marijuana, and once for violating his probation.
It is understandable that a mother would be in grief over the loss of her son. However, it is disconcerting that she doesn't see accessory to murder and continued incidents of lawlessness as being all that bad. This is clearly a problem.
It is also troubling that Eziekel fathered a child at 17. I can only hope that that child has been placed with a decent family so that he has a chance of a future as opposed to many of the children being brought into this violent environment by lawless gangbangers and drug addicts. The cards are stacked 999 to 1 against them as long as they live among criminals.
This behavior is totally unacceptable in American society. It is not a "culture" it is lawlessness. If we need more prisons to handle the mass inflow of low lifes then we should build them. I'm sure we can find a couple of available large, (northern) islands to house the criminals.
One dead and six injured following a parade in Hartford's North End on Saturday. See 1 Dead, 6 Injured in Hartford shootings
In response a teen curfew will start on Thursday with penalties for teens under 18 found on the streets of Dodge, um Hartford, after 9 pm. Not surprisingly our illustrious friend of criminals, the ACLU, is complaining that this curfew is unfair to all the young upstanding members of the community that roam the streets after 9 pm. See ACLU angered by Hartford's planned teen curfew imposed after shootings leave 1 dead, 6 wounded
If you listen to the response of Eziekel Robert's regarding the death of her 21 year-old son you get an understanding of the problem:
"He wasn't a bad kid. OK, he might have got into the wrong crowd, hung with the wrong people," she said. "But ain't none of them perfect. My son, he was bad in his way, too. But he wasn't the baddest."
According to the Courant, Ezekiel Roberts was found guilty on March 3 of accessory to first-degree assault in the fatal stabbing of 17-year-old Hiram David Colon in East Hartford in 2006, court records show. Roberts was one of six who played a role in the stabbing, but police could not determine who delivered the fatal wound.And Ezekiel Roberts had been arrested four times this summer already — twice for criminal trespass, once for possessing a small amount of marijuana, and once for violating his probation.
It is understandable that a mother would be in grief over the loss of her son. However, it is disconcerting that she doesn't see accessory to murder and continued incidents of lawlessness as being all that bad. This is clearly a problem.
It is also troubling that Eziekel fathered a child at 17. I can only hope that that child has been placed with a decent family so that he has a chance of a future as opposed to many of the children being brought into this violent environment by lawless gangbangers and drug addicts. The cards are stacked 999 to 1 against them as long as they live among criminals.
This behavior is totally unacceptable in American society. It is not a "culture" it is lawlessness. If we need more prisons to handle the mass inflow of low lifes then we should build them. I'm sure we can find a couple of available large, (northern) islands to house the criminals.
Sunday, August 10, 2008
John Edwards, Living a Lie.
Back on December 30, 2007 I posted the following to generate discussion about John Edward's candidacy for president:
John Edwards - Champion of the Working Class or Limousine Liberal ?
Is John Edwards the champion for working-class Americans or is he a limousine liberal, whose extreme wealth and expensive taste and indulgences make his promise for "One America" seem disingenuous?You decide. Make your case one way or the other. Be fair!
To be honest the one thing that I found appealing about Edwards at the time I wrote this was his celebrated commitment to his marriage and family and his visible support of his wife who was suffering from inoperable cancer.
Needless to say I was completely floored by his admission to having an affair with Rielle Hunter, a 42-year old film maker, who worked on his campaign.
Answering my own question I guess that his extreme wealth, expensive tastes and indulgences went beyond the marital promises he made to his wife when the two become one before God.
Obviously, he was being disingenuous as he stood before the American people with a straight face calling for his promise of "One America."
Sadly, the story isn't all that different from the one John McCain has in his past with his previous wife before divorcing and marrying Cindy McCain. Only time will tell what lurks in Barack's past that will be launched on the American people for us to stomach before the election.
Are there any candidates of character and principle anymore or are they all living a lie that even they believe is true?
John Edwards - Champion of the Working Class or Limousine Liberal ?
Is John Edwards the champion for working-class Americans or is he a limousine liberal, whose extreme wealth and expensive taste and indulgences make his promise for "One America" seem disingenuous?You decide. Make your case one way or the other. Be fair!
To be honest the one thing that I found appealing about Edwards at the time I wrote this was his celebrated commitment to his marriage and family and his visible support of his wife who was suffering from inoperable cancer.
Needless to say I was completely floored by his admission to having an affair with Rielle Hunter, a 42-year old film maker, who worked on his campaign.
Answering my own question I guess that his extreme wealth, expensive tastes and indulgences went beyond the marital promises he made to his wife when the two become one before God.
Obviously, he was being disingenuous as he stood before the American people with a straight face calling for his promise of "One America."
Sadly, the story isn't all that different from the one John McCain has in his past with his previous wife before divorcing and marrying Cindy McCain. Only time will tell what lurks in Barack's past that will be launched on the American people for us to stomach before the election.
Are there any candidates of character and principle anymore or are they all living a lie that even they believe is true?
Friday, August 8, 2008
T. Boone Pickens Energy Plan
I watched an interview today with T. Boone Pickens on CNBC. I have been following his plan since it first was announced last month. An editorial I wrote on the Picken's plan is contained on a sister website, http://www.unitebristol.org/ which highlights his plan (http://www.pickensplan.com/) and provides links.
Many critics are skeptical of his motivations as T. Boone Pickens is a legendary oil man who has made billions in crude oil. He also has substantial holdings in natural gas and his new plan calls for creating an natural gas supply chain used to fuel automobiles.
His plan, to utilize a natural wind corridor from Texas to North Dakota to power wind mills has considerable merit in my opinion. This area commonly refered to as Tornado Alley has continuous strong winds that are capable of providing significant power used to generate electricity. Picken's claims that using these wind mills to provide the input power necessary to power electric plants it will free up 22% of our natural gas supply currently used to power electric plants. This freed up power would translate into natural gas available to power 38% of the automobiles currently using gasoline.
T. Boone Pickens indicated today that all the money he has will be left to charity. I personally do not care if it makes him even wealthier as long as it helps us to become energy independent and reduces our carbon emissions. The alternative energy opportunities are vast. As I have written in previous posts and articles America's commitment to developing viable alternative energy sources and products could be the driver that continues our high level of prosperity for the next 50 years or more.
Nothing should be left off the table. Our presidential candidates, our government and the American people need to support the Unite States drive for energy independence. Time is of the essence!
Many critics are skeptical of his motivations as T. Boone Pickens is a legendary oil man who has made billions in crude oil. He also has substantial holdings in natural gas and his new plan calls for creating an natural gas supply chain used to fuel automobiles.
His plan, to utilize a natural wind corridor from Texas to North Dakota to power wind mills has considerable merit in my opinion. This area commonly refered to as Tornado Alley has continuous strong winds that are capable of providing significant power used to generate electricity. Picken's claims that using these wind mills to provide the input power necessary to power electric plants it will free up 22% of our natural gas supply currently used to power electric plants. This freed up power would translate into natural gas available to power 38% of the automobiles currently using gasoline.
T. Boone Pickens indicated today that all the money he has will be left to charity. I personally do not care if it makes him even wealthier as long as it helps us to become energy independent and reduces our carbon emissions. The alternative energy opportunities are vast. As I have written in previous posts and articles America's commitment to developing viable alternative energy sources and products could be the driver that continues our high level of prosperity for the next 50 years or more.
Nothing should be left off the table. Our presidential candidates, our government and the American people need to support the Unite States drive for energy independence. Time is of the essence!
Wednesday, August 6, 2008
A Time for Change
John McCain vs Barack Obama. Welcome to the show. It's a verbal cat fight with each candidate harping on some minor statement made by the other, picking on the nuances of the words used or context of the message.
Americans want more. We have serious problems that need to be addressed. Will we have to wait until after their wasteful conventions (Republican Convention / Democratic Convention) to hear anything of substance?
Want some specifics? I put together a little plan that I named A Lincolnian Party Vision for America over 1 1/2 years ago. It's a good starting point for discussion. Perhaps Senator's McCain and Obama can give us a few more details on their plans for our country's future.
Americans want more. We have serious problems that need to be addressed. Will we have to wait until after their wasteful conventions (Republican Convention / Democratic Convention) to hear anything of substance?
Want some specifics? I put together a little plan that I named A Lincolnian Party Vision for America over 1 1/2 years ago. It's a good starting point for discussion. Perhaps Senator's McCain and Obama can give us a few more details on their plans for our country's future.
Sunday, June 8, 2008
Clueless in Washington, D.C.
I have now lost complete faith in our president. His statements the other day that the rebate checks are starting to stimulate our economy is insulting to the majority of Americans who watch the daily price increases in gasoline, heating oil, and food quickly eroding anything they possibly gained since President Bush took office nearly eight years ago. Add to that the pummeling that Americans have experienced in their 401k, 403b, personal stock accounts, Certificate of Deposits, personal savings, the housing and financial crisis, and the severe reduction in the value of what their dollar buys and the president's comments are down right insensitive.
Instead of sitting around talking about how resilient we are in handling the higher prices, how great it is that the inflation rate hasn't transferred to higher wages (you know to actually be able to keep up with the real rapidly-rising costs of food, energy, education, and health care), and how we are setting the example of free world markets (as our prosperity freely moves out of the country and is reallocated in the Middle East and Asia), OPEN YOUR EYES AND DO SOMETHING FOR THE AMERICAN PEOPLE, the ones that elected you and the others to make decisions in the best interest of AMERICANS!
Instead of sitting around talking about how resilient we are in handling the higher prices, how great it is that the inflation rate hasn't transferred to higher wages (you know to actually be able to keep up with the real rapidly-rising costs of food, energy, education, and health care), and how we are setting the example of free world markets (as our prosperity freely moves out of the country and is reallocated in the Middle East and Asia), OPEN YOUR EYES AND DO SOMETHING FOR THE AMERICAN PEOPLE, the ones that elected you and the others to make decisions in the best interest of AMERICANS!
Tuesday, February 5, 2008
Are Electric Vehicles the Vehicles of the Future?
I have been interested in Electric Vehicles ever since I was a kid. I followed GM's development of EV1 with great interest. I also read many accounts by the owners of their love for the vehicle and its outstanding performance.
GM leased EV1 to customers and the cost was quite high. However, the technology was top notch and could only get better with more interest and awareness of this available alternative to internal combustion engines.
Advantages of EV1 were that it could be charged for pennies a day, produced no emissions, had great acceleration and was cheaper to maintain. Disadvantages were that it had a limited range of about 120 miles per charge and was more costly to manufacture due to smaller production runs.
What do you think? Are Electric Vehicles the Vehicles of the Future?
GM leased EV1 to customers and the cost was quite high. However, the technology was top notch and could only get better with more interest and awareness of this available alternative to internal combustion engines.
Advantages of EV1 were that it could be charged for pennies a day, produced no emissions, had great acceleration and was cheaper to maintain. Disadvantages were that it had a limited range of about 120 miles per charge and was more costly to manufacture due to smaller production runs.
What do you think? Are Electric Vehicles the Vehicles of the Future?
Saturday, January 19, 2008
Imminent Probability of Recession
Things looked really ugly this week from an economic standpoint. The tanking of the stock market has been hard for investors like myself to swallow.
The comments on Thursday from Fed Chairman, Bernard Bernanke, were not encouraging to those of us interested in seeing what true economic stimulation ideas he feels would be helpful to stabilize our economy.
The proposed plan of rebates to encourage the debt-strapped consumer to go out and spend some more money on Chinese-made imports is not going to do much in my opinion.
What we need is investment in creating something that satisfies true global demand such as alternative energy products, next-generation transportation, mass transit systems, medical break-throughs for diabetes, breast cancer, colon cancer, etc.
A structured, transparent, plan of Fed funds rates would be helpful to business investment. If the Fed were to announce that they were taking down the Fed funds rate to encourage business investment for solid business loans and potential homeowners with solid credit then we might see a softening of the downward spiral. The rate should be set for a specific time period with the announcement that 1/4 quarterly adjustments upward would follow until the rate met the risk-adjusted 10-year average rate of inflation.
The comments on Thursday from Fed Chairman, Bernard Bernanke, were not encouraging to those of us interested in seeing what true economic stimulation ideas he feels would be helpful to stabilize our economy.
The proposed plan of rebates to encourage the debt-strapped consumer to go out and spend some more money on Chinese-made imports is not going to do much in my opinion.
What we need is investment in creating something that satisfies true global demand such as alternative energy products, next-generation transportation, mass transit systems, medical break-throughs for diabetes, breast cancer, colon cancer, etc.
A structured, transparent, plan of Fed funds rates would be helpful to business investment. If the Fed were to announce that they were taking down the Fed funds rate to encourage business investment for solid business loans and potential homeowners with solid credit then we might see a softening of the downward spiral. The rate should be set for a specific time period with the announcement that 1/4 quarterly adjustments upward would follow until the rate met the risk-adjusted 10-year average rate of inflation.
Subscribe to:
Posts (Atom)