Bob’s take on

I scoured the internet and news reports to see if I could find some good economic news. The only good news I heard was Obama administration officials saying over and over that the economy will get better by year end and they have forecast in their new Budget that the economy will be up 3% in 2010. His staff is on CNN constantly saying the economy will recover this year. (However, Warren Buffet, richest man in America, says that it will be bad thoughout 2009 and into 2010).

Of course, no one has any idea what will happen, either politicians or economists, so the only thing to do is put together all the facts and make our own guess.

On Friday, Feb 27th, the government commerce dept surprised everyone when they reported that the economy DROPPED the most in the last quarter since 1982, at -6.2% , almost twice the predicted 3.8%.  The stock Market reacted again by dropping to 7,062 which is the lowest since May 1997 and now down 50.1% from its peak of 14,164  ,  Even the Wilshire 5000 stock average is down 52.7% ===  so now you know why the joke by the taxpayer is that every 401K is now a 201K, although many are not laughing.  And those that know about the “fake” Social Security Fund, that is empty, will not help us when retirement age comes.

Talking to friends in the car business, I learned that consumers are NOT buying the PRIUS now, but back to buying large cars and trucks again ===  there goes gas to $4 a gallon again by next year, if we do have a recovery predicted by the administration.  Even Pacific Ethanol is closing plants in Idaho and California and the Renewable Fuels Association reported this week that 23 of 171 plants are currently shut down. More Tax subsides will be required. The Government LOVES high gas prices to force GREEN technology. More tax dollars not accounted for in a Budget.

The world wide recession has caused many riots and demonstrations against globalization and increased calls to impose tarrifs—the same moves that caused the great depression. So now American greed has caused more discontent than the Iraq war. http://www.spiegel.de/international/europe/0,1518,610099,00.html

The auto industry: Last week General motors submitted their REORG plan to the Obama administration and they were happy with the “reforms”. However, others looked at the numbers and are tired of giving them another $30 Billion bailout after the bailout they just received. Auto sales are being revised downward from 10 million next year to now 9 million, and still no sign of recovery. Even 60,000  Opel car workers are protesting to breakaway from GM, because they say GM has screwed up their company. http://politiken.dk/newsinenglish/article658396.ece

I think GM needs to  go BK, reorganize, slim down  and come back smaller. One scary thing reported by GM is that they are staking their future on the VOLT electric car in 2010. It will cost a reported $40,000 (with Obama giving you about 7,000 taxpayer dollars rebate). However, they also predict the cost will drop to around $25,000 in a year due to more demand. Who would buy a car that will depreciate that much in one year—you guessed–rich movie stars. I read in 2001 that Gm will need to change or die. They did not die because American greed, stripping equity from homes, kept them alive.

The numbers in the new $4 trillion Obama budget are enormous and will cause a fight in Congress. Even the INTEREST on the debt forecast in a few years will cost every taxpayer over $52,000.  Still the administration is on the TV saying only the top 2% of the population will be paying the bill. Also many think it is a very DUMB move to limit tax deductions to CHARITY for Rich people. The administration predicts it will stop about $600 Billion in giving to Charity over 10 years. So now we are stopping the RICH from donating, so the taxpayer can pay this (we will not give up on the poor, homeless, etc). This dumb idea , I hope has no chance passing. I was actually giving up hope for America after my research this week.

But—did everyone give up hope for Congress after the past week, when Congress voted for the 1000+ page STIMULUS Bill without one person reading it? They received it at 11PM the night prior and had to vote on it because Nancy Pelosci and her friends had to take a  flight to Italy at 6PM the next day.

However, there is a little hope out there in the public. Even though no  major news outlets reported it, there was a movement yesterday called the “Tea Party” that had protests in 40  US cities against this Congress and massive spending.  http://www.freep.com/article/20090227/NEWS06/90227075/Lively+crowd+protests+Obama+in+Lansing

They are mad about Congress not reading bills, massive bailouts to GM and Chrysler, and Government bailing out homeowners that bought homes with ZERO down. Most of the homes are in only 4 areas of the US in a recent study.  Some argue that the government trying to artifically propping up home prices will prolong the recovery even longer–until home prices reach an affordable level. In fact, the Department of Housing and Urban Development proudly says that it is shoveling money out the door as fast as it can.

I AM EXTREMELY NERVOUS ABOUT THE ENORMOUS AMOUNT OF FHA STREAMLINE REFINACE LOANS THAT REQUIRE NO APPRAISAL.  I see another scandal in a couple years with the taxpayer on the hook this time.

Some on CNBC, the business channel, suggest that Obama’s new budget  is declaring war on investors, entrepreneurs, small businesses, large corporations, and private-equity and venture-capital funds. http://www.cnbc.com/id/29434104  But as much as we hate rich people, we need them for future recoveries to create jobs.

Also, we found out yesterday that Obama’s pick for Commerce secretary(Senator Gregg) quit, not because of tax problems, but maybe because we would find out about how much money he and others make by earmarking money to projects in which they make profit. The newscaster even remarked that making money for themselves and family was not illegal and most Congressmen do it all the time. In this case, Pease AFB was closed, the Senator invested in the business park and then voted several earmarks  worth millions into the area. I think I am more upset with taxpayers continually voting in these corrupt leaders. Let’s see if the Republican party tries to clean this up or put it under the table like all the other joke nominations to Obama’s CHANGE administration.

I love Obama–but he needs to watch it—everyone cheered loudly when he said no more “no-bid contracts” in Iraq  and then passed a Stimulus bill with thousands of earmarks, money to certain companies (which are no-bid contracts). So watch it–the American public may wise up. Our country’s future will be in jeopardy if we don’t clean up our greed and get rid of politicians that use “public service” as a ruse to get rich.

Finally, we know that massive spending from WWII finally got us out of the great depression. We are doing the massive spending, but the only thing we don’t know if the puny 17% of the stimulus bill that went to infrastructure is enough and did we stimulate spending or create jobs? Even though we are not supposed to–it is time to pray!