Sunday, March 19, 2017

Political Thoughts to Ponder

Why does taxing the rich seem so righteous while taxing the poor seems unjust? In ancient Rome, every man owed a month of labor to the State each year. There was no discussion of not being able to pay the tax, but there were discussions on how to buy your way out of it, like hiring a laborer to do your month.

The other day on the news I heard one commentator express their dissatisfaction with giving the rich a tax break. Imagine giving a rich person who pays a million dollars in taxes a 100K tax break. What is wrong with that? Give him a 10% break, and make him feel good. There ought to be some point to where there is a maximum tax on earnings. Put it at 5 million dollars limit on taxes over a lifetime for every taxpayer. Congress has the power to tax, so we know that will never become law.

Then the talk about health insurance. I hear claims that 14 million people will lose their coverage right away. My guess is that these are people under the age of 35 for whom the government mandates have insurance. The health insurers may feel that they have lost 14 million meal tickets, but there is no massive loss of coverage by repealing Obamacare. Most were forced to buy it and they didn’t want it to begin with.

The part of Obamacare that is not insurance, is for previous conditions. If you were too cheap to buy health insurance when you didn’t need it, and now you wish you had it. Or if you feel the emergency room is your free health care provider, then we are talking Obamacare. This is not insurance, insurance is bought to protect you or your family from a future unexpected financial loss.

For most people, going to the ER, is financially painless; they bill you. Many ER units all over the country are closing, they are financially unprofitable and are operating at a loss. I went to the ER one time and after a 6 hour wait got treated and the bill was humongous. I’ve also gone to an Urgent Care unit, and got immediate treatment (after I gave them a credit card). Cost was reasonable. Quite a difference.

Donald Trump has the votes to repeal Obamacare, but might not have the votes to modify it. Kind of makes you wonder. Do we really need government bureaucracy in health care? Think of one thing that government can do better than private industry? The only answer you’ll get is: “Spend more money and get less value in return.” Our government doesn’t make airplanes or hand grenades for a very good reason, the quality would suck.

I remember sitting in a dental office 40 years ago, for a filling, and the dentist came out into the waiting room and ask this hippie to open his mouth. He told the guy that it would cost $250 to fix his tooth and if he didn’t have the cash, he wanted him out of the office because he was tired of working for free. The guy left. I was his next patient and the VA was paying for my work. I don’t like to go to the dentist anyway, and all I could imagine in my mind was a filling in every tooth whether it needed it or not. It turned out OK, two fillings, my imagination is my worst enemy.

The politicians are pandering to the masses. They point to our kids and tell us that we need to do more for them. Food stamps and school lunches allow family resources to be spent for other items like Beer, Cigarettes, Cell Phones, wide TV’s, Gambling and Cable TV. I went to other kids houses as a kid and was confounded when they opened the refrigerator and you would see: two cans of beer, a package of hot dogs and a half gallon of milk and nothing else—no munchies. My parent’s fridge had so much stuff in it that you might not find what you were looking for without spending a lot of time moving stuff around.

The new mission statement in town (i.e. President Trump) is to spend the “average” taxpayer’s money more responsibly. The key word is “average.” These taxpayers want government without the “free ride crap.” You might call it tough love, but they do not want to pay for Welfare Freddie’s 12 pack of beer and cigarettes. The new focus IMHO is on showing the average tax payer that they can expect a better return of value on the taxes they have paid. Of course, if you are a Democrat or a Socialist, this is utter hypocrisy.

Saturday, March 04, 2017

The Economic Conundrum



If I have it right, government interest rates are around one half of one percent. The banks are paying the same. When you examine it, why in the world would anyone put money in a bank for retirement? The incentive is not there.

Then at the same time a homebuyer can purchase a home with little down and at an interest rate of 4 percent for 30 years. With core inflation at 2 percent (by government accounting calculations), the banks are netting about 2 percent on a home loan. Do you wonder where the banks get the money to loan? Individual deposits are considered by the bank as short term accounts, while home loans are long term commitments. As rates rise money moves to the higher interest rate, like it did in the 1990 and brought about the Saving and Loan collapse.

My experience with age, shows the home I grew up in rising from $27,000K in 1964 to 125,000 in 2004. A brand-new car in 1969 was $3,000 and in the year 2000 about 20k. And I can bore you with cigarettes at 23 cents a pack in 1962 and $4.50 in 2000.



CalPERS the California Public Employees Retirement System has lowered their estimated return to the retirement fund this year from 7.5 percent to a projected 7 percent over the next 3 years. The Mercury News claimed that they are lucky if they are earning six tenths of one percent on their investments. The state of California has to make up the shortfalls for the pension fund which is around 100 million this year. The trouble is, the accountants misplaced a couple of zeros that could bankrupt California’s budget.

Then we have the Fed raising interest rates. With a national debt of 21 trillion dollars, a quarter point increase in the interest rate increase jacks up the governments annual interest payments by about 52 billion dollars. The yearly budget for California is a little more than three rate hikes. We are not talking nickels and dimes here.



What can we discern from all of the information presented? We can probably infer that in 40 years everything will have increase in value or cost by a factor of 10 and maybe higher to even 20 times its cost today. Calculated inflations rates will be hopelessly grossly understated because of Congress linking benefits to the rate of inflation. Our interest rates will be determined by the government’s ability to make the payments on the national debt. Rates higher than 8.5 percent make our government insolvent.

Our retirement income programs are in a horrible state with the very low interest rates that have been experienced over the last 12 years. Their failure was the inability to see the Fed’s pushing interest rates to zero. All sorts of insurance companies are at risk here also. The interest received on premiums held by them, helped them give you a better deal on car, health and life rates. And that’s gone away.

Here is where the conundrum lies. The rule of 72 says that if you divide the interest rate into it, you get the number of years for your dollars to double. Right now, that is 144 years. My rule of inflation, states that the cost of everything will increase by a factor of 10 in 40 years and you can bet your bottom dollar on the certainty of that happening.



It is pretty easy to guess that all sorts of taxes will increase. A majority of if will be in the increased cost of the item. Also, look for a decrease in welfare payments; nothing in, you get nothing out. In turn as wages increase, so does the amount the government collects in taxes.

We cannot wait 144 years for our money to double, so the bank and retirement options are toast. Can we wait 40 years for the cost of everything to rise out of sight? Yes, and we even might be around for another 20 years to really enjoy its effect over our wonderful golden retirement years. Tragically it’s about that time that you will realize that old people are invisible; either that or they have all died off and I wasn’t informed of the fact.

The big picture: our financial system was built and modified enough to fail miserably sometime in the near future. Telling anyone will not stop it from happening, but later on in life when they issue you a tube of Preparation H, a tube of Denture Grip and a rocking chair, you will know I was right. You will be “Rockin 'round the Clock,” having no memory of what was done to you financially.

Tuesday, February 14, 2017

Famine the Unanticipated Catastrophe

People assume that famines are caused by a poor growing season. This is true in agrarian societies where everyone farms. However, a financial world banking catastrophe could lead to the same result; where starvation occurs from lack of funds to purchase food. Also, we may be fast approaching a limit where food production can’t keep up with the increased population. War in the Middle East, is curbing a lot of farm production, which is leading to starvation for many.

And then there is global warming. Once the North polar ice cap melts, the Gulf Stream ocean current could change its direction a tad, making Eastern Europe too cold for food cultivation.

A famine could affect a large part of the world’s population. We are at a point now, where bad weather, financial instability or political instability, could determine who will live or die. A nuclear skirmish in a quest to grab resources, could make food very scarce in some areas.

The next famine will not be anticipated. It may be an economic or financial disaster that triggers it. When it happens, the logistics of transporting food to those that need it could be very hard to accomplish. Imagine a high-density population area like India, where many are already at starvation levels and barely surviving. This could be the end of the road for them.

Without the means to purchase food, life is a real struggle. Most of us are not in a position to grow and produce the food we need; we pay others to provide it to us. Those in the third world who are starving to death slowly, could be the medium for new super diseases that the rest of the world will have to deal with in the future. It is this group, with very weakened immune systems, that could be the incubator for a future plague far worse than any war imaginable.

The funny thing is, the third world was our source of cheap labor. As our economy slows down, the funds that made life possible for them will disappear. That thought worries me. A hungry mountain lion is not going to knock on your door and bargain with you over the price of its next meal -- your pet dog in the back yard.

Thursday, February 09, 2017

The Peanut Butter and Jelly Sandwich Mindset

Making a peanut butter and jelly sandwich isn’t hard, I don’t think that an instruction manual was ever requested by someone desiring to put one together. One day at work, I thought aloud and mused as to how much jelly would be considered too much when making a sandwich. No one really commented, but I got the feeling that many of my associates, thought I was not playing with a full deck.

You make the sandwich put it in your lunchbox and eat it at work without a second thought. If someone asked me how I rated the sandwich, I’d probably look at them sideways and think they were being funny. PB&J is not an exotic expensive lunch.

Let’s do the impossible, add politics to a peanut butter and jelly sandwich. Nancy Pelosi and Donald Trump both make a PB&J. We know from the start, that both will complain that the other sandwich has too much or too little of one or both ingredients. Neither one will like how the other’s sandwich was constructed. One will want to create a bureaucracy to regulate how the sandwich is made. The other will be against government controls on sandwiches.

So, when you turn on the news, and they have a Republican and a Democrat discussing the issues, you already know each side’s argument. It’s all about that peanut butter and jelly sandwich. There is no real skill in making a peanut butter and jelly sandwich. The real skill, is to not run out of peanut butter, jelly or the bread to put it on.

Wednesday, February 01, 2017

Our Political System is in Shambles

When Obama won the election in 2008, I felt a loss, my party had not won. I lived with it for 4 years never protesting, and I noticed that most Republicans did the same. Obama came up for re election and won again and I lived with the loss even though I severely disagreed with everything he was doing.

In the last election, my candidate won over all odds. It hasn’t even been two weeks since Trump has been in office, and there are protests over every little thing he does.

Everyone that is a Democrat has an opinion that they believe that they have to enlighten the listening public with. They can’t sit still for this injustice and have to protest. The trouble is it is getting just as bad on the Republican side. They also have an opinion that they want to broadcast to the listener. I can point out the obvious. Everyone is talking, but nobody is listening to them, they don’t understand that.

The Republicans gave the Democrats 8 years of no protesting. The Democrats have given the President his first two weeks of nothing but protesting.

I would suggest that the people in the street protesting Trumps election, are the Fascists. If you are against immigration, you are perceived as unamerican. Of course, if we go back to pre-world war Germany, if you weren’t against the Jews, you were NOT considered a German patriot by the protesting masses. It was the people NOT in power, that wanted to dictate, the values the Democracy was to hold sacred. And we know how that turned out.

We have a new President that has been in office two weeks. My question, what has happened to the Democrats in Congress? They think that the end of the world is near with the election of Donald Trump?

I took a double blast of Obama for 8 years and the world was on a normal turn of events every day of his Presidency. Now we have President Trump and a bunch of Democratic Congressmen and news commentators that think the United States is in a horrible mess because of this transition of power. I question their judgement, only because, I accepted the last 8 years of a Democrat that I considered a complete idiot.

Where we go from here, is an open question, but I think we need to give President Trump more than two weeks to arrive at a conclusion.

Congressman Schumer is the sort of idiot that need to understand that they don’t give Congresswusses an Emmy for crying on TV. Forgive me, I have digressed.

Let’s give our new President one year, and then voice an opinion. Why do I think that this will not happen? Ans: Democrats want it their way or the highway. A fine way to define Democracy!

Sunday, January 22, 2017

Sore Losers

The peculiar reception by the Democrats of Donald Trump becoming President (the out of whack protests) gives me pause to think that the transition of power is one that will shift accountability into a new peridium. The Democrats (Socialist) are pissed, the free lunch is over. It’s no longer food stamps and health care; now you make a choice, food or the cell phone.

Smart government can get to those gaming the system. Many have been taking advantage of government programs too dumb to manage themselves. You can’t blame the people that take advantage of the free handouts.

The real issue here, is that the “Old Democrats” who lost are Socialists and the “New Republicans” are Democrats with more of a bias towards big business. In this morass, the Democratic party has no idea of why they lost, and in reality, they didn’t. I’m not going to enlighten them, that Trump is a Democrat.

A nest of hornets has been stirred up,the Socialists (AKA Democrats)and it will take time for them to calm down. My only worry, I think I can safely confirm that half of the voters in this country are too incompetent to have the right to vote. The good thing is that most of them didn't vote, they just protest after the fact. Real freedom to them, is the ability to wet their pants when they feel like it and I can't argue with that logic.

Sunday, January 08, 2017

Back Soon

Happy New Year Everyone.

I haven't given up posting, we bought a home in December and have been moving into it, the last 3 weeks.

Right now, I have a tendency to fall asleep if I sit down. I should be back to par next week.

Sunday, December 04, 2016

“Dumpster Journalism”

50 years ago, when you picked up a newspaper, you got a report of tragedy’s, deaths, assassinations, wars and weather reports along with the sports and business pages.

In today’s world, we have people writing the news before it happens. The US Presidential election comes to mind. The problem is, it didn’t happen as written.

What is not appreciated here, is that the manipulation did not go as planned. Journalism failed the common reader by interpreting too many facts and arriving at a conclusion that the reader was expected to reach after reading the article.

The Great Depression of 2006 is now being referred to as the Great Recession of 2006. My point that I made in the past, was that the people of the 1929 Great Depression had no idea that they were in great depression. Something was drastically wrong and they had no idea what it was. It was only when you picked up a history book in the 1950’s that you discovered the Great Depression. It was only when things started to get very noticeably better did people look back and see what they had been in.

I used the newspaper example of how Hillary had the election won to show how the truth about the economy has been stretched a tad. We are being told the economy is just great. 95 million people no longer looking for work and 45 million on food stamps. The fact you can earn more money from an interest perspective, spending money, rather than saving money turns every rule about financing upside down.

The stock market hits new highs. Most all stocks are divorced from the company they represent, the only thing that connects the buyer to the stock value is the dividend. Every stock has an owner and it is not the company (from a technical aspect). The price is determined by what another person is willing to pay for it. So a drop in the price of IBM of say $100 would revalue the net worth of shares issued, but not reflect in one bit the real assets of the actual company.

Right now, the world of journalism says everything is just great. Kind of reminds me of the many newspapers that flat out stated that “Donald Trump could never be elected President.” A reality check seems to indicate that whose ever opinions are available to us right now, these pundits don’t know any more than we do.

Admitting that we know nothing, gives us the ability to discard common sense if we feel it necessary. We all want to be comforted thinking we made the right decision by looking for company that shares our views, and that leads to problems. The herd is often wrong when it really matters.

The problems that we are about to face have been around 6 to 8 years. My only advice, if you have a job, keep it for the next two years and see how things progress in the immediate future. I get my first Social Security paycheck in two weeks at the age of 70 and I am still working.

We do have to realize that whatever solutions are proposed to fix the current problems will be solved by people who have saved money in the system (you can't tax people that are broke). The most visible taxable assets are wages, real estate and bank savings. What we need to understand is, the whole population is the target for any solution to the problem, not some sort of spend until we drop, financial boondoggle by Congress. We could end up with a Value Added Tax for manufacturing and production. In the future, for Congress, it should be, "Real money in, Real money out."

Remember when you buy a newspaper, they give you what you want to hear, otherwise you select another news source. So, in today’s world you get to pick your own perceived reality. The trouble is, there is no feedback until it is too late, if you are wrong.

Saturday, November 12, 2016

The Democrats Cannot Believe the Results

Mr. Trump won the election and we have Democrats protesting out in the street even before he takes office. I remember when Obama won, and I sucked it in and said he’s our President now. What he did over the next 8 years irritated the hell out of me! To say the least.

I get the feeling from these protestors that Democracy is great, only if your candidate wins. And the sad thing is that most of the losers in this race were one issue voters; global warming or the woman President fulfilment goal. I get the feeling that the protestors are either incredibly stupid or have been brainwashed by all of the nonsensical ads about Trump. Many are students that were confused as to why they can’t get a job after spending big bucks on college.

The issue we have here, is that the present protests are over a candidate that has never held a political office and has not yet taken the oath as the next President. He has no political record to censure but yet these disrupters of our Democracy, do not give a damn. They want him out before he has even been in.

What we really need to look at, is that we have Donald Trump, a dyed in the wool Democrat, elected as a Republican to be President. He did not fit into the liberal establishment of being politically correct. If you say something that the establishment doesn’t want to hear, you are labeled racist, homophobic, sexist, misogynist and so on. Most people in this situation, shut up and keep quiet. Donald in this case, said bring it on, it won’t stick.

We have come to a point now, where this politically correct police force is visible. Tell a black joke and you are a racist. Tell a religious joke and you’re anti-Semitic. You’re not graded on how funny the joke is.

The real joke is on the political system. It was too corrupt to select real people to run for office. The Democrats had morphed into socialists. Trump was considered harmless. He beat all the Republicans in the Republican primary, got on their white horse and then slayed the Hillary dragon.

The one thing that really stands out, is that the news media failed us and showed everyone how manipulative they are as a group. The misinformation they fed us during this election, calling it news, was deplorable. Everyone thought The Donald was exaggerating and bashing the media unfairly.

The Democrats became the party of the rich with socialism for the poor, while the party ignored the middle class. The socialistic Democrats that voted for Hillary, didn’t see Trump as a Democrat. The Republicans were wondering what made Trump a Republican; they were satisfied with the fact that he wasn’t a “damn Socialist” and liked the second amendment. Sooner or later the people of this country will come to realize that the Republicans, without knowing it, put a Democrat into the Oval office.

The good thing is, we have elected a President with a lot of common sense that will speak his mind and is not beholding to the lobbyists in Washington D.C. Obama the politician can probably take credit for the Trump Presidency. He pissed off the wrong person one to many times. Obama, your fired!!

The neat thing is that both parties won. The Republicans got the man they voted for and the Democrats are too stupid to recognize a Democrat, unless he's holding his hand out for a bribe. "Draining the swamp" just might cure that.

Editors note:
I define a true Democrat as representing the middle class

Monday, November 07, 2016

The Election

If you look at the polls, the split is 44 to 45 between Hillary and Trump. Add them together, and what do you get? 89%

The people that will determine this election are the undecided, the invisible 11%. I am not sure how tomorrow turns out. I'm hoping for a Trump victory.

Faites vos jeux