SWB: Alan B. Rowley II - Success Coach - ECoaching - Email Coaching

A Fair Interview of Ron Paul - Can You Believe It?

As I've said before, Fox affiliates don't have to abide by the "ram the NeoCons down their throats, smear the Democrats, hide Ron Paul" agenda.  Here's a Fox affiliate in Seattle that asked all candidates if they would like to do an interview.  Ron Paul took them up on the offer and they asked some very important questions about the economy, the stimulus package, investigating Bush for starting the war under false pretenses, and corporate media bias "flying in the face of democracy".

Once again, he makes it very obvious that he understands national economics.  He knows the economic history of our country and knows what has to be done to head off the impending economic shit-storm that's headed our way.

I know there are people who disagree with his stance on immediate withdrawal from Iraq, education, and healthcare (even me on this one) but the bottom line is that we won't be able to accomplish anything of worth in those arenas if we are bankrupt. 

Our country has the biggest debt in the world and that puts us in a very vulnerable position.  The greatest threat to this country isn't terrorism, it's the fact that we selling America to China so that we can conquer the Middle East.

As I've pointed out on the personal scale, when the sole purpose of your existence becomes the repaying of debt, you have lost your freedom.  It works the same on a national scale.  We are losing our freedom.   

Interesting Side Effect of the Plunge Protection Team

You can't fool Mother Nature and you can't fool Market Forces.  When the Plunge Protection Team tricks people into buying stocks, the investors are paying far more than market value for those shares.

As we have seen with every artificially created financial bubble, market forces will eventually prevail.  The bubble must burst and the true value must be revealed.  The deception can't be maintained indefinitely.

Snippet Saturday - McCain, Huckabee, California, and Venezuela

I was kind to McCain in yesterday's post because it's not smart to piss off crazy people when I said that it was okay that he didn't know the answer to Ron Paul's question.  His "expertise" is in the area of war and so people can't expect him to know about all the economic tools available to the President.

Looking into it more, I found out that prior to Ron Paul's question being asked, McCain was touting his economic experience.  Politically, I guess he has to because that's the number one concern right now.

So, now my take on it is, if you're gonna lie, I can't feel bad for you when you get caught.

Speaking of lying.  I reported some time back that the tax rate for the Fair Tax that Huckabee keeps putting forth was 23%.  It's actually 30%. 

He's selling it as 23% so it doesn't sound so bad.  In order to try to conceal the deception, they use a little play on numbers.  If you bought something and the total price with tax came to $100, $23 dollars of that would go to taxes.  That's where the 23% comes from.

The truth is that if you bought something for $77, a sales tax amount of $23 would be added to the purchase, which is of course a 30% tax.

Huckabee's tricky and he had me going for a couple weeks.

California farmers, especially rice and tomato producers, are going to let much of their crops die this year.  The government gives them subsidized water and the new plan for the farmers is to buy the water at the subsidized rate and then jack up the price 3 to 4 times and sell it to Southern California.  The water is sold as rights so the farmers won't have to actually ship or do anything.  The water will go to Southern California and the money will go to Mid-California.

The cost of rice, tomatoes, and everything grown in Southern California will probably go up.

Chavez is claiming that the United States is working with Columbia to cause problems in Venezuela and is threatening to stop exporting oil.  I don't trust Chavez but you can't dismiss his claim outright either because the United States has a long and glorious record of destroying governments that won't cooperate with them.

Chavez claims that if shuts off the spigot to America, oil prices would probably climb to $300 a barrel.

Ron Paul - Economist, John McCain - uhhh, not

Ron Paul has released his Comprehensive Economic Revitalization Plan.  This isn't a stimulus package like the others although it would stimulate the economy.  The difference is that this Plan is based on sound economic principles and would have a lasting effect.

If you look at this plan, you'll also see that it's a <sarcasm> tad </sarcasm> more detailed than other plans and includes the actual bills that could be passed to implement the plan.

The economy is the #1 issue among voters and that's going to be even more true in November.  It would probably be prudent to put someone into office that actually knows how our economy works.

This would not include McCain, obviously.

Mitt Romney: Economic Superhero

We are on the edge of recession or we're already in a recession or we are headed for a slowdown but will avoid a recession.  No matter who you want to believe, the economy is on the minds of a lot of people.

Luckily, the Old Media has a savior for us.  Mitt the Millionaire Mormon to the rescue.

You see, Mitt's worth about $250 million dollars.  This makes him an expert on the national economy.

Hell, why not?

Being a prisoner of war 40 years ago makes McCain the go-to guy on war strategy ("Don't get captured" would be high on my military strategy list).  Rudy happened to be mayor of New York on September 11th so he's an expert on terrorism (maybe the mob connections help in that area as well).  Huckabee is friends with Chuck Norris so that makes him a black belt in Tae Kwon Do (and maybe he can speak fluent Korean too).

Mitt is a successful business man so he must know everything about money.  Shall we examine this a little more closely or let the Old Media continue unchecked with their brainwashing?

Yeah, let's examine. 

The Federal Reserve Dropped the Interest Rate Again

Good news, right?

They dropped the interest rate a history making .75%.  Bush is trying to push his stimulus package through Congress in as little as 3 weeks to get money out to people as quickly as possible.  3 weeks is light speed for Congress.

All this to help foreign markets, according to Pelosi.  We are such good guys here in America that we can't bear to see foreign stock markets plummeting.  I feel warm and patriotic all over, don't you?

"The urgency that we feel at home is now even more urgent as we see the impact of our markets on others," House Speaker Nancy Pelosi said after both Democratic and Republican lawmakers met with Bush at the White House.

We aren't doing it for us because, according to King George, the economy has a strong base.  Okay, he did admit that we are doing it for us but he really did say that the economy has a strong base or undercurrent or some such crap.

Is there anyone that doesn't believe this is all very desperate?

Why Are We Feeling the Iraq War Now?

I watched a video yesterday that was asking the question of whether or not the Iraq War was a drag on the economy.  4 "experts" weighed in on the topic and I happen to agree with the host in this matter.  The guy to the left of the host points out that if the war is such a drain, why was the economy doing so well for the first 4 years?

Hmmm.  Let me think?  What was going on during that time that might have artificially stimulated the economy into an unusually hyper state?  Anything come to mind? 

Maybe all of the indiscriminate lending that was going on for house-flipping and refinancing.

Ya think!

Maybe this will help explain what's going to be happening.  This is a super-simplified graph that has no basis in real numbers.  I'm just using it as an example.  What we feel as consumers and customers (there is a difference) is the difference between the economy growth and the inflation caused by all of the money put into the system by the Federal Reserve (much of which goes to funding America's wars and world empire).

As long as the artificially stimulated economy offsets all the spending the government is doing, everything seems fine.  What we feel is the difference between the two.  With little difference, everything feels fine and the war appears to have no impact on our economy.  We can kill people in order to steal their oil to our heart's content.

When housing prices top out, we start to feel that something isn't right.  We start to feel a difference between the money being created and what the economy will be like without all that "free" money being lent out.

As housing prices go down, ARMs reset, foreclosures go up, and the Federal Reserve dumps more money into the system in the form of a Wall Street bailout, the difference becomes extremely obvious (unless you get all your information from the TV).  As the economy tries to reset back to where it's supposed to be before all the crazy lending began and the war continues, the gap between the two widens.

The solution then becomes very obvious.  We need to quit the bailout and cut government spending in a manner that races the declining the economy.  Our best bet for softening the blow of the recession is to cut all borrowing from the Federal Reserve and cut government spending to the point where we can put real money in the hands of the people.

What we have instead is a president who wants to double the size of the war by attacking Iran and the prediction that the Federal Reserve is going to continue the Wall Street bailout at least until June.  The War, the bail out, and even Bush's economy stimulus plan (using money borrowed from the Federal Reserve) will cause the blue line to go up more steeply and as inflation hits harder sending prices up and purchasing down, the pink line is going to go down more steeply.  The wider the gap, the more financial pain we will feel.

Either the people with the power to fix this mess don't understand or they just plain don't care.

Okay, Some People *Do* Get It

European stocks are tumbling today.  People are selling them off in fear of the United States going into a recession.  Tomorrow will probably be a similar story here in the US.

"People aren't buying the US bail-out story and that feeling has been exacerbated by the weakness overnight in the Asian markets," he said (He being Richard Hunter, equities analyst at broker Hargreaves Lansdown).

None of the plans that depend on borrowing money from the Federal Reserve will work.  I've said this often about personal finance and the same holds true on a national level: if the problem if debt, you can't solve it by borrowing more money.

People who are having problems with credit cards aren't going to solve their problem by refinancing their homes.  A government that borrows hundreds of billions of dollars a year to fund a world empire isn't going to fix the economy by borrowing $150 billion more dollars on top of that.

Here's another Success Warrior saying from my cop days.  "The thing I have found about common sense is that it isn't very common."

People think they can trick their way around these sorts of rules.  You can't.  You might delay the day that the financial grim reaper comes calling but you can't stop him if you don't stop borrowing money.

Short Snippets on the Economy

I was going to go into some of these as separate posts but I have to compress the last few days down to this post.  If you're reading this, you have the Internet and can find more information on the topics if you so desire.

Bush begs for oil: Oil prices are skyrocketing and Bush went to ask the Saudis to increase the supply.  An increased supply would decrease the price.  The Saudis refused saying that it's Bush's economic policies that are creating the high oil prices.  They are right.  I had to read that last bit in a foreign paper.

In the US, what you're more likely to hear is that Bush is pleading with them because high oil prices will kill our economy.  That way he can push the blame off of himself and onto someone else.  And who better, really, than those hated people in the Middle East?  It's just like them to want to see us suffer.

Meanwhile Bush continues to borrow money from the Federal Reserve to fund the war and the Fed continues to pump new fake money into the Wall Street bailout.  Both of which are causing massive inflation and the cost of oil to skyrocket.

It's probably better to blame the people in the Middle East though.

USA Today did a piece where they said that stagflation kills our currency.  When inflation rises and economic growth slows, the value of the dollar goes down. 

The sad thing about this is that people trust the USA today.  In actuality, when the value of the dollar goes down, THAT IS INFLATION!  It takes more of those little paper IOUs to buy things because they aren't worth as much.  Stagflation doesn't cause money to drop in value. 

But it gets better.

USA Today said that Ben Bernanke (chairman of the Federal Reserve, the same corporation that is causing history making inflation) is an "honest broker" in the emerging stimulus packages.  I trust Bernanke as far as I can throw all the gold in Fort Knox.

Wait!  Is there any gold in Fort Knox.  No one knows because no one has ever, ever, ever, done an audit on the Federal Reserve.  We don't know what they have done with America's gold.

Bush is going to give the economy a shot in the arm even though everything is "just fine".  Yeah, if it's fine, why do we need to stimulate it.  Not only that but the $150 billion dollars will be in new fake money so it will end up driving up inflation.  The $800 check you get from the government is going to be like taking an aspirin for a migraine.  It's not going to stretch very far in 2008.  2007 had the highest inflation in 17 years.  I believe that 2008 is going to be worse.

Btw, I know how we could end the war.  It came to me in my fevered state sitting on the couch vegging in front of the TV which is something I never do.

Everytime an American soldier is killed, break into the broadcast and do a 60 second piece on how he was killed and what it means to his family.  Don't just put up stats at the end of the news.  Each and everytime we lose another one, interrupt the current show with the announcement.  People might not care too much about another soldier dying and about seeing the spouse and kids crying but you interrupt American Idol too many times and people will be absolutely pissed.  They will be calling for an immediate end to the war.

Obama's Economy Stimulus Package

I reported on the other candidates' economic plans yesterday.  Obama released his plan to stimulate the economy after I had already released my post so here's an update. 

If he had taken a few days, as the Wall Street Journal was reporting he might, Hillary would have been whipping that delay-horse for all it was worth.  Obama's plan is similar enough that she still gets to say that she was first and he's a copycat.  The only way Obama could have won this little political spar was to have thought outside the Democratic box.  He didn't and now they will debate about the little differences each plan has.

Instead of paying heating bills for people, Obama wants to give 150 million people a $250 tax credit.  This would put money in their hands immediately instead of filing applications for help with heating which could take months or years with the government.

Is $250 really going to help stimulate the economy or will that money just go toward the heat bills, credit card debt, and mortgage?  I understand the theory of giving money to people that will spend it but will this amount really result in a change?

$10 billion will be used to help people avoid foreclosure.

Let's be very clear on this because both Hillary's and Obama's plans help people in foreclosure.

How Presidential Candidates Will Deal With A Floundering Economy and the Probable Results

The impending economic recession has become the #1 issue in the political campaign.  It beats illegal immigration and has edged out the war in Iraq as the political hot topic.  Lynette has rightly pointed out that the war in Iraq is the most important factor with the economy and you can't talk about one without talking about the other.  The Old Media has refused to connect the two, most likely because it would change things from a 70% disapproval of the war to a 90% outrage of the war.  If (I so wish it was "when") Americans learn that the reason oil is $100 a barrel and milk is $5 a gallon is because of the war, they are going to be more than a little pissed.  The Old Media which supports the war and is trying to convince us that there won't be a recession will probably never connect the cause with the effect.  They will continue to blame the housing bubble for what is happening and politicians will make their promises on how to fix it without mentioning the war.

Now that the economy is the #1 problem, candidates are starting to talk about it.  What will the next president do to help us with this economic downturn?

Hillary Clinton Plan To Keep Us Out of a Recession is to Boost Inflation

Is it me or does this just sound like a bad idea.  Not that she has worded it this way of course.  She is telling people that she is the next messiah and that we will live in a Utopian bliss of economic prosperity and lower gas prices if she's elected.

Her plan is to put $70 billion NEW dollars into the economy in tax rebates and emergency money for foreclosures and energy.

"The plan won't be offset by spending cuts elsewhere because the idea is to inject new money into the economy, Sperling said. `This is the exception to her hard-and-fast rule that new initiatives should be paid for.'"

I still don't know if candidates like Hillary Clinton are ignorant of how the economy works or if they know but don't care.  Not that it really matters.  Whether it's a lack of education or lack of ethics, the results are the same.  Inflation will only make a recession worse.

I've noted before, the more we try to hold off a recession by injecting fake money into the system, the more likely we are to find ourselves in a depression instead of a recession. 

My fear is that people that don't understand how these things work will fall for Hillary's feel-good solutions that only make things worse.

McCain Puts My Mind At Ease On Recession Issue

McCain said that we are going to be able to avoid the recession that is looming ahead of us.  That turns out to be lucky for him since he has declared that he is ready to spend 100 years in Iraq.

I don't doubt that intention.  We are building the biggest embassy on the face of the planet in Iraq.  Bigger than the UN in New York.  Bigger than the Vatican city.  You don't build something like this for temporary reasons.  It's a fortress that will house the population of small town.

The US is moving into Iraq for good.

All those people who believe that the warmonger candidates are going to give one final big surge, settle the area, and then leave, are not aware of what's really going on.

Or how much it's going to cost the average American.

Turn off the TV and pay off your debts.  Don't let King George, Henry Paulson, or "kill 'em all and let god sort 'em out" McCain lull you into complacency about the state of the economy.

Out Of Control Inflation

If I'm halfway right about the economy of 2008, you are very likely to hear about "out of control inflation" in the Old Media this year.

What I want to be perfectly clear for my readers is that there is no such thing.  Inflation is very much in control.  It's controlled by the Federal Reserve.

The term "out of control" inflation is used to deflect responsibility.  It's used to make inflation seem like this unknown force that just seems to happen.  The government would have you believe that inflation is a monetary Katrina that forms and strikes out of the blue and then they rush in to try to clean up the damage.

The truth of the matter is that we know what causes inflation, the government causes it, there are lots of warning signs, there is no surprise, and it's far from being out of control.

By printing money by the barge-load to fund our military and bail out Wall Street, the Federal Reserve is flooding the market with hundreds of billions of dollars that have no actual value.  When they do this, the supply of money becomes so great that the value of money goes down.  It then takes more of these less valuable dollars to buy things and thank god for debit cards because they will save us from using wheel barrows to haul money to the grocery store.

The Cost of Money

I know I haven't blogged much about money lately.  I'm writing up something longer than a blog post on money.  I'll try to get back to blogging here this year.  The year could be good for my personal finance, bad for the economy, which would be bad for me. 

Anyway, here's a funny video for today.