US Diagnosis: Terminal Bankruptcy
Our doctors, politicians, economist, FED leaders and yes even you and me knew the day of reckoning would come. Well the dawn is breaking. Auto, Bank, Credit Cards and more to come – Retail, Airline, Consumer Electronics etc…. Some of the only beneficiaries are bankruptcy lawyers. And the FED is gearing for another rate cut so inter-banking money will be almost interest free! We conveniently call it a deep RECESSION when in fact this country is dying.
Here are some close facts so listeners can become more aware of how bad it really is:
The US deficit will reach $11 Trillion next year – We refinance the debt and interest + spending Isn’t that what the banks did?
50% (appx) of the deficit is owned by Social Security – Medicare and Medicaid Where did our money go?
Social Security, Medicare and Medicaid are projected at a $99 Trillion deficit Can anyone even fathom that regardless of the above and below?
The FED is printing money 24-7 flooding the world markets with US Dollars Is this Pre War Germany to come – currency devaluing will be a final nail
Healthcare and social programs – stack on another $50 trillion over the next few decades. Healthcare and social programs can’t be paid for – more pandering!
The US is a Consumption Economy – No Longer manufacturing or industrial. Consumers cant or want consume – what does that do to the economy in the next few yrs?
95% of Americans use credit, loans and other debt Credit addition is killing and will kill tens of millions of consumers
All majors sectors of our economy are at historic lows Industrial Revolution era, Depression Era and Pre WW II levels (I hope we hear that)
Unemployment and underemployment have approached historic markers And it will go far beyond 12 years – many more decades to fall in ranks
Corporations crumbling under global competition Unions, High Wages and 2nd largest corporate tax rate
Oh there is so much more! OK now given the above – I would love to hear from anyone that can tell me how the US isn’t insolvent or bankrupt already!
Here is the US Medical picture if easier to visualize:
ILLNESS: Cancer National Deficit Consumption Economy
Cause: Long Term Credit Addition US Lawmakers US Consumers
Symptoms: Run Away Spending Massive Bailouts Consumer Unemployment – Under Employment & Bankruptcy
Doctors: Lawmakers The FED Big Businesses
Treatment: Print Money 24-7 Allocate $2 trillion thus far we don’t have Pray the world holds its confidence in our economy, treasuries and currency
Unfortunately, government and business leaders who most listeners and Americans have never met or spoken to – and never will – are in surgery and recommending radiation treatment to kill off many of us with squeezing the consumer and their ability to work, buy good and keep paying their loans. Doesn’t that seem likely to cause the greater economy to fail and fail again. Yes radiation, FED rate cuts, useless stimulus checks to come, bailout etc… are things in the past that didn’t work. Right – if you continue to do the same – you will get the same result. We need massive transformation and radical solutions or we are DEAD.
So to quote another author “What got you hear..Won’t get you there”. And my favorite “No matter where you go – There you are”. And we are smack in the middle of either saving our way of life or completely ruining our country. So here are the solutions – I have been talking about for a year.
1. Pay off deficit in 1 year.
a. US Institutional Investors – required to invest 100% of the money have over $100 Trillion under management and over 50% in fixed income. Pass Law to require 10% of those monies invest in buying back all US debt = America owes America and Economic Revolution
2. Economy Bonds
a. Only Americans can buy them and the Government gives every tax payer bonds for 5% of their taxes (govt still uses money) and we build a savings nation again.
3. Expunge 30-60-90 – 120 days lates over last year and halt negative reporting until economy settles
a. Why? Our economy depends on consumers. If over $30 million have poor to average credit – they won’t get loans, credit cards etc.. SO THEY CANT BUY ANYTHING – YES EVEN A NEW CAR!
4. Refinance America:
a. We are credit addicted and need rehab. Everyone cannot do this themselves – so the govt should create a huge boom in banking revenue (pay off our loans to banks) by allowing the debts Americans have anyway to be refinanced and consolidated in one payment. This would liberate tens of millions and get their debt under management and require counseling. Toxic loans are toxic because people can’t pay. Through stringent counseling then they can work themselves out of the hole or face many many more bankruptcies.
5. Office of Financial Defense
a. Our economy is the heart and brain of our national security. We are under constant threat right now of Economic War. Immediately set up and office to oversee all economic decisions of this country – ESPECIALLY CONGRESS AND THE BUDGET.
Some food for thought for you and the many listeners we serve.
Monday, December 15, 2008
Wednesday, December 10, 2008
HOW CAN THE CONSUMPTION ECONOMY SURVIVE WITHOUT CONSUMERS
Who is going to be buying cars?
Answer to that – very few. So bail out the auto industry – and It will happen – and they will find themselves right back in trough again because they can’t sell as many cars as they once did. Do we really think people are going to be traveling all over? No they can’t afford to and wait until the credit card companies cut up to 40% of the available credit of consumers. The consumer is already cut off from home equity, refinancing and will emerge regardless of bailouts hobbled at best. Well what does that do to the consumption economy businesses depend on. Yes a car wreck no matter what.
I use the car wreck analogy because as businesses like the auto industry, which is topical, are bailed out, even if you and I don’t agree, the consumer certainly isn’t going to be out buying cars and worse many just can’t. Consumers now suffer from 30-60-90-120 day lates on their credit reports. Consumers are unemployed and with an Obama program of “Great Works” the consumers supporting the economy will find themselves under employed even if they go build bridges and roads. May be great for job numbers and political equity but overall for the economy it will fail to meet the massive waves of chaos that have hit our shores and will continue to drown many industry sectors.
The government is saying this will tighten the belt – it will get worse – and this process will expunge the nation’s credit addicted consumers and bad debts. Really? So you do that and tens of millions of consumer emerge with their credit destroyed and wouldn’t qualify to use credit to purchase anymore. What do you do about that. NOTHING! There are few big ideas, including my rants, that would seem to attack the deficit (our cancer) and the various symptoms to correct our course in history. And by every measure this is historic and will be remembered as the depression of the 21st century. We feel better saying deep recession but it’s a farce. Consumers are the lifeblood of the economy and they are affected the worst.
Yes everyone is culpable – consumer – bank – credit cards etc.. in this massive upheaval, but that is yesterday. No matter where go – There you are! So we are here and watching the corpses of our consumers rotting on the credit battlefield as big business and our government just run right over them. Mark my words a stimulus package – with pandered money – with small checks to consumers will happen. Appalling – that is a waste of money for sure. What about the consumer having credit expunged so they can get credit, having all Americans consolidate debt under one payment (huge surge for banks) so the toxicity of the loans and portfolios isn’t as bad, economy bonds in exchange for some taxes (Japan was a saving nation which saved their financial industry from total wipeout),the 10 percent solution for the deficit – on and on. You thankfully allow me to rant therefore I have a voice – just as you do – can’t we together do something to impact this? Let’s see.
Answer to that – very few. So bail out the auto industry – and It will happen – and they will find themselves right back in trough again because they can’t sell as many cars as they once did. Do we really think people are going to be traveling all over? No they can’t afford to and wait until the credit card companies cut up to 40% of the available credit of consumers. The consumer is already cut off from home equity, refinancing and will emerge regardless of bailouts hobbled at best. Well what does that do to the consumption economy businesses depend on. Yes a car wreck no matter what.
I use the car wreck analogy because as businesses like the auto industry, which is topical, are bailed out, even if you and I don’t agree, the consumer certainly isn’t going to be out buying cars and worse many just can’t. Consumers now suffer from 30-60-90-120 day lates on their credit reports. Consumers are unemployed and with an Obama program of “Great Works” the consumers supporting the economy will find themselves under employed even if they go build bridges and roads. May be great for job numbers and political equity but overall for the economy it will fail to meet the massive waves of chaos that have hit our shores and will continue to drown many industry sectors.
The government is saying this will tighten the belt – it will get worse – and this process will expunge the nation’s credit addicted consumers and bad debts. Really? So you do that and tens of millions of consumer emerge with their credit destroyed and wouldn’t qualify to use credit to purchase anymore. What do you do about that. NOTHING! There are few big ideas, including my rants, that would seem to attack the deficit (our cancer) and the various symptoms to correct our course in history. And by every measure this is historic and will be remembered as the depression of the 21st century. We feel better saying deep recession but it’s a farce. Consumers are the lifeblood of the economy and they are affected the worst.
Yes everyone is culpable – consumer – bank – credit cards etc.. in this massive upheaval, but that is yesterday. No matter where go – There you are! So we are here and watching the corpses of our consumers rotting on the credit battlefield as big business and our government just run right over them. Mark my words a stimulus package – with pandered money – with small checks to consumers will happen. Appalling – that is a waste of money for sure. What about the consumer having credit expunged so they can get credit, having all Americans consolidate debt under one payment (huge surge for banks) so the toxicity of the loans and portfolios isn’t as bad, economy bonds in exchange for some taxes (Japan was a saving nation which saved their financial industry from total wipeout),the 10 percent solution for the deficit – on and on. You thankfully allow me to rant therefore I have a voice – just as you do – can’t we together do something to impact this? Let’s see.
Monday, December 1, 2008
THE TITANIC
Is the US Economy and Big Business too big to sink?
Too big to fail! We have heard this time and time again. Through the history books we heard the same label about the Titanic. Industry after industry keeps running aground as the government continues to bail water out of the sinking ships. How do we save the ship as the life rafts have already been used. What’s next? Pensions, hedge funds, retailers, airlines! How can the US keep printing and borrowing money to plug the leaks stay afloat? IT CAN’T.
The collapse of the US economy is upon us, the ship hit a mortgage iceberg first, then insurance, and keeps ripping the hull at every turn. Bush was right to call Wall Street drunk and I throw in politicians also, Remember Exxon Valdese. The people steering our economic ship were drunk and now even hung over their heads are not screwed on right. while government believes bailing out companies that are too big to fail –like AIG – we all sit in the second and third decks locked in like rats powerless to do anything but drown. The Bread lines we are so familiar with that represented people during the Great Depression have been replaced by companies and entire industries. Everyone is looking to get a hand out, bailout and some way out. But government is not the answer.
During the 80s, 90s and early 2000 the companies we see trying to get a seat at the table have aggregated so many businesses that they are way “too big” now and many can’t fail. So the government has to bail them out? YES. But why hasn’t someone thought of a plan to break up these businesses if government has to step in. GM finance would be a huge IPO and reap billions for GM. GE finance the same and banks and insurance companies can do the same. I know the Leveraged Buyout funds are just licking their lips ready to begin buying assets from failed business. Why isn’t the government forcing the issue that if you take our money we will force a debundling of car brands, insurance lines of business, bank brokerages and lines of business. If we lend the money we can recover the capital quickly through sale of assets and IPOs and really regenerate the markets and streamline big business. Now doesn’t that sound more plausible?
What about the 10% solution for retiring the deficit I suggested. Want a pension and hedge fund bailout then make the markets soar by mandating 10% of their portfolios go toward retiring the US debt. Heck they own some already buying more would cause the stock market to soar. What about Economy Bonds. What about a forced refinancing and consolidation of every household’s debt. 30,60, 90 day lates expunged. If we do nothing but bailout companies then our economy – a consumption economy – will fail worse because millions are out of work and can’t pay their bills. Even if you can pay your bills millions are so hobbled they won’t be buying a car, products, goods and services as they were over the last 30 years. Worse even more millions can’t participate in the future economy because their credit is ruined. How can the US economy be sustained this way. IT CAN’T.
But the government choice is to print money 24-7. Isn’t it clear that this strategy will for certain devalue the dollar and risk our currency as the underpinning of trade. The US is also borrowing money from around the world that it can’t pay back. We see the headlines of trillions of dollars necessary to save the US economy but how does this help when our consumption economy is getting wiped out?
I believe the plan is flawed, even if we take large ownership stakes in businesses to help assure shareholders, you and me, that the money being invested actually is repaid. But if we bail out airlines or auto then what happens when people can’t buy a car? Right it fails later anyway. So the government is trying to play smart and casting off life boats like crazy. But the government is also at the helm and I am certain the policies being implemented will take it down with the ship. Ans remember you and I are trapped on the ship and the life boat, probably in the form of a silly, useless check to stimulate the economy, is what we are being offered. Well grab a life jacket and jump into freezing water – you are sure to economically die either way.
Too big to fail! We have heard this time and time again. Through the history books we heard the same label about the Titanic. Industry after industry keeps running aground as the government continues to bail water out of the sinking ships. How do we save the ship as the life rafts have already been used. What’s next? Pensions, hedge funds, retailers, airlines! How can the US keep printing and borrowing money to plug the leaks stay afloat? IT CAN’T.
The collapse of the US economy is upon us, the ship hit a mortgage iceberg first, then insurance, and keeps ripping the hull at every turn. Bush was right to call Wall Street drunk and I throw in politicians also, Remember Exxon Valdese. The people steering our economic ship were drunk and now even hung over their heads are not screwed on right. while government believes bailing out companies that are too big to fail –like AIG – we all sit in the second and third decks locked in like rats powerless to do anything but drown. The Bread lines we are so familiar with that represented people during the Great Depression have been replaced by companies and entire industries. Everyone is looking to get a hand out, bailout and some way out. But government is not the answer.
During the 80s, 90s and early 2000 the companies we see trying to get a seat at the table have aggregated so many businesses that they are way “too big” now and many can’t fail. So the government has to bail them out? YES. But why hasn’t someone thought of a plan to break up these businesses if government has to step in. GM finance would be a huge IPO and reap billions for GM. GE finance the same and banks and insurance companies can do the same. I know the Leveraged Buyout funds are just licking their lips ready to begin buying assets from failed business. Why isn’t the government forcing the issue that if you take our money we will force a debundling of car brands, insurance lines of business, bank brokerages and lines of business. If we lend the money we can recover the capital quickly through sale of assets and IPOs and really regenerate the markets and streamline big business. Now doesn’t that sound more plausible?
What about the 10% solution for retiring the deficit I suggested. Want a pension and hedge fund bailout then make the markets soar by mandating 10% of their portfolios go toward retiring the US debt. Heck they own some already buying more would cause the stock market to soar. What about Economy Bonds. What about a forced refinancing and consolidation of every household’s debt. 30,60, 90 day lates expunged. If we do nothing but bailout companies then our economy – a consumption economy – will fail worse because millions are out of work and can’t pay their bills. Even if you can pay your bills millions are so hobbled they won’t be buying a car, products, goods and services as they were over the last 30 years. Worse even more millions can’t participate in the future economy because their credit is ruined. How can the US economy be sustained this way. IT CAN’T.
But the government choice is to print money 24-7. Isn’t it clear that this strategy will for certain devalue the dollar and risk our currency as the underpinning of trade. The US is also borrowing money from around the world that it can’t pay back. We see the headlines of trillions of dollars necessary to save the US economy but how does this help when our consumption economy is getting wiped out?
I believe the plan is flawed, even if we take large ownership stakes in businesses to help assure shareholders, you and me, that the money being invested actually is repaid. But if we bail out airlines or auto then what happens when people can’t buy a car? Right it fails later anyway. So the government is trying to play smart and casting off life boats like crazy. But the government is also at the helm and I am certain the policies being implemented will take it down with the ship. Ans remember you and I are trapped on the ship and the life boat, probably in the form of a silly, useless check to stimulate the economy, is what we are being offered. Well grab a life jacket and jump into freezing water – you are sure to economically die either way.
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