While the time is growing short for the US Super Committee to bring forward a plan for debt reduction, there is new hope of a compromise. Rep. Mike Simpson (R., Idaho) has signaled that he is comfortable with a spending cut to tax increase ratio of 3:1 or even 2:1. In a letter to the committee, Simpson tells them to go big and reach $4 trillion in debt reduction. He has 40 House members signing on with him. While Simpson is not part of the higher Republican leadership, he does represent an important new group that is striving to reach … …READ MORE
Tag Archives: Republicans
Why any jobs plan will fail….unless
In light of the recent hyperbole coming from DC, I thought it would be instructive to point out that neither the Republican nor Democratic proposals seriously address housing. By seriously, I mean a large, systematic program that would involve banks and homeowners to write-down the loans, to allow homeowners to refinance and to allow banks upside participation from an appreciation in value of the home from the lower (written down) level (to incent them to participate in writing down the loans). The great deleveraging of the US economy stems from a massive build up in credit that has popped and … …READ MORE
Fed to stay course, Markets to correct course.
Today at 9:30AM ET, Federal Reserve Chairman Ben Bernanke makes his way to Capitol Hill to appear before the Senate Budget Committee for their first meeting of the 112th Congress. He will be testifying on the U.S. Economic Outlook: challenges for monetary and fiscal policy.
We can expect numerous questions on today’s employment data as well as the looming debt ceiling hike. Democratic senators will likely focus on the fall in the unemployment rate and will be generally supportive the Fed’s actions.
However, there’s a new Congress in town and this group will likely not be as obsequent. Look for … …READ MORE
Posted in Front Page Also tagged Ben Bernanke, Federal Reserve, market correction, Senate Budget Committee 2 Comments
5 things you need to know today:
1. There’s a way, just a ? of the will: There are a couple of early articles out broaching the topic of whether firms will begin hiring. The WSJ takes the path of how much money is on the sidelines for large corporations and how this may be used to increase employment. Bloomberg tacks with a focus on small firms improving sales, but how they are staying lean by using temporary help longer rather than adding full time employees. Without job growth, the US economy slides into perdition in the 2nd half of this year.
2. China eases restrictions for … …READ MORE
Posted in Front Page Also tagged Austan Goolsbee, China, congress, currency, debt ceiling, obama, small firms, US employment Leave a comment
Top 3 Trades for 2011
Warning Holiday Alert! Last BU until next Monday!
Happy Holidays….even if you are currently stuck in a European airport.
Top 3 Trades for 2011
1. Sell 5 year Treasury note before every unemployment data day. This is a play on the ending of the Federal Reserve’s quantitative easing program. The US economy has been steadily improving after the second quarter’s dip to 1.7% due to the tightening of credit conditions courtesy of the European debt crisis. For the first three quarters of the year, the US is averaging about 3% and Q4 should be similar (released Jan. 28th).
As everyone … …READ MORE
Posted in Front Page Also tagged congress, Democrats, European debt crisis, Greece, Tea Party, US Treasury notes Leave a comment
5 Things U Need 2 Know 2Day
With the holidays fast approaching, here are the top 5 for the week.
1. China’s inflation is soaring, but China didn’t raise interest rates. As rumored, China’s CPI came in smokin’ hot at 5.1% and was a 28 month high for the nation. (PPI was up 6.1%.) Food was the big driver of higher costs and was up 11.7% in the month. History buffs know that the last political change in China occurred due to runaway inflation and a rising up of the population against the incumbent politicos. The good news is that the PBOC (People’s Bank of China) did … …READ MORE
Posted in Front Page Also tagged Bush tax cuts, China, Democrats, European Union, obama, S&P 500 Leave a comment
The Conflict of Economic Compromise
Yesterday, President Obama cited the extension of the long term jobless benefits as one of the major reasons for why he was willing to compromise on tax cuts for high income earners. With the unemployment rate increasing to 9.8%, almost every economist and strategist on CNBC believed that this extension was the humane thing to do to help them.
What’s interesting is the dilemma it generates from a job creation standpoint. The federal government sends out the benefit checks, but businesses help pay for it. In general, US businesses have to pay for laid off workers (not fired) as long … …READ MORE
Posted in Front Page Also tagged Bush tax cuts, jobless extensions, President Obama, small business Leave a comment
A Step in the Right Direction
Also, up on CNBC: http://www.cnbc.com/id/39038675
Over the weekend, President Obama unleashed a fusillade of economic proposals meant to not only raise the nation’s hopes of economic recovery (just around the corner), but also to raise the flagging poll numbers of the Democratic party.
Here are the kenspeckel polling numbers that give Democrats a queasy feeling. According to a new Washington Post-ABC News poll, 40 percent of registered voters say they have more confidence in Democrats and 38 percent say they have more trust in Republicans.
Sounds okay, right? The problem is three months ago, Democrats had a 12-point advantage. The … …READ MORE
Back In the Saddle
I’m back and apologize for the absence……
There’s a lot O’ Stuff going on in the world this weekend, but a paucity of decent articles….
#1 The NYT has an excellent artcile on Medicare in the Economic View section. Since there has been a ton of press and Obama administration push to spend more money upfront to “fix” healthcare, it’s good for someone to encapsulate what the problem is:
“It’s also hard to convince the American public that the solution to insufficient health insurance is to tax health insurance. And such a one-time tax increase would postpone but not eliminate the … …READ MORE
Posted in Front Page Also tagged Healthcare, Medicare, Obama Administration, World Debt Leave a comment
