QE3 & 10 States Drowning in Debt...L&C

Helicopter Ben dropped glops of dollars from his circus craft on the American economy last week. He says this action along with the recent past programs by the Fed has saved our nation from economic catastrophe. According to him, this action will spur the increase in employment. He does not admit the actions of the Fed itself were the cause for the original crisis, the lost in value of the dollar or the stealing of taxpayer's money through the hidden tax of inflation which will be even greater in the future due to QE3. The only thing that his actions has spurred is the increase in the value of gold and I see $2,000 an ounce in the future.
With the above being said, I noticed a report about the 10 states that on average have the highest individual debt and begs the question, how much higher can it go without severe delinquencies? Futhermore, the findings of the list shows that the debt standing is in well-to-do states, but there is no misery report showing the effects on the poor which reached a staggering 46 million on food stamps. Expenses are relative to income, but there is a tipping point for everyone and Ben, that includes nations as well.
Credit.com
released the findings from Experian. It reveals that most states have with their citizens a revolving debt load of about $25,000. Revolving debt is all credit cards and personal loan debt which means the figures would be so much higher since mortgage, auto and other debt instruments are not included.
Washington falls in tenth place and there average hits $26K per person. Keep in mind that disposable money is needed to pay this and other forms of debt. How do the unemployed pay their debt? I don't know, but I'm sure someone will do a paper on it at some time. So, we wait for that answer.
Vermont is next. This state has the lowest delinquency problems which means they know how to manage money.
Texas follows and it should be noted that this state has the highest auto debt which means that someday the new motto will be ..."Texas, the biggest delinquent."
Oklahoma, Virginia, Maryland, Colorado, S.Dakota, Wyoming and finally, Alaska.
Alaska hits the high bar at $30 per person, however like Vermont, their citizens handle money management well.
Liars and Crooks: Uncle Ben wins again! No, not a QB in the NFL, but the Chief of the Fed with QE3. He says this will lower unemployment, but what it does is allow the US to manage their $16 trillion of debt because we all know that QE1 and QE2 did not lower unemployment. What did Einstein say about insanity? Oh, yeah..."doing the same thing over and over again, seeking a different solution. END the FED!

Money for Nothing!?...L&C

...was a great line in a song back in the hippie days and with my present clouded mind, I can't give you the title and artist. Sorry. However, the theme is still strong especially during this presidential election cycle. After losing the contribution battle in July, President Obama raised over $110 million in August to beat Romney who collected another $100 million. Who has this kind of money? Why do they give it to hopefuls unless there is some sought of payback down the road? We know this because when a president gives a speech, the markets rarely are effected, however just an nuance from the Fed chief, Bernanke and the markets can explode or implode. This is a money for hire democracy. Don't like that evaluation? Check out this list and then ask, is money for nothing?
Top Ten List
The following 10 companies are leading the way with money for influence. This is from the Center for Responsive Politics. Remember the two biggest things that the aristocrats supported during their past hey-days was defense and banking.
Number one is a defense company. No surprise to me. Lockheed Martin donated $1.9m with a 60/40 split for the Republicans over the Democrats. They gave another $4m to lobbyists.
Number two is Bank of America. As Mel Allen would say, "How about that?" The two favorites of aristocrats are one, two in these findings. BAC gave $2.2m with a 70/30 split R over D. They gave $870,000 to lobbyists.
Next, another defense contractor, Honeywell. 65%R/35%D. $2.2m for lobbyists.
Huntsman Company. $2.3m, 100%R 
Microsoft. $2.9m with 65%D/35%R and another $1.8m for lobbyists.
Dreamworks. $2.4m with 99%D.
AT&T. $2.5m with a 65R/35D split. They also gave another $7m to lobbyists.
Comcast. $2.8m with a 65%D/35%R.
Goldman Sachs. $4.8m with a 70%R/30%D. They chipped in another $1.4m for lobbyists.
Lastly, Las Vegas Sands with 100%R. This makes sense when various agencies in the bureaucracy of government go on extravagant conferences, spending out of control with the only grief being the occasional nightly report on spending abuses. It is no wonder the Sands donated $11.7m and only $30,000 for lobbying.
LIARS and CROOKS:The Fed manipulating our currency, interest rates and the stock market. Check out this concept. It was reported that the average debt of $17,000 will take 35 years to re-pay with the minimum payment plan. Now, the Fed has reduced our interest rates under the lie of creating jobs by making borrowing cheaper, when in fact, he is reducing the interest payments on our national debt, so no one will notice and they can kick-the-can-down-the-road. How long will it take our government just to re-pay what Obama has added to the debt bill at $5tillion? The entire history of man. End the Fed!

The Battle for 1400...L&C

There is always a war going on within the market between the bulls and the bears. No, not Spain versus Russia or any other interpretation that only serves to confuse the average layman. It is the struggle to gain wealth by directing the stock market to your thinking about the economy. Within this conflict is the tools that flows big money.
Individuals no longer affect the market. The market moves from institutional money There are two camps to activation. The larger uses the basic supply and demand stats. The fundamentals of a companies product. The other is technical. Analysts watch charts with support and resistance lines to the price of a companies stock. They have many other indicators like volume (which I use)MACD, RSI, channels, etc. In a free market these two factors determine the trend, however markets are no longer free because government intervenes either directly or indirectly. This makes trading very difficult because you can be right and still be wrong due to some unforeseen intervention. This is the status of the US market at the moment.
That being said, there are other factors that affect the market. When the review of the market is given as news of the day, it focuses on the three main indexes, Dow, S&P and NASDAQ.
This is another, however, generally not talked about problem. These indexes are constantly being updated and changed. The reasons are many, but only one is talked about in the media. They say that to keep these indexes relevant and reflective of the economy, it is necessary to purge "old" industries like railroads and replace them with modern economy tools like technology. They do this also because of mergers or the buyout of a company that is going private.
What They Don't Say
is that many times these older companies are declining in value which will bring the index down in value and that is the real hidden reason that they adjust these indexes. This past week is a perfect example.
From Kitchen To Garage
including the clothes on your back come from this hallmark store. It is a staple for Malls, an anchor to shopping centers and I'll go one step further. I wager that each one of you, dear readers has something purchased from this store, but it was kicked out of the  S&P 500 Index this past week. Who? SEARS.
Why?
Because sales are down, profits are negative and this will lower the index average. You see, the people behind these indexes know that if the market falls below a support level, well, then there could be a correction or worse from the selling coming out of the technical camp. This is the behind the scenes battle to keep the market above the recent psych 1400 level. It needs this to become resistance in order to go higher.
This nothing new. In fact if you look at the oldest index, the Dow 30, you will only find one original member:GE. This is market manipulation and it is no different than the Fed, ECB or any other central bank or government action.
LIARS and CROOKS: Both political parties addressing the public about the platform of the opposing political party concerning Medicare. They both have distorted the truth about what their opposition plans to do with the health agency.

Housing:Another Leak in Dam in Europe...L&C

The expression, "a man's home is his castle," is an important cultural point in America. This is crucial to understanding the effects of the housing crash in 2008. The pundits will inform you that on average 27% of our personal wealth is invested in our homes. This information is the same as those telling us that the recession is over when twenty percent of us still have their homes under water, when 8.3% is still unemployed and only 63% of the work force are actually working. News for you, buddy, this is a depression for all of the above.
Now, this piece is suppose to be about another overlooked problem for Europe. It is. Keep in mind that the US is the largest individual economy in the world and I'm using it as an example to correlate with the present situation in many European nations.
Market Economies
do not perform well while their national housing is collapsing. In the US consumers contribute to two-thirds of our economy. We are getting stable, but we are not doing well in spite of all the money the Fed has printed into our system. Housing is central to our economy, culture and standard of living. At the moment it is still a mess. This is the problem. Each nation is different, but their overall economies will reflect the generality of market economies. Now, a comparison with some European members.
UK and US
were on the same rising price for housing from 2001 until 2007 when cracks began to appear in the US leading to the crash. In Great Britain hosing took a small dive, corrected, continues to rise. Prices have doubled since 2001 which begs the question. Did the UK economy double? No! Did their demographics double? No! So, who is going to buy when sellers want to unload? Collapse time!
Spain
their prices soared even higher than the US or UK and they have fallen even lower. Spaniards hold 80% of their assets in their homes. With youth unemployment over 25%, a nation in economic recession, severe debt problems and falling home values who ya gonna call? GHOST BUSTERS!
France
housing prices doubled, but we can ask the same question about their economy. Recently, it has fallen to .02% and its population grew at .05%. The French keep 57% of their assets in their homes. I hate to tell them this, but delinquency rates tied to mortgages are reaching 15% and when the US crashed that same correlation reached 10%. As CCR would sing, "I see a bad moon rising".
Liars and Crooks:Old Helicopter Ben gets it again. A phony letter from him leaked to the press on Friday saying stimulus is being planned or to that affect which gave the market a rise along with Obama who needs and wants it to stay that way until the elections. Oh, by the way Bernanke's term ends this year. They are so phony! End the Fed!

A Nation Where Anyone Can Be President?...L&C

Do you remember back in your schooldays when the teacher made that bold statement about America? That defining moment in social studies / history class is becoming another facet of life in modern America that is joining the Dodo bird. It is getting so bad that soon that opportunity will even escape the rich. It will land in the lap of only for billionaires and their descendants.
 When you look at the way the rich have not only lined their pockets at taxpayer's expense, but they have systematically set up laws and agencies to maintain this status quo. I could give examples with B. Born who wanted to structure derivatives, but Greenspan shot her down and the list is endless.
 Who will represent the middle class(if we have any left)and the poor(just about everyone)? The conflict between the workers and those who control production historically centered around the debate whether you were a Republican or Democrat. Today however, President's Obama and Clinton have demonstrated that their door is open to money, big money. The Democrats voted for Bush's tax deductions for the rich, extended the two wars and could add another with Iran, Syria and other hot locations. Does it matter that the "fiscal cliff " is approaching? No one from either party(see they are the same)will ask budget cuts from the military which is the real reason why we have no money left in our budget.
One Month=$100 Million
Yes! That staggering sum was raised by Romney for his campaign in July. Obama came in with a paltry $60 plus million. Can you see the problem here? Big money is dictating the election. When the dust clears and the winner announced, who will come knocking on that door? Not you nor I. We don't have access, time or money. We only offer a vote that is meaningless. Swing states voting matters. The use of big money in these regions to cloud issues, confuse voters, and cause apathy will determine  the outcome. The moden vote only serves the principle that this is how a democracy works. Neither candidate intends to respond to the nation's needs. They will only respond to the people and groups which made their victory possible. Don't believe or accept that? Show me results that say anything different. For example, every President from Nixon to Obama has stated that our nation is in danger because we are energy dependent. They said that they would do something about it. Nothing! ...And don't talk to me about alternative energy, CNG(compressed natural gas)or anything else. Private enterprise is moving, although way too slow and government only talks in sound bytes with token change. This year Bush's corn ethanol program will come under attach(should be eliminated)when our corn crop falls from projections and needs. Food inflation is coming, but you will only hear about it here.
Pacs, Activists and A Tax Free Campaign
The Supreme Court ruling that corporations are entities will help destroy the "anyone can be president" concept along with Pacs and the new fringe associations. These unknown groups with a motivated focus with names like,"America for Americans" and "Citizens for the Future" sound all well and good, but their agenda is all status quo and worse yet. These insiders start these groups in preparation for the national election. They get their clearance by advocating a cause like environment(think Sierra Club, which I like as an example). Then, they get a certified tax exemption. Now, they use it to push across their real intentions with no names attached(hide identity) and supported with taxpayer's expense. Their commercials will usually lie about the opponent in an election or the issues. One thing for sure, America is heading for internal conflict because these divisive techniques will eventually come to light and emotions will flair. Our only hope is that a third party gets formed that represents the people and actually does something for the people. Keep this in mind with the approaching fiscal debate, election and issues.
Liars and Crooks: Our government agencies need an overhaul. They have massaged the truth so badly that lies even have a shred of truth in them. For instance, here are two statements from different agencies that makes each agency findings in conflict with each other. A report this past week stated that 44 states had a rise in unemployment and yet, the Labor Dept. stated no change in unemployment. The CPI came forth showing only a .01% inflation increase which is nothing and we all know that gasoline rose over .30 cents-a gallon for the month of July and food cost more every time we go to the store. The real culprit is the Fed which prints money which devalues all our dollars. This unseen tax is killing our way of life. End the Fed!

PREDICTION: Second Recession!...L&C

An easy interview reply on CNBC, CNN or any other financial news network is to remind the viewers that the market generally rises in an election year. This allows the "talking heads" on whatever station to bring up conflicting info like low volume, lack of interest by the retail investor(you and me)or any other chart or earnings report that would make one pause to think and doubt the present rally in the market. The host could mention Netflix or Chipotle both down hard this year as the guest would counter with Apple or GE. The station hopes that this will create among its viewers a creditability to maintain its rating power as a status quo force. This is the format. The problem is that it gives out only partial truths in these sound bytes. This is why, dear reader, I write my blog.
Indicators
that you read here won't hardly ever be mentioned on the tube and if addressed, they will be glossed over as in the normal format of these shows. One of the most insightful is the container chart. You see, no matter what is moved or sold, it must be packaged and that package is usually cardboard. If the charts rises, the economy is growing. Conversely, if it declines, it is shrinking. Today, it is pointing lower.
Housing
the media is gushing that reports reflect that housing is finally at a bottom. This is very important because for a service economy. This would boost employment and the economy. These shows will flood you with facts like year-over-year for the first time, housing prices rose. They will point to a smaller inventory of homes on the market, less foreclosures and even Freddie Mac showed a profit with a positive guidance. This is what they won't tell you nor Obama in one of his reelection commercials.
Gary Shilling
of the Case-Shiller index, says we have a long way to go. He and I will remind you that the robo signing disaster has caused a slowdown in the foreclosure process. There are still 1.7 million homes waiting to come on the market. The flood will continue with the number of homes that are under water, just waiting for a price rise so the owners can get out. This could be as many as 24 million homes. There is also a little known housing price chart dating back to 1890 which began the explosion in housing prices and the recent decline is finally getting back to normal. You ask, what price is that? Another drop of 22% and that would reflect fair value in the trend line of housing prices.
Harry Dent
is famous for his correct predictions with his study of demographics. He sees another serious drop in housing which means the economy because the baby boomers are retiring and at best will seek smaller homes. There are 75 million in this age bracket.
Finally, another top analyst, David Rosenberg has presented a new twist which I find very insightful. He looks at the import/export numbers. He found a sharp decline which he says points to a recession. In April the number was 59  and every month since has declined to a recent 46 in July. He further correlates this to US exports and ISM new orders. He finds a high relation at 81%.
I hope this info can help you make smart decisions for your future.
LIARS and CROOKS:This week goes to President Obama who has repeatedly invoked executive privilege. He just changed the state welfare law to allow states to by-pass the work clause. He, along with most presidents have used this technique to circumvent Congress which according to our constitution will write the laws of the nation. The president's job is to enforce those laws not to create new laws like the above and when he changed the immigration law to allow children of illegals to become citizens. Does the constitution mean anything anymore?

New Form of Outsourcing...L&C

...And the pink slips keep coming. The big boys are keeping the stock market at highs and with the media in their pocket, there is little chance that the public is aware of what is happening on Main St. All across this nation small towns and villages have created a new form of outsourcing. The recession has caused them to cut spending due to lower revenues, especially through real estate. In their search to find more money to provide services, a new twist has developed. These small notches on the map can't afford these services, however they are afraid to cut the cord. They may lose more citizens who may move to a more affluent area, which means even less revenues in a downward cycle.
Solution?
Send the work to nearby locations, lower our costs by cutting workers, eliminating space/rental costs and equipment servicing. In Molalla, Ore. they have outsourced their building permit and inspections to Clackamas, County. They saved over $400,000.
Lowell and Westfir, Ore. outsourced traffic patrols and criminal complaints to nearby Oak Ridge, Ore. Oak Ridge then closed its 911 dispatch service and outsourced it to Lane County Sheriff Department. The savings spread along with the idea. Eugene, Ore now gives its legal work to Lane County Sheriff Dept.
There is on record over 700 cases of New York towns and villages off-loading public-sector tasks to larger government agencies.
Not Just Speeding Tickets
In California almost all rural areas use the California Highway Patrol to keep local law and order. In Florida many counties share 911 dispatch service and sheriff patrols. Bottom line: local government employment is following the lead by corporate America. Agencies are cutting costs which sadly means jobs too.
Liars and Crooks:This week goes to Commodity Futures Trading Commission who are about to drop their investigation into the manipulation of the price of silver on the exchange. Amazingly, Bart Chilton, the Commissioner stated,"he believed there had been "fraudulent efforts" to "deviously control" the silver price. Who benefits? JP Morgan and HSBC. Keep this in mind when the OWS stage their demonstration on 17 Sept. as they are carted off to jail.