About two trillion in new debt is expected before we are finished bailing out America. Of course, by America, we mean big banks, big companies, etc. Do we mean the little man on the assembly line. No, we mean shareholders and executives. Mostly executives, since most shareholders, i.e., Americans have already lost their shirts through their 401K's. So, mostly the powerful are saving other powerful people for the good of America.
Another $200 billion was just announced to prope up the Fannie Mae, etc., the mortgage market. Again, are we talking about the home owner. Not yet, right now we are talking about the government banks. They are also pumping more money into credit market. Both are supposed to make it easier to borrow money, to extend credit to more Americans. So they can spend more and prope up the economy. Guess what, Americans are broke. They have already spent more than they had. Instead of this quick fix, we have to find a way to increase the earning of Americans, not just give them more rope to hang themselves with.
There is no easy way or quick way to do this. Education, working smarter, and laws keeping the fat cats from paying themselves millions while the company they manage goes down the tube, eg., Lehman Brothers. Or the big auto companies in their corporate jets and fat wallets. If the company you are leading is even thinking about bankruptcy and you have been their boss for the last few years you do not deserve a golden parachute, a bonus, or a fat salary. They should suffer with the workers, if that is even conceivable in their world.
The net effect of all this spending of the money we don't have, even though it is the government. You can't cheat mother nature, or economic law more appropriately. The dollar at some point will start falling, rapidly. It would be good at that time to own some gold bricks. Oh yea, I forgot, owning gold bricks in America, land of the free, is illegal. Wonder why? I am not sure if owning stocks in gold companies, or black gold (oil) companies will be quite the same, but it will be better than cash at some point. The money, the trillions, has not hit the streets yet, but it will and bread will hit the ceiling. Wait and see, its called hyperinflation. In my mind, I don't understand how we avoid it.
Do you believe everyone on our planet is our brother? If so, how do we make laws and policies that help our brother? How do we need to change our thinking to lift the boats of all brothers?
Tuesday, November 25, 2008
Thursday, November 06, 2008
Capitalism Does Not Always Work, Witness Richard Fuld
Capitalism and free markets do not always work. Witness the recent financial melt down. Over stretched homeowners lose their shirts when energy prices became the proverbial straw on their back. But, the hedge fund operators who made leveraged bets on the home owner walked away with gold parachutes. Lehman Brothers CEO, Richard Fuld, made $480 million.. Now I thought capitalism was supposed to reward those that do a good job. Obviously, since his company crashed and both shareholders and homeowners were damaged by his leadership, he did a sucky job. Walking away with that much dough when his judgment cost others their homes and livelihood should make him feel bad. It should have made him want to work with homeowners in trying to sort out which ones with a little help could have been saved. But, guess what, I bet he didn't even try.
It is simple, being apart of the good old boy club that runs American companies has little to do with being good. There are hundreds of smarter and more capable people in every single company than there are slots in good old boy club. So, how do you get in. It is more like getting into a fraternity than getting a job. In short, others in the club have to let you in. You are tested first. You have to show that you can make money in your own right, take one for the team, and sometimes do the dirty work -- like laying people off after the good old boy club screws up.
In capitalism, money flows in a circle. Plants makes stuff, pay workers, workers buy stuff. When those at the top, or anywhere else, suck too much money out of the system, by say diverting money to fat salaries that are not earned, see above, then workers don't have enough money to buy all the stuff from the factory and then the factory has to be slowed down and workers get laid off, etc. Downward spiral.
Emotions have always be part of the market place. But, markets have been always been protected by a lack of information and different information flowing to everyone. But, now we have emotions on steroids, its called the internet. Global panic in one day, in one hour is possible. In process control, it is like a feedback loop with the gain turned up to high -- look it up. It means panic feeds panic. Like when you get feedback with you call into a radio station and then stand in front of the radio and talk. Try it. That is what is happening now in the market place.
So now, our wise leaders, are going to get us out of all the problems by spending money. Spending money we don't have, which is very similar to how we got into this problem, by spending money we, as a people and a country, did not have. We borrowed it, either from a bank, or China, etc. So now, our leaders tell us, we are going to get out of the problems by spending more money we don't have. And where did they spend the first pile of money, to the broke homeowners. Nope, to guys like Richard Fuld. That makes me feel better, I am sure they care.
Anyway, perhaps you are starting to see that all is not okay at the big corral called capitalism, or free trade. Well, really this is not free trade or capitalism. What we are seeing here is another example of an age old principle, those with Power abuse their power and hold onto it. The vehicle of that power is often money as it is now, but that will be another blog.
It is simple, being apart of the good old boy club that runs American companies has little to do with being good. There are hundreds of smarter and more capable people in every single company than there are slots in good old boy club. So, how do you get in. It is more like getting into a fraternity than getting a job. In short, others in the club have to let you in. You are tested first. You have to show that you can make money in your own right, take one for the team, and sometimes do the dirty work -- like laying people off after the good old boy club screws up.
In capitalism, money flows in a circle. Plants makes stuff, pay workers, workers buy stuff. When those at the top, or anywhere else, suck too much money out of the system, by say diverting money to fat salaries that are not earned, see above, then workers don't have enough money to buy all the stuff from the factory and then the factory has to be slowed down and workers get laid off, etc. Downward spiral.
Emotions have always be part of the market place. But, markets have been always been protected by a lack of information and different information flowing to everyone. But, now we have emotions on steroids, its called the internet. Global panic in one day, in one hour is possible. In process control, it is like a feedback loop with the gain turned up to high -- look it up. It means panic feeds panic. Like when you get feedback with you call into a radio station and then stand in front of the radio and talk. Try it. That is what is happening now in the market place.
So now, our wise leaders, are going to get us out of all the problems by spending money. Spending money we don't have, which is very similar to how we got into this problem, by spending money we, as a people and a country, did not have. We borrowed it, either from a bank, or China, etc. So now, our leaders tell us, we are going to get out of the problems by spending more money we don't have. And where did they spend the first pile of money, to the broke homeowners. Nope, to guys like Richard Fuld. That makes me feel better, I am sure they care.
Anyway, perhaps you are starting to see that all is not okay at the big corral called capitalism, or free trade. Well, really this is not free trade or capitalism. What we are seeing here is another example of an age old principle, those with Power abuse their power and hold onto it. The vehicle of that power is often money as it is now, but that will be another blog.
Wednesday, November 05, 2008
great for america
Black man makes good, which is good for all of us. It is one small
step toward seeing everyone for the strength of their character
instead of the color of their skin. Ok, that concept came from Dr.
King's I have a dream speech, but I agree.
I told people before the election that I was voting for him because he
was black. People not voting for him felt obliged to tell me that
they were not prejudice. I would say I am not voting for him despite
the fact that he is black, I am voting for him because he is black.
Of course, that was an over simplification of my views, but I was
trying to make a point.
step toward seeing everyone for the strength of their character
instead of the color of their skin. Ok, that concept came from Dr.
King's I have a dream speech, but I agree.
I told people before the election that I was voting for him because he
was black. People not voting for him felt obliged to tell me that
they were not prejudice. I would say I am not voting for him despite
the fact that he is black, I am voting for him because he is black.
Of course, that was an over simplification of my views, but I was
trying to make a point.
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