Tag: Money Management Mishaps

They Were Just Joking About Fixing the Deficit

Remember all that talk about reducing the deficit made by many of the Republicans during campaign season? Much like Obama these clowns were just kidding:

Republicans on Monday night introduced a measure to fund the military through September and government operations for one more week.

House Speaker John Boehner (R-Ohio) told his conference about the legislation — which contains $12 billion in spending cuts — during a Monday night meeting, his office said. The move is intended to prevent a government shutdown that would start after Friday unless Congress approves another measure to fund the government.

So we’re going to continue funding the military at our current levels until September? The Department of Offense Defense is one of our largest money sinks. Also you know how much $12 billions is to our $1.27 trillion deficit (not to be mistaken with our $15.1 trillion debt)? 0.9%. Yes that $12 billion cut is less than one percent of the yearly deficit. How the fuck can they justify that as cutting the deficit? I also absolutely love this quote:

“We’re serious about trying to prevent a government shutdown. We’re also serious about cutting spending,” he told reporters after the GOP meeting.

Shutting down the government would actually save us tons of money. Hell I’m going to go so far as to say shutting down the government would be the most effective plan for slashing our deficit. I think I’m going to start a “Shutdown the Government” campaign.

Placing Blame at the Right People

I think the title of this story is rather interesting. The title is Brazil banks sued for Amazon deforestation. Obviously reading this has brought to light more evils committed by those terrible bankers who are slowly ruining our planet through their insatiable greed. Well that is until you actually read the story:

Brazil’s biggest bank – the state-run Banco do Brasil – is being sued for allegedly funding deforestation in the Amazon.

For those of you who have a lapse in reading comprehension the emphasis I’m trying to point out is the fact that one of the banks being sued is actually owned and run by the government of Brazil. Of course it’s unfair to blame the state when multiple banks are being sued and the other one is a privately held institution:

The smaller state-owned Banco da Amazonia is also being sued.

Unless it isn’t that is. So why am I bringing this story up? Because I’m sure there will be people spouting on about how the evil banks of Brazil are causing deforestation and that the only solution is for the Brazilian government to step in and reprimand these horrible banks. Those who actually read and understood the article though will realize that these banks are state property and thus the previously mentioned actions would require the Brazilian government to reprimand itself which creates an interesting conflict of interest.

Basically I’m trying to point out the fact that the blame shouldn’t be put on “evil bankers” in this case but on evil government.

The State of Our Economy

You know the government stimulus plan that was supposed to spurt job creation is working out really well when job fairs have to be cancelled because not enough companies are coming forth to offer jobs:

A Massachusetts employment organization has canceled its annual job fair because not enough companies have come forward to offer jobs.

Richard Shafer, chairman of the Taunton Employment Task Force, says 20 to 25 employers are needed for the fair scheduled for April 6, but just 10 tables had been reserved. One table was reserved by a nonprofit that offers human services to job seekers, and three by temporary employment agencies.

It’s OK though. The government will simply do another stimulus plan to spurt job creation. After all if something doesn’t work the most logical solution is to try it again but harder (at least that’s what the Keynesian think as they blame every depression on the government not spending enough money they don’t have).

Voluntary Taxation

Last week I brought up the idea that those whining about not being taxed enough should put their money where their mouth is and cut the state a check. You can also do it on a federal level if you so choose:

So, if anyone out there feels like Uncle Sam’s letting you off too easy, stop bitching and cut the Government a fucking check. Make it payable to “Bureau of the Public Debt” and send it to:

Bureau of the Public Debt
Department G
P. O. Box 2188
Parkersburg, WV 26106-2188

There you go. If you think we aren’t being taxed enough cut your government a check for whatever amount you feel is appropriate. When you finally pay up I’ll start listening to you when you go on about not being taxed enough. Until then feel free to shut up and let the rest of us who don’t believe the government is doing a good job keep the money that is rightfully ours.

For Those of You Who Say Paying Taxes is Patriotic

I bitch about paying taxes as I don’t like money being stolen from me by the state. On the opposite side of the field there are people who say they will gladly pay more taxes and that paying taxes is patriotic (obviously it is as this country was founded on the idea that paying taxes is… a bad thing). Well for those of you who think paying taxes is a good thing you can finally put your money where your mouth is:

Last month, a check for $1,677.97 was sent to Gov. Mark Dayton’s office with instructions to pay down the budget deficit.

Roughly a year before, two checks totaling $136.42 landed at the state treasury with notes saying the same. Some real cash rolled in back in 2008, when a check for $22,685 landed at the state treasury “to help the needy and sick.”

You can give more money to the state if you want to. Of course when people say paying taxes is patriotic or they would gladly pay more taxes what they usually mean is other people paying taxes is patriotic and they are will gladly have anybody who makes more than themselves pay more taxes. Needless to say everybody who has been proclaiming paying taxes as being a great thing generally won’t put up when the opportunity arises.

Thus if you’re advocating for an increase in taxes and you’re not sending money to the state your argument is officially null and void. In other words shut the fuck up.

Wind Power in Minnesota

The greenies love to talk about how great wind power is and then proclaim that every state should start building wind turbines. Because the states of Minnesota is composed largely of suckers there have been several locations where wind turbines have been built. As the state likes to show off accomplishments to make an argument for their existence they put up a website that provides a live feed of the output of various wind turbines.

The problem is this website gives live feeds and most of the time the turbines site at producing 0kW. As I write this the only two places where the turbines are producing remotely usable power output are Olivia (~90kW) and Winthrop (~70kW). Most other areas are reading 0kW or less than 10kW. For the cost of constructing these behemoths it’s not work it. I’d say we could build a couple of nuclear reactors but that’s not kosher anymore due to the third nuclear incident in the 60+ years we’ve been using nuclear power.

Here’s the problem, wind power only works if there is wind. Minnesota isn’t known for extremely high winds so we’re not the best place to build these things. Maybe on a coastline it would make sense and there is generally higher winds but in Minnesota these things are mostly an expensive mistake.

United States Inflation Rate Increases

Anybody familiar with economics (real Austrian economics not that idiotic idea put for by Keynesian) will tell you printing money leads to inflation. Surprisingly many people don’t realize that the United States is no longer using a commodity backed money and instead gave authorization to a private entity (the Federal Reserve is a private entity, not a government entity as the name would imply) to print our money. During this economic downfall the Federal Reserve has been printing up a shit ton of money and not surprisingly it’s leading to an increased rate in inflation.

The inflation rate in the United States has rose 0.5% in February alone. 0.5% may not seem like a lot but it is when you realize this was in one month. The rate of inflation effects the price of all consumer goods. Some consumer goods have rising faster including food and fuel:

Food price inflation was a key driver of the increase. Food costs went up by 0.6% month-on-month, the most in two-and-a-half years.

Petrol prices rose even faster, up 4.7%. But apart from those two categories, price rises were more muted.

Fiat currencies are a bad idea and this demonstrates why. There is no control over how much fiat currency can be pumped into a system and the more that gets pumped in the more inflation occurs. Commodity based money on the other hand has a method of control, the commodity. There is good reason why Austrian economists promote reestablishing a gold standard; gold was a commodity chosen by the market to serve as money. Gold is fairly difficult to obtain so its value stays relatively stable (unless you’re buying it with constantly inflating fiat currency). Its also a self-regulating currency which restricts the spending of government (and regular people to) since any entity they borrow to can demand their debt be repaid immediately in gold. With this threat looming the government can only afford to borrow as much money as they have gold to back.

If you have any interest in commodity based money a great read on the subject is The Case for a 100 Percent Gold Dollar by Murray Rothbard. I’d also recommend reading another title by Rothbard, What Has Government Done to Our Money. These two reads (both freely available at the linked locations) do a marvelous job of explaining commodity based money and the reason its needed. The titles also talk about the history of monetary policy in the United States which is probably the best argument for the return to the gold standard there is.

Reducing Oil Prices

Due to unrest in the Middle East the price of oil has skyrocketed as of late. Except much of the high oil prices aren’t due to unrest in the Middle East (which should be obvious by the fact we get most of our oil from Canada) but from government interference in the energy market. Although the entire article is a good read this part made me shake my head the most:

The SPR program is ridiculous: Oil companies invest in drilling oil wells. They pump the oil out of the ground. The federal government then uses tax dollars to purchase the oil and pump it into salt caverns 2,000–4,000 feet beneath the ground. If we want to use the oil, we will have to pump it out of the ground a second time. We pump oil out of the ground, pump it back into the ground, and then pump it out again. It would be more efficient to store the oil in its original underground formation and allow private oil companies to decide when to pump it out.

Only a government could come to the realization that pumping oil out of the ground only to put it back into the ground and pump it out again at a later date makes good sense. Of course this is all done at taxpayer expense to boot.

The Housing Market Bubble

As it the case with every market the government attempts to turn into a constant boom with the housing market ended up being a complete bust. Case in point, look at the number of vacant homes in Minneapolis. That’s a ton of homes sitting empty and it’s only one city.

I remember when the housing market was in its boom phase and everybody claimed there was no way to lose money on a home. People made a business out of buying a home, sprucing it up, and selling it for a profit. The problem is this boom created a ton of home, more homes that the market demanded. Supply and demand is a very real phenomenon and when the supply exceeds demand the cost of that supply goes down. The more the supply exceeds the demand the more the price of that supply plummets.

It’s such a simple concept that I’m at a loss to understand how our government doesn’t understand it. By pushing banks to make more home loans and guaranteeing these loans even to people who’s ability to pay was unquestionable not there the government helped create this massive failure in the housing market. On the upside if you’re looking for a home you can pick one up cheap. Then again you could also wait for the price to go down even more as it’s going to continue doing for a while.

Stay Classy Chrysler

You know what’s classy? Running a $9 million ad during the super bowl and then turning around and asking for more taxpayer dollars to continue bailing out your failed business:

“I am paying shyster rates,” Marchionne said, noting that Chrysler had no choice in 2009 but to pay the high interest rates the government set as part of its $15 billion Chrysler bailout. “We had no choice… I am going to pay the shyster loans.”

He called the loans “a thorn in my side.”

Chrysler’s also in talks with banks to refinance its debt and plans to have an “agreement in principle” by end of March, he said.

Marchionne spoke at an auto industry conference sponsored by JD Power at a hotel here ahead of the National Automobile Dealers Association three-day convention. He said he is hopeful that the company can win an agreement in principle for $3 billion in low-cost Energy Department retooling loan — a move that is necessary for Chrysler to win private financing, Marchionne said.

Emphasis mine. How about we just let Chrysler go bankrupt to some more competent company can buy up their assets and product cars that people of the world actually want to buy?