CLEAN AIR ACT...A FARCE TO FORCE HIGHER ENERGY COSTS FOR EVERY PRODUCT MANUFACTURED OR DRIVEN OR USED BY EVERYBODY! THE PRESIDENT AGREES TOO!



Waxman, the strange looking guy in the sausage outfit is the culprit. Nancy Pelosi said that this was a jobs bill, other Democrats joined by 8 Republicans passed the craziest legislation in this decade yet!

No jobs will be created from this bill, other than for illegal aliens!

President Obama stated that this will definitely "skyrocket" utility costs....why would he support such a piece of legislation?

Every product manufactured in the USA, will now either cost more it it will get manufactured in China...kiss your manufacturing job goodbye. Kiss your truck driving job good buy, kiss your wallet goodbye(did you know that when you exhale you are now polluting)?

Businesses that pollute can do so, by buying credits for such pollution from others who do not...what a great idea from the people who brought you the New Orleans rebuilding effort.

Hope for a kill in the SENATE....and remember who voted to kill your job and raise the cost of everything manufactured trucked or use in the USA....then VOTE in 2010....

US DOLLAR-IS IT A WORLD RESERVE CURRENCY OR PAWN IN INTERNATIONAL POLITICS AND LOSING LONG TERM VALUE DUE TO OUT OF CONTROL DEFICIT SPENDING ?



China holds US TREASURY securities variously estimated at $800 billion, plus another similar amount of various other agency securities. As a result, the USA usually has little to say about Chinese freedom restrictions, errant satellite shoot-downs, and of course rights abuses in Tibet.

The Treasury Secretary traveled to China and continued to urge them to buy US TREASURY securities stating that the dollar is strong ( to laughter ) of the listeners, all of whom spoke English.

Is the dollar under attack? Yes, and it will continue to be a target as long as the government continues its spending spree, budget deficits, high taxes and experiences rising unemployment.

The daily and weekly analysis does little to change the long term fundamentals about the USA which is terribly mismanaged fiscally, and now with the significant and unnecessary tax related to energy (global warming) all US taxpayers will be that much less wealthy.

The dollar declined the most against the euro in a month and dropped versus the yen after China repeated its call for a new global currency.

The Swiss franc declined against the euro and dollar this week as foreign-exchange analysts said the central bank sold its currency three times to support the economy. The greenback fell against most of its major counterparts after the People’s Bank of China said yesterday the International Monetary Fund should manage more of members’ foreign-exchange reserves.

“The dollar’s status as a reserve currency is being questioned,” said Benedikt Germanier, a foreign-exchange strategist in Stamford, Connecticut at UBS AG, the second- largest currency trader. “There are reasons to sell the dollar.”

The U.S. currency fell 0.9 percent to $1.4056 per euro this week from $1.3937 on June 19, the swiftest depreciation since the five days ended May 29. The dollar fell 1.1 percent to 95.18 yen from 96.27, its third consecutive weekly drop. The euro decreased 0.3 percent to 133.85 yen from 134.18.

Federal Reserve policy makers said on June 24 inflation “will remain subdued for some time” and that the economy warrants an “extended period” of low rates.

The 10-year Treasury yield fell the most since March as investors bet the Fed will keep interest rates close to zero for the rest of the year. The difference in yield, or spread, between 2- and 10-year yields decreased this week to 2.43 percentage points, near the narrowest level since May 20.

Stronger Real

Brazil’s real gained 2 percent to 1.9363 versus the greenback, its biggest weekly increase in June, as the sale of shares in Visa Inc.’s local credit-card processing affiliate attracted foreign investors to the world’s biggest initial public offering in more than a year.

The dollar depreciated 2.6 percent to 7.8926 South African rand and 1.4 percent to 7.8002 Swedish krona as the People’s Bank of China said in its 2008 review there’s a need for a global reserve currency “delinked from sovereign nations.”

The Swiss franc declined against the euro and dollar as strategists said the Swiss National Bank sold its currency twice on June 24 and once more a day later to support the economy. Nicolas Haymoz, an SNB spokesman, declined to comment on June 25 on whether the bank acted in foreign-exchange markets.

‘Unwelcome’ Strength

“The SNB has to convince markets that it considers a strong franc as unwelcome,” Unicredit SpA analysts Armin Mekelburg in Munich and Roberto Mialich in Milan wrote in a report yesterday. “We fear that franc bulls will start further attempts to wipe out the line in the sand of 1.50.”

The franc fell 1 percent to 1.5230 against the euro and 0.2 percent to 1.0834 compared with the dollar this week. The Swiss currency declined on June 24 to 1.5380 versus the euro, the weakest level since the mid-March period when the SNB said it intervened to weaken the franc.

The ICE’s Dollar Index fell below 80 on the call from China for an alternative to the dollar as the world’s main reserve currency. The gauge tracking the greenback versus the currencies of six leading trading partners decreased 0.5 percent to 79.90.

“To prevent the deficiencies in the main reserve currency, there’s a need to create a new currency that’s delinked from the economies of the issuers,” the People’s Bank of China, or PBOC, said. China is the biggest foreign holder of U.S. Treasuries, with $763.5 billion in April.

Russia’s Stance

Russian Finance Minister Alexei Kudrin said on June 13 after the Group of Eight meeting in Italy that his country had full confidence in the dollar and that it’s “too early” to speak of alternative reserve currencies. Japan has “unshakable” trust in the strong-dollar policy of the U.S., Finance Minister Kaoru Yosano said in Tokyo yesterday.

China called on the U.S. to guarantee the safety of its assets in March, when Premier Wen Jiabao said the nation was “worried” about its holdings of Treasuries.

People’s Bank Governor Zhou Xiaochuan urged the IMF that month to expand the functions of its unit of account and move toward a “super-sovereign reserve currency.” Russian President Dmitry Medvedev proposed on June 5 that nations use a mix of regional reserve currencies to reduce reliance on the dollar.

“There may be signs here of tensions mounting between the PBOC’s economic concerns over China’s holdings of dollars and the Chinese government’s diplomatic reasons for doing so,” Stephen Gallo, head of market analysis at Schneider Foreign Exchange in London, wrote in an e-mail.

Venezuela’s bolivar plunged yesterday to a seven-week low in unregulated trading after the government said investors won’t be able to use a new $3 billion corporate bond offering to obtain dollars until 2011.

The bolivar fell 4.1 percent to 6.90 bolivars per dollar in the parallel market, traders said. The currency tumbled 20 percent this year in the unregulated market as the government pared dollar sales at the official exchange rate of 2.15 after oil, which accounts for 93 percent of the country’s exports, plunged from last year’s record high.

HERE WE GO AGAIN, BARNEY FRANK WANTS TO RELAX LENDING RULES FOR FANNIE AND FREDDIE!



Two U.S. Democratic lawmakers want Fannie Mae and Freddie Mac to relax recently tightened standards for mortgages on new condominiums, saying they could threaten the viability of some developments and slow the housing-market recovery, the Wall Street Journal said.

In March, Fannie Mae (FNM.N)(FNM.P) said it would no longer guarantee mortgages on condos in buildings where fewer than 70 percent of the units have been sold, up from 51 percent, the paper said. Freddie Mac (FRE.P)(FRE.N) is due to implement similar policies next month, the paper said.

In a letter to the CEO's of both companies, Representatives Barney Frank, the chairman of the House Financial Services Committee, and Anthony Weiner warned that a 70 percent sales threshold "may be too onerous" and could lead condo buyers to shun new developments, according to the paper.

The legislators asked the companies to "make appropriate adjustments" to their underwriting standards for condos, the paper added.

In an interview with the paper, Weiner said the rules have "had a real chill on the ability to get these condos sold," at a time when prices of condos have fallen enough to attract potential buyers.

In addition to the 70 percent sales threshold, Fannie Mae will also not purchase mortgages in buildings where 15 percent of owners are delinquent on condo association dues or where one owner has more than 10 percent of units, as the firm sees these as signals that a building could run into financial trouble, the paper added.

Both Fannie and Freddie are preparing a response to the lawmakers, according to the paper.

Barney started the road to disaster by insisting that lenders need to accommodate MORE deadbeats years ago, and is back to his old ways again.

I'M A BANKER-GET ME OUT OF HERE...TARP RECIPIENTS ARE SCREAMING TO GET OUT FROM FEDERAL "HELP"


"NO THANKS, DON'T NEED YOUR HELP ANYMORE", THE BANKS WHO GOT TARP MONEY ARE SAYING TO THE GOVERNMENT.

JPMorgan Chase & Co. and three of the nation’s largest banks repaid $44.7 billion to the U.S. Treasury’s bailout fund in a step toward ridding themselves of government restrictions on lending and pay.

JPMorgan repaid $25 billion, Morgan Stanley gave back $10 billion, Minneapolis-based U.S. Bancorp refunded $6.6 billion and Winston-Salem, North Carolina-based BB&T Corp. paid $3.1 billion, the companies said today in separate statements.

The banks are among 10 companies that last week said they would repay a total of $68 billion to the Troubled Asset Relief Program after Treasury approved the payments. Banks have unveiled plans to raise more than $100 billion in capital, and financial stocks have climbed in the past three months on signs the global credit contraction is easing.

“Our strong capital position allowed us to pay back TARP in a very short amount of time,” BB&T Chief Executive Officer Kelly King said in the statement. “We’ve repaid the government, and now we have a singular focus on the business of serving our clients.”

JPMorgan, U.S. Bancorp and BB&T also notified the Treasury of their intent to repurchase warrants issued under the program.

New York-based JPMorgan fell 70 cents, or 2 percent, to $32.80 at 12:08 p.m. in composite trading on the New York Stock Exchange. BB&T fell 42 cents, or 1.9 percent, to $21.81, U.S. Bancorp rose 6 cents to $17.92, and Morgan Stanley fell 59 cents, or 2.1 percent, to $27.51.

Goldman Sachs Group Inc., American Express Co., Bank of New York Mellon Corp., Capital One Financial Corp., Northern Trust Corp. and State Street Corp. also said last week they would repay TARP.

Warrant Purchases

The Treasury bought preferred stock and demanded warrants - - the right to buy common stock at a set price for 10 years -- so taxpayers could benefit from any rebound. Typically, the warrants equaled 15 percent of the TARP capital.

JPMorgan and seven other banks may spend about $3.88 billion this quarter related to dividend and interest costs to repay the government, Rochdale Securities analyst Richard Bove said yesterday.

JPMorgan will incur the highest cost, $1.48 billion, to repay TARP, Bove wrote in a note. Morgan Stanley’s cost will be $1.02 billion, he said.

Banks are repaying TARP almost eight months after then- Treasury Secretary Henry Paulson, seeking to quell market panic that followed the Sept. 15 bankruptcy of Lehman Brothers Holdings Inc., provided nine banks with $125 billion from the $700 billion TARP fund passed by Congress.

The government’s stress test of the 19 largest banks last month determined that U.S. Bancorp and BB&T didn’t need any additional capital.

Bank of America Corp., the biggest U.S. bank by assets, and Citigroup Inc. weren’t among banks Treasury cleared to repay TARP. They each accepted $45 billion in U.S. aid. Wells Fargo & Co., the nation’s largest mortgage lender and the recipient of $25 billion in government aid, also wasn’t on the list.

TAKING A LESSON FROM 1938 GERMANY-THE CHRYSLER DEALER CHEATING BY THE GOVERNMENT!-A DODGE DEALER'S PERSPECTIVE


As a loyal and successful Dodge Dealer for over 22 years it is not a big surprise that given the current economy, the marketplace may not support the number of Dealers presently representing Chrysler Corporation products. However, the methodology Chrysler Corporation is attempting to utilize to reduce its Dealer body is unlawful, unconstitutional, un-American and grossly unfair. What Chrysler Corporation is attempting to do, under President Obama’s direction, is to use the United States Bankruptcy Court in New York to terminate 789 Dodge Chrysler Dealer Franchise Agreements, arbitrarily, capriciously, and without due process of law.

The so called “criteria” establishing which Dealers will be terminated20is seriously flawed and “non-transparent”. Many of the Dodge/Chrysler Dealers are profitable, employ many quality employees, support their communities and provide the necessary competition to insure that customers receive competitively priced vehicles. By reducing the number of automobile Dealers you are certain to reduce competition and the undesired effect will be the increased prices that Americans will ultimately pay for the price of a car.

Additionally, Chrysler is proposing to take away my franchise without compensating me for its value. I have invested millions of dollars to acquire the Dodge franchise, the Dealership facility and the real estate.

Chrysler proposes to transfer my franchise and all the goodwill I created over a 22 year span to a Chrysler competitor, across the street, free of charge, without compensating me one cent.

This is occurring despite my Tamaroff Dodge Dealership continuously achieving high sales, high customer satisfaction index ratings, a 5-star Dealer status (Chrysler’s highest achievement award), and over 22 years having built a loyal and satisfied customer base. It is like “Crystal Night” in Nazi Germany in 1938, but instead of the Nazis seizing “private property” without due process of law and compensation, Chrysler and President Obama are using the power of a Federal Bankruptcy Judge to trample and run roughshod over the rights of 789 Dodge/Chrysler Dealers. By using the power and governmental action of the Federal Bankruptcy Court, Chrysler and President Obama are purposely avoiding all state laws and some federal laws which were specifically designed by lawmakers to protect the Dealer from the overwhelming power of the manufacturer. Furthermore, where is the due process for an unconstitutional taking of my franchise rights without just compensation?

My fellow Americans, I am a WWII veteran and former P.O.W. who risked my life for our country to defeat National Socialism and Hitler’s tyrannical Nazi regime. Never in my entire 82 years (50 years as an auto dealer and mechanical engineer) would I have anticipated the President of the United States and an appointed Federal Bankruptcy Judge trampling on my rights, seizing my property and potentially causing me to go into bankruptcy and in the process acting as instruments of FACISM.

President Obama, is this the change you promised the American people? Where is the transparency you promised on the campaign trial?

To add insult to injury, Chrysler Corporation, at this date, will not buy back any of the Dealers’ new car inventory; inventory they pushed on the Dealers in the last 90 days threatening them that if they did not purchase the cars from Chrysler they would be remembered come “termination day.”

Finally, the worst point about this “Executive Branch sponsored taking” is the painful effect of laying off our people, many of whom have been with our company since the beginning. They are like family. It is like throwing your kids out on the street, with no job, no money, and no health care.

It is a heartbreaking experience for the employees, their families and for me.
Recently, President Obama made a public statement that he is standing by the Dealers.

Yes, he is standing on their graves.

Where is his leadership and foresight as he rushes to accomplish his agenda at the expense of 789 Dodge/Chrysler Dealers and their employees?
President Obama and the Obama administration are directly responsible for orchestrating this ill conceived plan.

My fellow Americans, WAKE UP before you lose your livelihood and private property without just compensation.

If the Executive Branch and Judicial Branch can successfully complete this illegal seizure of property and transfer of wealth from one Dealer to another, then is any American’s private property safe from unlawful government seizure?

As the great Prime Minister Margaret Thatcher once said,“The problem with socialism is sooner or later you run out of the other guy’s money.”

God Bless our Constitution, our Bill of Rights, and Our Great Country.

Marvin M. Tamaroff

PUTIN SEEKS TO BE WORLD PLAYER WITH THE RUBLE-OH YEAH, LET'S CHANGE OUR DOLLARS INTO RUBLES AS SOON AS POSSIBLE-NOT!



Russia is hanging on by a thread. other than selling its oil from fields mostly taken over from legitimate producers, it is struggling not to be forgotten on the world scene as a power broker-a world player.

Statistically speaking, Russia has literally no in-immigration and its birth rate is below the level needed to grow the population. In effect, in the next 50-75 years, it will decrease its population by 50 MILLION. It will be down to the population of ENGLAND or less.

So it is struggling to make itself a player, it is always talking big and arming dictators with bombs that don't explode correctly, and out of technology weapons systems, that are sold cheaply to those who want to buy them.

Now his latest proposal is to make the RUBLE a reserve currency along with the dollar and the Yuan. he has become friends with China, they both want to share the world stage....good luck Mr. Putin, don't hold your breath!

MANUFACTURING IN THE USA IS ALIVE AND WELL-AMERICA MAKES THINGS OTHER CAN'T-STILL WORLD LEADER!



The media would have you believe that nothing is made in America any more. But to the contrary, even as manufacturing jobs vanish in low cost products that can be made in China and other low wage countries, it is moving UPSCALE here.

We are the country that makes the jets, the turbines, the big computers, the big earth moving equipment-high value goods.

The USA still leads the world by manufacturing $1.6 TRILLION worth of products, up from $811 billion in 1987.

we still invent more products than anyone, and we still produce the expensive hi-tech stuff too.

So, don't give up yet, we are still world leaders.

POOR NATIONS WANT RICH NATIONS TO BECOME POOR AS WELL-MORE CRAZY IDEAS FROM THE GLOBAL WARMING NUTS AT THE UNITED NATIONS



Crazy ideas like always, tend to get crazy followers to "buy-into" the idea. This is exactly the case with the UN ministers, heads of various obscure panels and advisory councils usually made up of America haters (or democracy haters) at that world body.

Now, the nations that produce nothing but misery, poverty and brutal dictators, want to dictate to the industrial nations that they need to go back to the stone age and become just like them; poor and generally stupid.

They want the CO2 emissions brought to dinosaur era times...well not exactly since it appears that there may have been a toxic atmosphere back then, but at least they want the US and others to move into caves, at the very least and stop driving cars, and maybe stop factory output. America should be like Darfour?

Climate talks ending on Friday made progress towards a new U.N. treaty to curb global warming but fell short of calls by developing nations for the rich to make deep cuts in greenhouse gas emissions.

"I look back on this as a significant session that has advanced our work in important ways," Yvo de Boer, head of the U.N. Climate Change Secretariat (another waste of our money), told a news conference of the June 1-12 meeting among 183 nations.

He said governments staked out far clearer views after a first review of a draft legal text of a treaty due to be agreed in Copenhagen in December to succeed the Kyoto Protocol. It will curb greenhouse gases mainly emitted by burning fossil fuels.

"There is no question that industrialised countries need to raise their sights in terms of mid-term emission cuts," he said, despite recession racking many developed nations.

This genius, De Boer, said cuts presented by rich nations amounted at best to average cuts of up to 24 percent below 1990 levels -- far short of demands by developing nations.

Like they are the ones that should be driving world economic development.

And his number excludes the United States, which plans merely to cut emissions back to 1990 levels by 2020, a cut of about 14 percent from 2007. Including the United States would roughly halve the average cuts by industrialized nations.

Developing countries also called for more. Should we be even giving these "green" morons the time of day?

"We finally managed to have a positive exchange on the numbers" for developed nations, China's climate ambassador Yu Qingtai said. China and the United States are top emitters.

Now let's see if China stops producing the stuff that the USA uses, and the USA stops buying what china produces, the rest of the world could stop counting on the US aid to keep these dinky nations afloat. Their typical dictators would then not be able to build palaces, and perhaps we could save some money.

"I view that as a sign of progress but still we hear repeated statements resisting calls for further meaningful cuts," he added.

China and many developing nations want the rich to cut by at least 40 percent below 1990 levels by 2020 to avoid the worst of global warming set to spur more droughts, floods, rising sea levels, disease and extinction of species of animals and plants.

Oh yeah, and who would China sell to then?

"We have advanced perhaps a couple of miles towards Copenhagen. We still have thousands to go," said Jennifer Morgan of the London-based E3G think-tank.

Start thinking Jennifer!

She said that heads of government, at summits such as the Group of Eight in Italy in June or at the United Nations in September, would have to tackle the deadlock on key issues.

Yeah like we want to maintain a lifestyle living with electric lights and driving our cars.

"We've had a useful discussion about targets -- the first ever since 2005 when negotiations started (in Montreal)," said Alf Wills of South Africa. "That's a first step. The challenge is to convert options into negotiation on numbers."

Japan set a goal on Wednesday of a cut of 8 percent below 1990 levels by 2020, disappointing many delegates.

Outside the talks in a Bonn hotel, protesters brought along two live camels and laid out some sand to illustrate fears of creeping desertification.

How about they ride their camels, instead of the private 747 jets that they travel on instead?

"We spit on weak targets," one banner said, another said: "Shrinking targets, growing deserts".

Suggestion, start drilling for water, instead of developing nuclear arms and hatred.

The chair of a group looking at new actions to curb emissions by all countries said a draft text had swollen with new ideas from about 50 pages to 200. Big breakthroughs were likely to happen only in Copenhagen, he said.

"This is like the evolutionary process in reverse. The Big Bang comes at the end," said Michael Zammit Cutajar, of Malta (another world power).

When will this idiocy end?

DEBT SWAP-CONSUMERS PAY IT OFF WHILE GOVERNMENT PILES ON-NEW WORTH PLUNGES THIS YEAR FOR AMERICANS


As can be expected, consumers tightened their belts, lived within their means as times got tougher, while the government went on a spending binge.

Americans' wealth dropped $1.3 trillion, a Fed report shows a decline of home values and the stock market cut the nation's wealth to $50.4 trillion. Americans saw $1.3 trillion of wealth vaporize in the first quarter of 2009, as the stock market and home values continued to decline, according to a government report released Thursday.

Household net worth fell to $50.4 trillion, according to the flow of funds report by the Federal Reserve. Americans' stock holdings plunged 5.8% to $5.2 trillion, while their home value dropped 2.4% to $17.9 trillion.

The nation's households have now seen their net worth shrink for seven straight quarters. Family net worth had hit an all-time high of $64.4 trillion in the second quarter of 2007, thanks to the housing bubble and a strong stock market.

The results are not surprising. The Standard & Poor's 500 index dropped 11.7% in the quarter, while home values fell 14.2% from the prior-year period, according to Zillow.com.

Though Americans are getting poorer, the rate of decline is slowing. Last year, households' net worth dropped by a record $10.9 trillion, or 17.4%. It ended the year at $51.7 trillion. The fourth-quarter loss of $4.9 trillion, or 8.6%, was the largest quarterly plunge since the Fed started keeping records in 1951.

Americans also continued to pull back on their borrowing. Household debt fell at an annual rate of 1.1% to $13.8 trillion for the first quarter, after contracting 2% in the fourth quarter of 2008. That was the first time household debt shrank.

During the white-hot housing boom, Americans piled on debt. Between 2002 and 2006, annual household borrowing grew at double-digit rates.

Such debt levels are unsustainable and had to come down to restore Americans' household financial health, said Amir Sufi, finance professor at the University of Chicago. This contraction is a major factor behind the recession.

"Household de-leveraging has to happen even though it's painful," Sufi said.

Mortgage borrowing remained flat, after falling for the previous three quarters. Consumer credit, however, dropped at an annual rate of 3.5%, the largest dip in at least 35 years, as people slowed their use of credit cards and auto loans.

The plunge in consumer credit concerns Paul Wachtel, economics professor at New York University's Stern School of Business. It shows that either consumers are not able or willing to borrow.

"The ability of the consumer sector to start spending again is what will pull the economy out of the recession," he said.

Homeowners' equity also fell to a record low 41.4% as values continued their plunge. More than one in five homeowners now owe more than their houses are worth, according to Zillow.com.

Businesses also decreased their borrowing for the first time since 1992, slipping 0.3% for the quarter. The federal government, however, pumped up its borrowing by 22.6% in an attempt to stabilize the economy. Federal debt grew by 39.2% in the third quarter of 2008 and 37% in the fourth quarter.

"WE WILL GIVE YOU NEW PATIENTS, AND YOU MUST ACCEPT THEM AND THE FEES WE PAY YOU FOR THEM!"-THAT'S THE NEW PROPOSED HEALTH CARE PLAN



Socialism, rather Socialist Health care, the American version, is very interesting indeed.

Imagine that you own a little grocery store, and that the government mandates how much you will charge for your products and forces you to sell them to new customers that you do not want, such as having to accommodate them till midnight, instead of the 6 pm you want to go home at?

That's the plan for your health care.

The government wants to FORCE all doctors to accept all patients and to accept their mandated prices for the services that the doctors will provide.

So if a patient comes in for a blood test, he must get it and the doctor will be paid the mandated amount, say $15. That is not really what it costs to get this service, but that is all the government mandates it will pay.

So, the doctor will choose to say for instance that he allows two blood tests a day and that you need to get on the "list" for the test. So come back in 6 months, when there is an opening. Are you starting to understand the new plan?

This is the case with everything. Do you think that a surgeon wants to schedule $150 operations, and do 10 a day over 10-12 hours ? I do not think so.

This is no way to provide health care.

This similar program already operates in other Federal programs like Medicare. The payment rates are usually so low, that the doctors accepting it only do so because they get a regular reimbursement that is reasonable from private insurance clients, and simply can add several patients with Medicare to add to their client billings.

The government knows this, and thus many doctors, the really good popular doctors in specialty fields, do not accept any more patients, as they can not operate their practices profitably with government reimbursements only.

In the UK for instance, all the best doctors are private practices, and the government run medical services are importing doctors from India, Philippines and other countries. Their last names are un-pronounceable.

The diagnostic options such as MRI screenings, etc, will have to be rationed as well, since the operating costs are significant due to the initial investment. Nobody will invest millions into diagnostic equipment if they can't recover their money due to the small payments for service.

College majors that are now most popular include Political Science, since that is the only projected growth field for future careers.

Why would anyone want to go into medicine with all the anticipated deluge of low paying work?

As the health care debate heats up, the American Medical Association is letting Congress know that it will oppose creation of a government-sponsored insurance plan, which President Obama and many other Democrats see as an essential element of legislation to remake the health care system.

The opposition, which comes as Mr. Obama prepares to address the powerful doctors’ group on Monday in Chicago, could be a major hurdle for advocates of a public insurance plan. The A.M.A., with about 250,000 members, is America’s largest physician organization.

While committed to the goal of affordable health insurance for all, the association had said in a general statement of principles that health services should be “provided through private markets, as they are currently.” It is now reacting, for the first time, to specific legislative proposals being drafted by Congress.

In the presidential campaign last year and in a letter to Congress last week, Mr. Obama called for a new “public health insurance option,” which he said would compete with private insurers and keep them honest.

Speaker Nancy Pelosi of California said Wednesday that she supported that goal. “A bill will not come out of the House without a public option,” she said Wednesday on MSNBC.

But in comments submitted to the Senate Finance Committee, the American Medical Association said: “The A.M.A. does not believe that creating a public health insurance option for non-disabled individuals under age 65 is the best way to expand health insurance coverage and lower costs. The introduction of a new public plan threatens to restrict patient choice by driving out private insurers, which currently provide coverage for nearly 70 percent of Americans.”

If private insurers are pushed out of the market, the group said, “the corresponding surge in public plan participation would likely lead to an explosion of costs that would need to be absorbed by taxpayers.”

While not the political behemoth it once was, the association probably has more influence than any other group in the health care industry. Lawmakers seek its opinion and support whenever possible. It has repeatedly persuaded Congress to cancel or postpone cuts in Medicare payments to doctors, though it has not secured a “permanent fix.”

If the doctors are too aggressive in fighting the public plan, they risk alienating Democrats whose support they need for legislation to increase their Medicare fees.

The group has historically had a strong lobbying operation, supplemented by generous campaign donations. Since the 2000 election cycle, its political action committee has contributed $9.8 million to Congressional candidates, according to data from the Federal Election Commission and the Center for Responsive Politics. Republicans got more than Democrats in the four election cycles before 2008, when 56 percent went to Democrats.

Robert Gibbs, the White House press secretary, said that in his address to the group next week, Mr. Obama would “outline the case for health care reform and make clear why we can’t afford to wait another year, or another administration, to bring down costs that are crushing families, businesses and government.”

Mr. Gibbs did not say whether Mr. Obama would discuss a public insurance plan, the most contentious issue in the debate.

The A.M.A., an umbrella group for 180 medical societies, does not speak for all doctors. One group, Physicians for a National Health Program, supports a single-payer system of insurance, in which a single public agency would pay for health services, but most care would still be delivered by private doctors and hospitals. In recent years, some doctors have become so fed up with the administrative hassles of private insurance that they are looking for alternatives.

Until now, stakeholders in the health care industry have generally muted their criticism of Democratic proposals. But as details of the legislation have emerged, the criticism has become more pointed.

America’s Health Insurance Plans, a lobby for insurers, said Tuesday that the government plan proposed by some Senate Democrats could “dismantle employer-based coverage and significantly increase costs for those who remain in private coverage.”

Under a proposal favored by many Democrats, doctors who take Medicare patients would also have to participate in the new public plan. Democrats say that requirement is needed to make sure the public plan can go into business right away with a large network of doctors.

The medical association said it “cannot support any plan design that mandates physician participation.” For one thing, it said, “many physicians and providers may not have the capability to accept the influx of new patients that could result from such a mandate.”

“In addition,” the A.M.A. said, “federal programs traditionally have never required physician or other provider participation, but rather such participation has been on a voluntary basis.”

In an interview, Dr. Nancy H. Nielsen, president of the American Medical Association, said she was delighted by Mr. Obama’s plan to address the doctors.

“Health care reform is as important to us as it is to him,” Dr. Nielsen said. “We will be engaged in discussions in a constructive way. But we absolutely oppose government control of health care decisions or mandatory physician participation in any insurance plan.”

Mr. Obama’s trip recalls a speech to the A.M.A. in Chicago on June 13, 1993, by Hillary Rodham Clinton. She proposed “a new bargain” in which the White House would limit malpractice lawsuits and free doctors from onerous rules if doctors supported her effort to overhaul the health care system.

The association agrees with Mr. Obama on some points. It says that individuals and families who can afford coverage should be required to obtain it.

Hello, most already have it and pay for it.

FIAT IS BACK!-NOBODY WANTED TO BUY ITS CARS FOR GOOD REASON IN AMERICA-THEY WERE CRAPPY! BONDHOLDERS BEWARE, US GOVERNMENT WILL TOSS ASIDE YOUR LIENS



FIAT whatever, now got a stake in Chrysler for FREE, while the secured bondholders got "fiatted".

If you are a secured bondholder, AND THE GOVERNMENT GETS INVOLVED, the Supreme Court will also seek to screw you in siding with the Chavez mentality of the new administration.

Secured bondholder, so what, you get nothing, and the UAW gets everything.

Will that be the fate of other companies? The stockholders get nothing, the bondholders get nothing and the employees take over for nothing?

Seems that way.

FIAT, an auto builder who last sold cars in the USA decades ago, you know the crappy little lightweight really rusty ones that would always break down, and there would be a lack or parts.....that FIAT, now will provide its "technology" to Chrysler. For that it got to own stock and its stake can grow further.

Basically, now the UAW, US government and FIAT own Chrysler.

Stockholders got the shaft, bondholders got the shaft, dealers who were tossed out got the shaft, and the taxpayers got the shaft.

Now what do you think of the future of such a company ?

Fiat SpA bought a stake in most of Chrysler LLC’s assets, creating the world’s sixth-largest carmaker in Chief Executive Officer Sergio Marchionne’s plan to survive the recession by setting up a global alliance.

Fiat, Italy’s biggest manufacturer, will own 20 percent of the newly formed Chrysler Group LLC and is aiming for a 35 percent stake if certain operational goals are achieved, the companies said today in a statement. The United Auto Workers’ union retiree health-care trust fund will be the biggest owner, with 55 percent when Fiat reaches its target holding.

The combined carmaker would have sales of 4.5 million vehicles globally, ranking just behind Ford Motor Co. based on 2008 figures. Marchionne is pushing for consolidation in the auto industry because he expects only six global producers to survive the first global recession since World War II.

“Marchionne will be focused on restructuring Chrysler, but he’s still looking for other possible mergers and acquisitions,” said Karim Bertoni, who manages the equivalent of $18.5 billion at Banque Syz in Geneva and doesn’t own Fiat stock.

Fiat rose 36 cents, or 4.9 percent, to 7.79 euros in Milan trading, the biggest gain in five weeks. The shares have increased 70 percent this year, valuing the Turin, Italy-based carmaker at 9.39 billion euros ($13.1 billion).

The Italian company isn’t providing any cash for its stake, instead contributing technology such as engines and vehicle designs that Chrysler has valued at as much as $10 billion.

Russia, Latin America

The U.S. government will hold 8 percent of the new Chrysler and Canada will own 2 percent, the companies said. Fiat will help Chrysler, which is based in Auburn Hills, Michigan, sell cars in Russia and Latin America, they said.

Until Fiat gets its additional 15 percent, the ownership breakdown is 20 percent by the Italian company, 9.85 percent by the U.S., 2.46 percent by Canada and 67.69 percent by the UAW retiree medical fund, according to bankruptcy court documents.

The transaction is Marchionne’s first toward his goal of selling 6 million cars a year, the minimum he says is required to be profitable through the economic contraction. Chrysler, which shut its 22 U.S. factories on May 1, didn’t receive any other bids for its assets.

Marchionne already realigned Chrysler’s management, installing a new chief financial officer and putting new leaders in charge of the individual brands.

Opel Offer

Fiat also made a non-cash offer in May for General Motors Corp.’s Opel and Vauxhall brands in Europe. Magna International Inc., Canada’s biggest car-parts maker, was chosen at the end of last month as preferred bidder for the GM Europe division and is in talks on completing the takeover.

Most of Chrysler’s operations will be shifted to the new company, excluding eight factories, dozens of pieces of real estate, equipment leases and contracts with 789 U.S. auto dealerships. Among the agreements excluded are vehicle-assembly and wholesaling ventures in Canada and Mexico with Daimler AG, its former owner, and a contract hiring investment bank Lazard Ltd. to help sell the Dodge Viper sports-car operations.

Chrysler filed for bankruptcy protection on April 30, using the reorganization to retain what it considers its strongest assets and form an alliance with Fiat. The U.S. and Canadian governments are financing the Chrysler sale with $2 billion and are loaning the new company $6 billion for operations.

Performance Goals

Fiat has the option of raising its stake to 35 percent by meeting performance goals, including building a Fiat car in the U.S., selling Chrysler vehicles in foreign markets and offering a car that gets 40 miles per gallon or more in the U.S.

The sale will let the U.S. carmaker revive its Chrysler, Jeep and Dodge brands with less debt and lower wage costs as Fiat provides technology, platforms and knowledge. Fiat built just over 2 million cars last year, ninth worldwide.

The U.S. Supreme Court overturned objections to the transaction by Indiana state pension funds and U.S. consumer advocates, ruling yesterday that the challenges didn’t meet the legal standard for an emergency stay of the deal.

Marchionne becomes the CEO of the new company and Robert Kidder, former chairman and CEO of Borden Chemical Inc. and Duracell International Inc., is chairman. Jim Press, one of Chrysler LLC’s two presidents, was named deputy CEO, while Peter Fong, director of the Mid-Atlantic Business Center, will be group sales chief and run the Chrysler brand.

Michael Manley, Chrysler LLC’s international sales chief, will oversee the Jeep division and Michael Accavitti will lead Dodge, where he has been head of marketing. Richard Palmer becomes Chrysler Group’s chief financial officer, shifting from the same post at Fiat’s automotive group.

The pairing of Chrysler and Fiat brings together companies with largely different products and markets. Chrysler gets more than 90 percent of its sales from North America through its three brands. Fiat has almost no presence on the continent.

The Italian automaker has the most fuel-efficient lineup of vehicles in Europe while Chrysler is known for V8-powered large sedans, sport-utility vehicles and pickups. Chrysler may begin selling the first Fiat vehicles in as little as 18 months, executives at both companies have said.

Just what we need more cars nobody wants to buy.

SBA "ARC" LOAN PROGRAM FOR SMALL BUSINESSES WILL ALLOW $35,000 LOANS TO EVEN PAY YOUR CREDIT CARD BILLS AND OTHER BILLS AND LOAN PAYMENTS



Does your small business need up to $35,000 in quick cash for meeting necessary bills and even personal credit card payments (if you used the money for your business)?.

Well then here is your personal bailout plan, if you can meet its requirements.

One week before its emergency loan program is slated to launch, the Small Business Administration issued guidelines for banks and borrowers on how the new loans will work.

Called "America's Recovery Capital," ARC loans are designed to make up to $35,000 available to struggling small business owners to temporarily help them keep up with payments on existing loans, including credit card debt. Authorized as part of February's stimulus bill, the program has been under development for four months. Many banks were waiting for the SBA's procedural guidance, released Monday, before deciding whether or not to participate.

Here's a primer on how the emergency loans will work.

Eligibility: Sorry, startups, this isn't for you. ARC loans are only open to businesses that have been in operation for at least two years and have been profitable in at least one of the last two years. (Startup businesses can apply for financing through other SBA programs, including the agency's flagship 7(a) loan program.)

Borrowers can use ARC loans to make payments for up to six months on their existing debt, with no repayment due on the loan for another year. After that, the business has five years to pay back the loan principal. The government covers the interest payments.

Applicants must prove they are experiencing financial hardship, as evidenced by declining sales (a drop of at least 20% over the past year), frozen credit lines, rising business costs (again, 20% or more in the past year), or difficulty meeting payroll, paying rent or making loan payments.

But borrowers also have to be running a "viable" business. The SBA wants to see cash-flow projections for at least the next two years illustrating that the business will be able to repay its ARC loan and other debt obligations. Borrowers must have "acceptable" business credit scores, and they can't be more than 60 days past due on any loan they'd like ARC funds to help cover. Lenders may also require collateral to back up the loan.

Qualifying debt: Because of arcane government rules, ARC loans can't be used to make payments on loans backed by the SBA before Feb. 17, 2009, the date the stimulus bill took effect. However, borrowers can use the loans for relief from virtually any other business debt, including a commercial mortgage or lease, home equity loans used to finance business operations, bank loans made outside the SBA program, notes payable to suppliers, and credit card debt.

That last one is a key feature. Borrowers can use ARC loans to cover payments on their personal credit cards if the money was borrowed for business expenses. "We do recognize the merging of the owners' and businesses' finances," says Eric Zarnikow, the SBA's associate administrator for capital access.

How to apply: The SBA won't make ARC loans directly. As with most of its lending programs, it will instead offer guarantees on loans made by banks. If the business owner defaults, the SBA pays off the debt. (The business owner still takes a hit on their credit report.)

Each bank will set its own procedures and timeline for issuing loans, so business owners looking to apply should contact a participating bank. For a list of banks that make SBA loans, click here. Each business can receive only one ARC loan, for a maximum of $35,000, but that loan can be used to make payments on more than one debt.

The SBA will begin processing applications for the loans on June 15, but individual banks may take longer to draft their own application procedures.

What's in it for banks: ARC loans are a sweet deal for borrowers: They carry no fees, require no payments for at least a year, and have their interest payments fully subsidized by the government.

That, and the fact that they're specifically targeted at businesses in trouble, makes them especially risky. Banks have been wrangling with the SBA for years about underwriting standards for their small business loans: The government can penalize lenders for high default rates in their portfolios, which has made some banks nervous about participating in the ARC loan program. Collecting the government guarantee on a loan gone bad can be onerous, and banks have to absorb the administrative costs of pursuing delinquent loans and liquidating those that default. The SBA says it expects ARC loans to default at a higher rate than its other programs, and will adjust its expectations for lenders accordingly.

Because the loans are fully guaranteed by the government, ARC loans are fairly safe for banks. But the interest rate on them isn't very competitive. The SBA has set the interest rate it will pay for the loans at prime plus 2%. For June, that rate would be 5.25%.

That's a lower interest rate than the SBA sets for its other loan programs. However, unlike ARC loans, those programs don't offer a 100% loan guarantee -- on a traditional SBA loan, if a business defaults, banks would be stuck with some of the loss.

Availability: The SBA estimates that around 10,000 small businesses will receive ARC loans, but it's uncertain how quickly the loans will be dispersed. "It's a little challenging to anticipate what the demand will be," Zarnikow says. "There will be ramp-up time as lenders train operators."

In the Recovery Act, Congress allocated $255 million to support the ARC loan program. That money covers only the program's subsidies, for interest payments and defaults, allowing the money to stretch to support a larger dollar-volume of lending. Each lender will be limited to 50 loans per week. If a bank makes less than 50 loans, they can carry the unused allocation over to other weeks, but lenders will be capped at a maximum of 1,000 loans through the program's duration.

The ARC loan program is scheduled to run through Sept. 30, 2010, or until its funding runs out, whichever comes first.

DOW JONES INDUSTRIAL AVERAGE REPLACES GM AND CITI WITH CISCO AND TRAVELERS-AVERAGE WOULD BE 300 POINTS HIGHER IF THEY WERE IN IT EARLIER




The announcement that two of the long time DOW components (GM and CITI) were going to be substituted, did not get a lot of press, but that substitution could have major implications for the calculation of the DOW AVERAGE that is so widely publicized.

Some financial analysts did a "what of" analysis to test to see if the two new member components of the DOW; CISCO AND TRAVELERS.

They discovered, that this type of substitution would have had a major effect on the DOW AVERAGE figure that is reported daily. They estimated that if those two stocks were in the DOW for the last 12 months, the DOW would be approximately 300 POINTS HIGHER than reported!

So imagine what that would be like? Is it a run away market, is it a new bull market rally?

The DOW is watched so much and reported daily on all the financial newscasts, yet it could be significantly erroneous or not based on who the components are. So by substituting the stocks, and many other throughout its long history, the distortions could have major implications.

General Motors Corp. and Citigroup Inc., crippled by the first global recession since World War II, were removed from the Dow Jones Industrial Average and replaced by Cisco Systems Inc. and Travelers Cos.

GM, which filed for bankruptcy protection today, and Citigroup, the recipient of $45 billion in taxpayer aid, became the first companies since American International Group Inc. in September to leave the 30-stock average. Their shares have lost more than 90 percent since the start of 2007.

By replacing GM with Cisco, Dow Jones & Co. has removed automakers from the best-known benchmark for U.S. stocks, saying in an e-mailed statement that computers are as central to the economy as cars were in the previous century. Citigroup, until last year the world’s biggest financial firm by assets, is being replaced by a company it jettisoned in 2002 and that was once run by its former chairman, Sanford “Sandy” Weill.

“This announcement brings front and center the challenges facing the U.S. economy as it strives to remain competitive,” said Alan Gayle, director of asset allocation at Ridgeworth Investments, which manages $60 billion in Richmond, Virginia. “The Dow Jones Industrial Average is becoming less of an industrial average. It’s trying to reflect the broader economy.”

Below $5

Citigroup has traded below $5 a share since mid-January and is in the process of converting $52.5 billion of preferred stock into common shares, giving the U.S. government a 34 percent stake. GM’s ouster was foreshadowed in May by John Prestbo, the Dow Jones & Co. editor in charge of indexes, who said it would be removed in a bankruptcy filing.

GM, whose shares will be suspended on the New York Stock Exchange by the end of the day, closed unchanged at 75 cents. Citigroup fell 0.8 percent to $3.69.

“The parlous state of GM has left us with no choice but to remove it from the Dow,” said Robert Thomson, managing editor of the Wall Street Journal, in a statement announcing the change. The newspaper’s editors decide the makeup of the average. News Corp., the media company headed by Rupert Murdoch, has been its publisher since acquiring Dow Jones in 2007.

Travelers Merger

Citigroup, based in New York, was formed in 1998 from the merger of Travelers Group Inc. and Citicorp. In 2002, Citigroup gave up control of Hartford, Connecticut-based Travelers Property Casualty Corp. through an initial public offering and subsequent spinoff. The bank earned $1.6 billion in the first quarter of 2009, ending five straight quarters of losses totaling $37.5 billion.

“We were reluctant to remove Citigroup at the height of the financial frenzy, but it is clear that the bank is in the midst of a substantial restructuring which will see the government with a large and ongoing stake,” Thomson said.

Thomson said Citigroup may be considered again after it has “refashioned itself,” according to the statement.

Cisco, the world’s largest maker of computer-networking equipment, joins Microsoft Corp., International Business Machines Corp., Intel Corp. and Hewlett-Packard Co. in the Dow, boosting its technology weighting from about 17 percent. With the addition of San Jose, California-based Cisco, computer companies will close the gap with industrials including 3M Co., the largest category with about 18.5 percent.

Cisco gained 5.4 percent to $19.50, outpacing a 2.6 percent advance by the Standard & Poor’s 500 Index.

Bank Shares

Travelers, the second-biggest U.S. commercial insurer, joins JPMorgan Chase & Co., American Express Co. and Bank of America Corp. among financial companies in the Dow. Its higher price than Citigroup’s will boost the benchmark’s financial weighting to about 10 percent from about 7 percent. Financials make up about 14 percent of the S&P 500, a broader benchmark.

The choice of New York-based Travelers restored an insurer to the Dow average, which had lacked one since the removal of AIG. Travelers rose 3.1 percent to $41.91.

Kraft Foods Inc. was named to replace AIG in the Dow average on Sept. 18, the day after the nation’s biggest insurer was taken over by the U.S. government to avert its collapse.

GM, which had its last profitable year in 2004, was the worst-performing company in the average last year, losing 87 percent, and 77 percent this year through May 29. Its shares fell below $1 on May 29, putting them below the minimum normally required to trade on the NYSE. GM, based in Detroit, entered the 113-year-old index in 1915, replacing preferred shares of U.S. Rubber.

GM has been in the Dow average continuously since 1925. Only General Electric Co., a component since 1907, has been in the index longer. Travelers joined in 1997, and the company’s name changed to Citigroup in 1998.

Biggest Bankruptcies

GM, the fourth-biggest bankruptcy in U.S. history after Lehman Brothers Holdings Inc. and Washington Mutual Inc. in September and WorldCom Inc. in 2002, had been the lowest-priced company in the average for most of the past year. Citigroup closed at lower prices than GM on 27 days this year, mostly in March. The Dow average is price-weighted, meaning the lower a company’s share price, the less influence it has.

GM and Citigroup were taken out from News Corp.’s 150-stock Global Dow in April, less than five months after that index was introduced.

“The issues facing GM have been widely known and disseminated for some time,” said Jonathan Armitage, head of U.S. large-cap equities at the American unit of Schroders, the U.K.’s largest independent money manager. “It was less a question of if but of when” this day would come.

The Dow average was devised in 1896 by Charles H. Dow, co- founder of Wall Street Journal publisher Dow Jones & Co. Originally containing 12 stocks, it expanded to 20 companies in 1916 and to 30 in 1928.

Reputation, Growth

There are no rules for inclusion in the gauge, according to the Dow Jones Web site. Usually, a stock is added only “if it has an excellent reputation, demonstrates sustained growth, is of interest to a large number of investors and accurately represents the sectors covered by the average,” the Web site says.

Changes in the composition of the average “are rare, and generally occur only after corporate acquisitions or other dramatic shifts in a component’s core business,” the site says. “When such an event necessitates that one component be replaced, the entire index is reviewed,” and “multiple component changes are often implemented simultaneously.”

Three companies left the Dow last year, including AIG. Altria Group Inc. and Honeywell International Inc. were replaced by Bank of America and Chevron Corp. Those changes were the first since 2004.

HOMES FOR SALE INVENTORY LIKELY TO STAY HIGH FOR A LONG TIME; FORECLOSURE SALES WILL OVER-HANG THE MARKET FOR A LONG TIME



From The Business Insider, June 9, 2009:

House prices are finally approaching fair value. Unfortunately, unless the housing bubble behaves differently than almost every bubble before it, house prices will now crash right through fair value and stay below it for a number of years (HOW MANY YEARS IS ANYBODY'S GUESS.).

When prices do finally bottom, moreover, they aren't likely to recover quickly.

Whitney Tilson and Glenn Tongue of T2 Partners have put together an excellent presentation on the housing and mortgage markets.

Here's Whitney and Glenn's take on the future of house prices:

We think housing prices will reach fair value/trend line, down 40% from the peak based on the S&P/Case-Shiller national (not 20-city) index, which implies a 5-10% further decline from where prices where as of the end of Q1 2009. It’s almost certain that prices will reach these levels.

* The key question is whether housing prices will go crashing through the trend line and fall well below fair value. Unfortunately, this is very likely.

In the long-term, housing prices will likely settle around fair value, but in the short-term prices will be driven both by psychology as well as supply and demand. The trends in both are very unfavorable.

* Regarding the former, national home prices have declined for 33 consecutive months since their peak in July 2006 through April 2009 and there’s no end in sight, so this makes buyers reluctant – even when the price appears cheap – and sellers desperate.

* Regarding the latter, there is a huge mismatch between supply and demand, due largely to the tsunami of foreclosures. In March 2009, distressed sales accounted for just over 50% of all existing home sales nationwide – and more than 57% in California. In addition, the “shadow” inventory of foreclosed homes already likely exceeds one year and there will be millions more foreclosures over the next few years, creating a large overhang of excess supply that will likely cause prices to overshoot on the downside, as they are already doing in California.

* Therefore, we expect housing prices to decline 45-50% from the peak, bottoming in mid-2010.

* We are also quite certain that wherever prices bottom, there will be no quick rebound

* There’s too much inventory to work off quickly, especially in light of the millions of foreclosures over the next few years

* While foreclosure sales are booming in many areas, regular sales by homeowners have plunged, in part because people usually can’t sell when they’re underwater on their mortgage and in part due to human psychology: people naturally anchor on the price they paid or what something was worth in the past and are reluctant to sell below this level. We suspect that there are millions of homeowners like this who will emerge as sellers at the first sign of a rebound in home prices

* Finally, we don’t think the economy is likely to provide a tailwind, as we expect it to contract the rest of 2009, stagnate in 2010, and only then grow tepidly for some time thereafter.

CRAZY CHRYSLER BOARD OR CRAZY GOVERNMENT MEDDLING CLOSES LONG ESTABLISHED DEALERSHIPS BY CANCELLING THEIR FRANCHISES; GOVERNMENT GONE WILD!



The number one goal for a business is to grow the business, to increase its revenues and profits and therefore its longevity. However, now that the government got involved, that business plan is out the window, and a new plan is now in place; a stupid plan as only can be expected from the government.

Chrysler, the long lived original member of the BIG THREE, has bought into the most ridiculous idea ever hatched by bureaucrats; close down dealerships which sell the cars it produces, to "help" the company succeed and prosper.

The Balzekas Chrysler dealership in Chicago was started in 1919 by a Lithuanian immigrant to serve the local ethnic neighborhood, and was notified that its franchise will be canceled, and told to fend for itself.

Now keep in mind that this is one of the few car dealerships still operating in Chicago, which has now the highest sales tax rates in the nation, the highest gasoline prices, the highest employment taxes, the highest unemployment rates in Illinois, the highest property taxes in Illinois, etc...it has been fighting to remain in business helping the local area stay viable as a neighborhood.

One of the best ways to expand the business of selling cars is to have as many dealerships as possible selling cars. That is good for the buyers who can make the dealers compete on price and service. That is also good for the factory which can offer local service and visibility.

But, no that is not the way the government sees it. They want Chrysler to close the dealerships which do not sell a lot of cars. Heck, having a dealership that can sell one car a week is better than no cars sold, right?

Dumb, and dumber...the new name of the Chrysler Board of Directors, and its government handlers.

This same story plays out all over the country as 789 dealers have been told to "get lost."

The company has come up with lots of excuses, none of them of course address the simple concept that these dealers cost Chrysler nothing.

They actually have as one of the reasons for the cancellations being that sch dealers are "not that profitable" they make make a profit of $100,000 or less, and that is the reason given.

Well smart guys, let's give you a short lesson in HOW TO RUN A BUSINESS.

Let's say that a dealership sells 100 cars a year, just like the ones you are getting rid of. let's assume that the average car/truck sells for $30,000, thus generating $3,000,000 in new car sales. That same dealership probably sells another 100-200 used cars and takes many in trade to sell a new car, thus generating another $3,000,000 in revenues.

If we use the BALZEKAS dealership example, it also means that the dealership paid approximately $600,000 in sales taxes, $60,000 in real estate taxes, paid salaries of millions, bought local services, employed local people who each had mortgages to pay and families to feed.

None of this cost Chrysler anything, but supported the local community.

So after they paid all their expenses, paid all their cars off, paid all their bills and employed people in the highest tax rate jurisdiction in the country, they made a profit of $100,000...so what's wrong with that? That $100,000 left over created a lot of money in between for lots of people.

Chrysler needs a new motto..when it exits bankruptcy using its RAM logo that it uses for its truck line; my suggestion-"DUMB AS AN OX".

As consumers we get to make a choice too, choose another car, choose one that the Balzekas dealership will sell in the future, but not a Chrysler, they do not deserve your business.

By the way over the years I had three Chryslers a 300,a New Yorker, and a Dodge Duster, and had great memories of these great road cars. Now I'll be looking at a car not mandated by or made under the thumb of the government.

MOVING OUT OF AMERICA AND STAYING OUT-TAX PROPOSAL WILL KILL USA GROWTH AND SINK ECONOMY; MICROSOFT PLANS TO MOVE EMPLOYEES OUT OF THE USA



I’ve finally figured out the Obama economic strategy. President Barack Obama and his team have been having so much fun wielding dictatorial power while rescuing “failed” firms, that they have developed a scheme to gain the same power over every business. The plan is to enact policies that are so anticompetitive that every firm needs a bailout.

Once that happens, their new pay czar Kenneth Feinberg can set the wage for everybody and Rahm Emanuel can stack the boards of all of our companies with his political cronies.

I know, it sounds like an exaggeration. But look at it this way. If there were a power ranking of U.S. companies, like the ones compiled by football writers for National Football League teams, Microsoft would surely be first or second to Google. But last week, Microsoft Chief Executive Officer Steve Ballmer came to Washington to announce what Microsoft would do if Obama’s multinational tax policy is enacted.

“It makes U.S. jobs more expensive,” Ballmer said, “We’re better off taking lots of people and moving them out of the U.S.” If Microsoft, perhaps our most competitive company, has to abandon the U.S. in order to continue to thrive, who exactly is going to stay?

At issue is Obama’s policy to end the deferral of multinational taxation.

The U.S. now has about the highest combined corporate tax rate, second only to Japan among industrialized countries. That rate is so high that U.S. firms have an enormous disadvantage versus competitors. The average corporate tax rate for the major developed countries in the Organization for Economic Cooperation and Development in 2008 was about 27 percent, more than 10 percentage points lower than the U.S. rate.

Tax Burden

U.S. firms have nonetheless prospered because our tax code allows a business to set up a subsidiary in a low-tax country. When that subsidiary earns profits, they are taxed at the rate of that country, and don’t face U.S. tax until the money is mailed home.

The economically illiterate partisan Democratic view is that this practice is unpatriotic and bleeds jobs from the U.S. The economic reality is that American companies use this approach to acquire market share overseas. The alternative is losing the business to foreign competitors.

Don’t just take my word for it. A recent paper by Harvard economists Mihir Desai and C. Fritz Foley and Berkeley economist James Hines and published in the distinguished American Economic Review, gathered data on American multinationals to explore the impact of foreign investments on domestic U.S. activity.

Encourage Overseas Sales

Their conclusion was striking. The authors found that “10 percent greater foreign capital investment is associated with 2.2 percent greater domestic investment, and that 10 percent greater foreign employee compensation is associated with 4 percent greater domestic employee compensation. Changes in foreign and domestic sales, assets, and numbers of employees are likewise positively associated; the evidence also indicates that greater foreign investment is associated with additional domestic exports and R&D spending.”

So when firms expand their operations abroad, taking advantage of the lower foreign tax rates, it helps their workers in the U.S. Higher sales abroad (surprise, surprise) are good for domestic workers.

It is worth noting that this study, which is confirmed by a boatload of evidence elsewhere, was coauthored by the same James Hines who recently wrote a sweeping review of international tax policy with Obama’s top economist, Larry Summers. Summers has to know what the literature says.

Inexplicable Stance

So the question is, why does Obama advocate a policy that so flies in the face of everything that economists have learned? How could Obama possibly say, as he did last month, that he wants “to see our companies remain the most competitive in the world. But the way to make sure that happens is not to reward our companies for moving jobs off our shores or transferring profits to overseas tax havens?” Further, how could Treasury Secretary Tim Geithner call a practice that top scholarship has shown increases wages and employment in the U.S. “indefensible?”

I have to admit I am at a loss. Maybe it is good politics to bash American corporations, and Obama isn’t really serious about making this change happen. But if the change is enacted, and domestic corporate taxes aren’t reduced to offset the big tax hike, the result will be a flight from the U.S. that rivals in scale the greatest avian arctic migrations.

If that occurs, the firms that stay in the U.S. will be at such a huge tax disadvantage that they will absolutely need a “rescue.”

Kevin Hassett, director of economic-policy studies at the American Enterprise Institute

LAND OF THE FREE, NO MAKE THAT OF THE FREELOADER!-ALSO THE REASON NEWSPAPERS ARE NOT SELLING-THEY ONLY HAVE ADS, AND LITTLE NEWS!







All those billions and billions of STIMULUS money, your money going down a seemingly bottomless pit. Do you feel the redistribution of your money?

Did you or your family feel any of the stimulus yet?

The administration's promises of a quick fix looks like a thud, a dud.

Today, there are signs of a forced health care program for everyone proposed by Senator Kennedy and other administration officials. Nobody has looked at how "well" that has worked in Massachusetts, where the program is bankrupting itself as well as the entire state.

Kennedy wants to force all employers to pay into a program for health care if the employer does not provide it directly through the job.

Oh and also, all prior health issues would be assumed...has anyone even considered that cost to an employer?

Would an employer hire a new employee who needs the health care, and let's just assume that it is a family plan, and let's assume that it will cost the employer $1,000 a month. So why would someone hire a worker who is paid $1,500 a month, when another $1,000 needs to be paid for the health care?

Now proposals are being thrown around that the entire health care program can be funded by taxing high income people! Yeah, right!

Let's not get complacent thinking that the government, which has to date produced nothing but failed or bankrupt programs, is somehow going to provide a successful health care program that will provide excellent care for LESS money?

Where is the cool aid that they are drinking?

The other hidden agenda is to provide care for undocumented aliens within this program. What's that all about?

Can someone justify the recovery of the economy as a result of this health care proposal?

How is that an unemployed worker in the auto industry for instance, going to benefit
from being forced into paying health care premiums, or that person's future employer wanting to hire him?.

The Massachusetts Health Reform Law of 2006 expanded Medicaid coverage for the poor and made available subsidized, Medicaid-like coverage for additional poor and near-poor residents of the state. It also mandated that middle-income uninsured people either purchase private health insurance or pay a substantial fine ($1,068 in 2009). Smaller fines (up to $295 per employee) were also levied on employers who fail to offer insurance benefits.

The reform law has not achieved universal health insurance coverage, although half or more of the previously uninsured now have some type of insurance policy.

The reform failed to reduce overreliance on expensive, high-technology services. Indeed, some of its provisions such as changes in Medicaid rates and cuts to safety-net providers (who do more primary care) have further tilted health spending toward expensive, high-technology care.

A single-payer system of non-profit national health insurance could save about $8-$10 billion annually in the state through reduced administrative costs. This money could be used to cover all of the state's uninsured residents and to improve coverage for those who now have insurance, without any increase in total health care costs.

The Massachusetts reform law is not providing universal access to care, even in a state with highly favorable circumstances, including previously high levels of spending on health care for the poor, high personal incomes, and low rates of uninsurance. It is not a model for the nation.
See also:
Proposal for Single-Payer National Health Insurance
Source: Journal of the American Medical Association

Did anyone notice the election in Europe that bounced out the Socialists throughout the continent? Thus Socialists are out everywhere, except in the USA where they are now in.

LET'S WATCH THE UNEMPLOYMENT RATE SKYROCKET EACH MONTH NOW. REMEMBER WE HAVE MILLIONS OF COLLEGE AND HIGH SCHOOL GRADUATES STARTING WORK (WANTING TO START) OVER THE NEXT FEW MONTHS.

This group will not be shown in the unemployment rolls since they have not yet worked, so the number will not really reflect the real state of the economy.

The bigger question would be where will they be working?

An interesting note on this subject. This last Sunday, I pulled out the JOBS section from the usually thick Sunday newspaper. That jobs section was thin, it had very few jobs posted. In fact, based on a metropolitan area of millions of people, this was stunning to me, that the jobs advertised contained a few hundred listings!

Most of the longest sections were in health care, nursing, truck drivers and "commission" type of sales positions.

Industrial jobs, executive jobs and the like were conspicuous by their absence.

I remember that this was one of the biggest sections in the paper.

I did not feel stimulated.

Then as a curiosity, based on all the sad news about the decline in readership of newspapers, I paid special attention to all news sections of the paper.

It became obvious to me why the papers were failing (this one is in bankruptcy itself too).

The first page had basically a headline story and continued on some further page, and the other story on the front page was of dubious interest.

Then as I turned the pages of the first section, the news stories were very light, and over-shadowed by gigantic ads which took up most of the pages, of each succeeding page. Some of the pages had a single skinny column of a news story overshadowed by a mattress ad,another a cell phone ad, and so on.

I was finished reading the first section in a matter of about 2 minutes!

The other sections were not news, other than a short BUSINESS SECTION that seemed to rehash old news of the week that I already read in internet news headlines.

So I asked myself why would I want to pay that much for the paper from which I literally got no news? was i PAYING FOR THE PRIVILEGE OF SEEING ADS?

It seems that way...so forget about newspapers in the future...just not worth the $1.75 to get the "news" and lots of ads.

Please don't let us hear that the government will lend money to the newspapers!

CAN THE US TREASURY DEFAULT ON ITS DEBT?-YOU BET IT CAN, BUT THAT WILL CAUSE A GREAT RISE IN INFLATION AND DUMPING OF THE DOLLAR



The headlines are scary. Standard and Poor's warns that UK gilts (British Treasury bonds) may lose their AAA rating and indicates that U.S. government bonds may also be downgraded. Bill Gross, PIMCO's "bond king," says emphatically that the U.S. will eventually lose its AAA rating.

What does all this mean? Is it possible for the U.S. government to default on its own debt?

Technically, the answer is "no." The government can always print the money to pay its obligations. But from an economic standpoint, the answer is "yes," since printing money causes inflation and pays off bondholders with depreciated dollars.

The Debt Mechanism

All U.S. treasury debt is denominated in dollars, and except for the less than 10 percent that are "inflation-protected bonds," all bonds are promises to pay a specified number of dollars on given dates. Dollars are created when our central bank, the Federal Reserve, either buys securities in the open market or lends to banks against their loans and other assets. Although Congress imposes a ceiling on the debt issued by the federal government, the Federal Reserve has no effective constraints on the amount of money it can create.

It was not always this way this way. Before 1933, the Federal Reserve could only print dollars in proportion to how much gold the government held -- the so-called gold standard. During the Great Depression, one country after another, including the U.S., left the gold standard and moved to a fiat money standard. Under this monetary arrangement, the government decrees by law (fiat) that its money (Federal Reserve notes in the U.S.) is legal tender for all transactions. There is no gold, silver, or other commodity backing the money.

In a fiat money standard, money only retains its worth because the government limits its supply. The government can limit its supply if it has other sources of revenue, such as taxes or borrowings, to cover its expenditures. But if those other sources dry up, the government may effectively borrow from the Fed, and this would result in large increases in money and rapid inflation.

There is much debate among conservatives about whether the government's decision to leave the gold standard was correct. I, like the majority of economists, believe that it was a good move. If we were still on a gold standard, it would not have been possible for the Federal Reserve to back up money market funds and other bank deposits last September when the credit crisis hit. The resulting run on banks and flight to liquidity would have likely sparked a far worse financial crisis than we experienced. But the flexibility of a fiat money standard must be weighted against its bias towards inflation.

Default Under a Fiat Standard

Although under a fiat money standard government money must be accepted as a means of payment, there is no law that says what that money is worth when it is paid. If too many dollars are issued relative to demand, inflation must result. In that case the bondholder gets shortchanged not because of a government default on its bonds but because of the loss of purchasing power of the dollars paid. (Some countries impose price controls in a futile attempt to assure their own currency won't depreciate in value. Except for limited periods during wartime, such controls have always failed.)

There is one type of Treasury bond that could theoretically default, and that is Treasury-Inflation Protected Securities, or TIPS. Since TIPS compensate bondholders for inflation by increasing the coupon payments and final principal payment by the cumulative rise in prices, the bondholder suffers no decline in purchasing power during inflation. In contrast to standard nominal bonds, TIPS cannot be inflated away, and this leaves open the theoretical possibility that the government could not marshal enough resources to pay interest and principal on these bonds. TIPs for the U.S. government are similar to issuing foreign currency bonds. Any attempt to pay them off by increasing the money supply will cause inflation, depreciate the dollar, and increase the government's dollar indebtedness.

Of course, just because the government can always technically fulfill its debt obligations does not mean that it always will. Since a large proportion of U.S. government bonds are owned by foreign investors, the government could decide that it will only default on those bonds owned by foreigners. The Russian government defaulted on its foreign-owned bonds in 1998, while still honoring domestic bonds. But such selective default would be met by wholesale dumping of dollar assets, sending the dollar crashing on international markets. Given the huge volume of goods the U.S. imports, a plunging dollar means inflation would skyrocket and render such a policy counterproductive.

Our Current Situation

Since the credit crisis began, the Federal Reserve has more than doubled the supply of its own money, and government deficits are running into the trillions of dollars. Many believe this will inevitably lead to rapid inflation.

But such a conclusion is premature. The Fed has increased the supply of money in response to the tremendous increase in the demand for such money caused by the liquidity crisis. And government borrowing is just offsetting the sharp increase in consumer saving caused by the declining value of assets and tighter credit.

I believe that the government's current economic response is right. But the government must be on guard. Once confidence returns, the Fed must pull back the money it loaned and the government must bring deficits under control. This will inevitably mean raising interest rates, and the latest increase in long-term treasury rates is a clear signal that the bond market sees this happening soon. If, by the second half of this year, the economy turns around, the Fed will have to start raising the Fed Funds rate and restrict liquidity. Otherwise the government will effectively default on its obligations -- not by missing its payments but by making those payments in a depreciating currency.

Jeremy Siegel, Ph.D.

HOW TO DESTROY THE BEST EMPLOYER IN AMERICA-A LESSON IN WHAT NOT TO DO MR. PRESIDENT-LEARN FROM OUR TRADING PARTNERS: LOWER THE TAXES!!!



Does the threat of higher taxes for BIG employers who also have overseas operations help or hurt American workers? Keep in mind that many of the FORTUNE 500 now generate bigger profits from overseas operations than they do from US operations. This means that profits from those overseas operations keep US employees working!

Microsoft Corp. Chief Executive Officer Steven Ballmer said the world’s largest software company would move some employees offshore if Congress enacts President Barack Obama’s plans to impose higher taxes on U.S. companies’ foreign profits.

“It makes U.S. jobs more expensive,” Ballmer said in an interview. “We’re better off taking lots of people and moving them out of the U.S. as opposed to keeping them inside the U.S.”

Obama on May 4 proposed outlawing or restricting about $190 billion in tax breaks for offshore companies over the next decade. Such business groups as the National Foreign Trade Council, the U.S. Chamber of Commerce and the Business Roundtable have denounced the proposed overhaul.

U.S. tax rules let companies defer paying corporate rates as high as 35 percent on most types of foreign profits as long as that money remains invested overseas. Obama says he wants to end such incentives to keep foreign profits tax-deferred so that companies would invest them in the U.S.

Microsoft reported an overall effective tax rate of 26 percent for 2008 in its last annual report. “Our effective tax rates are less than the statutory tax rate due to foreign earnings taxed at lower rates,” the report said.

Barry Bosworth, an economist in Washington at the Brookings Institution research center, said many software companies such as Microsoft have exploited tax and trade rules in the U.S. and other countries to achieve a low overall tax rate.

Ireland Subsidiary

Typically, he said, a company like Microsoft develops a product like Windows in the United States and deducts those costs against U.S. income. It then transfers the technology to a subsidiary in Ireland, where corporate tax rates are lower, without charging licensing fees. The company then assigns its foreign sales to the Irish subsidiary so it doesn’t have to claim the income in the United States.

“What Microsoft wants to do is deduct the cost at a high tax rate and report the profits at a low tax rate,” Bosworth said. “Relative to where they are now, the administration’s proposals are less favorable, so there will be some rebalancing on their part.”

Ballmer is one of 10 U.S. software company executives pushing back against the tax proposals in meetings today with White House officials including Jason Furman, deputy director of the National Economic Council, and the heads of congressional committees such as House Ways and Means Committee Chairman Charles Rangel, a New York Democrat.

Expense Deductions

Among other things, Obama proposed limiting expense deductions such as those for employee compensation when companies defer U.S. tax on foreign profits.

In a roundtable discussion today, Ballmer, Symantec Corp. Chairman John Thompson and the heads of smaller companies such as privately held Bentley Systems, an Exton, Pennsylvania-based maker of engineering software, said such policies would hurt domestic investment, reduce shareholder value and increase the cost of employing U.S. workers.

Ballmer said that, while the Obama proposals would preserve expense deductions related to research and experimentation costs, the overall deduction limits for companies that defer tax on foreign profits would raise the cost of employing U.S. workers. Fiduciary responsibility to shareholders would require Microsoft to cut costs, he said, meaning many jobs would be moved out of the country.

Worldwide Employees

Microsoft employed 95,029 people worldwide as of April 21, of whom 56,552 were based in the United States, according to the company’s Web site. The company announced it was firing up to 5,000 people in January while hiring some new workers; the company has shed about 1,000 jobs since then, spokesman Lou Gellos said.

Ballmer estimated that higher taxes under the proposal would reduce profits for companies that comprise the Dow Jones Industrial Average by between 10 and 15 percentage points.

“It’s just a question of how much will the Dow come down,” Ballmer said. “It’s not about companies anyway; we’re talking about shareholders.”

In addition to limiting current deductions for companies that defer U.S. tax on their foreign profits, Obama proposed altering a set of rules known as “check the box” that allow companies to shelter foreign profits in offshore subsidiaries that can be disregarded for U.S. tax purposes.

Duck Liabilities

While the rules were designed in 1997 to protect U.S. companies from paying excessive tax to other governments, Obama administration officials say it has evolved into a way to duck U.S. liabilities. Altering the rule, which Obama dubbed a “loophole,” would generate $86.5 billion in new revenue by 2019, the administration says.

The third international tax proposal would change rules governing how companies can claim tax credits for levies paid to foreign governments. Officials say some companies abuse the rule to accelerate tax credits before they could otherwise be claimed.

Obama has said his proposals would protect or create jobs in the United States.

Thompson of Symantec, the Cupertino, California-based maker of Norton anti-virus software and similar tools, said software companies are frustrated by being called tax cheats and compared with companies that moved their headquarters to low-tax countries such as Bermuda.

‘Counterintuitive’

Thompson called the Obama proposals “counterintuitive” to the administration’s other stated goals of fostering an innovation-oriented economy.

“It is a little bit ironic that most of our most significant trading partners and partners globally have taken the tack that they’ll reduce corporate tax rates to stimulate economic growth and not raise corporate tax rates,” Thompson said.

The roundtable was organized for Bloomberg News by the Business Software Alliance, a Washington trade group coordinating the executives’ meetings with policymakers.

Sometimes it pays to think though the consequences of any bald action or statement like "we want to close loopholes", since it may be those loopholes that help the USA and its employment.
 
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