Perry Glasser

Archive for the ‘Economics’ Category

THE GOOD NEWS

In Business, Economics, Economy, Political Economy, ROBERT REICH, SOCIAL MEDIA, TAXES on January 6, 2018 at 1:10 pm

SOCIAL MEDIA STARS -TWOFER

Dollar$ like to imagine the column is the counterpoint to the tsunami of illogic and disinformation that rises in the far off muddled oceans and then inundates us all. Good news rarely makes it into major media. Social media is more iffy, but the War for Clicks devolves into imagery of Fluffy the Cat or Adolph Hitler because as long as there is no middle ground, panic, disgust, and self-pity rules the day.

Good News

  • Though legions of the self-righteous were quick to announce they had to leave the country because of The Orange One’s election, they are still here. Yes, that is good news. This is America, and in America when an election result does not confirm your convictions you are obliged to learn something and, if so inclined, try again. (Go Joe!  Joe Biden that is.)
  • Urban murder rates in the US are the lowest they have been since 1990. That’s hard to notice on the Left where shrill accusations of American racism serve as a touchpoint for activism no matter how distant the cry lies from Truth.
  • The stock market is at an all-time high. Again, the Left wants you to believe that lives are being crushed by corporate America when, in fact, more than half of all American workers have 401-k accounts whose returns have been staggering in the past 2 years. Will there be a correction?  Of course. So what? Stay the course; grow rich sloooooowly.
  • Unemployment rates are so low that wages are rising. If employers want hands, eyes, or brains, they have to bid for them. Cynics question the motives of organizations that have perceived the 2018 tax cut as an occasion to raise minimum wage and to give low-level workers raises.   No one, however, has yet demanded that workers scorn the new money in their wallets. Dollar$ suggests the true cause is a worldwide growing economy.
  • Your take-home pay starting in February will be higher. If you are on salary, You get to keep more or what you earn. Robert Reich* and other progressives who lack a program beyond, “I’m against it!”  are at pains to remind us that this is really a profound plot to transfer wealth from your pocket to the pockets of the rich. Dollar$, however, suggests you buy a better Pinot. Should the tax law need to be adjusted, it will be. After all, if tax law were shaped in brittle concrete, how did it get changed this year?

* Professor Reich continues to redefine chutzpah by not only telling citizens his work is vital to the program-free Resistance, but by asking us to pay to see that vital message on Netflix. This is akin to expecting members of the maquis before they were strangled with piano wire to have passed a hat to continue their vital anti-Nazi work and expecting the SS to look on benignly before beginning any torture.
All right, maybe they’d pass a beret.

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BITCOIN IN WONDERLAND

In Business, Economics, EDUCATION, Finance, Personal Finance, Political Economy, Wall Street, Wall Street Journal on December 22, 2017 at 2:52 pm

“Curiouser and curiouser!’ cried Alice (she was so much surprised, that for the moment she quite forgot how to speak good English); ‘now I’m opening out like the largest telescope that ever was!”

Bitcoin Speculator

Bitcoin Speculator

Whenever Dollar$ believes the Bitcoin mania is safely dead, someone nibbles a few crumbs of Bitcoin Cake and we hauled back to Looking Glass Land where mad creatures believe strongly that “Jam yesterday, and jam tomorrow, but never jam today,” is an economic promise and not an explanation the White Queen offers Alice.

The Queen said. ‘The rule is, jam to-morrow and jam yesterday – but never jam to-day.’
‘It MUST come sometimes to “jam to-day,”‘ Alice objected.
‘No, it can’t,’ said the Queen. ‘It’s jam every OTHER day: to-day isn’t any OTHER day, you know.’

Beware of strange substances that are labeled Eat Me.

A Silicon Valley startup called Xapo is the White Queen of BitcoinLand.

If you think gains like these are sustainable or represent some sort of value, you must have been eating Alice’s cakes. Maybe you’ve got some of that jam from yesterday. You might also wish to contact Dollar$ who just happens to have shares in the Brooklyn Bridge he can be persuaded to sell to you, a once in a lifetime opportunity.

BTC-2010-lin

 

Xapo is headquartered in Hong Kong, safely away from pesky US regulatory agencies. Sure, they’ve got offices in California, but so does every other financial firm in the world. The Board of Directors boasts former bankers from Argentina and Brazil, not exactly world beaters for stable currencies.

Magic Beans

The bitcoin business proposition is like the story Jack and the Beanstalk. (When it comes to bitcoins, metaphors from fantasy and fairytales are unavoidable.) Give us your real cow, and we will give you magic beans! Overnight they will grow to the sky! When you get up there, you’ll probably encounter a voracious giant ! To survive the giant, you’ll need to be a thief and run like Hell! All you need is the heart of a thief!

The Xapo Proposition

Xapo claims to have constructed physical vaults, “the company says are in mountainous regions.” There are no physical coins, of course. What will be down there will be computers Xapo promises will never be connected to the Internet–you know, like your laptop with no wifi.  If so, that means an army of people doing data entry on a army of disconnected laptops, in mountainous regions that cannot be approached easily. The mountain locations are, naturally, top secret.

If this does not strike you as the premise of a James Bond plot to bring down the world currency markets, what does?

goldeneye_oddjob007_reloade

Bitcoin Security

Liquidity

The bottomless credulity of the cyber-community originates with vitamin deficiencies caused by a steady diet of cold pizza and Red Bull for breakfast, watching Goldfinger too many times, the conviction being that one can get rich without ever getting out of a chair, if armed with an unshakeable libertarian belief that the arms merchants, sex traffickers, and drug dealers MUST have an untraceable non-government issued currency for money laundering.

Bitcoin Banker

Bitcoin Banker

 

TAXE$ AND COMMON CENT$

In Business, Economics, Economy, Finance, Personal Finance, Political Economy, Politics, TAXES on December 21, 2017 at 4:24 pm
bert-lahr-imdb-630x459

SCHOLAR OF THE SUBJUNCTIVE

Dollar$ resents and excoriates finance writers who write in the subjunctive mood. For readers who stopped paying attention to their English teachers in the 8th grade, that means a statement that is conditional. Correctly constructed, the sentiment expresses and a condition that is either not yet true, will never be true, or the speaker wishes were true followed by an outcome that is also not true.

 

If this be treason, make the most of it! – Patrick Henry

In our times, the greatest use of the subjunctive mood is for Romance, handy for lovers unwilling to commit but nevertheless compelled to express what resides in their hearts. Is there a better love song than If I Loved You?

Many speakers flummox the niceties of this important use of mood, and while it is not Dollar$ purpose today to deliver a grammar lesson, he earnestly hopes readers will be afflicted with the dry heaves should they come across ersatz prophets who preserve deniability and protect their alleged expertise by abusing the subjunctive mood. Yes, the stock market may go up, a bold prediction that allows deniability. It may also go down. Dollar$ also notes in passing that Patrick Henry was not speaking archaic English when he addressed the Virginia House of Burgesses, but was properly employing the subjunctive mood of the verb to be. If you still don’t get it, consider that the Cowardly Lion of Oz fame sings “If I were King of the Forest.” Now you know why Bert Lahr never sang was.

THE 2017 TAX BILL

chicken-little-sky-is-falling-1a

SOCIAL MEDIA EXPERT

Dollar$ has until now said zero about the proposed tax bill because it was proposed. Details were open to negotiation. That, however, did not prevent the doyens of social media to claim the sky was falling and suggest that passage of the tax bill would end civilization as we know it.

FACTS IS FACTS

The corporate tax rate has dropped from 35% to 21%. Lest you read Robert Reich, the former Secretary of Labor so startled he is not advising Hillary Clinton in the White House that he has taken to Facebook to lead “The Resistance,” let’s note that despite Professor Reich this tax cut is does not pick the pockets of the poor to give money to the rich. After all, 35% of nothing remains nothing, not coincidentally the amount of taxes paid by Apple Computer and many other multinational American-based companies that have disincentives to bring their profits back to American shores.  The new tax law is a hope to repatriate funds, an overdue program first called for by John F. Kennedy. Short version: US corporate taxes now align with the rest of the industrialized world.

Apple and other corporations can bring billions back to our shores and suffer no financial penalty for doing so. The Tax Policy Center noted in 2014, “Despite its relatively high corporate tax rate, the United States raises slightly less revenue from corporate income taxes as a share of GDP than the average of other countries.”

TRICKLING.4.19.1-figure2_0
Facebook economists who took time from photographing their cats and their breakfast (or cats having breakfast) have been told repeatedly that Trickle-Down Economics does not trickle.  Dollar$, however, notes that several organizations have as of this morning announced raises for line workers and hikes in their minimum wage. Dollar$ is certain those responses are due to more than a rosy picture of future profits precipitated by a tax cut. Fact is, labor is getting scarce; like other valued assets, if you want to keep trained and skilled workers, you have to pay for them. That’s how markets work.

The Koch brothers may have a social agenda, but Facebook economists smugly predicting that the new tax codes will so reduce revenue that Social Security and Medicare will have to be sharply reduced may want to note that neither of those programs is funded out of general revenues but from separate trusts funds. That’s why your annual pay stub has separate boxes for Medicare and Social Security, Binky. They ain’t general revenues. Dollar$ bids good luck to any weasel who lays a hand on those monies, but since the first rule of weasel life is to remain a weasel, Dollar$ is losing no sleep over that possibility.

Similar dire predictions about how the poor will suffer because so many itemized deductions are now disallowed stagger Dollar$ for the hypocrisy or ignorance of how taxes work.

Itemized deductions are

  • also known as loopholes
  • seldom used by citizen taxpayers who do not own a home

LITTLE OLD LADY WHO LIVED IN A SHOE

woman-livedinashoe

TAX PLAN BENEFICIARY

The Little Old Lady who lived in a Shoe had so many children she did not know what to do will, if she itemizes, will get $2,000 per kid where she used to get $1,000. Unless her shoe is worth more than $750,000, her mortgage interest will remain a deduction. Chances are, however, since more than 60% of all taxpayers already use the Standard Deduction, the Little Old Lady will avail herself of that tax simplification because the SD has near doubled. That is, should she choose to itemize, she’d be a damned fool to do so unless he has more than $24,000 in deductions, something highly unlikely for any who works for wages.Look, that redoubtable working family never paid taxes anyway, and at year’s end looked forward to cashing a tax refund check, the sum of all that withholding tax. Under the new tax plan, her refund will indeed be less because week to week and month to month the Fed will be withholding less of her money. Maybe she can build an addition on the shoe, a playroom in the heel, perhaps.

If any of her kids are planning college, despite the dire warnings of Facebook economists, the deductibility of tuition remains untouched.

So do her medical costs above a certain level—the same as the way things are now.

FLIES IN THE OINTMENT

Okay, Dollar$, a few of you still awake might ask what happens by 2028? Don’t these individual tax breaks phase out? That’s when we’ll be screwed, right?

Dollar$ asks the professional pessimists where it is written that a Congress controlled by Democrats in, say 2024, can’t tweak or change tax law? We change appropriations annually (it’s called a budget).

That is to say, Binky, if you think it is in your best interest, vote your convictions, but stop screaming like Chicken Little. Dollar$, you pestiferous fool, this tax law will raise the deficit!! We are going to hell in a handcart!” (Be careful though, you may start to sound like a Republican advocating fiscal responsibility.)

We have for a decade endured GDP growth in the 2% range, and we hunger for greater. Three percent is not unreasonable; up around 4% you can get a nosebleed and bet we are losing ground to inflation. But should the economy grow more quickly than it has, the deficit goes down. Bill Clinton demonstrated that by riding out Ronald Reagan’s tax cuts.

A country near 100% employment can afford a few risks, and if for a few years we put money in the hands of citizens, should we sweat it?

 

 

$$$

ZERO-SUM TAX POLICY

In Business, Economics, Economy, Political Economy, Politics, TAXES on December 12, 2017 at 12:52 pm

Five players sit down to play cards, poker for example. Each brings $100 to the table, and because of a peculiar tradition of the Dollar$ Casino, no player is allowed to introduce additional money into the game. If one player has sufficient skill, after some time that player will have $500 and the other four players will have $0.

That’s a zero-sum game.

In the social realm, that’s another way of saying that no player can be allowed to accrue more wealth without a second player becoming poorer.

This is assuredly NOT how the economy works, nor can it be the basis of Tax Policy. Perhaps for the simple-minded who find their checkbook to be an overwhelming problem in higher math, but let’s hope that political and economic policy are not tailored for the least able among us.

THE ZERO-SUM ECONOMY3032348.large

In reality, players in a card game can bring welcome new money to the table by:

  • dipping into a vault where old money has been snoozing,
  • innovating when some whippersnapper creates new
    • logistics (drone delivery, anyone?),
    • desirable products (cats do love their roomba rides),
    • organizational efficiencies that squeeze every nickel out of every process

On the Left, the “I don’t got it and you do so you must give it up” social justice warriors are out there, demanding that your children have to split up shares of an ever-shrinking pie. On the Right, the tax proposal now undergoing reconciliation between the House and Senate limits Research and Development tax (R&D) credits out of some misguided effort to cast a political illusion of “fairness.”  Fairness in tax policy usually means “the other guy should pay more.”

Dollar$ readers with a lick of sense will see this for what it is—an attempt to disallow new money to be brought into the game. Dollar$ is no champion of trickle-down economics, but hopes we can all acknowledge that faith in the future is not blind faith, but a realistic assessment of economic history. If it were not, Malthus would have been right and we’d all have become cannibals by now.

AN OBJECT LESSON

Twenty years ago, the world was supposed to be out of oil by now. Petroleum cartels (OPEC) were supposed to have sucked up all the money in the world. An entire genre of popular films was developed depicting a desert world where fuel was so scarce that warlords took women, water, and weapons based on how much fuel they could steal. Mad Max was a nightmare born of shortages and the lurid fantasies of adolescent boys.

If tax policy had been based on that scenario, and gasoline taxed to conserve an ever-diminishing resource, the cost of gasoline would today be sky-high instead of the roughly adjusted for inflation stable price of the past 25 years – the sole exception being those years when OPEC states manipulated prices by manipulating supply under the false impression that no innovation could ever occur—which it did.

OPEC’s hold on the world economy was busted by hybrid cars and oil from shale extraction coupled with the discovery of 80% of the world’s accessible shale in the United States. It may not be clean and it may not be pretty, but after the picketing is done, you can be sure some whippersnapper will find a way to make it prettier and cleaner.

THE R&D TAX CREDIT

Let’s keep the whippersnappers in business!

 

 

 

 

Tulips and BitCoins

In Business, Economics, Economy, EDUCATION, Finance on December 7, 2017 at 9:00 pm

Tulips

In 1636, Holland discovered the tulip. They were imported. People went crazy for them. Everybody wanted them. No one could get enough of them, and the more rare they seemed, the more valuable they became. The cost of tulip futures for some bulbs rose to prices worth more than 20 acres of land. I am not making this up.

It’s easy to laugh, but open your closet and count your Beanie Bag Babies stash. How many collectibles have you bought recently? Holy bananas, have you been buying fake money and stamps with baseball players on them from small Caribbean states as family heirlooms?!?

But God forbid, have you considered BitCoins?

The Wizards on Wall Street are fainting. They notice that Bitcoin rose above $15,000 this week, and is up from $800 a year ago.  Remember, always that Wall Street Wizards invest in nothing, but they want a piece of every transaction. They earn profits when money changes hands, and if that is when your kid’s college education turns to dust, well, that’s a shame.

BitCoins are an imaginary currency backed by the full faith and credit of nothing, not nobody, not nohow.  The dollar, on the other hand, is a currency backed by the full faith and credit of the United States, which Dollars$ admits may not be all that much more, but has to be worth more than a few beeps and blips on some kid’s garage in a Tokyo sub-basement. Sorry, Binky, but the gold in Fort Knox has not been seen for decades. Every bill in your American wallet is a promise to pay–later.

The US dollar is also the standard for several other currencies, small countries, mostly, that cannot risk having speculators manipulate their money. In  the currency markets where money floats, the US dollar is relatively stable.  On the other hand, people who invest in Bitcoins either live too far from a decent casino or think Monopoly money is tricky stuff. They plan on being the last person through the exit when the inevitable collapse occurs, but do you know what happens when all the elephants try to get through the door at the same time?

BitCoin is the preferred currency among drug dealers and computer hijackers, those rascals who are the cousins to that Nigerian prince who offer you millions if you’ll send just a few thousand. The Prince makes that offer by email; the BitCoin pirates fly the Jolly Roger  while sailing through cyberspace.

You get your choice.

bitcoin

look that them digits!

jolly roger

WEALTH INEQUALITY

In Business, Economics, Economy, EDUCATION, Finance, Political Economy, Politics, TAXES on December 5, 2017 at 10:40 pm

bossy sisterWhenever my big sister played Monopoly, if the game was going against her she would toss the playing board in the air. My hotels and houses would scatter across the living room carpet as she shouted, “Salugi!” (a New York-ism pronounced “suh-LOO-gee”)and lunged across the table to confiscate most of my deeds, especially Boardwalk and Park Place.

When I was able to read the rules of the game, I learned there was no allowance for tossing the game in the air or confiscating my property. My sister was cheating! But since I was 8 and she was 14, she was able to meet my accusation by beating me up.

The History of Wealth Redistribution

My sister was a revolutionary.

To be sure, Dollar$ reminds readers that rebels object to rules, but revolutionaries rewrite them. Rebellions are common; revolutions are rare.

The folks who threw the board in the air in the past have cried, “Justice!” not “Salugi!” They had names like Washington, Lenin, Mao, and Castro.

Note that political persuasion—Left or Right—has nothing to do with revolutionary status. Mao and Washington might have discussed military tactics, but Dollar$ suggests they would have come to no agreement about economic systems or the function of government.

The Function of Governmentpreamble-20532-20120118-55

It’s less complicated than Monopoly.

We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.

Washington (the dude on the $1) believed that the function of government was primarily to protect the rights of the individual, rights that most often needed protection from government itself. If no military personnel have been billeted in your living room, thank Washington.

Washington may have noted that to promote the general welfare required some redistribution of wealth to insure equal opportunity and to insure domestic tranquility, but that does not guarantee equality of status among citizens.

Washington’s pal was the first Secretary of the Treasury, Hamilton (the dude on the $10). Hamilton understood that wealth concentration in institution like banks were a social good, provided the bank used that concentration of wealth to fund the visions of a greater society, lending money to visionaries and giving stability to the economic infrastructure by protecting wealth from being squandered by a ruling class on personal indulgences. Hamilton, an orphan at 11 and the illegitimate son a British West Indies plantation owner, would likely not endorse a notion that the function of government was to protect the rights of the filthy rich to become obscenely rich.

The Situation Today

Some of Dollar$’s best friends sink into fuzzy thinking when talk comes around to how wealth is created and distributed in the United States. They lose sleep fearful that someone, somehow, somewhere, is leveraging assets to optimize profit.  They simple-mindedly believe that economics is a zero-sum game and cannot imagine economic growth. If an organization makes a dollar, someone must be a dollar poorer.

No. That simply is untrue. If it were so, you and I would enjoy the same standard of living as Washington and Hamilton. But the fact is that economies grow.  At issue is how they grow, not whether they should grow at all, though there are indeed some who think that a good idea, too.

The deluded friends of Dollar$ from time to time propose bold programs to redistribute wealth, programs they understand as pursuing Justice.

There two reasons those cannot and should not work.

1. Nowhere in the US Constitution will one find the word corporation. True, we reserve the right to free assembly, but that does not elevate any assembly of citizens devoted to profit a guaranteed right to speak lies in its advertising or compensate its directors and executive officers so rapaciously that shareholders who hope to partake of the boons of the system see their profit participation reduced by rapacious Buccaneers.

Oliver-Wendell-Jr-Holmes-9342405-1-402
Not Sherlock; not Mycroft, just Oliver

2. Oliver Wendell Holmes, Jr. noted Taxes are the price we pay for a civilized society. The idea is carved in stone on the IRS building in DC., but let’s note that corporations do not pay taxes, they collect them.  If you think they do not, you are submitting to a distraction. Dollar$ hastens to explain that citizens are consumers. Tax us, and we bleed money. Bleeding, we consume or save less, neither of which are good things, though it does not follow consumers should not be taxed. Civilization is messy, but must be purchased. But to a corporation, taxes are a cost of doing business, like labor, supplies, and logistics.

Raise corporate tax rates, and corporations will only raise their prices.

Guess who pays the difference?

Today’s  Lesson

Remember, friends, we cannot pursue social justice by confiscating wealth. We can, however:

  • Limit executive compensation by law to some multiple of the lowest worker in an organization;
  • Create progressive income tax brackets that limit the shift of American wealth to the rich from the poor;
  • Lower repatriation taxes so that companies that keep their money off-shore are encouraged to bring it home where they can invest in more factories and create jobs here–better to collect 15 percent of something than 30 percent of nothing;
  • Demand that higher education is a matter of national security, and so to insure the blessings of liberty are  free to all;
  • To insure the blessings of liberty on ourselves and our posterity, give tax breaks to organizations that train employees instead of demanding that future employees borrow so much money to gain perceived needed skills that students have no choice except a life of indentured servitude;
  • Regulate publicly traded corporations by disallowing aggregation of profits as cash without paying shareholder dividends, a means to share in that profit. Can we stop the nonsense that hoarding cash is good corporate financial strategy when all it does is spike share prices that are subsequently used to calculate executive performance compensation? (Are you listening Apple Computer?)
  • Return to personal income tax rates that  reflect the needs of our society. Under Eisenhower, we built the interstate highway system and taxed marginal income as much as 92 percent.

We don’t have to throw the game board in the air to start over again: all we need to do is play by the rules.

CONSPIRACY THEORY

In Business, Economics, Economy, Finance, Political Economy, Politics, Wall Street on February 12, 2016 at 1:09 pm
Janet Yellen

Wizard-in-Chief

Dollar$, always eager to explain the inexplicable world of Finance, that realm in which Wall Street Wizards and Corporate Buccaneers run rampant in their never-ending struggle to own, pervert, master, and control Political Weasels, has developed a theory.

 

Why should Plain Money Talk  be any different from every other blog?

 FACTS

2015 saw:

  • unemployment drop to new lows,
  • minimum wage adjusted up,
  • auto sales rise to recent highs,
  • home sales rise to recent highs with no speculative bubble,
  • the cost of gasoline and heating oil sink to new lows,
  • the United States become an oil exporter.

The Fed is so concerned at all this good news that Janet Yellen has begun to tighte credit, a tactic employed to throttle growth and forestall inflation. Yes, the Wizard-in-Chief, Janet Yellen, is worried things are too good.

Some apologist is sure to point out that the second largest economy in the world, China, is hurting. Dollar$ will give that point of view some quick attention.

CHINA

China’s weakening economy should mean the cost of living in the US will drop, meaning you and I will have more money in our pockets to pay off debt or buy more stuff, everything from furniture to T-shirts at Wal-Mart. The US – China trade balance is heavily weighted toward China—the US imports far more goods from China than China imports from the US. If those good become less expensive, the American consumer benefits. This does NOT harm American business.  Maintaining profit margins at lower prices is easy to do. The cost of commodities the world over is dropping because of the slowdown in Chinese demand. Commodities are the stuff that comes out of the ground from tin to lumber and to gold, the stuff from which everything else is made. Everything should be getting cheaper. Every time Wizards predict that Apple will stop selling iPhones in Shanghai, Apple sells another few million units, but at a lesser price. With inexpensive gasoline, Citizens will be driving  to Disneyworld this year, and they will be able to afford the Mouse’s uptick in prices.

This phenomenon confounds the Wizards., who have learned that bad predictions are clickbait, and clicks drive revenues. No one watches CNN until the shit hits the fan and the shelter under the table grows crowded and cramped.

In the face of positive economic news, the US stock market should be soaring. Instead, the Dow-Jones average has stepped off a cliff in 2016, shedding 2,000 points in 8 weeks, more than a trillion dollars worth of value has been erased from the books.

THE CONSPIRACY

Cui bono?

For the past 30 years,  at every presidential election, commentators complained of the choice between Tweedledee and Tweedledum. But this year, it ain’t so.

weasel candidates in days of yore.

US Presidential Candidates Since 1964

 

This year, on the one hand, we have a wealthy, self-funded foul-mouthed injudicious narcissist celebrity never elected to anything anywhere who is much favored by people who have felt disenfranchised for a generation. On the other hand, we have a New York Jew now from Vermont who has never accepted a dime from Buccaneers or Wizards. An older man, his followers are youth because he demands payback from the banks and companies who were too big to fail and in the past 20 years have sucked the economy dry, indenturing students with education debt. On the third hand, we have a woman who is indebted to the old politics, and on the fourth hand, we have a clown car of interchangeable Republicans who lacking economic issues promise to disallow what your neighbors do in their bedrooms while coyly ignoring that for those promises to be fulfilled they will have to rollback several Supreme Court decisions by what by any account has been a conservative court.

Dollar$ sees the common threat. The two leading candidates are not in thrall to Wizard or Buccaneers. Should either get elected, the summer house in the Hamptons, the private jet, and the 10-room Manhattan  condo are all in jeopardy.

How to dissuade Citizens from voting for either?

Scare the piss out of them. Scare the piss out of them by manipulating stock prices downward. It’s only temporary, and it’s not as tricky as it sounds.

  • Claim good news is bad.
  • Threaten us with defunded pensions, evaporating college savings, and the elimination of savings toward the American Dream, a house.
  • Imply that unless Citizens vote the status quo and allow rapacious policies to continue, grass will grow on Main Street as economic activity collapses.

The stock markets should be soaring, but never forget that 90 percent of all trading is electronic and that computer algorithms engage in a global battle to take advantage of a quarter point’s worth of arbitrage. There is no longer any such thing as investor sentiment. As they now say in Wizard country, My algorithm can beat up your algorithm!

Fear is the most potent means of keeping the harridans out of the White House. Without the creation of synthetic Terror, Weasel Business As Usual will come to a halt.

O the horror!

 

PARANOIA STRIKE DEEP

In Business, Economics, Economy, EDUCATION, Finance, Political Economy, Politics, Wall Street on January 27, 2016 at 5:20 pm

WIZARD OF FINANCE

Suppose the financial community is conspiring to collapse the stock market.  I mean, just suppose.

Heavens to Murgatroyd! Why would they do that???

Glad you asked.

Since the only reason financial Wizards do anything is for more profit, Dollar$ in a fever of dread will outline the conspiracy scenario for you.

Dollar$ notes that Republicans Weasels, who represent monied interests, have no issue on which to run for the America presidency. They can manufacture some issues, but the American economy have just enjoyed:

  • plummeting energy costs
  • record automobile sales
  • the lowest unemployment in a decade
  • a rising minimum wage
  • rising home sales
  • a strong dollar
  • and the completion of a tax year that allowed investors to book profits with a Dow-Jones Industrial Average at an all time high.

Now that the record-breaking year is over, it is time to hammer stocks and terrify Citizens. Citizens  who believe the economy and the stock market are the same thing are sadly vulnerable. If the Wizards and Buccaneers can delude enough Citizens into believing the United States is in trouble, they might not vote for a Democrat!!!

screwed1

Citizen

There is no rational reason to think the US economy is troubled. Nor is there something called “market sentiment,” that outmoded fiction contradicted by the fact that 90 percent of all market volume is done by computers at the speed of light. Market perturbations are in fact a contest among algorithms.

Nor is the charade fooling the Fed—which refused to raise interest rates again today. Grass will not be growing in the streets of every American village any time soon. There is not coming financial collapse.

We are not even in the midst of a contraction.

What we’ve got is a bunch of rapacious bastards willing to endure paper losses for a half year in hopes of assuring future revenues and the continuation of the financial environment that enriches very few by squeezing the rest of us.

Call me paranoid.

GREEK DEBT and ANTI-SEMITISM

In Economics, EDUCATION, Finance, Political Economy, Politics on August 2, 2015 at 10:45 am

It is a fundamental understanding of Dollar$ that the only purpose a weasel has is to continue life as a weasel.

Greek Weasel

Greek Weasel

As predicted by Dollar$ a week ago it took 3 days after the Greek people vehemently rejected European demands for austerity for the Weasel-in-Chief Greek prime minister, Alexis Tsipras, to reverse what he told Greek citizens, the same folks who elected him thinking they had one thing but who, in fact, had another.

Running out of co-conspirators at which to point his finger, Tsipras, fired a few Lieutenant Weasels and went back to the grim business of promising austerity in order to joyfully continue spending other people’s money on a lifestyle that include pensions at 60 and tax evasion as a national sport.

Reality sucks.

MEANWHILE BACK IN THE STATES

The rending of garments has nevertheless continued apace for American progressives, a crowd that when facts do not fit the narrative invent new facts.  Vowing solidarity for “poor Greece,” the victim-state, is a progressive necessity required by Left-ish mythology, that state socialism has to work but does not because of a conspiracy of bankers and capitalists who first give you money you requested and then—O Horror!—expect it to be paid back. Equally miserable is the sad fact that people whose chief knowledge of Economics is having defaulted on a car loan and mismanaging credit card debt think that international finance and their own incompetence are one and the same thing.

The goddam nerve of some those money-lenders!

First, they wait for you to ask for money; then they structure a deal that is so smart and so devious, that all the national bankers and economists of Greece were fooled.

WE’VE HEARD THIS BEFORE

Dollar$ writes to inform the naive that the legs on that canard are rooted in anti-Semitism. The cunning that condemned Shylock now condemns Goldman-Sachs, those Jewish New Yorkers who when they are not undermining the world economy to line their own pockets are championing godless communism. When you read the phrase international bankers on the Internet, make no mistake: the writer means world Jewry.

Dollar$ has always been puzzled by the alleged partnership between Jewish communists and Jewish bankers. The fact that the goals of such groups are antithetical does not stop the fascist minded American Left. Why not? It never stopped it before.

When you bear in mind that Hitler founded a party of National Socialists, and it will all remain clear.

My Debt, Your Debt, Greek Debt

In Economics, Political Economy, Politics, Wall Street on July 17, 2015 at 6:40 pm

Wearily, Dollar$ emerges from semi-retirement with the vague idea of dispelling some of the more blatantly moronic opinions surrounding the current Greek debt crisis.

There are all manner of weasels infesting the world, not those cute critters, but the kind who live for re-election. As a refresher, Dollar$ asks readers to remind themselves on the sole priority that exists in democratic weaseldom–say anything, no matter how vague or false because relinquishing power is too horrible to think of.

Fat Eddie on the left.

Fat Eddie on the left.

This may be why it takes all of 48 hours for Alexis Tsipras, Greek’s Weasel-in-Chief, to reverse himself on what to do about Greek debt. You let citizens vote, you rouse the rabble, and then you renegotiate with the European Wizards on Wizard terms and screw your citizens.

GRIM TRUTHS
Economics is called the grim science for a reason.

One of the more grim truths of Economics is that when you get a loan, you gotta pay the money back.  Dollar$ learned this lesson from his old buddy, Fat Eddie, who spent many of his days on a park bench in the sun lending money at interest to longshoreman on the Brooklyn docks. Occasionally, for free, he’d share wisdom with callow youth.

I had a hot horse at Aqueduct. I wanted $100. The animal was going to go off at 20-1.

“I can pay you back tonight.”

“No kid. I like you. I appreciate your enthusiasm, and I even agree the horse looks good. But have you considered how you will get me my money and 5 points interest if the horse loses?”

“The horse is a lock.”

“What if he comes up lame? The jockey falls off? Or the horse has a heart attack?  Steps in a gopher hole? It’s a horse, for crissakes.”

“You can have my bicycle as security.”

“What am I gonna do with a freaking bicycle? Get outta here. Do something wholesome. Play blackjack in the park. Roll dice in an alley. Roll a drunk in an alley. Something wholesome. Are the poolrooms closed? Just get outta here.”

So as he slapped the back of my head, I learned my lesson from from Fat Eddie. No one wants to do business with a dead-beat.

It is bad for business.

DEBT
There are two kinds of debt, consumer and capital. Idiots crying for Greece and its screwed population do not know the difference, possibly because they are long-term debtors who have never experienced anything other than being a consumer.

  • Consumer Debt is money borrowed to purchase goods that will be consumed.  Nothing amazing there, right? You consume, bread, gasoline, shoes, and sealing wax. Once it is consumed, it is gone. If you do not have a source of income, you will eventually find paying back consumer debt impossible. Credit card companies will call you at odd hours. Your bills will be handed over to collectors. The road to a happy life requires that you NEVER assume consumer debt you cannot pay back by the end of a month. Credit cards issued by banks charge rates that make would Fat Eddie blush. The only exception is if you are temporarily embarrassed and the kid needs eyeglasses or new shoes. The key is the word temporarily. If your situation is not temporary, you really need either public assistance or a new job. We live in America. If you have to go bankrupt because you cannot pay back, the court will protect you from shylocks and collection agencies. You get a fresh start. No one is happy, and you will not be able to borrow dime #1 for several year, but you can get out of a jam. We no longer populate debtor’s prisons.
  • Capital Debt is money borrowed to make more money. You might hear it called “leverage.” If you are a going concern–a business or have a decent job–CAPITAL DEBT IS A GOOD THING! Why not pay 4 percent on the expectation you will make 8%? Sure, there is risk, but it is the kind of risk even Fat Eddie can respect. Your house mortgage is an asset  that will likely increase in value, Your car enables you to work beyond walking distance from where you live. Your education is a definite asset that will pay off many times what it costs to borrow–provided you do not borrow $150,000 to become a basket-weaver. A bank may be persuaded to loan you  the capital you need to start a business if the bank thinks the business can generate enough profit to sustain you, your employees, and still pay off the interest. If the bank thinks all this is true, the bank will throw money at you.

GREECE

Since 2001, Greece has borrowed money for capital investment, a step required for admission to the European Union and all the expected blessings of a single European currency.

Alas–Greek weasels confused Capital and Consumer debt. Instead of making its citizens more productive, a stratagem that would allow the debt to be paid off, duly elected weasels enforced a low retirement age. Since collecting taxes is nowhere popular, Greek weasel leadership looked the other way as tax evasion became a way of life for the people of Greece. The repeated bailouts were a vain hope by Europe that Greece would understand it was not a teenager with Daddy’s credit card, but a going concern responsible to its citizens and the international community.

Like Fat Eddie, the lenders want their money back. What is German going to do with a frigging bicycle? There are no assets waiting to be confiscated. This is a sovereign nation, for crissakes. No one is showing up to repo the Parthenon.

The knuckleheads who blame the banks for having seduced Greece into loans it cannot pay want to remember Fat Eddie. No one wants to lend money to a deadbeat. It’s bad for business.

What Greece needs is a weasel overhaul, not debt forgiveness.