Saturday, January 30, 2010

Improving Employment Trends


Republicans blame Obama for job losses, but they fail to put the figures into context. The month President Obama came to office the country lost 750,000 jobs. This was just the continuation of a long trend of rising job losses that were the natural result of the atrocious Bush economic policies.

With the passage of the stimulus, the nearly $300 billion in tax cuts, and the steady hand of the Obama Administration, there has been a remarkable shift in the jobs figures. Again, with GDP rising at a brisk clip, I fully expect to see job creation figures start to rise.

Just as I have been predicting for months, the economic programs of the Obama Administration are working and with unemployment being a lagging indicator, it will be the last to improve, but improvement is happening.

Changing Economic Fortunes


Yesterday the GDP figure showed strong growth in Q4 of 2009. The economic turnaround in this country has been nothing short of amazing. Republicans blame Obama for everything that goes wrong, but then when the economy improves they just say it is part of some normal economic cycle. That is utter B.S.

The stimulus package worked exactly as it was meant to. The Obama Administration's efforts to keep mortgage rates low through Fed action and borrowing have helped and the cash for clunkers program all contributed to turning around a growing economic disaster.

As the chart shows, when President Obama came into office GDP was crashing and in Q1 of 2009 it was shrinking by an annualized 6.4 percent. It is now growing and if we get sustained growth in 2010 we will start to see the unemployment rate start to come down. In addition, tax revenues will naturally increase - even with no change in tax rates - and this will start to shrink the enormous deficit that Obama inherited.

Friday, January 29, 2010

GDP Growth Explodes!

Truly remarkable number for GDP growth was reported today - 5.7% in Q4. That is a 10 percent change from a year ago. In Q4 2009 we were in the midst of a historic cratering of the economy with GDP sinking at -5.4% and it further contracted in Q1 at -6.4%.

That is what Obama took office with. The tax cuts and stimulus money that he passed in late February have worked as they were intended to and have turned around the economy.

We are now poised for growth through 2010 and we should start to see the employment numbers improve.

Republicans will do what they always do - stick their head in the sand and try to convince others to do the same. But the reality is that President Obama's steady hand and bold policies are paying off. Instead of running from President Obama's agenda and falling for the B.S. the Republicans are trying to shovel out, the Dems need to embrace his leadership. If they do the country will be far better off. But Obama has to do his part - he has to get out and let the public know every day what is going on and the realities of his policies. Use the bully pulpit of the presidency Mr. Obama and we will all gain.

Thursday, January 28, 2010

State of the Union

I thought President Obama gave a good speech last night. My feeling is that he needs to be more vocal and out in public more often. He should do more press conferences all in an effort to engage and inform the American public.

By staying silent he has seen his approval numbers drop and Republicans have created a narrative that the American people are starting to believe.

President Bush nationalized Fannie Mae, Freddie Mac, GM, Chrysler, and AIG. It was President Bush that created the TARP and provided the bank bailouts. He left behind an economy in shambles with GDP shrinking by almost 6 percent and unemployment rising. In January 2009 when Obama took office, the U.S. lost 750,000 jobs that month. As a result of the Bush tax cuts, the reckless spending on two wars, and the Medicare Part D program that he implemented without paying for, Obama walked into a $1.2 trillion budget deficit for FY 2009.

The $787 billion stimulus package that Obama championed included $287 billion in tax cuts that help 95 percent of Americans this year. Now we have seen a remarkable turnaround in the economy. We see GDP growing slightly and job losses seem to have stopped over the last two months. We should see improvement this year. The consensus view by economists is that the stimulus package saved about 2 million jobs. The U.S. is recovering and we will see unemployment shrink over the course of the year.

Those are veriable facts, but the Republicans want to take the country back to the policies that caused our problems. President Obama has to remind Americans every day of the facts and make his case. Hopefully he will do that in coming weeks and months.

Wednesday, January 27, 2010

Tim Tebow's Anti-Abortion Ad

There is a minor kerfuffle brewing about a Super Bowl ad that Tim Tebow is in that talks about abortion (it is a pro-life ad). Whatever your position on the ad, there is a broader point that people need to understand about Freedom of Speech.

There are pro-choice women's groups that are protesting Tebow's ad and CBS's decision to air it. I don't have any idea if CBS is going to pull the ad, but there are right wing nuts out there saying that that would be an attack on Tebow's right to free speech.

The First Amendment to the Constitution states the following:

"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances."

Tebow's Constitutional rights are not being threatened. He is free to say what he wants and pro-choice groups are free to say what they want. If CBS - a private enterprise - chooses to show or not show the ad, there is no attack on free speech.

If Congress or the federal government stepped in and demanded that CBS pull the ad they would infringe on Tebow's Constitutional right to free speech. If the government quashed pro-choice groups from protesting they would be infringing on their Constitutional rights. Neither of these things are happening.

We have too many people who do not understand basic civics and social studies.

State of the Union

President Obama is going to give his first State of the Union address tonight. What I am hoping is that he uses it to go on the offensive in promoting his agenda. After starting strong and passing the stimulus bill - which absolutely helped improve the economy and save jobs - he has stopped pushing for his agenda and allowed Congress to "lead."

What we have been left with is squabbling Congressional factions - Republicans, Conservative Dems, and Liberal Dems - that do what they always do: NOTHING.

The President needs to explain to the American people on a regular basis what is happening. If I were advising President Obama, I would schedule talks every day or every other day around the country and I would have the President speak to the American people twice a month to give updates on what is happening and what needs to be done.

Health care needs to be reformed. The current system is failing and will only get worse because of the structural and economic issues that are in place. The system is becoming more and more expensive and we are getting worse care. There are tangential issues that are arising, like the fact that there are many would-be entrepreneurs that won't start businesses because they are afraid of losing their health coverage. This further hurts the economy and national competitiveness.

The deficit and national debt are problems, but again, most of the costs are a result of non-discretionary spending like Medicare. Without addressing health care, it doesn't matter what you do the national debt will rise. President Obama needs to get on the offensive and explain this to people.

Monday, January 25, 2010

McCain Opposes Bernanke Re-Appointment

Let me first say that McCain is a total economic idiot. That is a general statement that is independent of what I think about his position on giving Bernanke a second term as Fed Chair.

Now, I am simply amazed by the reactionary idiots who now oppose Bernanke. If not for Ben Bernanke's cool hand and bold moves we would not be talking about a financial meltdown, but rather a full blown global Depression. Bernanke is a national hero.

The financial meltdown was a result of a number of factors but greed on Wall Street and the failure to effectively regulate the financial sectors allowed the careless and reckless speculation to nearly bring down the world economy.

The reason government does not work is because we don't get the best and the brightest to lead the nation. Instead, we are stuck with folks like McCain who do not demonstrate the ability to understand significant issues facing the nation, and others who make up a chattering political class that has no issue pitting groups of Americans against one another in an effort to get elected.

Saturday, January 23, 2010

Republicans

Let me start by saying that the Dems in the Senate have been pathetic and again the President has not used the power of the presidency to push the agenda that he was elected to put forth.

That said, I am just amazed by how uninformed the average Republican is and how ridiculous their positions have become. The Republican economic philosophies over the last 8 years have been an incredible disaster for this country. The debt accumulation without anything to show for it has left us in a dire situation. But now, the very same Republicans who caused the trouble are blaming President Obama.

The reality is that President Obama is dealing with a major mess. This is the first year that President obama's economic blueprint and philosophies will be in full effect. The 2009 fiscal year ended at the end of September and the overwhelming amount of spending and debt accumulation for the last fiscal year were still due to Bush. If things do not improve this year then you can start to blame Obama.

But, I cannot for the life of me understand what Republicans want. They put forth the TARP and bank bailouts and then they complain about them. The American people are outraged by the excessive bonuses and huge profits that many of the large banks are reaping as a result of the no/low interest loans they got from the American people. So when Obama proposes bank taxes to repay the TARP/bailouts, Republicans complain. OK, what do they want? They wanted to give the big banks taxpayer money without any strings so they can pay out huge bonuses? WTF?

Friday, January 22, 2010

Worst Supreme Court Ruling EVER!

Yesterday the Supreme Court ruled 5-4 that corporations are equivalent to people and that there can be no restrictions on their political donations because it is protected free speech.

This was a disasterous decision that will haunt this country for years. It is an assault on freedom and democracy. If you think that money in politics is bad now, it is just about to get a whole lot worse. Corporations can now spend unlimited amounts to buy politicians and influence elections. We are going to see the floodgates open and corporations truly rule this country - they do now for the most part, but now they don't even have to pretend that they don't. They don't have to find ways to funnel money to third parties to skirt campaign finance rules. Now they can just do it in the open.

Imagine how much money the oil and gas companies are now going to spend to kill alternative energy technology and climate legislation. Worker protections and corporate taxes are going to be eliminated. Regulatory protections for the American people will erode over the next 10-20 years. There won't be Republicans and Democrats, only Corporatists who will pretend to be for the American people but who are really only out for a buck will truly rule.

I hope I am wrong, but in 10 years we will look back on this decision and recognize how much it destroyed in America.

Tuesday, January 19, 2010

Obama's First Year

President Obama has failed to lead - pure and simple.

On a personal basis, he seems like a likeable fellow. He is smart and appears to think through his options. The problem I have is that he has not demonstrated a resolve for the things he talked about on the campaign trail. He was swept into office with a clear mandate for ending the war and health care. Those were his two major tasks and he has not accomplished either.

The horrible economy that he inherited is turning around, but the Republican narrative that Obama is to blame is working because there is no alternative discussion coming from the White House.

He needs to toughen up and use the bully pulpit of the presidency to explain to the American people what is happening. He has allowed the Republicans to pin the economy on him. He has allowed the Republicans and a small group of conservative Dems to derail health care. He has escalated the war in Afghanistan and not ended the war in Iraq. As a result of these factors his support from his base is waning and Independents are not sure who to support. Being a middle of the road guy is nice if you are running for a local school board, but a President needs to show that he can lead. Obama just isn't doing it.

UVA Basketball

Tony Bennett has done an amazing job turning around UVA's basketball program. The Cavs struggled with UNC-Wilmington last night but won to go 12-4. It was a bit of a surprise that UNC-Wilmington ended up being such a challenge, but it was a classic "trap" game. The Cavs had just come off a blowout win against ranked Miami and were feeling good about being 3-0 in the ACC.

In any event, this team plays solid defense gets good production from a lot of guys and then has a true go-to guy in sophomore Sylvan Landesberg. They won 10 games all of last year and look like they may end up a tournament team.

I love it.

Monday, January 11, 2010

Zorn to Chicago

Jason Reid posted something today that Zorn is on the radar screen in Chicago. I wouldn't mind seeing Zorn as the OC and QB coach in Chicago. I think he is great with QBs and without all of the distractions he could probably devise some great game plans.

Growing Fear of China Bubble

I have been reading more and more stories about the coming collapse of China. There are concerns about a rapidly inflating housing bubble, the lack of transparancy in the government's economic figures, and the amount of speculative money that is flowing into the country.

A collapse in China would more than likely create a major world economic crisis - probably a global depression. I am not convinced that the problem is that large yet, but I must say that the evidence is becoming more and more believable.

Hold on to gold - it is the only hedge I see right now.

Thursday, January 07, 2010

How's This for a Trade

Jay Cutler for the #1 pick this year, the #1 pick next year, and a conditional pick (#2 to #5 based on performance) next year.

The Bears could sign Jason Campbell and use the picks to pick up some young talent. They could also go back to more of a traditional Bears offense that focuses on ball control and not making mistakes.

Shanny would get the QB he wants and Cutler will be happy playing for him.

Pep Hamilton to UVA?

Reports are that he is interviewing for the Cavs OC position.

I have mixed feelings about this. He seems like a good guy and has had mixed success. Things couldn't really be any worse on offense for the Cavs. But, I think he was a horrible QB coach in Chicago.

Wednesday, January 06, 2010

Bears Coaching Changes

I'd like to see Mike Martz brought in as OC. He is a good offensive mind and I am sure he is loyal to Lovie. But the Bears are apparently also talking to Charlie Weis and USC's OC, Jeremy Bates. I'm not a Weis fan and am not sure he would get along well with Cutler or Lovie. The thing about Bates is that he is a young guy who was Cutler's QB coach in Denver. I wouldn't mind seeing him get a shot.

On the defensive side of the ball, there was a rumor that Rod Marinelli was going to become the DC - that would be a mistake. We need to move to someone outside the organization. Perry Newell is a name that has come up. Newell was the DC in Buffalo and was the interim HC. I don't know much about him, but his defensive game plans have been pretty good especially given the injuries the Bills have had on the defensive side for the last two years. He worked with Lovie with the Rams and runs a modified Tampa 2 type D - so he seems to be a fit and is probably the top candidate.

The Trib also has Herm Edwards and Mike Zimmer in the mix. I would like to see Zimmer in because he would bring an all new defensive philosophy to the Bears. The Tampa 2 has been weak the last three years - it seems to me that we need real change.

Monday, January 04, 2010

Financial Thoughts

It certainly looks like the disasterous economy that we were left with at the end of the Bush Administration is now moving back on track. The stimulus bill was important. I have never been a fan of the TARP and think it did very little for the banking sector - but at least some of the money is being paid back.

With the economy growing and the heavy debt burden that we have to service through foreign cash, we can bet that interest rates will be rising over the next year. This will also help keep inflation under control. As a general statement, I think inflation is something to pay attention to, but I don't see it as a major threat over the next year. The global economy remains soft and the dollar is still considered the best currency. The Fed has done a pretty good job over the last year with the economy and I don't have any concern that inflation will explode in the next year.

Gold and oil prices will rise slightly, but they don't seem to have much more room for growth. They will increase because the dollar will remain about where it is and the economy will start to improve. There will still be fears of inflation that should keep upward pressure on gold and oil, but since I don't see inflation as that big an issue prices should be largely the same at the end of the year.

Finally, I think we will see 5 percent GDP growth at the end of this year. Inventory levels are low and the economy is picking up steam so I think we will see significant recovery and improvement in terms of GDP. We'll see the stock markets see good years this year as inflation remains tame and GDP grows. With this growth, we will start to see unemployment fall. I would not be surprised if we see unemployment fall to about 8 percent by the end of the year with further improvement expected next year.

Obama/Dems

This past year has been a great disappointment by a President who I was totally thrilled with when he was elected and came to office one year ago. Let me start by saying that I still am convinced that McCain/Palin would have been a disaster and am happy Obama/Biden won. The problem I have with President Obama is that he has largely been a caretaker President. That is, he hasn't really stepped out and led, he has largely kept things at the status quo.

We remain in Iraq, have escalated the war effort in Afghanistan. We don't have any momentum for a single-payer insurance system. There has been no change in No Child Left Behind. There has been no financial regulatory reform. We really haven't seen any major change in policy from the Bush Administration.

I do believe that the stimulus package - which was a major piece of legislation - has been great but much of the money still has not filtered down to fund projects. The $200 billion in tax breaks has been helpful for middle class folks, but without the money actually hitting the economy the stimulus effect has been minimized.

I would like to see Candidate Obama return and lead, rather than the current version of President Obama.

Chicago Bears Season Comes to a Close

Bears win against the lowly Lions. No surprise there. Cutler closed out with two very good games (8 TDs and 1 Int). He has promise - we'll see what happens next year. I still think the trade will end up being much better for the Bears in the long run. It is also interesting to note how far Orton fell from the beginning of the year, and how Denver collapsed.

I still like Lovie, but it is clear the Bears need a new scheme on D and better play calling on offense. That said, I would like to see a coaching change but if Lovie is back then there needs to be some significant changes on the staff.

I cannot wait until next season.