One Hundred Thirty Four: When We Went Over The Cliff

Grover Norquist is right:  the "fiscal cliff" is just a totally arbitrary date.  I actually think we went over the cliff (if you want to call it that) in a two step process.  The first step was when the Supremes upheld Obamacare.  That greased the runway for the second step, which was the reelection of BO.  After these two steps we are guaranteed to have government growth on a scale not seen since the creation of Medicare.  What all of this means is simply that more of workers output will be consumed by government, and government will be responsible for providing more services to individuals, which government does quite badly.  But this is what people seem to want.  They will continue to want it until it hurts so much that they demand something different.

One Hundred Thirty Three: Why Democrats Are Dumb

I start this entry with the assumption that the vast majority of voters regardless of party affiliation would like to have more stuff.  Very generally speaking, Republicans wants less interference from government so they can use the fruits of their labor to get more stuff.  Democrats want more government, which they believe will take stuff from Republicans and distribute it to people who don't want to work as much as Republicans (in other words, Democrats).  The fact that rank and file Democratic voters believe this is manifest evidence of their ignorance.  Stuff taken from Republicans only goes to further grow government, which rather than distribute the stuff, actually consumes the stuff.  What is left for Democrats who don't work for the government is close to zero.

One Hundred Thirty Two: BO Reelction

Yesterday I had breakfast with two friends.  Both have every reason to want to see an end to any further BO governance, yet both hold deep resentment of Romney, apparently because he is wealthy.  They have both bought into mainstream Democratic propaganda that Romney did not earn his wealth, and therefore is somehow not qualified to lead the country.  On of these friends, has even decided that a Romney presidency would be somehow immoral, because it would be unfriendly to gays, women and racial minorities.  My friends are completely willing to accept the most blatant Democratic falsehoods, but apparently incapable to even listen to Republican ideas, and give them a fair hearing.

BO is here for two terms, and by the time he's finished, the growth of government and the shrinking of the private sector will have ruined much personal freedom.

One Hundred Thirty One: Bernanke QE

I can think of no reason for the actions of Bernanke other than something like high-class bribery.  As the economy makes one more gasp at trying to undo the excesses of borrowing and spending of the years leading up to 2008, by naturally and inevitably growing at sub-normal rates, BB is rumored to be on the verge of yet another round of QE to spur consumer spending.  Any rational adult who has ever balanced a check book and a household budget (this excludes Obama by the way) knows that this is lunacy.  The chickens must come home to roost eventually.  Debts must be paid by someone.  If not the debtor, then the creditor must write off receivables.  Either way, income from the present must be used for past spending.  This requires retraction, retrenchment, recession.  People must live in smaller houses, or rent their homes instead of owning.  BB says he wants some inflation.  But higher prices are anathema to those experiencing a lower standard of living.  Why does Bernanke keep pursuing this course?  Perhaps he has been offered something of value in exchange for making policy decisions which will help someone get reelected.

One Hundred Thirty: Bank Fools

Any bank customer, whether retail or commercial, with banking needs under $100 million who uses a money center bank (Chase, B of A, Wells Fargo, Citi, etc.) is a fool.  The prior parenthetical also includes the so-called "super regional" banking groups like PNC or BB&T.  The fact of the matter is that large banks are simply not equipped to handle small customers.  The front line and entry level personnel at large banks have about the same knowledge level of banking as the typical MacDonald's employee.

I deal with banks everyday on matters ranging from a few thousand dollars to a few million.  And your average community bank is perfectly capable of handling these needs.  Also, I am able to find persons in these small banks who will be semi-accountable for the services they are trying to provide.  I am not saying that the small banks always do a good job - quite the contrary; they screw up all the time.  It's just that with a smaller outfit you can usually find a guy who will eventually do the right thing because of the potential for embarrassment in the local community.

The area where big banks are the absolute worst is mortgage lending.  Every time I have a client who goes to Chase or B of A for a mortgage I tell them it's a mistake.  When the clients don't listen, they are inevitably hosed by Chase (or whoever) and regret their decision.

Big Banks only want retail customers so that they can charge fees for certain services (overdrafts, credit cards, wire transfers, etc.).  Small banks still manage (or try) to find value in the relationship.

One Hundred Twenty Nine: Health Care

Last night I listened to some of the oral argument at SCOTUS while drifting off to sleep. From the questions posed by several of the justices it seems as though the chances of reversing any or all of the current law are slim. Especially given the two woman (Sotomayor and Kagan) picked by BO to serve on the Court, the chances of overturning ANY law passed by a Democrat congress are almost nonexistent. So, to me the focus should not be on undoing what BO has done, but rather on how to fix it. If we are to have national health care, which is not philosophically a bad thing, what is the best and most efficient way to implement and administer it? If all the members of congress got sick and went to the Mayo Clinic in Rochester, MN, I guarantee that there would be quick agreement on a plan to simply hire the people at Mayo to run the national system and be done with it.

As far as the economics are concerned: I currently pay about $13K per employee in health insurance (this covers the employee and their families). I assume my rates are about the same for most small businesses; large corporation pay far less because of economies of scale. But we use VERY simply economic assumptions, say the government taxed every individual taxpayer an average of $3K per year for health insurance. With approximately 100 million taxpayers, that would be about $300 billion per year generated to pay our collective health care costs. If that is not enough, tax a little more. The point is, there would seem to be enough wealth generated by our current economic activity to accomplish the objective.

One Hundred Twenty Eight: Apple

So, here I sit at the Apple Store in Deer Park, Illinois. The store probably has 75 people milling around. Approximately 30 of them are blue-shirted A drones. One A drone in particular, a 50-ish woman trying desperately to look something less, hovers over me like humming bird. My friend is buying, or has purchased an iMac and is being led through the set up process by an overweight A drone who seems to be one of the less obnoxious employees. Actually, they are all quite impressive in terms of superficial product knowledge. Interpersonal skills are generally non-existent though. I guess Apple, and the tech biz in general, has long since decided that basic personal social skills are not important. And I suppose when you are interacting with someone electronically, the other person really doesn't care what I sound, look or smell like. It's a different world out there from the one I grew up in, which is of course the lament of every generation. But I wonder if this shift from real to virtual contact between humans really is a game changer.