Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Tag Archives: Spending

Is Now the Time to Buy Walmart Stock?

This article was published by The McAlvany Intelligence Advisor on Friday, October 16, 2015:  

English: Exterior of a Wal-Mart Supercenter in...

Exterior of a Wal-Mart Supercenter in Madison Heights, Virginia.

Walmart (WMT) hit 90 in early January, and hasn’t come close since. On Tuesday this week it traded at 67, just before the company’s announcement that shook the markets. Following that announcement the stock traded at 60, down 10 percent on the day and 30 percent from January.

Pundits leaped on the news, claiming that

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Federal Deficit at Eight-year Low; Don’t Celebrate Yet

This article appeared online at TheNewAmerican.com on Friday, October 16, 2015:  

On Thursday the Treasury Department announced that the federal deficit for the 2015 fiscal year, which ended September 30, fell to an eight-year low — $439 billion — thanks to tax revenues that grew at a rate faster than government spending. Revenues, according to the department, grew by eight percent over last year while government spending grew by five percent.

Treasury Secretary Jacob Lew celebrated:

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Walmart’s Stock’s Selloff Hinges on Perceived Economic Gloom

This article appeared online at TheNewAmerican.com on Thursday, October 15, 2015:  

English: Inside the Walmart (still branded as ...

Inside the Walmart at West Plains, Missouri.

Within minutes of Walmart’s announcement  on Wednesday that the world’s largest retailer would see its profits drop between six and 12 percent next year, the company’s stock started a decline that only ended after it had lost 10 percent of its value, its worst single-day performance in 37 years.

Despite a previous warning from Walmart in August that its quarterly profits, year-over-year, would likely fall by 15 percent, and despite the company’s stock continuing its decline from $90 a share in January to $67 before the announcement, investors were caught off guard. Now trading below $60 a share, investors have seen the value of their Walmart holdings drop

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Does California Have a Death Wish?

This article was published by The McAlvany Intelligence Advisor on Thursday, October 8, 2015: 

Cato Institute

A year ago, when the Cato Institute published its Fiscal Policy Report Card on America’s Governors, the best governor, Pat McCrory of North Carolina, scored 78, giving him an “A” rating by Cato. The country’s worst governor, Jerry Brown of California, scored 19, earning him an “F.” His rating was seven full points behind Colorado’s Governor John Hickenlooper, who scored a 26. At the time, Cato said this about Governor Brown:

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Freedom to Choose Includes the Freedom to Move

This article was published by The McAlvany Intelligence Advisor on Friday, September 11, 2015: 

Free to Choose

Milton and Rose Friedman published their work Free to Choose – A Personal Statement 35 years ago when it became a best seller, topping best seller lists for five weeks. Ten years later PBS created a telecast with Dr. Friedman interviewing, and often debating, experts from across the political spectrum, including Walter Williams on the right and Frances Fox Piven on the left.

In the video chapter “The Power of the Market” Friedman makes the point that the free market’s greatest benefit is the power of options: where to live, where to work, whom to marry, how to worship, and on and on.

Walter Wriston, considered by many to be the single most influential commercial banker of his time, serving as chief executive of Citibank from 1967 to 1984, condensed Friedman’s chapter into one pithy quote that reverberates today:

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Public Pension Plans Cut Rate of Return Targets; Still Not Enough

This article appeared online at TheNewAmerican.com on Monday, September 7, 2015:  

Twenty million pension plan beneficiaries have just been warned: You won’t be getting what you have been promised when you retire. Part of the reason is that pension managers have been far too optimistic in estimating what they are able to earn on your money. And part of the reason is that they continue to remain so.

In its analysis of 126 public pension plans, the National Association of State Retirement Administrators (NASRA) noted that more than two-thirds of them have reduced their estimates, however slightly, since 2008, while 39 of them are still stuck

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Social Security Disability: Reaching the End of the road?

This article was published by The McAlvany Intelligence Advisor on Friday, July 24, 2015:  

Social Security Poster: old man

Buried in the annual exclamations of urgency by the trustees of the Social Security system issued on Wednesday was this warning: action by Congress will “give the public adequate time to prepare.” In the short run, some 11 million on Social Security Disability will learn that their benefit checks will drop by $200 a month starting next fall, so they need to get used to that. In the long run everyone receiving anything from the celebrated Ponzi scheme will see their checks go to zero:

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Greek Vote the Death Knell for the EU?

This article was published by The McAlvany Intelligence Advisor on Wednesday, July 8, 2015:  

English: Nigel Farage at Lord's cricket ground...

Nigel Farage

Nigel Farage, named “Briton of the Year” in 2014 by the London Times, has finally found his voice. He noisily departed the Conservative Party in 1992 after the signing of the treaty that created the European Union to start his own UK Independence Party (UKIP). His criticism of the EU has been steady ever since, culminating in his eulogy on Monday: “The European Union is Dying Before our Eyes.”

According to Farage, Sunday’s referendum in Greece sealed its death warrant, even if somehow the Greek PM Alexis Tsipras is able to come to terms with the troika and have them turn on the financial spigot once again: “It [was] a crushing defeat for those Eurocrats who believe that you can simply bulldoze public opinion.” He added,

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Greece-EU Standoff Increases Chances of “Grexit”

This article appeared online at TheNewAmerican.com on Tuesday, July 7, 2015:  

UK Independence Party

Writing in London’s Telegraph on Monday, Nigel Farage, the leader of the anti-EU, pro-sovereignty UK Independence Party (UKIP), called Sunday’s referendum in Greece “a crushing defeat for those Eurocrats who believe that you can simply bulldoze public opinion.” Threats by those Eurocrats to shut off emergency financing unless the country agreed to its terms fell on deaf ears, especially among those under age 35: Eighty percent of them voted no on Sunday.

That cohort is the one least likely to remember the songs that were sung by those promoting the European Union decades ago:

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Greeks Shout “NO!”

This article was published by The McAlvany Intelligence Advisor on Monday, July 6, 2015:  

Greek citizens shouted “No!” to further austerity measures for the hapless country in exchange for more of what got it into trouble in the first place: other people’s money. The lopsided 60-40 vote astonished telephone pollsters, who predicted a much narrower victory for Greek Prime Minister Alexis Tsipras of the far-left Syriza party. Although the issues were far more complicated than the referendum made it appear, the 68-word ballot question made it easy: do you want more increases in taxes, more cuts in pension benefits, another increase in the VAT … or not?  Translated into English, the ballot read:

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OECD Issues Pessimistic Forecast for France

This article appeared online at TheNewAmerican.com on Wednesday, June 24, 2015: 

The OECD — the Organization for Economic Cooperation and Development — put the best face possible on France’s declining economy in its just-released forecast. The report was full of optimism about the future but admitted that the present reality is discouraging. Note the use of words “projected” and “should” in its opening paragraph:

Economic growth is projected to gain momentum in 2015 and 2016. Lower energy prices, improving financial conditions, slowing fiscal consolidation, strengthening external demand and a pro-competitive reform agenda should underpin an increase in consumption and export volumes.

But the reality is far different, said the OECD: 

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U.S. Financial Outlook has “Worsened Dramatically”

This article first appeared online at TheNewAmerican.com on Wednesday, June 17, 2015: 

English:

This graph is outdated but revealing

 

In its just-released report “The 2015 Long-Term Budget Outlook,” the Congressional Budget Office stated bluntly:

The long-term outlook for the federal budget has worsened dramatically over the past several years, in the wake of the 2007-2009 recession and slow recovery…. If current law remained generally unchanged in the future … growing budget deficits … would push [the national] debt above its current high level.

It’s all about government spending that’s baked into the cake:

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Proposed Federal Tuition-free Community College Likely to Be a Bust

This article first appeared online at TheNewAmerican.com on Monday, June 8, 2015: 

Buried in the fine print of President Obama’s State of the Union speech last January was an idea that the federal government should make community college tuition-free. It’s loosely based on a Tennessee program that seems to be working without federal funding or intervention.

The federal program would add $6 billion to the government’s already bloated educational assistance programs, which already run $70 billion (not counting the $100+ billion in student loans) every year. Anything for the kids, it seems, and according to promoters, the taxpayers won’t feel a thing.

According to the federal program, an estimated nine million students attending community colleges could avoid up to $3,800 a year in tuition, with three-quarters of the largesse coming from Uncle Sam and the balance put up, under federal mandates, by the states. In his speech, Obama called community colleges “essential pathways to the middle class,” adding,

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U.S. Economy Goes Negative in the First Quarter

This article first appeared online at TheNewAmerican.com on Friday, May 29, 2015: 

The Commerce Department reported on Friday that the U.S. economy shrank at an annual rate of 0.7 percent, a sharp downward revision from its previous tepid estimate that it would grow by 0.2 percent.

It caught most mainstream economists off guard once again, with many predicting positive growth right up until Friday, and more remaining doggedly optimistic that growth will return. Economists polled by the Wall Street Journal just 10 days ago were holding to a 3-percent growth rate in the economy for 2015, while analysts polled by the AP just prior to the release on Friday were still predicting growth of between 2 and 2.5 percent for the year.

Paul Ashworth, chief U.S. economist at Capital Economics, is waiting for evidence that growth will return in the second quarter:

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Mainstream Economists, the Herd Instinct, and GDP

This article first appeared at The McAlvany Intelligence Advisor on Wednesday, May 20, 2015:

It’s no surprise, really. Most mainstream economists look at the world through Keynesian lenses, they attend the same conferences, read the same reports, are employed by companies in the same industry, hold degrees from the same universities, and are rewarded for having a view that doesn’t stray from the norm, even if that view is wrong. It’s a perfect reflection of the herd mentality: the impulse or tendency toward “clustering,” reflecting the need for conformity. It’s how economists make weathermen look good.

If their view turns out to be wrong, they adjust, slowly. If they are challenged or threatened,

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Atlanta Fed Drops GDP Growth Estimate to Under One Percent

This article first appeared online at TheNewAmerican.com on Tuesday, May 19, 2015: 

Whenever new data on the economy is reported, the Atlanta branch of the Federal Reserve System (the Atlanta “Fed”) releases its proprietary “nowcast” on how well the economy is doing. For some time now, that forecast has embarrassed mainstream economists who have subsequently been forced to drop their own forecasts as the economy continues to slow.

In February GDPNow projected that the U.S. economy would grow by 1.9 percent in 2015, far below the rosy estimates by mainstream economists. Two weeks ago GDPNow projected growth at 1.2 percent. On May 13, it dropped further,

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Chicagoans had to Choose Between Venal and Feckless for Mayor

This article first appeared at The McAlvany Intelligence Advisor on Wednesday, April 8, 2015: 

In Tuesday’s mayoral runoff in Chicago, voters had only two choices: to vote for the venal Rahm Emanuel or the feckless Chuy Garcia. Four years ago Emanuel rode Barack Obama’s coattails to victory, winning in a walk with 55 percent of the vote. In February, Emanuel couldn’t squeeze out a majority, getting only 46 percent of the vote and forcing a runoff with a far-left progressive on the Cook County Board of Commissioners, Jesus “Chuy” Garcia.

With the help of an estimated 100 “friends of Rahm,” Emanuel buried Garcia, raising some $30 million for his campaign, eight times what Garcia was able to raise. On Monday Emanuel held an 18-point lead over Garcia.

Garcia was hoping for a miracle.

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Moody’s Downgrades Chicago Again

This article first appeared online at TheNewAmerican.com on Tuesday, March 3, 2015:

English: in Chicago, Illinois, USA.

Downtown Chicago, Illinois

Within hours of Moody’s Investors Service announcing another downgrade to Chicago’s general obligation bonds last Friday, Mayor Rahm Emanuel’s administration responded, saying that Moody’s was out of touch with reality:

We strongly disagree with Moody’s decision to reduce the city’s credit rating and would note that Moody’s has been consistently and substantially out of step with the other rating agencies [Standard & Poor’s and Fitch Ratings], ignoring progress that has been achieved.

At the moment those other two agencies rate Chicago’s debt at A-plus or A-minus, each with a negative outlook. But in light of an imminent court ruling that could invalidate efforts to cut pension benefits, along with the crushing and increasing burden of those benefits, observers are just waiting for the next two shoes to drop.

As Moody’s noted, its downgrade will stand even if the court validates those pension modifications: 

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Tax Foundation Counts All Income Except Underground

This article first appeared online at TheNewAmerican.com on Monday, February 23, 2015:

Tax Foundation

Tax Foundation

Not one single word of the 10-page report “Sources of Personal Income” released by the Tax Foundation mentioned the “black market” — that vast swirling uncounted (and largely uncountable) part of the U.S. economy that some estimate in the trillions. Accordingly, that throws off the foundation’s attempt to draw any more than tentative conclusions about how much the average taxpayer earns.

According to the Foundation, Americans reported a total of $9.2 trillion in income in 2012, the latest year for which numbers are available, with $6.3 trillion of it coming from “wages, salaries, tips” and “other” compensation. They get those numbers mostly from the infamous

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U.S. Government’s Interest Costs to Quadruple in 10 Years

This article first appeared online at TheNewAmerican.com on Thursday, February 5, 2015: 

On Tuesday, the Wall Street Journal reported that the federal government will be paying $800 billion annually just to service the interest on its massive debt by 2025, up from just over $200 billion currently. By 2021, those interest costs will equal what the government is projected to be spending on national defense, and on non-defense (so-called “discretionary” items), and will greatly exceed those two budget items just by 2025. The Journal also noted that “non-discretionary” items (so-called “mandatory” expenditures) will continue their inexorable march upward, from $2 trillion currently to more than $4 trillion by 2025.

Surprisingly, few eyebrows were raised over the announcement,

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Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.