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: Wall Street

Time Warner Continues to Shrink, Selling Off Most of its Magazines

With the announcement that Time Warner (TW) is selling most of its print magazines to little-known mid-west publisher Meredith Corporation, the media giant continues its great shrinking act which dates back to 2001. At the time of the AOL-Time Warner merger in January, 2000, the combined market capitalization of the company was $350 billion. Today its book value is

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Kentucky Senator Rand Paul Introduces National Right-to-Work Act

On January 31st Senator Rand Paul (R-Ky.) introduced his National Right-to-Work Act, S.204, subtitled “A bill to preserve and protect the free choice of individual employees to form, join, or assist labor organizations, or to refrain from such activities.” His timing couldn’t be any better.

One year ago Indiana joined the growing list of right to work (RTW) states, followed in December by

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Happy days coming for conservatives?

I think George Will may be just a tad optimistic, but he does have a point: Obama will implode. It remains to be seen if the so-called “conservatives” will be able to take advantage of the implosion. Says Will:

Happy days are not here again, but

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Another Progressive myth exploded

In general Progressives like to extract data that supports further government intervention. One such myth (or trope) is that “the middle class is stagnating, and something must be done!” As two of my favorite economists, Mark Perry and Donald Boudreaux, wrote in the Wall Street Journal,

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If you were in the 60% tax bracket, would you move?

Phil Mickelson is considering it. Last year Mickelson had a pretty good year: $3.7 million in earnings and – get ready – $57 million in endorsements, for a total income (mostly taxable) of $60.8 million.  With the one-two punch of Obama and Brown (California’s hapless governor), Mickelson has done the math:

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Diamandis: Coming Technological Advances are Staggering

English: Peter Diamandis in ZERO-G

Peter Diamandis in ZERO-G (Photo credit: Wikipedia)

Just reading about Peter Diamandis makes me laugh out loud. Let me quote this about him from Wikipedia:

Peter H. Diamandis (pronounced /dʌmændɪs/) (born May 20, 1961) is an American engineer, physician and entrepreneur best known for being the founder and chairman of the X PRIZE Foundation, the co-founder and chairman of Singularity University and the co-author of the New York Times bestseller Abundance: The Future Is Better Than You Think.

He is also the former CEO and co-founder of the Zero-Gravity Corporation, the co-founder and vice chairman of Space Adventures Ltd., the founder and chairman of the Rocket Racing League, the co-founder of the International Space University, the co-founder of Planetary Resources, and founder of Students for the Exploration and Development of Space.

Diamandis is a mature adult male who hasn’t grown up. He continues to enjoy life to the fullest, and thinks our future is so full of promise that it’s all he can do to contain himself. The Wall Street Journal‘s article says that, according to Diamandis, “the world has never been in better shape and that it is going to get even better.”

Diamandis spoke at the first annual meeting of the CIO Journal (sponsored by the Wall Street Journal), for information officers, and told the 60 CIOs attending that “we’re literally at the

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Is the Fed running out of bullets?

MarketWatch is run by competent commentators with a slight conservative cast to their writings. It’s part of the Wall Street Journal’s online offerings. With that in mind, I take an exception to two points of view expressed yesterday in its article about the Fed “running out of bullets.”

First, the article says that the Fed is going to

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America Headed for Energy Independence! Unless…

English: Oil Rig, Cromarty, Scotland

Oil Rig (Photo credit: Wikipedia)

Just six years ago the US imported 60% of its oil. Today it’s down to 40%, and continuing to decline, according to the Wall Street Journal. It’s really quite amazing what incentive, technology and freedom are able to accomplish.

U.S. crude imports fell 9.2% in October from a year earlier to 8.091 million barrels a day, the lowest amount of imported crude since January 2000, according to U.S. Department of Energy data released today .The data are the latest illustration of how the drilling boom in North Dakota and other states is remaking the U.S. energy picture.

Remaking, indeed. It’s a total restructuring of the world’s economy. In the past the US has been increasingly dependent upon the Middle East and other producers to keep the lights on. And this has had enormous

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Fiscal Cliff Funny Numbers: Taxpayers Pay More Yet Deficits Rise

Uncle Sam is Broke

Uncle Sam is Broke (Photo credit: Infrogmation)

Now that the House of Representatives has virtually rubber-stamped the Senate bill to avoid going over the fiscal cliff – the so-called American Taxpayer Relief Act of 2012 (ATRA) – which President Obama is expected to sign shortly, commentators have been working feverishly to determine exactly what is in the 157-page bill that no one had time to read before being rushed to completion at the very last minute.

The analysis by the Congressional Budget Office (CBO) measured the impact of ATRA against its baseline assumption that the congress would do nothing and let all the pieces and parts of the fiscal cliff occur automatically. In that baseline, annual government deficits would have been cut in half, from $1.1 trillion to about $640 trillion. But under the new law, the national debt will increase by

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The economy isn’t like a pizza, Mr. O.

P. J. O’Rourke has a way with words. The author of 17 books including the one he’s perhaps most famous for, “Don’t Vote! – It Just Encourages the Bastards“, he has enough backbone to

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More confirmation about the new recession

In a strange way this article from Marketwatch is confirming, but also unsettling. I’ve been writing about the recession call by ECRI for months now and now along comes John Hussman saying the same thing to his clients:

Money manager John Hussman, chairman of Hussman Funds, is among those who think it is. “We continue to believe that the U.S. economy joined a global economic downturn during the third quarter of the year,” he wrote to investors recently.

He notes that

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Newsweek’s last Print Issue is December 31st

The Wall Street Journal noted the end of an era with the final print edition of Newsweek magazine coming out on Monday, December 31st. It will transition to an online-only format with plans to charge subscribers for its content after the first of the year.

The end has been coming for some time. On October 18th, Tina Brown, Newsweek’s editor, announced the change on the same day that she

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House Speaker Boehner Offers Plan B with Tax Increases

On Tuesday, December 18th, Republican House Speaker John Boehner spelled out some of the details on his “Plan B” offer to the White House in case Plan A goes nowhere. It appears that Plan B will go nowhere as well, but not because of resistance from the White House, but from other House Republicans who are intent on keeping their word.

According to Boehner’s office, Plan B “Does not raise taxes. It is a net tax cut that prevents a $4.6 trillion tax hike on January 1.”

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Why not arm the teachers?

On Saturday morning I wrote about my immediate reactions to the Connecticut school shooting and asked rhetorically who was to blame. Among others I blamed the teachers. Why wasn’t anyone armed? Did they not conceive of such a threat to their charges?

I didn’t realize it at the time (having not read anything but the headlines) but

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Will Paywalls Save the Mainstream Media?

New York Times' ipad app

New York Times’ ipad app (Photo credit: Hidden Peanuts)

I’ve become increasingly annoyed at my inability to access (directly) an article in the Wall Street Journal or the New York Times because they put up a “paywall” between me and the article: they want me to buy a subscription in order to get it.

Now don’t think for one minute that I don’t think their writers ought to get paid. I’m a writer. I like getting paid. But the world of the internet is changing how information is delivered, and the print media is dying. And, at present at least, I can gain indirect access to the article elsewhere on the internet, or I can go elsewhere for the information I’m seeking.

Felix Simon is a writer for Reuters and he made a bet with a friend at the Financial Times that the New York Times wouldn’t get 300,000 subscribers to get past their newly established paywall. Simon may lose his bet, but the revenues behind the numbers tell the real story:

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Establishment Economist fears the Cliff, unless…

Alan Blinder wrote an open letter to Congress at the Wall Street Journal (summarized here if you don’t have a subscription) which proves that smart people can often say dumb things and get paid for it.

First, he’s worried about Republican intransigence that threatens a “deal.” You know that I think a “deal” has already been struck and just the details need to be ironed out. But let’s listen in on what Blinder has to say, to pick up some nuggets about how a Princeton economist with bags full of establishment credentials thinks about the fiscal cliff.:

Congress should work out a deal now to avoid the fiscal cliff, even if it means kicking tough decisions down the road, or it risks tipping the economy into a recession and sending unemployment rates to 11 percent.

That’s the establishment meme:  catastrophe awaits unless something is done! He says that $600 billion will be siphoned out of the economy which “would contract the country’s still-weak gross domestic product and wipe out what little improvements that have taken place in the labor market so far.”

Actually, no. That $600 billion number has been bandied about for so long that it’s taken as fact. The impact of the fiscal cliff is around $600 billion, but some of it is spending cuts. Precious little, unfortunately, around $120 billion or so, but any spending cut, to me, is a good thing. The impact of the Bush tax cuts ending will take about $300 billion (best estimate) out of the economy beyond what Washington is already “siphoning ” off. At present, the government’s revenues from taxes are approximately $200 billion a month. That number would increase, everything else remaining constant, to about $225 billion a month. That’s pretty big, but when compared to an economy that generates about $15 trillion in goods and services every year, it’s almost a rounding error.

But Blinder sticks with his $600 billion number and says that the sky is falling:

If you take between 3 percent and 4 percent of total spending out of an economy, a recession is very likely to follow…

Millions of jobs will be destroyed, incomes and wealth will fall, and businesses will fail in droves — all because a bunch of politicians couldn’t agree.

He also believes the establishment unemployment rate of 8 percent, and then says the fiscal cliff will raise unemployment by 3 percent. That brings him to 11 percent unemployment if nothing is done. Blinder probably doesn’t know that Shadowstats.com even exists, which has consistently shown the real unemployment rate to be above 15 percent.

But Blinder has a plan: raise taxes, raise the debt ceiling, and kick the can:

Compromise should involve raising the debt ceiling now before it approaches anew and agreeing on broad budgetary outlines that avoid the cliff — kicking the can down the road is okay to a degree, provided specifics and filling in the blanks do, in fact, come later…

What’s new here? It’s foolishness all wrapped up inside the establishment envelope of the Journal so it looks believable to the uninformed.

Ron Paul Decries Bipartisan Efforts to Avoid Fiscal Cliff, Predicts Compromise

Texas Republican Representative Ron Paul has, based on his decades of experience watching Washington negotiate and dither, predicted an 11th-hour compromise that will increase government spending and put off hard decisions into the future.

On his website Paul noted:

America faces yet another Congressionally-manufactured crisis which will likely end in yet another 11th hour compromise, resulting in more government growth…

He’s seen it all before:

The hysteria surrounding the January 1 deadline for the Budget Control Act’s spending cuts and expiration of the Bush tax cuts seems all too familiar. Even the language is predictably hysterical: if government reduces planned spending increases by even a tiny amount, the economy will go over a “fiscal cliff.”

This is nonsense.

But it’s being treated as serious business indeed by the power brokers in the House of Representatives and the White House. On December 3rd, House Speaker John Boehner (R-Ohio) sent a letter to the President outlining the Republicans’ plan to avoid the fiscal cliff while criticizing the president’s plan offered last week as containing “very little” that was constructive in reaching a compromise. Regrettably, said Boehner,

That proposal calls for $1.6 trillion in new tax revenues [over ten years], twice the amount you supported during the campaign. [Your] proposal also includes four times as much tax revenue as spending cuts, in stark contrast to the “balanced approach” on which you campaigned…

What’s worse, the modest spending cuts in [your] offer are cancelled out by the additional “stimulus” measures [you] are requesting.

Boehner then countered with his plan to avoid the fiscal cliff, including some changes to Medicare and Medicaid which he says would save $800 billion a year, “hundreds of billions in savings in other mandatory spending”, including reforms to Federal employee compensation and the Supplemental Nutrition Assistance Program (SNAP) – formerly known as the food stamp program.

In addition, he offered “new revenues” which would come, not from higher taxes on the wealthy as demanded by the president, but would instead come from revising the tax code and closing “special interest-loopholes and deductions” while lowering tax rates.

Boehner acknowledged that his plan was just a counter-offer:

This is by no means an adequate long-term solution, as resolving our long-term fiscal crisis will require fundamental entitlement reform [but it is a] fair middle ground that allows us to avert the fiscal cliff without hurting our economy and destroying jobs.

In other words, the Bush tax cuts would stay, Medicare and Medicaid programs would be modified slightly and some loopholes would be closed which would allow the Congressional Budget Office (CBO) to score the Republican plan higher because of its alleged benefit to the economy.

The White House response was nearly immediate. Said White House Communications Director Dan Pfeiffer

 The Republican letter [received] today does not meet the test of balance. Their plan includes nothing new and provides no details on which deductions they would eliminate, which loopholes they will close, or which Medicare savings they would achieve.

He added:

While the president is willing to compromise to get a significant balanced deal and believes that compromise is readily available to Congress, he is not willing to compromise on the principles of fairness and balance that include asking the wealthiest to pay higher rates…

Until the Republicans in Congress are willing to get serious about asking the wealthiest to pay slightly higher tax rates, we won’t be able to achieve a significant balanced approach to reduce our deficit [that] our nation needs.

What this maneuvering has exposed, however, is the first break in the Republicans’ commitment to hold against any increased taxes. The president, still enjoying the euphoria over his reelection and feeling that he can stand firm against a weaker Republican majority in the House, continues to employ the Hegelian Dialectic of letting the Republicans come to his table to negotiate instead of the other way around.

This is a popular tactic which was used by Erskine Bowles, a member of the  deficit-reduction super-committee created in 2010 when he offered a compromise that was “the midpoint of the public offers put forward during the negotiations to demonstrate where I thought a deal could be reached at that time.”

The Wall Street Journal sees the compromise taking shape: a two-step plan whereby a small deficit-reduction package is signed into law – a “down payment” – by the end of the year, and letting the new congress deal with the rest of it in its next session. That down payment would be just enough, according to a GOP aide, to allow the “sequester” of military and discretionary government spending cuts to be postponed or eliminated altogether.

Texas Representative Paul is firm:

Look for a “bipartisan” compromise in late December, with Republicans giving in to tax increases and settling for phony spending cuts that actually grow government, and Democrats caving [in] on defense cuts in exchange for tax increases.

This is how the government has always grown: both sides will sacrifice their pro-liberty, small government stances … in order to grow the government…

 

 

 

Senator Harkin Tries to Revive High-Frequency Trading Tax Bill

Senator Harkin Visits Downtown School

Senator Harkin Visits Downtown School (Photo credit: Phil Roeder)

More than a year ago Senator Tom Harkin (D-Iowa) introduced legislation to impose a tax on high-speed trading and it has languished in the Senate ever since. On Thursday he had a chance to breathe some life into the measure in an interview at MarketWatch.com during which he offered the same platitudes from a year ago.

High-frequency trading, he said, generates no benefit to the economy and therefore could be taxed with little negative impact. Such a tax could raise an estimated $350 billion over the next ten years, he added:

 I really don’t see any evidence that these high-speed traders add anything to the economy, but they do also create some aberrations in the market that have led to some disturbances.

On the one hand, my transaction tax doesn’t put them out of business but certainly they would have to pay 3 cents on every $100 in transactions they do. That’s really not very burdensome.

But also we need revenue. We have to get out of this deficit hole we’re in and this transaction tax is estimated to raise about $352 billion over ten years. That’s pretty substantial. And I don’t think it will do anything at all to hurt trading, what I call “real trading.”

This is a rehash of statements he made on his website back in November, 2009 when he, along with Representative Peter DeFazio (D-Ore.), introduced his bill. He explained then that it would be

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Don’t Tax Me; Don’t Tax Thee; Tax That Fellow Behind the Tree!

Tax

Tax (Photo credit: Tax Credits)

So said Russell Long, the Senator from Louisiana who served 39 years and whom the Wall Street Journal once called “the fourth branch of government,” so great was his influence. He got it right. The citizens are so dependent upon their government goodies that the entire discussion in Washington over the fiscal cliff is about increasing taxes and not cutting spending. The writer at Marketwatch.com got it exactly right:

As lawmakers negotiate to avoid the so-called fiscal cliff, the combination of tax increases and spending cuts that are due to take place on Jan.1, 2013, the silence on spending cuts is deafening. (my emphasis)

Some Republicans have tried, by outlining various cuts in spending that would bring the budget back to 2008 levels. But no one is listening:

House Republicans, both in the budget committee and in the Republican Study Committee, have outlined potential cuts that will bring spending back down to 2008 pre-recession levels. However, all Washington negotiators can do is talk about raising taxes, or not, and how much revenue can come from limiting deductions on one hand and economic growth on the other.

She says that Washington considers spending cuts as “poisonous.” We’ve heard this before. Cuts to Social Security was considered for years to be the third rail in politics: touch it and you die. George Bush trotted out a plan to modify Social Security with private accounts. Remember them? Didn’t think so. Down the memory hole.

Biden can’t believe the Republicans even want to

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Self-Fulfilling Recession: Big Companies Cut Back

double dip cones

(Photo credit: mark e dyer)

There has been much talk for many months about the “second” recession facing the US economy. I’ve written about it as well, noting the prediction from ECRI last year that we were headed for a double dip. The prediction was defended again in September by ECRI.

And many have predicted, including the Congressional Budget Office, that the fiscal cliff will cause another recession.

Now, those with money to spend, have decided to cut back:

U.S. companies are scaling back investment plans at the fastest pace since the recession, signaling more trouble for the economic recovery.

Half of the nation’s 40 biggest publicly traded corporate spenders have announced plans to curtail capital expenditures this year or next, according to a review by The Wall Street Journal of securities filings and conference calls.

It’s what they’re not spending on that is unnerving: the very

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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.

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