By Eddie Griffin
Friday, November 14, 2008
I would not call Jack Z. Smith, of the Fort Worth Star-Telegram, a one-day wonder in economics. But I agree with him on some things in his recent editorial “Job 1” for President Barack Obama. But there is a minor disagreement on bailing out the financial institutions, based upon my understanding of Economics 101.
I agree with the proposed financial assistance for the automakers. This is Jobs 1.
Employers shed 240,000 jobs in October, the 10th consecutive month of job losses, which total 1.2 million for the year. The unemployment rate has risen to 6.5 percent, says Smith.
It is obvious: First things first. Stop the bleeding. This can be done by job retention in the auto industry, jobs creation in the public works and government sectors, and extending unemployment benefits.
It is important to note this observation by Z. Smith:
It seems as if almost everyone in the business world is retrenching these days — even normally full-speed-ahead billionaire Boone Pickens of Dallas. He and his investment firm have lost $2 billion from plunging energy prices.
(Source: http://www.star-telegram.com/news/columnists/jack_z_smith//index.html)
As goes the oil market, so goes the energy industry. Unless the utility rates are held artificially high, wind power energy does not look as profitable to private investors. As for Pickens’s planned wind farm, Smith writes: “He’s putting on hold a huge Texas Panhandle wind farm with a price tag of $10 billion-plus.”
This is not the death knell for wind and solar powered energy. To the private sector, the ROI (return on investment) window is too long. But to the public sector, the investment would have an indefinite life span, thus providing the infrastructure for new employment, and an optimistic window of opportunity into the new 21st century society.
Here is an opportunity for a government public works project.
Barack Obama will be a forward-thinking president, one who knows that clean energy would solve two problems at once. First, it would help save the planet, and secondly provide jobs for a future energy industry.
The president-elect is also efficient, taking what legislation, laws, policies, and executive orders that already exist on the books and using them immediately to tackle the sore spots in the national economy, rather than wholly reinventing the wheel in his own image and waiting for new legislation from the Congress.
Z. Smith writes:
We need to take well-thought-out measures to shore up financial institutions. But we also must put a focus on minimizing unemployment and creating jobs.
The federal and state governments could do that by accelerating funding for badly needed infrastructure projects, including construction, expansion and repairs for roads, bridges and transit systems. With gas prices tumbling, long-overdue increases in state and federal fuel taxes could help pay for the projects, as an alternative to increasing already-high budget deficits.
Very good, Mr. Smith, you deserve an A-minus.
But I have a problem with the idea of “shoring up financial institutions” because of the popular myth that purports the DOW Jones to be index of the nation’s financial health. Far from the truth, is signifies Wall Street’s health. We just have all bought into the notion that what’s good for Wall Street is good for America.
We the stock market began its free fall, we are lead to believe that the sky is falling upon all of us. But the black cloud is only over Wall Street, and not the rest of America. We have a problem with the “trickle down” mechanism in the trickle down economy. There is too much drinking at the top and allow a sip at the bottom.
The problem with Ronald Reagan’s "Trickle Down Theory", as it applies to the current crisis, is the fact we forget that market behavior is human behavior, and who can figure out human behavior? Investors buy because they want to make a profit. They sell because of God knows what. That the stock market is currently jumping around in positive and negative territory can probably be best described as a game of financial chicken: Who can leave their money in the financial instruments and stocks long enough to reap a good gain, and who will get scared and pull out of the market first? This is why we saw a string of late day sell offs.
Maybe a fireman can put a fire out by spraying the roof. But if the fire is in the basement, why are we pouring out the Treasury up top of financial institutions. This kind of bailout does not pay the mortgage or consumer credit card debt. It only allows the financial institution investors to recuperate their losses, re-inflate their stock value, and receive deferred un-taxable capital gains, and dividends. This is Bailout Wall Street 101.
NEXT: The Law of Circulation Key to Economic Recovery
Friday, November 14, 2008
Thursday, November 13, 2008
Follow the bouncing Economy
Compiled by Eddie Griffin with Commentary
Thursday, November 13, 2008
REPORT:
WASHINGTON – Congressional Democrats are marshaling support for a rescue package to pump $25 billion in emergency loans to U.S. automakers in exchange for a government ownership stake in Detroit's car companies.
Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, and Sen. Carl Levin, D-Mich., are developing legislation that would let the auto industry tap into the $700 billion Wall Street rescue money, approved by Congress last month, to fund their business operations.
Treasury Secretary Henry Paulson said Wednesday that the auto sector was "critical" but that the financial industry rescue was not designed for car companies. "Any solution has got to be leading to long-term viability" for auto companies, Paulson said.
(Source: http://news.yahoo.com/s/ap/20081113/ap_on_go_co/auto_bailout)
OBSERVATION:
Too many hands are at the wheel on the bailout package, and the Treasury Secretary is swerving all over the road to economic recovery.
REPORT:
The Washington Post reports:
In the six weeks since lawmakers approved the Treasury's massive bailout of financial firms, the government has poured money into the country's largest banks, recruited smaller banks into the program and repeatedly widened its scope to cover yet other types of businesses, from insurers to consumer lenders.
Along the way, the Bush administration has committed $290 billion of the $700 billion rescue package.
Yet for all this activity, no formal action has been taken to fill the independent oversight posts established by Congress when it approved the bailout to prevent corruption and government waste. Nor has the first monitoring report required by lawmakers been completed, though the initial deadline has passed.
(Source: http://www.washingtonpost.com/wp-dyn/content/article/2008/11/12/AR2008111202846_pf.html)
OBSERVATION:
These are ripe circumstances to plunder the U. S. Treasury and leave the next President holding the bag with the hole in it.
REPORT:
Oil prices continued to slide, to near $55 a barrel Thursday before rebounding slightly, as bad economic news from the world's largest economies heightened fears that a global downturn will slash demand for crude.
By the afternoon in Europe, light, sweet crude for December delivery was up 44 cents to $56.60 a barrel, after falling to as low as $54.67, in electronic trading on the New York Mercantile Exchange.
(Source: http://news.yahoo.com/s/ap/20081113/ap_on_bi_ge/oil_prices)
OBSERVATION:
Remember all the campaign signs that said: DRILL HERE and DRILL NOW. Drilling new offsite oil wells would help lead us to economic recovery. At $55 a barrel, the exploration and drilling is not worth it.
EDDIE GRIFFIN ANALYSIS:
Drilling explorations will not factor into the immediate economic recovery. Therefore, offshore drilling and Alaskan explorations need to be tabled. We must examine the theory behind the assumptions and actions now being taken by the government.
The Ronald Reagan Trickle Down Theory is a top-down approach to expanding the economy. Even if the theory were valid, the U. S. economy must get up and back running as soon as possible. Trickle Down from the banks to the consumers was too slow. Those who suffered the greatest financial losses in the free fall of the market were looking to be first for recuperating equity value from the government’s $700 billion infusion.
What have we purchased so far with the $700 billion? Can anyone tell me, with certainty, since the report is late and overdue and there are no overseer occupying the Oversight position as required by the legislators, what have we gotten back for our taxpayer buck?
Do we own 80% of AIG? Why leave 20% privately own and we, taxpayers, have no voting power as to who constitutes the boards and executive payer. Are we, indeed, proposing more cash infusion into the company?
One day, Treasury Secretary Paulson was planning to buy up financial institutions’ “toxic assets”. Then he scraps that plan to move on to proposing to buy up bank stocks. I can hardly hold my breath for the next change in course. I’m getting dizzy trying to watch the bouncing ball.
Somebody doesn’t know what they are doing. (Mark that as the understatement of the year).
RECOMMENDATIONS:
Since some banks are hording their capital, they need not be given another dollar of taxpayer money. And, the same applies for banks that use their government cash infusion to re-inflate their stocks and pay dividends. Bonuses and excessive compensation for poor performance should not be tolerated. Heads should roll, and white collar criminals sent to prison.
The Auto Industry needs financial help to stave off bankruptcy. Should we or shouldn’t we? The Treasury Secretary says no.
When we bailed out Wall Street, we opened the floodgates every distressed industry in the nation, the auto industry included. But here is a key sector of our economic with the largest percentage of our skill workforce. Why should they go to flipping burgers?
The financial aid to be given the auto industry should be, as with other bailout client, an investment into their stocks and restructuring of our public-private relationship. Any aid should be conditional upon technological advancement that leads us to energy independence.
NEXT: The Housing Industry.
Thursday, November 13, 2008
REPORT:
WASHINGTON – Congressional Democrats are marshaling support for a rescue package to pump $25 billion in emergency loans to U.S. automakers in exchange for a government ownership stake in Detroit's car companies.
Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, and Sen. Carl Levin, D-Mich., are developing legislation that would let the auto industry tap into the $700 billion Wall Street rescue money, approved by Congress last month, to fund their business operations.
Treasury Secretary Henry Paulson said Wednesday that the auto sector was "critical" but that the financial industry rescue was not designed for car companies. "Any solution has got to be leading to long-term viability" for auto companies, Paulson said.
(Source: http://news.yahoo.com/s/ap/20081113/ap_on_go_co/auto_bailout)
OBSERVATION:
Too many hands are at the wheel on the bailout package, and the Treasury Secretary is swerving all over the road to economic recovery.
REPORT:
The Washington Post reports:
In the six weeks since lawmakers approved the Treasury's massive bailout of financial firms, the government has poured money into the country's largest banks, recruited smaller banks into the program and repeatedly widened its scope to cover yet other types of businesses, from insurers to consumer lenders.
Along the way, the Bush administration has committed $290 billion of the $700 billion rescue package.
Yet for all this activity, no formal action has been taken to fill the independent oversight posts established by Congress when it approved the bailout to prevent corruption and government waste. Nor has the first monitoring report required by lawmakers been completed, though the initial deadline has passed.
(Source: http://www.washingtonpost.com/wp-dyn/content/article/2008/11/12/AR2008111202846_pf.html)
OBSERVATION:
These are ripe circumstances to plunder the U. S. Treasury and leave the next President holding the bag with the hole in it.
REPORT:
Oil prices continued to slide, to near $55 a barrel Thursday before rebounding slightly, as bad economic news from the world's largest economies heightened fears that a global downturn will slash demand for crude.
By the afternoon in Europe, light, sweet crude for December delivery was up 44 cents to $56.60 a barrel, after falling to as low as $54.67, in electronic trading on the New York Mercantile Exchange.
(Source: http://news.yahoo.com/s/ap/20081113/ap_on_bi_ge/oil_prices)
OBSERVATION:
Remember all the campaign signs that said: DRILL HERE and DRILL NOW. Drilling new offsite oil wells would help lead us to economic recovery. At $55 a barrel, the exploration and drilling is not worth it.
EDDIE GRIFFIN ANALYSIS:
Drilling explorations will not factor into the immediate economic recovery. Therefore, offshore drilling and Alaskan explorations need to be tabled. We must examine the theory behind the assumptions and actions now being taken by the government.
The Ronald Reagan Trickle Down Theory is a top-down approach to expanding the economy. Even if the theory were valid, the U. S. economy must get up and back running as soon as possible. Trickle Down from the banks to the consumers was too slow. Those who suffered the greatest financial losses in the free fall of the market were looking to be first for recuperating equity value from the government’s $700 billion infusion.
What have we purchased so far with the $700 billion? Can anyone tell me, with certainty, since the report is late and overdue and there are no overseer occupying the Oversight position as required by the legislators, what have we gotten back for our taxpayer buck?
Do we own 80% of AIG? Why leave 20% privately own and we, taxpayers, have no voting power as to who constitutes the boards and executive payer. Are we, indeed, proposing more cash infusion into the company?
One day, Treasury Secretary Paulson was planning to buy up financial institutions’ “toxic assets”. Then he scraps that plan to move on to proposing to buy up bank stocks. I can hardly hold my breath for the next change in course. I’m getting dizzy trying to watch the bouncing ball.
Somebody doesn’t know what they are doing. (Mark that as the understatement of the year).
RECOMMENDATIONS:
Since some banks are hording their capital, they need not be given another dollar of taxpayer money. And, the same applies for banks that use their government cash infusion to re-inflate their stocks and pay dividends. Bonuses and excessive compensation for poor performance should not be tolerated. Heads should roll, and white collar criminals sent to prison.
The Auto Industry needs financial help to stave off bankruptcy. Should we or shouldn’t we? The Treasury Secretary says no.
When we bailed out Wall Street, we opened the floodgates every distressed industry in the nation, the auto industry included. But here is a key sector of our economic with the largest percentage of our skill workforce. Why should they go to flipping burgers?
The financial aid to be given the auto industry should be, as with other bailout client, an investment into their stocks and restructuring of our public-private relationship. Any aid should be conditional upon technological advancement that leads us to energy independence.
NEXT: The Housing Industry.
Tuesday, November 11, 2008
New VA Outpatient Clinic: Answer to a Prayer
Happy Veteran's Day!
From Eddie Griffin
Tuesday, November 11, 2008
On yesterday, I attended the groundbreaking ceremony for the new VA Outpatient Clinic in Southeast Fort Worth. It was a prayer answered and dream come true for all of us, for veterans in need of more expansive medical care, for doctors and nurses now working in an overcrowded facility, for the chamber of commerce and the African-American community, and for City Councilwoman Kathleen Hicks who championed the cause of economic development in Southeast Fort Worth, and for U.S. Congressman Michael C. Burgess, MD, who push the issue in Congress, for Commissioner Roy C. Brooks, State Representative Marc Veasey, and other political leaders who saw the need and answered the call for disabled veterans like myself.
From the Star-Telegram:
The ceremony along Interstate 20 drew dozens of veterans, doctors and nurses, city and state officials and Reps. Michael Burgess, R-Lewisville, Joe Barton, R-Arlington, and Chet Edwards, D-Waco, who is rumored to be a candidate for President-elect Barack Obama’s secretary of Veterans Affairs.
All three congressional leaders said improving healthcare for veterans is a top priority.
"We’re not going to just honor you with speeches on Veterans Day," Edwards said. "We’re going to honor you with budgets every day."
Veterans who live in Tarrant, Parker, Wise, Johnson, Hood and other counties have long bristled at the discrepancy between the outpatient-only facility in Fort Worth and the major hospital in Dallas. The clinic, opened in 1992, is 45,000 square feet and built for that number of annual patient visits.
This year, the clinic will record 165,000 visits and is so overcrowded that VA officials closed enrollment for new veterans in late 2006, forcing them to get care in Dallas.
Burgess, a physician, said he knows that kind of demand "wears on you. That hurts the ability of the physicians and nurses to deliver good care."
“We worked hard for the first facility through Jim Wright’s office,” said Antonio Morales of Fort Worth, the national commander of the American GI Forum. “That was a major milestone at that time. But now this new facility will mean veterans won’t have to sit around and wait all day for care.”
Hard Work Pays Off
The VA Outpatient Clinic was conceived in 2005. However, we became familiar with the plan during Congressman Burgess’ Economic Summit of 2007, when community activists like Pastor Kyev Tatum and myself, were able to see the plan in a bit more detail.
The congressman delivered, Black Chamber President Devoyd Jennings reminded me. Not only did he deliver, we were breaking ground in record time. And, we are told that Burgess is the leading medical authority in Congress.
Eddie Griffin Commentary
Unlike other vocal constituents, I have never asked the congressman for anything that would benefit me personally. But this is one that I needed. Being a disabled vet myself, I admit that, due to the long waits at the old VA facility, I have neglected my own personal health issues by routinely missing doctor’s appointments. Maybe now that might change.
Thanks to Burgess, Barton, Edwards, Veasey, Brooks, and Hicks for their leadership in office and their reelections. We wish them much success, because their success is our success.
From Eddie Griffin
Tuesday, November 11, 2008
On yesterday, I attended the groundbreaking ceremony for the new VA Outpatient Clinic in Southeast Fort Worth. It was a prayer answered and dream come true for all of us, for veterans in need of more expansive medical care, for doctors and nurses now working in an overcrowded facility, for the chamber of commerce and the African-American community, and for City Councilwoman Kathleen Hicks who championed the cause of economic development in Southeast Fort Worth, and for U.S. Congressman Michael C. Burgess, MD, who push the issue in Congress, for Commissioner Roy C. Brooks, State Representative Marc Veasey, and other political leaders who saw the need and answered the call for disabled veterans like myself.
From the Star-Telegram:
The ceremony along Interstate 20 drew dozens of veterans, doctors and nurses, city and state officials and Reps. Michael Burgess, R-Lewisville, Joe Barton, R-Arlington, and Chet Edwards, D-Waco, who is rumored to be a candidate for President-elect Barack Obama’s secretary of Veterans Affairs.
All three congressional leaders said improving healthcare for veterans is a top priority.
"We’re not going to just honor you with speeches on Veterans Day," Edwards said. "We’re going to honor you with budgets every day."
Veterans who live in Tarrant, Parker, Wise, Johnson, Hood and other counties have long bristled at the discrepancy between the outpatient-only facility in Fort Worth and the major hospital in Dallas. The clinic, opened in 1992, is 45,000 square feet and built for that number of annual patient visits.
This year, the clinic will record 165,000 visits and is so overcrowded that VA officials closed enrollment for new veterans in late 2006, forcing them to get care in Dallas.
Burgess, a physician, said he knows that kind of demand "wears on you. That hurts the ability of the physicians and nurses to deliver good care."
“We worked hard for the first facility through Jim Wright’s office,” said Antonio Morales of Fort Worth, the national commander of the American GI Forum. “That was a major milestone at that time. But now this new facility will mean veterans won’t have to sit around and wait all day for care.”
Hard Work Pays Off
The VA Outpatient Clinic was conceived in 2005. However, we became familiar with the plan during Congressman Burgess’ Economic Summit of 2007, when community activists like Pastor Kyev Tatum and myself, were able to see the plan in a bit more detail.
The congressman delivered, Black Chamber President Devoyd Jennings reminded me. Not only did he deliver, we were breaking ground in record time. And, we are told that Burgess is the leading medical authority in Congress.
Eddie Griffin Commentary
Unlike other vocal constituents, I have never asked the congressman for anything that would benefit me personally. But this is one that I needed. Being a disabled vet myself, I admit that, due to the long waits at the old VA facility, I have neglected my own personal health issues by routinely missing doctor’s appointments. Maybe now that might change.
Thanks to Burgess, Barton, Edwards, Veasey, Brooks, and Hicks for their leadership in office and their reelections. We wish them much success, because their success is our success.
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