Free Republic

don't read Slate Magazine all that often and I certainly don't read Daniel Gross that much. I have read his work on occasion and I didn't read him as a dogmatic liberal. I took him as a left of center moderate. That's why I was a bit surprised by his pathetic defense of the stimulus. The defense essentially comes down to two things 1)you can't criticize the stimulus because it hasn't really started yet and 2)that's all by design. As was planned from the start, in fact, only a small portion of the $787 billion has been spent. The Council...

The state of the dollar probably hasn’t been a first-tier political issue in the United States since, say, the presidential election of 1896. Back then, it manifested as whether or not America would stay on the gold standard or switch to a bimetallic one. (The William Jennings Bryan “cross of gold” speech and all that.)

After the grim jobs report for September, the latest D.C. watercooler rumor has the president extending a few different programs that are a part of the stimulus package. After another grim jobless report, President Obama is turning his attention to extending a lifeline to the unemployed and making the case that his health care plan would create jobs by making small business startups more affordable. The Obama administration has begun talks with congressional Democratic leaders on moves to extend health insurance subsidies, the $8,000 first-time home buyer tax credit and jobless benefits, congressional and administration officials told FOX News late...

Transportation Secretary Ray LaHood says the government has approved $1.22 billion in reimbursements to car dealers for sales under the Cash for Clunkers program.

At the end of fiscal 2008, which came on September 30 of last year, the American national debt stood at $9.6 trillion. That sum is, perhaps, quite beyond the imagining of most people. It is, after all, 250 million times the average per capita income. Even the total fortunes of the entire Forbes 400 list add up to less than 15 percent of it. To use a journalistic measure that dates back to the late 18th century—when the British national debt had become a major political issue in that country—if you laid 9.6 trillion silver dollars end to end, they...

Investor's Business Daily has an article that will raise some eyebrows for the mortgage market. Skyrocketing growth in loans from the Federal Housing Administration and Ginnie Mae have helped support the mortgage market — but could leave taxpayers on the hook for massive new losses. FHA-insured loans have more than tripled from 530,000 in fiscal year 2007 to 1.7 million thus far in 2009. The Government National Mortgage Association, which securitizes FHA loans, has boosted its mortgage-related issuance to $287 billion from $85 billion.

It's over, finished, done. And quiet returns to the auto showrooms of America. Cash-for-Clunkers has outlived its funding. But left us with a host of useful lessons. First, government forecasters are really bad at their job. The program was originally funded with $1 billion of taxpayer money to cover rebates of $3,500-$4,500 on cars traded in for more fuel-efficient models, and the money was expected to last for about six months. It lasted for one week.

When the credit crisis struck last year, federal regulators pumped tens of billions of dollars into the nation's leading financial institutions because the banks were so big that officials feared their failure would ruin the entire financial system.

The first seven months of the Obama administration seemingly make no sense. Why squander public approval by running up astronomical deficits in a time of pre-existing staggering national debt? Why polarize opponents after promising bipartisan transcendence?

The bloviators of the blogosphere have been in full roar the past few weeks over the claimed success of the economic stimulus program. Much of this was ignited by Christina Romer, chair of the President's Council of Economic Advisors, in a speech addressing the question of whether the stimulus was working--and concluding that it was, "absolutely."

The Obama administration on Tuesday increased its 10-year budget deficit projection to more than $9 trillion, an increase of about $2 trillion that is blamed on the bleak fiscal picture and the practices of the previous administration.

We've all heard that cash for clunkers is ending on Monday. Some of us have heard that only about 20% of the files have been processed. Even less than that have actually been paid. So, now, auto dealers are going to be racing against the clock to get their applications in to make sure they get paid.

It's standard operating procedure in D.C. When a politician has bad or embarrassing news to report, they wait until as late as possible on Friday and release said news. That's exactly what happened yesterday. The Obama administration will raise its 10-year budget deficit projection to approximately $9 trillion from $7.108 trillion in a report next week, a senior administration official told Reuters on Friday.

plan to do a lot more shopping at Whole Foods in the coming weeks. Mostly in response to the moronic boycott of the store now gaining momentum on the left.

In an April speech to the Economic Club of New York, the chairman of the Federal Deposit Insurance Corporation, Sheila Bair, took a stand on one of today’s most pressing economic questions. The idea that certain financial firms were “too big to fail,” she said, should be “tossed in the dustbin.” Congress should pay attention. Since the early 1980s,

H/T to the Weekly Standard) Here's a story that was all to predictable. A growing number of auto dealers say the process of getting paid under the government's "cash for clunkers" plan increasingly resembles some of the wrecks accumulating on their lots as part of the program. The slow payments coming from the federal government are reinforcing the paradoxical nature of the program for dealers: It has generated the most showroom traffic they have had in months while at the same time heaping unease, frustration and worry onto the industry's worst-ever downturn

After severe job losses in early 2009, the pace of job losses slowed starting in April, and the July numbers have brought more respite. Non-farm payroll job losses were 247,000 in July. However, the private sector lost 254,000 jobs. This is considerably better than analysts expected (around 325,000) but not good enough to claim that we are in the middle of a strong and sustainable recovery

started out like a song ... we knew we had a good thing going. And if I wanted too much, was that such a mistake? President Barack Obama’s answer to composer Stephen Sondheim’s question would be “yes”, were he the sort who readily admits error — which he most definitely is not.

The Obama Administration is making noises about the need for a second stimulus package. This is nuts. Hyped-up government spending is useless, if not damaging, for providing sustained economic growth. Our own experiences, as well as those of other countries, particularly Japan in the 1990s and the early part of this decade, have demonstrated that repeatedly.

Just over a month ago, Secretary Geithner spoke to Chinese university students and they laughed when he suggested that Chinese dollar assets were safe. Chinese university students are reported as having laughed at Geithner, the US Secretary of the Treasury, when he promised the Chinese students that Chinese assets in dollars are "safe". Geithner offered inclusion of China in the IMF as he sought multiple ways to engage China. One of the lesser reported aspects of the trip was Geithner's talk of change in the exchange rate between the Chinese currency and the US's.

There’s no question that current government policies for taxes, spending, and regulation are causing the U.S. to lose competitiveness in the global race for capital, prosperity, and growth. Of course, China has been moving in the direction of free-market capitalism for years. To some extent, this shows the positive benefits of America’s free-trade policies and its open-mindedness in helping nurture not only China growth, but also middle-class prosperity worldwide.

The air is seeping out of the Great Liberal Hot Air Balloon. American liberals have been hoping, wishing, and praying--okay, maybe not praying--for over a quarter-century for an end to the ghastly interlude of conservative dominance ushered in by Ronald Reagan. Surely it was all a bad dream, a waking nightmare, a bizarre deviation from the preordained path of history. With the Democratic congressional victories in November 2006, the nightmare seemed to be ending. And in November 2008, with the election of Barack Obama and increased congressional majorities, it seemed to be over. A new era had dawned.

The first thing to note about the financial crisis is that the federal government never had any business intervening in the personal decision of whether you want to own a home. There is no rational economic argument, or any argument I know of, that says the market of buying and selling homes is imperfect in some way, requiring government action. Construction firms have plenty of incentive to build homes and sell them. People who have the wherewithal have plenty of incentive to buy homes if they so choose. For the government to intrude into homeownership was an off-budget, nontransparent, backdoor...

The Obama administration will continue throughout the summer to proclaim that things are still on track. The stimulus, along with their entire domestic agenda, they will claim will work. All we need to do is give it more time. In reality, we will all be following the administration off the economic and financial cliff.

One of the most poignant criticisms of the stimulus when it was being debated was that most of the stimulus was not going to be spent until 2010 and beyond. Here we had a president proclaiming that the economic apocalypse was upon us. Then, he proclaimed we had no time to debate the stimulus. Yet, the president's own estimations pointed out that the stimulus would take years and years to spend. The argument I just made about the slow nature in which the stimulus would be spent was made effectively during the stimulus debate. At the same time, the country...

Congress and the president enacted a $787 billion fiscal stimulus package in February. Yet here it is July, and the desired effect on the economy has yet to be seen. Even though the program was aimed at boosting demand and creating jobs by pouring federal dollars into the economy, unemployment hit 9.5 percent in June, the highest rate in 26 years.

So far, there's been very little analysis or speculation over why the June job's report was so bad. That makes some sense for several reasons. First, one month's numbers almost always doesn't give anyone enough data to make any fair determination. Second, it's almost impossible to know exactly what caused the economy to move anyway.

After nine months of explosive monetary and fiscal stimulus, you'd think economic recovery would be upon us. But the June jobs report tells a much different story.

Paul Krugman used the occasion of the latest jobs numbers to continue peddling his idea that one stimulus isn't enough. Nobel-Prize winning economist Paul Krugman said the nation is on course for a "prolonged jobless" economic recovery unless the Obama administration steps in with a second round of government stimulus money.

If the government wants to spend money on a program — presuming it’s unwilling to simply roll the printing presses — it must choose between two ways of acquiring the needed funds. It can borrow the money, or it can raise it through taxation. Neither source is ideal. The disadvantage of raising taxes is obvious. The disadvantage of borrowing stems from markets taking notice, and — if you do it often and irresponsibly enough — punishing you for it.

In a 1789 letter to James Madison, Thomas Jefferson wrote: "The earth belongs to each of these generations, during its course, fully, and in their own right. The 2d. generation receives it clear of the debts and encumbrances of the 1st. The 3d of the 2d. and so on. For if the 1st. could charge it with a debt, then the earth would belong to the dead and not the living generation. Then no generation can contract debts greater than may be paid during the course of its own existence."

In Guys and Dolls, craps players desperate for diversion welcome the arrival of Nathan Detroit because "even when the heat is on it's never too hot" for Nathan to arrange some action. Today, Nathan Detroit is more likely to be a state legislator, a governor or a board of education commissioner than a Broadway gambler. Forty-eight of our states have now legalized at least some form of gambling, and in the wake of growing state budget woes, legislators are scrambling to expand government-controlled legalized betting to raise new revenues. Every recession, in fact, brings a little more state-authorized betting, so...

How do our elected officials sleep at night when the country is on a path to become the biggest spender and borrower of all time? We are drowning in red ink and it appears that no one with any legislative authority seems to recognize there's no Noah's Ark to save us from this flood of debt. The American people know this is a problem. The latest New York Times/CBS News poll found continuing high personal ratings for President Obama, but much lower numbers for specific parts of his agenda. When asked if the administration had developed a clear plan for...

The biggest financial news of th day was the disastrous performance of the Ten Year U.S. Treasury Bond offering today. US Treasury prices fell on Wednesday, sending benchmark yields to eight-month highs, after an auction of 10-year notes heightened concerns about the cost of financing the burgeoning U.S. budget deficit. It was the first test of the government's long-term borrowing ability since investors began to wonder last month whether the United States' prized AAA credit rating may be living on borrowed time.

When I first read this on Politico, I thought it was a joke. A day after announcing the acceleration of federal spending under his economic stimulus plan, President Barack Obama Tuesday called for binding legislation that would force a return to pay-as-you-go budgeting rules. The so-called paygo approach would mean the federal government could not launch new tax cut or entitlement programs without finding a way to pay for them with budget cuts or revenue increases. The president also used his appearance in the White House East Room to tout the administration’s success in allowing 10 federally bailed-out banks to...

The president continues to insist that he isn't responsible for the nearly two trillion dollar deficit we will have by the end of the year. He is trying to pull a misdirection hoping that no one blames him for the inevitable repercussions of unsustainable debt. Economics can be very complicated especially for those that don't make finance their profession. Yet, there are some fairly simple universal truths. First, debt, by nature, is not necessarily bad. If there was no debt, then we would only buy a home, a car, or go to college if we had enough money in the...

If you love numbers like I do, then analyzing the stimulus as well as the economy as a whole gives you plenty to look at. For instance, the stimulus cost $787 billion. So far, about $55 billion has actually been spent. About 1.6 million jobs have been lost since the stimulus was passed, and about 6 million jobs have been lost since the recession began at the end of 2007. Meanwhile, the president claims that the stimulus has created or saved 150,000 jobs. Now, he claims that the stimulus will save or create another 600,000 jobs over the summer. Meanwhile,...

The data is in for April. Here’s what happened: 1. Household personal income (inflation adjusted) rose but every penny - and then some - went into savings or paying down debts. Consumer spending, on which Obama is betting to stimulate the economy, actually fell. None of the stimulus money was sent. None.

First, let me take a moment to congratulate myself on being an oracle. Here's what I wrote in the early part of January. Unfortunately, so far all indications are that he (President Obama) will likely do the exact wrong thing. He wants a major stimulus right away. They are talking about $500-$700 billion and he still will likely have half of the current stimulus to spend (not to mention that Obama maybe forced to bailout the autos if President Bush doesn't and he now wants to bailout cities and states) In order to do this right, he wants borrow a...

The periods between 2005-2007 were especially booming periods for commercial mortgages. This is important to understand because commercial mortgages are overwhelmingly done as balloon loans. What this means is that borrowers pay a monthly payment for a set period of time, usually from 5-7 years, and then the balance is due, the balloon. So, what this means is that the years from 2010-2013 will see an explosion of balloons coming due on commercial mortgages. In fact, about $1.4 trillion will come due in those three years.

The banking collapse and the economic meltdown have prompted many Americans to turn to the federal government as indispensable savior, telling Congress and the president: We hope you can fix it; we want you to do whatever is necessary to fix it; and we don't care what it costs. That was not the sentiment in evidence at the tea party protests held on Tax Day.

Here's an easy way to know that the multiple bailouts include a lot of waste. Most of them try and accomplish the same thing from multiple perspectives. The economy really began to melt down when Lehman Brothers disintegrated. This had tremors throughout the credit system and credit dried up. Look at it another way. All the credit dried up because banks were holding on to far too much "toxic assets" which caused their balance sheets to to turn upside down and thus they had no money to lend. So, to solve this economic crisis somehow credit must flow again. To...

Let me be very clear on the economics of President Obama’s State of the Union speech and his budget. He is declaring war on investors, entrepreneurs, small businesses, large corporations, and private-equity and venture-capital funds.

Fox News just spoke with a source that revealed the outlines of President Obama's plan to cut the budget deficit in the long term. Barack Obama wants to cut the federal deficit in half by the end of his first term, mostly by scaling back Iraq war spending, raising taxes on the wealthiest and streamlining government, an administration official said Saturday as the president worked to finalize his first budget request. Obama's proposal for the 2010 fiscal year that begins Oct. 1 projects that the estimated $1.3 trillion deficit he has inherited from former President Bush will be halved to...

If you really think about it, President Obama's rhetoric doesn't match his actions. The President proclaims that this current economic crisis is one of the worst of all time. On the other hand, this stimulus is not merely a stimulus. It is also a vehicle for the President to accomplish many of his ideological goals. Now, if it's me, if the crisis is really this bad, I would just focus on stimulating the economy. Yet, President Obama sees this stimulus as not only an opportunity to accomplish many other ideological goals. Believing that one can do all of this simultaneously...

Much has been written in recent weeks concerning the Obama Administration’s early struggles and stumbles, particularly in matters such as properly vetting prospective cabinet nominees, differentiating between campaigning and governing, and staying on message during a rambling press conference. Some commentators have tried to downplay or dismiss these difficulties, while others have chalked them up as the inevitable errors of an amateur who has been pushed too far, too fast. What many of the pundits tend to overlook in their analyses of President Obama’s first weeks is that these early misadventures illustrate the petulance and arrogance that stand as the...

Here’s something new: instead of the customary attempts to put an optimistic gloss on the state of the economy, our governments are doing exactly the opposite. Over here Ed Balls tells us, more or less, that this is the worst recession since dinosaurs roamed the primordial swamps. Meanwhile President Barack Obama declared last week that “if we don’t act immediately, our nation will sink into a crisis that at some point we may be unable to reverse”. As The Economist commented, with some alarm: “The notion that [America] might never recover was previously entertained only by bearded survivalists stockpiling beans...

Whether it's TARP, the auto bailout, the plan to help distressed homeowners, and much of the stimulus, the government's response to the economic crisis has been to help all those that failed, took excessive risks, or acted irresponsible and/or incompetently. On the one hand, this is natural. Those that didn't do any of these things need no help. On the other hand, rewarding failure is a recipe for disaster. So, what is TARP? It's a program to prop up banks that took on risks that have now blown up on them. Far be it for me to normally agree with...

The market's initial assessment is decidedly negative and Dow plunged nearly 400 points upon digesting his plan. The general concensus was that the plan was far too vague and offered little tangible. I would have to concur. This plan can be summed up by "the devil is in the detail" and we got nothing in the way of detail. There are four plans to this plan.

Administration officials were greeted with sarcasm and laughter Monday night when they briefed lawmakers and congressional staff on Treasury Secretary Tim Geithner’s new financial-sector bailout project, according to people who were in the room.