If On the Wrong Track, Why Go Left? - AnabolicMinds.com

If On the Wrong Track, Why Go Left?

  1. Snuggle Club™ mascot
    bpmartyr's Avatar
    Stats
    5'9"  175 lbs.
    Join Date
    Feb 2005
    Age
    41
    Posts
    4,443
    Rep Power
    27395

    Reputation

    If On the Wrong Track, Why Go Left?


    If On the Wrong Track, Why Go Left?
    Dennis Prager
    Tuesday, May 13, 2008

    Today's most widely accepted political belief is that because an unprecedentedly high percentage of Americans -- 81 percent -- believe the country is headed in the wrong direction, the Republicans are headed for a major defeat this coming November.

    If this is the case, it can only be because the American voter translates "headed in the wrong direction" as "because the Republicans have had their way, so it's time to let the Democrats have theirs."

    That should not be the case. I count myself as one of the 81 percent who believes America is headed in the wrong direction, and that is precisely why I am voting Republican. Moreover, I suspect I am not alone among the 81 percent in ascribing the wrong track to the leftist, not the conservative, influence on American life.

    But if "headed in the wrong direction" really does mean for most Americans that voting Democrat will put our country on the right track, it is hard not to conclude that America has begun the decline that has ended all great civilizations. For if the Democratic Party -- given how far left it has become -- comes to control Congress and the presidency, America's values will soon stray so far from what they have been since its founding that it is difficult to imagine ever being able to undo the change.

    Given that "on the wrong track" is defined as unhappiness with the economy, with President George W. Bush, and with the war in Iraq, let's analyze all this.

    First, are the 81 percent unhappy with their own economic status or with the economic direction of the country? They are obviously not the same things. But whichever it is -- and it may well be both -- why do most Americans believe the Democrats' prescriptions are going to help? Why will a huge tax increase on all Americans earning over $200,000, on capital gains for all Americans and on social security (if Barack Obama is elected) help the economy?

    When have tax increases ever helped an economy? Why will America almost alone among the industrialized democracies move in the direction of higher taxes? Are all these other countries that are lowering taxes harming their economies?

    Furthermore, the economic plans of the Democrats to have the government take over health care and increase taxes will expand the power and reach of the state more than ever before, and will therefore make more Americans dependent upon the state than ever before. These are earthquakes in the American value system. If there are any values that can meaningfully be called "American," self-reliance and limited government are among them. The movement from self-reliance to reliance on the state is truly "un-American." For those who recoil at the use of this term, it must be noted that it in no way implies less love of America, let alone lack of patriotism. It simply states the obvious truth that self-reliance, individualism and limited government have been basic and distinguishing American values, and the Democrats and the left aim to undo those underpinnings of American civilization.

    Second, regarding the unprecedentedly low popularity of President Bush, this, too, needs explaining and may not reflect well on the current state of Americans' values.

    George W. Bush has passed legislation -- such as prescription drug benefits for the elderly -- that Democrats would pass; he is a personally decent and honest man who has led perhaps the most scandal-free eight years in modern American history; he has kept America free from terror since 9-11 -- something no one, left or right, expected; pro-American leaders have been elected in European countries most identified with anti-Americanism -- Germany and France; and until the sub-prime loan-induced credit crisis, the economy has been among the most robust in American history.

    Now, undoubtedly the left will respond that this man is neither scandal-free nor decent since, in its view, he is a liar. "Bush lied" has been repeated by Democrats and the liberal media so often that they have both come to believe it. But it is the charge that is the lie. President Bush's claim that Saddam Hussein was developing weapons of mass destruction (WMD) was a mistake, not a lie. President Bill Clinton said the same thing when he was president, as did every major Western intelligence agency at the time of America's invasion.

    It is hard to believe that "Bush lied" is the primary reason for his low popularity ratings. If it is, we are in deep trouble. It means Americans have been irrationally influenced, almost brainwashed, by the media.

    Assuming, then, that "Bush lied" is not a primary reason for the president's unpopularity, the overwhelming explanation is presumably the Iraq War. But if so, that, too, represents an unfortunate decay in Americans' values. Whatever misgivings an American has about invading Iraq and removing Hussein, the facts are that America is winning now; that Iraq is becoming the first free and democratic Arab country; that Islamists are losing what they themselves call their most important war; and that, as a result of their barbaric cruelty in Iraq and their losing the war now, their popularity among Muslims (except Palestinians) is in decline.

    Do most Americans really prefer Obama's and the Democrats' pledge to leave Iraq to the Republicans' pledge to win this war? No matter how horrific, even potentially genocidal, the consequences would be to Iraqis? No matter how adversely it would affect potential U.S. allies who will no longer trust our commitments to them? And no matter how much it would weaken America's domestic security, given an Islamist victory in Iraq? If so, we are in deep trouble as a nation.

    If the answers to all these questions are that, by "wrong direction," Americans think we are too Republican and conservative and that a radically leftward turn -- the Democrats never had a leftist (as opposed to liberal) candidate win the presidency -- is what the country needs, we really are in decline.

    On the other hand, perhaps most of the 81 percent think that "wrong direction" means, among many other things, the following:

    -- Forty years of left-wing control of the news media, of Hollywood, of the public schools, of the universities and of nearly every big city government have nearly ruined those institutions.

    -- Forty years of a litigation explosion has had terrible social and economic effects.

    -- Children are being prematurely sexualized through early sex education.

    -- A generation of children is being frightened about too much -- from seesaws to dodgeball to ring-a-levio to secondhand smoke to the destruction of the world caused by global warming.

    -- The left's war against Judeo-Christian values as the bases of American values is leaving us morally rudderless.

    -- Redefining marriage to include people of the same sex for the first time in history, while compassionate to gays, will be disorienting to young people when forming their sexual identities.

    -- Multiculturalism is destroying the concept of an American culture and people. Obama and the Democrats even opposed declaring English as America's national language.

    So 81 percent of Americans are right. We are on the wrong track. But the future of America entirely depends on what track it is most Americans think is wrong, and if they really believe that the radical "change" Obama and the Democrats advocate will be the right track. If so, it may mark the beginning of the end of the America that our parents and their parents and their parents back to America's founding lived in. The left, given its demonization of America's history, would welcome that. Would the American people?
    Recent log:http://anabolicminds.com/forum/supplement-reviews-logs/213350-lean-efx-refined.html

  2. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by bpmartyr View Post
    When have tax increases ever helped an economy?
    When you are running a 500 billion dollar account deficit and you refuse to cut spending on anything.

    You wanted your war, you got it, now let's all pay up. Inflation is spiralling out of control. Domestic spending won't slow down until the Iraq war is over. Look at all the riders they attach to the war funding bill to get it through.

    Inflation is the number 1 killer of empires. I think we are entering our death spiral if something does not change on both the domestic and home front in terms of spending. Democrats want big government, and Republicans want big military, so lets pay for it now rather than pass the burden onto future generations. I am all for low taxes, but inflation is out of control right now. I am not a big fan of CPI either. How many families do you know that don't spend money a lot of money on food or energy?
    Last edited by DougMan; 05-21-2008 at 10:09 AM. Reason: Toned it down - too dramatic :)
  3. New Member
    Bum Mahoney's Avatar
    Stats
    5'8"  194 lbs.
    Join Date
    Feb 2008
    Age
    45
    Posts
    234
    Rep Power
    198

    Reputation

    The way to curb spending is to cut taxes. Prager is right on.
    •   
       

  4. New Member
    Nole1's Avatar
    Stats
    6'1"  225 lbs.
    Join Date
    Apr 2008
    Age
    45
    Posts
    332
    Rep Power
    245

    Reputation

    What? You don't think Gov't run Healthcare is a good idea? I mean, look what a fantastic job the Gov't has done running the Social Security program!!!

    Dems/libs will never admit that Clinton had many of the same ideas that Bush had when it comes to Saddam, but was just too weak to do anything more than verbal threats. When the WTC was bombed in 93 - BC made idle threats. When Sudan offered up OBL - Clinton didn't act to eliminate him. Now that Saddam's prison diaries show actual ties and relations with Al-Quaida, the media is ignoring that fact, as are the Dems.

    Tax cuts work - look at the economy from 00-05. The sub-prime mess has nothing to do with tax cuts, but instead everything to do with irresponsible people living beyond their means and being assisted in doing so by greedy banks/mortgage companies.

    Take a look at the $300B Farm Bill that Bush vetoed today (it'll pass anyway) and all the BS that will irresponsibly get thru thanks to our "democratic" Congress who can't stop giving away the milk.
  5. Never enough
    Board Moderator
    EasyEJL's Avatar
    Stats
    5'10"  205 lbs.
    Join Date
    Jun 2007
    Age
    46
    Posts
    31,830
    Rep Power
    768794

    Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation

    Quote Originally Posted by bpmartyr View Post
    So 81 percent of Americans are right. We are on the wrong track. But the future of America entirely depends on what track it is most Americans think is wrong, and if they really believe that the radical "change" Obama and the Democrats advocate will be the right track.
    Whats sort of interesting about this piece is that its something I have to remind my wife of in a way (and sometimes remind myself) in dealing with our 11 year old daughter (12 this month) very often I hear her telling the daughter "you are doing xxx wrong", but not follow up with how she should be doing it. When you are 12, knowing how you are supposed to load the dishwasher for instance isn't something you are born with. So saying the way its being done is wrong doesn't really help the situation, as it doesn't give her the tools to make it right.

    I very much worry that we will make a change just because we're unhappy with today, only to find that the change makes things far far worse. gas prices near $4 a gallon? Poor us, in the netherlands its nearing $10 a gallon, and you'd be hard pressed to find it less than $8 a gallon anywhere in europe. Ask those residents how well their socialist policies are working to keep their fuel prices down....

    Many things are far more affected by a global economy than the majority are willing to hear.
    This space for rent

    Phenadrol Log http://anabolicminds.com/forum/suppl...-hell-did.html - AMAZING fat loss results so far
  6. Senior Member
    Rogue Drone's Avatar
    Join Date
    Mar 2004
    Posts
    1,226
    Rep Power
    741

    Reputation

    Cutting Revenue/Taxes is a great economic stimulus, but if a Government never balances it's books by compensatory reductions in spending , you end up as the US is now, functionally bankrupt, living on Asian and Middle East Loans to keep our fiat currency afloat.

    Not for much longer can the world subsidize an economy that's being ripped apart with the dual forces of deflationary assets and inflationary commodities.
  7. New Member
    Nole1's Avatar
    Stats
    6'1"  225 lbs.
    Join Date
    Apr 2008
    Age
    45
    Posts
    332
    Rep Power
    245

    Reputation

    Quote Originally Posted by EasyEJL View Post
    Whats sort of interesting about this piece is that its something I have to remind my wife of in a way (and sometimes remind myself) in dealing with our 11 year old daughter (12 this month) very often I hear her telling the daughter "you are doing xxx wrong", but not follow up with how she should be doing it. When you are 12, knowing how you are supposed to load the dishwasher for instance isn't something you are born with. So saying the way its being done is wrong doesn't really help the situation, as it doesn't give her the tools to make it right.

    I very much worry that we will make a change just because we're unhappy with today, only to find that the change makes things far far worse. gas prices near $4 a gallon? Poor us, in the netherlands its nearing $10 a gallon, and you'd be hard pressed to find it less than $8 a gallon anywhere in europe. Ask those residents how well their socialist policies are working to keep their fuel prices down....

    Many things are far more affected by a global economy than the majority are willing to hear.
    Bingo to what you stated in Bold above. But everyone out there looking for "Change" refuses to hear any of that logic. They want "change" but have no real idea what they want changed or how to get there.
  8. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by Nole1 View Post
    They want "change" but have no real idea what they want changed or how to get there.
    Incorrect. One major thing I have pushed to be "changed" is for the passage of PAYGO as rule of law. Reduced deficits strengthen the dollar which makes commodities such as oil cheaper.
  9. Never enough
    Board Moderator
    EasyEJL's Avatar
    Stats
    5'10"  205 lbs.
    Join Date
    Jun 2007
    Age
    46
    Posts
    31,830
    Rep Power
    768794

    Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation

    taxation is less than 5% of the price of gas, and a defecit at the federal level only affects taxes, not oil companies and not OPEC.
    This space for rent

    Phenadrol Log http://anabolicminds.com/forum/suppl...-hell-did.html - AMAZING fat loss results so far
  10. New Member
    Vtaper's Avatar
    Join Date
    Jun 2005
    Age
    37
    Posts
    157
    Rep Power
    191

    Reputation

    Quote Originally Posted by EasyEJL View Post
    taxation is less than 5% of the price of gas, and a defecit at the federal level only affects taxes, not oil companies and not OPEC.
    Hey Easy, I think were gonna have to wait till after memorial day for Doug Man's Poli-Sci professor to come up with a response to this.
  11. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by Vtaper View Post
    Hey Easy, I think were gonna have to wait till after memorial day for Doug Man's Poli-Sci professor to come up with a response to this.
    Naw son, but my response will be more of the same.

    Here is a chart which somewhat explains my line of thought: http://www.kitco.com/ind/Turk/images/feb252008_1.gif

    This is the price of oil in terms of gold. Now that chart is slightly out dated as it is from February.

    But my basic argument is this: the economy is slowing and the feds wants to ease monetary policy and flood the market with dollars. This would allow banks to restore their balance sheets, and provide much needed liquidity to the real economy. The problem the dollar was already having problems because of the deficit, so this flood of dollars has destroyed our currency.

    The result is that the market is now seeking a hedge against a weaker dollar. Oil happened to be their commodity of choice.

    Also, remember that the market builds in expectations. I believe the market is guessing the fed wants to dump the dollar and inflate their way out of this mess. This building of expectations has lead to speculation and has now taken on a life of its own.

    This brings me back to my original point. We need to strengthen the dollar. The best way to do this is to return to a balanced budget. Spending is not coming down as I mentioned. Democrats love domestic spending, republicans love military spending. So the only way to change the expectations is to raise taxes to show we are serious about a strong dollar. I would love for reduced spending, but show me either party that is committed to it.

    A professor? Hardly. But you can be damn sure I am not going to fall for cheap gimmicks like suspending the gas tax when I cast my vote this November.
  12. Never enough
    Board Moderator
    EasyEJL's Avatar
    Stats
    5'10"  205 lbs.
    Join Date
    Jun 2007
    Age
    46
    Posts
    31,830
    Rep Power
    768794

    Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation

    Quote Originally Posted by DougMan View Post
    The result is that the market is now seeking a hedge against a weaker dollar. Oil happened to be their commodity of choice.
    I disagree, and believe that oil's price climb is more due to realization of the true shortage (the finite length of supply being under 60 years at current rate of use), as well as the huge increase in car sales + usage in china and india. China is now using exponentially more fuel as they were 5 years ago, even Buick sells 2x as many cars in China a year as they do in the US..... supply vs demand, has nothing in particular to do with the US dollar.


    Mind you, I don't disagree that we need to strengthen the dollar, but I don't believe it will affect gas pricing globally if we do
    This space for rent

    Phenadrol Log http://anabolicminds.com/forum/suppl...-hell-did.html - AMAZING fat loss results so far
  13. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    I see quite a bit of correlation in this chart:
    http://charts.barchart.com/chart.asp...BSTKIC&org=stk

    Up until a couple months ago it was pretty steady. Markets go through periods of inefficiencies for sure.

    As for China and India, they do play a role

    Showing latest available data. Rank Countries Amount (top to bottom)
    #1 United States: 20,730,000 bbl/day
    #2 China: 6,534,000 bbl/day
    #3 Japan: 5,578,000 bbl/day
    #4 Germany: 2,650,000 bbl/day
    #5 Russia: 2,500,000 bbl/day
    #6 India: 2,450,000 bbl/day

    They are growing at about 7%/year. Neither use dollars as their primary currency, which further adds to my argument of a weaker dollar reducing the buying power of US consumers.
  14. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by EasyEJL View Post

    we need to strengthen the dollar, but I don't believe it will affect gas pricing globally if we do
    The logic behind this statement is inaccurate.

    Just pulled off a random article from Yahoo! search:

    Oil rises on weak dollar, supply worries - Yahoo! News

    A majority of the articles you will see in the news on high oil prices begin in a similar manner.

    "Oil prices have climbed by around a third since the start of the year as investors seeking a hedge against inflation and the falling U.S. dollar pile into commodities."

    But that article does quote an analyst as saying that supply and demand factors as the main driving factors. My counter argument to that is just what I stated above, that a weak dollar makes oil relatively cheaper for people living in other countries, which in turns drives up demand in those countries. So I guess we will see. I am certainly not arguing that there are not supply/demand issues, but I do not believe they are the primary reason for the dramatic rise in oil seen in the past few years.
    Last edited by DougMan; 05-24-2008 at 07:42 PM. Reason: Spelling and Grammar
  15. New Member
    Vtaper's Avatar
    Join Date
    Jun 2005
    Age
    37
    Posts
    157
    Rep Power
    191

    Reputation

    Quote Originally Posted by DougMan View Post
    The logic behind this statement is inaccurate.

    Just pulled off a random article from Yahoo! search:

    Oil rises on weak dollar, supply worries - Yahoo! News

    A majority of the articles you will see in the news on high oil prices begin in a similar manner.

    "Oil prices have climbed by around a third since the start of the year as investors seeking a hedge against inflation and the falling U.S. dollar pile into commodities."

    But that article does quote an analyst as saying that supply and demand factors as the main driving factors. My counter argument to that is just what I stated above, that a weak dollar makes oil relatively cheaper for people living in other countries, which in turns drives up demand in those countries. So I guess we will see. I am certainly not arguing that there are not supply/demand issues, but I do not believe they are the primary reason for the dramatic rise in oil seen in the past few years.
    Well, the Pound is a strong currency in Great Britain and how are there gas prices looking? And a weak dollar drives up demand in other countries? How about modernization and progress in countries that were a hundred years behind the west in technology? That will drive up demand regardless of fluctuating currency, and if the supply stays the same the price goes up.

    So vote for the candidate who will drill in ANWR...
  16. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by Vtaper View Post
    Well, the Pound is a strong currency in Great Britain and how are there gas prices looking?
    Quite high becuase the British government levies heavy taxes on gasoline. Fuel Tax - PetrolPrices.com

    Looks like tax is over 50% of the price of gas in Britian.

    Quote Originally Posted by Vtaper View Post
    And a weak dollar drives up demand in other countries? How about modernization and progress in countries that were a hundred years behind the west in technology? That will drive up demand regardless of fluctuating currency, and if the supply stays the same the price goes up.
    Which is one of the arguments I make above. US citizens will be competing more and more with the Chinese and Indians for resources. So if they have stronger currencies then prices will rise for citizens of the US.

    My point is lower taxes without lower spending leads to a weaker currency, which leads to higher prices for imports, which leads to inflation, which leads to a weak economy.
    Last edited by DougMan; 05-25-2008 at 02:39 PM.
  17. New Member
    Vtaper's Avatar
    Join Date
    Jun 2005
    Age
    37
    Posts
    157
    Rep Power
    191

    Reputation

    Quote Originally Posted by DougMan View Post
    Quite high becuase the British government levies heavy taxes on gasoline. Fuel Tax - PetrolPrices.com

    Looks like tax is over 50% of the price of gas in Britian.



    Which is one of the arguments I make above. US citizens will be competing more and more with the Chinese and Indians for resources. So if they have stronger currencies then prices will rise for citizens of the US.

    My point is lower taxes without lower spending leads to a weaker currency, which leads to higher prices for imports, which leads to inflation, which leads to a weak economy.

    http://www.townhall.com/blog/g/01e03...7-cd74a629a921

    Well, taxes are a good start as you can see in the link I posted. And if you go to Obama's website, his proposed spending increases could equal $800 Billion(including huge entitlement spending from Santa Clause aka our Govt.), but of course, there will be tax increases......so heres the question: if that somehow gets gas prices down, why would it matter if you have less of YOUR money to spend on it?
  18. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    Quote Originally Posted by EasyEJL View Post
    I disagree, and believe that oil's price climb is more due to realization of the true shortage (the finite length of supply being under 60 years at current rate of use), as well as the huge increase in car sales + usage in china and india. China is now using exponentially more fuel as they were 5 years ago, even Buick sells 2x as many cars in China a year as they do in the US..... supply vs demand, has nothing in particular to do with the US dollar.
    Sure it does. These countries subsidize gas. China, India, etc..are purchasing oil in very large amounts because of current demand AND future demand but if you look at their increases its not on par with the price rise in oil. Its basically a perfect storm (which is actually fine in the long run for us). They need oil...oil is based SOLELY on US dollars...the dollar weakens, countries buy more oil, the price goes up. We do get hurt in the short term but it also puts pressure on them because they simply can't continue to subsidize gas/oil at these prices. Even last week their were riots because some Asian governments are announcing cutbacks on the subsidies for oil which in turn is driving gas prices up. In other words, the price of oil is forcing them to pass the price on to the consumer, not them. They are becoming more a free market system because they simply can't afford gas subsidies. If you force them into a more free market system, then everyone is on a level playing field.

    Now with those price increase comes fund managers dumping their money into oil which further increases the price. Its a lot of factors that is based on demand, but is surely fueled by a weak dollar, the restrictions of gas subsidies in emerging markets, and fund mangers dumping your local police, firefighter and government pension funds into oil.

    Mind you, I don't disagree that we need to strengthen the dollar, but I don't believe it will affect gas pricing globally if we do

    It definitely will. The stronger the US dollar, the less these governments will buy.
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  19. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    Quote Originally Posted by DougMan View Post
    T My counter argument to that is just what I stated above, that a weak dollar makes oil relatively cheaper for people living in other countries, which in turns drives up demand in those countries.
    These emerging countries subsidize their gas so in reality the price of gas has been cheap and stable for years....its had little to do with demand until they could actually purchase cars. The weak dollar helped initially in governments buying oil but now the price getting so high that they are cutting back on purchasing and their subsidy programs thereby increasing prices. So the weak dollar is actually causing high prices in gas globally.
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  20. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    Quote Originally Posted by Vtaper View Post

    if that somehow gets gas prices down, why would it matter if you have less of YOUR money to spend on it?

    Public perception. The price of gas has much more effect on the consumer attitude than raising your taxes an extra 1k/year.


    Overall people will be happier if they pay more for taxes but gas is $1/gallon than paying less taxes and spending $3/gallon.

    Plus, Presidents have very little to do with the actual economy....they don't set monetary policy and never will.
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  21. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by Soup Nazi View Post
    Public perception. The price of gas has much more effect on the consumer attitude than raising your taxes an extra 1k/year.
    And also market perception. Foreign investors are less likely to be interested in US companies if their profits are in a currency that is constantly falling. Or if they are interested, they have to lower their valutations.

    Inflation is just like a tax. You pay more for the same goods. Also this not just a tax on earnings, this is a tax on your savings as well. And in the case of gas this is a tax on post tax earnings. Meaning if you spend an extra 1K on gas, you would really need to earn closer to 1.5K or 2K in additional earnings by the time you pay federal/state/social security/Medicare taxes.

    But I agree that public perception plays a huge part of it. Economists obsess over consumer confidence, and it is hard to be confident when your absolute buying power is constantly diminishing.
  22. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    Quote Originally Posted by DougMan View Post
    And also market perception. Foreign investors are less likely to be interested in US companies if their profits are in a currency that is constantly falling. Or if they are interested, they have to lower their valutations.
    Foreign investment in US companies has risen dramatically BECAUSE of the weak dollar. Foreign governments buy American commodities BECAUSE of the weak dollar. If they took profits in their domestic currency they wouldn't invest...but they don't. Their investment and profits are in US dollars and if its cheaper to get in because of a better exchange rate than its all the more reason to invest here. The weak dollar doesn't keep them out (just the opposite), the 2nd highest corporate tax rate in the world does. There is a reason private equity firms in Dubai are trying to invest in American financial institutions. You want to keep them out? Keep the tax rate the same and raise capital gains taxes (like the Democrats propose) and you will see a large portion of that capital leave the market.


    Inflation is just like a tax. You pay more for the same goods. Also this not just a tax on earnings, this is a tax on your savings as well. And in the case of gas this is a tax on post tax earnings. Meaning if you spend an extra 1K on gas, you would really need to earn closer to 1.5K or 2K in additional earnings by the time you pay federal/state/social security/Medicare taxes.
    Sometimes you need inflation and a recession to break the bubble/burst cycles. Greenspan did it, Bernanke is doing it...they will never tell you that but its macroeconomics 101. Our inflation isn't even that high WITH a weak dollar. China, India, etc...have a far worse inflation problem on their hands than we do....its a major reason China is buying up US commodities.


    But I agree that public perception plays a huge part of it. Economists obsess over consumer confidence, and it is hard to be confident when your absolute buying power is constantly diminishing.

    Its diminishing because it was proportional too high in the last 10 years.
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  23. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by Soup Nazi View Post
    Foreign investment in US companies has risen dramatically BECAUSE of the weak dollar. Foreign governments buy American commodities BECAUSE of the weak dollar. If they took profits in their domestic currency they wouldn't invest...but they don't. Their investment and profits are in US dollars and if its cheaper to get in because of a better exchange rate than its all the more reason to invest here. The weak dollar doesn't keep them out (just the opposite), the 2nd highest corporate tax rate in the world does. There is a reason private equity firms in Dubai are trying to invest in American financial institutions. You want to keep them out? Keep the tax rate the same and raise capital gains taxes (like the Democrats propose) and you will see a large portion of that capital leave the market.
    .
    I meant taking into account currency risk when evaluating companies. A weak currency will encourage foreign investment; a plummeting one could be a risk. Although in the case of the US I doubt we are going to see a huge swing in currency. I was thinking more in terms of the situation seen down in Mexico, where the peso was getting re-pegged from time to time resulting in huge drops in its value. I guess since the USD is not pegged to anything that should not be a big problem.

    http://www.colorado.edu/Economics/co...-currency.html

    Also caught an interesting tid bit from that article that summarizes what I meant to say:

    "A volatile currency hampers international commerce as businesses must undertake the added expense of hedging against exchange rate risk in foreign exchange markets. In addition, a widely fluctuating currency (especially a depreciating one) discourages movements of foreign capital into domestic financial markets"

    It presents the other side of the situation though as well, when a currency is over valued.

    Quote Originally Posted by Soup Nazi View Post
    Sometimes you need inflation and a recession to break the bubble/burst cycles. Greenspan did it, Bernanke is doing it...they will never tell you that but its macroeconomics 101. Our inflation isn't even that high WITH a weak dollar. China, India, etc...have a far worse inflation problem on their hands than we do....its a major reason China is buying up US commodities.
    .
    The dollar began its decline against the Euro before the real estate crisis/current downturn. About 2003 is when really started its decline. Bernake can only do so much and really is inheriting a pretty big mess. I do not think there is much the Fed can do. If they raise interest rates the dollar strengthens, but they risk slowing growth and hurting people when their rates adjust.
    That is why I am for a balanced budget. As I mention above, I would MUCH prefer less spending. But cutting spending is not going to happen. If you cut defense spending or national security spending you are a coward, if you cut domestic spending you are heartless. And increased domestic spending will not stop until Iraq is over (Just one example of how padded the Iraq spending bills have gotten: http://www.lvrj.com/news/19245899.html). Americans want more and more out of their government, so I am suggesting we start paying for it rather than passing it off on future generations. I would love to hear ideas on where to cut spending.

    Quote Originally Posted by Soup Nazi View Post
    Our inflation isn't even that high WITH a weak dollar. China, India, etc...have a far worse inflation problem on their hands than we do....its a major reason China is buying up US commodities.
    .
    It could be worse is not really a great way to make policy. Although that is the current defense I keep hearing. It is not as bad as the 70's and it is not as bad as other countries.
    It could always be worse, but I think it is better to compare us to the developed world rather than the developing. The Euro zone is having its own inflation problem, but it sounds like their central banks are more up for the task.

    Quote Originally Posted by Soup Nazi View Post
    Its diminishing because it was proportional too high in the last 10 years.
    Last 16 years? http://biz.yahoo.com/ap/080527/consumer_confidence.html

    Sentiment is of course not a perfect indicator of the current state of the economy. I only commented on it because the issue of public perception was raised.

    I hope you are right and this is all part of Bernake's plan and it is just Econ 101, but the litany of interconnected problems facing this country is pretty complex.
  24. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Good article to counter doomsayers like myself on near term senitment.

    Why Consumers Are Underconfident: Financial News - Yahoo! Finance

    I promise no more AP/Yahoo! articles
  25. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    Quote Originally Posted by DougMan View Post
    I meant taking into account currency risk when evaluating companies. A weak currency will encourage foreign investment; a plummeting one could be a risk. Although in the case of the US I doubt we are going to see a huge swing in currency. I was thinking more in terms of the situation seen down in Mexico, where the peso was getting re-pegged from time to time resulting in huge drops in its value. I guess since the USD is not pegged to anything that should not be a big problem.

    The US dollar will never be as volatile as something that you suggest. You are basically comparing apples to watermelons. The weakness in the dollar is basically the reversal of a cycle that lasted about 10 years.


    "But let’s go back a little further, to the beginning of the present global business cycle in 1994-95. The world economy was in great shape at that time, perhaps a little too good, and tighter monetary conditions produced a slowdown that began in the U.S., spread to other countries, and eventually led to the Asian crisis, the Russian crisis, the Brazilian crisis and a deep global slowdown, especially in the developing world. The global economy recovered during 2002-03, reached full speed in 2004, and has been easing back to normal speed during 2005-06.

    That’s one complete cycle for the world. During the first half of this cycle (1995-2001) the U.S. dollar rose by about 30%, as the world economy slowed and staggered from one crisis to another. Since then, the dollar has retreated by about two-thirds of that amount as the world economy recovered. By that analysis, the dollar could have some further downside risk, but the conditions emerging now are virtually identical to those of 1995 – central banks are tightening, a slowdown is emerging in the U.S., and it will spread around the world during the rest of 2006-07. The world is in better shape today than it was in 1997, so no crises seem likely, but the dollar nevertheless should firm during the next 12-18 months as the world economy moderates.

    And then there is the long history of the dollar. During the past 30 years, the dollar’s fluctuations span a range of plus or minus 25-30%. The lows were in 1978-80 and 1990-95, and the highs were in 1984-85 and 2001-2002. On this analysis, the dollar is near the middle of its long-term fluctuation range – a reasonable value given the current stage of the global business cycle.

    The bottom line? The U.S. dollar is not weak. It is well within its normal historical range given the condition of the world economy."


    That was written in 2006 and its basically describing exactly what is happening. China's economy is approaching a slowdown, our dollar has basically hit stiff resistance at 72....the fed basically is not going to cut rates anymore (according to their own minutes) and the value of the dollar will rebound...like it always does. What this President or the next President says is basically irrelevant. Everyone who trades is just waiting when the fed reserve stops cutting rates.....when that happens, the commodity boom will burst and the dollar will strengthen. There is a reason why every trader and investor had a gold/oil/grain position in the last 9 months.

    When we go into recession, other countries follow...when we come out, they follow. The BRIC countries are already slowing down (although Brazil is a GREAT investment right now but that another subject).



    The dollar began its decline against the Euro before the real estate crisis/current downturn. About 2003 is when really started its decline. Bernake can only do so much and really is inheriting a pretty big mess. I do not think there is much the Fed can do. If they raise interest rates the dollar strengthens, but they risk slowing growth and hurting people when their rates adjust.

    Read above. Rates didn't slow growth in the 80's and 90's when interest rates were MUCH higher. We are still in historically low interest rates.

    The dollar peaked in 2001 and started to decline in 2001.

    Bernanke did what he could and even now the thought that they will not cut rates is causing investors to be bullish on the dollar...first time since 2005. Its already hit resistance and retested at 72.


    That is why I am for a balanced budget. As I mention above, I would MUCH prefer less spending. But cutting spending is not going to happen. If you cut defense spending or national security spending you are a coward, if you cut domestic spending you are heartless. And increased domestic spending will not stop until Iraq is over (Just one example of how padded the Iraq spending bills have gotten: ReviewJournal.com - News - Senate approves Iraq war spending bill). Americans want more and more out of their government, so I am suggesting we start paying for it rather than passing it off on future generations. I would love to hear ideas on where to cut spending.
    They said the same in the early 90's when we had a large deficit. What happened? Nothing. What you are talking about is basically politics that have nothing to do with the global economic patterns.

    Clinton cut defense spending by 60%. That's how he created a surplus...that's it. No major economic policy or grand scheme of his (since Greenspan was there setting monetary policy..the same thing he did for Reagan and Bush). He cut defense spending, took 20% of that and invested in social programs.

    That had absolutely no effect on the US dollar or the global markets. The spending of the US government is basically a pimple on a pimple compared to the global forex market. It has virtually no effect on anything unless they actually legislate something that directly effects our domestic market (like they did with the CRA amendments of 95 which created sub prime).


    It could be worse is not really a great way to make policy. Although that is the current defense I keep hearing. It is not as bad as the 70's and it is not as bad as other countries.
    It could always be worse, but I think it is better to compare us to the developed world rather than the developing. The Euro zone is having its own inflation problem, but it sounds like their central banks are more up for the task.
    Not really. They follow what we do. Always have, always will..well for a long time to come. Foreign investors love the weak dollar. Foreign government in terms of monetary policy HATE it.


    Last 16 years? May consumer confidence falls to near 16-year low: Financial News - Yahoo! Finance

    Sentiment is of course not a perfect indicator of the current state of the economy. I only commented on it because the issue of public perception was raised.

    I hope you are right and this is all part of Bernake's plan and it is just Econ 101, but the litany of interconnected problems facing this country is pretty complex.
    Sure its complex but just like dominos, one domino starts a whole chain. We are sitting here talking about a bad economy when we havne't even see ONE quarter of negative GDP. The early 90's and the late 70's were MUCH worse than this.


    We are making a correction in terms of purchasing power because someone making 60k a year shouldn't be buying 400k+ houses. They shouldn't be buying 30k SUV''s costing $70 to fill up. They shouldn't be taking out 100k home equity loans to buy cars and boats and whatever else they want. It was proportional too high for a while. This is a technical correction of a bursting bubble based off people being to purchase those things that in reality they never should have bought. Many people didn't like it, but in reality, it probably what is best for the US consumer and the economy in the long run.
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  26. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    We really should have a stock trading thread...heheh

    Pissed about gas prices? BUY OIL STOCKS!
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  27. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by Soup Nazi View Post
    We really should have a stock trading thread...heheh

    Pissed about gas prices? BUY OIL STOCKS!
    Haha definitely. Although after reading a few investing books it seems the way to do it is just to put your money into an index fund and hope the economy grows.

    As far as actually investing, perhaps you should place some call options on a USD ETF.
  28. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    Not yet...have to wait until the next fed meeting then wait a bit after that. Still trading sideways right now. Currencies are very slow moving and take time to reverse but once they do, they generally trend very nice for a very long time.

    I have some money in the Brazilian ETF (and Petrobras). Much better performance and economic outlook there.
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  29. Snuggle Club™ mascot
    bpmartyr's Avatar
    Stats
    5'9"  175 lbs.
    Join Date
    Feb 2005
    Age
    41
    Posts
    4,443
    Rep Power
    27395

    Reputation

    Quote Originally Posted by Soup Nazi View Post
    NWe are making a correction in terms of purchasing power because someone making 60k a year shouldn't be buying 400k+ houses. They shouldn't be buying 30k SUV''s costing $70 to fill up. They shouldn't be taking out 100k home equity loans to buy cars and boats and whatever else they want. It was proportional too high for a while. This is a technical correction of a bursting bubble based off people being to purchase those things that in reality they never should have bought. Many people didn't like it, but in reality, it probably what is best for the US consumer and the economy in the long run.

    Recent log:http://anabolicminds.com/forum/supplement-reviews-logs/213350-lean-efx-refined.html
  30. Professional Member
    size's Avatar
    Join Date
    Jan 2003
    Age
    42
    Posts
    4,232
    Rep Power
    2268

    Reputation

    Oil prices are controlled by an oligopoly that enables even greater price removal from an equilibrium point by speculation. Add to this an inflated dollar and you have prices rising even higher.

    The right path for any country is to encourage personal responsibility and discourage government intervention. The continual growth of the individual reliance on the government is truly unfortunate.

    There has also been a HUGE shift in how much debt an individual will lever. This is a worrisome trend that has been encouraged by the government intervention as the individual continues to think, "If something goes wrong, the government will take care of me".
  31. Board Sponsor
    DAdams91982's Avatar
    Join Date
    Mar 2004
    Age
    31
    Posts
    7,407
    Rep Power
    700731

    Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation

    Bottom line IS... Dems control the purse strings right now... so why arent they cutting funding to the war? Do you really think a Dem president is going to change the economy that much? Hell, the federal government doesnt even control inflation, the non government entity federal reserve does.

    So if anyone is to blame it is the reserve.

    Adams
    The Historic PES Legend
  32. Board Sponsor
    DAdams91982's Avatar
    Join Date
    Mar 2004
    Age
    31
    Posts
    7,407
    Rep Power
    700731

    Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation Reputation

    Quote Originally Posted by Soup Nazi View Post
    Pissed about gas prices? BUY OIL STOCKS!
    I think good for the short term, but from what i have read, the pendulum can only go so far until it has to start swinging the other way.

    So much for the theory of a war for oil.

    Adams
    The Historic PES Legend
  33. Registered User
    DougMan's Avatar
    Join Date
    Dec 2003
    Age
    30
    Posts
    221
    Rep Power
    241

    Reputation

    Quote Originally Posted by DAdams91982 View Post
    Bottom line IS... Dems control the purse strings right now... so why arent they cutting funding to the war? Do you really think a Dem president is going to change the economy that much? Hell, the federal government doesnt even control inflation, the non government entity federal reserve does.

    So if anyone is to blame it is the reserve.

    Adams
    This conversation had very little to do with democrats versus republicans... The issue was government debt as related to currency value. I think the 9.4 trillion dollars in government debt would be a pretty serious factor affecting the inflation of the money supply. Bobo/Kramer/Soup Nazi seems to be arguing it is not very relevant. I have not had time to look into the M3 or other money supply measures to see if this is correct. If it is not then that is good, as that means the fed can just print off our debt and it will not matter, right?

    The main part of the argument I do not totally buy is using past performance as an indicator for future results. I think factors such as the existence of a strong competing currency (the Euro), and the need for a whole list of factors needing to return to historical norms such as housing prices, savings levels and debt levels spell trouble for the US economy. No it is not as bad as the 70's yet, but as I stated before complacency is a bad way to set policy. Also the composition of the US economy has changed to include more financials, which judging by the last few months are much more susceptible to sudden collapse.
  34. I am faster than 80% of all snakes
    Dwight Schrute's Avatar
    Stats
    6'1"  221 lbs.
    Join Date
    Nov 2002
    Age
    41
    Posts
    12,911
    Rep Power
    7016

    Reputation

    Quote Originally Posted by DougMan View Post
    This conversation had very little to do with democrats versus republicans... The issue was government debt as related to currency value. I think the 9.4 trillion dollars in government debt would be a pretty serious factor affecting the inflation of the money supply. Bobo/Kramer/Soup Nazi seems to be arguing it is not very relevant. I have not had time to look into the M3 or other money supply measures to see if this is correct. If it is not then that is good, as that means the fed can just print off our debt and it will not matter, right?

    The fed has already hinted at a halt in rate cuts....the decreasing of printing and actually stated more concerne in strengthening the dollar. Why? Because its its approaching its traidtional low leve in terms of the 25-30% fluctiation. Much of this is a responde to what Greenspn did in the 90's. It has little to do with any administration.

    The main part of the argument I do not totally buy is using past performance as an indicator for future results. I think factors such as the existence of a strong competing currency (the Euro),
    That's always been there. If its not the Euro it was the Pound...if not the Pound it was the Yen.

    and the need for a whole list of factors needing to return to historical norms such as housing prices,
    approaching that now....We've had a 41% increase in sales from this time last year and this area is basically one of the hardest hit. Why? Price.

    savings levels and debt levels spell trouble for the US economy.
    Not much we can do about personal spending but the credit crisis basically eliminated the majority of the problem. People simply overspent and you are seeing the result now and available credit is diminishing. I mean, I bought my house being self employed with no income verification. That's just ridiculous and these banks are paying for it now.


    No it is not as bad as the 70's yet, but as I stated before complacency is a bad way to set policy.
    Nobody is complacent but forcing policy in terms of a historical perspective usually makes matters worse...not better. The housing crisis is a result of forcing ideology (Community Reinvestment Act) on the banks....not the free market.


    Also the composition of the US economy has changed to include more financials, which judging by the last few months are much more susceptible to sudden collapse.
    More financials because its more a global market and people need to start thinking in terms of that, rather than a domestically dominated market. The time of the US being the single most dominant economic power is going to be over and its not because we are doing something wrong, its because countries with 1/3 the worlds population are now following an economic model we've had in position for a century. You now have MUCH more competition globally rather than limiting competition to domestic markets.
    For answers to board issues, read the Suggestion and News forum at the bottom of the main page.
  •   

      
     

Similar Forum Threads

  1. need a little help getting on track
    By gabe9615 in forum Training Forum
    Replies: 1
    Last Post: 11-03-2009, 12:51 PM
  2. am i on the right track ?(please help)
    By cessna in forum Weight Loss
    Replies: 4
    Last Post: 04-06-2008, 01:31 PM
  3. YG and GI Track
    By AnonyMoose in forum Supplements
    Replies: 11
    Last Post: 11-17-2006, 12:19 PM
  4. TRACK!
    By 400runner in forum Sports Talk
    Replies: 7
    Last Post: 09-08-2005, 02:48 PM
  5. SD and Track
    By overandout in forum Anabolics
    Replies: 1
    Last Post: 04-14-2005, 10:33 AM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
Log in
Log in