http://www.breitbart.com/article.php?id=070725003528.djzk2x84&show_article=1
I've heard and seen a lot of published "chatter" by some otherwise very well educated sources concerning the limited and almost "benign" effect of the subprime mortgage debacle. What strikes me as shortsighted is the seeming unwillingness of these very public experts to address the wider implications of this issue.
What about the unemployment (construction workers, real estate brokers, mortgage brokers, etc) resulting from the real estate sales and construction downturn in most of the major urban areas of the country? What about the numbers of upside down properties that cannot be sold or refinanced to prevent foreclosure or bankruptcy? What about the ballooning effect of over-building and an exploding foreclosure rate in major metropolitan areas on the available inventory of housing units and the effect of increased consequential foreclosures?
It almost seems as if they are attempting to candy coat the issue and its overall implications. It is as if the country had a countrywide party, consumed all of the alcohol getting really drunk and the hangover has not yet set in.
Wednesday, July 25, 2007
Tuesday, July 24, 2007
Pre-Paid Calling Card Blues
http://www.sun-sentinel.com/business/sfl-flzprepaid0725nbjul25,0,1342002.story
Nothing new here. There have been numerous cases of calling cards with outrageous connect charges impacting the number of minutes available at published rates.
Although this is outrageous and targets those least able to afford these connect charges, the potential for for these cards being used as virtually untraceable tools in other criminal activity and terrorism cases is of more concern to me because the identity of the individual or organization activating and using these cards is not a prerequisite for their use.
Also, these cards purchased in large numbers at numerous locations for cash at the retail level have the money laundering potential for then being re-sold at a small discounted price else where.
Nothing new here. There have been numerous cases of calling cards with outrageous connect charges impacting the number of minutes available at published rates.
Although this is outrageous and targets those least able to afford these connect charges, the potential for for these cards being used as virtually untraceable tools in other criminal activity and terrorism cases is of more concern to me because the identity of the individual or organization activating and using these cards is not a prerequisite for their use.
Also, these cards purchased in large numbers at numerous locations for cash at the retail level have the money laundering potential for then being re-sold at a small discounted price else where.
Sunday, July 22, 2007
Super Rich Pay Less
www.msnbc.msn.com/id/19762041/site/newsweek
Regarding the Newsweek article entitled “Taxing The Super Rich” - I was both intrigued with and inspired by the attitude demonstrated in the quote attributed to Warren Buffett. It is my opinion that the assessment of Mr. Buffet is correct.
Large private-equity partnerships are capable of generating enormous sums of money. However, the partners of these firms are merely very high paid money managers who receive a percentage of the profits generated from the purchase and sale of the stock of publicly traded companies in exchange for their money management activities. In any other venue, the income that they generate from their money management activities would be treated as ordinary income subject to tax at the highest marginal income tax rate of 35%. It is galling that corruption at the congressional level has created a loop hole in the tax system that treats this ordinary income as long term capital gain income taxed at a maximum tax of 15%.
What is laughable and sad at the same time is the effort being marshaled by Wall Street to cast the closing of this terribly unfair loophole as an attack on the American capitalist system. Our system has never been exactly fair. But, neither is life. It just appears unseemly that a person making a billion dollar income pays tax at a rate that is lower than his own secretary. In fact our history is full of examples of instances wherein the super wealthy lobby for the benefit of paying little or no taxes on the basis that any tax that they pay somehow leads to an increase in impoverishment of those who are not super wealthy.
Apparently Mr. Buffett understands that to remain cohesive, those in power must scrupulously maintain a social contract that in fact if not in image actually supports the dreams and ambitions of those not yet in power.
Regarding the Newsweek article entitled “Taxing The Super Rich” - I was both intrigued with and inspired by the attitude demonstrated in the quote attributed to Warren Buffett. It is my opinion that the assessment of Mr. Buffet is correct.
Large private-equity partnerships are capable of generating enormous sums of money. However, the partners of these firms are merely very high paid money managers who receive a percentage of the profits generated from the purchase and sale of the stock of publicly traded companies in exchange for their money management activities. In any other venue, the income that they generate from their money management activities would be treated as ordinary income subject to tax at the highest marginal income tax rate of 35%. It is galling that corruption at the congressional level has created a loop hole in the tax system that treats this ordinary income as long term capital gain income taxed at a maximum tax of 15%.
What is laughable and sad at the same time is the effort being marshaled by Wall Street to cast the closing of this terribly unfair loophole as an attack on the American capitalist system. Our system has never been exactly fair. But, neither is life. It just appears unseemly that a person making a billion dollar income pays tax at a rate that is lower than his own secretary. In fact our history is full of examples of instances wherein the super wealthy lobby for the benefit of paying little or no taxes on the basis that any tax that they pay somehow leads to an increase in impoverishment of those who are not super wealthy.
Apparently Mr. Buffett understands that to remain cohesive, those in power must scrupulously maintain a social contract that in fact if not in image actually supports the dreams and ambitions of those not yet in power.
Monday, July 16, 2007
Making Money Counting Beans
http://money.cnn.com/2007/07/11/pf/college/starting_salaries/index.htm?postversion=2007071218
As the accounting profession evolves in response to the ever increasing level of business and transactional complications and level and quality of paperwork required to meet regulatory standards both by the profession itself and governmental bodies, it is no surprise that the value of "bean counters" has become more widely appreciated and. as a result, graduating salaries increased.
As the accounting profession evolves in response to the ever increasing level of business and transactional complications and level and quality of paperwork required to meet regulatory standards both by the profession itself and governmental bodies, it is no surprise that the value of "bean counters" has become more widely appreciated and. as a result, graduating salaries increased.
Friday, July 13, 2007
Trade Gap: We're Our Own Worst Enemy
http://www.portfolio.com/news-markets/top-5/2007/07/12/Trade-Gap-Swells
Yes, as this article reports, the trade deficit is swelling. It was $60 Billion in May 2007.
The weaker dollar (the currency gap) is not the only reason for a wider trade deficit. Other causes are cheaper overseas labor and manufacturing jobs going to foreign countries where there’s less environmental and workplace regulation. To stay competitive, U.S. firms have moved manufacturing operations overseas where labor costs, including health care and retirement benefits, have less impact on the total cost of making goods.
A significant level of functional illiteracy relating to U.S. high school graduates and differences in the quality of primary and secondary education systems is also encouraging U.S. employers of manufactured goods to move operations and jobs overseas further devaluing U.S. competitiveness and the U.S. dollar. Add to all of this a weak work ethic by both labor and management and you have a recipe for the size of our trade deficit. Without real measurable improvements in U.S. primary and secondary public education, and work ethic, U.S. competitiveness and the value of the U.S. dollar will continue to erode.
Now you might think that continuing erosion of U.S. dollar buying power is somehow good for the trade deficit imbalance because it is supposed lead to more U.S. exports. I disagree! If a weak currency were the primary reason for an increasing level of exports, the diminishing value of the dollar and the increasing value of other currencies would logically lead to export increases. That has not occurred.
In fact, much of the products manufactured in the U.S. are seen by the buying public worldwide as less reliable and technologically inferior than the products of Non-U.S. competitors. I believe that national governmental and corporate managerial arrogance as reflected in engineering and design standards combined with work force inefficiencies have led to most our current situation.
Yes, as this article reports, the trade deficit is swelling. It was $60 Billion in May 2007.
The weaker dollar (the currency gap) is not the only reason for a wider trade deficit. Other causes are cheaper overseas labor and manufacturing jobs going to foreign countries where there’s less environmental and workplace regulation. To stay competitive, U.S. firms have moved manufacturing operations overseas where labor costs, including health care and retirement benefits, have less impact on the total cost of making goods.
A significant level of functional illiteracy relating to U.S. high school graduates and differences in the quality of primary and secondary education systems is also encouraging U.S. employers of manufactured goods to move operations and jobs overseas further devaluing U.S. competitiveness and the U.S. dollar. Add to all of this a weak work ethic by both labor and management and you have a recipe for the size of our trade deficit. Without real measurable improvements in U.S. primary and secondary public education, and work ethic, U.S. competitiveness and the value of the U.S. dollar will continue to erode.
Now you might think that continuing erosion of U.S. dollar buying power is somehow good for the trade deficit imbalance because it is supposed lead to more U.S. exports. I disagree! If a weak currency were the primary reason for an increasing level of exports, the diminishing value of the dollar and the increasing value of other currencies would logically lead to export increases. That has not occurred.
In fact, much of the products manufactured in the U.S. are seen by the buying public worldwide as less reliable and technologically inferior than the products of Non-U.S. competitors. I believe that national governmental and corporate managerial arrogance as reflected in engineering and design standards combined with work force inefficiencies have led to most our current situation.
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