Financial News

[southsider2k5]

Fixed that for you.

 

Or even better when they can find more people to screw out of money...

[NorthSideSox72]

The people with the most power in california benefit when nothing changes and the government keeps screwing over the other 99% of its citizens.

I know you guys, on both sides, like to think that every single politician and publci servant is evil and only concerned with maintaining the status quo... but that's not the case. And further, even if it was, this STILL makes no sense, because this kind of move is what gets people voted out of office.

 

Your paranoia is overriding your sense of logic.

 

[Texsox]

In theory, California is ultimately saving taxpayers money by not having those same taxpayers paying interest to whomever Cal would borrow from. The difference is the taxpayers (voters) get to see it. If lawmakers borrowed from another source, chances are no one would know, or care. So for transparency in government fans, this is probably a nice touch.

 

Better, why not cut back on spending, which is basically what they are asking some taxpayers to do.

[Y2HH]

In theory, California is ultimately saving taxpayers money by not having those same taxpayers paying interest to whomever Cal would borrow from. The difference is the taxpayers (voters) get to see it. If lawmakers borrowed from another source, chances are no one would know, or care. So for transparency in government fans, this is probably a nice touch.

 

Better, why not cut back on spending, which is basically what they are asking some taxpayers to do.

 

Governments don't know how to cut back on spending, because that ultimately means they have to lay off all the people they hired on that they didn't really need -- which is equivalent to throwing votes in the opponents basket. Getting reelected is more important than doing the right thing for your state/country.

[NorthSideSox72]

Shut up, Barney, you shouldn't even attempt to use words like "clearable" when you obviously don't know what that means.

 

I am all for getting swaps clearing houses set up, and setting capital requirement and reporting/audit rules in such a way as to make non-cleared swaps much more expensive. But trying to have the CFTC determine "which swaps" are "clearable" is an impossible task, since swaps by nature are one-off OTC contracts that can all be different from each other. These are not listed instruments.

 

[Balta1701]

Governments don't know how to cut back on spending, because that ultimately means they have to lay off all the people they hired on that they didn't really need -- which is equivalent to throwing votes in the opponents basket. Getting reelected is more important than doing the right thing for your state/country.

California made huge spending cutbacks at the state level already. It turned out that it did exactly what you'd expect; they cut an awful lot of jobs, gave people furloughs and pay cuts, that wound up causing more people to lose jobs because people weren't spending money, and thus pushed California's tax receipts even lower. Quite literally it is the exact opposite of a stimulus.

[Y2HH]

California made huge spending cutbacks at the state level already. It turned out that it did exactly what you'd expect; they cut an awful lot of jobs, gave people furloughs and pay cuts, that wound up causing more people to lose jobs because people weren't spending money, and thus pushed California's tax receipts even lower. Quite literally it is the exact opposite of a stimulus.

 

As many of those cutbacks as they made, it hardly made a dent in the grand scheme of things considering how far in deficit they are.

[Y2HH]

California made huge spending cutbacks at the state level already. It turned out that it did exactly what you'd expect; they cut an awful lot of jobs, gave people furloughs and pay cuts, that wound up causing more people to lose jobs because people weren't spending money, and thus pushed California's tax receipts even lower. Quite literally it is the exact opposite of a stimulus.

 

Oh, and the City of Chicago is doing this very thing right now -- forcing furloughs and pay cuts. That's pretty much why Daley is trying to sell off every resource the City has for up front money, but less than these things are worth in the long run.

[Balta1701]

As many of those cutbacks as they made, it hardly made a dent in the grand scheme of things considering how far in deficit they are.

You missed the point. The more cutbacks they made, the bigger the deficit got. It's the little Hoover version of stimulus.

[Texsox]

The only two entities guaranteed to spend every dime they have, governments and kids. Put money in their hands and instant stimulus.

[BigSqwert]

Wait. Did you just admit that you get stimulated by kids?

 

[Y2HH]

You missed the point. The more cutbacks they made, the bigger the deficit got. It's the little Hoover version of stimulus.

 

No, I got it.

 

And they should have expected that. Longer term that will self-correct, but that's their own fault for getting themselves in the place they're in now.

[southsider2k5]

As many of those cutbacks as they made, it hardly made a dent in the grand scheme of things considering how far in deficit they are.

 

I cannot tell you how much I hate this line of thinking. You don't have enough money, so why cut if it is going to be enough to plug the entire deficit. That is so counter to common sense, I don't know what else to say here. Its like thinking that you are unemployed, so you have to hurry up and spend all of your money, because you aren't going to have any soon anyway.

[southsider2k5]

California made huge spending cutbacks at the state level already. It turned out that it did exactly what you'd expect; they cut an awful lot of jobs, gave people furloughs and pay cuts, that wound up causing more people to lose jobs because people weren't spending money, and thus pushed California's tax receipts even lower. Quite literally it is the exact opposite of a stimulus.

 

Well that, and the largest recession in like 80 years.

 

All states have had huge cuts in their tax receipts. Its not like California is on an island there.

[Y2HH]

I cannot tell you how much I hate this line of thinking. You don't have enough money, so why cut if it is going to be enough to plug the entire deficit. That is so counter to common sense, I don't know what else to say here. Its like thinking that you are unemployed, so you have to hurry up and spend all of your money, because you aren't going to have any soon anyway.

 

No, no, no...don't take it as me saying that...I'm saying that in the 3rd person...that's how THEY think, and more often than not, that's why they do very little to change things, other than raising taxes on just about anything you could possibly purchase. That annoys me as much, or more, than it annoys you. I do not play the debt game. Aside from my mortgage, I have none...zero...zilch. And I have money saved/invested for troubling times.

 

I pay myself first. Always. And I don't borrow against an uncertain future. Ever. Every check, 6% to 401k, 10% to savings, the remainder is what I can spend. It's that simple, and it's that easy.

 

Debt, for lack of a better way of putting it, is modern day slavery. And I'm not talking about a mortgage. I'm talking debt. Credit card debt. Exorbitant interest rates on said debt. Working for A to pay B, only you're always behind, and will probably never catch up due to a combination of interest and the fact that you have to continue living, so you have certain expenditures you cannot avoid in the mean time. Debt, IMO = Slavery. Plain and simple. And I'll never do that to myself or my family unless absolutely forced by circumstances I couldn't even begin to explain.

 

And please, do not make silly comparisons to "actual slavery" and the hardships there in, that's not what this is meant to convey. In simple terms, it means you're working for someone else, someone that doesn't care if you're family starves or what have you...it means you aren't working for yourself anymore. And that = slavery.

Edited November 5, 2009 by Y2HH

[Texsox]

I cannot tell you how much I hate this line of thinking. You don't have enough money, so why cut if it is going to be enough to plug the entire deficit. That is so counter to common sense, I don't know what else to say here. Its like thinking that you are unemployed, so you have to hurry up and spend all of your money, because you aren't going to have any soon anyway.

 

Or if you are already in debt, cut your income.

[Cknolls]

I know you guys, on both sides, like to think that every single politician and publci servant is evil and only concerned with maintaining the status quo... but that's not the case. And further, even if it was, this STILL makes no sense, because this kind of move is what gets people voted out of office.

 

Your paranoia is overriding your sense of logic.

 

 

No, they are only concerned with retaining office. And this does not seem like a good way to retain office. But shame on ALL voters in Cally if they re-elect ANY of these boobs.

[Cknolls]

Oh, and the City of Chicago is doing this very thing right now -- forcing furloughs and pay cuts. That's pretty much why Daley is trying to sell off every resource the City has for up front money, but less than these things are worth in the long run.

 

 

And nothing will change until they amend the union pension benefits. This is not that hard people. Cut the benefits, make the employees pay more into their benefits/healthcare, or make it a mandatory 65 years until you can retire. Yes, it is a hard choice, and no politician has the balls to even mention it, but that is the sad reality. The benefits are not going away, and are only getting worse. Punting on the issue does not solve it.

[Balta1701]

And nothing will change until they amend the union pension benefits. This is not that hard people. Cut the benefits, make the employees pay more into their benefits/healthcare, or make it a mandatory 65 years until you can retire. Yes, it is a hard choice, and no politician has the balls to even mention it, but that is the sad reality. The benefits are not going away, and are only getting worse. Punting on the issue does not solve it.

Because as Tex always says, what we really want is a society where you don't retire until you're 75 and you have no health coverage afterwards.

[Cknolls]

Because as Tex always says, what we really want is a society where you don't retire until you're 75 and you have no health coverage afterwards.

 

 

Or a s***load of bankrupt cities. How do you pay for it?

[NorthSideSox72]

As expected, we went over the magic line. 10.2%. Total UE including underemployed and not looking for work is at 17%.

 

Bad bits: Big rise in people out of work more than 6 months (record), 22nd straight month of shedding jobs (record), average work week stable (bad because no more hours being put on for existing employees, which is a growth indicator).

 

Good bits: Number of jobs lost fell again and has done so for a few months, and temp jobs jumped (temp jobs usually come before FT jobs)

 

My additional take: We need small business to get this thing going. We need to put them in a better position to get credit in loans, but tax credits in targeted industries or even blanket ones would also help.

 

[Texsox]

And nothing will change until they amend the union pension benefits. This is not that hard people. Cut the benefits, make the employees pay more into their benefits/healthcare, or make it a mandatory 65 years until you can retire. Yes, it is a hard choice, and no politician has the balls to even mention it, but that is the sad reality. The benefits are not going away, and are only getting worse. Punting on the issue does not solve it.

 

Employees look at their total compensation. So it really doesn't make a difference if the base pay is $50,000 + $5,000 into the pension or $55,000 and the employee puts in $5,000. Hell, pay them $65,000 and make them contribute $10,00 for their health care.

 

And it seems we have called for pay cuts in every sector, and I'm asking this seriously, I am not an economist, how does it help if everyone takes a 10% pay cut?

[Cknolls]

Employees look at their total compensation. So it really doesn't make a difference if the base pay is $50,000 + $5,000 into the pension or $55,000 and the employee puts in $5,000. Hell, pay them $65,000 and make them contribute $10,00 for their health care.

 

And it seems we have called for pay cuts in every sector, and I'm asking this seriously, I am not an economist, how does it help if everyone takes a 10% pay cut?

 

Funny, like the gov't, you too failed to notice the household survey, which showed a loss of 589,000 jobs, but the birth/death model showed a gain of 86,000 jobs. Good thing our powers that be do not rely on questionable data to make their decisions. And before you attack the household survey, Mark Zandi was on CNBC this morning and said the household survey is a good barometer to use when exiting a recession.

[jasonxctf]

As expected, we went over the magic line. 10.2%. Total UE including underemployed and not looking for work is at 17%.

 

Bad bits: Big rise in people out of work more than 6 months (record), 22nd straight month of shedding jobs (record), average work week stable (bad because no more hours being put on for existing employees, which is a growth indicator).

 

Good bits: Number of jobs lost fell again and has done so for a few months, and temp jobs jumped (temp jobs usually come before FT jobs)

 

My additional take: We need small business to get this thing going. We need to put them in a better position to get credit in loans, but tax credits in targeted industries or even blanket ones would also help.

 

 

I have a question about the UE at 17%. I'll take live examples of my family and I'm curious who would count in the 17% number.

 

- My grandmother in a nursing home

- My father who retired from AA and is on a pension

- My mother who swears she wants a job (but doesn't really try) and tutors kids on the side for cash

- My brother-in-law who went back to school for his college degree after being a minor league baseball player

- My wife's aunt/uncle, who works part time as a school cafeteria worker and bus driver (who dont want to work more hours or they'll fall off unemployment benefits)

 

Who counts and who doesn't?

[Cknolls]

So we stress tested the banks with a peak unemployment rate of 10%. And the tests, which focused on adequacy of capital levels as of the end of 2010, presumed an economic bottom by mid next year.