QE3 has worn off already?!!
Is Wall Street afraid of Romney?
What does Obama's dismal debate effort mean to Wall Street and why?
They'd better get on the job early today. Most of the charts I've looked at today are sitting a fraction of a percent above serious supports, the kind with a lot of air below. They set this up by manipulating the markets so much that there aren't many good stopping points. Add QEternity potentially killing the Bernanke put and we may see some serious carnage if/when those supports are broken. Ben might be soiling his panties right about now.
Thoughts?
QE3 has yet to take effect and is ongoing. It takes 6-12 months for an easing program to take effect.
ReplyDeleteThe market has deteriorated thanks to the debt ceiling debate. Fundamentals are also looking ugly i.e. GDP data and soft manufacturing data and worse-than-expected consumer spending numbers.
Markets, not consumers, will feel all the benefits with QE3. Consumers will actually take a beating because commodity prices -- oil and food prices -- will jump as the Fed pumps more dollars into the economy.
Just saying.
My QE comment was relative to the press buzz. Every QE is only about markets, your commodity price comment is accurate. We're all fucked as long as the current admin is allowed to exist.
ReplyDeleteTD.
ReplyDeleteInteresting points particularly "We're all f...ed as long as the current admin is allowed to exist.".
Thinking back 4 years was everything sweetness and light in the Capital? Did you have no fiscal debit? Were taxes inequitable and was the standard of living for all Americans so much better than it is today?
Now, do you really want, after 4 years to go back to the Bush era? I would appreciate responses from both sides of the fence please.
Cheers from Aussie
K,
DeleteThings were better 4 years ago.
We didn't have 23 million unemployed.
We did have 10 trillion in debt, today 16.1 trillion.
We had 21 million on Food assistance, today we have 48 million on food assistance.
Taxes were reduced under Bush. 10 million Americans left the tax rolls. Obama renewed the tax cut.
Today he wants to renew it for those under 250K. the top 10% of Americans pay 70% of Federal Income Taxes.
The median effective tax rate for a middle class family of 4 is 5.6%, the lowest in recent history.
Many people lost their homes during the housing crisis, no president can be blamed for the crisis however Congress and the Federal Reserve can take a bow. Many have not recovered from that disaster.
People received 99 weeks of unemployment as there are no jobs.
Mr. Obama interceded in the auto industry crisis. Obama claims credit for saving the industry. 2600 dealerships at 50 employees went out of business when the administration insist they downsize brands. All of the employees at Hummer, Pontiac and Saturn were terminated. The tax payers will never be repaid.
800 billion was spent on a stimulate package that failed to stimulate.
The TARP funds that were paid back were respent by the Obama administration that failed to stimulate the economy.
No one wants to go back to the Bush era, no one should want to stay in the Obama era.
We need to move on, address our out of balance budget. Our debt, our bloated government, our healthcare mess, our economic disaster. Lots to do and no one has stepped up to the problems. Cutting taxes will not fix the mess, raising taxes will not fix the mess. We need to get our economy into gear and then address taxes and spending.
DeleteLou
Many thanks, as always your posts are thought provoking which is as it should be.
If I read you correctly, you are equally unhappy with Republicans and Democrats. From you post above” Lots to do and no one has stepped up to the problems. Cutting taxes will not fix the mess; raising taxes will not fix the mess. We need to get our economy into gear and then address taxes and spending".
From my reading to date, I agree totally but also from my reading to date, the country is so divided neither side can expect support from the Congress unless you have a Pres and both houses of the same persuasion. Do you agree with this assessment? I know very few of the present lot by reputation but I have not heard of the likes of Tip O’Neill recently and he died almost 20 years ago. So my question now becomes, who do you want to see in the big house for the next four years?
As an aside, we have major problems with our National Parliament at present. Perhaps there is a worldwide shortage of Statesmen, a different breed of animal to Politicians
Cheers from Aussie
The problem with one party rule was clearly portrayed by the Democrats in 2009 and 2010.
ReplyDeleteThe Democrats went to excess of excluding and totally marginalize the Republican representatives in both houses which was tantamount to isolating and marginalizing a large segment of the population. It was so egregious that they were turned out in large numbers in 2010. No compromise or attempt to compromise. They proceeded to push through legislation that was their signature legislation unpopular with the majority of Americans. The Democrats still have not realized that fact. This is the division you see today in this country. An uncompromising president Obama unlike President Clinton.
It's far to late for Obama to compromise and fix the divisions as that isn't his way of doing business. He is the master of divisiveness and alienation. A prime example is the wealthy. He has marginalized and dividing the country claiming they just do not pay their fair share. Top 10 percent pay 70% of Federal Income Tax. While the middle class, the median middle class family of 4 pay 5.6% after deductions of their income in Federal Income Tax. Nothing is said of this in the Media. The wealthy will pay more as Obamacare kicks in as they are being taxed their fair share to pay for the 30 million uninsured today. Yet Obama and his supporters want more. Then you have his chief lieutenants, Harry Reid and Nancy Pelosi. Harry has blocked all legislation in the last 2 years while the media has pounded the Republicans as do nothing. No attempt at compromise from Harry and his Democrats in the Senate. Nancy has now been marginalized with their defeat in 2010 however did her share in marginalizing the minority in the House. Both must go as well as Obama. Both Republican leaders must also go as they are as guilty as Reid and Pelosi, no attempt at compromise.
In the past Republicans under GWB passed legislation supporting their causes however their legislation was not as far reaching or unpopular with the country.
The only way to put this nation right is for the leaders of both parties in the House and Senate need to be ousted from their comfy seats.
Hope that is helpful.
Lou
Iouman,
DeleteThe problem with one-party rule was also portrayed during the Bush administration, yes? Even though your next-to-last sentence suggests 'a little, but not so much.' And didn't Congress and the Administration behave similarly Clinton's early years, under the aegis of 'We Have a Mandate!'?
I like the idea of a full and regular cleansing of the system - your last sentence.
Jean
I post this separately because it sums up the situation about as well as I've seen, and I think it worth repeating.
Delete"It's far to late for Obama to compromise and fix the divisions as that isn't his way of doing business. He is the master of divisiveness and alienation. A prime example is the wealthy. He has marginalized and dividing the country claiming they just do not pay their fair share. Top 10 percent pay 70% of Federal Income Tax. While the middle class, the median middle class family of 4 pay 5.6% after deductions of their income in Federal Income Tax. Nothing is said of this in the Media. The wealthy will pay more as Obamacare kicks in as they are being taxed their fair share to pay for the 30 million uninsured today. Yet Obama and his supporters want more. Then you have his chief lieutenants, Harry Reid and Nancy Pelosi. Harry has blocked all legislation in the last 2 years while the media has pounded the Republicans as do nothing. No attempt at compromise from Harry and his Democrats in the Senate. Nancy has now been marginalized with their defeat in 2010 however did her share in marginalizing the minority in the House. Both must go as well as Obama. Both Republican leaders must also go as they are as guilty as Reid and Pelosi, no attempt at compromise."
"The problem with one-party rule was also portrayed during the Bush administration, yes?"
DeleteYep!
Just for sake of discussion, http://taxfoundation.org/article/summary-latest-federal-individual-income-tax-data-0
DeleteTo hear that the top 10% per 70% of the taxes is a sensational number and it's thrown around quite a bit contrary to that authors claim. Something interesting to me is the way it breaks down within that group. First off, for sake of reference, that group of 10% that pays 70% of the taxes receives 43% of all the income. The bottom 50% who don't pay taxes earn 13% of the income.
Within the top 10% is very large split between those in the group between 1-5% and those in the 5-10%. Those in the group of 1-5% earn 31.7% of all the income, while those in the 5-10% range earn 11% of all income. So while a small percentage of those at the top do pay most of the taxes, they are also receiving a substantial portion of all the income. By including those in the 5-10% range, who make about a third of what those between 1-5% make, we get a nice big scary number and movement to pity the billionaire.
Whoever the author of you post was Jean, they make my point below. After painting Reid and Pelosi as evil personified, they throw a little tag at generically saying that they JUST as guilty as Reid and Pelosi at not attempting a compromise. If they are just as guilty, then that basically negates what they said about Reid and Pelosi.
Kinsgton, For what it's worth, I encourage you to read my bloviating and long winded post under the topic of "Charts of the day" that twinsdad recently posted. Your question to Lou was spot on, were things really so rosy four years ago that we want to go back to the Bush ere? Conveniently, many on the right will offer a token phrase of "both parties are responsible" but what you will never hear is a detailed description of how the party they support contributed to this, or how exactly they plan to fix it.
ReplyDeleteMy belief that I cling to is that we have a massive inequality in opportunity and income. I hope this isn't too long to discourage reading it. While I believe the inequality at this time is way too wide, I also acknowledge that you MUST have inequality to have a strong economy. If there is no inequality, there won't be satisfactory reward for working hard and taking risk. That said, I also believe that when the gap reaches the level it has right now, you create a situation wherein a majority of the wealth in the nation has become "dead money". Our large corporations are sitting on trillions of dollars in cash at home and abroad, they can borrow money for expansion at next to nothing and they tell us they simply can't take any risk because taxes might go up a couple of percentage points.
Something in that setup is ridiculous to me. I'll be entirely honest, I am asking for limits on how well we reward the risk takers. In my opinion, we have encouraged the wealthy in this country to absorb and hoard as much wealth as possible. Simultaneously, we have agreed to destroy private sector unions, we have agreed to keep shifting more and more cost of health care plans onto employees, we have agreed that it's okay for guys like Romney and hedge fund managers to make millions and pay only 15% tax, and worst of all, we have allowed our entire system of governance to become a body of wealthy members. If any percentage of members greater then 50% are wealthy, who do we honestly think they are going to advocate for?
I have said many times that building and sustaining a middle class is a political choice. Free markets distribute the lions share of gains to those who are the best at competing or coniving and taking advantage of those who are not quite so smart. In the years after WW II, we made the political choice to build that middle class, and the country thrived. Without a doubt, the top earners did not receive the type of compensation they do today. that said, they still did not live like the little people.
A nurse at my facility here came from Australia and told me about how much it cost her to go to school and what benefits she had just for being a tax paying member of society. She pays far less tax here, but nonetheless prefers the system she came from. Comparing conservatism in your country to our is not an apples to apples comparison. It's just something to keep in mind.