My Comment: From my previous posts on this blog, it’s clear I’m critical of the stimulus program. This article and many others articles on the subject point out the obvious, the expectations for job creation due to stimulus aren’t being met. This is a nice article from the AP.
By BRETT J. BLACKLEDGE and MATT APUZZO – 2 hours ago
WASHINGTON — An early progress report on President Barack Obama’s economic recovery plan overstates by thousands the number of jobs created or saved through the stimulus program, a mistake that White House officials promise will be corrected in future reports. Continue reading
My Comments: Merkel has been critical of central bank actions for some time. The independence of the Federal Reserve specifically is very suspect to me. Merkel was on the record saying “I view with great skepticism what authority the Fed has and the leeway the Bank of England has created for itself,” Merkel said in a speech in Berlin. “We have to return jointly to more independent central bank policies.” Stricter monetary policy isn’t politically acceptable, even when it’s the right thing to do. Merkel has called for tighter monetary policy (from foreign and the German central bank). Merkel apparently was awake on the day they taught about German’s inflation problems of the past.
Take a look at these two pretty good articles by Bloomberg and old faithful the Wall Street Journal.
“Government is not reason; it is not eloquent; it is force. Like fire, it is a dangerous servant and a fearful master.”
With a little more than 6 months left in the year, the Senate yesterday took a vote on permanently raising the FDIC limit to $250, 000. This piggybacks on a similar vote taken in the House doing the same. The measure will now be reconciled by committee and presented to President Obama for signature. Expectations are that this bill will be signed into law by the end of May. Investors have been looking for this clarity for some time and while we need to be cautious until this measure becomes law, it is close. There have been some questions raised related to a 2013 date – some are asking if this measure expires in 2013 and FDIC limits could go back to $100,000. The answer is “No”. The change is permanent. The 2013 date is referencing a 5 year date for the $250,000 limit to be reviewed for possible increase based on inflation. The 5 year period being referenced includes 2008 (original move to $250,000) through 2013.
Taxes on distilled spirits are among the highest taxes imposed on any product. Nearly 80 percent of what you pay for a bottle goes to the government in taxes rather than for the liquor. At an average price of $13.10 for a 750mL bottle of 80 proof spirits, this amounts to the government stirring in $10.43 to your total at the register.
The federal excise tax pours $2.14 into the average cost of a 750 ml bottle, or about 16 percent of the $13.10. Then the median state excise taxes add another $3.75 to the same bottle. And because distilled spirits producers must pay federal and state income taxes, federal payroll taxes, property taxes and other taxes, these costs are passed on to consumers. These taxes tack on another $4.53 to the total price of a bottle of distilled spirits.
President Barack Obama on Monday directed his cabinet secretaries to slice $100 million out of their departmental budgets–an amount equal to 0.007 percent of the deficit spending Obama plans to undertake in 2010.
My Comment: I’m sick of hearing about bank stress tests. It’s a joke and the Government has mismanaged this from the beginning. First the Government couldn’t decide if they were going to publish the results. Now, they say they will publish the results and that no bank will fail the test. So is this a case of participation alone gets you a gold star? The public and investors are supposed to feel good about a transparent “stress test” that no bank fails.
In my opinion, the results should not be published. The Government will have the ability to pick and choose which banks win and lose from the stress test, by publishing which banks are healthy than the others. Another potential problem is how much data is the Government going to release; just the score or a detailed report. If the release is skinny on details, I suspect investors will view this as a bad sign, because the government is trying to hide just how bad the results are.
Bank bailout plan’s ‘stress tests’ already causing stress