As the deadline to extend the Bush-era tax cuts looms, economists have agreed that the pending tax hikes would be devastating to the economy, and that permitting their expiration would have about twice the impact on economic growth as government spending cuts under the sequester.
Former U.S. Comptroller General of the United States David Walker just finished another tour across the country promoting “fiscal reform and responsibility,” according to Forrest Jones, writer for MoneyNews.com. And what he learned is that most people are frightened at the immensity of the fiscal and financial challenges facing the country, but almost no one has any confidence that things can be fixed.
U.S. unemployment slid from 8.1 percent to 7.8 percent in September, according to the Bureau of Labor Statistics (BLS), giving the Obama campaign ammunition to tout job growth right before the November election. But as soon as the numbers were released, critics asserted a slew of criticisms over the BLS report, claiming the numbers were cooked to favor the president’s plot for reelection.
Waiting for the economy to improve before turning off the printing presses is likely to take a very long time. The August numbers on the economy were disheartening for those waiting for such an improvement: U.S. durable goods production fell for the third month in a row, astonishing economists who had predicted much better numbers. GDP continues to slow, and companies such as Caterpillar, the world’s biggest construction and mining equipment manufacturer, cut its earnings outlook because of the continuing slowdown in the world economy.
A preview of the upcoming Census Bureau's upbeat analysis of the economy was met with little enthusiasm and contrasted sharply with reports from FedEx and elsewhere.
When the Federal Reserve announced last week its plan to buy more treasury securities, only a few read the fine print. Many observers envisioned sugar plums dancing in their heads as the Fed’s plan would lead, no doubt, to more economic growth, more jobs, more profits, and more stocks to sell on Wall Street. But in fact, unemployment not only hasn’t fallen significantly since the start of the Fed’s rollouts of Quantitative Easings, but it has remained higher longer than any time since the early 1980s.
If the Fed decides to extend its Operation Twist program beyond the end of the year and into the year 2015, then the math is irrefutable: 40 months of purchases totaling $85 billion a month is $3.4 trillion. The Fed’s balance sheet is currently at $2.7 trillion. That brings the Fed’s balance sheet, if nothing changes, to a mind-bending $6.1 trillion.
The U.S. tax code is a complex and burdensome maze of rates, exemptions, exclusions, credits, deductions, phase-out levels, and exceptions. People may not agree on anything else, but the nature of the tax code is certainly something that anyone of any political persuasion would agree on.
Everybody knew it was coming. With the economy continuing to founder, it was only a matter of time before Ben Bernanke and the Federal Reserve decided to turn once again — like the proverbial pig to its wallow — to printing money in a vain attempt to jolt the moribund American economy back to life. As with the first two such feckless efforts, they’re dressing this one in fancy verbiage — “quantitative easing” — that fools no one. This third round of quantitative easing — QE3 for short — announced Thursday and set in motion Friday, is just the digital equivalent of printing still more money, money that banks and other financials will either hoard in vaults or pour into equities, driving up stock prices but doing little to enliven the economy as a whole.
Keynesian policies allegedly designed (and sold to the American people) to stimulate the economy are actually having the perverse effect of stimulating government spending and putting off the inevitable day of reckoning when interest rates inevitably begin to rise.
The unintended consequence of low interest rates is the transfer of wealth from savers to the government.
Increasing gun sales are driving revenues and profits at Smith & Wesson and Sturm, Ruger & Company, thanks to Obama, "preppers" — and even "zombies."