Here is a link to a Washington Post article describing one of the biggest if not the biggest problem with Obama's healthcare reform, the fact that it just costs too much. Our goal in healthcare reform should not be to expand health coverage, but to lower the cost of healthcare. As we lower the cost of healthcare, more people in turn then can afford it. It will do us no good to expand healthcare just to have healthcare cost continue to skyrocket.
http://tinyurl.com/nzmk4j
Friday, June 26, 2009
Monday, June 22, 2009
Obama's Debt Star
Remember the fear of the rebels when they heard about the Death Star and it’s potential effects on their everyday lives? It brought out of them the motivation and call to action. They did not sit ideally by as the Death Star was built, they moved and acted as soon as they knew about those plans. The reason being was that it would take time to build up a resistance and to gather the support they would eventually need in order to overcome the Empire. Well in a very real sense, we as citizens of this great country are facing a similar problem. We are faced with the very real effects of the massive spending that the current administration is proposing. Those pesky Congressional Budget Office members, why do they have to ruin all the fun with their inconvenient numbers concerning the national deficits. I don’t want to beat a dead horse here but let’s have a closer look at the numbers that they posted.
For all the talk we get about Bush’s deficit (which I’m not going argue the liberals against because it does make the Republicans kind of look like hypocrites) look at the comparison. We cannot become a welfare state. That is not the government’s role in our lives. Their job is to protect our rights and those that are granted to them SPECIFICALLY by the Constitution. It’s is not the government’s jobs to raise us from cradle to grave. The reason is precisely this, under our current form of government and that of the founding fathers, it’s unsustainable. We cannot afford it. It should not be the role of government to pander to a specific demographic, culture or people. The laws that are passed by government should be for the general welfare of the people.
We as citizens of this country need to realize the very real dangers of this type of spending in government and its real world consequences to us and our children. I hope you all will be proactive in your involvement with your local and national campaigns and movements to help bring about the conservative change we so badly need in our government.
Thursday, June 18, 2009
Senator Boxer rips into Brigadier General.
Here is one of the massive problems with government. Government officials who demand so much respect from those who should be receiving the respect from the government officials. He called her "Ma'am" which in the military is used to address those who hold a higher rank than you. He showed her the respect in the manner which officers show respect. "I've worked hard for this title..." So much arrogance stemming from one senator. My biggest beef with this is that he was using a title that showed the respect that she deserved. It's just wasn't worded the exact way she wanted it to be worded. Hmmm...doesn't this sound something like a king, queen or some other monarchical figure would say? Just saying. Click here for the link.
Monday, June 15, 2009
Press Release: ATTORNEY GENERAL MARK SHURTLEFF TO JOIN JOHN HUNTINGHOUSE FOR FUNDRAISER
MEDIA ADVISORY
FOR IMMEDIATE RELEASE
ATTORNEY GENERAL MARK SHURTLEFF TO JOIN JOHN HUNTINGHOUSE FOR FUNDRAISER
When: Saturday, June 20, 2009 from 5:00PM-7:00PM
Where: West Ridge Golf Course 5055 South Westridge Blvd. (5950 West) West Valley City, UT 84118
Contact: John Huntinghouse (John.Huntinghouse@imail.org) 801-231-2241
West Valley City – Utah Attorney General Mark Shurtleff will join John Huntinghouse, candidate for the Utah House of Representatives from the 33rd District, on Saturday, June 20, 2009 for a fundraiser event. The event will mark the kick-off to Mr. Huntinghouse’s bid to unseat 18-year incumbent, Neal B. Hendrickson (D-West Valley City). Speaking on the topic of his campaign, Mr. Huntinghouse said, “For 18 years Utah's 33rd district has been represented by a Democrat who has not made an effort to listen to his constituents and voice their concerns in the legislature. I am in this race to change that and to bring the true values of the 33rd district to the Utah House of Representatives.”
The event will run from 5:00 pm-7:00 pm in the banquet room of the West Ridge Golf Course. The public is invited to attend.
John Huntinghouse is a genetic researcher at LDS Hospital within the Cardiovascular Research Department and candidate for the Utah House of Representatives in 2010.
FOR IMMEDIATE RELEASE
ATTORNEY GENERAL MARK SHURTLEFF TO JOIN JOHN HUNTINGHOUSE FOR FUNDRAISER
When: Saturday, June 20, 2009 from 5:00PM-7:00PM
Where: West Ridge Golf Course 5055 South Westridge Blvd. (5950 West) West Valley City, UT 84118
Contact: John Huntinghouse (John.Huntinghouse@imail.org) 801-231-2241
West Valley City – Utah Attorney General Mark Shurtleff will join John Huntinghouse, candidate for the Utah House of Representatives from the 33rd District, on Saturday, June 20, 2009 for a fundraiser event. The event will mark the kick-off to Mr. Huntinghouse’s bid to unseat 18-year incumbent, Neal B. Hendrickson (D-West Valley City). Speaking on the topic of his campaign, Mr. Huntinghouse said, “For 18 years Utah's 33rd district has been represented by a Democrat who has not made an effort to listen to his constituents and voice their concerns in the legislature. I am in this race to change that and to bring the true values of the 33rd district to the Utah House of Representatives.”
The event will run from 5:00 pm-7:00 pm in the banquet room of the West Ridge Golf Course. The public is invited to attend.
John Huntinghouse is a genetic researcher at LDS Hospital within the Cardiovascular Research Department and candidate for the Utah House of Representatives in 2010.
Friday, June 12, 2009
Wednesday, June 10, 2009
Global Warming
I know I am preaching to the choir on this topic and that many don’t believe in global warming but I did want to try to state my opinion on the matter. What I love most about global warming is when you ask the average Joe what they know about global warming you get the standard answer something along the lines of “It’s the Earth getting warmer because of us.” Ok, whatever, if that’s what they believe then so be it. Then you follow up that question with "What is causing global warming?" Again, the average Joe will reply "Of course we know what is causing global warming, it's us with all the CO2 that we produce." However, heaven forbid you should ever ask a third follow up question to that such as "How do you know that CO2 is causing global warming?" or "Did you get your source from anywhere besides 'An Inconvenient Truth'?" It's like asking an Obama supporter what he really believes in. "Obama believes in change, and faith, and hope for change, and if he changes Washington, we'll have hope for the future because of change and faith and hope, which hope is placed in faith” and you know the line.
Everyone thinks that ALL scientists agree that global warming is man made. Actually here are the real stats done in a 2003 survey of 530 climate scientists in 27 countries, conducted by Dennis Bray and Hans von Storch at the GKSS Institute of Coastal Research in Germany. They found that
82 percent said global warming is happening, but only
56 percent said it’s mostly the result of human causes, and only
35 percent said models can accurately predict future climate conditions.
Only 27 percent believed “the current state of scientific knowledge is able to provide reasonable predictions of climate variability on time scales of 100 years.”
This is a far strectch from the "consensus" that everyone is talking about.
This is the main problem, everyone just assumes that the debate on global warming is over and the answer is that we are causing it by producing all this CO2. OK, first let me point out some of my feelings first on the subject. Do I believe the Earth is warming? I do (hesitantly due to recent data that suggest the past 10 years we are actually starting to cool.) but taken into context we are speaking about warming to the tone of a catastrophic increase of .7 degrees C over a 30 year span (not to mention the 30+ years prior to that that all the experts were predicting “Global Cooling” or another Ice Age.
Do I believe that we should try to find a solution to this problem? Yes and no. I do believe we should look into trying to find a solution to this as long as:
A. It is proven that this is a long-term trend
B. It is fixable
C. If it is man made and we do contribute a significant portion to it (which I believe we contribute to it to the tune of around 2% of the total greenhouse gases in the atmosphere).
D. That we are better off in a cooler planet than a warmer one.
Once all of the above premises are reached, I believe that fixing the problem of global warming should number one priority. However, until then I would advise caution from making rash economical, social, and environmental decisions based of supposed “trends” that we see.
Another item that should be noted is that both the temperatures of Venus and Mars have been rising over the same period of time in which the Earth has been warming. Don't just take my word for it, look it up yourself. Venus and Mars' average global temperature has been rising approximately (you have to take into consideration that Venus has a thicker atmosphere and Mars has thinner atmosphere than Earth's.) the same amount as the Earth's temperature. During this same time the activity level of the sun has dramatically increased too. Man if this whole global warming is caused by us, we are doing some serious damage not only our planet but to our whole solar system. Those Martians are going to be livid at us when they find out that we are the cause of their global warming.
One of the faults of the global warming scare is that global warming is a bad thing. It should be pretty evident that global warming might possibly be a good thing for us. Warming can raise ocean levels and lead to droughts. It can also extend growing seasons and increase rain. It all depends on where you are and what forecast you are using. The only common denominator is that most official warming reports, such as those from the UN, spend an inordinate amount of time discussing the negatives and very little time, if any, mentioning positive offsets. One of the reasons for this is that there is a culture in which every environmental activist has been steeped in for years — that man always ruins nature. That everything man does is bad. Growth is bad. Technology is bad. To be fair, its not that many environmental scientists are hiding the positive offsets, it’s that they have been programmed for years to be unable to recognize or acknowledge them.
Have you ever watched a local news station and listen to the meteorologist and hear their 7 day forecast? Why do they stop at 7 days? Why not do a 30 days or a 2 month forecast? The reason is mainly due to the fact that weather is almost impossible to predict that far out. For all the knowledge we have concerning climate change and weather patterns, the predictability of future climate change is almost near impossible. Take the case of global cooling. A lot of the younger generation were not a live during the 1960-70's where if you looked at the media then, it wasn't global warming that was the problem, it was global cooling. They were freaked out that we were heading into a global cooling. For example you have in 1978, the L.A. Times published an article that was titled "No End in Sight to 30-year Cooling Trend in the Northern Hemisphere," or Times Magazine article from 1974 title "Another Ice Age." Everything they were saying then can be said today just replace global warming with global cooling and switch the results. Why were they stating such prediction? It was due to the fact that they were inputting data from their recent history and extrapolating it further and further out without considering the fact that the trend of the previous 30 years could and would change. What is to say that this global warming trend doesn’t change? These climate models are made interesting by the inclusion of "positive feedbacks" (multiplier effects) so that a small temperature increment expected from increasing atmospheric carbon dioxide invokes large increases in water vapor, which seem to produce exponential rather than logarithmic temperature response in the models.
The biggest rebuttal to man made global warming is that in Al Gore's "An Inconvenient Truth" he showed this huge graph showing how CO2 levels were causing the temperature to increase. I must admit when I first saw this I was like, hmmm, pretty interesting. The funny thing is that notice that he didn't over lap the two data? The reason he didn't is because had he superimposed the temperature data with the CO2 levels you would have noticed temperature, drives CO2 levels, not the other way around. As the temperature of the Earth increases the CO2 levels then follows shortly thereafter. There is no evidence stating that the increase in CO2 levels drives the temperature.
If all this pollution was driving global warming you would expect that during the peak, during the industrial revolution, that temperatures would have sky rocketed. Funny thing is that the temperature of the Earth actually went down during that time. These are based of the graph and numbers produced by IPCC.
There are plenty of more data that viewpoints that support this position on global warming (I just don't want to make this into a 30 page senior thesis paper) but my whole point of this blog is show that the global warming debate is not over. More importantly is that if we are to try to fix this warming (assuming it continues to increase without ever cooling off, which is not all that plausible) you need to find the REAL source of global warming supported by sound scientific data.
Everyone thinks that ALL scientists agree that global warming is man made. Actually here are the real stats done in a 2003 survey of 530 climate scientists in 27 countries, conducted by Dennis Bray and Hans von Storch at the GKSS Institute of Coastal Research in Germany. They found that
82 percent said global warming is happening, but only
56 percent said it’s mostly the result of human causes, and only
35 percent said models can accurately predict future climate conditions.
Only 27 percent believed “the current state of scientific knowledge is able to provide reasonable predictions of climate variability on time scales of 100 years.”
This is a far strectch from the "consensus" that everyone is talking about.
This is the main problem, everyone just assumes that the debate on global warming is over and the answer is that we are causing it by producing all this CO2. OK, first let me point out some of my feelings first on the subject. Do I believe the Earth is warming? I do (hesitantly due to recent data that suggest the past 10 years we are actually starting to cool.) but taken into context we are speaking about warming to the tone of a catastrophic increase of .7 degrees C over a 30 year span (not to mention the 30+ years prior to that that all the experts were predicting “Global Cooling” or another Ice Age.
Do I believe that we should try to find a solution to this problem? Yes and no. I do believe we should look into trying to find a solution to this as long as:
A. It is proven that this is a long-term trend
B. It is fixable
C. If it is man made and we do contribute a significant portion to it (which I believe we contribute to it to the tune of around 2% of the total greenhouse gases in the atmosphere).
D. That we are better off in a cooler planet than a warmer one.
Once all of the above premises are reached, I believe that fixing the problem of global warming should number one priority. However, until then I would advise caution from making rash economical, social, and environmental decisions based of supposed “trends” that we see.
Another item that should be noted is that both the temperatures of Venus and Mars have been rising over the same period of time in which the Earth has been warming. Don't just take my word for it, look it up yourself. Venus and Mars' average global temperature has been rising approximately (you have to take into consideration that Venus has a thicker atmosphere and Mars has thinner atmosphere than Earth's.) the same amount as the Earth's temperature. During this same time the activity level of the sun has dramatically increased too. Man if this whole global warming is caused by us, we are doing some serious damage not only our planet but to our whole solar system. Those Martians are going to be livid at us when they find out that we are the cause of their global warming.
One of the faults of the global warming scare is that global warming is a bad thing. It should be pretty evident that global warming might possibly be a good thing for us. Warming can raise ocean levels and lead to droughts. It can also extend growing seasons and increase rain. It all depends on where you are and what forecast you are using. The only common denominator is that most official warming reports, such as those from the UN, spend an inordinate amount of time discussing the negatives and very little time, if any, mentioning positive offsets. One of the reasons for this is that there is a culture in which every environmental activist has been steeped in for years — that man always ruins nature. That everything man does is bad. Growth is bad. Technology is bad. To be fair, its not that many environmental scientists are hiding the positive offsets, it’s that they have been programmed for years to be unable to recognize or acknowledge them.
Have you ever watched a local news station and listen to the meteorologist and hear their 7 day forecast? Why do they stop at 7 days? Why not do a 30 days or a 2 month forecast? The reason is mainly due to the fact that weather is almost impossible to predict that far out. For all the knowledge we have concerning climate change and weather patterns, the predictability of future climate change is almost near impossible. Take the case of global cooling. A lot of the younger generation were not a live during the 1960-70's where if you looked at the media then, it wasn't global warming that was the problem, it was global cooling. They were freaked out that we were heading into a global cooling. For example you have in 1978, the L.A. Times published an article that was titled "No End in Sight to 30-year Cooling Trend in the Northern Hemisphere," or Times Magazine article from 1974 title "Another Ice Age." Everything they were saying then can be said today just replace global warming with global cooling and switch the results. Why were they stating such prediction? It was due to the fact that they were inputting data from their recent history and extrapolating it further and further out without considering the fact that the trend of the previous 30 years could and would change. What is to say that this global warming trend doesn’t change? These climate models are made interesting by the inclusion of "positive feedbacks" (multiplier effects) so that a small temperature increment expected from increasing atmospheric carbon dioxide invokes large increases in water vapor, which seem to produce exponential rather than logarithmic temperature response in the models.
The biggest rebuttal to man made global warming is that in Al Gore's "An Inconvenient Truth" he showed this huge graph showing how CO2 levels were causing the temperature to increase. I must admit when I first saw this I was like, hmmm, pretty interesting. The funny thing is that notice that he didn't over lap the two data? The reason he didn't is because had he superimposed the temperature data with the CO2 levels you would have noticed temperature, drives CO2 levels, not the other way around. As the temperature of the Earth increases the CO2 levels then follows shortly thereafter. There is no evidence stating that the increase in CO2 levels drives the temperature.
If all this pollution was driving global warming you would expect that during the peak, during the industrial revolution, that temperatures would have sky rocketed. Funny thing is that the temperature of the Earth actually went down during that time. These are based of the graph and numbers produced by IPCC.
There are plenty of more data that viewpoints that support this position on global warming (I just don't want to make this into a 30 page senior thesis paper) but my whole point of this blog is show that the global warming debate is not over. More importantly is that if we are to try to fix this warming (assuming it continues to increase without ever cooling off, which is not all that plausible) you need to find the REAL source of global warming supported by sound scientific data.
Friday, June 5, 2009
Liberals say the darndest things
Though President Bush is known quite famously for his misquotes and stupid remarks, his not the only one. Some funny liberal quotes for your viewing pleasure.
"He's been out in these countries for decades, building schools, building roads, building infrastructure, building day-care facilities,... and these people are extremely grateful." - Democratic Senator Patty Murray on Osama bin Laden
"I haven't committed a crime, what I have done is fail to comply with the law." - New York City Mayor David Dinkins reacting to accusations that he didn't pay his taxes
"Banning guns addresses a fundamental right of all Americans to feel safe." - Diane Feinstein, who carried a concealed weapon after claiming to be the target of a terrorist group.
"If the...if he...if is means is and never has been, that is not - that is one thing. If it means there is none, that was a completely true statement." - President Bill Clinton stumbling on the definition of the word "is"
"I've now been in 57 states -- I think one left to go." --at a campaign event in Beaverton, Oregon
"In case you missed it, this week, there was a tragedy in Kansas. Ten thousand people died -- an entire town destroyed." --on a Kansas tornado that killed 12 people
"Stand up, Chuck, let 'em see ya." –-Joe Biden, to Missouri state Sen. Chuck Graham, who is in a wheelchair, Columbia, Missouri, Sept. 12, 2008
"If crime went down one hundred percent, it would still be fifty times higher than it should be." -- Councilman John Bowman, Washington D.C.
"I will stand up and struggle, as others have, to try to get that right balance between violence, and sex, ... and things." - John Kerry on ABC News
"Those who died in the earthquake, their lives will never be the same again." - Barbara Boxer Senator from California
"I believe that gays and lesbians deserve to have the same rights as homosexuals." - Rev. Al Sharpton in 2002
"Outside of the killings, we have one of the lowest crime rates in the country." - Marion Barry, mayor of Washington, D.C.
"A zebra does not change its spots." - Al Gore, attacking President George Bush in 1992
"The police are not here to create disorder. They are here to preserve disorder." - Chicago Mayor Richard J. Daley during the infamous 1968 Democratic National Convention
"I was embarrassed to wear it." - Senator Diane Feinstein on wearing an American flag pin
"I'm not a chauvinist, obviously...I believe in women's rights for every woman but my own." - Chicago Mayor Harold Washington
"I have to confess that it's crossed my mind that you could not be a Republican and a Christian." - Hillary Clinton in a 1997 interview with the Richmond Times-Dispatch
"If the personal freedoms guaranteed by the Constitution inhibit the government's ability to govern the people, we should look to limit those guarantees." - Bill Clinton in an August 12, 1993 speech
"Yes, the president should resign. He has lied to the American people... and betrayed their trust."- The 12th Congressional District hopeful Bill Clinton during the Nixon Watergate investigations
"The last time I checked, the Constitution said, 'of the people, by the people and for the people.' That's what the Declaration of Independence says." - Bill Clinton quoting The Gettysburg Address during a 1996 campaign stop
"He's been out in these countries for decades, building schools, building roads, building infrastructure, building day-care facilities,... and these people are extremely grateful." - Democratic Senator Patty Murray on Osama bin Laden
"I haven't committed a crime, what I have done is fail to comply with the law." - New York City Mayor David Dinkins reacting to accusations that he didn't pay his taxes
"Banning guns addresses a fundamental right of all Americans to feel safe." - Diane Feinstein, who carried a concealed weapon after claiming to be the target of a terrorist group.
"If the...if he...if is means is and never has been, that is not - that is one thing. If it means there is none, that was a completely true statement." - President Bill Clinton stumbling on the definition of the word "is"
"I've now been in 57 states -- I think one left to go." --at a campaign event in Beaverton, Oregon
"In case you missed it, this week, there was a tragedy in Kansas. Ten thousand people died -- an entire town destroyed." --on a Kansas tornado that killed 12 people
"Stand up, Chuck, let 'em see ya." –-Joe Biden, to Missouri state Sen. Chuck Graham, who is in a wheelchair, Columbia, Missouri, Sept. 12, 2008
"If crime went down one hundred percent, it would still be fifty times higher than it should be." -- Councilman John Bowman, Washington D.C.
"I will stand up and struggle, as others have, to try to get that right balance between violence, and sex, ... and things." - John Kerry on ABC News
"Those who died in the earthquake, their lives will never be the same again." - Barbara Boxer Senator from California
"I believe that gays and lesbians deserve to have the same rights as homosexuals." - Rev. Al Sharpton in 2002
"Outside of the killings, we have one of the lowest crime rates in the country." - Marion Barry, mayor of Washington, D.C.
"A zebra does not change its spots." - Al Gore, attacking President George Bush in 1992
"The police are not here to create disorder. They are here to preserve disorder." - Chicago Mayor Richard J. Daley during the infamous 1968 Democratic National Convention
"I was embarrassed to wear it." - Senator Diane Feinstein on wearing an American flag pin
"I'm not a chauvinist, obviously...I believe in women's rights for every woman but my own." - Chicago Mayor Harold Washington
"I have to confess that it's crossed my mind that you could not be a Republican and a Christian." - Hillary Clinton in a 1997 interview with the Richmond Times-Dispatch
"If the personal freedoms guaranteed by the Constitution inhibit the government's ability to govern the people, we should look to limit those guarantees." - Bill Clinton in an August 12, 1993 speech
"Yes, the president should resign. He has lied to the American people... and betrayed their trust."- The 12th Congressional District hopeful Bill Clinton during the Nixon Watergate investigations
"The last time I checked, the Constitution said, 'of the people, by the people and for the people.' That's what the Declaration of Independence says." - Bill Clinton quoting The Gettysburg Address during a 1996 campaign stop
Thursday, June 4, 2009
Obama to the left of Chavez? Really?
Here is the article and link by Reuters
Reuters Article of Obama
CARACAS (Reuters) - Venezuela's President Hugo Chavez said on Tuesday that he and Cuban ally Fidel Castro risk being more conservative than U.S. President Barack Obama as Washington prepares to take control of General Motors Corp.
During one of Chavez's customary lectures on the "curse" of capitalism and the bonanzas of socialism, the Venezuelan leader made reference to GM's bankruptcy filing, which is expected to give the U.S. government a 60 percent stake in the 100-year-old former symbol of American might.
"Hey, Obama has just nationalized nothing more and nothing less than General Motors. Comrade Obama! Fidel, careful or we are going to end up to his right," Chavez joked on a live television broadcast.
During a decade in government, Chavez has nationalized most of Venezuela's key economic sectors, including multibillion dollar oil projects, often via joint ventures with the private sector that give the state a 60 percent controlling stake.
Obama has vowed to quickly sell off General Motors once the auto giant is back on its feet, but the government will initially control the company after a $30 billion injection of taxpayer funds.
Chavez, a vehement critic of the U.S. "empire," has toned down his rhetoric since Obama took office in January and the two men shook hands during a summit in Trinidad and Tobago in April.
(Reporting by Enrique Andres Pretel; Writing by Frank Jack Daniel, Editing by Jackie Frank)
Reuters Article of Obama
CARACAS (Reuters) - Venezuela's President Hugo Chavez said on Tuesday that he and Cuban ally Fidel Castro risk being more conservative than U.S. President Barack Obama as Washington prepares to take control of General Motors Corp.
During one of Chavez's customary lectures on the "curse" of capitalism and the bonanzas of socialism, the Venezuelan leader made reference to GM's bankruptcy filing, which is expected to give the U.S. government a 60 percent stake in the 100-year-old former symbol of American might.
"Hey, Obama has just nationalized nothing more and nothing less than General Motors. Comrade Obama! Fidel, careful or we are going to end up to his right," Chavez joked on a live television broadcast.
During a decade in government, Chavez has nationalized most of Venezuela's key economic sectors, including multibillion dollar oil projects, often via joint ventures with the private sector that give the state a 60 percent controlling stake.
Obama has vowed to quickly sell off General Motors once the auto giant is back on its feet, but the government will initially control the company after a $30 billion injection of taxpayer funds.
Chavez, a vehement critic of the U.S. "empire," has toned down his rhetoric since Obama took office in January and the two men shook hands during a summit in Trinidad and Tobago in April.
(Reporting by Enrique Andres Pretel; Writing by Frank Jack Daniel, Editing by Jackie Frank)
Tuesday, June 2, 2009
The problem with the bailouts..."Moral Hazard"
What is moral hazard? Moral hazard is the presumption that an individual or more specifically in this case businesses, will behave differently in a given financial situation if they are not fully exposed to the risks that are involved in their transactions. While everyone is panicking trying to avoid the supposed next "Great Depression", lawmakers foolishly dismissed the influences of this policy of bailing out businesses.
Let's reset the time clock and go back to last year. We have all heard the stories about Bear Stearns, Lehman Brothers, Freddy Mac and Fannie Mae. We will start off with Bear Stearns. Bear Stearns was a massive global investment bank and basically when it began to fail, the government panicked and pretty much did a shotgun marriage with JP Morgan Bank. Well here is the beginning of the moral hazard dilemma. As the economy started to reel into a recession, businesses started to depend on the government to bail them out. The Fed's policy of rescuing enormous businesses because they were too big to fail had caused this moral hazard of businesses upon businesses going to the government to help them out in their time of need.
Many people often ask why these massive banks and investment companies took so much risk, knowing full well that eventually the economy would have to correct for the massive growth. The answer is simple, it was due to the policy that the Fed has had for the past 30 years of bailing out companies that were deemed "too big to fail." Well if this were only the end of the story but as we see in government time after time, this is often not the case.
Following the Bear Stearns debacle Lehman Brothers, an even larger global investment bank that was even more intertwined to other companies, went to the government fully expecting a bailout. Secretary Paulson, knowing full well about moral hazard had said enough is enough. He refused to bail out Lehman Brothers and the stock market went haywire because of the expectation of a bailout for them. Had Secretary Paulson stuck to his guns with this policy of not bailing out businesses, we could very well be on our way to a faster and more efficient recovery even though we would have had to take some lumps on the way. Sadly, we will never know what could have been because when Freddie Mac and Fannie Mae had fallen to the verge of collapse, Secretary Paulson had gone back to the bailout mentality. Instead of sending a clear message of "WE WILL NOT BAIL YOU OUT" they essentially said, if you are a large enough company, we will do anything to save your company regardless of your incompetence with previous financial transactions. That set up a plethora of industries from the auto to the porn industries asking for a government bailout.
Now to our current situation. Most economist agree that within the next two years the economy will start to recover. There are some signs that the economy is recovering and the current administration will have you believe that the costs were worth it. Getting back to the subject of this blog, the problem is that the Fed's and Treasury Department's policies in the short term as to failing companies are unclear. There is nothing worse to an investor than ambiguity. One minute they are bailing out the auto industry, just to later let them fail (hmmm...probably should have just done this in the first place). Investors want stability and to know that the rules will not change on them after they invest into a company (look at the Chrysler's bankruptcy between the unions and bondholders). On top of this the long term policy of bailing out companies that are too large to fail is still in effect within the Fed. Look at the Saving and Loans Crisis that was dealt by essentially bailing many of the banks out, creating a moral hazard and acting as encouragement to lenders to make similar high risk loans which led us to our current subprime mortgage crisis. It may not be 3, 5 or 7 years from now but if not corrected, this policy of bailing out the financial industry and businesses of any kind for that matter, will yet again lead us to another recession/possible great depression in the future.
Let's reset the time clock and go back to last year. We have all heard the stories about Bear Stearns, Lehman Brothers, Freddy Mac and Fannie Mae. We will start off with Bear Stearns. Bear Stearns was a massive global investment bank and basically when it began to fail, the government panicked and pretty much did a shotgun marriage with JP Morgan Bank. Well here is the beginning of the moral hazard dilemma. As the economy started to reel into a recession, businesses started to depend on the government to bail them out. The Fed's policy of rescuing enormous businesses because they were too big to fail had caused this moral hazard of businesses upon businesses going to the government to help them out in their time of need.
Many people often ask why these massive banks and investment companies took so much risk, knowing full well that eventually the economy would have to correct for the massive growth. The answer is simple, it was due to the policy that the Fed has had for the past 30 years of bailing out companies that were deemed "too big to fail." Well if this were only the end of the story but as we see in government time after time, this is often not the case.
Following the Bear Stearns debacle Lehman Brothers, an even larger global investment bank that was even more intertwined to other companies, went to the government fully expecting a bailout. Secretary Paulson, knowing full well about moral hazard had said enough is enough. He refused to bail out Lehman Brothers and the stock market went haywire because of the expectation of a bailout for them. Had Secretary Paulson stuck to his guns with this policy of not bailing out businesses, we could very well be on our way to a faster and more efficient recovery even though we would have had to take some lumps on the way. Sadly, we will never know what could have been because when Freddie Mac and Fannie Mae had fallen to the verge of collapse, Secretary Paulson had gone back to the bailout mentality. Instead of sending a clear message of "WE WILL NOT BAIL YOU OUT" they essentially said, if you are a large enough company, we will do anything to save your company regardless of your incompetence with previous financial transactions. That set up a plethora of industries from the auto to the porn industries asking for a government bailout.
Now to our current situation. Most economist agree that within the next two years the economy will start to recover. There are some signs that the economy is recovering and the current administration will have you believe that the costs were worth it. Getting back to the subject of this blog, the problem is that the Fed's and Treasury Department's policies in the short term as to failing companies are unclear. There is nothing worse to an investor than ambiguity. One minute they are bailing out the auto industry, just to later let them fail (hmmm...probably should have just done this in the first place). Investors want stability and to know that the rules will not change on them after they invest into a company (look at the Chrysler's bankruptcy between the unions and bondholders). On top of this the long term policy of bailing out companies that are too large to fail is still in effect within the Fed. Look at the Saving and Loans Crisis that was dealt by essentially bailing many of the banks out, creating a moral hazard and acting as encouragement to lenders to make similar high risk loans which led us to our current subprime mortgage crisis. It may not be 3, 5 or 7 years from now but if not corrected, this policy of bailing out the financial industry and businesses of any kind for that matter, will yet again lead us to another recession/possible great depression in the future.
Monday, June 1, 2009
My Resume
Education:
University of Utah 08' Biology
Completed graduate work in Economics
Experience:
Currently genetic researcher at LDS Hospital within the Cardiovascular Research Department
Worked as a field director for Bill Dew's Congressional Campaign in 2008
Volunteered on the Mitt Romney Presidential Campaign in 2008
Volunteered on the Michael Renckert County Mayor's Race
Taught a Pre-Med Workshop class by the University of Utah
Over 5 years of experience in the Healthcare/Research field
Volunteered in the following capacities:
Tutored inmates at the Utah State Prison
Ronald McDonald House
Tutored English to foreign Korean citizens
Various church callings
University Hospital as a research assistant
Road Home creating pamphlets to inform others of the Road Home's mission
numerous service projects within the city and neighborhoods in West Valley City
University of Utah 08' Biology
Completed graduate work in Economics
Experience:
Currently genetic researcher at LDS Hospital within the Cardiovascular Research Department
Worked as a field director for Bill Dew's Congressional Campaign in 2008
Volunteered on the Mitt Romney Presidential Campaign in 2008
Volunteered on the Michael Renckert County Mayor's Race
Taught a Pre-Med Workshop class by the University of Utah
Over 5 years of experience in the Healthcare/Research field
Volunteered in the following capacities:
Tutored inmates at the Utah State Prison
Ronald McDonald House
Tutored English to foreign Korean citizens
Various church callings
University Hospital as a research assistant
Road Home creating pamphlets to inform others of the Road Home's mission
numerous service projects within the city and neighborhoods in West Valley City
Subscribe to:
Posts (Atom)
