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In other words, Greece consumers benefit from the euro the same way the German manufacturers do. The challenge of course is that Greece does not have as productive an economy, they have more tax evasion than they should and since their currency isn't dropping in value commensurate with their financial situation, they aren't able to boost tourism or the value of their exports.
The sad reality for Greece and the US is in the following paragraph:
The only real solutions are for Greece to restructure its debt -- both sovereign and private creditors should take haircuts; abandon the euro and reinstate the drachma; and rethink its welfare state.Continue Reading...
I hope those who believe in fiscal responsibility and hope to leave a better country to their children will join me in utilizing the new and infinitely accurate term "Krugman Death Spiral" when referring to any country which spends beyond its means and subsequently spirals downward.
Obama Death Spiral works as well - or Reid or Pelosi - your call really. Continue Reading...
He explains Obama’s populist rhetoric is carefully designed to hide the truth
This week I discussed why US politicians are more responsible for job losses than the iPad as some politicians would suggest. But today I thought it made great sense to explain what one of the most successful US businesspersons and employers has to say about the current political environment and moreover, how it is hurting US workers.Continue Reading...
In our experience when someone holds a view which cannot be defended with logic, personal attacks soon follow. Such is likely the case with Mr. Olbermann's latest endeavor.
America is slowly waking up to this political trick and its why I think this ad promoting Mitch Daniels for President is very effective. Not because I don't believe everyone in society doesn't deserve to have a great life - but because I believe individuals and corporations and a free market system with minimal government intrusion and regulation are the best path to helping the most people while keeping them motivated to be productive as the US competes in a global economy.
Rich Tehrani Continue Reading...
I am not a financial expert nor am I an economist – but considering they all have missed virtually every significant financial event from the dotcom bubble to the telecom bubble and the housing bubble let’s just say not being an economist or financial expert probably is a distinct advantage.
Having said this, I would like to discuss a few issues which need to be out in the open and discussed before the new Congress begins.
Bank runs are bad
Banks do not keep all of their assets in cash meaning if the majority of a bank’s customers decide to withdraw all of their money at the same time, the bank collapses. Think about it – they loan much of the money they have to others and don’t have access to it all. When one bank collapses there is a chance other investors will get spooked and create a cascade of bank failures. When not stopped, you have the potential for another Great Depression.
Bank runs are currently stoppable because governments can stop them
To date, bank runs have been stopped because governments around the world have been able to stop them by assuming the bad loans the banks have made.
Soon, global governments may not be able to stop the bank runs
With all the debt global governments have amassed, there is a possibility at some point that investors will start a global bank run meaning county after country will see their banks collapse because the confidence in the ability of a country to pay back its debt has plummeted.
Ireland may kick off a worldwide panic
If you follow financial news you may know much of Europe is in trouble because in general they work less hours than they should and produce far less than they need to in order to sustain the lifestyle they live. Continue Reading...
Consider that this month, 38% of the DC elites think the economy is headed in the right direction but only 26% of the general population believes this is the case.
The poll itself shows why the disconnect is taking place. We know that the Obama administration is responsible for the largest federal payroll in history so we would assume that government workers and those who feed off them are very happy. Moreover, the average government worker makes twice what the typical non-government worker makes. Continue Reading...