Growth….Really?
Stocks fell today, closing January at a loss, based on worries about our debt and economy.
Bonds, Gold went sideways.
The Dollar continued to gain against the Euro reaching $1.38/Euro.
Oil and gasoline continued their downward fall as the economy is questionable.
In the news today…….
5.7% GDP 4th Q – and this is good news??? Well, it should be; the number is just really big, n’est-ce pas? This reminds me of the 3Q GDP where it was first announced as 3.5%, and then revised to 2.7%, and then revised to 2.2%. I wonder what will happen with this number? It’s interesting that the first number makes the government look good. Well, the fact is that about 3/4 of the 4Q GDP increase was from an inventory buildup. So what? – I hear you say? Well, here is the so what! Inventories built up because they were depleted during 2009, and rebuilt in 4Q 2009. This was a one time event, and will go away in 2010. In fact, if there is weak demand for “stuff” this year, it will go away entirely as inventories are depleted again. That’s the so what!!! So, ignore that sound out there – it’s only the chest beating of the birdicus politicianus – or chest beating political lame duck.
$8B Railway Network – this is one of President Obama’s ideas for stimulating jobs. Sounds good in a speech – right? Well, let’s look behind the headline. The $8B project will just get studies done across the US. It won’t lay one foot of track, let alone any rolling stock. It will take another $100B+ to complete this project. Are you willing to spend the $8B on a project when you KNOW that you must spend another $100B+ to complete it? And, if you decide to stop the project, you can just throw that $8B expenditure away???? This is NOT full disclosure. This is NOT having a transparent government. This is pure deceit. Of course, this is better than building a “bridge to nowhere” or funding ACORN with Billions – but, come on now, let’s really build some infrastructure if we are going to spend some money. Where is the next Hoover Dam?
$5000 per worker hired – that’s the President’s new idea for job creation. He will offer small businesses $5000 per worker hired up to a maximum of $500,000 (that’s 100 new hired workers for those of you who don’t want to do the math). Sounds good on the surface – just like the previous article. But, think about this for a second. What is going to stop fraud from entering the picture here? Let’s say there’s a small business out there, and the boss hires 100 workers one day, and let’s them go the next day – does he qualify for the $500,000????? Or, maybe you just need to be a friend of Obama to get away with this one. Let’s say you are ACORN and you are going to hire census workers anyway – but now you can get another $500,000 for each 100 workers. You just hire them under the name of different small businesses. Great scam, I think. Of course, this is all speculation, and we must read the fine print (if there is any) before really coming to a conclusion. I just don’t trust these politicians. There has been much to much graft and payoffs to special interests for my liking.
Greek Bonds – have risen in interest rates due to the Greek Tragedy that’s happening because Greece can’t balance its budget. Greek 10 year national bonds have risen from 4.99% to 7.15% in 6 weeks. That’s over 2% rise. Enormous in any market. Could this happen in the US? Well, let’s think about this for a second. Greece is a unique situation – right? It is part of the EU, and it’s performance is dragging the Euro down with it. But, the key problem is that Greece’s budget deficit is 13% of GDP? Hum!!!!! Where is the US budget deficit? Just a teaser.
EU comes to Greek assistance – if the IMF doesn’t. Remember that Plan A was for Greece to use IMF aid as the US is the major source of funds in the IMF, whereas if the ECB (European Central Bank) comes to the rescue, it’s 100% European money. However, things have deteriorated so badly – see previous article on Greek interest rate rise – that the ECB couldn’t ignore the catastrophe. They are now Plan B.
Tonight’s Dinner Conversation…..
Climategate, aka “Cap and Trade”, has shown how unethical the scientific community can be in order to further a cause. The weather researchers at East Anglia University in the UK broke the law when they didn’t release emails and research about their “global warming conclusions.” But, they won’t be prosecuted because the offense occurred more than 6 months ago – as per UK law. Too bad, as far as I’m concerned. These scumbags should be sent to prison to entertain the real hard criminals.
Here is my main gripe. I was educated as an Engineer, and took way too many science classes. These classes drilled into me that finding the “truth” was the objective of research. Over the history of science, physicists and mathematicians sometimes found the truth, and sometimes found an approximation of the truth (think of Newton versus Einstein – both approximations of the “truth”). In no case, was it acceptable, encouraged, or glossed over in any way to fake the data, and draw pre-existing hypotheses into fact. However, some folks did that, and were drummed out of the community for it. It took years to resurrect some of the great scientists of the world when they went against the teachings of the church. It was considered blasphemous to do that. So, to see these scientific weather professors faking the data to prove “global warming” when it appears we are in a “global cooling” phase of the earth’s climate, is just dead wrong. However, if the “Cap and Trade” crowd rule the earth, then these fake scientists will probably stand right next to President Obama to receive their Nobel Prize. Let’s hope that the “truth” will come out, and everyone can then draw their own conclusions.
However, there is BIG MONEY behind this clouding of science. Cap and Trade is not worth Billions; it’s worth Trillions. Al Gore is making hundreds of millions of Dollars from this fake science; does that sound right to you? Perhaps the next President can tax Al Gore’s windfall profits as being “unethically created” and help pay back the US Taxpayers for their pain and suffering. Well, that was just cynical, as I was drawing a parallel to our President’s attack against the big 50 banks as being just as “unethical.”
Here are the last numbers for today:
Dow Jones 30 Industrial – 10,067 (down 53)
10 Year Treasury Bond – 3.61% (down 0.05%)
Euro – $1.3863 – down a full cent.
Gold – $1081 (down $3)
Oil – $72.70 (down $0.94)
Gasoline – $1.91 (down $0.01)