Are we in Recession?

Technically the answer is no, however, practically, I don't think we ever came truly out of the last one.  I saw a headline today, it said "US economy shrinks 0.1 pct., 1st time in 3½ years" and it would seem that the economy is not tracking very well, at least last quarter.  Where will it go this quarter?  Are we headed into another recession?  Is the world coming to an end?  I wish that a poll would track the negatives like just mentioned.  Because, and this is crucial, economics is simply group psychology.  Nothing more, nothing less.

Looking back to the Great Depression of the 1930s, people were so negative that they were jumping out of windows.  One thing after another hit, like the stock crash, banking failure, and the dust bowl.  Farms were being repossess, and people lost jobs.  Even those who stayed employed were thinking that they were a day away from losing theirs.  How likely would it be for someone with that mentality to buy anything but necessities? Nothing government did seemed to make any difference, they even had to face it sober!  It took a World War to end it.

Because of the war and the destruction in Europe and Asia, the US experienced an unprecedented boom in the 50s and 60s as those continents rebuilt.  We didn't think ahead, and the new factories in those places out performed our aging facilities.  Transportation became cheaper, so goods could move easier all over the world.  The 1970s brought stagflation and recession.  Now it was our time to rebuild and retool.  That process is still going on.  If you notice, when Toyota or Hyundai, or Volkswagen open plants in the US, they are new buildings.  Even though there are a number of closed auto plants, they build modern facilities. 

Today, We the People are inundated with bad news on a 24 hour format through CNN, Fox, ABC, NBC, and CBS, along with print and web sources.  That bad news piles on to our already sinking feeling about the economy.  But what happened in the 4th quarter that caused the decline?

Could it be the election in November?  Or the fiscal cliff of December?  Or both?  Think about how you feel, add to it your neighbors, churches, and civic organizations.  Is it positive, neutral or negative?  Is that the reason?  I would contend that yes that is the reason.  Just less than 50% of voters were disappointed by the outcome of the election.  Both political parties were predicting doom and gloom if the other side won.  Is it any surprise it happened?

Our political leadership is lacking.  And I am not pointing the finger at one party, both are equally as guilty.  It is all about them.  How much they get to spend, and their lack of conscience to preserve the economy.  To have the deficits we have is appalling.  Our debt is staggering.  And they fight over what?  Making the rich pay their fair share (and I still don't know the definition of fair share), blaming law abiding citizens for gun violence, and debating whether we should allow 11 million illegal aliens to become citizens.  They fight over which government dole out is to be funded, rather than how can we stay within our means.



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I heard a gentleman say on radio that we can deficit spend at current levels indefinitely, oh really?  Don't try that at home!  Perhaps we can, if we are OK with inflation and economic stagnation.  I think we are better than that.  Why are there illegal aliens?  Because all people in our country are better off than most poor anywhere else in the world.  It is NOT the liberty we espouse.  It is not our system of government.  It is because of our success, they know that they can starve to death in their current country, or walk across the border and maybe not thrive, but they are certainly less likely to die.  We can't fix that, nor should we want to.  But we do need to enforce our laws and belief system within our borders.  Any one who wants to come should have a legal way to come.  Immigration made us great.  My great and great great grandparents were German and Irish, starvation in the potato famine drove the Irish side, and various economic reasons drove the German side.  Now we are Americans.  I feel no connection to Ireland or Germany.  But I love America!  We will survive and thrive.  But only when as a society we all agree to thrive.  That's economics...

The Man

I learned one, perhaps the one hero I had as a young boy, died.  Stan Musial.  Growing up in St. Louis in the 1950s and 60s meant hearing about Mr. Musial and his career and retirement from the Cards.  It was a simpler time.  Stan was St. Louis. 

The best memory for me as a boy was not on the field, it involved my grandmother.  She was in hospital, I don't remember why, when she saw Mr. Musial walking down the hall.  He was with two other men.  She called out to him and they entered her room.  She told him she had a grandson who would love his autograph. He agreed, but there was no paper.  She rang the nurse, who brought a prescription blank.  Once Mr. Musial signed, she turned to the second, she said, Mr. Schoendist, could you sign too?  He did.  She looked at the third man saying, I don't know you, but you should sign too.  Today I pulled out that paper, signed by Stan The Man, Red, and the general manager of The St. Louis Cardinals.

Reports say he died surrounded by family, isn't that marvelous?  Thank you Mr. Musial...

Read more here.

Economics and Guns

Strange topic, but that is what is in the news today, and not wanting to swim against the tide, it is today's blog.  Guns have over the last 237 years have consistently helped our economic system.  In multiple ways guns have added to our nation's ability to trade and earn.  Here's how.

In the early days of the republic, our Marines actually used guns to stop the pirates operating out of Libya, hence the lyrics ".. to the shores of Tripoli.."  Pirates are thieves on the seas, they earned their living off the backs of other people, stealing cargo and seizing ships.  The Marines put a stop to that with guns.

Even during the Revolutionary War it was private ownership of guns that helped form an army to liberate us from the tyrannical King George the 3rd of England.  It was his taxes and restrictions on the colonies that sowed the seeds of discontent, but without the guns in the hands of citizens, the Revolution would have been short lived.

Then came the War of 1812, without an armed populace, the British may have taken back our nation, putting us once again under the thumb of the British King.  The British finally learned the effect of an armed citizenry and since then our relations have improved.   Perhaps they are our best friends of the nations of the world.

Throughout the history of our nation, gun manufacturers have tried to improve the product.  It was a competitive thing.  They knew that better guns would sell better, but the off shoot was that our military also benefited.  This technology helped repel the Spanish, the French, keep the Japanese off our shores, settle the wilderness, and improve law enforcement.  All for the betterment of our society.

It is the gun manufacturers, primarily because of capacity, that helped win both World Wars.  And more importantly, private ownership of guns has kept tyranny from rearing its ugly head in our nation.  Unlike Germany pre-World War II when the Nazi's made gun ownership difficult at best and Hitler's regime came to power and almost destroyed Europe.

And yes, there has been evil done with weapons, guns included.  One of the most horrific mass killings in our history occurred when a disgruntled employee in Bath Township Michigan planted dynamite and blew up a school, killing 38 kids, six adults and injured 58 others.  That was deadlier than the recent Newtown incident.  And at about the same time as the Newtown crime, in China, where gun ownership is non existent, a knife yielding psychopath hacked up close to 25 students at a Chinese school.  And consider the death toll of tyrants like Hitler, Stalin, Pol Pot, the Sandinista, the Castro Brothers, and others in just the last century.  Or the terrorists currently coming from the Middle East, with illegal weapons.  The 9/11 terrorists did not use guns, they used air planes.

In the present, gun manufacturers employ many people, so do ammunition makers.  Retailers employ people to sell guns.  Government employs people to do background checks, and on and on.  Australia had a mandatory gun buy back program starting in 1996.  The next year murders and violent crime sky rocketed.  The Soviet Union banned guns, and more Soviet citizens, mostly Jews, died than during the Holocaust.  Tyranny kills.

So while the gun industry is important to us in an economic sense, they also give us the means to protect our liberty.  And that is the spirit of the Second Amendment.  And Liberty is what has made the USA's economic engine the greatest since the beginning of time.  I do not own a gun, my son does.  I do know how to shoot because of an NRA clinic when I was very young.  And I was a pretty good shot. 

There may come a time in this world when the people of all nations will be at peace, I pray.  But that time is not now.  And we, as a nation, need to be prepared for the worse case.  There are bad things that happen, but eliminating guns will not cure evil, it will only embolden it.  And it will put us in economic and libertarian jeopardy.

Support Liberty as if your economic life depends on it!

A Few Thoughts

There were so many things going on over the last week or so.  The 'fiscal cliff' made all the news, and even I talked of it on a number of blogs.  And it is worth noting that nothing was solved in the plan voted on by the Senate, The House of Representatives, and signed by the President.  Already there is talk of raising the debt limit.  Isn't that what we were led to believe they were trying to avoid?  So just wait, over the next couple of months, the Congress will say we need spending cuts, the President will say we need more stimulus, and the Senate will do nothing.

It is time for the thoughts... Recently, I received a letter in the mail from my health insurance company, it is a big one, but for now let it be nameless.  Now keep in mind, I have had this policy for just about a year.  In that time I have not used one cent of the insurance.  It costs $268 a month.  For those that didn't just do the math that's over $3200 per year.  That $3200 went to the company to pay others bills, as again, I had none.  Or perhaps it just went to the bottom line, who really knows.  But back to the letter, it informed me that if I wished to continue with this policy (a high deductible HSA account) it would cost me $281 per month for the coming year.  I am in good health overall, and I wonder why it is going up.  In fact, don't other companies offer discounts if you go claim free?  Should I not actually have to pay less?  There is a reason it is going up, Obama Health Care.  There are numerous taxes imposed on things like medical devices.  While I am healthy, the insurance companies costs are going up to cover these taxes.  And guess what, most of your costs are going up too, kind of wipes out any raise you received huh.  That and other tax increases will easily swallow any gains we may have made for the new year. 

The second thought revolves around the acquisition of Current TV by Al Jazeera.  Now you may or not know who is a minority owner of Current TV, former VP Al Gore.  Most of the coverage I have seen is touting how Mr. Gore, an extreme environmentalist, is selling to a media company built with oil dollars.  I even saw a report that Glenn Beck tried to purchase the network.  However, to me the biggest thing about this is the timing.  It seems Current wanted to complete the transaction by the end of last year... Is this a definition that new tax policies are not fair?  Mr. Gore wants to pay lower capital gains tax on his investment, and that is not a bad thing.  But Mr. Gore's party is the one saying the 'rich' like Mr. Gore are not paying their fair share.  Is this not hypocritical?  So I would urge Mr. Gore to man up, pay your fair share!  I know you don't have to, but think of the example you can set for us in the middle.  Or will it be more "do as I say, not as I do", we will see.

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So with the political economic fights brewing, the trickle down income grab from Washington, or lack of leadership on what is fair, 2013 is started off with a bang!  Happy New year! 

Spend Wisely!

Update:  We beat the NY Times!  They had a story about Health Insurance rates.  See their story here: NY Times and Helth Insurance.