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11-27-2012 07:13 AM
I am already sick of writing about this fiscal cliff....
I don't have a lot of confidence that anything will get done. When given the chance to disappoint, politicians always do.
Gold and oil are pretty much unchanged.
Stocks are flat as well with the grains the best performer of the day. You have heard and read about me screaming from the hills but our only way out is GROWTH. We just don't see any growth anytime soon so that is why I am concerned. At our current rate of 1.5% to 2% GDP it will take forever. Something needs to happen and happen fast. We can't tax our way out and we can't cut our way out. We need both PLUS growth. All three need to happen to get us back on our track.
Don't hold your breath.
11-27-2012 08:16 AM
Scott, I don`t think there has ever been a mass denial on this scale. You have people that really believe that taxing those that make $250,000 a little more will solve all our problems, the math just doesn`t add up. We now have a healthcare act that is the law of the land, another entitlement at a time when all unsustainable entitlements have to be reformed. It`s like someone driving a car with no oil pressure that`s making a clunking noise and their method of repair is to turn the radio on louder to drown out the noise.
11-27-2012 08:50 AM
There is a solution to the fiscal cliff. It is call stupid. I mean being stupid. It has always amazed me in a country that talks of improving education, that accounting is not required to graduate from high school. But, since most of the voters have little to none in the way of accounting and business, it is easy to lead the stupid right off the cliff. That will be the solution.
Millions worry about a buck or two sale on Black Friday, but think 16 trillion and counting is not worth worrying about. The voters spoke, they voted for hand outs and 20 trillion.
Somehow the elected will raise the debt ceiling and come up with some deal that is a 'promise' to cut spending in the next decade and then will pat each other on the back for a good deal. The rich will be richer, cause it is easy to rob stupid. And the stupid, will believe it.
I mean the stupid believe there is a free ride.
What is really going to get interesting is a drought for another year on top of this. I can hear it now, it is all the farmers and ethanol's fault(doesn't matter milk is cheap and pork). Millions eat way more food each day than their bodies need, yet, high prices are the farmers fault.
So for you guys out there that have kids in school, if you just make your kid take accounting in high school he will already be way ahead of most.
Sometimes it is hard to take it all in. I mean, 16 trillion in debt and the best years ever in farming....just hope that light is not a train in the tunnel.
Scott, what do you think the odds are that there is no deal? If that happens, all bets are off.
11-27-2012 10:15 AM - edited 11-27-2012 10:16 AM
There will be another deal! Count on it. They will kick the can down the road another year. My opinion is they will get not only higher tax rate for over 250,000 but summer of next year,2013, they will have a battle over cap and trade and it will pass in one form or another(more taxes and revenue are the answer right) including carbon taxes which will pull in over a trillion dollars, all to the detriment of the real economy and deficit will not decrease by much and QE3.5,4,5,6 is coming.
Be careful to not lock in multiple years of grain sales without knowing what your expenses are.
11-27-2012 10:31 AM
16 trillion is not our biggest problem. The biggest problem is 86.3 trillion which is the amount of unfunded liabilities we're on the hook for with regards to SS and Medicare. If one really looks back, education has apparently been lacking for several decades. When SS was first implemented, the age to draw was actually higher than the average life expectancy which is why there were so many more people paying in per person drawing. Today, the age to draw is two decades less than the average life expectancy. Math skills and accounting waved by by to our gov't several decades ago.
Make no mistake about it, there will be a deal. It won't be any sort of reform. There will be another can kicking deal done before we fall over the cliff. Lockheed Martin announced massive layoffs over a month ago. Obama went to them and told them the gov't would pick up the tab if we went over the cliff as long as they kept those people employed. Even if we fall off the fiscal cliff, we still don't fall off the fiscal cliff as long as the gov't picks up the tab.
11-27-2012 11:34 AM
This article says this unfunded liability is GROWING by $8 trillion per year. If we taxed 100% of the adjusted gross income from individuals and business we would only collect $6.7 per year. We can't even fund the growth in our give aways!!!
11-27-2012 12:06 PM
It didn't become a ponzi scheme until the powers that be decided not to allow the age to draw to float accordingly with the average life expectancy. People shouln't even be drawing until they reach 72. I know a lot of people are for means testing, but by allowing means testing we turn both into completely socialist programs. If they'd dramatically increase the age to draw, a large amount of the unfunded liability would go down dramatically. As it stands now, all we're doing is adding nitrous boosters to the turbo to get more speed towards the cliff.
11-27-2012 12:33 PM
Lets not insure anyone that is liable to have a claim. Too many folk at age 70 drawing a check, lets make the retirement age 72.
Cutting benefits is your solution instead of raising taxes ( premiums) I wonder if Blue Cross considered that? No benefits until they are 72. Oh I know they have been paying in for decades but we just cannot afford that many claims. Raising premiums is simply not an option.