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As I sat and listened to the Idiot-in-Chief, I wondered if he actually believed what he said or just hopes to hell that we believe it.

He wants the tax cuts for the top one percent to be made permanent, but the ones he is outlining for the rest of America should only be a one-time deal.

Of course the following part really jacked my jaw: Folks at the extreme bottom of the economic rung shouldn’t get squat..because that is considered welfare.

Fark you Frat boy.

Here it is, what the Jackass-in-Chief wants and what lies and half-truths he spewed. Some lowlights:

The economic team reports that our economy has a solid foundation, but that there are areas of real concern. Our economy is still creating jobs, though at a reduced pace. Consumer spending is still growing, but the housing market is declining. Business investment and exports are still rising, but the cost of imported oil has increased.-Ok, the December report on how American’s spent their money showed it was in the toilet, the worst since 1991. The New York Times stated: Strong evidence is emerging that consumer spending, a bulwark against recession over the last year even as energy prices surged and the housing market sputtered, has begun to slow sharply at every level of the American economy, from the working class to the wealthy.

Sorry Bush, but your full of bat guano on that first point right out of the box. The way the government fixes it’s statistics on job growth have been crap for years. Too many variables that should be included in that statistic aren’t.

Wages are stagnant and good paying jobs disappear while the income of the top one percent of Americans that don’t actually work for a living and that love their stocks and hedge funds has continued to grow. To say we are growing and jobs are being created might be true..but what is the average wage of those ‘new’ jobs? The NYT article linked above shows how the lifestyles of average American’s has changed drastically:

One consequence is an upending of the traditional pattern, in which middle-aged children take in an elderly parent. As $15-an-hour factory jobs are replaced by $7- or $8-an-hour retail jobs, more men in their 30s and 40s are moving in with their parents or grandparents, said Cheryl Thiessen, the director of Jackson/Vinton Community Action, which runs medical, fuel and other aid programs in Jackson and Vinton Counties.

The Economic Policy Institute, EPI tells you and shows you graphs and charts on how wages have suffered for the working part of America:

With the release of today’s consumer price index for December—up 0.3% for the month and 4.1% for 2007—we can now examine how real hourly and weekly earnings did over the course of last year (comparing this December to last December).

As shown in Figure 1, both hourly and weekly earnings fell in 2007, a sharp reversal from the gains in 2006. After growing by about 2% in 2006, both hourly and weekly earnings fell, after adjusting for inflation, by about 1% last year.

More from The Shrub’s speechifying:Passing a new growth package is our most pressing economic priority. When that is done, Congress must turn to the most important economic priority for our country, and that’s making sure the tax relief that is now in place is not taken away. A source of uncertainty in our economy is that this tax relief is set to expire at the end of 2010. Unless Congress acts, the American people will face massive tax increases in less than three years. The marriage penalty will make a comeback; the child tax credit will be cut in half; the death tax will come back to life; and tax rates will go up on regular income, capital gains, and dividends. -Notice that he really wants to keep those on top of the foodchain safe, but not anyone else. God forbid their taxes go back up in the form of capital gains, dividends and the estate tax.

For the 99% of American’s that actually work for a living, their income isn’t growing like the income for the wealthy at the top of the economic food chain. From the latest data that is complete:

From 2003 to 2004, the average incomes of the bottom 99 percent of households grew by less than 3 percent, after adjusting for inflation. In contrast, the average incomes of the top one percent of households experienced a jump of more than 18 percent, after adjusting for inflation. (Census data show that real median income fell between 2003 and 2004. Average income is pulled up by gains at the top of the income spectrum; much of the 2.3 percent rise among the bottom 99 percent seems to largely reflects gains by households in the top decile of the income spectrum. In contrast, trends in median income capture the experience of households in the middle of the income spectrum.)

The top one percent of households (those with annual incomes above about $315,000 in 2004) garnered 53 percent of the income gains in 2004.(emphasis mine)

Sadly the reality is..it’s worse than that. The CBPP explained that the enormous gains at the top of the income foodchain caused a rise of income as a whole. But average income dropped between 2003 and 2004, and has not risen appreciably since then. In short, while the top one percent get richer, the middle class is shrinking, as economist Paul Krugman pointed out in a speech earlier this year:

By the time World War II was over, we had become the middle-class society that the baby boomers in this audience grew up in. We had become a much more equal society. That high degree of equality began to go away — depending on exactly which numbers you look at — during the late 70’s, maybe a little earlier than that. And at this point we’re basically back to pre-tax and transfer to the levels of inequality that we had in 1929.

What happened in 1929? The Stock Market crashed and burned.

The final blurb from our Frat Boy in the White House: In a vibrant economy, markets rise and decline. We cannot change that fundamental dynamic. As a matter of fact, eliminating risk altogether would also eliminate the innovation and productivity that drives the creation of jobs and wealth in America. Yet there are also times when swift and temporary actions can help ensure that inevitable market adjustments do not undermine the health of the broader economy. This is such a moment.

I don’t really want to call our Decider-in-Chief a delusional moron or better yet a lying sack of crap, but if that shoe fits… you hold him down and I will stick it on his foot, while I put the other one where the sun doesn’t shine, otherwise known as his behind.

We may not be officially in the throes of a recession, but there is sufficient data to understand why voters are focusing their attention on the economy. While economics is thought to be a function of mathematical equations, the evidence suggests that math is driven by consumer sentiment. As such, the math can rarely predict a recession. Instead, as is often the case, understanding a recession frequently happens well after the fact.

I’ve been amused to watch economists offer their odds on the U.S. slipping into a recession. For example, over the last several months…as the numbers have worsened, former Federal Reserve Chairman, Alan Greenspan, has revised his prediction a from one in three chance to a fifty-fifty likelihood we will see a recession. Greenspan isn’t alone in having altered his thinking…and I expect to see more of the same until such time as the math can capture the impact of rapidly expanding consumer pessimism.

Truth be told, December may well prove to have been the first month of a recession. In the constant barrage of numbers and statistics leading up to a recession, we occasionally receive data that captures the prevailing factors that are driving consumer doubts. Today, McClatchy News delivered a relevant snapshot.

WASHINGTON — New data from the Labor Department confirm what most middle-class Americans already know: Inflation is squeezing them.

As consumer inflation rose by 4.1 percent last year, the highest rate since 1990, the prices of basic essentials such as food, gasoline and health insurance climbed far more steeply, explaining why so many Americans are telling pollsters that the economy is their chief concern.

The Bureau of Labor Statistics reported Wednesday that the price of food and beverages rose 4.8 percent. At the same time, real weekly earnings failed to keep pace, rising 0.9 percent for the year. In the simplest of terms, a dollar earned bought less.

This partly explains why the economy so frustrates Americans.

“The kinds of things you purchase every day are going up (in price),” said Gus Faucher, the director of macroeconomics at forecaster Moody’s Economy.com in West Chester, Pa. “People who are at the lower end of the income scale are going to feel that more.”

That brings me to another point. If tax cuts are the be all and end all that the GOP suggests them to be, then why is it that they fail to insulate the middle class from a downturn in the economy? The obvious answer is that aside from being a symbolic gesture to most Americans, the tax cuts are simply a drop in the bucket. At the same time, the lion’s share of these tax cuts serve to further line the pockets of those who least need insulating from a faltering economy.

Perhaps the prevailing economic fallacy is the contention that further tax cuts will stimulate the economy. This might be true if the cuts were directed to those most in need of money to spend…the same middle class that pushed the economy into recession based upon their astute ability to recognize that their money buys less.

Instead, the GOP argues that their top-heavy tax cuts will eventually be transformed into investments and jobs. Unfortunately, that strategy fully ignores the fact that people in the middle class need more money; not more jobs. If those who already have jobs…have jobs that won’t allow them to keep apace with inflation…then what benefit will they see from the creation of new jobs…especially when most investors and large corporations are looking to create more lower paying jobs in order to produce more wealth. Even worse, globalization often means that these tax cuts are put into foreign investments that do not create jobs for Americans.

Until such time as economic policy is geared to produce meaningful benefit for the middle class, the economy will remain unstable and vulnerable, the handouts to the wealthy will further concentrate wealth in the hands of fewer individuals, and negative consumer sentiment will more frequently send the country into recession.

Lastly, the unprecedented subprime lending crisis…coupled with the inevitable decline in home values…has the potential to indefinitely stymie consumer optimism. Once the undermining of this last bastion of middle class wealth is realized, I would argue that all economic equations would have been rendered useless. If this happens, the backbone of the U.S. economy may be…like the fabled Humpty Dumpty…beyond reconstruction.

Cross-posted at Thought Theater

When the Bush administration first responded to concerns that the economy was on the verge of recession, they were quick to point to the stable unemployment figures and steady job growth. Well, as with most of what comes out of the Bush administration, the unfolding facts suggest their analysis may have been wrong…again.

The latest reports seem to support the concerns of numerous economists that a perfect storm may be materializing which could plummet the country into recession. The latest data on unemployment and job growth will undoubtedly put wind in the sails of those who believe the economy is tanking as well as force the Bush administration to once again shift their rhetoric.

First a look at the latest data.

From Bloomberg.com:

Jan. 4 (Bloomberg) — Hiring in the U.S. slowed more than forecast in December and unemployment jumped to a two-year high, raising the odds that the Federal Reserve will cut interest rates by half a point this month to ward off a recession.

Payrolls rose by 18,000, capping the worst year for job creation since 2003, the Labor Department said today in Washington. The jobless rate increased to 5 percent from 4.7 percent in November, while the Institute for Supply Management said growth in U.S. service industries cooled last month.

“This tells you that the strains from credit problems and so forth that have been developing the last six months are starting to bite and they’re biting in a way that now finally draws consumption into question,” said Neal Soss, chief economist at Credit Suisse Group Inc. in New York.

“It’s not a done deal, but if we’re going to have a recession, it’s too late to do anything about it,” said Stuart Schweitzer, global markets strategist at JPMorgan Wealth & Asset Management in New York. “The Fed can’t prevent a recession if one’s in the making, and we’re pretty close.”

The world’s largest economy grew at a 1 percent pace in the fourth quarter after expanding at a 4.9 percent rate the previous three months that was the strongest since 2003, according to the median estimate of economists surveyed last month. Growth for all 2008 was projected at 2.3 percent.

Keep in mind that a recession is defined as two consecutive quarters of negative growth…or a decline in GDP. The fact that the fourth quarter GDP barely remained in the black, coupled with the beliefs of many that the downturn (fueled largely by the sub-prime lending crisis and it’s impact on consumer confidence and spending) has yet to hit bottom, seems to suggest that negative growth is just beyond the horizon. While we’re not in a recession at the moment, one would be foolish to imagine any indicators of a strong economy in the short term.

Returning to the rhetoric of the Bush administration, it now appears that the powers that be have taken note of the tepid data…a fact that cannot be encouraging to a Republican party that needs every advantage it can find heading into the 2008 election cycle.

From The New York Times:

WASHINGTON — President Bush said Thursday that he was considering whether to propose a stimulus package to shore up the economy, the clearest indication yet of a growing concern inside the White House over rising oil prices, the subprime mortgage crisis and the possibility of recession.

“I’m concerned about people losing their homes and paying a lot for gasoline,” Mr. Bush said in an interview with Reuters.

Asked if he intended to do anything more to help people stay in their homes, the president volunteered the idea of an economic stimulus package, although he said he had not made up his mind and would probably not do so until sometime around his State of the Union address, which he delivers on Jan. 28.

“In terms of any stimulus package, we’re considering all options,” Mr. Bush said.

But it is a safe bet that tax cuts, long a centerpiece of the Bush domestic agenda, would be a feature of any administration initiative. And it is an equally safe bet that Democrats, who are contemplating their own economic stimulus package, would object, saying further tax cuts are unaffordable.

Mr. Bush has repeatedly said economic fundamentals are strong, a theme he is likely to echo Monday in Chicago when he delivers a speech on the economy. But with polls showing that the economy has eclipsed Iraq as the leading concern among voters, and with Democrats warning of a “Bush recession,” it has become increasingly apparent that inside the White House, there is a growing feeling that he cannot leave the economy to its own devices in his final year as president.

I’m of the opinion that the election year dynamic won’t help the President sell his party’s economic credentials or additional tax cuts. Truth be told, the Bush administration’s tax cuts have had little impact on the average American and the Bush apologist’s efforts to tout their success have never gained traction.

Add in the huge deficit, the doubling of the national debt, and the outsourcing of jobs under George Bush and it’s difficult to imagine voters trusting the GOP to solve what ails the economy. I suspect the Democrats will make the case that the President’s tax cuts were little more than a band-aid placed upon an economy in need of skillful stitching…and a handout to those already basking in the bounty of trickle-down tax strategies.

At some point, the voting public has to realize that perpetual tax cuts have little to do with sound economic policy and more to do with assuring that corporate America will fund the political aspirations of their GOP lapdogs. The next time a president dangles a tax treat, it needs to end up in the mouths of those who work hard each day to make ends meet; not in the bank accounts of a few fat cats who are salivating at the thought of another round of tax cuts.

Cross-posted at Thought Theater

Lots of people are losing their homes these days and everyone has a take on who’s at fault. Are home buyers feckless spendthrifts who took ill-advised dips into a shallow mortgage pool? Or, are Armani-suited lenders a bunch of loan sharks who prey on “the little guy”.

Um, yes.

Certainly home buyers share the blame. They ignored common sense signals that their loans were headed for disaster before the ink dried on the closing papers. Thousands who already struggled to pay credit card bills, car payments, and monthly rent fell for ads extolling the virtues of home ownership on the cheap. Bad credit? No credit? No problem! Buyers listened to shyster lenders dressed in cheap suits and pencil-thin mustaches tell them, “I’d give the money away, but my wife won’t let me.”

Word to the indebted - you don’t get somethin’ fer nothin’. That should have been your first clue.

Handing Keys to the Cat Burglars
It’s true that many laid-off folks simply had an unlucky run of bad luck that prevented them from paying the bills, but many more were rubes who handed the keys to their new houses to known cat-burglars.

(more…)

Years ago you actually had to qualify for a mortgage and you had better have more than zero down to get a mortgage. The mortgage industry is corrupt and the loans they are qualifying people for are a sham from the start. Federal mortgage insurance is letting them screw over the American people by telling someone that works part time that that person can qualify for a $180,000 mortgage with nothing down. Teaser rates and low entry mortgage payments is no better than stealing candy from every American Baby!

This issue has my blood boiling because my family and I were in fact victims of this crisis. Even though I work full time at a good job and at a decent wage, the wife works part time at a more than decent union wage, we lost our home to the criminals in the mortgage industry. We lost our credit, we lost our pride. We lost our home. Other extenuating circumstances contributed to our situation but the game plan was the same during a refinance of our existing home loan. I take full blame for my own financial stupidity and trusting the people that were supposed to help my family but in the end just buried us.

Over at the Houston Chronicle they have this to say about today’s government bailout created by the used car salesman of the housing industry…

House moves to help struggling homeowners
By MARCY GORDON
Associated Press
WASHINGTON — The House today approved a plan to expand federal backing of mortgages in hopes of helping struggling homeowners avoid foreclosure.The bill, which passed the House, 348-72, would allow the Federal Housing Administration, which insures mortgages for low- and middle-income borrowers, to back refinanced loans for tens of thousands of borrowers who are delinquent on payments because their mortgages are resetting to sharply higher rates from low initial “teaser” levels. The measure, which exceeds limits favored by the Bush administration, is Congress’ first stand-alone bill in response to the mortgage-market tumult of the summer, which came amid a rising tide of defaults and foreclosures. The Senate last week passed spending legislation that includes $200 million to provide aid to nonprofits and other groups that offer counseling and information to help homeowners avoid foreclosure.House Republicans sharply objected to a $300 million-a-year fund for grants for affordable rental housing and homeownership assistance for low-income families, which would be financed from FHA revenues — a plan also opposed by the Bush administration. But House Republicans mostly were swept along in the vote for the bill, whose overall thrust they endorsed in the face of the mortgage crisis.- Houston Chronicle

Even with the Fed cutting the interest rates one half point it is not going to fix the problems that were created over the last ten plus years by the mortgage brokers of America. All of the schemes and plans to access the lucrative market of housing lending have been played out and for the next three to five years the foreclosures will continue.

I’m sure you know of someone that you can’t believe that they qualified for a mortgage. Maybe a child, a brother or sister, your best friend and the list goes on. What qualified them for the loan was the closing costs that were paid to the people that wrote the loan and sold that same loan within weeks of the closing. Once the loan is sold it is no longer the brokers problem and the commissions made to close the loans are huge!

First they make the kill by luring people in search of the American dream and owning a home. “I can get you into this house and if we have to fudge the numbers a little to get it done, we do what we have to do.” All the potential home owner really heard was “I can get you the loan.” Having the keys to that house is the dream and in that dream comes the people out of the woodwork of that home to make more than a few thousand dollars per loan that they close.

With all the deals that they have they can qualify anyone for a loan and the result is what we are seeing everywhere across America. Bogus adjustable mortgages that reel you in to thinking that you can afford the house payment. No principal payment for X amount of years and the list goes on and on. Everyone qualifies! Or do they? Over at Newsvine.com they have this to say about it…

U.S. Home Foreclosures Soar in August
Tue Sep 18, 2007 6:13 AM EDT

LOS ANGELES — The number of foreclosure filings reported in the U.S. last month more than doubled versus August 2006 and jumped 36 percent from July, a trend that signals many homeowners are increasingly unable to make timely payments on their mortgages or sell their homes amid a national housing slump.

A total of 243,947 foreclosure filings were reported in August, up 115 percent from 113,300 in the same month a year ago, Irvine, Calif.-based RealtyTrac Inc. said Tuesday.

There were 179,599 foreclosure filings reported in July.

The filings include default notices, auction sale notices and bank repossessions. Some properties might have received more than one notice if the owners have multiple mortgages.

August’s total represents the highest number of foreclosure filings reported in a single month since the company began tracking monthly filings two years ago. - Newsvine.com

Getting to the point of my post… Who the hell is screaming for the heads of the Mortgage Corporation’s across America on Capitol Hill? Anyone home? Somebody should call an exterminator for the Congress because there seems to be an infestation of crickets when it comes to the lending industry. I wonder why? Democrat’s and Republican’s both own this mess one hundred and ten percent but the ones that really own this self created crisis is the lending industry. As they walk away from it laughing all the way to their own bank the Congress will spin this as a crisisproblem for the American family. In the end the American tax payer that still has a job and a home will pay for the thievery of gentleman and woman disguised as a mortgage broker in wolf’s clothing.

These predatory lending practices should have been stomped on by the government years ago but they chose to look the other way. Millions of Americans have already lost the American dream and millions more will follow in their footsteps because they never saw the used car salesman standing in front of their future home and dream.

Watch the political spin. It should be pointed at the lending industry but that will never happen because that would point to the people that are supposed to pass the laws to not let this sort of thing happen.

Papamoka

Cross posted at Papamoka Straight Talk