It's been a while since I had any desire to update the blog. What more is there to say? The propaganda machine was so close to convincing the masses that things were better, then last week the stock market drops 10% in 3 minutes and Europe had to come up with a trillion dollar bailout to keep the world from ending.
I did think it would be appropriate to make note that in January I commented that there were 37 million Americans on food stamps. Great news, the USDA now says that as of February there were 39.68 million Americans on food stamps.
The U.S. Treasury also announced this week that the budget deficit in April was a record for the month of April at $83 billion. Individual Income tax collection was down 21.5% year over year. Yes, 21.5% from April of 2009. What a fantastic economic recovery we are experiencing.
Wednesday, May 12, 2010
Wednesday, March 17, 2010
Secret to Success
I forget the details of how I got the free subscriptions but somehow I received free subscriptions to Fortune and Forbes magazines. I preface what I'm going to share lest anyone think I would waste a penny on either of these rags.
So while skimming through Fortune I come across a one page gem, "My Best Advice for Growing Your Business" by Verne Harnish. Mr. Harnish is described as a consultant and creator of MIT's Birthing of Giants executive program. I know, I know do I even have to list the embarrassing, ridiculous advice that is going to come from someone who created a program called "Birthing of Giants"?
So what's the number one piece of advice the esteemed Mr. Harnish provides for those of you on the edge of your seat hoping to give birth to a giant...or is it be birthed by a giant, or is it to be birthed and become a giant...so many questions but I digress. Number one and I quote, "Get an Edge. Find an underlying advantage of 10 to 30 times over the competition to dominate your industry." No, I did not embellish this sage advice from the brilliant Mr. Harnish.
Now you know, simple as that, be at least 10 times better than your competition. This changes everything, I've got to go and start working on finding my underlying advantage that will make me at least 1000% better than my competition...what will I do with the rest of my day?
So while skimming through Fortune I come across a one page gem, "My Best Advice for Growing Your Business" by Verne Harnish. Mr. Harnish is described as a consultant and creator of MIT's Birthing of Giants executive program. I know, I know do I even have to list the embarrassing, ridiculous advice that is going to come from someone who created a program called "Birthing of Giants"?
So what's the number one piece of advice the esteemed Mr. Harnish provides for those of you on the edge of your seat hoping to give birth to a giant...or is it be birthed by a giant, or is it to be birthed and become a giant...so many questions but I digress. Number one and I quote, "Get an Edge. Find an underlying advantage of 10 to 30 times over the competition to dominate your industry." No, I did not embellish this sage advice from the brilliant Mr. Harnish.
Now you know, simple as that, be at least 10 times better than your competition. This changes everything, I've got to go and start working on finding my underlying advantage that will make me at least 1000% better than my competition...what will I do with the rest of my day?
Tuesday, March 16, 2010
Check it out
I ran across this website over the weekend, www.chrismartenson.com. I would highly recommend that everyone make time to watch the entire crash course that Chris has produced. He is no alarmist, provides no conspiracy theories, and is actually optimistic about the opportunities at hand. Personally, I am an alarmist, am 100% convinced that there are vast conspiracies at work to destroy the American middle class, and am decidedly pessimistic about the future of America and yet I ended up watching all 20 lessons Chris has put together and am much better for it.
Many of those that I speak with about the current reality of America and the world struggle to grasp the situation as they don't have a comprehensive frame of reference to draw on in considering the unique nature of what we are living through. These lessons will help provide a broader frame of reference.
Many of those that I speak with about the current reality of America and the world struggle to grasp the situation as they don't have a comprehensive frame of reference to draw on in considering the unique nature of what we are living through. These lessons will help provide a broader frame of reference.
Thursday, March 11, 2010
Great News!
It's been a while since I've posted anything. The lies continue, the charade continues, few people care at all, fewer yet have any ability to understand what's really going on.
But finally some great news. Forbes released the latest list of the world's billionaires yesterday and the news is exciting. The world now has 218 more billionaires than it did a year ago! Not only that, the average billionaire's net worth increased by $500 million in 2009. It warms your heart to know that while the middle class in America is being systematically destroyed the rich really are getting much, much richer.
Personally I love the fact that several of the world's billionaires now own my mortgage which they purchased for pennies on the dollar from the FDIC. George Soros, John Paulson, Christopher Flowers, and Michael Dell are owners of OneWest Bank which was formed to purchase the assets of IndyMac, my mortgage holder. Each one of them is a billionaire. They paid pennies on the dollar for my mortgage, and on top of that were extended loan loss guarantees from the FDIC that already have cost the U.S. taxpayers over $9 billion. I bring this up because it is a perfect snapshot of what is so despicable about what is happening in America. Had the FDIC offered me the same pricing on my home mortgage I would have simply wrote them a check and owned my home outright. Do they owe me this? Of course not. However, if they are going to sell loans at a huge discount to par value why should I, the debt holder, not have the same opportunity as a group of billionaires?
Of course that is said in jest, no serf deserves the same opportunity as one of the 1011 richest people in the world...that's just silly. By the way, OneWest made $1.6 billion in profits since inking their sweetheart deal with the FDIC.
But finally some great news. Forbes released the latest list of the world's billionaires yesterday and the news is exciting. The world now has 218 more billionaires than it did a year ago! Not only that, the average billionaire's net worth increased by $500 million in 2009. It warms your heart to know that while the middle class in America is being systematically destroyed the rich really are getting much, much richer.
Personally I love the fact that several of the world's billionaires now own my mortgage which they purchased for pennies on the dollar from the FDIC. George Soros, John Paulson, Christopher Flowers, and Michael Dell are owners of OneWest Bank which was formed to purchase the assets of IndyMac, my mortgage holder. Each one of them is a billionaire. They paid pennies on the dollar for my mortgage, and on top of that were extended loan loss guarantees from the FDIC that already have cost the U.S. taxpayers over $9 billion. I bring this up because it is a perfect snapshot of what is so despicable about what is happening in America. Had the FDIC offered me the same pricing on my home mortgage I would have simply wrote them a check and owned my home outright. Do they owe me this? Of course not. However, if they are going to sell loans at a huge discount to par value why should I, the debt holder, not have the same opportunity as a group of billionaires?
Of course that is said in jest, no serf deserves the same opportunity as one of the 1011 richest people in the world...that's just silly. By the way, OneWest made $1.6 billion in profits since inking their sweetheart deal with the FDIC.
Thursday, February 25, 2010
Snow Job
"Jobless Claims Rise on Snow-Related Layoffs"
This is not a joke, this is actually the headline on Yahoo Finance today to spin the "worse than expected" initial jobless claims. As a former business owner, I can fully attest that it is commonplace to lay people off when the weather is bad...not.
While it is commonplace for ignorant and lazy journalists to be "precisely inaccurate" to quote Nassim Taleb. I've noticed over the last several months that we have jumped the shark and these type of headlines and articles can no longer be attributed to stupidity, laziness, or hacks masquerading as journalists. The ministry of propaganda is in full swing trying it's best to keep the serfs from connecting the dots that things are not only not getting better, they are getting exponentially worse.
My question is this: are Americans buying this bs or is there a rage simmering under the surface that is ultimately going to explode? As I've never been good at suffering fools, those that I speak with regularly are bearish, so I personally know of no one who is buying the propaganda.
Are those that I interact with the minority with the sheep believing what they want to believe? Or, are we on the verge of social outrage that results in regeneration of our republic?
Would love to hear other's input/experience as to the social mood they find in their circle of influence.
This is not a joke, this is actually the headline on Yahoo Finance today to spin the "worse than expected" initial jobless claims. As a former business owner, I can fully attest that it is commonplace to lay people off when the weather is bad...not.
While it is commonplace for ignorant and lazy journalists to be "precisely inaccurate" to quote Nassim Taleb. I've noticed over the last several months that we have jumped the shark and these type of headlines and articles can no longer be attributed to stupidity, laziness, or hacks masquerading as journalists. The ministry of propaganda is in full swing trying it's best to keep the serfs from connecting the dots that things are not only not getting better, they are getting exponentially worse.
My question is this: are Americans buying this bs or is there a rage simmering under the surface that is ultimately going to explode? As I've never been good at suffering fools, those that I speak with regularly are bearish, so I personally know of no one who is buying the propaganda.
Are those that I interact with the minority with the sheep believing what they want to believe? Or, are we on the verge of social outrage that results in regeneration of our republic?
Would love to hear other's input/experience as to the social mood they find in their circle of influence.
Thursday, February 11, 2010
A New Credit Crisis Brewing
For some time I've been searching for a comprehensive account of how much carnage the Private Equity or Leverage Buy Out (LBO) "industry" has caused America. On occasion I would find an article identifying a particular instance where a company was destroyed after being purchased via a LBO but wanted to learn more.
I finally found the closest thing to what I was looking for in Josh Kosman's book, "The Buyout of America: How Private Equity Will Cause the Next Great Credit Crisis". While the writing and editing aren't the greatest, the gist of the book is both interesting and saddening.
For those who might not be familiar with how Private Equity/LBO firms operate I'll provide a simple 10,000 foot view. Basically these firms raise money from investors, primarily pension funds and other institutional investors, along with wealthy individuals. They use this money to effectively make a down payment to purchase existing, generally successful, businesses. They then saddle the company they are acquiring with massive debt to fund the lion's share of the purchase. They skim money for managing the process, initiating the buyout, overseeing operations and so on. The MO is to take over the company, do whatever it takes to increase earnings in the short term, including firing employees, reducing research and development expenses, lowering the quality of products produced, raising prices, etc. With a short term increase in earnings they will saddle the company with more debt. This debt will go directly to the LBO firm that initiated the transaction via a distribution or dividend. If they can sell the company to someone else (generally another LBO firm, the greater fool theory at its finest) great, if not who cares? As the partners risk nothing between raising investment funds and debt they still make money even when the company ends up in bankruptcy.
Now to cut to the chase. The loose money that has been unleashed on the market by central banks the world over for the past 10 years or so found it's way into LBO deals as one would expect. Currently there is approximately $1 trillion in debt owed by companies owned by LBO firms. The bulk of this debt will be due in 2011-2012. Nearly 3200 companies were purchased via LBO transactions between 2000-2008 in the U.S. These companies employ 7.5 million Americans. That's equivalent to 10% of the U.S. workforce.
Will this trillion dollars in debt be able to be rolled over in 2012? I have no crystal ball to speculate. However, it does shed light why the official policy of the fed and Barry O's administration is to attempt to reflate the bubble rather than let the deflation of it, that is natural, necessary, and arguably inevitable take place. Currently real unemployment is nearly 20% with more job losses to come. What will happen if these debts can't be rolled over? They certainly can't be paid off and the LBO shops that own these companies don't care if they go bankrupt.
To add insult to injury, both former president Bushes, former president Clinton, former House majority leader Dick Gephart, former Republican National Committee chairman Kenneth Mehlman, former Senate majority leader Tom Daschle, former Treasury Secretaries James Baker, Nicholas Brady, Paul O'Neil, and John Snow, (yes 4 former Treasury Secretaries) all have been or are currently on the payrolls of Private Equity firms. Both sides of the political establishment love the idea of destroying American companies and eliminating American jobs, as long as they continue to get rich in the process.
I finally found the closest thing to what I was looking for in Josh Kosman's book, "The Buyout of America: How Private Equity Will Cause the Next Great Credit Crisis". While the writing and editing aren't the greatest, the gist of the book is both interesting and saddening.
For those who might not be familiar with how Private Equity/LBO firms operate I'll provide a simple 10,000 foot view. Basically these firms raise money from investors, primarily pension funds and other institutional investors, along with wealthy individuals. They use this money to effectively make a down payment to purchase existing, generally successful, businesses. They then saddle the company they are acquiring with massive debt to fund the lion's share of the purchase. They skim money for managing the process, initiating the buyout, overseeing operations and so on. The MO is to take over the company, do whatever it takes to increase earnings in the short term, including firing employees, reducing research and development expenses, lowering the quality of products produced, raising prices, etc. With a short term increase in earnings they will saddle the company with more debt. This debt will go directly to the LBO firm that initiated the transaction via a distribution or dividend. If they can sell the company to someone else (generally another LBO firm, the greater fool theory at its finest) great, if not who cares? As the partners risk nothing between raising investment funds and debt they still make money even when the company ends up in bankruptcy.
Now to cut to the chase. The loose money that has been unleashed on the market by central banks the world over for the past 10 years or so found it's way into LBO deals as one would expect. Currently there is approximately $1 trillion in debt owed by companies owned by LBO firms. The bulk of this debt will be due in 2011-2012. Nearly 3200 companies were purchased via LBO transactions between 2000-2008 in the U.S. These companies employ 7.5 million Americans. That's equivalent to 10% of the U.S. workforce.
Will this trillion dollars in debt be able to be rolled over in 2012? I have no crystal ball to speculate. However, it does shed light why the official policy of the fed and Barry O's administration is to attempt to reflate the bubble rather than let the deflation of it, that is natural, necessary, and arguably inevitable take place. Currently real unemployment is nearly 20% with more job losses to come. What will happen if these debts can't be rolled over? They certainly can't be paid off and the LBO shops that own these companies don't care if they go bankrupt.
To add insult to injury, both former president Bushes, former president Clinton, former House majority leader Dick Gephart, former Republican National Committee chairman Kenneth Mehlman, former Senate majority leader Tom Daschle, former Treasury Secretaries James Baker, Nicholas Brady, Paul O'Neil, and John Snow, (yes 4 former Treasury Secretaries) all have been or are currently on the payrolls of Private Equity firms. Both sides of the political establishment love the idea of destroying American companies and eliminating American jobs, as long as they continue to get rich in the process.
Tuesday, February 9, 2010
Fictionalized Account of the Economic Crisis
In enjoying my lunch today I was lucky enough to catch Warren Buffet and Hank Paulson discussing Hank's fictionalized account of the raping of America that took place under his watch as Secretary of the Treasury. Before you ask yourself, "why does this guy keep ruining his lunch by catching these ridiculous acts of kabuki theater on the tube", trust me, you develop bad habits when you are unemployed...one of mine is having lunch while alternating between CNBC, Bloomberg, and Fox Business. Can't explain it other than morbid curiosity...but I digress.
So Grandpa Warren was asking questions to Hank and then agreeing at every turn how everyone involved saved the world. They would occasionally throw the peasants some bone like, "as terrible as this is now, if we hadn't acted in the manner we did our financial system would have collapsed.". Several things went through my mind as I suffered through the bs. First was, how disgusted I am that the state of America is such that when the aristocracy discusses how it stole from the middle class and future generations of middle class Americans to make sure that their own establishments were not seen to be insolvent, that a room full of idiots show up to listen and television crews broadcast it. There was a time when the aristocracy would be risking their lives if they tried to gather the citizens of America and tell them how stealing their wealth, and the wealth of their children and grandchildren was better than the alternative of the aristocrats casino being shut down. Now, with a straight face, they claim to have saved the world by making sure that their wealth was preserved at all costs.
It is this point that I suppose angers and frustrates me the most. People are so dumbed down, apathetic, naive, dimwitted, selfish, and morally bankrupt that they line up to get autographs from those who have robbed them blind and virtually insured the coming bankruptcy of America.
The other thought I did have was that when Hankies book is adapted to a movie about how he and the other aristocrats saved the world by selling out the middle class there will be a disclaimer run at the end of the movie. When you watch a Western you'll read a disclaimer that says something like, "No horses were injured in the making of this movie". Hankies book/movie will have to have the disclaimer, "No actual billionaires were harmed in the looting of America".
So Grandpa Warren was asking questions to Hank and then agreeing at every turn how everyone involved saved the world. They would occasionally throw the peasants some bone like, "as terrible as this is now, if we hadn't acted in the manner we did our financial system would have collapsed.". Several things went through my mind as I suffered through the bs. First was, how disgusted I am that the state of America is such that when the aristocracy discusses how it stole from the middle class and future generations of middle class Americans to make sure that their own establishments were not seen to be insolvent, that a room full of idiots show up to listen and television crews broadcast it. There was a time when the aristocracy would be risking their lives if they tried to gather the citizens of America and tell them how stealing their wealth, and the wealth of their children and grandchildren was better than the alternative of the aristocrats casino being shut down. Now, with a straight face, they claim to have saved the world by making sure that their wealth was preserved at all costs.
It is this point that I suppose angers and frustrates me the most. People are so dumbed down, apathetic, naive, dimwitted, selfish, and morally bankrupt that they line up to get autographs from those who have robbed them blind and virtually insured the coming bankruptcy of America.
The other thought I did have was that when Hankies book is adapted to a movie about how he and the other aristocrats saved the world by selling out the middle class there will be a disclaimer run at the end of the movie. When you watch a Western you'll read a disclaimer that says something like, "No horses were injured in the making of this movie". Hankies book/movie will have to have the disclaimer, "No actual billionaires were harmed in the looting of America".
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