The Ignorant Investor

Ignorance Can't Stand in the Way of My Opinion

Wednesday, October 20, 2010

 

Maybe I'm amazed

WASHINGTON – All signs point to huge Republican victories in two weeks, with the GOP now leading Democrats on virtually every measure in an Associated Press-GfK poll of people likely to vote in the first major elections of Barack Obama's presidency.

I don't know what exactly in the republican party platform is so attractive to voters. From Jan. 20, 2001 through Jan. 20, 2007 the republicans were in control in Washington. Seemed like a time of stupid decisions and wacky ideas ("Let's privatize social security and give the money to the financial services industry to run!" was about par for the course).

Friday, October 15, 2010

 

Talking to an empty room...

Blogging without readers is pretty stupid. I've been doing it off an on for years now and probably shouldn't bother. It beats arguing with people on public forums, though.

Thursday, October 14, 2010

 

Property Rights Are Only for the Wealthy

CNBC writer John Carney thinks its okay for a bank to foreclose on a homeowner even when the bank can't prove it owns a security interest in the house:

CitiMortgage modified D’Amelio’s mortgage but she defaulted anyway. Now she claims that Citi cannot foreclose upon her because Fannie Mae is the owner of her mortgage. Her lawyer argues that the mortgage was improperly assigned to Citi, and is contesting the foreclosure on those grounds.


Let’s grant D’Amelio not only the facts but also her interpretation of foreclosure law. Perhaps Citi, which purchased the mortgage in late 2006 and sold it to Fannie Mae in early 2007, shouldn’t be able to foreclose. Maybe the MERS system somehow vitiated any security interest attached to her house through the mortgage.


It's as though CNBC views the idea of title, property rights, proper legal procedure, as just these lame restrictions on a bank's right to do whatever it wants.

Monday, October 11, 2010

 
I was reading Methland the other day, and in one part of the book the author describes how a local meatpacking plant in rural Iowa was taken over by one of the huge agricultural giants. The unionized workers in the plant were making about $18 per hour before the takeover. Afterward, the company broke the union and and illegal immigrants came to take jobs at the plant at vastly reduced wages.

Now, how is one supposed to view this story in light of the immigration debate? When stuff like this happens, for some people it's very good. Food is cheaper for consumers, for example. Shareholders see gains in their ag company holdings. But for the workers it means a choice between leaving their homes to find work elsewhere, or sliding from the middle class into poverty. No real simple "good" versus "evil" sides there.

The housing construction boom, rising stock prices in 401Ks, cheaper HDTVs from China- this was all supposed to be the good stuff that came from policies that made low-wage labor a net positive for society. But it was a stupid plan and it didn't work.

 

Social Security Gets No COLA for a second year in a row

Angry old people expected to blame democrats and vote republican after a second year of not getting cost of living adjustments. The Federal Reserve isn't helping by keeping interest rates low, making sure elderly have to dip into savings to continue to eat. If they need more money, asks Federal Reserve Chairman Marie Antoinette, then why just don't they go back to work?

Friday, October 08, 2010

 

Our new economic theorycrafting

Bad jobs report. Local governments cutting positions as stimulus funds run out and austerity measures kick in. Private sector isn’t hiring because of over-capacity. The solution: Keep the Bush tax cuts! Then our free-market capitalists can use the money they don't have to send to the government to invest in making jobs for workers in China or India or Mexico, who will produce all the stuff our unemployed workers will buy here with their dwindling employment checks. If we impose more taxes on the wealthy, we know that the bureaucrats will take the money and spend it here on stuff like infrastructure or jobs programs (i.e., an inefficient use of low-cost capital that can be put to more profitable uses by investing it abroad and paying higher bonuses to corporate managers).

Note: This theorizing makes much more sense if you are a highly trained economist.

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