3/7/11…grumpy old men

Friday’s reaction to the much-heralded drop in the unemployment rate confirms the volatility of the stock market and from TB’s experience, when things begin to oscillate wildly, they soon get out of control. Take the spike on the open with unbridled exuberance which is what happens when one fails to read the numbers and focus on the headlines. Sure the number of new jobs was good (relatively speaking) at 192k and some are saying that it might have been 300,000 without the seasonal adjustment…or the drop to below 9% on unemployment…all well and good…but the participation rate continues to sink…how long can this go on before we realize we are in a jobless recovery…and with a Congress hell-bent on ending it while fighting for the political spoils. Bonds went lower than rallied on the equity markets grief…but not that much. Gold like stocks had an inside…almost parallel day, while Crude hit a new rally high. of $105.17/ Overnight, stocks are modestly higher, bonds are weaker (30 yr -½), Gold spiked new a new record high of $1447 and Crude is at $106.47 blowing off Friday’s high. It could get interesting.

…should we rename the GOP the Grumpy Old Party? The best TB can say for them as they all speak the same script. Even the words…”broke”, “labor unions”, “Obama’s running up the deficit.”  It’s as if they have  lexicon that they are bound to…are they now carrying that in their breast pocket next to or replacing the Constitution…although Boehner produced a copy once and it turned out to be the Declaration of Independence, but you get the point.

Meanwhile, the Dems hardly speak at all…maybe they can’t find a union printer to do their lexicon? But it is the mean-spiritedness of the whole thing that continues to trouble TB. Dammit this isn’t about cutting spending this is about holding a party together for two more years and when you are the GOP that is beholding to two factions, the tea baggers and the Christian right, that is no small task!

Back to that GOP lexicon…we have heard ‘we’re broke’ from Boehner, Cantor, and Sunday Mitch McConnell not only said it he said we are as broke as Greece! That should be an act of treason. He says no one will buy our debt and seems convincing the Chinese and others that only a fool would do so! Is this responsible? Not only that, it is a blatant untruth…far be it for TB to call those stalwart men liars.

According to Merriam Webster, ‘broke’ means (and the definition of it as an adverb is just one word): PENNILESS.

TB looked this up because to him that is what broke means…with no ability to get out of the hole. What kind of leaders would tell the American people there is no way out? Especially when we are not BROKE, although something has to be done to repair the damage inflicted on us by those same Grumpy Old Men (with apologies to the movie which was a comedy…this is no joke), the last time they were in control of the Congress. Even Newt Gingrich (now in an unsuccessful run to be President…way too much baggage and most self-inflicted like his divorce from his wife right after she had surgery for cancer), proclaimed he was disgusted with his party after his Contract With America set us on course to straighten the budget mess out.

But the GOM are so focused they forget that the biggest surge came under THEIR President and thankfully or we wouldn’t even be holding this conversation now because we would be sans a banking system! No, it is the spendthrift Obama (and as TB has said many times before he can find enough to criticize the man for without making things up or distorting facts. But this is war and aren’t all things fair in love and war?

You know how the GOP is so fond of saying “God bless the United States of America” after every speech and that forced the Dems to do the same…well we all better be saying it because we need it! But what the GOP is trying to do is to make cuts that don’t hurt their constituents (“anyone over 55 needn’t worry about their social security benefits being cut” – so much for shared sacrifice), and instead focus on cutting things that have been a thorn in their side…labor unions…NPR (although TB agrees there could be cuts based on some of the figures but that is the only honest reporting on the tube that is left…TB has been forced to listen to the BBC and Al Jazeera for the news…both of which are on…you guessed it…public broadcasting). Meanwhile, they secured in the Supreme Court in a 5-4 decision that corporations cannot me limited in their campaign contributions (the same court that in another 5-4 decision ruled that a religious group had the first amendment right to disturb a soldiers funeral…where was the GOP in defense of the soldiers on that one???).  The cuts they are proposing would be a joke due to their penny ante size were it not for the fact that they would cut funding to the IRS and as Paul Krugman said Friday…this is supposed to improve tax collections? If you support what the GOP is doing then don’t be surprised at the result, which will likely take us out of this piss ant recovery and back into recession by next year…sooner were it not for the 100% deduction this year of all capital expenditures by companies…but what about next year after they have spent it all?

Seal the deal: the GOP needs to recruit Meredith Whitney to write a report as  she did on municipal bonds to scare the widows and orphans into selling their treasuries while there is still time!

. . . – – – …

TB is now convinced more than ever that we are in class warfare and don’t know it…and of his prior statement that the haves are not even aware of the have nots strife.

He learned this by picking up this weeks Barron’s. There on the front page was  photo of an insert and new mag for Barron’s readers called “penta’ (short for pentagram???). The cover story of the new mag was “15 Best Places for Second Homes.” – second homes??? Most Americans are either struggling to hold on to their only home or trying to scrape enough to buy a first one. This makes “let them eat cake” almost sound like a sincere statement. Let’s look inside:

First, the editor of this new rag…er…mag is Phil Roosevelt…no doubt no relation to either of the former presidents. His opening comment is smug as a forty-something(?) can be: “If there’s anything better than a great second home, it’s a third one or a fourth.” You rock Phil, you pompous ass! He then goes on to tell us to be like John Lennon with multiple homes all over the world…never mind that the way air fares are going up most won’t even be able to reach them.

“The rich, to their own considerable surprise have emerged from the financial crisis with both their wallets and their dreams largely intact. Result: Folks are once again ready to reach for stunning vacation homes.”

…you can’t make stuff like this up! We are making the French nobility look like patron saints. The ads are ALL from money managers that cater to the wealthy, Wilmington Trust, BNY Mellon, etc.

As for the article on second homes, number one locale was Sea Island, Georgia where Roosevelt suggests you should run while the bargains are there. Median price 2010, $2.3 million same as 2009…see what he means? Of the others rounding up the ten, only Sun Valley showed a decline to $3.4 million from $4.6 million, two others were flat while the rest were up 100-200k. Count TB in! Two other articles were on Harry Winston and the demand for diamonds, and one on collecting tribal art at bargain prices…made easier due to rapidly rising food prices forcing people to sell their artifacts to survive.

TB thought it was in this but it had to be elsewhere…a story and ad for NetJets saying that when they are deadheading you can get amazing prices…like a family of seven or 8 can fly for less than $8,000 and not have to be hassled by the TSA.

Is this a great country or what??? Really, Mitch…we’re broke? Only the peons and the government, right?
Oh, and don’t you dare make those hedge fund operators pay more than 15% tax…after all that is their fair share.

Enjoy your week!

TB

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