Real Incomes Have Been Essentially Flat For 6 Years

Obama Raises Federal Pay $11 Billion Over 10 Years On Eve Of Fiscal Cliff

Now you know why Obama cut his vacation short . . . to raise spending! And rub our noses in it!

This guy is the biggest jerk ever to sit in the Oval Office, maybe excepting Lyndon Baines Johnson who reportedly pissed on the shoes of a soldier who dutifully stood at attention.

If ever anyone needed evidence that El Presidente couldn't care less about the consequences of federal spending for the fiscal situation, this is it. He's "in your face" about it, on the very eve of the biggest tax increase on the American people in living memory, and Republicans still take this guy seriously.

As reported here:

CBO [The Congressional Budget Office] says the (discretionary) cost of the .5% pay-hike the President is calling for in the Exec Order – relative to a freeze – is about $500m in FY 2013 and $11 billion over the ten years from FY 13 - FY 22.  The reason why the FY ’13 savings is only $500 million is because the pay hike as proposed by the President’s Exec Order would not go into effect until April 1st, 2013 - when the current CR [Continuing Resolution] expires. So it only covers half the fiscal year. The annualized cost of the pay hike is about $1 billion/year."

If Republicans had any imagination, they'd shut the damn government down . . . for the next two years, and teach Obama what it's like to run something. Teh.

That would save about $2 trillion of the taxpayers' money as government makes do with current revenues. The sound of the squealing pigs would be worth it.

At 2% Inflation/Year, It Takes Just 35 Years To Devalue The Dollar 50%

The rule of 72.

Consumer Prices Up 8.4% Under Four Years Of Obama

The Consumer Price Index is up 8.4% under four years of Obama (November 2008 to November 2012).

Similarly measured, the CPI rose 10.05% in the first term of George W. Bush, 11.15% in the second term.

The worst record in the post-war period was Carter's four years when CPI rose over 47%. In Eisenhower's first term CPI rose just 3.07%.

Measured from April 1973 (after the world went to a floating exchange rate system of currencies in the wake of the end of the gold standard in August 1971) to April 1999, 26 years, CPI raged 280% (a factor of 10.8 per year).

From April 1947 to April 1973 (CPI data not available before 1947), CPI rose a comparatively more modest 99% over 26 years (a factor of 3.8 per year).

For the 13 years since 1999, April to April, CPI has risen just 38% (a factor of 2.9 per year).

A composite of measures for the consumer bundle going back to the year 1900 at measuringworth.com here provides an interesting tool for comparison purposes.

While the dollar suffered a 446% decline for the 73 years between 1900 and 1973, a factor of 6.1 per year, in the 38 years between 1973 and 2011 the 406% decline is a factor of 10.7 per year, 75% worse per year since moving to a floating exchange rate currency system.

Viewed more broadly from the point of view of gold, from 1932 (the year of FDR's election and before his massive 69% devaluation of the gold-linked dollar in the spring of 1933) to the present day, the devaluation of the dollar has been in excess of 1500%.

From 1790 to 1932 the dollar declined just 54%.

At this hour, gold is $1,656.80 the ounce, $1,636.13 the ounce higher than it was in 1932, the last year of its fixed price at $20.67 the ounce, just another way of expressing the devaluation of the dollar.

Libertarian "Principle" Means Republican Defeat!

Good results for libertarians = Democrat victories!

See for yourself, here.

Democrats Funded Libertarian In MT Senate Race As They Did In AZ For Rep. Giffords

The m/o in AZ in 2010 was Democrats spending money to portray a libertarian as the true conservative in order to bleed-off votes from the Republican candidate and Iraq War veteran Jesse Kelly and thus re-elect the Democrat, Rep. Gabby Giffords, who went on to get shot by a lunatic with libertarian ideas named Jared Loughner. To add insult to injury, liberals nationwide then went on to blame her shooting on Republicans and the Tea Party.

I reported on this in early January 2011, here, showing a mailer for the libertarian paid for by the Arizona Democrat Party.

Now it turns out the same strategy was used in Montana in 2012 to boost the libertarian candidate as the real conservative, funded by liberal money, in order to bleed-off votes from the Republican Rehberg and re-elect the Democrat Senator Tester.

Propublica has the in-depth story, here.

Everyone thinks the Republicans are the stupid party when in two recent elections it's the libertarians who got played for fools and tools. But the Republicans really are the stupid ones for thinking an alliance with libertarians isn't just possible but natural when far more often than not libertarians view themselves as successful when they prevent Republicans from getting elected, as they themselves say here (h/t Chris).

We know whose side they are on. Libertarians are natural liberals, not conservatives.

The Full-Time Jobs Depression: 6.2 Million, 5.1%, Off 2007 High

Full-time jobs hit their all-time high in November 2007 at 121.9 million. Five years later they are at 115.7 million. That's down 6.2 million full-time jobs, or 5.1%.

And US population has grown 13 million over the five year period.

Figures through 11-01-12.

Chart and data here.

US Bond Market Debt Climbs To $37.7 Trillion In Q3 2012

According to sifma.org, here.

Just Under 47% (!) Of Households Own Stocks

As reported here:


The percentage of households owning stock mutual funds has also fallen, dropping every year since 2008 to 46.4 percent in 2011, the second-lowest since 1997, according to the latest ICI [Investment Company Institute] annual mutual fund survey.

Hm.

Investors "All In" 10/1/07 To 10/1/12 Are Down 1.19% Per Year

Investors who have remained "all in" the Standard and Poor's 500 Index for the last five years from October 2007 to October 2012 are still down 1.19% per year in real terms, with dividends fully reinvested.

If you've been taking your dividends, say as a retiree, you are down 3.35% per year.

This is pretty grim news when you consider that one school of thought for a conservative retirement drawdown from a portfolio is $40,000 a year, a 4% rate on a $1 million.

If you have been "all in" the SP500 with that sum, which you probably shouldn't be but let's say you are, it is throwing off just about $21,000 in dividend income right now (a little over 2%), so you've got to make up the difference from capital which over the last five years is already posting a 3.35% loss per year. So on top of that 3.35% loss you are taking another 2% per year from the seed corn to make up the difference, meaning your drawdown rate has been really more like 5.35% per annum.

This means that over the last five years such a $1 million retirement portfolio has been plundered by market vicissitudes and the retiree's human necessity by about $268,000. Nothing lasts forever, especially at that rate.

Chart and data here.

New York Magazine Spells Just Fine. Real Clear Markets? Not So Much.

What If Most Of What You Buy Made In China Is Made By Slave Labor?

"If you occasionally buy this product, please kindly resend this letter to the World Human Right Organization. Thousands people here who are under the persicution of the Chinese Communist Party Government will thank and remember you forever."

"People who work here have to work 15 hours a day without Saturday, Sunday break and any holidays. Otherwise, they will suffer torturement, beat and rude remark. Nearly no payment (10 yuan/1 month [$1.61])."

"People who work here, suffer punishment 1-3 years averagely, but without Court Sentence (unlaw punishment). Many of them are Falun Gong practitioners, who are totally innocent people only because they have different believe to CCPG. They often suffer more punishment than others."

-- From a letter written by someone from Unit 8, Dept. 2, Masanjia Labor Camp, Shenyang, China, found by an American in a Halloween toy.

Story here.

Libertarian Spoils Race For Republican In NH-1, Bringing Back Shea-Porter

Here's another race in 2012 which the libertarians helped throw to the Democrats. Democrat Rep. Carol Shea-Porter, defeated in 2010 by a Republican, regained her seat thanks in part to a libertarian in the race in 2012 who bled enough votes from the Republican to put her back in the seat.

The case was nearly the same in NH-2 where the Democrat faced a Republican and a libertarian but won in her own right.

Libertarians view themselves as successful, as having an impact, when they deprive Republicans of their victories. Libertarians suffer from a kind of bipolar disorder which is distinguished by a predominating social liberalism which trumps their economic conservatism and thus manifests itself politically as alliance with Democrats, which is what they really are, if only they went to therapy.

We know whose side the libertarians are on, and it isn't ours.

Follow the label in the footer to see other races libertarians helped spoil for Republicans in 2012.

Republicans need to grow a quatrain and start attacking not just Democrats, but libertarians as well.

Journalists' Guide To Firearms Identification

h/t Scott

The Greatest Economic Boom Of Our Time Coincided With The Cheapest Gasoline

Arguably the greatest economic boom period of the 20th Century, the period between 1986 and 2000, was fueled, quite literally, by the cheapest gasoline prices on an inflation-adjusted basis since the end of The Great War. Real gas prices during those years in today's dollars ran down from $2.00 a gallon in the mid 1980s to $1.50 by the late 1990s and up again.

Chart and discussion, here.

Say what you will about former Speaker of the House Newt Gingrich's presidential run in 2011-2012, he's the only public figure who has had the vision to understand the imperative of getting the price of gasoline below $2.50 a gallon to gun the economy.

With four more years of a regime which is the enemy of all things fossil fuel, expect little more than idling in the driveway.

Interest Payments On The Debt Are Not Counted As GDP

So says this guy, here, discussing government spending for GDP purposes:

d. Interest paid on government bonds is NOT counted as part of GDP; the argument is that the interest is not usually for a loan purchasing capital equipment, and therefore is not connected to production; whereas net business interest typically is for a loan used to purchase capital equipment and is counted as part of GDP since it is related to production.

Interest Payments On The Debt Continue To Consume GDP Gains

Interest payments on the debt are reported here.

For the 7 fiscal years from 2006 to 2012, interest payments have totaled $2.898 trillion.

GDP has gone from $13.399 trillion in 2006 to $15.811 trillion annualized in the third quarter of 2012 (using BEA and Federal Reserve z.1 Release figures), up just $2.412 trillion, which means we're still in the hole $486 billion after 7 years.

I don't see the so-called money multiplier working too well here. And for all I know, these interest payments are probably double-counted, so to speak, showing up as GDP, so it's even worse than it looks. It's government spending, isn't it?

You can't borrow your way to growth.

Real Personal Income Still Remains Below The 2008 Peak

Real personal disposable income per capita remains in depression, over 5% lower than it was on May 1, 2008, the all-time high, when it reached $34,641.

As of November 1, 2012 it is at $32,868.

Graph and data here.

Obama is presently swimming the holiday away in warmer climes as his party happily prepares to see your taxes increased on your reduced and stagnating dreams.

Real Retail Sales Still Remain Below The 2006 Peak

Real retail sales still remain below the December 1, 2006 peak of $180.016 billion. The latest report of real retail sales for November 1, 2012 puts them at $178.51 billion.

Graph and data here.

We still remain in a consumption depression nearly six years since the onset despite extending the Bush tax cuts for two years beyond their original expiration date, and despite the first ever emergency reductions to the payroll tax, rolled back 32% for both 2011 and 2012 from 6.2% of each paycheck to 4.2%:

"[F]or the economy as a whole the payroll tax cut amounted to about $112 billion in 2012 – or the equivalent of at least $300 for each person in the US," reports the Christian Science Monitor, here.

Given the 100% propensity to spend everything in a paycheck, the expiration of the payroll tax cut will remove that sum from current retail spending levels. And going back to the Clinton era tax rates in less than two weeks, on January 1, 2013, will mean transferring about $235 billion annually from taxpayers to federal coffers, according the Congressional Budget Office, as discussed here.

Together that's a theoretical annual hit to spending by the American people of nearly $350 billion.

Yet Democrats cry Forward! to these tax rates of the past despite the damage they are likely to cause.

We're not going to get over the hump that way.

Taki is Old and Stupid for giving Oliver Stone a Pass

Here, where Stalin's crimes get a total pass, of which Taki would surely have been a victim had he lived under him:

"Stalin never trusted the West, but he had no designs on taking us over from the outside."

Which just goes to show one good pass deserves another.