Stephen Moore tells some whoppers: Income was FALLING long before the 2013 increase in the capital gains tax rate

From Stephen Moore of the Heritage Foundation, here:

"When Mr. Obama entered office the capital gains and dividend tax was 15 percent. Then he raised it to 20 percent and then he added a 3.8 percent investment surtax, bringing the rate to 23.8 percent. The tax rose by more than 50 percent. ...

"Wages have stagnated under Mr. Obama as taxes have risen on capital."

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Nice try at hiding the chronology, Moore, but no cigar.

Real median household income and real gross private domestic investment crashed in tandem and in concert with the 2007 recession. The investment side rebounded quickly, but real household income did not, and still hasn't. What's more, the whole phenomenon preceded any increase in the capital gains tax rate, which didn't pass until January 2013, with Republican support by the way. 

And it won't do to talk about wages stagnating, either. Real incomes have actually fallen, and fallen big. Employers figured out that the 2008 crisis gave them the cover they needed, their golden opportunity, to shed millions of expensive workers and rehire younger, cheaper ones. It's the biggest scandal in recent history, much bigger than the lies about ObamaCare, but no one is going to talk about it, least of all libertarians who are happy that the business inputs cost less.

The incredible rebound in investment is on the backs of all this labor shed in the crisis, helped along by rock bottom interest rates for those who are first in line for the money: bankers and businesses.

So-called conservatism never looked so bad.  

The housing bubble was mainly a middle class and higher phenomenon, not of the poor

From Robert Samuelson, here:

". . . in poorer neighborhoods . . . the actual borrowers . . . were much richer than average residents. In 2002, home buyers in these poor neighborhoods had average incomes of $63,000, double the neighborhoods' average of $31,000. ...

"In 2002, the mortgage-debt-to-income ratio of the poorest borrowers was 2; in 2006, it was still 2. ... 

"[T]he bulk of mortgage lending and losses [during the housing bubble] - measured by dollar volume - occurred among middle-class and high-income borrowers. In 2006, the wealthiest 40 percent of borrowers represented 55 percent of new loans and nearly 60 percent of delinquencies (defined as payments at least 90 days overdue) in the next three years."

Grand Rapids, Michigan, starts 2015 with a January temperature anomaly of -3.2 degrees F

And 23.2 inches of snow after December's paltry 0.3 inches and November's deluge of 31.0 inches.

Here we go again.

It speaks volumes about our society that Rush Limbaugh has never been able to count in Roman numerals

Under his "Pearls of Wisdom" no less, here, last week:

"Is this Super Bowl XLIX? Super Bowl XLIX. I've lost track of the ability to count the Roman numerals. Not that I ever did know."

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Maybe he'll finally figure it out next year at "Super Bowl L".

Oops, sorry. The NFL is giving up the Roman numeral counting system for Super Bowl 50, according to Wikipedia, here:

"Instead of naming it Super Bowl L with Roman numerals like in previous Super Bowls, this game will be marketed with the Arabic numeral '50'. The game is scheduled to be played on February 7, 2016, at Levi's Stadium in Santa Clara, California, the home stadium of the San Francisco 49ers. This will be the first Super Bowl held in the San Francisco Bay Area since Super Bowl XIX in January 1985."

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I guess you'll still need to know the Roman numeral system to count Super Bowl XIX.

Surely The Apocalypse is nigh.

But to me it will still be "Super Bowl L", not to be confused with the official name of the trains of the Chicago Transit Authority:

Only in the United States of Moronica.

Kevin Drum admits ObamaCare is a cost to the middle class, not a benefit

Here in Mother Jones last November:

[N]early all [ObamaCare's] benefits flow to the poor. ... winners are those with household incomes below $25,000 or so, and losers are those with incomes above $25,000. ... If you think of Obamacare as something that benefits the working and middle classes, you're probably wrong. It may benefit a few of them, but overall it's a cost to them ... the bottom line is simple: like most of the social welfare programs championed by Democrats, Obamacare is primarily aimed at the poor. Once again, the working and middle classes are left on the outside looking in.

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First Obama did nothing about housing, the sine qua non of the middle class: Over five million completed foreclosures eliminated millions from the middle class without firing a shot.

Then he did nothing about jobs, without which no one buys a house: 18 million have been added to the potential workforce but haven't actually joined it.

Then he rammed through healthcare reform, which was designed to raise costs on the middle class.

And people wonder how Obama could even think of taxing their 529 plans?

The middle class is the enemy of the revolution, the object of the transformation, the source for the redistribution.

So, Libya was really Hillary's war, and more broadly the women's war, not Obama's

From the first part of an investigative report, here, which details that there were secret recordings between Gaddafi's son and none other than Rep. Dennis Kucinich, now out of office:

Mr. Kucinich, who challenged Mrs. Clinton and Barack Obama for the 2008 Democratic presidential nomination, acknowledged that he undertook his own conversations with the Gadhafi regime. He said he feared Mrs. Clinton was using emotion to sell a war against Libya that wasn’t warranted, and he wanted to get all the information he could to share with his congressional colleagues. ...

Numerous U.S. officials interviewed by The Times confirmed that Mrs. Clinton, and not Mr. Obama, led the charge to use NATO military force to unseat Gadhafi as Libya’s leader and that she repeatedly dismissed the warnings offered by career military and intelligence officials. 

In the recovered recordings, a U.S. intelligence liaison working for the Pentagon told a Gadhafi aide that Mr. Obama privately informed members of Congress that Libya “is all Secretary Clinton’s matter” and that the nation’s highest-ranking generals were concerned that the president was being misinformed. ...

Instead of relying on the Defense Department or the intelligence community for analysis, officials told The Times, the White House trusted Mrs. Clinton’s charge, which was then supported by Ambassador to the United Nations Susan E. Rice and National Security Council member Samantha Power, as reason enough for war.

Dang, Romney says he won't run

Now who will stop Jeb?

Secretary of State John Kerry who served in Vietnam fined $50 for not shoveling snow at his Boston residence

Story here:

Boston city officials issued a ticket to Kerry’s home for neglecting to shovel his sidewalk on Thursday, according to Citizens Connect, a website run by the city of Boston where residents can upload complaints.

John Kerry, who served in Vietnam, has also been rumored in the past to avoid stopping at four way stop signs in his Jeep, and to avoid paying taxes on his yacht domicile.

One law for me, another for thee. 

Hm: Obama makes it to Arabia within 4 days of the king's death, but couldn't pull off DC to Paris for Charlie Hebdo

King Abdullah died on the 23rd, on which he was immediately buried, and Obama scurried from India to Saudi Arabia by yesterday, the 27th, to pay his respects.

The Charlie Hebdo massacre in Paris was on a Wednesday, the 7th, and the infamous parade of idiots which Obama did not attend and to which he did not send a representative occurred on Sunday the 11th.

The flight time for the former is less than 5 hours, and for the latter about 7.5 hours.

Funny how security can be so hastily arranged, from so far away, when the trip really matters.

Obama is still a rookie after 6 years in office: drops proposed tax on 529 plans after massive blowback

CNBC reported the story here.

Evidently the White House realized the idea was a non-starter when someone explained that the 529 plans would stop being funded, meaning there would be insufficient revenue to fund alternatives, as reported here:

'On "Power Lunch," [Joe] Hurley [of savingforcollege.com] said this tax will deter people from using 529 plans. "Taxing 529 plans won't pay for any other initiative because people will no longer be using 529 plans," he said. "You can't raise revenue when you don't have any contributions going into these plans."'

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Well DUH!

Analyst says oil price plummet primarily driven by OPEC abandoning swing producer role

Dirk Leach, who also credits the rising dollar but not to the extent others have, here:

"Now that OPEC has abdicated their role as swing producer, the only mechanism to stabilize oil prices is the market itself based on supply and demand. As we are now seeing, the supply side of that balance has a lot of inertia. Despite some analysts' view that shale production can be turned on and off rather quickly, the time it takes to decrease production is measured in months or quarters while the crude oil price response is essentially immediate. Going forward, we appear to have a crude oil market pricing system with a very fast response time and a very slow feedback mechanism (supply adjustments). Generally, this type of system is not very stable and results in frequent large swings in market pricing. Going forward, it might be a more bumpy oil market than we have been used to."

Obama wants to tax 529 plans, 53% of which are owned by those making less than $100k

So reports The Wall Street Journal here about Obama's latest attack on the middle class:

"The average account balance [of 529 plans this June] was $20,671. ... The Investment Company Institute, trade group for the mutual-fund industry, says that in 2013 households saving for college through 529 plans, Coverdell ESAs, or mutual funds held outside these accounts tended to be headed by people younger than 45. And 49% of these heads of household had fewer than four years of college. A majority of these households, 53%, earned less than $100,000."

The dollar has surged 2.26% since Wednesday to trade at 95 this morning

The dollar hasn't traded at 95 since late 2003.

Much more of this dollar strength is due to the continued improving fiscal condition of the United States since 2012 than people realize. 

Tax revenues are way up under the made-permanent Bush tax cuts and the made-permanent Alternative Minimum Tax fix, both of which heralded in 2013. Federal receipts are up a whopping combined 36% in 2013 and 2014 over 2012.

And continued Republican control of the purse in Congress has meant almost zero expansion of federal spending. Federal outlays are up a paltry combined less than 1% in 2013 and 2014 over 2012.

The federal government is up a net $845.5 billion in the last two years. That's huge.

The dollar is not simply a fiction which competes with other fictions in the global marketplace, but a symbol of the determination of the American people to play by the rules and pay their bills. It is not a coincidence that this determination lately expressed politically paved the way for falling commodity prices generally, and oil in particular. It is uncertainty which breeds fear-trades.

Speaker John Boehner doesn't get the credit he deserves for achieving under the Democrat President Barack Obama what Republicans before him could only dream about.

And if you want to know what's wrong with Republicans, that's it.

Strange fact of the day: Both General Lee and MLK Jr. were born in January

Born January 19th

Born January 15th

Likely primary voters prefer Mitt Romney to Rubio and Bush in latest Zogby poll

Bank Failure Friday: The Second of 2015

Highland Community Bank, Chicago, Illinois, failed tonight, costing the FDIC $5.8 million.

This is bank failure number two in 2015.

S&P 500 market capitalization/GDP ratios the years before plus-20% crashes

http://www.advisorperspectives.com/dshort/commentaries/CAPE-at-Market-Peaks.php

1955: 104*
1956: 101
1957:   84

1960: 107
1961: 123
1962: 103

1965: 120
1966:   96

1967: 109
1968: 107
1969:   88
1970:   84

1972:   89
1973:   66
1974:   43

1979:   40
1980:   45
1981:   37
1982:   41


1986:   52
1987:   49

1999: 148
2000: 126
2001: 107
2002:   79

2006: 101
2007: 100
2008:   62
2009:   77

*The ratio is the S&P 500 level at the end of the calendar year divided by 4Q final GDP in trillions of dollars. The average peak ratio in the series is 99. The average trough ratio is 71. The average spread between peak and trough ratios in the series is 27%. The ratio through 3Q2014 is 112, 13% above the average peak in the series.

The chart from Doug Short gives the Shiller p/e ratios on the record dates. The average peak of these is 22.6, the average trough is 14.2, and the average spread between them in the series is 35%. The Shiller p/e ratio at the end of 3Q2014 was 25.16, 11% above the average peak in the series. 

Oh the horror: Did you know the personal savings rate INCLUDES IRA and 401(k) contributions?

The annual average of the rate is shown.

Then how come the personal saving rate has been in steady decline since 1974 when IRAs were first passed into law? And how come saving didn't improve after 1978 when 401(k) plans were first created? Or after 1997 when Roth IRAs were legislated? The current monthly reading of personal saving is a measly 4.4%.

A rich country saves, a poor one spends.

"Notice that NIPA’s [National Income and Product Accounts] treatment of IRAs and 401(k) plan contributions, for example, is perfectly consistent: Because these defined contributions are not part of personal outlays (and, therefore, must be included in the difference between personal income and personal outlays), they are correctly included in national saving computations."

-- Massimo Guidolin and Elizabeth A. La Jeunesse, "The Decline in the U.S. Personal Saving Rate: Is It Real and Is It a Puzzle?" in Federal Reserve Bank of St. Louis REVIEW, November/December 2007, p. 499, footnote 13 (here)

Hey Obama! Tell me how we get to yes . . .

. . . for life!

Jobless claims so far in 2015 are running 6.25% below the same period in 2014

First time claims for unemployment have averaged 450,000 per week in the first three weeks of January 2015 compared to 480,000 per week in the first three weeks of 2014, not seasonally adjusted.

The claims spike last week was equalized by a spike to the downside this week.