Archive for February, 2010

Lessons on Health Care From 50 Years Ago

February 25, 2010

Ronald Reagan once said,

Governments don’t tax for the money they need, they find need for the money they get!

Never were truer words spoken and Mr. Reagan reiterated that quote in a speech he recorded about 50 years ago that is right now becoming a sensation on You Tube.

50 years ago, the subject of socialized medicine was a hot topic, just like today, only today they call it health care reform.

50 years ago, certain elected officials in Congress were preying upon the guilt of Americans, saying that socialized medicine was absolutely necessary to prevent people from being denied the health care they need, just like today, only today, they call it health care reform.

50 years ago, the idea of socialized medicine was floated again after being soundly beaten down by Americans during the Truman Administration a few years earlier, just like today, only today they call it health care reform, which was beaten down by Americans a few years ago during the Clinton administration.

50 years ago people were concerned that socialized medicine would take away their freedom to choose their own doctor, just like today, only today, they call it health care reform.

50 years ago, doctors were concerned that socialized medicine might infringe upon their ability to practice in the city or region of their choice, or perhaps interrupt their income, just like today, only today, they call it health care reform.

50 years ago, the memory of the great depression and the pain of war were very much on the minds of Americans when socialized medicine was proposed, just like today, only today they call it an economic downturn and health care reform.

Governments don’t tax for the money they need, they find need for the money they get!

Just a few weeks after being told by the voters of Massachusetts, the bluest of all the blue states, that spending a trillion dollars for health care reform is not what the people want, President Obama, nonetheless, trotted out his nearly $1 trillion version of health care reform……

Hello? Earth to Washington….

Please acknowledge that you can hear us……

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When To Wean and How Much, How Fast?

February 10, 2010

Like weaning a baby off the bottle or weaning a brand new puppy, there comes a time in life when total dependence on someone or something has to end.

That was the sound we were hearing from the Federal Reserve this week as Ben Bernanke
announced plans to dismantle the central bank’s
supports for the US economy.

Bernanke said the Fed will likely start
tightening credit by boosting the interest rate it pays banks on
deposits with the central bank.

But the Fed has a very tough balancing act if they move too quickly to raise rates. The entire economic implosion can be directly traced to the housing boom, bubble and bust and the housing market is just…beginning to slowly creep back…and only in some parts of the country…in many places, the bust is still …..a big bust.

Home prices, being somewhat held up by low rates, could suffer when rates go higher. Buyers who can now afford a $1,400 monthly payment on a
$250,000 mortgage when rates are 5.5 percent….. may not be willing to pay that much for a house if rates go to 7 percent, in which case the monthly
payment would be $1,660.

What about people with adjustable rate mortgages who may be upside down in their homes, owing more than they are worth, but continue to persevere, because the payment is still relatively affordable…?

What happens if rates start climbing and more people start walking away from those homes and their obligations?

Can you say, right back to square one?

It is, at best, a dicey period of transition and the government will no doubt try to back off of their involvement in the economy in one area, while trying to increase their involvement in another.

In Europe, serious debt issues have piled on to
a plethora of economic problems …add to that concerns about China’s plans to
curtail economic growth to avoid speculative bubbles….. and then President Obama’s
calls to restrict trading at large financial institutions and you can easily see why Wall Street has been behaving like a scared rabbit the last couple of weeks.

To wean or not to wean…that isn’t the question…the real question is when…and how fast and by how much?