On the "Job Loss" "Recovery"

First, it was the jobless recovery, where the economy was magically getting better due to the artificial increases in spending fueled by deficit currency devaluation and favoritist handout programs. Then it became the "job loss" recovery, when it became more obvious that the various handout programs and Kabuki Theater money printing and shuffling wasn't actually creating or even preserving any actual jobs. At some point, maybe, in the distant future, some astute historian can berate the current administrations and its other various socialist-leaning philosophical supporters with something akin to "it's all about the jobs, right, and those blithering morons just couldn't get the trivially simple concept into their empty fascist skulls".

The American economy is not going to get "better" without jobs. On the upside, a healthy business and job environment does wonders to cure many economic ills; on the downside, every Democrat policy, thought, and action seems expressly designed to crush job creation and maintenance, and the blithering morons are running the country currently. Government jobs (explicitly, as in all the people directly employed by various government agencies, or implicitly, as in all the people employed as a result of the government printing money and/or subsidizing various industries above and beyond their normal competitive capacity) are a net zero: they don't help, but there are far worse things the government could be doing as it strips the remaining remnants of economic prosperity from our children (eg: creating a nationalized health care nightmare).

This goes along with another facet of the same problem: handouts. Handouts (subsidization, stimulus, support, etc.) are the antithesis of jobs; not only do they supersede the will/need to create/have jobs, but they encourage a national philosophy of begging for more handouts, which is even more destructive to economic prosperity. It has become more obvious to me, recently, that the whole handout mindset is likely the #1 long-term ailment of the US economy, and the enormous psychological damage which handout programs inflict on the US is downplayed, or outright ignored, when handout programs are considered. Americans have moved beyond asking what their country can do for them, and now are upset when their country does not do enough for them, and we will not be able to recover economically until or unless we somehow halt the progression of this crippling philosophical disease. Yes, it really is that bad.

If our esteemed leaders and "public servants" has any interest at all, in the slightest, in helping the people of the country, they would be focused nearly-entirely on private sector job creation, and on eliminating handouts. The day I hear the beggar on the street change his pitch from "can you spare some money" to "anything I can do to earn some money from you" is they day I know we have succeeded in reversing the tide of national sentiment. Instead, all the US people seem capable of debating is who should get what in the latest handout programs, and it's a road to ruin.

It doesn't matter as much who gets what benefits in Obamacare, or how much banking executives are allowed to pay themselves out of government subsidization, or how long unemployment benefits are extended, or how much money the government gives to the housing industry to reward them for the bubble: they are all, every one of them, symptoms of a greater, more insidious, and immensely more destructive meta-problem. We, the people, should not be asking how we can mold the latest handout program to be less detrimental; we need to be thinking about how we can eliminate the root scourge of political malfeasance which continues to doom the American people to a life of servitude and begging for scraps from the master's table. If we can free ourselves from this latest crushing evil, economic recovery, prosperity, and freedom from government oppression would come along for free.

Been away...

I'm sure some people noticed; I've been on vacation for the last couple weeks, with spotty internet access. That, and the resurgence of playing a certain MMO has left me with less free time to allocate to blogging about the idiocies of the world. I have not, however, experienced a significant decline in opinions; and you can expect to see a few more posts shortly with possibly some travel observations and likely some political current events opinions.

Just to be clear for my readers, though (since I'm getting enough followers to care about keeping people somewhat informed), this blog won't be a daily thing; if you want daily news recaps and commentary, there are several other excellent sources, some of which I myself follow (LCR for political current events, CR for econ news, etc.). I'll keep posting sporadically, maybe a few times a week, on topics which interest me and/or philosophizing on how things should work in my idealized world. Hopefully that'll work for ya'll out there in internet-world.

Good to be back. :)

Leaving (fleeing?) California

For reference, this article paints a pretty clear picture about why I'll likely be leaving the [previously] Golden State in the next couple of years. I'm not sure what happens when a state fails, when the poverty-stricken, largely-illegal non-tax-paying masses overwhelm the legitimate legal residents, when the education system finally collapses under the weight of its own malaise and corruption, when the state finances finally collapse under the weight of decades of financial idiocy and irresponsibility, when the government cannot function any more... but I'm pretty sure I don't want to be living here when it happens. I think the best California can hope for at this point is a clean start, a purging of the entire broken horribly-failed experiment, a re-write of the state Constitution to include many more protections from the current state, actual enforcement of immigration laws, and a new competent government with minimal social unrest. On its current trajectory, though, the future looks decidedly less optimistic.

More fleshed out thoughts on preventing future housing bubbles

I've been giving this more thought recently, since pretty much nothing has been done to try to prevent future housing bubbles (indeed, the current administration/Congress has only done things to make the post-bubble recession worse). I've had thoughts on this previously, but these are my new, more fully-formed ideas, the up-to-date thoughts from my brain on this issue (until they get revised again).

First, let's establish some guidelines. An affordable loan is one which is approximately no more than 4x your annual income, based on general loan guidelines. Second, we'll call a loan made to someone which brings their total outstanding loan balance for all existing loans at the time of the loan under 4x annual income a "qualified" loan. Third, for annual income, we're talking average of last 2 years reported gross income for tax purposes.

Ok, so here's the thoughts:
- No loan which is not "qualified" can be subsidized by the government, at all, or traded on the government-backed exchanges. So no FHA, no Fannie Mae, no government money whatsoever for any non-qualified loan.
- No security containing or based on (eg: a derivative of) a non-qualified loan can be rated higher than A, by law, and cannot be owned by any fund/organization which buys only "investment-grade" securities.
- This one is more of a personal-preference, but I suggest we officially call non-qualified loans (by the above definition) "Over-extended" loans. This way there is no confusion about the intent, and it will be more difficult for ambitions RE industry people to push unsuspecting buyers into risky, over-extended loans.

At this point I'd normally make a wrap-up comment about how the Obamanation has failed horribly at their purported goal of consumer protection, and how all their so-called "reforms" are just socialist power-grabs, but I think at this point if you're smart enough to be reading blogs (or just reading, for that matter), the corruption and malfeasance of the Obama administration and our current Congress is probably self-evident, so I'll leave my thoughts to stand without the closing obligatory admonition of the idiots currently running the country (unless you count this sentence). :)

Entirely predictable result transpires

Today, the WSJ noted that in the aftermath of the Cash for Clunkers debacle, the auto industry is in turmoil, with sales declining precipitously after the artificially-created demand dried up, as would be expected from something which merely distorted the demand curve, rather than actually stimulating demand (like, for example, creating more jobs would). This is causing dealerships to struggle, distortions and inefficiencies rippling through the supply chains, and further economic damage.

So to summarize, these are the entirely predictable results of this latest brain-dead handout scheme:
- Waste billions in taxpayer dollars for no economic benefit
- Create distortions in the auto manufacturing and supply by only giving handouts for buying certain types of cars, rewarding the manufacturers of those models disproportionally (with taxpayer dollars)
- Compressing the demand curve, creating distortions in the industry which will lead to closed dealerships and suppliers, costing more jobs and doing more damage to the US economy

... and yet, even with all that, we get news reports about how this was an unexpected side-effect, and nobody could have predicted, etc. Hello? Is anybody home upstairs in any of the "news" outlets? The only headline about this should be "Idiotic Bailout does Entirely Predictable Damage to Economy", possibly with an addendum to write your congress-morons if you didn't want your children's tax money spent on hastening the demise of the American Dream.

Cause there's another equally idiotic handout extension to distort the housing market further in the pipeline...