In a live interview on CNBC today, Warren Buffett said there has been little progress over the past few months in the "economic war" being fought by the country. "We haven't got the economy moving yet," he told Becky Quick.
While the economy is a "shambles" and likely to stay that way for some time, he remains optimistic there will eventually be a recovery over a period of years.
BECKY: The last time we sat down to talk to you was on May 4, and at that point you told us that you think we're in an economic war right now. How much progress do you think we've made in that war?
BUFFETT: Well, it's been pretty flat. I get figures on 70-odd businesses, a lot of them daily. Everything that I see about the economy is that we've had no bounce. The financial system was really where the crisis was last September and October, and that's been surmounted and that's enormously important. But in terms of the economy coming back, it takes a while. There were a lot of excesses to be wrung out and that process is still underway and it looks to me like it will be underway for quite a while. In the (Berkshire Hathaway) annual report I said the economy would be in a shambles this year and probably well beyond. I'm afraid that's true.
Taking a firm position in an ongoing debate in the financial markets, Buffett says he's not concerned about deflation, but thinks inflation will be a problem in coming years.
Buffett repeated his criticism of "cap and trade" as a method to control pollution, saying it would be a huge, regressive tax.
Wednesday, June 24, 2009
Can You Imagine a Male Nominee Getting Away with This?
WASHINGTON (AP) - Supreme Court nominee Sonia Sotomayor resigned Friday from an elite all-women's club after Republicans questioned her participation in it. Sotomayor said she resigned from the Belizean Grove to prevent the issue from becoming a distraction in her confirmation hearings.
In a letter to Democratic Sen. Patrick Leahy of Vermont and Republican Sen. Jeff Sessions of Alabama, the federal appeals court judge said she is convinced that the club does not practice "invidious discrimination" and that her membership in it did not violate judicial ethics.
But she said she didn't want questions about it to "distract anyone from my qualifications and record."
Federal judges are bound by a code that says they shouldn't join any organization that discriminates by race, sex, religion or nationality.
The Belizean Grove bills itself as women's answer to the 130-year-old all-male Bohemian Club in California. The club owns a 2,500-acre camping area in northern California called the Grove.
Chief Justice Earl Warren belonged to the Bohemian Club beginning in the 1940s, before he joined the court and long before the federal judiciary adopted a code of conduct.
"The Belizean Grove is a constellation of influential women who are key decision makers in the profit, non-profit and social sectors; who build long term mutually beneficial relationships in order to both take charge of their own destinies and help others to do the same," the group says on its Web site. There are about 115 members, the club says.
Earlier in the week, Sotomayor defended her participation in the group, telling senators that it involves men in some of its events and that she was unaware of any man who had tried to become a member.
Sotomayor's backers noted that the court's only current woman, Ruth Bader Ginsburg, belongs to the membership-only International Women's Forum. So did former Justice Sandra Day O'Connor, who defended her involvement in all-women groups during her Senate confirmation hearings in 1981.
Supreme Court Justice Anthony Kennedy faced similar questions over his longtime membership in the all-male Olympic Club in San Francisco. Kennedy resigned his membership in October 1987, as he was under consideration for the high court.
In a letter to Democratic Sen. Patrick Leahy of Vermont and Republican Sen. Jeff Sessions of Alabama, the federal appeals court judge said she is convinced that the club does not practice "invidious discrimination" and that her membership in it did not violate judicial ethics.
But she said she didn't want questions about it to "distract anyone from my qualifications and record."
Federal judges are bound by a code that says they shouldn't join any organization that discriminates by race, sex, religion or nationality.
The Belizean Grove bills itself as women's answer to the 130-year-old all-male Bohemian Club in California. The club owns a 2,500-acre camping area in northern California called the Grove.
Chief Justice Earl Warren belonged to the Bohemian Club beginning in the 1940s, before he joined the court and long before the federal judiciary adopted a code of conduct.
"The Belizean Grove is a constellation of influential women who are key decision makers in the profit, non-profit and social sectors; who build long term mutually beneficial relationships in order to both take charge of their own destinies and help others to do the same," the group says on its Web site. There are about 115 members, the club says.
Earlier in the week, Sotomayor defended her participation in the group, telling senators that it involves men in some of its events and that she was unaware of any man who had tried to become a member.
Sotomayor's backers noted that the court's only current woman, Ruth Bader Ginsburg, belongs to the membership-only International Women's Forum. So did former Justice Sandra Day O'Connor, who defended her involvement in all-women groups during her Senate confirmation hearings in 1981.
Supreme Court Justice Anthony Kennedy faced similar questions over his longtime membership in the all-male Olympic Club in San Francisco. Kennedy resigned his membership in October 1987, as he was under consideration for the high court.
Government Math
Louisiana Senator, Mary Landrieu (D), is presently asking the Congress for $250 BILLION to rebuild New Orleans. Interesting number, what does it mean?
A. Well, if you are one of 484,674 residents of New Orleans (every man, woman and child), you each get $516,528.
B. Or, if you have one of the 188,251 homes in New Orleans , your home gets $1,329,787.
C. Or, if you are a family of four, your family gets $2,066,012.
Earth to Washington, D. C: HELLO!
Are all of your calculators broken??
A. Well, if you are one of 484,674 residents of New Orleans (every man, woman and child), you each get $516,528.
B. Or, if you have one of the 188,251 homes in New Orleans , your home gets $1,329,787.
C. Or, if you are a family of four, your family gets $2,066,012.
Earth to Washington, D. C: HELLO!
Are all of your calculators broken??
Canadian Healthcare
Is this what you want...?
* A 16% higher cancer death rate in Canada
* An eight week wait for radiation therapy for cancer patients
* 42% of Canadians die of colon cancer vs. 31% in the US
* Cutbacks in diagnostic testing
* The best meds for chemo therapy are not available
* No way out of the system; you can't even pay for services yourself
Why is health care so bad north of the border? Because there are too few doctors to treat everybody, and cost savings -- which slice medical incomes -- drive doctors out of the profession.
When Obama calls for a 21% cut in Medicare fees to physicians and a $2500 cut in health costs per capita, that is exactly the kind of downward spiral in medical care quality he will bring to the United States.
By making too few doctors cover too many patients, he will cut the quality of care to everybody.
Say "No!" to ObamaCare!
* A 16% higher cancer death rate in Canada
* An eight week wait for radiation therapy for cancer patients
* 42% of Canadians die of colon cancer vs. 31% in the US
* Cutbacks in diagnostic testing
* The best meds for chemo therapy are not available
* No way out of the system; you can't even pay for services yourself
Why is health care so bad north of the border? Because there are too few doctors to treat everybody, and cost savings -- which slice medical incomes -- drive doctors out of the profession.
When Obama calls for a 21% cut in Medicare fees to physicians and a $2500 cut in health costs per capita, that is exactly the kind of downward spiral in medical care quality he will bring to the United States.
By making too few doctors cover too many patients, he will cut the quality of care to everybody.
Say "No!" to ObamaCare!
Commander In Chief, My A**!
For those who do not know Dave Borden, he is a former Black & Decker employee who lives in Hanover, MA. His son, Dave Jr., was serving in Iraq and was badly injured from a bomb explosion. Dave Jr. has had over 38 surgeries to date. The email below is from Dave Borden about a recent visit to his son by President Obama. The email speaks for itself...
Since Dave Jr. has been injured he has met and been overwhelmed by many, many political and military celebrities. The list includes Secretary of State Bob Gates, who came into his room and told him 3 or 4 times that if Dave Jr. had any issues to call his cell phone number.
It includes General Petraeus who sat and talked with Dave Jr. for almost 45 minutes. The general recalled vividly all of the circumstances around the events that led to fighting that Dave was involved in.
It includes Sen. McCain who arrived late on a Saturday afternoon during a thunderstorm, unannounced, and talked to Dave Jr. about how similar their experiences with fate were.
It includes George Bush when Dave Jr. was invited to attend the very last Christmas party at the White House for the White House Staff. President Bush and his wife entered the ballroom and immediately went to Dave Jr. President Bush knew Dave Jr.'s name as well as when and how he was injured. Dave Jr. had a picture taken with Laura and the President that he has framed and will cherish forever.
The list goes on and on of people coming in to meet Dave Jr. and the other wounded warriors at Waler Reed and Bethesda. Yesterday, Dave Jr. was ordered to be at the National Naval Hospital with another 12 soldiers and Marines to meet with Obama. Obama was supposed to arrive at 11:30 a.m. He finally got there at 3:00 p.m. He entered the room with the wounded warriors and quickly shook each of their hands. He never asked their names, where they were from, or how they were injured. Then he left.
Dave Jr. has met the people who really care about the military. All he remembers from Obama is a weak handshake. The others in the room, younger and less exposed to the people that Dave Jr. has met, were so disappointed.
Word about Obama's "insensitive" visit has spread to the MATC (the rehab facility) at Walter Reed and throughout Bethesda. The military sees through his phoniness. All I can say is that it is such a disappointment that this man is Commander in Chief of our Armed Forces. He is an embarrasment to our nation.
Regards,
Dave Borden, Sr.
Since Dave Jr. has been injured he has met and been overwhelmed by many, many political and military celebrities. The list includes Secretary of State Bob Gates, who came into his room and told him 3 or 4 times that if Dave Jr. had any issues to call his cell phone number.
It includes General Petraeus who sat and talked with Dave Jr. for almost 45 minutes. The general recalled vividly all of the circumstances around the events that led to fighting that Dave was involved in.
It includes Sen. McCain who arrived late on a Saturday afternoon during a thunderstorm, unannounced, and talked to Dave Jr. about how similar their experiences with fate were.
It includes George Bush when Dave Jr. was invited to attend the very last Christmas party at the White House for the White House Staff. President Bush and his wife entered the ballroom and immediately went to Dave Jr. President Bush knew Dave Jr.'s name as well as when and how he was injured. Dave Jr. had a picture taken with Laura and the President that he has framed and will cherish forever.
The list goes on and on of people coming in to meet Dave Jr. and the other wounded warriors at Waler Reed and Bethesda. Yesterday, Dave Jr. was ordered to be at the National Naval Hospital with another 12 soldiers and Marines to meet with Obama. Obama was supposed to arrive at 11:30 a.m. He finally got there at 3:00 p.m. He entered the room with the wounded warriors and quickly shook each of their hands. He never asked their names, where they were from, or how they were injured. Then he left.
Dave Jr. has met the people who really care about the military. All he remembers from Obama is a weak handshake. The others in the room, younger and less exposed to the people that Dave Jr. has met, were so disappointed.
Word about Obama's "insensitive" visit has spread to the MATC (the rehab facility) at Walter Reed and throughout Bethesda. The military sees through his phoniness. All I can say is that it is such a disappointment that this man is Commander in Chief of our Armed Forces. He is an embarrasment to our nation.
Regards,
Dave Borden, Sr.
Quote of the Week
"If George W. Bush had proposed to double the national debt, which had taken more than two centuries to accumulate, in one year, would the media have approved? And if George W. Bush then proposed to double the debt again within 10 years, would the media have approved?"
Tuesday, June 23, 2009
California: A Glimpse Into America's Future
Thanks to runaway liberalism, California is going bankrupt...
California Collapsing
Washington and Wall Street seem to be treating California as if it were a sideshow in the financial circus of these turbulent times.
It's not.
California is home to the largest manufacturing belt in the United States and to Silicon Valley, the nation's largest high-tech center.
California is America's most populous state with 38 million people. Its GDP of $1.8 trillion is the largest in the U.S. Its economy is bigger than those of Russia, Brazil, Canada, or India.
And it's collapsing.
Major California counties are ground zero in the continuing mortgage meltdown:
Los Angeles County with 5.32 percent of mortgages 90 days past due ... Monterrey County, 8.02 percent ... Imperial, 8.13 ... San Bernadino, 8.66 ... Madeira, 9.21 ... San Joaquin, 9.53 ... Riverside, 10.2 ... Merced, 10.57 ... and more!
California's inventory of foreclosed homes is skyrocketing. Home prices are plunging. And the impact of surging unemployment is just beginning to show up in the data ...
Worst Unemployment in 64 Years
The state's unemployment rate has surged to 11.5 percent, the worst since World War II.
Last month, California lost 68,900 jobs. And since July 2007, it has lost 859,000 jobs, including 739,500 just in the past 12 months.
Even if the economy recovers, an unlikely scenario in my view, economists agree that California will continue to be slammed by layoffs, at least through the end of this year and probably well into 2010.
And even assuming a national recovery, UCLA's Anderson Forecast projects an average unemployment rate of 12.1 percent from this fall through next spring.
What about without a national recovery? California's jobless could go beyond 15 percent.
Worse, if you include part-time workers seeking full-time work plus workers who have given up looking entirely, it could reach 25 percent, exceeding the worst national unemployment levels of the Great Depression.
"Our wallet is empty.Our bank is closed. Andour credit is dried up."
These are not the words of a Dr. Doom in New York or a forlorn banker in Georgia. They represent the confession of Governor Arnold Schwarzenegger before a rare joint session of the California legislature ... and with no exaggeration!
The state faces a stunning $24.3 billion budget deficit, even assuming no significant deterioration in the economy from this point onward. And the state has lost virtually all hope of President Obama declaring, "California is too big to fail."
California State Treasurer Bill Lockyer tried to make that argument to Washington, and did so with great vigor. But he was rejected. After the long line-up of failed companies with hat in hand in recent months — on the steps of Congress or the White House lawn — some folks in government finally appear to have learned how to just say "no."
"You're on your own," is the message from the president to the governor. "Beyond your share of the stimulus package, that's it! No more!"
Result: The inevitability of massive state cutbacks, including large numbers of state jobs getting axed — all while the California jobless rate is already 11.5 percent.
How many state jobs are in jeopardy? Right now, Schwarzenegger is proposing laying off 5,000 state employees, as well as slashing education and social welfare programs. But the Anderson Forecast projects that Schwarzenegger's budget cuts will eventually result in 64,000 job cuts from state government plus countless private-sector and local government jobs.
Massive Downgrades Coming
California's credit rating is already the lowest among all U.S. states.
But with Moody's, S&P, and Fitch still greatly influenced by massive conflicts of interest, it's not nearly low enough.
And sure enough, on Friday, Moody's tacitly admitted as much, announcing that it may have to cut California's rating by several notches in one fell swoop!
Standard & Poor's put California on watch for a possible downgrade a few days earlier. Fitch did the same May 29.
The big problem: Once downgraded, California's rating is likely to fall below the minimal level legally required for most money market funds, forcing these funds to dump California paper posthaste.
Moody's wrote:
"If the Legislature does not take action quickly, the state's cash situation will deteriorate to the point where the controller will have to delay most non-priority payments in July. ... Lack of action could result in a multi-notch downgrade."
But lack of action is precisely what Sacramento is now becoming most famous for. In fact, in their latest scuffle, Democrats proposed a budget that would raise $2 billion from cigarette taxes and oil companies. But the governor promptly vetoed the plan. So now Sacramento is in a new, escalating battle over the deficit just weeks before the state is expected to run out of cash to meet payroll and other bills.
State officials continue to insist that a state default is unthinkable ... much like GM executives said their bankruptcy could never happen.
In my view, there is a very HIGH probability that California will default.
It's obvious its debt merits a junk bond rating from every Wall Street rating agency.
And it's equally obvious that the ratings agencies are artificially inflating the rating, stalling downgrades, and grossly understating the risk to investors.
My recommendations:
1. If you wait for Moody's or S&P to act, it could be too late. Even if you can't get what you might consider a good price, sell all California paper now!
2. Seriously consider dumping all tax-exempt bonds. I know the income is better than equivalent Treasuries. But if California defaults, it could set off a chain reaction of bond price plunges and defaults throughout the municipal bond market.
3. Don't underestimate the impact California's depression is having — and will continue to have — on the rest of the U.S. economy. At $1.8 trillion, the state's GDP is so large, any further deterioration could wipe out every so-called "green shoot" in the national economy seen to date.
4. Stay safe, with a big portion of your nest egg in cash, tucked away in short-term Treasury bills ... and with a very modest portion in gold, as an insurance policy against a dollar decline.
Good luck and God bless!
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