As a quick background the M3 is a  measure of the amount of all monies  except that which  people have stashed in bank vaults, federal reserve bank credit, and money market funds so just about everything that can  be reasonably considered to be available to be spent or invested etc.

As an indicator of economic activity, the M3 has had the most success predicting longer lasting  or drastic economic trends,  some say that it may be too volatile for shorter term prophesying and they may be right.

Either way the theory is this, if there is a lot of money out there then the economy will hum along as that money feeds the industrial furnace. If the supply of money available is small then obviously business have a hard time getting it and the consequences may be either an economic slow down  if demand is weak or ever higher inflation is demand is strong.

The current economic activity and lack of inflation indicates that the demand is not exactly high.

Here is the rub,  April’s measurement  of the M3 really pooped the bed, dropping from $14.2 trillion to $13.9 in the previous  three months. Worst yet  institutional money market funds drooped  37% , the sharpest drop ever.

We have not seen numbers to match these since the Great Depression!

What is the Obama brain trust doing about this? Not a damn thing.  wait actually if that was the case it would be an improvement over what they are doing now. For sarters the Charmain of the Federal Reserve has decided that the best way to fix the problem that may be foretold by the M3 supply is to stop measuring the M3 supply. Seriously , that’s exactly what we did! We discontinued the official M3 supply measurements.  “Doctor, doctor, do something the EKG shows the patient is going into cardiac arrest! Oh that’s OK just disconnect the machine”

So Obama, Bernanke , Larry Summers – Obama’s chief economic adviser- as well as Obama’s lesser economists such as Nobel Laureates , Paul Krugman and Joe Stiglitz are all concerned and as one White House watcher said “they are deathly afraid of the economy going into a double dip”. The thing is that what they plan to do about it is to implement exactly the same policies that have gotten us here in the first place!!

To wit, just weeks after Obama pledged to reign in deficits and spending the administration’s economic lap dogs led by Larry Summers  are telling congress that they need additional tens or hundreds of billions of dollars, to continue the same policies that got us here!

Obama’s economic team,  Bernanke , Larry Summers, Paul Krugman and Joe Stiglitzaa are all Keynesian economists , ie. “demand siders, just like Jimmy  Carter  and his team were. The difference is that Obama spent exponentially more money, money that we don’t have, than Carter and his cronies ever did perhaps they even spent us past the point of no return.  If so it will be a very expensive lesson to learn what history has shown us time and time again, communism with it’s centralized demand side economy doesn’t work. In fact it brings about death and misery.

The UK telegraph has a great article on this here

The corporate jet is now the symbol of the new Obamminist America where all will be equal and private planes will be used only by Obama and Pelosi and Reid and Bidden and Rham Emanuel and David Axelrod and Tim Geithner well you get it…

I remember when the heads of  GM ( now Obama motors) and Chrysler came to the Capitol begging  for your money to keep $130,000 per year employees employed with money taken from Americans making an average of $45,000 per year. The CEOs  all came on private jets, were immediately chided by the comintern democrat congress and the next time they showed up in hybrid sub compacts- and  yeah that not only made it all, GM and Chrysler and the entire economy better but also that “ought to learn’em a thing or two.”

Well guess what ?  The very same administration and the very same congressmen who so righteously riled against businesses owning private jets, have just given $4.7 million of your money to “Lockheed Martin to study supersonic corporate jet travel”

I suppose Obama and the rest of congress isn’t all that against corporate jets after all just as long as they are paid for with your money.

Click here to read a great article of pork subsidies in the aircraft industry and below you’ll find the vids of Obama and Garry Ackerman and Brad Sherman, democrats all, pontificate on the evils of private jets.

This is the story that Reuters published and then pulled so as to not unmask the effects of the Obama administration tax hikes-  do you have any doubt as to where we are heading?

NEW YORK (Reuters.com )–The Obama administration’s plan to cut more than $1 trillion from the deficit over the next decade relies heavily on so-called backdoor tax increases that will result in a bigger tax bill for middle-class families.

In the 2010 budget tabled by President Barack Obama on Monday, the White House wants to let billions of dollars in tax breaks expire by the end of the year — effectively a tax hike by stealth.

While the administration is focusing its proposal on eliminating tax breaks for individuals who earn $250,000 a year or more, middle-class families will face a slew of these backdoor increases.

The targeted tax provisions were enacted under the Bush administration’s Economic Growth and Tax Relief Reconciliation Act of 2001. Among other things, the law lowered individual tax rates, slashed taxes on capital gains and dividends, and steadily scaled back the estate tax to zero in 2010.

If the provisions are allowed to expire on December 31, the top-tier personal income tax rate will rise to 39.6 percent from 35 percent. But lower-income families will pay more as well: the 25 percent tax bracket will revert back to 28 percent; the 28 percent bracket will increase to 31 percent; and the 33 percent bracket will increase to 36 percent. The special 10 percent bracket is eliminated.

Investors will pay more on their earnings next year as well, with the tax on dividends jumping to 39.6 percent from 15 percent and the capital-gains tax increasing to 20 percent from 15 percent. The estate tax is eliminated this year, but it will return in 2011 — though there has been talk about reinstating the death tax sooner.

Millions of middle-class households already may be facing higher taxes in 2010 because Congress has failed to extend tax breaks that expired on January 1, most notably a “patch” that limited the impact of the alternative minimum tax. The AMT, initially designed to prevent the very rich from avoiding income taxes, was never indexed for inflation. Now the tax is affecting millions of middle-income households, but lawmakers have been reluctant to repeal it because it has become a key source of revenue.

Without annual legislation to renew the patch this year, the AMT could affect an estimated 25 million taxpayers with incomes as low as $33,750 (or $45,000 for joint filers). Even if the patch is extended to last year’s levels, the tax will hit American families that can hardly be considered wealthy — the AMT exemption for 2009 was $46,700 for singles and $70,950 for married couples filing jointly.

Middle-class families also will find fewer tax breaks available to them in 2010 if other popular tax provisions are allowed to expire. Among them:

* Taxpayers who itemize will lose the option to deduct state sales-tax payments instead of state and local income taxes;

* The $250 teacher tax credit for classroom supplies;

* The tax deduction for up to $4,000 of college tuition and expenses;

* Individuals who don’t itemize will no longer be able to increase their standard deduction by up to $1,000 for property taxes paid;

* The first $2,400 of unemployment benefits are taxable, in 2009 that amount was tax-free

Lloyd Blankfein, Chairman Goldman Sachs

The Official Obama Propaganda Organs, that would be just about all the media with the exception of FOX, talk radio and blogs such as this one, fell over themselves to hail Goldman’s Sachs announcement that they will not offer “cash bonuses” for it’s  top executives.

Understand that this preemptive announcement is meant to hide the fact that the bonuses will be the outrageously high, probably the highest ever and yes it was accomplished with your money! Not only that but Obama’s financiers, Warren Buffet is getting $500,000, 000  ( don’t bother counting the zeros its five hundred million) from Goldman Sachs  every year just in interest payments..again, largely thanks to your money!

What did you say? You have no job and no money for Obama and Soros and Geithner and Buffet to steal? Don’t worry they’ll just put your kids and grand-kids in hock

For you see, while ACORN and other Obama agitators made a showing of going to the houses of AIG executives and protesting and hollering racial insults at them, the true fleecing was going on across the street at Goldman Sachs. The administration is counting in the fact that most Americans don’t understand the “complexity” of the transaction.

…It’s because he gave your money and your children and grandchildren’s money to Goldman Sachs, Warren Buffet, George Soros etc. They in turn give the money to Obama and ACORN and you and your family have become surfs indentured to the Marxist left and their cronies in high finance.

The Theft  ( inside job)

Well, here is a quick reminder of how the theft of your money actually happened and in spite of what Obama says it was really, really  simple.  The government ie. the New York Federal Reserve Chairman  agreed  to pay the banks 100% of the price of the swaps that the banks including Goldman Sachs had bought from AIG.

Its simple really, Goldman Sacks bought the “swaps” ( don’t worry about what that means it doesn’t really matter) for 40 cents on the dollar and the  Government gave them 100 cents on the dollar for them. That’s it, that’ s the brilliant “complicated” solution that Geithner’s brain belched out

This theft of your money  was facilitated  directly  by the then  Chairman of the Federal Reserve Bank of New York just  as Bloomnerg reported after viewing the documents , “Part of a sentence in the document was crossed out. It contained a blank space that was intended to show the amount of the haircut the banks would take, according to people who saw the term sheet.” (The term  “haircut” is financial slang representing  the discount to par that an assets sells for.  Say you bought a stock for $10 and sold it for $6 you got a 40% “haircut”.)

Clearly the FED initially sought to not pay full price to Goldman Sachs and a few other banks but rather, rightfully, allow them to take responsibility for their mistakes.  The Chairman of the New York Federal Reserve Bank himself intervened and with a magic marker blacked out that sentence and gave Goldman Sachs an instant  profit of over  100% . The total price tag was $62 Billion dollars for assets that were bought  for about $29.6 billion.  Goldman Sachs got the lions share of that to the tune of $14 Billion of our money over a 14 month period.  Isn’t high finance grand when you can steal from the public with the permission and backig of the government? Just buy any garbage you can and if you lose money, hey, no sweat, Obama and the libs will make sure you’ll have a profit.

The Payoff

The reward that the Chairman of the New York Federal Reserve got for stealing your money and giving it to Goldman Sachs?

Well, well, well, you see, Goldman Sachs had just gotten a $5,000,0000,0000 ( five billion dollar) loan form Warren Buffet. We can’t possibly let Warren Buffet lose money just becasue you are unemployed can we? Of course not, if you ar unemployed and can’t give Buffet any money , why that’s no problem,  the government will just put your children and grand children in debt..while Obama, Buffet and Soros  and Gorelick and Geitner fly around in Air Force One. ( When the hell are we going to see the pics from inside Air force One anyway?)

OK back to the reward given to  the Chairman of the new York Federal Reserve Bank  for taking your and your children and your grand children money? Well, he became the Secretary of the Treasury, Tim Geithner!

Remember how the lib crooks and their lackeys in the media howled like banshees  whenever anyone questioned the logic of giving the treasury job to a crook who couldn’t even figure out his own taxes? Now you know why. It’s because he gave your money and your children and grandchildren’s  money to Goldman Sachs, Warren Buffet, George Soros etc. They in turn give the money to Obama and ACORN and you and your family have become surfs indentured to the Marxist left and their cronies in high finance.

Apropos, Buffet gets $500,000,000 ( five hundred million) dollars in interest  alone, every year becasue they stole your money to bail  out Goldman Sachs, but its OK becasue we get to hear how brilliant Buffet and Geithner  are.

The Backlash?

Fast forward to now, Goldman Sachs announces that the bonuses will not be cash and the media hails it as the second coming of Obama. Truth is that the bonuses will be astronomical and will be in stock. The future recipients of these bonuses are not worried about losing money if the stocks drop in price, they’ll hedge against that.  What worries them is what your reaction will be once you find out how much they made and they are especialy woried of what you might do  if the financial system collapses becasue of the Obama plan to cause the “golden crisis”. For that too they are finding ways to hedge, they are buying guns.

Yes that’s right Godlamn Sachs and co. are very concerned that blogs such as this one will put out the truth and you might have objections to quietly selling your children into serfdom so that Geithner can buy another Bently, and Jamie Gorelick can get another ten million dollar bonus  or Soros and  Buffet can buy another private jet and Obama can take his wife and kids on jaunts to Hawaii or New York. They are buying hand guns.  I bet with all that money they can probably get a very nice set of sequentially numbered Les Baers. Oh and just for the record, unless you are a Goldamn Sachs big wig ,good luck buying  agun in Mayor Bloomberg’s NYC – that’s reserved for the elites not for the likes of us rednecks!

You can see some of the Goldman Sachs Directors here

Dec. 1 (Bloomberg) — “I just wrote my first reference for a gun permit,” said a friend, who told me of swearing to the good character of a Goldman Sachs Group Inc. banker who applied to the local police for a permit to buy a pistol”

P.S.

Also I’m not sure on what experience the Bloomberg reporter, Amy Schroder,  is drawing her conclusion but yes a gun is in fact very useful if you find yourself in a home invasion situation. Over 2 million Americans find that out each and every year, hey Amy, why not do some “investigative journalism’ and ask them.

“Seeing no options left the Federal Reserve Bank of New York organized a bailout of $3.625 billion by the major creditors to avoid a wider collapse in the financial markets….The fear was that there would be a chain reaction as the company liquidated its securities to cover its debt, leading to a drop in prices, which would force other companies to liquidate their own debt creating a vicious cycle.”

Most of America isn’t even aware how close we came to a financial meltdown. No I’m not talking about the the ’07-’08 crisis, but rather the very stealthy one that occurred in late 1998 . Fewer still are aware of how the current Governor of New Jersey, John Corzine is alleged to have behaved during the crisis which threatened to bring misery and suffering to every person in America !

If you’re left scratching your head don’t worry , you aren’t alone and in fact the crisis was well covered up by media, after all how could they allow you the public to know that Clinton’s “economic miracle” almost came to an abrupt and sudden collapse and dragged the entire world down the drain. ( Of course the Dot-com collapse happened but by then the media could obfuscate the issue and blame Bush)

John Corzine, the head of Goldman Sachs  allegedly employed dirty  and perhaps illegal tactics as  tried to make a profit when the US financial markets teetered on the edge of the abyss

This rather obscure slide to the edge of the precipice occurred as the result of the demise of the equally obscure Long Term Capital Management fund.

The link above takes you to Wikipedia’s  a very adequate  synopsis of the fund and its short but significant history.

A few very notable things to know are that the fund was the brain child of one of the true financial innovators  of our era the legendary John Meryweather.

A very private man, Meryweather, is safe to say, probably has had as strong an impact on America’s and the world’s economy than probably any other living human being. Legend has it that while flying over the Midwest he came up with the idea of packaging individual mortgages into tranches and thus unleashing one of the most powerful financial instruments of our times the CMO ( Collateralized  Mortgage Obligation).  A very rough description of CMOs can be seen here and  the Wiki version here is generally accurate except that it doesn’t mention John Meryweather.

John Meryweather’s fund  Long Term Capital Management  (LLTC) was staffed by the brightest minds of the financial world at that time and it is safe to assume  some of them will be regarded as such throughout  history. Among them would be Myron Scholes, one half of the team for whom the “Black-Scholes”  option valuation model is named and Robert C.  Metron.   Metron improved upon the Balck-Scholes model which renamed the Black-Scholes -Metron model, became the basis for the two men sharing the Nobel Prize in Economics ( Fischer Sheffey Black passed away in 1995)

A quick note here to illustrate the clear and timeless wisdom of Fischer Black. In 1972 Mr balck wrote the following as a rebuke to the Keynesians of the time :

In the U.S. economy, much of the public debt is in the form of Treasury bills. Each week, some of these bills mature, and new bills are sold. If the Federal Reserve System tries to inject money into the private sector, the private sector will simply turn around and exchange its money for Treasury bills at the next auction. If the Federal Reserve withdraws money, the private sector will allow some of its Treasury bills to mature without replacing them.

The purpose of the John Meryweather’s  fund, Long Term Capital Management was to exploit discrepancies in the gigantic bond markets and reap the rewards afforded as the markets moved to correct these anomalies. Initially the fund returned huge profits with what seem like minimal risk. As other players entered the market and sought to get a piece of the pie the fund ended up putting on an ever increasing amount of  risk.  In 1998  LLTC faced  the “perfect storm” of investors dumping Japanese and European bonds  in the wake of the Russian financial crisis and illiquid  markets , due in part to the exit from the arbitrage business of Meryweather’s former employer Solomon Brothers the fund became insolvent .

Because the fund’s positions were so intertwined with the financial welfare of just about all the major financial firms on the planet and becasue the markets were already skittish due to the Russian financial crisis the Fed, correctly, understood that a haphazard unwinding of the Long Term Capital Management’s  positions would cause a worldwide financial collapse. To try to avoid this  disaster the Federal Reserve encouraged LTCM to find buyers or investors to provide much needed capital. One of the people to whom LTCM, and the FED, turned to was Meriwether’s former Chicago University Graduate School of Economics colleague and former employee, the then head of Goldman Sachs John Corzine.  Corzine had agreed to lend LTCM $1Billion dollars of Goldman Sach’s  own and its clients money and then it also agreed to help LTCM raise another billion.  The condition was, of course, that Goldman get a look at the trades and positions that LTCM had on its books at that time. That’s an absolutely normal request and it made sense that anyone looking to invest over a billion dollars would want to see what they’re buying.

This is when things got really dicey for LTCM and for the nation’s financial markets. As Roger Lowenstein in his book “When Genius Failed ” describes the situation , Goldman Sachs personnel descended upon LTCM like locusts and rifled trough LTCM’s files, “according to witnesses Goldfield [ a Goldman Sachs trader] appeared to be downloading Long-Term’s positions ..directly into an over sized   laptop. Meanwhile, Goldman’s traders in New York sold some of the very same positions. At the end of the day when the fund’s postions were worth a good deal less some Goldman traders in Long-term’s office sauntered up to the trading desk and offered to buy them. Brazenly playing both sides of the street [Corzine's ] Goldman represented investment banking at its ugliest” Source When Genius Failed: The Rise and Fall of Long-Term Capital Management

To put things in simple English, John Corzine promised that he would help avert a financial disaster that could drag the world into a massive collapse. Corzine promised that he would help fund LTCM and asked to see their books before writing the check . Nothing doing! As soon as they saw the books  the Goldman traders, allegedly, took advantage of the inside information they gained to make matters worse and make themselves and Corzine a lot of money. Here is Lowenstein again ” rumors that Goldman was selling LTCM’s positions in swaps and junk bonds were all over Wall Street. In fact its [ John Corzine's Goldman Sachs] high-yield traders were said to be bragging  about it” Source

Sure the transactions were complicated an lay people and Mom-and-Pop USA weren’t even aware how close to the  financial precipice we got much less understand how and why. The one thing however that we can take form this is that when history called on John Corzine to step up and be a responsible financier he chose to instead, allegedly, lie and cheat and line his own pockets- the country be damned. Is it any wonder that a man who would so quickly and so willingly push the nation into a financial abyss to line his own pockets would do the disastrous job that he has done as Governor of New Jersey?

New Jersey haven’t you had enough?

I can’t for the life of me justify having even the slightest concern about the “gap” between the rich ad the poor. It’s nothing but an idiotic concept the sole purpose of which is to induce jealousy and envy in order to incite class warfare. Assume, for example, that the wealthiest man you know is worth say a paltry $500 million dollars.  He opens a factory and gives you and two hundred others a job working  in that factory. You now have a job making say $40,ooo per year. You like your job and are content to try and make a career out of it.

Along comes the community agitator (where I was born they called them “cadre”)  who tells you and your fellow co-workers that in the past three years, as your salary went to $46,000, the factory owner’s net worth went  from $500 million to $520 million largely due to the profits made at the factory. Therefore, the community agitator surmises, the wealth gap went up , unfairly and even unjustly. While you have the good sense to kick the community agitator’s ass so hard his dead  ancestors taste  shoe leather, some of your co-workers agree with him and elect politicians to remedy the situation.

The politicians  impose taxes and tariffs and regulations and before you know it the factory goes in the red and shuts down. The owner loses $50 million dollars in the whole affair so he has less than what he started with and his net worth drops to $470 million. You and your co-workers are out of a job, but you are no worse than before you got the job.

The community agitator has probably hightailed it out of town before you can go and thank him for lowering the income gap from $500 million to $470 million.

Well, yeah it’s a story and not a realistic one at that, because you see in reality the community agitators don’t run and hide. They occupy the White House and the damn Congress and steal your money!

The Wall Street Journal reports that, like  Lenin and Stalin and the Bolsheviks, Obama and Pelosi and Reid and the whole lousy lot just  lowered the “wealth gap” as promised. “I’m glad you’re fired up!”

The deepest downturn in the U.S. economy since the Great Depression may finally shrink the gap between the very best-off Americans and everyone else.

If so, it won’t be by lifting up the bottom. It will be by pulling down the top.

Over the past 30 years, chief executives, Wall Street bankers and traders, law-firm partners and such amassed ever-greater incomes, while the incomes of factory workers, teachers, office managers and others in the middle grew much more slowly. In 2007, the top 1% of U.S. families accounted for 23.5% of all personal income in the U.S., according to economists Emmanuel Saez of the University of California at Berkeley and Thomas Piketty of the Paris School of Economics. That was a level not seen since the Roaring Twenties. Read article here

All that stupidity aside I just want to bring to your attention the fact that Peter Stark, Democrat,  thinks  that the debt of the country is “different than the debt of the individual”. This is a microcosmic summarization of the left’s attitude towards your hard work and the taxes that you pay. This is why they have no compunctions whatsoever with taxing you at over 50%  of your income and then spending it on such necessary items such as a museum display of Robert Mapplethorpe’s graphic photographs of homosexual acts.

Of course you could try to  ask Peter Stark, Democrat ,who exactly is it that will have to pay the country’s debt, but then you’d  have to lend him a brain cell so he can have a couple.

Now you might wonder why is ol’ Pete Stark so condescending and conceded on the subject of “graduating from a good school’. Well you see, its becasue Pete Stark received a Bachelor of Science degree in general engineering at the Massachusetts Institute of Technology in 1953. I’m sure MIT is looking for ways to spin that LMAO!

(And he says it all with such an unassailable air of authority about him)

“A suggested lesson plan that calls on school kids to write letters to themselves about what they can do to help President Obama is troubling some education experts, who say it establishes the president as a “superintendent in chief” and may indoctrinate children to support him politically…”

“But the White House says the speech is merely “designed to encourage kids to stay in school.” Source

“…It was his own fault, he knew. He should have kept his mouth shut like Dennis told him. All his friends had come and shook his hand and pounded him on the back. “That’s telling them , Adams!” they said. But their voices were hushed and they glanced over their shoulders as they congratulated him…”

“..And later, when the “volunteers” of the Green Ribbon squad kicked his ass all over the shower room, they had stood by in nervous silence, their faces turned away, their eyes averted, and their tremulous voices silent.

He sighed, Could he blame them? He’d been afraid too, when the squad walked up and surrounded him, and if he could have taken back those proud words, he would have. Anyone is afraid when they can’t fight back, he’d discovered. So they taught him a lesson, and he had expected it to end there. But then yesterday had come the call to Dr. Morton’s office, and the brief hearing that had ended his career at the university.

“Thomas,” Morton had intoned, “You owe everything to the State.” Thomas snorted…”  Read it here

“..Thomas Adams closed his eyes tightly as he relived those moments that had forever changed his life. Those shouts and angry accusations as the agents found no secret arms cache still seemed to ring in his ears. They had threatened him with arrest, and once he had thought the government agent named Goodwin would actually strike him.”

If you think that the answer is the American people your are dead wrong! Oh sure politicians can authorize handing out $4500 of our money,  be astonished that people want it and then declare the program a success.

The rest of us can think a little clearer and come out with an answer based in reality.

Government programs that only benefit a segment of society are always accompanied by unintended consequences adverse to the group that was initially targeted for assistance

As anyone who has ever read a book on Macroeconomics  has learned that any governmental action designed to benefit a targeted group of people in a  free markets environment  is doomed to have dire consequences on the vast majority of the people who were not given the same benefits. ( Of course if all the participants of a free market are beneficiaries of said government action then we no longer have a free market and instead end up with the “blessings” of a centralized economy)

Rent Control is a prime example

One such example is “rent control.” Here in NYC and many towns in NJ rent control is alive and well and a matter of much debate. Without getting into the details I will just give you quick sketch of the situation.

Rent controlled apartments benefit those who live in them. The tenants tend to stay in them for very extended periods and in fact their  “right”  to “rent control”   can be inherited by the tenants children. The result  is that those apartments ,two thousand, three, four whatever the number are effectively taken of the market and no longer available to be rented. The law of supply and demand tells us that when supply is lowered but demand stays the same or goes up prices increase.  NYC residents pay higher rent prices than they would in a free market because the City Government took action to benefit a certain segment of the city’s population.

If you doubt that prices would decrease if rent control was abolished just check out prices in Boston. That city has ended the practice of rent control and rent prices have lagged behind NYC. Further and more important the distribution curve of available apartments is much more leveled indicating more apartments available at lower prices as opposed to NYC. The NYC graph has a spike indicating that most of the apartments are the very high end of the market. The graphs show that  while rent control benefits a certain  segment those that it hurts the most are those unable to pay the sky high rents on luxury apartments thus hurting precisely the economic class that it aimed to help.

Black Markets and crime

As William Baumol told so many millions of us  us in our freshman year this kind of government action also results in black markets and the  criminal element also tends to benefit.  In  the apartment rent control racket there is an entire  black market who caters to providing such apartments to would be renters. For a price you get the apartment.

Why would anyone believe that dismantling yards, used parts dealers and God only knows who else will find a way to benefit form the cars that are supposedly “crushed”?  How much will we spend to enforce that?

Same thing is happening with used cars

The same scenario is now being played in the used car markets. This is  USA Today, quoting  Kelly Blue Book analyst,  Alec Gutierrez, “prices for used cars will go up as much as 10%!”

No surprise there, its just the law of supply and demand coming in on the heels of the “Cash for Clunkers” program.

“The United States used car market generated total revenues of $173.2 billion in 2008, representing a compound annual rate of change (CARC) of -0.4% for the period spanning 2004-2008.” Source

Using these figures, the Cash for Clunkers program cost the US taxpayer $3 billion dollars in initial outlay and then an additional sum of up to $17.3 billion dollars in price increases.

More to the point the price increases are most evident in the lower end of the used car market affecting the same cars that those who cannot afford a newer car will purchase. Once again the poorest among us gets shafted. Isn’t that just like all the other successful government programs?

Sure lets allow these same people to administer a the multitrillion dollar  health care industry. Why the hell not?

PS For a  great analysis of the rent control question check out Cato’s institute article on this issue here

Update

Note that the 8/13/09 retail sales numbers came in and they were dismal. many are blaming the cash for clunkers program on sucking funds form the rest of the industry and funneling them to the car companies.

Barack Obama said his $787 billion stimulus bill “has worked as intended” as he pushed back against Republican criticism that his recovery program has failed to rescue the economy.

Ahhem, gee Barry good thing you told us because in the real world there are  more unemployed workers in America than ever before in our history.
Since you are at it maybe have the TOTUS give a clue to Bidden because that ol boy says that you and your cabal “underestimated the economy”

You know most of us can’t quite figure that one out Barry. How can you and yours have underestimated the economy when you called it “financial meltdown” and “financial Armageddon” and the world will end and cats and dogs would have checkers tournaments? Either you didn’t’ believe what you were saying or you think that maybe you should’ve used stronger language. Maybe you should have said that the situation is the equivalent of “TWO CONSECUTIVE ARMAGEDDONS” after all two is stronger than one right?

Anyway if the stimulus is working clue in your Obamunists, including Bidden and Pelosi and al the rest who claim that we need a second stimulus.  Hey we all know that you can’t wait to get your hands on “whitey’s” money  but at least come up with another excuse, you know one where you libs don’t contradict each other  every other word.

OK so House Minority Whip Eric Cantor (R-VA)  described  the situation in a more media friendly manner.

Congressman Cantor ” said the stimulus bill was “full of pork- barrel spending, government waste and massive borrowing cleverly called ‘stimulus.’”

“The plain truth is that President Obama’s economic decisions have not produced jobs, have not produced prosperity, and have not worked,” Cantor said.” Source Bloomberg