Rand Paul’s Falling Behind-Is There Anything That Can Be Done?

rand paulRand Paul faces a series of major decisions. He has lost the edge he came into office with. His positions are dulling as he listens to advisors that tell him he needs to be more inclusive. WRONG WRONG WRONG.

Paul needs to be so clear on his positions that anyone(and I mean anyone friend or foe) knows where he stands and what his reply would be.

Rand has made some critical mistakes along the way. But he is still young. Let’s see if he can learn from them and correct his course.

Here are three things I suggest he do immediately:
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1) Apologize for supporting McConnell

Let’s face it. This was a mistake. Rand showed us that his loyalties were to the party and a fellow Kentuckian, even if that Kentuckian was wrong for America. And since then we have paid a heavy price for this choice. Rand could have had another ally in the Senate had he not supported McConnell.

2) Take a hard line on the border and illegal immigrants. Libertarians support an open border ONLY if crossing it does not come with food stamps, welfare, housing and medicare. Crossing the border into the US should not mean you get all the perks of citizenship.

Donald Trump has shown clearly that this is the single biggest issue we all have at this moment. We have been told for decades that something would be done. It hasn’t. The needs of law-abiding citizens are secondary to the wants of illegal aliens. And we are being bullied from all directions that we must accept illegals. We do not. If your native country sucks, I am sorry. But it’s NOT my problem.

3) Start attacking the Fed. The Fed has painted themselves into a corner. We are screwed. If you cannot make the most of this opportunity, you never will.

We are on the cusp of a major economic event. The Fed is at the root of the problem. It’s going to be hard. But we must remove our economic outcome away from the idea that printing more money, and borrowing future demand to shore up businesses today is the answer. Our future is dismal if we do not act soon. It may very well be too late. But Paul can boost his standing by continuing to highlight the mistakes the Federal Reserve is making(and who is getting rich on their coattails).
End the Fed

Rand has decide where he stands if he wants us to stand with him. As of now, I think he is trying to play both sides. I am not sure where he stands.

That will be a fatal mistake to his campaign. There are 15 flavors of vanilla being offered by the Republican slate. And then there’s Trump. Rand needs to show what his true flavor is.

Paul has potential. He has shown courage. But he has faltered over the last twelve months. I suggest he pause and look around. Are those advising him of what he needs to do palying inside the box? Or are they thinking outside the box?

This game will be won outside the box. So why continue to play inside the box?
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Introducing the Fulton County Residential Authority( Or Why We Should Not have the Fulton County Development Authority)

I’d like to propose (for illustration only) a new agency for Fulton County.  We will call it the Fulton County Residential Authority(FCRA).  This authority will do for residents what the Fulton County Development Authority(FCDA) does for businesses.

Fulton County needs to attract some of the best and brightest residents out there who are looking for new homes.  There are many attractive locations, and it would be in Fulton County’s own best interest to attract them here.

We can attract them by helping them get the financing they need for their homes.  We will help them to float bonds for their residences, and offer tax incentives for those that are willing to purchase those bonds.

thankyouCurrent residents that are already in their homes?

We will offer you a hearty thank you. Thank you for not questioning our actions.[read more=”Read more” less=”Read less”]

Thank you for continuing to pay the full taxes on your property.

Thank you Thank you Thank you.   (If you are one of our valued residents come in and chat-we may be able to work a favorable deal for you as well)

We will also offer through the FCRA property tax breaks for you that will lower your cost of residency during your first ten years.  We will lower your property taxes by 50%, and then slowly increase your taxes over the years.  And if needed to keep you happy, we will work with you to help lower those taxes in other ways as well.  We are here for you.

thankyouCurrent residents that are already in their homes, and paying the full tax rates without any abatements-once again we offer you a hearty thank you!

 

 

 

Once a month, the FCRA will get together and look over the list of those who have applied for an inducement to have their residence within Fulton County.  We will be evaluating you based on what you say will be the benefits of having you here.

Are you a high income earner and will be spending dollars?  There’s a plus.

Going to be hiring a maid and lawn care and nannies?  Babies on the way? Greater purchases of goods and job creation is always a plus.

Building a new home versus a resale?  Even better. Raw materials purchased.  Building permits and inspections.   More jobs.

So we invite you to apply.  Make your case.  Help make Fulton County a better place for all.  Your FCRA will make the right choices picking the right new residents for Fulton County.

Crying-baby-cartoon_0For those current residents who will be living besides our beneficiaries of the FCRA, do not be concerned, upset, or feel cheated.  These new residents will add value.  They are bringing in new construction projects, jobs, and other intangibles.

We assure you this will not lead to overbuilding or speculation in our markets.  Do not look at these new residents as getting a tax break at your expense.  Look at it as incremental revenue that we will spend on behalf of everyone.

Let’s create the FCRA and do for residents what we are doing so well for our business community!

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Now that you have a sense of how the Fulton County Residential Authority might work, you can see why I would oppose the Fulton County Development Authority.

It picks winners actively and losers passively.  Current businesses pay more taxes than those that make deals with the FCDA.

It encourages speculation and overbuilding.

My list is long as to why I think the FCDA is a bad idea.  Despite the fact that “everyone has or wants a development authority”, it artificially stimulates demand for commercial space.  It also comes with a price: Property Tax Abatements.

Treat everyone and every business equally.  If the idea is accepted that lower taxes stimulate(as the FCDA can affirm by why it does what it does), then lower taxes across the board for EVERYONE.

Lower business taxes for everyone.  It’s the only equitable way to do business.

If you create a business environment that benefits ALL participants then that is the single best thing you can do.

Do not penalize current businesses by giving newcomers better deals and tax breaks.

It’s just that simple.

If you create that sort of environment for your businesses, you will not have to “induce” them to be in your community.  Instead, they will beat a path to your community, and everyone will benefit.

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Heading Closer and Closer to the Recessionary Wall

Much of the financial information we get on a daily basis tends to shape our perspectives of how the economy is doing.  Unfortunately, much of that data tends to be a first pass WAG (wild-assed guess), which has often proven to be more wrong than right.

Take the the numbers for job creation, which are released monthly by the BLS, for example.  They are definitely NOT rooted in reality.  But what happens is when the revision for a month comes out, the attention is focused squarely on the new WAG for the most recent month.

Other economic numbers of varying degrees of significance experience similar releases, and are also, more or less WAGs.

I have, over the course of the last 10 years, been working on a different approach, although it lags the headline grabbing urgency of a July number for job creation, for instance.  No, instead, my numbers crawl along slowly, three to four months behind.  But they are clearly superior.  I do not give you false hope with WAGS.  I do not sound false alarms with WAGS.  I also do not have to provide seasonal adjustments or other economic tricks.  I have no reason to inject bias into the numbers.  They are what they are.

While many economists also love to focus on top line growth, I have been dissuaded from putting too much importance on that line.  Instead, it’s the bottom line growth that drives the US economy forward in the long term.  This line is where the dollars come from for new expansion, new pay increases, new product development: the keys to real growth.

And unfortunately, the news I have to share is not positive.

Per Share Profit Growth

 

Here is a chart depicting the rate of profit growth year over year for the last four quarters on a per share basis for 1625 companies I track.  So, had you owned one share in each of these companies, one year ago and today, you would have seen your earnings grow by 5.27%, down from 8.40% a year ago, and 34.64% four years ago.[read more=”Read more” less=”Read less”]

One must keep in mind that Valueline drops companies that are heading in the wrong direction and add companies that are headed in the right direction.  So this data tends to have a natural bias towards the better businesses overall.

What’s going to be the stimulus to returning businesses to higher profit growth?

I simply cannot come up with any ideas that might be able to do it.  I can tell you what is working to drag profits even lower.

Higher interest rates.

Higher tax rates.

More regulations.

Increases in minimum wages in various locations.

Continued implementation of Obamacare.

So, we are at a junction where things need to get better but can’t.  Where will that send us?  What happens next?

Once the lack of growth in the chart above is acknowledged, the joy of owning stocks will become a fond memory.  Those stellar returns since the last bottom will disappear faster than the vapor from that E-cig your kids are smoking.

This recession will be unlike the last one.  The Federal Reserve cannot cut rates.  Too many businesses have taken on too much debt to buy back shares at their peaks (they should have been selling shares at the peak).  Companies used to be in the business of issuing shares to expand their businesses.  Today?  They borrow dollars to buyback shares to make their earnings per share look good.

Meanwhile the total profits of the Dow 30 will fall by 9% in 2015.  But fear not.  Their per share numbers look better than should.

States with the most issues financially have been able to mask the smell of their stinking liabilities so far.  But that gig is nearly up.  Puerto Rico is a hint of things to come.  Chicago is not far behind.

I suggest you prepare for the downturn which is coming.  Many of us were able to grin and bear the last downturn.

This one…well it’s gonna hurt.

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