Category Archives: Politics

Earnings Crush(ed)

Posted on by
Reply
Total Earnings by quarter Up Same Down $952.48 $972.31 $999.32 $983.51 $1,099.24
QTR Change % year over year 49.94% 810 45 767 -13.35% -10.39% -2.96% 3.52% 11.25%

Here’s the pivotal point I have been watching for on the economy.  Less than 50% of the companies listed in the Valueline Index made more money for their most recently reported quarter than they did one year ago.  And the steepness of that drop is severe.

For the most recent data I have, companies earned $952.48 on a per share basis.  That is down from the same period of a year ago of $1,099.24 on a per share basis.

The most recent quarter was also the worst of the last four quarters.

On average, the stocks made 13.35% less in income per share than they did one year ago.  This means that adding up all the stocks that made more than they did a year ago and all the ones that made less than they did a year ago, and the total is down a whopping 13.35%.

Do you think those businesses will be expanding for the rest of the year?  Or fighting for survival?

I have not seen this indicator of mine turn negative since the last recession.  It’s not a normal event, and it indicates that there is something wrong with this economy.

The regulatory and tax burdens faced by American businesses are crushing the bottom line.  Obamacare is crushing the bottom line.

The Federal Reserve, with rising fuel prices year over year, and low unemployment(thanks to a plethora of low paying part time waiter and bartender jobs) will have no choice to but to raise rates at least once more this year.

Those rate increases, which will affect the refinancing of the the debt that American corporations hold at record levels, will decimate the bottom line even further.

These are not one time or one off events.  This is the cost of doing business in the United States today.

Further compounding the bleak picture is the outlook going forward.

Dow 30 Profits Analysis 20160517

 

2012 2013 2014 2015 2016 2017 2021
Dow 30 Total Profits(millions) $347,711 $341,897 $351,263 $326,459 $319,660 $351,990 $469,760
Change $24,953 -$5,814 $9,366 -$24,804 -$6,799 $32,330 $143,301
% YOY 7.73% -1.67% 2.74% -7.06% -2.08% 10.11% 40.80%

Above is an analysis of the profits of the DOW 30 Industrials in total dollars earned.

The year 2015 was the worst  since the year 2011.  Adding icing to that cake is the forecast that 2016 will be worse than 2015.

The year 2017 will get us back to the performance we saw in the year 2014.  We have lost years of economic performance gains while the Federal Reserve Bank has constantly told us that we had an improving US economy.

Do the numbers in the table above appear to indicate that our economy has been improving?

Not even close.

The US economy is dead in the water, and is taking on water.  The forecasts for future years are way too optimistic in my view, and there is no economic stimulus available, other than reducing regulations and cutting taxes that will get this economy moving again in a healthy manner.

Prepare accordingly.

This Election Year Indicator Has Been Correct 9 Of The Last 10 Presidential Elections(and the 10th is Easily Explained)

Posted on by
Reply

We are seeing hundreds of millions of dollars spent on this year’s election. And a lot of money is being spent to predict what the outcome will be in the fall of 2016.

I have an indicator that has been correct 9 of the last 10 Presidential elections, and the 10th can be explained with relative ease: Richard Nixon and Gerald Ford.

Corporate profits after taxes, as reported by the Bureau of Economic Analysis has easily predicted whether or not the incumbent would win, and whether or not the party in power would hold that power going forward.

How is that possible?  Corporate Profits after taxes is an amazingly easy concept to understand.  It’s an overall look at just how the economy is doing.  After all, if companies are not growing profits, the people that work for these companies will experience the stress and duress of an unsteady economic environment. Continue reading →

What’s The Real Cost of that MARTA Ride?

Posted on by
Reply

MARTA is in the news a lot lately in Fulton County, as they push for more funds to expand heavy rail, especially in North Fulton County.  We are told of the benefits of MARTA, and one could argue that there are indeed benefits, especially for those that do not own vehicles.

MARTA is pushing today for a sales tax increase that would increase their sales tax revenues by 50%.  By doing so, Fulton County will be increasing the subsidies that are given for each MARTA rider.

But what is the true cost of of this Mass Transit system today, and where do the funds come from?  Is it a positive or negative expense when it comes to other modes of transport?

Only 22% of MARTA’s funding comes from fares.

Twenty-two per cent of MARTA’s funding comes from Fare Revenue, 58% from sales tax revenues, and the other 20% from other sources such as State and Federal government.  What would it cost if MARTA relied entirely on fares, and not on sales tax dollars,and federal and state dollars? Continue reading →

Rally Behind Trump and Destroy the Government Party

Posted on by
Reply

One after another, the politicians I think I could respect eventually show me their true colors and that they WILL CONFORM to to the hidden leadership of the Government Party (Democrats and Republicans working together behind closed doors) that none of us elect.

How does the Government Party maintain this control over the elected politicians?  The formula seems to be rather simple.

  1. As soon as a new person is elected, get them to toe the line or they will be given lousy assignments, their legislation(no matter how appropriate) will never see the light of day and your district or state will suffer the consequences of base closings and less federal dollars returning home.  Essentially “We will make you appear ineffective”.
  2. The sub parties of the Government Party(Democrats and Republican to you and I) will pressure the big contributors to cut you off and fund challengers if you are not a team player.
  3. Bully, threaten and coerce you to conform behind closed doors, and if that doesn’t work, they will do so in public.

Only a true outsider has a chance to stop that, and only from the White House. Why?  Those that are elected officials have already joined the Government Party.  Those that do not will take a verbal assault from everyone on both wings of the Government Party.

Think Sarah Palin.  Think about the assaults she still gets today from both sides?  Why?  She threatened everything because she did not win her State’s to[ job by playing their game, and if elected, that would have weakened the Government Party going forward.  Everyone in the Government Party knew it.

https://www.nolanchart.com/article4706-whos-afraid-of-sarah-palin-and-why-html

The frequent and persistent use of the Veto by the next President of the United States(POTUS) will be the ONLY thing that is effective.   It has to be used not with reckless abandon, but with clear determination to reform and reshape what the Government Party produces.

Will the Government Party work for months to get something passed that is clearly wrong for America(They do this all the time btw), and have it vetoed, only to have to work another month to override the veto?  They might do this once, twice or more.  But they will soon figure out that this game is changed.  The electorate (you and I) will know who is clearly going against the Constitution and the will of the people.  We will then have the clear reasons to send them packing.

There are only two ways to break the Government Party and its iron-fist of a hold on the throats of the American taxpayers and citizens: Top-down and bottom up.  Here’s the best chance we have had to change it from the top-down.   Bottom up will take decades.

Of the three outsiders Carson, Fiorina, and Trump, , which one do you think has the courage to say F you to that hidden leadership and their public faces? Because F you is what the American people are trying to say and they refuse to listen.

I think the answer becomes clearer by the day.  The one that they are all focused on daily.  The one they are trying to destroy.  The one that they tried to back into a corner if the Republican wing of the Government Party so he would not run as an Independent.

Yes, the one they are all trying to eliminate from the race despite the fact he is leading in their polls with a strength that they cannot replicate with other candidates.

Interestingly enough, they are also attacking the “insider” Cruz who just might be the strongest contender that is willing to defend the Constitution of the United States as it is meant to be defended.

I feel for the first time that there is a strong chance I will vote for Trump instead of the Libertarian candidate for POTUS, because he IS an outsider, and he will not play the rigged game.

Trump could indeed let us down.  After all, every insider that has made it to the White House has done just that.  One hundred per cent of the time.

If he does, we can quit fooling ourselves that this country belongs to us and acknowledge without fail that it belongs to the Government Party.

Stand your ground, America. We have had enough.

This will be our last chance to save the Republic.

Destroying the Government Party will give Libertarians the opportunity to be heard.

Destroying the Government Party will all our government to be returned to We, the People.

Destroying the Government Party will give us the chance to return to a real Constitutional Government with real checks and balances.

Leave the Government Party in place, and your children will never even understand what the freedoms we have already lost feel like.

It’s your choice.

Are you willing to wait for an insider of the Government Party to rise to the Top and make changes?  That will never happen.

Or are you willing to sound a clear and decisive shot at the Government Party that will break it into pieces?

If so, you know where your support needs to be.

Do it.

Seniority Rules (And Why Our System of Government Falters

Posted on by
Reply

In the halls of the Senate and Congress all elected individuals are not treated equally. Somehow this basic tenet of our nation’s existance does not apply to the elected leadership of this nation.

In fact, the system is so weighted that the two candidates that were vying for the Democratic nomination for President would not have been qualified to lead the Senate based upon these rules. I will also promise you that not one first term congressmen will have a shot at being Speaker of the House despite the dismal performance of the current Speaker. The most highly qualified individual will simply not get the job. And so, our nation falters. Continue reading →

MARTA: It’s Not About Racism-It’s About the Math

Posted on by
Reply

MARTA_trainSince the beginning of the Mass Transit era in the Atlanta metropolitan area, I’ve constantly heard the arguments that the reason people were against the transit system was racism.

This is usually the moment that the local politician or commentator makes the statement about how people feared that their homes would be broken into and their tv set stolen and taken away on a bus or train. It’s a tired example, and an inaccurate example. Continue reading →

Brace Yourself For the Slowing Georgia Economy

Posted on by
Reply

images_man_braking_car“Individual income tax collections for the month increased by 11.5 percent, while gross sales tax collections deposited during November rose a minuscule 0.2 percent. Net sales tax revenue fell by 1.3 percent.

Corporate tax revenues in November increased by $5.1 million.”

http://www.bizjournals.com/atlanta/blog/capitol_vision/2015/12/georgia-tax-receipts-up-7-5-percent.html

There’s what you need to know in a nutshell.

Gross sales tax collections rose only 0.2% in November.  Net Sales Tax Revenue fell by 1.3%.  That says recession.

In an economy that is based on consumption, consumption must outgrow everything else.

The individual tax collections will soon follow suit as well as corporate tax revenues.

If people are not spending more money, companies do not make as much profit.  Companies that do not make as much profit do not need as many employees.  Fewer employees means lower income tax collections.

The state of Georgia did pass a Billion dollar transportation tax earlier this year.  We have begun to see that impact.  Taking a billion dollars out of gross receipts and sending it to the state, rather than to the bottom line of companies and into your banking accounts as savings has a cost.

We will see that cost in full glory shortly.  The tax, however, will not be reversed.

What we will see is everything else blamed, from warm weather to cold weather, to the strong dollar to …..

The truth, however, is much simpler.  Governments that tax too much destroy their own economic engines.

 

World Economies: Stimulated Into Recession

Posted on by
Reply

jumping-frog-clip-art-hopping-frogDo you remember the science experiments you saw as a kid?  There are two that come to mind.  One is where the rats are stimulated via electrical impulses to do things?  Another is where the frog is dead, but when electricity is used to stimulate the muscles, the leg moves?

That’s where I see us economically today.

Financial websites are awash in conversations this week about all the recessionary signals we are seeing.  The Federal Reserve is meeting this week.  Expect nothing of significance.  From Zerohedge to the Wall Street Journal to David Stockman, Peter Schiff, and others, the headlines are ll the same

The Central Banks just do not get it.

There are many people who will also tell me that I just do not get it.  But I think I do.  And from local issues to international issues, there is a common thread that runs through them all.

Economic opportunities are drying up.  Sales are declining.  Profits are falling faster than than the leaves on the trees.  Central banks around the planet are trying not to panic but they are ready to.  They cannot get things moving forward whatsoever. Why is that?

If you step back for a moment, ask yourself what was the original point of all that the Central Banks hoped to accomplish with their policies?

Stimulate. They wanted to stimulate someone to do something today that they would not have had the money to do so until tomorrow.

raining-money

QE programs have left the planet awash in money . Economies are receding anyway.

They wanted to generate demand.  Who is “they”?  It’s not just Central Banks.  It’s the Federal Government.  It’s State Government.  It’s Local Government.  How do they accomplish this stimulation?  They are raining easy money anywhere and everywhere.

Stimulate Stimulate Stimulate

But it’s not that simple.  They pulled demand from tomorrow into today.  Then they pulled demand from next month into this month.  And when that was exhausted, they pulled demand from next year into this year.

Everyone everywhere all stimulating and pulling future demand into today.

You get the picture.

And then BAM!  We hit the wall when we got to the future where that demand was from, and there was no demand left. There is no future demand to pull into today..  A vacuum exists. A really big vacuum.  And today that vacuum is like none we have ever seen.

That vacuum, which cannot be filled by magic, will have to be endured.  Unfortunately, they do not believe this to be the case.

There are ways to lessen that vacuum, but that will not happen either.

Reduce and eliminate rules and regulations.

Cut business taxes dramatically.

The Powers that Be will never let that happen.

They continue attempting to stimulate and show us that things are great.

Yet the economic numbers(which clearly have an upward bias) paint a very different picture.

I have a unique spreadsheet that calculates a weighted per share performance from companies that are followed by Valueline.

While we still have 56% of the companies reporting higher profits than 1 year ago, overall for all the companies, profits are now down 2.31% for the most recent quarter.  The same quarter last year was up 7.84%.

That’s a very large drop for an economy that is supposed to be gaining speed.  No wonder the Federal Reserve is afraid to raise interest rates even 1/4 of a point.

And so we wait….

We Said This Day Would Come

Posted on by
Reply

Recently, I was at a restaurant and ordered a salad.  Being Gluten-free, my options are generally limited.  $10 for a salad I could make at home for $3 was ok.  After all I was at the beach.

I asked to have some chicken added.  Informed they cannot do chicken, but they could do shrimp.shrimp

“How many would you like?”, Alex asked.

I could smell the ocean from where I sat. “Six is good”, I replied.

A few minutes later, Alex came back to the table, and said “Just wanted to give you the heads up that the shrimp are $3.50…..each”.

How does one keep a straight face with that sort of news?  Better yet, how does one not laugh hysterically?

How do I keep a straight face as my friends watch what I might say.

That’s the way I felt when I got home and opened my Blue Cross rate letter for 2016. They are careful not to place you current premium anywhere for the sake of comparison.hair_0

For the record, I have not made any progress towards my $5500 deductible for the current plan year-I have not been to the Doctor for any reasons.

That’s what makes it even more shocking.  My premium has gone from $273.31 to $497.01.

Yes, you read that correctly.

81.84%blue-growth-chart

Here’s a calculator you can use as well.  Depressing, isn’t it?

http://www.marshu.com/articles/calculate-percentage-increase-decrease-percent-calculator.php

Obamacare:  The Gift that keeps on taking.

We said this day would come.  We said rates would rise sharply. No one believed us.

And now here we are.

If you want to know what is killing this economy, look no further.

Blue Cross wants to collect nearly $2,111 from me for doing…..absolutely nothing.

Had Blue Cross been actually concerned about my health, they would have told me to sit down before opening that letter.

And if I were smart?

I’d still be at the beach. But I would get my own shrimp.

I am also changing to a Medical Cost Savings plan.

My monthly contributions will be LESS than the increase that BCBS is asking from me in 2016.

To be a bit more precise, it will be 40% less than what BCBS wants from me.

And my new deductible? $500.

With that kind of savings, I will be able to head to the beach sooner rather than later.

You should explore those sort of options as well.

After all, it is YOUR money.