War of Words

There was a lot to not like about George W. Bush. For example, he would chuckle mid sentence for no apparent reason, he often used the syntax of a hillbilly, and overall I just felt like he had no idea what his job description entailed.

That being said, looking back there was one thing I can honestly say I miss about George W...........ignorance was bliss. I read recently that in his 8 years as President of the United States he appeared on television less times than Obama has appeared in his first year in office.

Now let me stop right there......I have one giant concern with that......who is running our country? After all, those press conferences, speeches, Sportscenter, The Tonight show, The Late Show, etc......take time. Ever sat through the taping of a 30 minute sitcom. If you have you know that it takes ALL day. It is one of the most grueling experiences that you will ever endure.......and that is only a half hour sitcom!!

So our President is a Narcissist. It is America, and we all tend to get caught up in appearance and fame. So I will give him a pass on that one.

However and more importantly........when your face time, which is taking away from the job you should be doing, is being used almost exclusively to air dirty laundry, point fingers, bad mouth fellow politicians, the FED, banks, Wall Street, and Health Care providers. That is where I draw the line. Can you imagine if Steve Jobs came out tomorrow on prime time television talking about how incompetent the board of directors over at Apple are..........about how his creative director is making way too much money and how he has this great new idea that they are too stubborn and stupid to grant him permission to move forward with. What would happen next? I imagine the stocks plummets, The board and high ranking employees come out to defend themselves and slander Steve Jobs right back, the shareholders revolt, and a couple dozen people minimum lose their jobs.

The difference between the two? Steve Jobs isn't foolish enough to make such comments. Sad.....considering the argument can be made that the United States is much more important that Apple.

One last note: Have you ever given your dog a treat for going to the bathroom on your carpet? That's crazy right? Well that is essentially what just happened with the passage of the Heathcare reform. Let me be the first to welcome you to the new world of politics ladies and gentlemen.........public slandering has been proven effective and is here to stay! We have just entered the next stage of reality television.........

Discounting the Discount Rate

So by now you have probably heard the big news. The FED unexpectedly came out and raised the discount rate last week. As a repercussion........the market panicked, homeowners everywhere dropped their head in disgust and I even saw a couple Realtors with a case of the "lip quivers". So what now.........are we destined to succumb to rising rates, falling home prices, and on a more positive note, CD's yielding higher than a .05% return?

Don't get ahead of yourself. Go ahead and put down the stiff drink and call off the relocation to Canada for now. The discount rate increase will impact your life about as much as a fly getting a cramp in its wing.......in Africa. I'll even go as far as to say that if you are a frequent traveler to Africa I might even be overstating things. The discount rate is essentially the rate at which the banks would receive funds from the Central Bank. In normal economic times these are overnight loans. In times of turmoil........2008 for example, these loans were given up to 90 days to be paid back at a 0-.5% interest rate, depending on when in the last three years we are talking about. Which the banks, of course, would then turn around and invest in our Businesses and individuals right?

Yeah, not so much........that might have been the FED's intention but.........what happened more recently as things calmed down was that banks were utilizing these "overnight" loans to invest at their discretion for large interest returns. There were some banks making twice to three times the interest income that they did in prior years. We are not talking about hundreds or even millions, think hundreds of millions.

Let me stop right there and say, I personally find it completely shocking that the bank would exploit, for gain, our Central Bank and Tarp (aka taxpayer funds) for personal gain without any regard for the best interest of the United States and its account holders and consumers. Just shocked.

Am I laying on the sarcasm thick enough? So if you were wondering why the banks earnings looked so good by the end of the year when we were talking financial Apocalypse in March........there you go. But, that being said, unless you are a major shareholder in a bank, it really shouldn't affect your life one little bit.

However, be forewarned the day of reckoning is coming. GDP is rising and money is still flying off the press in DC. So rates will be rising......just hopefully later than sooner.

Okay, now you can commence with that stiff drink......