DUBAI AND U.S.

Fresh off a day of binge eating and holiday frivolity, America is waking up to the stark reality of the financial crisis that just won’t go away, and an administration that seems is in total disconnect between its ideology and economic realities.

Dubai World, the city-state owned corporation of Dubai, announced that it was seeking a 6 month extension to repay its bonds. Translated: it defaulted. It owes approximately $80 billion. Okay… what does that have to do with us…and U.S.? Well, if you are reading this, most of you have seen the pictures of those gorgeous buildings built in the middle of the desert on the Arabian Peninsula. If you are golfer, you have seen Tiger Woods play golf tournaments on Dubai’s green oasis golf courses. If you are a musician, you know that this is where Michael Jackson went to recover from his child molestation charges. That’s Dubai.

The Dubai government, with no oil of its own, attempted to build an Arab financial center on its little piece of heaven. Seriously, it was admirable effort to develop a pro-western financial center in one of the hot bed areas of the world. Although it enforced strict Muslim rules for its residents, guests were isolated in very pro-western luxury. It, indeed, is a beautiful city.

But it was built on borrowed money based on the overall influx of petrodollars into the region. The near financial collapse of the West in 2008 extended to Dubai as world credit markets froze, and have only partially and stingily thawed. The good times stopped rolling here, and they stopped in Dubai. One newspaper reported several months ago that the Dubai airport had thousands of abandoned Mercedes. Folks just drove the airport and flew off.

Although it sounds like a lot of money, the Dubai default is relatively small, but it has major implications. First, nobody knows who holds the bonds. Second, credit default swaps (bond insurance) exist Dubai bonds, and nobody knows who issued them. So far, it appears that European banks and financial institutions will bear the brunt of the losses. Asian banks also appear to have substantial exposure, although they have initially denied it. I wouldn’t be surprised to see Citigroup and AIG, the two largest American bailed out financial institutions, have exposure. It just keeps getting better.

The biggest risk to the fragile world markets is the fear of another credit freeze. The recovery since September, 2008, has been tenuous at best. The Obama administration, rather than concentrating on economic recovery, decided to push an ideologically based health care initiative and cap and trade garbage legislation. Not a good thing when the United States is awash in debt, with that debt growing geometrically each day.

In the meantime, Obama is out playing golf on a regular basis. He hosted a gala state dinner with Michelle dressed in a gold gown that was gorgeous, but a tad out of touch when people are banging on food bank doors in record numbers.

I doubt if the Dubai crisis will have long lasting effects other than a short term, but painful, blip on the radar screen. But the fact the blip is there at all should be a wake-up call to the Obama administration. Mr. Obama, please concentrate on getting our fiscal house in order. Leave your left wing politics for another day.

Government Health Care and Breasts: Do You Get It Now?

In a stunning example of things to come under the proposed Obamacare legislation, a government/medical task force has concluded that women under the age of 50 do not need mammograms, nor should they be taught how to do a self examination of their breasts. Such things are worthless and too costly.

Is there any more blaring example of what government will do to our healthcare? Can you imagine over 130 government bureaucracies determining not only whether women should receive breast exams, but whether men should get PSA exams, or prostate exams, or whether colonoscopies are necessary under the age of seventy; then to have these decisions enforced by coercion directed at what will be left of the private insurance industry, and be outright refused if you are under a “public option” plan.

Sarah Palin warned about death panels. People laughed. This is what she was referring to; panels of bureaucrats, sitting around looking at statistics and cost effectiveness of procedures. Who is too old for a hip replacement? Who is too old for cancer medicine? Lives saved from mammograms as a percentage of women aged 30 – 40 is not worth the expense of paying for them. Do you get it now?

According the government panel studying the cost effectivness of mammograms, they produce too many false alarms in women under 50. My question is, what about the ones that don’t? Those women would be dead. The study is framed in terms that mammograms cause more bad than good with unneeded biopsies. What they really mean is that the expense of the false alarms doesn’t outweigh the lives saved by the procedures.

Who determines where that line is drawn? Are 10% of the biopsies being positive sufficient to justify the mammograms? Is it 30%? Is it 50%? Who is the judge? Appointed bureaucrats with no political responsibility to anybody are the judges. Let me introduce you to the death panels.

Here is what the American Cancer Society said in response: "The task force advice is based on its conclusion that screening 1,300 women in their 50s to save one life is worth it, but that screening 1,900 women in their 40s to save a life is not. (They are) essentially telling women that mammography at age 40 to 49 saves lives, just not enough of them."

This is just a taste of what is to come if government starts to dictate what constitutes our health care. America…beware!!!

Coming Soon: The New York Terrorist Trials

Khalid Sheik Mohammad (KSM), the mastermind of the 9/11 attacks, and the executioner of Daniel Pearl by beheading, will be moved from Guantanamo Bay (Gitmo) and tried in New York City. The news was announced by United States Attorney General Eric Holder. Several other Gitmo detainees will also stand trial in New York. Once again, as in all things Obama, ideology triumphs over common sense.

To be honest, my feelings are mixed. It certainly has degree of poetic justice that the 9/11 guru be brought to New York, the scene of the crime, to stand trial. It has the possibility of being cathartic. The country is still feeling the after-shocks of the World Trade Center attacks. Many of our current economic ills can be traced directly back to September 11, 2001, and the subsequent flooding of the world economy with dollars and cheap money causing economic bubble after economic bubble; and ultimately the near collapse of our financial system.

But I suspect that this decision was purely ideologically based, and as in all such decisions, has a high risk of being a complete disaster. Several of the issues are practical. There is no doubt in my mind that there will be a circus like atmosphere surrounding the trial. It runs the risk of focusing terrorist attention on New York City, and I fear NYC runs the risk of new terrorist attacks during such a trial. It puts KSM right smack dab in the middle of our prison system, where disaffected prisoners can fall prey to his propaganda, and become activists upon their release from prison.

Legally, KSM will now be afforded all of the Constitutional rights that we enjoy. He will be given the best legal defense money can buy at the taxpayers’ expense. And those high priced lawyers will do Eric Holder’s, and Barack Obama’s dirty work, in delving into perceived Bush missteps, like claiming the charges should be dismissed because any information derived came from water boarding. You can’t even fathom the issues surrounding classified information that KSM’s lawyers will demand. The possibility exists, although small, that KSM may walk.

And don’t be surprised if you see many of Obama’s supporters from the far left hope for that very result. In their eyes, the United States, and particularly George Bush and Dick Cheney, are the enemies. They would be far more interested in embarrassing the United States and the previous administration than convicting this piece of vermin. They have twisted view of life, and they will be unable to contain themselves.

I have a real bad feeling about all of this.

Pelosi Health Care: Lessons Unlearned

Watching Nancy Pelosi gleefully parading her 2000 plus page House health care bill made me literally sick to my stomach, especially in light of the overwhelming public opposition to this type of bill. Do you really think that any government bill consisting of 2000 pages will result in anything good for you?

It is a left wing socialist’s dream. They aren’t even trying to hide what it does anymore. Even the left wing media agrees it does the following

1) It cuts $500 billion from Medicare. Do you really believe they are going to cut that amount from fraud and waste? My God! If they haven’t done it yet, it can’t be done. What they are going to cut is services and medical procedures to seniors. It eliminates Medicare Advantage programs. That is a direct increase in costs to seniors and their proverbial fixed income. It points those folks to AARP insurance, which will charge the seniors substantially more money for a less comprehensive supplemental policy. That is a fact.

2) It will force all citizens to purchase a health care policy, and not the catastrophic type of policies that are attached to health savings accounts and are affordable. No, you will have to buy one of the Pelosi defined policies, and will cost between $3,000.00 and $5,000.00. If you don’t buy, you get fined, or worse, go to jail. This will affect primarily young people. That is a fact.

3) It will raise premiums and taxes on everyone else in between, not to mention cut services. Don’t believe them when they say otherwise. Do the math. If you are able to maintain your insurance, you or your boss, will pay much more. Most likely, your employer will eliminate the policy, and you will be forced into the public plan that Congress says is so wonderful yet won’t use it for themselves. They are sticking up you’re a--.

4) It requires at least one plan to pay for abortions. That, in turn, is funded by a surtax on your premiums for the public plan.

5) The Congressional Budget Office has said that this will insure at least 2.5 million illegal aliens. There is no enforcement mechanism to prevent it.

6) The Cost Effectiveness Board is still in place. This will determine whether or not you are too old to receive the best treatment available. Folks, this is the real death panel.

7) It creates over 130 new government bureaucracies. Who do you think is going to pay for all of those new government employees? And if you think they can do such a great job at handling your health care needs…try to get a flu shot.

I never thought I would see this day where a small cabal of leftists, making up about 20% of the population, hijacks our country.

The leftist leaders in Congress and the White House are ignoring the lessons currently being taught in New Jersey and Virginia. There will be hell to pay for Pelosi, Reid, Obama and Democratic Party in the next election, unless they try to stack the ballots, which is a possibility. That is how they operate. But read the article written by Fred Barnes on the main web site, and truly try to understand the consequences when the government ignores the wishes of the majority of the population in pursuit of ideological purity. It leads to tyranny, and to violence.

God Bless America.

Leave the Damn Kids At Home!!!!!

Okay! Okay! I can hear the groans and read the comments already. But I have reached the end of my tolerance. My nerves are shot. My stomach is tied up in a knot. I have had it with parents who insist on bringing their little darlings to everything. Please. Leave the kids at home. Enough already.

Call me Scrooge…but I have had enough…especially in restaurants that are not designed for kids. Here is a news flash. No two year old wants to sit at a table while Mommy and Daddy eat expensive food and drink and talk on their cell phone. Of course the crumb grinders will be crabby. THEY ARE TIRED AND SHOULD BE HOME IN BED!!!!!

A white table cloth restaurant is no place for a kid on a Saturday night at 8:30 PM while people at adjoining tables are spending in excess of a hundred bucks for nice, adult night out. What are you thinking?

Modern parents seem to live in their own little world. When I was small, my parents called one of my cousins in to babysit me when they went out. When my son was small, we took him to grandma’s or hired a kid to sit for an hour or two while we went to get some peace for ourselves. If we couldn’t find or afford a sitter…or it was going to be a late night…we stayed home. It’s part of being a parent. It's called R-E-S-P-O-N-S-I-B-I-L-I-T-Y!

Not today. A case in point was this past weekend when my wife and I went to a relatively expensive restaurant to have Saturday night dinner. We were shown to our table, and immediately to the left of us were Mom, Dad, and a two year old little girl. Mom was drinking her wine and talking on her cell phone. Dad was trying, and failing, to keep this obnoxious little kid occupied by throwing her up in the air and traipsing her around the restaurant. This was an adult establishment, with average menu prices of 30 – 40 bucks. What could possibly be on the menu that would interest this poor little girl? While she screamed and carried on, and Daddy tried to shush her…Mom continued to drink and talk on the phone. It took just a few minutes for me to arrive at my breaking point, patient though I may be, and we paid for our drinks and left the restaurant, advising the management I hope the little darling would spend as much money there as we would!!

This is a problem generally in our society. Whether it is in movie, or grocery stores, or the theater, or church, it isn’t the kids fault. THEY ARE KIDS. Mom and Dad, you chose to have your children…stay home and take care of them!!!!! Did you not think that the little ones would crimp you social life? They do!!!!!

Today at lunch, Mom and Dad were several booths down from where I and my associate were sitting. Their little adorable two year old carried on, and I mean at the top of her lungs, for almost 15 minutes. It was clear the little girl was tired and needed a nap. The parents were oblivious. “Now, honey, let’s behave!” “NOOOOOOO” “Now honey, let’s be quiet!” “NOOOO!!! I DON’T WANT TO EAT THAT!!! AAAAAAA!” Ad infinitum.

Finally, I turned around and gave the look. I said “Jesus!” The mother snipped at me that the little girl was only two. “That,” I responded, “is exactly the point!” They left in a huff yelling at me that I hoped I enjoyed the rest of my lunch. I did. It turns out the mother was related to one of the waitresses in the joint. Too bad!!!

All kids are going to misbehave at some time, and I have no problem if the parents attempt to do something about it, like put down their cell phones and booze and take the kid outside for a walk. But I have come to the conclusion that the management of these places has to take a stand after a period of time of unacceptable behavior by unruly children with ignorant parents. Other patrons are spending their money too. So I have decided to let them know my displeasure. Will they say I grumpy? Will they call me a mean old man? Will they say I am a curmudgeon? You’re damn right they will. But you know what? At least I will enjoy my hamburg!!

Please address all hate mail to Barack Obama. And thank you for your support!!!

Lay Down With Dogs, You Get Fleas!!

The health insurance companies are learning a hard lesson. You lay down with dogs, you get fleas. What were these guys thinking? For those of you who have only been half following the health care debacle, our stalwart health insurance companies thought they made a deal made in heaven, and it turns out they made a deal with the devil.

When President Obama took office, he made it clear that health care reform was a priority. He immediately tried to build a consensus as to what that reform would look like, and went straight to his view of the problem sources. He went to big Pharma, and told told them if they went along with his proposals he would make sure that Americans would not be allowed to go to Canada to buy cheaper drugs. He went to the doctors, and told them he would stabilize their Medicare reimbursements, or alternatively devise a payment plan that would not decrease their income. He went to the seniors, and told them he would lower supplemental insurance premiums and reduce the drug “donut hole” and not Medicare benefits.

The health insurance companies were lulled into an Obama alliance baited with a huge, new source of insurance customers: those younger than 30 years old that typically don’t carry health insurance. It was to go something like this. Obama’s health care reform would require the insurance company to insure folks with pre-existing conditions at normalized insurance rates that would follow “government guidelines.” In exchange, the government would require everyone to carry insurance. The increased insurance pool would cover the costs of those with pre-existing conditions.

To make it work, Obama told the insurance companies he would be some teeth in the mandate. If you are 21 years old and don’t purchase a government approved insurance plan, you would be fined up to $2,100.00 and face a possible jail term of a year. Oh boy!!! How do you think that went over with those peaches and pie faced young people who chanted for hope and change during last autumn’s election? You got it. It didn’t. They were for hope and change as long as it didn’t cost them anything.

The proposed Baucus Senate plan contained the above mandate and the associated enforcement mechanism. That lasted, however, for about a day when wussie Senate Democrats recoiled in fear of what their constituents would do to them with such a mandate. All of a sudden, the “teeth” part of the mandate dropped from $2,100.00 to $100.00.

So as the plan currently stands, anyone can go in and buy insurance at any time. That means you don’t really have to buy it until you need it. Simply pay the IRS $100.00 and fuggetaboutit. If you get sick, you can always go and buy the insurance as they wheel you into the emergency room…kind of like waiting 'til your house burns down to buy fire insurance.

The insurance companies were aghast that the Senate reversed Obama's promises to them. In a very public move, they presented a Price Waterhouse study showing that it would put them out of business!!!! Do ya think? You don’t have to be a CPA to figure that one out.

But Obama doesn’t care, because that was his plan all along. Now the insurance companies, and the doctors, and the seniors, and the young people are going to learn life’s number one lesson. There is no free lunch. Somebody has to pay. And it is not sitting well with any of these folks who laid down with a dog, and got fleas.

NOT YOUR FATHER'S BUSINESS CYCLE

I listened to a financial analyst on CNBC this morning who kept talking about where we are in the business cycle. In the normal business cycle, unemployment keeps going up even after the recession is over. In the normal business cycle, corporate profits pop due to layoffs and efficiencies imposed by companies. “In the normal business cycle…in the normal business cycle…in the normal business cycle...”

I tried to follow what the guy was saying. In “normal” circumstances he would most likely be correct. But we are not living in normal times, and any economic recovery will be tenuous at best, if it comes at all. The rules of capitalism have been breached. The invisible hand of economics has been severed.

The country will not experience a normal economic recovery because the government has intervened in ways it has not done so before. Not only that, the government has promised to keep intervening in all aspects of our economic life. This fosters uncertainty and fear. How can any business person plan for the future when the unpredictability of the current administration makes any future assumptions more fiction than they normally are? With fear of higher taxes, the falling dollar, cap and trade, health care changes, income redistribution, salary caps, government competition with private enterprise in the auto industry, the banking industry, and the health care industry, why would any sane private business planner spend one thin dime? He won’t, and the economy will continue to stagnate.

What has allowed the economic dynamics of our economy to excel in worldwide competition has been the relative stability of our system. Our rule of law has always given a firm base on which to build an economic structure. Predictability and reliability are the cornerstone of our free enterprise system. That has been shattered.

The Obama administration has spent so much money it has undermined faith in our economy not only here at home, but abroad. There isn’t a day that goes by when there isn’t a news story reporting that the International Monetary Fund, the United Nations, and the likes of OPEC are secretly gathering to eliminate the dollar as the world’s currency of choice. The price of gold is going through the roof. The government printing presses have been turned on. Interest rates are at zero.

The deserved fears of massive deficits of catastrophic proportions are further bolstered by governmental intervention into bankruptcy proceedings, picking and choosing winners and losers in the supposedly free marketplace, subverting the rule of law. Government ownership in failed American businesses changes the rules of competition.

Add to the mix the Obama administration’s attempt to penalize American manufacturers through its draconian cap and trade plan. Meanwhile, back in Beijing, China has been quietly buying up all of the oil it can muster from just about every oil producer in the world. When there is a recovery, China’s current activities will drive the price of oil through the roof, making the spike of 2008 look like a walk in the park. Here is a news flash: China doesn’t give a good damn about climate change.

And don’t forget Obama’s bent to reward his union buddies, representing less than 12% of the American work force. Don’t forget the rising minimum wage. There is a real job creating policy.

So, let’s assume you are person who is of entrepreneurial spirit and want to open up a donut joint. Knowing that you may end up paying your worker’s $10.00/hour, knowing that any profits you make will be taxed at increased rates to “spread the wealth around,” knowing that you will be penalized if you don’t provide health care to your workers, knowing that you will have to spend huge amounts of money for “green” lighting, heat, and air conditioning, knowing that your employees will be encouraged to unionize….

Just how willing would YOU be to make such an investment? I thought so!!! No, this is not a normal business cycle. This time it is different, and this is the first time I believe it.

One postscript: if you are watching the rise in the stock market, it's not based on what is happening in the United States. It is based on what is happening in the rest of the world. The market can rise without any meaningful job recovery here. Just a thought, and one that is unsettling. Let me know when the real business cycle starts again...if it ever does.