A string of Federal Reserve officials on Tuesday indicated the central bank will soon offer further monetary stimulus to the economy, with one saying $100 billion a month in bond buys may be appropriate.
While internal differences on the unconventional policy are still evident, the consensus view at the Fed appears to be that the economy is weak enough to warrant further support, most likely through increased purchases of Treasury debt.
The U.S. economy is expected to have grown just 1.9 percent in the third quarter, a level considered too low to bring down unemployment. The debt purchases would help lower long-term interest rates in the hope of boosting demand.
This item stands in interesting juxtaposition to China’s decision earlier Tuesday to raise interest rates in order to dampen inflationary pressures in that country.
In my consulting work I encounter about 20 small to mid-size industrial concerns making everything from plastic swimming pools to wiring for houses to tires. Not a single one of them is having any bank problems with managing cash flow for operations.
EVERYONE of them is concerned about what 2011 is going to bring. Where they are hiring, it is to fill critical vacancies. Where they are expanding, it is to debottleneck filled capacity.
I don’t see how the Fed cannot prime the pump that the Administration has closed down by its anti-business, anti-capitalistic policies.
What are the anti-business, anti-capitalistic policies you are referring to, so that we can evaluate your posistion. We know you disagree with what he has done in connection with health care, so lets take that off the list for now, as almost everyone agrees the bill that passed was not what anybody really wanted.
#1. It also stands in interesting juxtaposition to Britain’s decision to cut spending.
We are already seeing the effects of QE at the gas pump…prices are increasing (despite a decline in demand) and that means that the value of the dollar is once again declining.
#3, You are taking Obamacare off the table and then you ask what “anti-business, anti-capitalistic policies” are the problem. That is like asking Mrs. Lincoln: “Other than [i]that[/i] Mrs. Lincoln, how was the play?”
The Obamacare requires a 1099 for every transaction…let that sink in for a moment…EVERY transaction of $600 or more. You don’t think that is anti-business? Obamacare is causing insurance premiums to skyrocket…which increases the cost for business owners, causes reduced coverage for employees and owners, leads businesses to drop existing good coverage policies in favor of cheaper “meets the government requirement” policies, or some combination of all of the above. You don’t think that that is anti-business?
[blockquote]you ask what “anti-business, anti-capitalistic policies†are the problem[/blockquote]
No, my question was what anti-business, anti-capitalistic policies #2 was referring to other than Obamacare. I see no need to further discuss Obamacare. Both sides make unfounded claims about the program and I am no fan of it either. It did not accomplish what Americans wanted. Americans wanted an end to pre-existing conditions, lower premiums, and small business wanted to get out of providing insurance for employees. Arguably, only one of the three was accomplished. Although I do think it grossly unfair that someone can refuse to buy health insurance and then go to the emergency room and recieve free treatment that requires my insurance company to increase premiums for my employees.
I do disagree with your statement it has sent insurance through the roof. I own and operate a small business, now 13 employees. I received my annual increase letter this year telling me my health insurance premiums would go up by 15%. My insurance premiums have gone up between 12% and 14% for each of the last five years (possibly longer, but I have not checked). So unless the 1% to 3% increase is what we are talking about, I have no evidence of skyrocketing insurance costs.
As far as the 1099s are concerned, my Quickbooks program will produce 1099s for any vendor I desire. My bookkeeper simply pushes a button and it prints out. I suppose it will take some time on her behalf and the postage. I assume this could be expensive for large corporations, but for most small businesses the cost will be minimal. What was the $ amount before?
My BC/BS premiums increased by 13% last year. This year, they are slated to increase by 22.9%. For those just entering BD/BS coverage, the premiums are slated to increase by 47% in CT. So, yes, that is “skyrocketing” costs in my book. As for the 1099s, they will cause and increase in labor costs to generate and file. They will cause an increase in printing costs and mailing costs. And finally, there is also the issue of audits and the additional burden this new law will add with its added expense. You want to take two real issues of “anti-business, anti-capitalistic policies†off the table and then have a discussion. Sorry…that is a non-starter.
Sorry…typo…BC/BS
Ok, so now we have discussed Obamacare, so what other anti-business, anti-capitalistic policies are we talking about.
#10, I don’t agree with your premise. We have not really discussed ObamaCare because we have not discussed the long range outlook. To be short, that will be costs (far in excess to the claims) and the effect of nationalizing 1/6 of the economy. And you forget all the taxes on medical equipment, capital gain tax increases as well as taxes on dividends. That takes money out of the private sector into the government sector, for what?
Let’s look at letting the Bush tax cuts expire. That will also take money out of the private sector into the government sector, for what? Are you really going to tell us deficit reduction??? And don’t forget AMT taxes patches that may not make it. That will sweep millions of new taxpayers into AMT at $2000-4000 a pop. How much of your products won’t they be buying now?
Now on to the EPA, if Obama can’t get Cap & Trade the EPA will do it for him through CO2 regulation, pollution permits and tax hikes.
Let’s look at Obama’s Fed, getting ready to devalue the dollar by monatizing our debt, think that will be helpful for your small business?
And let’s look at the whole “green jobs” initiative. Nothing but money down a rat hole, the same rat hole that the DOE has been flushing money through for 40 years. What does that do for business and capitalism?
Just an introduction to the subject at no charge to you……….that might actually help your business!
I’m not an Obama supporter or detractor. I am just trying to ascertain if there is any truth to the allegation Obama is anti- business and anti-capitalism; because the charges are so heated and many allegations are not true. In your post for example.
Obama has not proposed letting the bush tax cuts expire for everyone. Only those making over 250k per year. It is the Republicans who are willing to let the Bush tax cuts expire on those who make less than 250k per year. One could argue allowing taxes to increase on those in the top 5% will slow the economy, and perhaps that is anti-business. But we do have debts to pay,and taxes are necessary to pay those debts. The level of tax on those earning over 250k will still be less than those proposed by Ronald Reagan.
As far as taxes on capital gains and dividends; I have never understood the argument that people who make money on money should pay less than people who make money in exchange for goods and services. I think dividends, and interest should be taxed at the same rate, I think corporations should get a 100% tax deduction for dividends they pay out to shareholders, and I think capital gains should be taxed at normal income tax rates, but that basis should increase with inflation, so that only true income is taxed. To me income is income. Also the Bush tax cuts on dividends, and capital gains did little for small business. It was designed to benefit a very small group. Most small business people and working people have their investments in 401k plans and IRAs. The dividends and capital gains taxes earned in those were excluded from the benefits of lower rates. Less than 3% of Americans earn more than $10,000 a year in dividends outside of IRAs and 401Ks. The reason dividends and capital gains in IRAs and 401k were excluded, is it would have cost too much and they could not give as large a break as they wanted to the small group they were targeting.
The problem we have with taxes is neither side is really interested in making taxes neutral on the economy. Each side has an opinion of who the tax laws should benefit and surprisingly it correlates closely with who pays them the most money. There is no logical argument lower taxes are always better, unless you contend taxes should be zero.
I can’t evaluate what the EPA might do, but has not done or even proposed to do yet.
Obama does not control the Federal Reserve. It is an independent body, headed by a person put in control under Bush.
Whether or not encouraging the creation of green jobs is a waist of money is, I suppose, a matter of opinion. I would agree it is a big gamble, with long odds, and maybe a bet we should not take. I don’t really see however how it is anti-business or anti-capitalism, and if the DOE has been flushing money down a hole for 40 years, it seems to have happened under both parties, and I have not heard either party say let’s abandon the energy independence effort.