respublica

"Serious People" have a solution to the debt crisis

Ok, the full premise is, "serious people are saying the trillion dollar coin might be the solution to a looming U.S. debt crisis." If you've been paying attention lately you'd have seen "trillion dollar coin" pop up in commentary and the like. Here's the idea behind the trillion dollar coin.

"The coin gambit relies on an obscure law, intended to meet demand from collectors, that allows the Treasury to mint platinum coins in any denomination.

If Congress refuses to raise the debt ceiling, the Treasury can’t issue any more bonds, but it could stamp “$1 trillion” on a hunk of metal, deposit it at the Federal Reserve and begin spending the proceeds."

Yes, serious people think this just might hide the fact that revenue covers only 1/3 of government's actual spending. So hey, guys, let's stick a fake trillion dollar coin in the federal reserve and make people think we have an actual trillion dollars to play with.

Gee, I wish we could create a large amount coin down in the basement and use to pay our bills.

Cashiers won't even accept the average 20 dollar bill in the checkout line without examining it every which way and under 3 kinds of light and we're supposed to believe serious government creditors will accept a fake trillion dollar coin as real repayment money?

Seriously people.

16 hours 53 minutes and counting?

MSNBC has a countdown clock on the screen ticking away the hours until we go off the fiscal cliff at midnight. The question now is whether or not all those elected people in Washington even capable of doing what needs to be done.

So many non elected voices have been shouting out solutions but I'd be willing to bet that if those individuals were sitting in congress or the White House, it would not look quite so clear. Each tax increase or decrease has ramifications which will affect large numbers of people and jobs. Huge budget cuts have trickle down effects that reach all of us in some way.

It's harder to be in those seats than it looks, but truly, thoughtful minds have to finally come together and do something. And thoughtful minds don't obsess over what their former donors think. They don't put being re-elected ahead of serious solutions to a bad situation.

Lackluster shopping season?

Lots of stories right now on the less than stellar numbers of people Christmas shopping, business observers are calling it lackluster. Fewer shoppers, more stock in stores, now big discounts. If I had to guess as to why the stores haven't seen as much traffic since the Black Friday weekend, it's because so many of us are now shopping online. We did as much online this year as ever before and if you know what you want, it's so much easier than schlepping store to store. We'll see when the final numbers come out.

But here's an item that struck me funny this morning. The Post-Dispatch did a front page story on the lackluster shopping and reported on this:

"One holiday product line that did receive considerable buzz this year was the designer gift collection rolled out by Target and Neiman Marcus. But the collection appears to have fallen somewhat flat. On Thursday, Target slashed the prices on the items, which include Judith Leiber compact mirrors and Tory Burch lunch boxes, by 50 percent."

First of all I don't think of Target and Neiman Marcus in the same breath, I mean, are they selling the same things now just with different price points? But I laughed at the idea that anyone believed compact mirrors would be a big seller and designer lunch boxes? Seriously? Someone has been living on the upper east side of New York too long.

Becky's magic carpet ride comes to an end

A St. Louis advertising legend, often laughable, sometimes annoying, but always memorable, Becky the Queen of Carpet has closed all 6 of the Carpet and Tile Superstores.

Is there anyone in the St. Louis metro area who can't bring up a mental image of Becky standing up in the air on a piece of carpet touting her business? For years she stood swaying while dressed in a long ball gown and wearing a crown on her head. Long overweight, Becky underwent some sort of gastrointestinal by-pass surgery to lose the weight a few years ago.

Well suddenly it's over as employees were told they would lose their jobs and the question of whether the money customers paid for unfilled orders will be refunded remains unclear. Seems the economy hit the company hard.

Political pandering week by week

It's a campaign year and thus far each week or two has seen the Obama campaign harping on one thing or other.

It's been the War on Women, Racisim, and this week it's back to the Buffet Rule for solving the federal budget crisis. The Buffet Rule's main focus is that the rich should pay more in taxes. Funny how this works since Warren Buffet's company owes and has owed, over 1 billion dollars in back taxes. This is just not information coming from strictly conservative Buffet haters, even the Huffington Post took note.

But as I mentioned, this "make the rich pay more" is merely this week's DNC campaign meme. One CBS reporter wrote that by his count, the most recent Buffet Rule push is the 20th time Obama has used this in speeches since the State of the Union. Watch for all the spokemen heading for cable news shows pushing this once again. It's gotten so there are a handful of things in the regular rotation.

Sad closings

Several well known stores and restaurants announced their closings this week. The one which most surprised us was Casa Gallardo, the first Mexican restaurant in the St. Louis area and a fixture in Fairview Heights for decades. We went there many times although not in recent years.

Then the Monarch, a fine dining restaurant in Maplewood and one which consistently drew praise from St Louis food writers. Seems the Monarch's inside space was too large for the number of diners. They pay for square footage and the customers were no longer fillilng it it due, the owners say, to competition from the Groupon and other coupon deals other restaurants were offering.

Then there's Sears. The granddaddy of big retail stores is closing the Crestwood location. Looks like the Sears in Fairview Heights is safe for now. 

My favorite tweet from yesterday

@keder: Why does Obama get to take credit for this month's decent jobs report when he blamed last month's crappy one on Bush? 

and this:

 

Success is all in how you look at things politically

When the Super Committee quit with nothing to show for their assigned goal of helping us out of this economic mess, many called them a failure.  Yet, some are saying just the opposite which was they succeeded at their real goal which was to get us to Thanksgiving and provide cover for another increase in the debt ceiling.

This argument has some merit because the committee did not even meet this month.  "As the deadline of Thanksgiving rapidly approached, the supercommittee members couldn’t be bothered to sit in the same room together.

A committee who's main purpose was the very definition of "kicking the can down the road."

Frankly I don't know who benefits politically from this, maybe the president who can point his finger at the congress.  But this group couldn't even agree to cut one trillion?  My gosh, we're racking up 1 trillion in deficit every month.  

Better to live in a red state than a blue

Most of the “poor states” states, as the American Legislative Exchange Council calls them, have the highest personal income tax rates and the largest unfunded state pension liabilities.  But instead of taking the red-state approach by lowering taxes and/or cutting spending, the blue states tend to want to raise taxes even higher, just like their White House mentor.

The result of their overpromising and overspending, and their knee-jerk response to solving their fiscal problems by raising taxes, is that people are increasingly fleeing the blue states. 

 

The Broken Window theory

Suddenly last night the internet was lit up with talk about the Broken Window theory of economics.  I confess I'd never heard of this and the more I came across it the more interested I was to know just what people were talking about. 

In essence, the theory goes like this:  A shop keeper's front window is broken by a rock thrown into it by a vandal.  As awful as this is for the shopkeeper, it will help the local economy by creating a job for the window repairman. 

This all came up because of Nobel Prize winner, Paul Krugman's comments or supposed comments on yesterday's earthquake.  "People on twitter might be joking, but in all seriousness, we would see a bigger boost in spending and hence economic growth if the earthquake had done more damage."

Whether he said them or not, he did say similar things about the economic benefits of WWII and the destruction after 9-11.

The theory has been refuted by others who see other economic negatives which balance out the window repairman. 

@Melissa Tweets tweeted :  I wonder how Krugman would feel if the economy was stimulated by his house being razed to the ground.

All in all, it's been a good day for learning something new.