Light at the End of the Fiscal Tunnel?

October 1, 2011

Hey! Cisco (not Bruce) the Harwich Spirits Shoppe blogging cat here….

It should come as no great surprise to anyone who regularly reads this blog that this feline is more than just a little skeptical about the future economic (and social) outlook for this country. (Just search this blog for the word ‘trillion’ and brace yourself.) If there ever was a model for American social meltdown, Hurricane Katrina was it…

Note the text below the image (emphasis mine.).

“USGS Lakeview. D.K. Demcheck’s mother-in-law’s dining room. It looks like there was a fire: That’s various shades of gray and black mold. October 3, 2005. U.S. Geological Survey “Lakeview” photographs document weekend “free time” in Lakeview. D.K. Demcheck’s mother-in-law and brother-in-law lived here. His mother-in-law’s place took 6 feet of water for two weeks. It was looted at least 3 times. The press reports of gunfire and breakdown of social order were exaggerated, but the amount of looting was not exaggerated.”

Like it or not, as we’re going right now, we’re headed for Greece type rioting and European type fiscal pandemonium.  Bartering will only last so long… After that, all hell breaks loose, rose-colored glasses or no. The bottom line is that we as a republic earn $15 trillion/per year, but we owe at least $100 trillion. As is now famous — that’s 4$ billion/day in interest alone.

So how can it be, that when we’re so economically and mathematically screwed that even our shadow is looking for Vaseline, there can possibly be ‘light at the end of the tunnel’???

The answer is absolutely stunning in it’s simplicity, and I’ll use an analogy to make my point… Go back fifteen years and imagine the best and brightest minds (and their supercomputers) trying to decode one of the proteins that makes up AIDS. Fifteen years, and no luck. Here’s what the scientists did — they made an online game of the problem and gave it to the cyber-world of rabid gamers. It took the dweebs just ten days to solve the problem (though it took a full three weeks to confirm the solution.)

Lesson learned? Is the lesson that gamers are hyper intelligent? Not exactly.  My guess is that the geeks didn’t have to worry about meetings, reports, forms, writing articles, editing articles, publishing articles,  government grants, tenure, department staffing and budgets, more meetings, more paperwork… Blah, blah, blah… No… The get-a-lifers just had to solve the damned problem.  In short… If we could just get the bureaucrats, politicians, regulations, litigation, and wildly exorbitant taxes off our backs, who knows what the American economy could do…

(Before anyone crows that I don’t know what I’m talking about when it comes to business… I’m Alan, the goober in the blue shirt below sitting besides Mr. Gates…

I ended up becoming the technical manager for that team as well as three others. I was eyeball deep in the hiring, training, mentoring, review, and firing process for hundreds of people at a whack over five years… So don’t give me crap about lack of experience in business.)

Right now, I’m thinking of three great businesses I could start easy breezy right here on Cape Cod. But I’ll just use one (without details) to show you why I stand pat… Let’s say I do a one day job for $1,000… Here’s how the costs would break down if I was lucky:

  • Insurance: $200… I’ve already looked into this. The number is $200 — Twenty percent right off the top so that I have a prayer should some jackass try to sue me.
  • Equipment: $20.
  • Transportation: $20.
  • Tax: $400 (I’m being very conservative here… For businesses grossing $100k to $335k, the corporate tax rate is 39%). Rest assured that local and state taxes would drive that number way up.
  • Labor: I’d need an assistant. That’s $150.
  • Unknown: Always plan for 10% or $100. (There are always fees, permits, licenses, and who knows what.)

So… Ballpark, I’d be left with $100 for an eight hour day… except that it wouldn’t be an eight hour day. It would be a 12 hour day. My business would be time intensive. That’s $8.33/hour optimistically. In the real world, $6.00/hour is more accurate. Hmmm… Why on earth would I take on the risk, heartache, and paperwork of starting my own business to make ‘sub-burger-flipping’ wages? But if we knock down the cost of taxes and insurance, then that’s do-able, and this country has a hope of crawling out of the vast hole we’re in.

Waiting by the racks…

Three cats blogging…


Wine Glossaries

* Nat Decants: A thorough glossary from Natalie MacLean, noted wine writer, speaker, and judge.
* eRobertParker.com: “The Independent Consumer’s Guide to Fine Wines”
* GLOSSARY of Wine-Tasting Terminology (Version 1.4 – Jan. 1995): A thorough collection of definitions from Anthony Hawkins.

Beer Glossaries

* ratebeer: Now that’s a straightforward name!
* beer-pages: Roger Protz and Tom Cannavan say that “it’s all about beer”.
* alphaDictionary.com: A fine collection of Beer dictionaries.

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Time to Stock Up

September 21, 2011

Did we or did we not warn you that this sort of headline was on the horizon? (Just consider a search of the Harwich Spirits Shoppe blog for the word “trillion“)

(Click on the pic above for full article.)

Let’s see… Aside from the headline above, China is sitting on a monstrous real estate bubble, Europe is in deep doo doo, and pay no attention to the CPI (Consumer Price Index) because that ultimately will have no effect on the cost of beer and wine. (NOT!) Oh, and we’re heading into Nor’ Easter season.

Please do this! Stop by the Spirits Shoppe and talk with Bruce about bulk buying of stuff like wine — the bulkier the better. The facts are that a.) you will drink the wine, and b.) the prices are not going to drop… This cat warned you that tropical storm Irene was going to be a problem… Well, he’s warning you again…

Stocking up by the racks…

Three cats blogging…

P.S. The market just dropped almost 300 points… As it stands now, all Wall Street and Broad is doing is playing chicken with time.


Wine Glossaries

* Nat Decants: A thorough glossary from Natalie MacLean, noted wine writer, speaker, and judge.
* eRobertParker.com: “The Independent Consumer’s Guide to Fine Wines”
* GLOSSARY of Wine-Tasting Terminology (Version 1.4 – Jan. 1995): A thorough collection of definitions from Anthony Hawkins.

Beer Glossaries

* ratebeer: Now that’s a straightforward name!
* beer-pages: Roger Protz and Tom Cannavan say that “it’s all about beer”.
* alphaDictionary.com: A fine collection of Beer dictionaries.


Economic Insanity…

September 17, 2011

Hey,

Cisco the blogging cat here… Gotta offer up some insane Guv’ment math and pray that someone will find fault with my numbers…

This has to do with the proposed new ‘American Job Act‘…

Let me see if I’ve got this straight using just round numbers. (Don’t jump ugly on me if these numbers aren’t precise — I’m just trying to ballpark this thing…) We’re going to spend roughly $500 billion dollars in the hope of what the White House guesstimates will generate 1.9 million jobs. If I’m right, that comes down to an outrageous $263,000/job. That’s nuts. Back in the day when I worked in the corporate world, we planned on spending $20,000 to find a good, general, productive, long-term employee. Now that number can go as high as $60,000, for a top-end, non-exec person. Spending a quarter of a million dollars/job is ludicrous…

But O.K… Let’s just go with those numbers… Let’s say that 1600 does find 1.9 million jobs. (Though the actuality of finding ‘shovel-ready‘ jobs has proven to be  bit more difficult than speeches portrayed it to be….) But let’s just say that we get our 1.9 million jobs. And let’s also say that each job pays $50,000/year, and is permanent. (We can dream, right?) Further, let’s pretend that the employee pays 30% in federal taxes. (I know that the odds are that someone making $50k isn’t going to pay fed taxes. Stop nit picking!) So, each year of labor equates to $16,000 paid back to Big Brother… At that rate, it will take 15 years for Joe Worker to pay back Uncle Sam’s ‘$250 large’ job finder’s fee. But even here there’s a problem…

The average job duration in America is four years. Read that, “We’ve spent 250,00 taxpayer’s dollars to find someone a job, and he’s paid us back $64 thou’ for our efforts.” Say, that reminds of a joke…

Two shirt makers (‘Gordon’ and ”Tommy Schmuck’) are talking and the conversation goes something like this:

Gordon: “You know Tommy, I’ve been watching your business, and you must be taking a beating… You’re spending $12 to make a shirt, but only selling it for $3…”

Tommy Schmuck: “That’s true, but I have a secret…”

Gordon: “So, what’s your secret?”

Tommy Schmuck:I deal in volume!

Three cats by the racks, and we’re all shaking our heads in disbelief…

P.S. (Somebody… Anybody… Please! Check the math and reasoning!!! I’ve got to be wrong somewhere!!!)


Wine Glossaries

* Nat Decants: A thorough glossary from Natalie MacLean, noted wine writer, speaker, and judge.
* eRobertParker.com: “The Independent Consumer’s Guide to Fine Wines”
* GLOSSARY of Wine-Tasting Terminology (Version 1.4 – Jan. 1995): A thorough collection of definitions from Anthony Hawkins.

Beer Glossaries

* ratebeer: Now that’s a straightforward name!
* beer-pages: Roger Protz and Tom Cannavan say that “it’s all about beer”.
* alphaDictionary.com: A fine collection of Beer dictionaries.


Obama’s Lost ‘Lincoln Moment’

August 3, 2011

It was the end of June, 1863, and southern general Robert E. Lee continued his relentless march northward. President Lincoln knew that Lee had to be stopped if there was any hope of actually winning the Civil War. But there were options — Lincoln could have acquiesced — basically “suing” for an end to the carnage and in doing so satisfied both the South and the growing peace movement in the North. But that acquiescence would have come at a terrible cost — slavery would stand, and the entire balance of states’ rights vs. the right of the entire country to remain a ‘house undivided’ would have been called into question. Historically speaking, Lincoln made the right choice… the unpopular choice… the ghastly choice. He would use his General Meade to stop the unstoppable Lee in a small town in Pennsylvania named Gettysburg. (That must have been a tortuous decision given the slaughter of  Antietam less than a year earlier.) But that is what Lincoln and Meade did — in three days of hellish combat (some hand-to-hand) they halted Lee, suffering a total of roughly 8,000 Yank and Rebel dead, and 50,000 wounded, lost, or captured. To say that America was appalled is a massive understatement. But Lincoln had turned the tide and in doing so, laid the groundwork for our country as we know it today.

Fast forward to February 10, 2007… Barack Obama announced his presidential candidacy in Springfield, Illinois, the same place where Abraham Lincoln had made his historic challenge to slavery in June 1858. (It’s no great secret that Obama likes to think of himself as being on the same plane as Lincoln. Remember, it was Barack who was going to herald the moment when the “oceans recede“.) Back in the 19th century, Lincoln said very plainly, “A house divided against itself cannot stand,” and he meant it. And therein lies the difference between the two men… Look at the numbers below…

Forget about the $14 trillion debt. That is a skirmish. Look at the $115 trillion in unfunded liabilities. That’s the Gettysburg. Ever since President Obama took office, he has had the rare and very unenviable opportunity to use his bully pulpit to spread the word and act upon the coming fiscal catastrophe. (Have you noticed that words like ‘catastrophe‘, ‘disaster‘, and ‘dire‘ are finally beginning to slip into the political and media lexicons?)

Using tools that vary from Executive Orders to Twitter, Obama could have issued everything from Executive Orders to tweets calling for the elimination of sacred cows like the EPA, NASA, and the Department of Education. (John Stossel et al have compiled an interesting list of possible targets.) The POTUS could have gone on TV, taken off his tie, looked the citizenry right in the eye, and said something to the effect of…

“Look folks, economically speaking, we’re in deep fertilizer. Unfunded entitlement ‘spending’ is going to drown the U.S.A. Currently, for every dollar the federal government spends, we have we have to borrow forty cents. Now, look at the chart below…

What that boils down to is that over 50% of our entire federal budget goes to unfunded entitlement spending including Social Security, Medicare/Medicaid, and pensions. That’s over twice what we pay for our military. This has to change. In the days and weeks ahead, you will see sweeping changes, and quite frankly, most of you will be appalled. But I will not let this country fall. This house will stand.”

That could have been Obama’s ‘Lincoln Moment’. Instead, he sat on the sidelines and waited to sign into law a bill that jacks our debt limit up by yet another $900 billion, and ‘promises’ to ‘cut’ (depending on yet another unannounced committee) a useless $1 to $4 trillion over ten years.

Barack, you blew it. By way of analogy, you just ordered General Meade to turn tail and run. You could have rallied this country and your troops to face this national, pecuniary mortal enemy. You had the oratory skills and the sheer ruinous fiscal numbers… You could have made the right choice… the unpopular choice… the ghastly choice… You could have done it.  Instead, you led from behind like the cheap, hack, inexperienced, agenda-blind Chicago politician that you are… Your ‘Lincoln Moment’ has been squandered, and that has made all of the difference.

Depressed and frightened by the racks…

Two cats blogging…


Wine Glossaries

* Nat Decants: A thorough glossary from Natalie MacLean, noted wine writer, speaker, and judge.
* eRobertParker.com: “The Independent Consumer’s Guide to Fine Wines”
* GLOSSARY of Wine-Tasting Terminology (Version 1.4 – Jan. 1995): A thorough collection of definitions from Anthony Hawkins.

Beer Glossaries

* ratebeer: Now that’s a straightforward name!
* beer-pages: Roger Protz and Tom Cannavan say that “it’s all about beer”.
* alphaDictionary.com: A fine collection of Beer dictionaries.


Now This is Weather Done Right! (And Then There’s that Pesky Economy…)

July 26, 2011

Ahhh…

Today (7/25/2011) was perfect. Not too hot… A decent, clean breeze… No glaring sun… If by chance you’re vacationing on the Cape, and got to experience this, that’s as close to Patti Page as you’re going to get. This was a day for Nat King Cole’s “Those Lazy-Hazy-Crazy Days of Summer“, a day for cool napping, and later, cold fried chicken (by far and away, Shaw’s Marketfresh Lacarte is the best). Yup… This was a keeper…

And then there’s the economy… How long have we been warning you that Hades was about to break loose? Since December 2009 in this forum, that’s how long.  Look, these ass hats in DC are struggling to trim $3 trillion in 10 years… How about amortizing $100 trillion in 10 years? Even if, by some miracle, the idiots in Washington do manage a way to lop off $3 trillion over a decade, those savings will have to go on non-stop for 300 years to truly get our fiscal house back in order; that’s how badly our entitlements spending is mangled…

Do you want to know the frightening thing for me? I’ve been writing about this catastrophe-in-the-making for five years. (I have my own blog, and my first year’s readership was 250,000.) And over those five years, I’ve gotten a ton of comments… Some people didn’t like me because I sounded too conservative… Others thought that I was a closet liberal…  But not once… Not once has anyone ever questioned my financial numbers or my assessment of the ramifications of those numbers. It’s as if the math is just too overwhelming to either comprehend or face. People aren’t scared, they’re resigned. (Thoreau said, “The mass of men lead lives of quiet desperation. What is called ‘resignation’ is confirmed desperation.”) How true today…

My heart-felt advice? Pay off your personal debt, and stock up on your wine…

The day is coming.

But hey… I’m just a cat by the racks…

Two cats blogging…


Wine Glossaries

* Nat Decants: A thorough glossary from Natalie MacLean, noted wine writer, speaker, and judge.
* eRobertParker.com: “The Independent Consumer’s Guide to Fine Wines”
* GLOSSARY of Wine-Tasting Terminology (Version 1.4 – Jan. 1995): A thorough collection of definitions from Anthony Hawkins.

Beer Glossaries

* ratebeer: Now that’s a straightforward name!
* beer-pages: Roger Protz and Tom Cannavan say that “it’s all about beer”.
* alphaDictionary.com: A fine collection of Beer dictionaries.


U.S. Debt-Ceiling Talks Falter after 90 Minutes and Pack Instinct…

July 11, 2011

Hey!

Cisco the blogging cat here…

Well, it’s official… Our illustrious leaders have yet again power-masturbated themselves into opposing and mutually exclusive corners within just 90 minutes. It only took an hour and a half out of four or five to decide that they just had to agree that each side was hopelessly despicable.

So where does that leave us? It leaves us alone with the truth… And here’s what that truth looks like…

That’s one-hundred and fourteen trillion plus smackers in hock… The ugly truth is that as of this moment, nationally, we’re committed to well over one hundred trillion dollars that we simply don’t have. (We only make $14 trillion/year… See last link…) And worst of all, we’re borrowing to pay off the interest on the original loans. (40% of every American federal dollar is borrowed vs. earned.)

Lest anyone leap into a Left or Right circle jerk, FDR started this entitlement Ponzi scheme, and Dubya didn’t help with “Part D.” ‘Nuff said.

So how do we as a country get out of this fiscal mess? Taxing the rich is flat out stupid. We could take all the money from all the billionaires on earth, and that would only add up to about $4.5 trillion, or 1/20th of the hole the U.S. is in…

Three times this weekend we’ve heard the “economic experts” use the phrase, “going over the edge of a cliff…”

So by analogy, here’s my point… Many moons ago (when we were just kittens), we attended a sporting event at Madison Square Garden in NYC. While it started in broad daylight, the path from parking to Garden was still fraught with addicts and pushers. (I doubt that there was a boy scout amongst them.) But the show ended around 10:30 PM, and that meant walking the gauntlet back to the cars. Instinctively, a sizable group of strangers banded together and moved like a school of fish through the shark-laden streets. We didn’t know if the problem was going to be a crook or a crazy, but by damn, we could sense the danger.

That’s what’s happening to the American economy, and to Americans themselves — we’re not sure what’s going to happen, but we all can feel in our gut a “bad moon rising”…

Mixed metaphors aside, brace yourself…

Two cats blogging by the racks…

P.S. To see earlier entries on this issue, query on this blog for the word “debt”.


Wine Glossaries

* Nat Decants: A thorough glossary from Natalie MacLean, noted wine writer, speaker, and judge.
* eRobertParker.com: “The Independent Consumer’s Guide to Fine Wines”
* GLOSSARY of Wine-Tasting Terminology (Version 1.4 – Jan. 1995): A thorough collection of definitions from Anthony Hawkins.

Beer Glossaries

* ratebeer: Now that’s a straightforward name!
* beer-pages: Roger Protz and Tom Cannavan say that “it’s all about beer”.
* alphaDictionary.com: A fine collection of Beer dictionaries.


And the Economic “Edge of No Return” Draws Closer…

June 12, 2011

Hi,

We may just be a couple of blogging Harwich Spirits Store cats, but we’ve predicted economic disaster time, and time, and time, and time again… Now there’s this stark warning from the Chinese central bank adviser saying that if the U.S. defaults on our debt, we’re,

“playing with fire…

Basically, we’ve sold treasury bonds to China and Japan (to the tune of roughly $1.5 trillion) and those bonds/interest are coming due… And if that isn’t bad enough, we owe another 30 countries… Check out the current screen shot of our national financial mess…

There are three sets of numbers in focus here… From top down, there’s our infamous national debt which matches the second number (our entire GDP — that is, our entire annual income for goods and services.) But it’s the bottom set of numbers that scares the Chinese… We facing smack dab $100,000,000,000,000.00 ($100 trillion) in utterly unfunded liabilities, we’re in debt, and we have absolutely no way of digging out of the hole. Ah shucks… Forget about the debt… It’s the liabilities (Medicare, Medicaid, Social Security, and public  pensions) that are driving us toward the “Thelma and Louise” final scene…

At this point, our unfunded liabilities are at least six times our GDP, and nothing can slow that down… Forget about taxing the rich… Hell, we can take all the money from the millionaires and billionaires, and we still can’t back off the edge…

Time to stock up…

Two cats by the racks…


Wine Glossaries

* Nat Decants: A thorough glossary from Natalie MacLean, noted wine writer, speaker, and judge.
* eRobertParker.com: “The Independent Consumer’s Guide to Fine Wines”
* GLOSSARY of Wine-Tasting Terminology (Version 1.4 – Jan. 1995): A thorough collection of definitions from Anthony Hawkins.

Beer Glossaries

* ratebeer: Now that’s a straightforward name!
* beer-pages: Roger Protz and Tom Cannavan say that “it’s all about beer”.
* alphaDictionary.com: A fine collection of Beer dictionaries.