Author: coastcontact

I am a somewhat cranky but mostly optimistic 65 plus who refuses to give up on this maddening world. The purpose of this BLOG is to express my feelings, thoughts.

The Tea Party Just Wants To Save Money!

If H1N1 had become a pandemic and there was no vaccine would you understand that the government was just trying to save money?  Aid for an earthquake in California or a Hurricane like Katrina, sorry we need to save money!  Besides it’s none of our business says Uncle Sam.

Tea Party groups have two major arguments with the Federal government.  First, the Federal debt is so high that it will leave a burden for generations to come.  Many say that our grandchildren will be faced with the problem.  Second, the Federal government is intruding in our lives at an unacceptable level.  Government is trying to control our lives.  The control that government is trying to impose is far beyond what the Constitution allows.  I am not clear which is of greater concern.  While I agree with the concern, I am not convinced that most people understand the consequence of a reduced role for government.

I decided to list some of the many projects and departments that have been adopted by the Federal government.  Which ones would we really be willing to forego?

-The Interstate highway system was built with a combination of money from the Federal government and individual state governments.  Funds continue to be made available to maintain and upgrade that system.  The highways are not only for private passenger cars but are used by the trucking industry.  Here in Los Angeles the Long Beach Freeway is a primary route for moving goods from the ports to distribution centers.  Los Angeles/Long Beach ports are the largest in the nation.

-Social Security, Medicare, and Medicaid are the three most expensive and most used Federal programs.  I have not met a single person who is willing to surrender their benefits including the wealthy and the Republicans who bad mouth those programs.

-The Food and Drug Administration is a popular target of those wanting more attention to detail.  FDA officials were roundly criticized for not enforcing health standards at the Peanut Corporation of America in Georgia.  The slaughter of sick cattle and the occurrence of salmonella poisoning has brought complaints about the FDA’s lack of enforcement.  When drugs are not approved in a timely manner we attack the FDA but if a drug was approved that has caused death or injury we say that it’s the fault of FDA procedures.

-The Securities and Exchange Commission (SEC) is the much maligned department that we want to ensure that the financial industry is not cheating investors.  It’s done a poor job but what if there was no agency? There wasn’t one before 1934.  The main reason for the creation of the SEC was to regulate the stock market and prevent corporate abuses relating to the offering and sale of securities and corporate reporting.           

-The FAA (Federal Aviation Agency) is respected around the world.

– The National Highway Traffic Safety Administration (NHTSA) just fined Toyota $16 million.  The agency appears to be under manned.

 – U.S. Immigration and Customs Enforcement (ICE) is the largest investigative agency in the U.S. Department of Homeland Security (DHS).

– The FBI recently arrested Najibullah Zazi, 24, a Colorado airport shuttle driver who has admitted receiving weapons training from al-Qaida, played a direct role in an alleged terror plot, according to court documents released Sunday. Authorities have said they don’t know the timing or location of any planned attack.

So which agencies are you willing to close to save money?

Return to Glass-Steagall

The Glass-Steagall Banking Act of 1933 forced commercial and investment banks to separate. Commercial banks were not allowed to underwrite the sales of stocks and bonds, while investment banks could not take in deposits from customers.  The law remained in place for half a century before it was repealed in 1999 through the Financial Services Modernisation Act, again better known by the names of the politicians who promoted the legislation – Gramm, Leach and Bliley.

What we need is a return to Glass-Steagall.  I have not heard one government spokesperson say that the new proposed law will bring back Glass-Steagall.  Apparently I am not alone.  David Champion  writing in the on-line Harvard Business Review,   “But the evidence we have so far doesn’t really support the contention that this is Glass-Steagall redux. Nowhere have I seen a statement that banks will not be able to take positions in traded equities or equity derivatives or to do underwriting in equities, currencies, commodities, interest rates, or credit. The only businesses that they are clearly being precluded from are private equity and sponsoring hedge funds.”    

So while President Obama talks about his new financial regulations there is no indication that the new law will prevent another panic and another bank bail out.  The proposed new laws do not go far enough to control banking misbehavior.

Now for the Sales Pitch

BusinessWeek’s April 19, 2010 edition cover story is titled “THE HOT HAND OBAMANOMICS IS WORKING BETTER THAN YOU THINK.”  Newsweek’s April 19, 2010 edition cover story is titled “AMERICA’S BACK! THE REMARKABLE TALE OF OUR ECONOMIC TURNAROUND.”  

These are sales pitches telling readers how much the economy has improved.  Of course each article offers an array of graphs and art work to support their contentions.  It’s true that corporations have seen improved earnings.  That makes stockholders happy but most of us don’t own enough stock to experience any change in our lives. 

From the Investment Company Institute web site: The average 401(k) account balance moved up and down with stock market performance, but over the entire five-year time period increased at an average annual growth rate of 7.2 percent, attaining $86,513 at year-end 2008.

Another blog titled Bargaineering provides this data from the Employee Benefit Research Institute’s latest report on Individual Account Retirement Plans by age group (August 2009):  

  • < 35: $6,306
  • 35 – 44: $22,460
  • 45 – 54: $43,797
  • 55 – 64: $69,127
  • 65 – 75: $56,212
  • 75+: (sample size insufficient)

    •    

Some words of warning after you read this:  

  • Remember that this data is just data, you can’t draw any conclusions of what’s right or wrong from the statistics alone.
       

    If you’re “below average,” you shouldn’t feel bad about it. Age is not a good indicator of where you are in your life. Some people get a later start and others have a more inflated lifestyle, how much you’ve saved by when should only give you a bar to reach.

    If you’re “above average,” you shouldn’t rest on your laurels and think you’re doing great. Much like the words I wrote for those who are below, being above doesn’t mean you’ll have enough for retirement. You have a few years until retirement, a lot can happen then, so keep at it.

    Average doesn’t mean someone in their 20s that has more than $6,306 is set in retirement (or that someone with less is screwed). It’s estimated that you should spend about 4% of your nest egg each year. At 4%, your nest egg should last long enough. How does that 4% figure translate to your estimated yearly expenses? Divide how much you think you’ll spend by 0.04 and you have your target (based on that rule of thumb) – $50,000 a year requires a nest egg of $1.25M. 

    •  

Other web sites support the above data.  This translates to most of us DO NOT have sufficient savings to experience a consequential impact of a rising stock market.  
 
Since the week ending November 21, 2009 Weekly Initial Job Claims report from the U.S. Department of Labor have ranged from 432,000 to 496,000 people.  For the week ending April 10, 2010 those new claims were 484,000.  There has been no downward trend.  The same department reports that over 15 million Americans are unemployed.  The number of unemployed was just short of that number in August of 2009.  The numbers have not changed since then.  
 
 Why aren’t Tea Party demonstrators parading about this issue?  Apparently they are mostly White and well off! 

Hybrid Cars Are in Everyone’s Future

Hybrid care.com has gone overboard in their listings because they include diesel and high mileage internal combustion vehicles.  The owner of that web site needs the advertising revenue.  That makes the reliability of the data and opinions questionable. Motor Trend magazine, Popular Photography and other magazines that rely on manufacturers for survival cannot provide unbiased information.

News that UPS has expanded its fleet of alternative-fuel vehicles adds to the growing hybrid vehicle trend.  The number of auto manufacturers offering hybrid technology has grown substantially in the past few years.

I own  a 2001 Nissan Maxima.  It has a V6 internal combustion engine. On freeway and highway driving from Los Angeles to San Jose the mileage was 30 MPG.

Consumer Reports was a good resource for automobile reliability.  However, the error in not detecting Toyota acceleration problems has put the magazine’s reliabilty into question.   

                                                                  Combined
                                                                  MPG

Toyota Prius                                            50 MPG

Honda Civic Hybrid                                  42 MPG

Honda Insight                                         41 MPG

Ford Fusion Hybrid                                  39 MPG

Mercury Milan Hybrid                              39 MPG

Nissan Altima Hybrid                               34 MPG

Lexus HS 250h                                         34 MPG

Toyota Camry Hybrid                              33 MPG

Chevrolet Malibu Hybrid                          29 MPG

Lexus GS 450h                                         23 MPG

Mercedes S400 BlueHybrid                      22 MPG

Lexus LS 600h L                                      21 MPG

Hyundai Sonata Hybrid                           38 MPG

Hyundai Accent Hybrid                            n/a

Honda Fit Hybrid                                     n/a

BMW ActiveHybrid 7                               n/a

•Los Angeles Photo Gallery

So what am I doing with my Panasonic Z28 camera?  A camera class induced my purchase of this somewhat complicated device.  It can be used as a point and shoot but offers shutter priority and/or aperture priority and a variety of other controls..  The Los Angeles Photo Gallery on the right will be continuously updated.

Southerners Have the Right to Self Determination

The province of Quebec Canada was a French colony until September 1760.  In a war with France, the British took control and made the colony part of Canada.  The French speaking citizens never gave up their French connection and to this day the primary language spoken in that province is French.  There were two attempts in the latter part of the 20th century to vote for separation of Quebec.  Both elections were close but the province did decide to remain part of Canada.

Now we have the governor of Virginia declaring “Confederate History Month.”  Sons of Confederate Veterans has a web site calling the Civil War the “Second American Revolution.” The flag of the State of Georgia from 1956 to 2001 incorporated the Confederate flag.  The South Carolina State House in Columbia displays three flags in the following order from top to bottom: The Flag of the United States of America, The South Carolina State Flag, and The Flag of the Confederate States of America.  The Mississippi flag currently incorporates the Confederate States of America flag.

On my trips to Alabama, Georgia, North Carolina, South Carolina, Texas, and Virginia I was invariably faced with a native of those states wanting to discuss slavery and discrimination.  These were not subjects that I introduced.  As evidenced by Virginia Governor Bob McDonnell, many Southerners have not only not forgotten the Civil War, they would like to succeed from the Union.

I believe we should let them vote for secession just as Québécois voted.  If Southerners want to separate from the United States they should be given that right of self determination.  If a majority vote to stay part of the United States they should shut up and accept the rule of American law.

Who Cares About the Facts?

If you have read it, it must be true.  Blogs spew extraordinary amounts of mis-information.  Of course, those with a political point of view are trying to sell everyone their beliefs and write things that they know full well are lies or near lies.  That is the folly of freedom of the press.    

Thus we have the short piece in Newsweek’s April 12, 2010 edition titled “INDIA IS ANNOYED BY THE U.S.”  The author, Sumit Ganguly, contends in red text “But the Obama administration, preoccupied with China and the Middle East, has left little room on its schedule for India.”  Perhaps Mr. Ganguly was on vacation while we all saw the State Dinner for the Indian Prime Minister on every news show.  If you will recall that was the dinner with the uninvited guests.  The dinner received significant coverage by almost every news outlet.

Then there is Debbie Poochigian, Fresno County California Supervisor, and most likely a Republican.  Her poorly researched commentary only reinforces my perception that people support a candidate just because the person is a member of their political party.  On the Fox and Hounds blog she contends that Senator Barbara Boxer does not adequately support job growth in California.    However the facts do not support her contentions.  To the contrary when President Obama signed the recent jobs bill the Chicago Tribune quoted Boxer with these words, “This is a great day. Today, a million American workers — including 100,000 in California — know their jobs are more secure because we have renewed the transportation bill through the end of the year.”  Further more Boxer voted for the continuation of the C-17 aircraft program even though Secretary of Defense, Robert Gates, wanted to kill the project.  5,000 jobs were saved in Long Beach California as a result of this congressional action.