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Posts Tagged ‘(the) treasury’

Is It Inflation Or Deflation Here?

May 9, 2009 (By Genevieve Hawkins)

From “Hawkins’ Eye On The Market”, by Genevieve Hawkins

Here’s something to ponder, other than the overhyped swine flu pandemic: if flooding the market with liquidity is supposed to lead to hyperinflation, why haven’t prices on goods and services started to skyrocket yet? So far Ben Bernanke has injected over $1 trillion into the markets, and Congress has had to raise the debt ceiling to keep the accounting in line. The infusions of cash were becoming so routine that they weren’t always reported, except by angry political commentators ranting about how much future taxpayer generations will have to be paying for this.

Traditionally such an influx of money might be expected to lead to Weimer style hyperinflation, where prices rise so fast that they could force a currency devaluation. Yet the March Consumer Price Index actually slipped 0.4% year over year, the first such decline since 1955. And a recent survey of small business owners found that none of them intended to increase prices in the near future. [entire post]

Tags: (the) treasury, (un)employment, bernanke, bubble, ceiling, congress, consumer price index, debt, deflation, government(s), housing, inflation, jean baudrillard, job(s), liquidity, obama, policy, political, small business, swine flu, tax(es), the fed, treasury inflation protected securities, weimer
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Tax Increases Start, 90 Days Into Presidency

April 30, 2009 (By Bud Burrell)

From “Front & Center”, by Bud Burrell

Today, the News Services announced that the Obama Administration and Congress will do away with the Middle Class Tax Cuts enacted under the Bush Administration. This comes on top an already announced decision to let the upper class tax cuts expire next year. Wow, that’s impressive, only 90 days to break the biggest recurring promise of his campaign.

The meager $400 Middle Class Tax Cut had already been eaten up with increased medical plan co-pay increases, along with increases in Social Security contributions. With only about 55% of Americans paying income tax, it means all tax payers paying over the standard social security contribution levels will be looking at tax increases next year.

The spectacular increase faced by all US citizens, tax payers or not, is the probable tax to be implemented for Cap and Trade, which will impose a 45% tax on all carbon based energy consumed by individuals, corporations, manufacturers, large buildings, and power plants. The minimum total tax increase on Utility bills alone will exceed 50% of current bills. This is money millions of Americans will not have to spend. [entire post]

Tags: (the) treasury, admistration, banks, cap & trade, co-pay, congress, energy, fund, government(s), gun control, health care, insurance, job(s), medical, middle class, obama, pension, retirement, single-pay, social security, socialism, tarp, tax(es), universal, utlilities
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Has The Economy Been Saved Yet?

March 31, 2009 (By Genevieve Hawkins)

From “Hawkins’ Eye On The Market”, by Genevieve Hawkins

The Treasury’s newest plan to preserve the economy as we know it was met with strong cheers on Wall Street on Monday, but there were considerable things left unsaid. The proposal to buy bank’s troubled assets, which was unveiled by Treasury secretary Timothy Geithner, involves the creation of a public/private partnership to bid on up to one trillion dollars of previously unsellable mortgage backed securities. The Treasury will provide guarantees and matching equity to hedge funds and others willing to buy the assets, which will be auctioned to the highest bidder.

The program is designed to free up the credit markets by finally giving a value to mortgage based securities that had been unsellable before this, which would seem to make logical sense. Assuming that very few of the houses that these securities were based on have dropped to zero in value, then these assets should have a worth, even if it is much below what they were originally valued at. Yet currently banks have had difficulty selling these products at any price, and have been forced to hold nonperforming assets on their books. Or so the theory goes, although the claims that this new move will free up the credit markets any better than the other trillions spent should be met with skepticism! [entire post]

Tags: (the) treasury, economy, geithner, mortgage(s)
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