Moving the Goal Posts: A National Pastime
By now you have heard about the president Obama's stimulus plan that will create 3 million new jobs. At almost a 1 trillion dollar price tag, the bill better create something! After repeatedly cranking out the 3 million jobs number for over 2 weeks, we see a shift in today's reporting due in no small part to the terrible job numbers. Check out how the wording is for the jobs building bill now, from Yahoo Finance:
Obama says jobless surge underscores need for urgent action to battle nation's economic crisis
Lolita C. Baldor, Associated Press Writer
Friday January 9, 2009, 12:13 pm EST
WASHINGTON (AP) -- President-elect Barack Obama called the latest U.S. job losses on Friday "a stark reminder of how urgently action is needed" to revive the nation's staggering economy. He said he was open to fresh ideas from Congress.
He spoke shortly after the Labor Department reported job losses of 524,000 in December and a 7.2 percent unemployment rate, the highest in 16 years.
He said the jobs report made quick action by Congress even more imperative.
"What we can't do is drag this out when we just saw a half a million more job losses," Obama said.
He noted that jobs were lost in all 12 months of 2008, and he called it "the single worst year of job losses since World War II."
He urged Congress to give its quick attention to his still-evolving economic stimulus plan, designed to create or save 3 million jobs at a cost of about $800 billion.
So at first the plan would have created 3 million jobs. This was a purely fantasy number with no bearing in reality. The sharp Obama crew have seen their error and not wanting to get tagged with a set number to miss, the new language has become more amorphous and vague. Now the advertisement is that the plan will be "designed to create or save 3 million jobs. This is a great move. I am not picking on Obama here, if McCain had won he would do the same exact thing. This is what is called "moving the goalposts" or "managing expectations". Now there is no hard numbers to gauge the success of the plan on. If 1 million jobs get created, they can say "yeah, but we saved 8 million other jobs from being lost" and there is no way to verify that. Slick move.
Today we also learned that the first half of the TARP money is pretty much gone without a trace. Very little paper trial exists to see where the money went. Expect this to go on and on. In the end I expect around 3 Trillion dollars to vanish into the pockets of various players with no recourse for the taxpayer. What a country! And the Chinese and Japanese want to give us even more! It would be scary if it was not so funny first.
Forget the Paper Money, Give Us the Gold!
The rush for the world to get to a zero interest rate environment and allow currency devaluations has some rich people spooked. Add to this the ripoff of various exposed ponzi schemes and those with cash are scared right now. What does one do when you cannot trust the government or fiat currency? You get GOLD and you keep it close. Preferably accompanied by firearms. From the UK Telegraph:
Merrill Lynch says rich turning to gold bars for safety
Merrill Lynch has revealed that some of its richest clients are so alarmed by the state of the financial system and signs of political instability around the world that they are now insisting on the purchase of gold bars, shunning derivatives or "paper" proxies.
Gary Dugan, the chief investment officer for the US bank, said there has been a remarkable change in sentiment. "People are genuinely worried about what the world is going to look like in 2009. It is amazing how many clients want physical gold, not ETFs," he said, referring to exchange trade funds listed in London, New York, and other bourses.
"They are so worried they want a portable asset in their house. I never thought I would be getting calls from clients saying they want a box of krugerrands," he said.
Merrill predicted that gold would soon blast through its all time-high of $1,030 an ounce, and would hit $1,150 by June.
Remember that our economy and fiat money are based solely on confidence and faith. There is no real backing to any of it. Those with the money are probably correct to get their hands on some real gold. If you are a poor soul like me you can go for the baby brother of gold and hold some silver.
Along these lines I would suggest two things that suck, but may be necessary if things really collapse:
1.) Do not store your gold/silver in a safety deposit box. If the government decides to hoard the metals you will get cleaned out without recourse.
2.) Do not declare your metals on home insurance policies as this will leave a paper trail that you in fact possess the bullion. Again, if the government comes for the metals, that insurance readout will tell them all they need to know.
This stinks as you will either have to trust a foreign entity to hold your metals, or you will have to hold them yourself. Obviously this has disadvantages. Tough times make for tough decisions.
Full Disclosure: I own gold miners GG and KGC.
Friday Night Entertainment
A little fun can go a long way.
I was born in 1976, the "Year of the Dragon". While I was putting together some silver bullion buys (trust me, small scale!) I came across these attractive bars from the now defunct Phoenix Mining Co. made by the Northwest Territorial Mint. I love the Dragon emblem and the fine detail in the wings. I try to get these whenever they are on eBay as long as the bidding is in a good bullion buy range:
From the great film "The Highlander" please enjoy the opening duel between Conner Macleod and Iman Fasil in the garage at Madison Square Garden:
We need some tunes to stir the soul and steel the heart. I just made that up, nice huh?
Who can forget the movie "Top Gun"? Here is the signature song for the movie from Kenny Loggins called "Highway to the Dangerzone":
A little Charlie Daniels Band goes a long way. Take a listen to "Stroker Ace" about a race car driver:
It is rare that I like any song better when done by another artist than the original one. "All Along the Watchtower" by Jimi Hendrix rather than Bob Dylan is one. Another is when Randy Rhoads plays the Black Sabbath song "Paranoid" on the Tribute album. Randy gives the song a whole new motion and edge that beats out even the great Sabbath:
If you want to get all riled up tonight, try out Rage Against the Machine and "Vietnow". Warning: fairly rough lyrics, but ripping tune!:
Have a good night.