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Every time in history, in peacetime, when government spending exceeds 20% of GDP it is always the case that economic growth slows.
Hard to argue with that statement cfs.
If you are an employee in the private sector everyday is a challenge to keep your job but if you go from the private sector to a government job you soon lose your incentive to work hard because government workers can go to work and do nothing all day if they so chose and still remain on the payroll with all of their benefits and pensions. Got a problem with me not working buddy let’s just contact “The Human Rights Department” and sort this out. The unions are there to represent you if a contrary problem should arise. On and on it goes until the guy who wants to work is sidelined by his fellow government workers.
How about self-employed in the private sector? For the past 35 years I have had to provide really valuable service to our clients. I have had no unions to help me. And, you know what, I am very glad of that fact!
If you had a union…you would have to have a bowling league…..and buy the shirts for the boys….
Would I also have to drink cheap beer and smoke cigarettes!
Yes…..and you have to pretend you like it….and do not forget the turkey at Thanksgiving and the ham at Christmas….and the year end bonus….from all the
extra money they think you are making off them….
The garbage collectors in my major metropolitan area had until recently a government job contract for life. This issue has been addressed in the west end but so far the negotiations to change this provision won’t be addressed until next year in the east end provided the vote happens. Think of this how many of us have a contract to keep our jobs for the duration of our life or until retirement. HUH!!!!!!!
That is absolutely amazing!
Those contracts also come with lavish pensions which you never find in the private sector but they expect their neighbors who are out of work or underemployed to continue to pay for them. We need more Scott Walkers to stop this insanity.
Of course, I agree with this comment!
I agree 100% with Ron. Paying government workers is in fact a transfer of wealth from the tax payers to the government workers. Also, a government worker does not produce anything so is a drain on the economy.
For the most part I agree with you Karen.
Not really in the case of teachers, fire”people”, police, and others who are truly there for the public.
They may have value but they belong to the public sector which is paid by the taxpayers. They have negotiated unsustainable contracts which their neighbors supporting them can no longer afford. As far as I am concerned their pay and pension far outweighs their value.
My comments were not related to compensation. My mistake, I should have made that clear.
Karen…..I AGREE…NICE COMMENT…NO GREAT COMMENT….
If you went from a job in the private sector to a comparable one in the government you would think, ” my, I have just died and gone to heaven.”
I personally value my independence way too much!
Personally I fovour unions, obviously I dont like to see them corupted. But I would like to point out that militarys are also government employees and I agree with Ron Paul these people need to be reduced. I agree with your statement Al, but I would say that government employees are sometimes vital.
I saw Krugman on tv last night stating that the government needs to hire more people to help the economy, I too think he is nuts in that regard. I would say his idea would be misalocation of funds.
I do agree benb,
Some government workers, as I responded to Karen, and absolutely necessary.
Al: Reading Paul Krugman all the time will cause you to start drinking. It is better to just read him once in a while after your drunk, then it will make more sense.
Really, Paul is going down in the economic history books as one of the worlds biggest jokes right after the Nobel Prize committee.
Does anyone on this page wonder what goes on in the minds of people like Krugman? Better to get drunk first before considering what.
I know a lot of people who think he is brilliant!
Not sure if drinking would even help. The sad fact is I feel the same way about the main stream media as well.
You really nailed out of the park with that last sentence. The MSM is an absolute joke and it is really beginning to look like a really, really bad (B-rated) horror flick.
Hey common Marc,
Let’s not get personal. I happen to like B-rated horror flicks!
Booze can be your best friend or your worst enemy as a doctor once pointed out!
i thought you might find Steve’s comments today of interest
He writes a daily letter. tks for your great work. john boyce
Re: Chapter II of Survival
From: Steve Dowdney
To: Steve Dowdney
Date: Tue, Jun 19, 2012 5:52 am
Two years ago a reader bought from me one of my canning books as a Christmas present. Instead of cash for payment he sent one silver 1 oz. coin, then worth about $20. At one point the book sale could have netted me $38, a near double but knowing what I know and fearing what I know will someday come I took it as manna from heaven and began my stockpile of both gold and silver. To solidify my thinking he also enclosed a foreign currency note. The bill at one time traded close to dollar for dollar with U.S. currency. But this one was only good for a loaf of bread and was a 100 trillion dollar Zimbabwe note. This is the end result of what is called hyper-inflation. It often comes after a period of deflation and is the result of loose and reckless monetary policy-the course our leaders (both pasrties) have chosen. It is not an unusual phenomena. I read today (Casey Researh) that about every 3.5 years a national currency experiences hyper-inflation. I read a lot, I think too much and my conclusions, although so very often correct, sometimes come so far after the emotions in which they were conceived, and therefore, I, many times, miss the benefits of my abilities. I will not this go around. Just to put hyper-inflation into a historic and much recorded frame, the Wiemar Republic went through a period of deflation following defeat in 1918. It was followed by hyper-inflation. Over a three year period one once of gold purchased before inflation cost 170 marks. By the end of the period that 1 oz. was worth 71 trillion marks. This is the problem with fiat currencies. Hard assets that hold value AND can be swapped for living supplies follow the inflationary rise of the currency but money assets don’t losing value wiping out the bulk of national capital. Some hard assets don’t work. The man with a portfolio of Ferrari’s might be doomed. So might be the art collector. Assets that can be traded for medical, food, clothing and the like work best. I suggest reviewing Maslow’s hierarchy of needs. Stick near the lower three base groups and plan. On every one’s survival list there should be enough tradable assets to survive for several years. Plan now, gather next and be prepared. On a sailboat at sea every prepared sailor has a ditty bag hanging in the companionway. It is the emergency collection of his perceived necessities and is ready to be grabbed as he jumps from the sinking boat into the life raft.
The market yesterday was hardly a “grab the ditty bag and jump overboard” market. A small decline on light volume did little. The RSI dropped to +6 BUT the RO rose in a falling market to +24. Could this be a prelude to a rally? EXTRA-EXTRA READ ALL ABOUT IT: VIX sported the biggest decline of the year from a high of 21.98 to a low of 18.24. What does this portend? Like the rising RO most probably a rising stock market with low volatility. Both SPX and Dow MACD’s are rising and are in neutral positions; same goes with their relative strengths-rising and neutral. On a negative note SPX hit the 50 day ma but backed off. The Dow on Friday punched thru but gave up the gain yesterday and too is under. This is a formidable technical trading barrier and if penetrated the market should move to 13,000. Gold waxes philosophic about the whole international mess. It got ahead of itself and a generation of bugs have now been exterminated. Next the sprayers will get the eggs. Range bound until currency dilution rears its head or the perception that its on the way, purchasing on dips is not a bad thing. A bank account in inflationary periods is wiped out but a one once coin is small, can be used as jewelery is easily convertible and 1 pound of gold (12 coins) $20,000 fits with ease into the ditty bag of land locked sailors.
Excellent, valuable commentary and advice!
Thanks again Butler Investor!
That was an excellent interview!
Yep, Dennis M. it was. Ron is a very knowledgeable guy.
an atty I know became a state legislator for the retirement benefits-nuff said
…suppose Al…there was no greed in the system, uncontrollable levels of outlandish risk takers both from the bankers/the public..suppose the economy was stable…would we say all these things about lazy unproductive government workers…from whence did this all source ?? in kind I like the presenter;s position and he uttered some nice contemplative ideas…but the issue of public servants and government size as a problem was the result of the financial crisis and now is the symptom of our discord…if there was no debt crisis we wouldn;t be having this discourse..people in the main do what they need to earn an income and we are not all blessed with creative invention but many of us do our best with what we have..money in the hands of the poor is spent because its all they have..so in a way they create the velocity of the money supply within the system albeit the banks that were lent the money assumably by the public treasury held onto their money was perhaps slowed down the velocity of money in the system because they were not lending it out…but probably parked it in higher end treasuries and trading in their own self professed platforms (probably using algorithmic personel)…we have so many targets in this stock market, so frenetic so inescapably hopeless..we need a real Leader somewhere…hope and faith ..we desperately need leadership…thanks big Al for your blog…you have a great group of people here..very erudite and mostly very polite …IMHO only
Thanks for the kind words and great commentary Mike M!
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Many thanks Donna,
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