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Reading Ron Paul's new book, "End the Fed," has taught me something else I didn't know. Karl Marx was a proponent of central banking (which is what the Federal Reserve is). It is 5th on his list of "10 Conditions For Transition To Communism." It reads, "5. Centralisation of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly."

This does not mean that Obama is a Communist. It doesn't mean that those who support the Federal Reserve are Communists. The Federal Reserve was created by bankers and the social elite in 1913. What it does mean however is that those who want to exert their control over others realize the power of controlling the supply of money.

Now the following story may not be a direct result of the Federal Reserve's creation, or it's policies, but I think it highlights how ridiculous the government can become when it comes to regulating our lives (ie. exerting control over others).

State to mom: Stop baby-sitting neighbors' kids

Each day before the school bus comes to pick up the neighborhood's children, Lisa Snyder did a favor for three of her fellow moms, welcoming their children into her home for about an hour before they left for school.

Regulators who oversee child care, however, don't see it as charity. Days after the start of the new school year, Snyder received a letter from the Michigan Department of Human Services warning her that if she continued, she'd be violating a law aimed at the operators of unlicensed day care centers.

The good news is that the community and the state government quickly reacted to the outrage one would expect this to create. They are working with the state legislature to amend it. But the law still exists and was used against Lisa Snyder. It's small things like this that eat away at our freedom bit by bit. And it's the size and growing involvement of the government in our daily lives that makes this possible.

I was working on my computer last night and decided to turn on the TV before I went to bed so I could relax a bit. I was flipping through channels and came across Bill Maher, someone who I generally can not stand. I noticed he had Michael Moore on a guest talking about his new movie, "Capitalism: A Love Story." I though, wow - two people who I dislike talking about something that is really going to make me mad.

But after listening to Michael Moore a little bit, I realized that he is sick and tired of the same things everyone is sick and tired of. The rich are getting richer, and the middle and lower class are having a harder and harder time surviving. He even talked about "corporate welfare" and "crony capitalism", which is exactly what bailouts represent.

I can't speak much too what Moore thinks the cause of all this is because I haven't watched his movie yet, but my guess it he probably doesn't blame the Federal Reserve and inflation. But these are the tools the rich and powerful use to take huge risks, make obscene amounts of money, then socialize the losses when their risks finally catch up to them. It's what allows them to walk away with disturbing bonuses, golden parachutes, and millions in their bank account while we pay for their mistakes through higher taxes and inflation. It's a perfect fit. The concept that the Federal Reserve and their ability to create money (inflation) is what makes all this possible is very simple, yet very difficult for many people like Michael Moore to accept. In fact, it's very difficult for most people to accept because nobody takes the time to understand it. They just blame one side or the other (Republicans vs. Democrats), which is exactly what those in power want.

If one does take the time to look at it though and asks, where does all this money comes from, the answer is simple - the Federal Reserve's printing press. Who runs the Federal Reserve? Wall Street Bankers - the rich and powerful. When any large corporation fails be it GM, GE, or Goldman Sachs, the government and/or the Federal Reserve floods that company with money, something that can only be done through the printing press. It's been going on for decades - since 1971 in fact when we finally got rid of the gold standard. The top 1% get richer and everyone else pays for it through higher taxes and inflation. I think people are starting to realize this because things keep getting worse and worse and blaming Republicans or Democrats isn't doing any good. This give me hope for the future.

My guess is that if Michael Moore could be just a bit open minded (I'm not saying he can't, just that it would be required) and he had an honest conversation with Ron Paul, I think Michael Moore would want to end the Fed too. Now wouldn't that be a powerful combination.

The late Milton Friedman on the four ways we can spend money and why government welfare programs are so inefficient. In this case he was talking about public schools, but it can be applied to anything (health care included).

Milton Friedman was originally a believer in Keynesian theory (government consumes instead of consumer in economic downturns), but reinterpreted the Keynesian consumption function in the 1950s which challenged the basic Keynesian model. Keynesian economics is what our government uses to justify inflation and deficit spending. And by our government, I mean both Republicans and Democrats, past and present, with few exceptions.

(via RedStateEclectic)

An article from the Huffington Post of all places...

Why the Dow is Hitting 10,000 While Everyone Else is Cutting Back

So how can the Dow be flirting with 10,000 when consumers, who make up 70 percent of the economy, have had to cut way back on buying because they have no money?
[ . . . ]
The explanation is simple. The great consumer retreat from the market is being offset by government's advance into the market. Consumer debt is way down from its peak in 2006; government debt is way up. Consumer spending is down, government spending is up.

It goes into a bit more detail, but that is the main point. Anyone still investing in the market should be very cautious. Once government spending comes to a halt (it has to at some point, one way or another), these companies will once again have to shrink down to size. Their values will shrink with them.

I heard on the radio this morning that the government is going to spend $18 million dollars on a Recovery.gov 2.0 redesign. It's a 5 year contract, so that's $3.6 million a year. As a web developer, I can tell you right now that the government is wasting a huge amount of money on the web site that is meant to curb waste. If Archrival had $3.6 million to spend on building a web site, I honestly don't know what we would spend it on. And $3.6 million a year? They have to spend that much every year? Wow.

I found an article that compares some other web sites and their costs to recovery.gov.

FedSpending.org, launched in October 2006 with a meager three-year $334,272 grant from the Sunlight Foundation, is a voluminous online database of all federal grants and contracts. And, unlike Recovery.gov, the website monitors the entire federal budget, and does so at a fraction of the projected cost of Recovery.gov.

Of course, the revelation that the private sector outperforms the federal government is not new. Recovery.org, a project of Onvia, monitors the flow of recovery funds from the federal government to private businesses in real-time, unlike its overpriced government counterpart which reports spending 100 days after-the-fact, thereby enabling wasteful or fraudulent spending.

Onvia's CEO Mike Pickett estimated in May his company spent approximately $20,000 to build Recovery.org's tracking infrastructure, a far cry from the inflated contract awarded by Obama's White House.

The worst part is, the government is using this web site as an example of stimulus money being used effectively. Eighteen million dollars is nothing to the government anymore. Therein lies the problem.

I read in the Omaha World Herald today that Nebraskan's real income rose last year. I think we were in seventh highest overall. I also noticed that Washington D.C. was second highest. Shocker.

I recently wrote about higher education and how the government is trying to take over. I explained that giving more loans to students at lower rates was going to make an existing bubble worse.

On NPR this morning I was surprised to hear someone actually talking about the education bubble. They said that tuition is rising so fast because of the availability of student loans. I almost jumped for joy! It seems like everyone thinks the answer to our problems is government help in paying for things that are too expensive. Here was someone saying that this might actually be causing the problem. It was rewarding to hear someone in the media actually say this for once.

It use to be that a college education meant a good job with high pay. That's not true anymore. This is partially because there are so many college students/graduates compared to the past. If everyone has a college degree, it doesn't mean as much. You're still better off with a college education, but one needs to carefully consider the cost of that education because you may not be able to pay back the debt incurred. To put the increasing costs into perspective, tuition is rising faster then medical care.

It's actually very similar to the housing bubble. Give lots of people access to cheap loans backed by the government with super low interest rates, and demand goes way up. When demand goes up, prices go up. The more money artificially put into the system, the higher the prices rise. A bubble.

The default rate on student loans recently jumped from 5% to 7%. With the economy the way it is, the more students graduate without a job, the more they will default on their loans. This is when the bubble will burst. Tax payers will be stuck with the bill and Colleges and Universities will need to shrink dramatically. Some will even go bankrupt - if the government lets that happen.

I was reading "End the Fed" by Ron Paul last night and found the following passage very interesting.

As Mises wrote in 1919, "one can say without exaggeration that inflation is an indispensable means of militarism. Without it, the repercussions of war on welfare become obvious much more quickly and penetratingly; war weariness would set in much earlier."

Armed with central banks to cover liabilities, European governments began a war one year after the Fed was created. The New York Times wrote with horror: "The world looks on in a stunned, incredulous way while Europe is rushing forward to a stupendous catastrophe, . . . We have been told again and again that the financiers of the word, largely denationalized in their sympathies and interests, would never permit the great nations to impoverish themselves by a general war. A tightening of the screws of credit, it has been said, would bring most chancelleries to their senses."

It was once so, but central banking changed that forever. No more would governments be bound by the fear of bankruptcy and financial ruin. The magic of inflationary finance would provide for them no matter what.

How long have we been at war with Iraq and Afghanistan? How much has it effected our daily lives? These wars have a great deal to do with the collapse of our financial system. Yet even after this catastrophic collapse, inflation keeps us at war and keeps the majority of us from feeling its effects.

I often think this applies to poverty as well. Inflation is an indispensable means of hiding how bad things are. In the great depression, we were able to see poverty. People stood in unemployment lines and bread lines. The state of the economy was very obvious. But lessons were learned. Now, unemployment benefits keep those who are unemployed in the home instead of out trying to find work. Food stamps keep the unemployed in the grocery store instead of bread lines. Unemployment is currently at 16.8% as measured during the Great Depression (u6) and is expected to go higher. But with the power of inflation, the power to print money and give it out to anyone, we don't see it. Inflation is a powerful tool that allows governments to do whatever they want. Unfortunately, history is repeat with the economic collapse of the countries with the ability to wield this power.

I just heard a story on NPR that made me wonder what planet politicians are from. House Bill Lets Students Bypass Private Lenders.

The House is expected to vote on a bill Thursday that would let students borrow directly from the U-S Treasury - instead of from private lenders subsidized by the government. House Democrats say this would save millions in the long run. But the bill has opponents in the loan industry - and obstacles in the Senate.

This absolutely blows my mind! Here is the reasoning behind the bill. The government backs a vast majority of student loans in the United States. This means banks lend students money who are at high risk of defaulting on the loan - the reason for government backing. When the students eventually do default on their loan, banks get to keep the profits while the tax payer (via government backing) is stuck with the bill.

So, the solution according to Washington is to take out the middle man - the banks. This will include Nelnet btw, which employs about 1000 people in Nebraska including several of my friends. Under the proposed bill, students would get loans directly from the Treasury Department. The government would then be able to offer lower interest rates and reduce lending standards even more, which would allow more people to go to college. The government and tax payers would "save" the billions of dollars the banks were making off the loan defaults because the evil profits would be eliminated.

Do I even need to say what the obvious problems with this would be? I hardly know where to begin. First, it's not savings. The lawmakers writing this bill already have these "savings" spent. In fact, that's one "problem" with the bill in the House, everyone wants to get their hands on that money and spend it. They're tripping over themselves and getting in each others way to get their hands on it. This is proof they aren't concerned with our tax money at all. It's a bold faced lie. That money should go to the bad loans! That's the whole point of the bill!

Second, by giving out more loans at lower interest rates, they are going to create an even bigger education bubble then we already have. Colleges will grow bigger, hire more teachers, buy more equipment, and enroll more students. Over time, they will need to maintain the buildings, pay the teachers and replace the equipment. Since everyone is already enrolled in college who wants to go, they will need to raise tuition. This will cause more students to get government loans (who in their right mind would lend someone without a job $50,000 - $100,000 to get a sociology degree that might earn them $30,000/year?), cause more defaults, and require more tax payer bailouts. Then there will be talk about a "public option" in education because nobody can afford it. College will become a "right" of every American.

The fact is, a lot of people aren't cut out for college. Standards are so low now, and money so easy to get, that only 54% of students who enter a 4 year program have a degree 6 years later. College is becoming so expensive, that it is ruining students financial futures before they even have a chance at getting a job. This bill will exasperate the problem.

If this happens, the next obvious step is with housing. Why should all these banks be making money off government backed loans people can't pay back? I have pointed out numerous times how the government is already backing the vast majority of new loans. And isn't owning a house an American "right" already?

I won't even go into the fact that the U.S. is already broke. This is absolutely unbelievable. If you work at Nelnet, you might want to consider calling your representative today before they get a chance to vote.

I heard Howard Dean on NPR say that Canada pays 10% of GDP for health care while the United States pays 17%. Therefore, there is plenty of fat to cut and paying for more health care shouldn't be a problem.

If it's such a simple solution, why haven't we cut the 7% fat already? Let's just do that first, then see how things go from there before adding $1 trillion + to the deficit every 10 years.

A few weeks ago, the United States was granted access to 7 military bases in the country of Colombia. The Colombian senate wasn't informed, and frankly, not many in the U.S. Congress were either. It all just kind of happened. Not much has been reported about this in the news, but it should be of great concern.

I'll start by saying I have a new found respect for the peace movement, although my reasoning may be slightly different then most. I used to support our foreign policy, but have great difficulty in doing so now. War is immoral and causes great harm, not only to our country but also to the countries we invade. The loss of life and property are appalling, even with the most accurate weapons we have today. Innocent people still die, and whether it's by the hands of a U.S. soldier or from a radical suicide bomber, it happened because we are there. War should be an absolute last resort. For anyone with a religious background, this should be a no-brainier. WWJD?

But war and military expansion are also incredibly expensive. We have over 600,000 troops in over 130 countries, not including Iraq and Afghanistan. Our military budget keeps expanding every year. If you have ever read anything about our founding fathers, they were very skeptical about entangling alliances, a standing army, and involvement in foreign wars. They understood the costs, both financial and personally. Financially, inflation is how war gets paid for which is the root cause of countless economic collapses throughout history. Personally, it costs us the lives of our children our freedom.

Just like inflation, damage to our freedom is done incrementally. When there is conflict, this freedom or that is taken away to "keep us safe." I often hear the argument, "if you aren't doing anything wrong, you don't have to worry." Once a liberty is taken, it is nearly impossible to get back. During times of war, freedom is under its greatest attack. In 1775, Patrick Henry famously wrote, "Give Me Liberty Or Give Me Death." Have we become so soft that this is now meaningless? Personally speaking, death is something I'm going to try and avoid. But I'd rather die in a terrorist act then give the government permission to listen to my phone calls. Freedom is all or nothing in my opinion.

And finally, war is the best way to hide failed policies at home. It's the perfect smoke screen for politicians to divert attention away from unemployment, corruption in government, high taxes, or anything else we would normally be concerned with.

For all these reasons, I saw the expansion of our military to Colombia as a reason to be concerned. South America isn't exactly a stable continent. Not only does Venezuala control a vast quantity of the worlds oil, it's also controlled by a fairly unstable dictator who has essentially granted himself unlimited power over his country in the name of socialism. Many of the countries in South America are run by drug cartels and governments that are highly corrupt. Some countries like Brazil are quickly becoming economic powers to be dealt with. Brazil is one of the countries often referred to as BRIC (Brazil, Russia, India and China), a group of fast-growing economies that are able to wield greater influence then in the past. As America falls deeper into debt, the policies of these countries could dramatically effect the value of the dollar and our economy as a whole.

Today I heard that the United States is afraid recent arms purchases by Venezuala could spark a regional arms race. From the article, "The Russian government Monday extended $2.2 billion in credit to Venezuela to finance arms purchases, including 92 Soviet-era T-72 tanks and short-range missiles with a reach of 55 miles (90 kilometers)." This is a direct result of our recent actions. Crazy or not, Chavez sees our dramatic increase in the region as a threat to his rule. Is this really what the United States needs right now? More war? More debt? I don't think so. This is something we should all be watching.

Today, Obama told Wall Street, "Instead of learning the lessons of Lehman and the crisis from which we are still recovering, they are choosing to ignore them."

First, I think the banks DID learn a very important lesson. They have been learning the same lesson since 1913. Banks will get bailed out if they fail, especially the big banks. When they fail, the people at the top will walk away will millions of dollars in bonuses and get to keep all the money they made by taking huge risks. That's why the Federal Reserve was created after all, to supply money to banks so they don't go under. Unfortunately, this time banks needed a lot more then usual to survive, and they will continue to need more because there is no real chance of failure. Banks need to be taught a lesson, the lesson of risk. Maybe if the CEO and Board of Directors felt that they would lose everything if a bank failed, they would scrutinize who they gave loans to or what kind of assets they bought. Maybe if the government didn't guarantee so many home and student loans, banks would care what securities were comprised of and securities based on sub-prime loans wouldn't get AAA ratings.

Second, Obama is talking about the need to learn lessons, I want to know why the government didn't learn any lessons from the housing bubble? Read Banks Load Up on Mortgages, in New Way. They are doing the exact same thing that the private sector did. It's insane! See my previous post, "Home sales up 9.6% is NOT Good News."

FACT CHECK: Obama uses iffy math on deficit pledge
This isn't just an Obama problem, it's a government problem. Republicans, Democrats, they're all guilty. It just so happens that Democrats control things right now.

Only-in-Washington accounting...

House Democrats offered a bill that the Congressional Budget Office said would add $220 billion to the deficit over 10 years. But Democrats and Obama administration officials claimed the bill actually was deficit-neutral. They said they simply didn't have to count $245 billion of it - the cost of adjusting Medicare reimbursement rates so physicians don't face big annual pay cuts.

Their reasoning was that they already had decided to exempt this "doc fix" from congressional rules that require new programs to be paid for. In other words, it doesn't have to be paid for because they decided it doesn't have to be paid for.

The same day I receive "End the Fed" by Ron Paul, Barney Frank announces the House Financial Services Committee will hold hearings on H.R. 1207,
Ron Paul's bill to audit the Federal Reserve. The hearings are scheduled for Friday, September 25th at around 9:00 am.

House of Representatives to Hold Audit the Fed Hearings

I may have to set my DVR to CSPAN!

On a related note (since unemployment is directly linked to the Federal Reserves policies), I heard NPR today talking about how unemployment is nothing like it was during the Great Depression, citing unemployment statistics of 25% unemployment then compared with 9.7% today. NPR is comparing apples and oranges. Unemployment as measured during the Great Depression is actually at 16.8%. See the U6 line of the government's numbers. I realize not many people understand how the numbers have been manipulated, but this is truly poor reporting. Taking what the government says at face value, without digging under the surface at all.

Instead of me explaining it again, I'll let Peter Schiff do it.

It all reminds me of a quote from John Adams, Second President of the United States.

"All the perplexities, confusion and distress in America
arise not from defects in their Constitution or Confederation,
nor from want of honor or virtue, so much as downright ignorance
of the nature of coin, credit, and circulation."

I just found this article, The Next Financial Crisis, It's coming--and we just made it worse.

It's about the Federal Reserve, interest rates, and the problems associated with bailing out banks that take huge risks. It briefly examines the history of the banking system, Fed's role in the Great Depression, and how through successive lowering of interest rates, it has set up the economy for worse and worse financial crises. This quote from the article seems to say it all...

Over the past century, we have moved away from a system where bank shareholders and senior executives paid dearly for bad management--and toward a system where fired bank bosses make off with fortunes or launch brilliant political careers. No one is on the financial hook, other than the taxpayer. Consider the case of Citigroup, a seriously troubled bank. Chuck Prince, the CEO who fell flat on his face, walked away with close to $100 million. Win Bischoff, former chairman and interim CEO of Citigroup during the debacle, has just been appointed chairman of Lloyds Banking Group in the United Kingdom--reflecting the high esteem in which he is apparently still held. And Robert Rubin, Treasury secretary under Clinton, made over $100 million as board member and chair of Citigroup. In an interview late in 2008, he brushed off any responsibility for the mismanagement of anything. And so, our recurring financial crises are not isolated random events; they emerge from a pattern of private and public sector behavior. Enabled by the Fed, our system's tolerance for risk is out of control. This is an increasingly dangerous system. It is only a matter of time until it collapses again.

On this blog, I point to a lot of dire news and have a pretty negative outlook on the economy. A lot of people tell me it's not going to be so bad and that I'm too pessimistic. I don't think I am, so I'm going to try to explain where my pessimism comes from. I'll break it up into multiple parts because I have a feeling it will take a while to explain.

To understand what has happened, we first need to understand how the economy is supposed to work. Once this is understood, it's easier to see the problems in our current economy. I'll begin with the artificially low interest rates set by the Federal Reserve. The Fed often refers to interest rates as their primary tool to help "stabilize" the economy. While it may do so temporarily, in the long run it only makes things worse.

The Roll Of Savings
Traditionally, banks use the money we save to lend to businesses. Businesses use this money to create products, replace equipment, or expand their operations. They agree to pay back the money lent to them with interest. Since banks use our money, they pay us a part of the interest they receive. This encourages saving. What is left over is the banks profits. As demand for savings and loans fluctuate, so do interest rates. Let's look at this process in a little more detail.

The Business Cycle
When interest rates are high, it's because bank reserves (the amount of money we save) are low. Banks raise interest rates to entice us to save. Since there isn't a lot of money available, businesses are willing to pay more for a loan, but may borrow as little as possible because of the high rates. Over time as we save more and businesses take out fewer loans, interest rates start to drop. Loans become cheaper and businesses can take out loans to replenish their inventory, replace equipment, or expand their business. Businesses also know that as interest rates continue to drop, we will save less and spend more because it's not as beneficial to keep our money in the bank. Businesses produce more goods and we buy more goods. As we spend our savings, bank reserves begin to drop. As bank reserves drop, interest rates begin to increase, we will begin to save, and businesses take out fewer loans. The fluctuations in interest rates are relatively small, and keep the economy humming along.

Bubbles and Recessions
Sometimes businesses make mistakes and invest money where they shouldn't. For instance, say there is a small town with one restaurant. One day, the circus comes to town. All the workers at the circus and visitors from other towns frequent this restaurant. The restaurant owner makes the mistake of thinking this influx of business is permanent. He adds on to his restaurant and hires full time help in the kitchen. Since demand for his food has increased, he is able to raises prices. Wages for restaurant help may also increase as there is more demand for this kind of labor. When the circus leaves, business drops off. The restaurant must close off the extra seating, lower its prices, cut wages, and layoff the extra workers. Without doing so, he will go out of business. Mistakes happen. When they do, bubbles form. When the bubble bursts, the market corrects itself through a recession.

The Federal Reserve
Bring in the Federal Reserve. For whatever reasons, some economists think it is necessary to keep bubbles inflated. Without doing so, deflation occurs (oh the horror!). In our example, there is downward pressure on prices and wages. Although this necessary correction is healthy for the economy and the restaurant, the Federal Reserve's mandate is to stabilize prices and maintain full employment. To do this, they lower interest rates to encourage consumption. Since interest rates are lower, people will save less and continue to go to the restaurant, maybe even pick up the slack from the missing circus employees. The restaurant will maintain it's higher prices, retain its employees, and keep the entire restaurant open. Here comes the problem.

Because there wasn't a correction and things are going well, the business owner may decide to expand again. Remember, when interest rates are low, businesses see it as an opportunity to invest. Maybe the drop in interest rates was so effective that the remaining people in the town picked up the slack and then some. They continue to spend their savings because it isn't worth keeping money in the bank. Now the business cycle is broken. Consumers are spending more of their savings then they normally would, and the restaurant is expanding it's business. The bubble has been reinflated. Left alone, interest rates will again rise due to less money in the banks. When this happens, the local economy will again contract, except things are now worse then before. The recession becomes more painful.

Cue the Federal Reserve! To keep a worse recession from happening, the Federal Reserve again lowers interest rates. People spend more and business continues to grow. But these interest rate cuts are not sustainable. Eventually, consumers run out of money and enter into debt, and the restaurant is so big, any decrease in demand and there is no way it can keep from going out of business. It must liquidate it's assets and pay off its debt.

This is what has been happening to our economy for quite some time. The Federal Reserve continues to try and inflate our bubbles Instead, it is preventing necessary market corrections.

In my next post, I'll use the housing bubble as a real world example of what happens when low interest rates are kept too low for too long. Part II: The Housing Bubble.

P.S. I should note that the example of the circus is from Peter Schiff's book, Crash Proof. It's a must read if you're truly interested in what I'm talking about.

Even in all my reading, I'm still not 100% sure what exactly the Federal Reserve is or how it works. From what I understand, it's a system of 12 banks with the New York Federal Reserve Bank in charge. But is it a private or public organization?

Recently, the Bloomberg news service sued the Fed under the Freedom of Information Act to find out which banks money was given to and on what terms. The New York Fed responded by saying that it is a privately owned entity so isn't covered under the the Freedom of Information Act. A judge rejected this argument and ordered the information released by Aug 31st. It still hasn't happened. The reason, the Fed Board of Governors says, "We don't control the system of record-keeping in New York" so they can't find out who was given what money. More here.

This is our monetary system we're talking about, the foundation of our economy. Poor monetary policy brought down the Rome Empire, the Persian Empire, the USSR, Germany after WWI, and a host of countries throughout history. And we aren't allowed to see what is happening? The Board of Governors of the Federal Reserve can't find out in a timely fashion, where our money is going? There are 416 small banks on the watch list for failing banks. The Fed only gives money to a privileged few. When these smaller banks go under, the FDIC (read tax payer) buys up all their bad assets, and larger banks buy the good assets for fire sale prices. Shouldn't we know who is benefiting? Who is getting all of this money?

Ron Paul's book, "End The Fed" just came out. It is currently #23 on Amazon's top selling book list. My copy is in the mail, and should be here next Thursday. I can't wait to read this book. Anyone interested in our future, or the future of your children, should do the same. This is an important book.

Federal Government Needs Massive Hiring Binge, Study Finds

Really? The massively bloated federal government, which already employs more than 1.8 million people, needs to "binge"? Amazing.

- Read "More Bad News".

John Stossel, you complete me. He points to an article that sites a study saying the government needs to hire about 600,000 more people to implement everything Obama is trying to do. Wow. I like his point about the government waging a "war for talent" with the private sector. Not what our economy needs during a recession.

According to Representative Pete Stark (D) of California, the more we increase our debt, the wealthier we become. If that doesn't make sense, it's probably because you don't have a Masters degree or PH.D. in economics. If you don't have a degree in economics, and if you don't agree with him, look out because he might decide to throw you out his effing window.

Ok, moving away from the economy for a minute to an even more nerdy subject, programming. I wrote a nice little jquery script today that might come in useful for someone. I'm not really sure what you call it though (text field hints? watermark?), although I can explain what it does.

Sometimes you'll see a text field in a form with instructions for what you're supposed to type, except in a light gray. Then when you click on the field, that text goes away and you can type. If you move your mouse away without typing something, the text comes back.

I wrote a script that makes implementing this on as many fields as you want, super simple. Here it is:

$(document).ready(function() {
    $(".inst").each(function(i) {
        var beginStyle = $(this).attr("style");
        $(this).attr("style", "color: #bbb;" + beginStyle).val($(this).attr("title"));
 
        $(this).bind("focus", function(e) {
            if ($(this).val() == $(this).attr("title")) {
                $(this).val("");
                $(this).attr("style", beginStyle);
            }
        });
        $(this).bind("blur", function(e) {
            if ($(this).val() == "") {
                $(this).attr("style", "color: #bbb;" + beginStyle).val($(this).attr("title"));
            }
        });
    });
});

To use it, make sure you include the jQuery library on your page and put this script in the header. For any input text field you want this feature applied to, add the class "inst". Use the title attribute to store the hint you want to use for that field.

<input type="text" name="txtFname" title="First Name" class="inst" />

That's it! Hit me up if you have a question or don't understand something. Also, this assumes you know a little bit about jQuery and programming.

Bailed-out bankers to get options windfall: study

The top five executives at 10 financial institutions that took some of the biggest taxpayer bailouts have seen a combined increase in the value of their stock options of nearly $90 million, the report by the Washington-based Institute for Policy Studies said.

"Not only are these executives not hurting very much from the crisis, but they might get big windfalls because of the surge in the value of some of their shares," said Sarah Anderson, lead author of the report, "America's Bailout Barons," the 16th in an annual series on executive excess.

This is where our taxes are going.

FHA on track for busiest year as it backs 23% of mortgages

Approvals for purchases, refinancings and reverse mortgages rose 70% to 1.67 million.

Eighty percent of the FHA mortgages for purchasing homes went to first-time buyers drawn to the FHA's low-down payment requirements, starting at 3.5%. Private lenders making conventional loans typically require at least 10% down.

The FHA's market share, about 3% in 2006, has swollen to more than 23%. With credit still tight, many borrowers could not get a mortgage without FHA help.

This is why housing prices and sales have steadied and/or increased. The private sector sort of learned a lesson about giving people loans who shouldn't have them, but the government didn't. Need a loan but can't qualify because you have no money? Call the FHA.

Ford sales up 17%, GM down 20% and Chrysler down 15%. I think it's pretty clear people are very suspicious of the government owned car companies. But the real winners where Subaru and Hyundai at 52% and 47% sales increases, with Honda and Toyota coming in with 9.9% and 6.4% increases respectively.

Via "NOW WHAT DO WE DO FOR CARS?"

The article also points out, "dealers prematurely exhausted a shrinking pool of new-car buyers and won't likely see any demand return until next summer."