Category: Current Affairs

[Update: Be sure to read Dan Newman’s comment to this post! Dan was the author of the op-end and has his own blog here.]

Small business owner Dan Newman writes an op-ed in today’s Washington Post advocating that the government issue gift cards to help stimulate the economy.

Unlike the earlier stimulus checks, Newman’s proposed American Gift Card couldn’t be deposited into your bank account and saved – you’d only have the option of spending it.

By sending every taxpayer a $2,000 debit card, the government stimulates spending directly. The card doesn’t get deposited with a bank, a step that greatly reduced the use of last year’s rebate checks for new spending, and with a defined expiration time, perhaps a year, the program could help precisely while other programs get underway.

The American Gift Card could bear a picture of Lady Liberty, since it may be used for whatever taxpayers wish: smarter clothes, dinners out, a weekend away, a new heater. And as gift cards tend to be used in person, they are of particular interest to local businesses.

A nice, creative idea!

The Feds could time the release of the gift cards – a Presidents’ Day gift card, Memorial Day gift card, Labor Day gift card, generic Winter Holiday gift card, and even one on your birthday! This idea has legs!

Up too early this morning – reading Steve Ballmer’s speech to the US House Democratic Caucus Retreat yesterday in Williamsburg (how did that get arranged anyway?).

In our opinion, in order to reach the reset point, three things need to happen. First, the economy must be deleveraged. Private debt as a percentage of GDP has to be reduced. Restoring health to the nation’s financial system is a fundamental part of this.

Second, confidence must be restored. The stimulus package, in my opinion, is vital. It will provide a cushion as we reach the reset point and it will help restart our economic engine.

Third, America really has to return to growth that’s built on innovation and productivity, rather than leverage and private debt. That must happen.

I couldn’t agree more with Peggy Noonan:

One senses in a new way the disaster that is Nancy Pelosi … her public comments are often quite mad — we’re losing 500 million jobs a month … — and in a crisis demanding of creativity, depth and the long view, she seems more than ever a mere ward heeler, a hack, a pol. She’s not big enough for the age, is she? She’s not up to it.

Even Pelosi’s hometown paper wonders. Time to move on…

And, don’t get me started about Harry Reid. Jeez…

Not a pretty picture this morning with the loss of almost 600,000 jobs in January and an unemployment rate rising from 7.2 to 7.5 percent.

Let’s hope we’re nearing a bottom in this economic crisis. There’s that word again: “hope”!

I love this post by Dan Roam titled “An Aeronautical Miracle for the Rest of Us“!

Like Peggy Noonan, I was disappointed that the passage of the stimulus bill in the House earlier this week was so one-sided (no Republicans in favor). Seems like this could have and should have been handled differently!

In his column titled “No Time for Poetry” in the New York Times this morning, Frank Rich writes, among other things, about the Blackstone Group – stock symbol BX – and how the 60th birthday bash for Blackstone’s Steven Schwarzman became a symbol for the end of our last Gilded Age of prosperity.

http://charts.wikinvest.com/wikinvest/wikichart/javascript/scripts.php

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View the full BX chart at Wikinvest

Rich concludes:

“…it is past time for us to realize that our own test is also about to begin.”

The latest monthly stats are in – for December 2008 – and the unemployment rate in California is a very ugly 9.3%.

Take a look at this chart from the Los Angeles Times:

Does any word other than “skyrocketing” come to mind?

This is serious stuff – this level of unemployment (and particularly the slope of that line) does great damage to any hope of significant recovery in the near term.

Meanwhile, the elected representatives at the state level can’t even agree on a budget – with the state of California projected to run out of cash in something less than four weeks. What a zoo!