The Federal Reserve and Timothy Geithner have said, on a number of occasions, that the economy is starting to show signs of a recovery.

Remember the “Green Shoots” Bernanke observed?  Remember how everyone was curious as to why THEY were not seeing said green shoots? I’m guessing you do, and I am guessing you are still not seeing them.

Well, over the weekend the White House appears to have ripped the green shoots of a recovery and tossed them aside – there will be no recovery for those in the job market until 2010.

Speaking on C-SPAN, Christina Romer, chairwoman of the White House Council of Economic Advisers, said that she expected theG.D.P. to begin growing in the fourth quarter of this year. Ben S. Bernanke, the Federal Reserve chairman, made a similar prediction last week.

But Ms. Romer also said that she expected unemployment to rise even after the economy turns, saying that the G.D.P. has to grow at a rate of about 2.5 percent before unemployment will fall. Before that happens, she said, it is “unfortunately pretty realistic” that the unemployment rate could reach 9.5 percent. A reasonable estimate for the G.D.P.’s growth rate in 2010, she said, is three percent.

9.5% on the unemployment in 2009?  To me that seems less than realistic.  

I’ve said a number of times that I expect to hit 10% by the end of this year. If the nation sees a loss of another 1.1M people by 12/31, the U.S. Unemployment rate will end up at roughly 10.2% 

Here is the big question, though: Will the government switch people from “unemployed” to “underemployed” (those who have given up hope and are no longer looking) in order to keep the reported unemployment rate under 10%? My guess is yes.

If one looks past the discussion of economic news and listens to the other information, Ms. Romer is giving the public a look at the next major target the administration has in mind: Health care

“When you actually look at that budget going out in time, the thing that is going to bankrupt us is government expenditures on health care,” she said. 

Insurers of all kinds, take note and start to duck and cover.  The heat will be rising for you very shortly.

When the news came out that President Obama, essentially, fired GM CEO Rick Wagoner I was blown away – and HIGHLY worried that the lines between government and business had finally blurred too much. I strongly believe the government should not tell a company how it should function. If the company cannot function on its own, the company should cease to exist.

My level of concern jump yet again as I found out the Obama Administration refused the repayment of TARP loans from a number of small banks. Why? I think Stuart Varney has hit the nail on the head:

The government wants to control the banks, just as it now controls GM and Chrysler, and will surely control the health industry in the not-too-distant future. Keeping them TARP-stuffed is the key to control. And for this intensely political president, mere influence is not enough. The White House wants to tell ‘em what to do. Control. Direct. Command.

It is not for nothing that rage has been turned on those wicked financiers. The banks are at the core of the administration’s thrust: By managing the money, government can steer the whole economy even more firmly down the left fork in the road.

If the banks are forced to keep TARP cash — which was often forced on them in the first place — the Obama team can work its will on the financial system to unprecedented degree. That’s what’s happening right now.

Paranoid? Maybe. Until one sees even more indicators of what the administration has in mind. On “Face The Nation”, Treasury Secretary Tim Geithner said the following:

When, in the future — or I’ll just say, if, in the future, banks need exceptional assistance in order to get through this, then we’ll make sure that assistance comes with conditions, not just to protect the tax payer but to make sure this is the kind of restructuring necessary for them to emerge stronger. And where that requires a change of management of the board, we’ll do that.

While I can understand conditions on assistance, there are a large number of fiscally sound financial institutions forced to take TARP cash. Yes, Forced. If the company was forced to take cash from the government, this implies any company forced to take cash will also be forced to change management as the government sees fit. Something is not “conditional” when you have no options to begin with.

Why does the Administration want significant control of the financial markets? I my opinion, it is not due to the current recession, it is due to Europe and the G20.

G-20 leaders declared a crackdown on tax havens, tighter regulation of hedge funds and a new supervisory body to flag problems in the world financial system.

A sweeping G-20 communique appeared to bridge the gap between the United States and major European countries over how far to push changes on regulation to curb the market excesses that led to the current crisis.
Marco Annunziata, chief economist of the UniCredit Group in London, said the G-20 accord gives the U.S. “very little” while Europeans got most of what they wanted.

The agreement out of the G20, essentially, gives regulatory power over our economy and finical system to international interests – mainly France and Germany. This is huge as EU interests and priorities regarding economics are NOT the same as US interests.

If you thought the Bush administration was power hungry, and it was, you need to wake up and see what is going on now. The current administration is not looking out for U.S. interests, as it said it was going to under the “change” mantra; no, the administration is marching free enterprise and capitalism right into the hands of European controlled socialism.

Cooking and such

I am really starting to take great enjoyment in cooking. I am far – and I do me far – from being a good cook, but I think this is something I wish to explorer further. Mind you, I’m not saying that I want to make a career switch and devote my life to the art of food. I do feel; however, exploring what cooking can offer me is something I need to investigate.

On another note, there are a number of things I want to try making:

1. Mediterranean Lemon Chicken
2. Hummus (Garlic or Red Pepper)
3. Sweet Potato Oatmeal Bread
4. King Size Corn Mufffins

I also believe that a blog dedicated to my cooking efforts my be in order…. we’ll see.

Geithner’s Toxic Asset Plan

If you didn’t hear, the administration announced a Toxic Asset Plan to help remove the bad debt from the balance sheets of banks. How does the plan look? Well, to me, it seems the government is trying to take action but not really addressing the issue.

Two things really stick out to me from Geithner’s plan…

Geithner: My Plan for Bad Bank Assets

The American economy and much of the world now face extraordinary challenges, and confronting these challenges will continue to require extraordinary actions. No crisis like this has a simple or single cause, but as a nation we borrowed too much and let our financial system take on irresponsible levels of risk.

There actually is a simply cause – The Federal Reserve mismanaged interest rates for years and the Government initiated policies that weakened oversight and regulation on the industry.

Moving forward, we as a nation must work together to strike the right balance between our need to promote the public trust and using taxpayer money prudently to strengthen the financial system, while also ensuring the trust of those market participants who we need to do their part to get credit flowing to working families and businesses — large and small — across this nation.

…

We cannot solve this crisis without making it possible for investors to take risks. While this crisis was caused by banks taking too much risk, the danger now is that they will take too little.

This comment goes to show that the government isn’t addressing the true issue – the banks have no reason to lend to anyone now. The reason credit has locked up is due to the lack of credit worthy borrowers. The consumer has taken on too much debt and is now struggling to get out from under the avalanche.

While the removal of toxic assets will put a stop to massive losses by banks, I fear the government is going to force financial institutions to engage in needless lending which would put us back into the same situation. Essentially, it looks as if the government believes there is nothing fundamentally wrong with the financial system, which is not the case. Bad banks need to be eliminated, much like bad automakers need to go away.

The AIG Bonus Issue

As the AIG Bonus issue gains more attention, there seems to be a bigger back story than most would have expected and it seems that no one is immune to the fallout.

First, Timothy Geithner expresses outrage over the bonus payout:

I know there is considerable outrage in the House of Representatives, as there is throughout the country, about the bonuses awarded to the employees of AIG Financial Products division at a time when the company is reliant on significant taxpayer dollars.  The President shares that outrage, and so do I.

Then we hear that President Obama said he was stunned to hear about the AIG bonuses:

President Barack Obama has told Jay Leno he was stunned when he learned of the bonuses that bailed-out insurance giant AIG was paying its employees.

Obama told “The Tonight Show” host the payments raise moral end ethical problems — and the administration’s going to do everything it can to get them back.

But Obama added the bigger problem is the culture that allowed traders to claim them. He says that’s got to change if the economy is to recover.

But then we find out Geithner was the person who PUSHED for the AIG employees to keep their bonuses:

Treasury Secretary Timothy Geithner told CNN Thursday his department asked Sen. Chris Dodd to include a loophole in the stimulus bill that allowed bailed-out insurance giant American International Group to keep its bonuses. 

In an interview with CNN’s Ali Velshi, Geithner said the Treasury Department was particularly concerned the government would face lawsuits if bonus contracts were breached. 

Either Geithner is not telling his boss, the President, what is really going in the Treasury or he is lying about his outrage over the bonus payment (or both).

Folks, Geithner needs to go.  

He “forgot” to pay his taxes even after his employers told him of his liabilities.  He designed, with ex-Treasury Secretary Paulson, the original $700B bailout that was wasted, and now he is playing two face with the AIG bonuses. It is becoming more and more apparent that this man does not have the interest of the United States at heart.

Cooking this weekend

I am in a very… not creative… um… experimental food mood.  I think this weekend I will attempt to cook up some Vegetable Pakora and some Chicken Curry.

The recipes above are a few that I found while searching around, but I am open to suggestions.  If there is an Indian dish you love, and think I should give a try, please do leave me a comment and point me in the right direction.

How time has flown

Before I walking into a meeting room today, I was looking at a giant wipe board calendar that was broken out by the 12 months of the year.  This calendar highlighted all the events – major events – that my team was working on during the year.  

As I was reviewing the calendar I realized, wow… a quarter of the year has already passed by and it seems as if I am standing still.  What have I accomplished thus far?  Have I moved forward, or am I just running in place?  Am I making the most of my life or am I simply moving from day to day?

I have no real answers.  Yes, ideas, but no real answers.  

When I was a child, it seems as if the summers wold last forever.  I had no care in the world and always wished that I could fast forward the future, but now the feeling of carelessness was replaced by reality.  The looking toward the future has become just making it through the day, and it seems the gift of youth I once had was wasted as I rushed (pushed) myself toward adulthood.

I’m just amazed at how quickly time moves and how views change.

At this very moment I happen to be watching a new Discovery Channel program called “One Way Out” and I’, not sure if the host is a total nut job, highly intelligent or both.  I’ll tell you this, it’s quite entertaining to watch.  It’s almost part Jackass and part Myth Busters.

It’s not for the faint of heart though.  

Anyway, there a number of things that happened today that I have some thoughts about.  Let’s start with Illinois Politics

Rod Blagojevich 

The impeachment trial of Rod Blagojevich started today, and guess what… we wasn’t there!  He decided that the trial “wasn’t fair” and simply decided he wasn’t going to show up.  Instead he was all over talk shows this morning acting as if this was no big deal.

When pressed on comments he allegedly made about selling the open Illinois Senate seat he said “I can’t confirm or deny anything when I haven’t had the chance to hear all the tapes. Whatever the tapes are, they will speak for themselves, I was working to try to make the right decision for the people of Illinois.” 

Is saying “I’ve got this thing and it’s fucking golden, and I’m just not giving it up for fucking nothing. I’m not gonna do it.” really looking out for the people of Illinois.  Yes, anything can be taken out of context, but there is a lot more in the transcripts that point to him trying to profit from the open position. Eventually, one can no longer take it out of context and see it is clear he was attempting to profit for himself and his wife.

The arrogance this man shows is amazing.

Timothy Geithner

As expected, the Senate confirmed Timothy Geithner as treasury secretary.  Let’s face it, the man is a crook. He cheated on his taxes multiple times and he employed an illegal immigrant.  He didn’t pay his taxes until it was clear he was going to be nominated for the treasure secretary, which makes one wonder if he would have ever paid at all if this position never came along.

Again, I want to know where the outrage is – in the press, in the Democratic and Republican parties, and the public in general.  A man who could not pay his taxes (either he forgot or chose to) is now in charge of the Internal Revenue Service.

More and more layoffs

When looking at things I could see happening in 2009, I suggested that economists were being overly optimistic and that I believe unemployment could hit 10%. All of a sudden the experts are starting to wonder the same thing. Today alone major corporations in the United States announced 40,000 layoffs.  40,000 in one day.  

Last year the economy lost 2.6 million jobs, this year has the potential to match that number.  With the public worried about their jobs, or if they will be able to pay the bills tomorrow, why would big purchases on their mind?  Easy answer, they wouldn’t be.  Unless some massive tax credit is provided to people who buy a home, the real estate market won’t be picking up any time soon… nor will the automotive industry (though, I would never expect the government to offer large tax credits for stimulate the auto industry at this point).

I still believe things will get worse before they get better.

Well, off to finish my TheraFul… still trying to shake this flu/cold.