Official Corporate Takeover Pressure

In many instances, corporate proxies may make it easier for hostile takeovers to be made. It is not always a given that making it easier to foster corporate takeovers, is in the best interests of all stockholders.

The objectives of many of the takeover artists are often solely for quick, short-term profits. That may not be in the long term interest of the corporation or most of its shareholders.

Yet, much of the recent legislative pressure in Washington from the administration has been to accomplish this purpose.

This does little for corporate democracy. It helps reimburse party and lobbyist funding.

Tax Credits for Business Hiring

Experience shows that the idea of giving business tax credits for hiring does not generally work. Businesses would eventually hire anyway in most instances.

What is important and damaging to business, is recurring taxes, not the need for credits. Research has shown this time and again. But left-leaning politicos love to hand out tax credits under pressure, as they cannot abide permanent tax relief.

It’s apparently against their secular religion.

So they continually talk about temporary tax credits, to impress the public and potential voters. Moreover, if the public is unfamiliar with business, politicians get away with the ruse.

At least for a while; because tax credit policy simply does not work.

Political Business Men and Women?

Too many of our law makers in Washington and in state houses, are lawyers. It’s no small wonder; we have too many lawyers graduating college. They need something to do other than seek litigation briefs.

It helps explain why we have too little doctors, scientists and mathematicians. I guess, when you cannot cope with science or math, it’s far easier to become a lawyer. Years ago, you could become a lawyer without going to college. You took the bar exam after clerking in a law office.

I believe too many lawyers in government have become a major problem. We need representatives who actually represent the people. They ought to come from different job experiences. Furthermore, politicking should not be a permanent career.

I also strongly feel that we need small business men and women in Congress and in state houses. It would change the legislative outlook about taxes, business and everyday problems of the middle class as well as poor.

The Federal Reserve’s Conflict

The Federal Reserve has a conflict of interest in its very mandate. The new financial Dodd-Frank regulation law has tilted the effect of the Fed in many ways, giving the executive branch of government much more influence on the Fed.

Despite the logic for the Fed’s independence, Congress always has wanted to impose influence. It has to an extent. Since 1978 the Fed has had to enforce the Full Employment and Balanced Growth Act, known as Humphrey-Hawkins. That conflicts with the Fed’s stated currency/inflation activity.

The Humphrey-Hawkins Full Employment Act enforcement creates an inflating bias; certainly not one of dollar stability. So there is always a conflict of interest.

Remember, the Fed handles monetary policy. The president, through the Treasury Department, is in control of fiscal policy. It’s difficult for the Fed to control outlandish spending by the government.

Sarbanes-Oxley Obsolete

Sarbanes-Oxley was passed in 2002, after the Enron and WorldCom disasters. Like all legislation by Congress, written and executed as a reaction to a media-enhanced investor-debacle, the law of unintended consequences is an ultimate result. Negatives far outweigh any positives.

Sarbanes-Oxley has been a great profit center for accounting firms. It’s also a good talking and campaigning point for populist politicians, but an expensive headache for companies.

Lots of smaller corporations no longer seek public funds because it has become too expensive for them to be publicly owned. Audits are too expensive.

What is more, the legislation helps little in preventing fraud, the intended purpose. That does special havoc with small business which cannot afford the added, expensive bookkeeping.

Moreover, this keeps foreign corporations, even giants, out of the U.S. or has existing ones reconsider their American status.

If any corporate executive wants to commit fraud, Sarbanes-Oxley will not prevent collusion to do so. On the other hand, anyone with corporate experience (that leaves out most in Congress) knows that Sarbanes-Oxley makes running a business more like a steeplechase or handicap than it should be.

Proxy Voting Changes

Attempts had been underway for some time for changes in the way proxy votes are permitted and counted. Under the new Dodd-Frank Act some have been finally legislated.

Street name votes must now have consent of the share beneficiaries. There are now nonbinding shareholder votes on compensation-related issues. Governance changes and board of directors compensation committee changes were also enacted.

Like other added restrictions on business, they serve little purpose, other than a play to a voter block that feels the corporation’s primary care is not its product or service, jobs and profits that enable it to operate, but to seek secondary social goals, almost simultaneously.

Anyone with hands-on business experience knows it is impossible to focus on both at the same time and be profitable. Only community organizers and social scientists with no top-level business experience think that way.

This fine-tooth-comb meddling is actually unfair to most shareholders because many activist minority shareholders are not really interested in genuine company matters. Their primary goals are societal concerns that ought to be rectified by federal, state and local government, not private corporations.

For years, they have clamored for changes in corporate activity which the vast majority of shareholders would not want. Today, corporations are being nudged by government to actually submit much of the proposals into their proxies.

The President and Moods and Sentiments

I have in the past discussed how moods are relatively long-lasting emotions; sentiments are shorter-term. Correspondingly, they can affect how stock market cycles react and can precipitate booms and busts in industry.

Therefore, our Chief Cheerleader, the president, in the midst of a deep recession, should never make it a practice of singling out an industry, whether industrial, communications, banking, insurance or lender of any type, as scapegoats when he wants the economy to recover and produce jobs.

Protecting Trade Secrets

The best and cheapest way to protect your trade secrets is to keep them under lock and key the best you can. Be sure your employees, customers or clients are not able to get at data that should not be made public. Of course, this is never simple.

Also, it’s logical at the very onset, to use trade names and logos that are hard to duplicate. Example: A made-up name such as Kodak.

The best and cheapest way to protect your trademarks, aside from registering them, is to actively use them in commerce. The laws are friendly only to those who fully employ the names, marks or logos they want protected. Even registration is not an outright guarantee.

Stay out of courts if you possibly can, when you have disputes that concern trade secrets or trademarks. Those with the most money to litigate will win.

Unfortunately, patent and trademark litigation contests often are not proud examples of prevailing justice.

The Dollar Gold Link and Bretton Woods

From 1947 until 1967, when we had gold- dollar convertibility, unemployment averaged only 4.7%, with economic growth about 4% annually. Plus the fact inflation remained relatively low.

In 1971, during the Nixon Administration, the Bretton Woods agreement set up a new system, including the International Monetary Fund and the International Bank for Reconstruction and Development, part of the World Bank Group. The U.S. dollar became the world reserve currency for the member states.

However, slower growth has ensued from that point, and gold today appears to be the preferred reserve of many countries.

America seems to have flubbed the job.

The Dodd-Frank Risk Cure?

Risk was never overcome by regulation. The media can more fully explain this, if they tried to find facts out for themselves and report them.

Example: Fannie Mae and Freddie Mac were risky semi-government agencies who were instrumental players in our sub-prime crisis. There was no lack of regulation.

But that financial meltdown has resulted in even more regulation with the likes of Dodd-Frank.

The EPA and the Democratic Process

Congress has not been able to pass a Cap and Trade bill. The public realizes the proposed legislation is a device for powerful government taxation. The measure is more a means for imposing taxes on industry and consumers, than it is for environmental protection.

So what does the Obama Administration do, in its effort to help reduce emissions it claims the bill will reduce? Especially when global warming is not scientifically proven?

It imposes controls through unelected bureaucrats in the Environmental Protection Agency (EPA).

Only they can make CO2, which we exhale, and trees ingest, a poison.

Phony Job Creation

When you hear that jobs are being created always consider:

One: Are jobs make-work for government or are they permanent?

Two: Are the jobs full time or part time? And if so, for how long?

If the work is for government, are they unionized with special pension programs? If the answers are that they are overwhelmingly government-oriented, you know they may be phony and costly. Particularly when so much of the so-called Obama administration stimulus went to states which added government jobs.

Another important statistic: While economists may differ, spending for a government job is known to have an economic multiplier effect of 1.4 or 1.5, On the other hand, private jobs have an economic multiplier of close to 3.5.

So beware of job claims during a recession, especially when you get those politically-inspired varieties.

Extended Unemployment Checks

Unemployment benefits have an impact on unemployment statistics. Extending benefits tends to make the unemployment rolls greater because it’s generally a disincentive for seeking jobs.

Studies show that most unemployed, who are not desperate, put off looking for work until unemployment checks are ready to run out.

But the media operates with just selective reportage. They find a small percentage who truly need more benefits and make it appear that all the unemployed require to be on a dole forever, or else they starve.

With no remedy, other than an unemployment check.

Real Unemployment Numbers, Part 2

Average unemployment numbers are what we get, covering all age groups. That average can consist of different classes, each of which is affected differently. Classifications contain teens up to age 25. Or all adults 25 and older Or high school graduates, or college graduates; skilled and unskilled.

The adjusted unemployment rate now is closer to 17.5%, not the 10% reported by the media and the government. The youngest job-seekers are suffering the most from the current recession.

Real Unemployment Numbers, Part 2

Average unemployment numbers are what we get, covering all age groups. That average can consist of different classes, each of which is affected differently. Classifications contain teens up to age 25. Or all adults 25 and older Or high school graduates, or college graduates; skilled and unskilled.

The adjusted unemployment rate now is closer to 17.5%, not the 10% reported by the media and the government. The youngest job-seekers are suffering the most from the current recession.

Inaccurate Unemployment Figures

Raw government-announced unemployment figures can be misleading. They must be carefully interpreted. They never fully are in the media, often for politically-slanted purposes.

Examples: Unemployment numbers don’t tell you how long the unemployed have been out of work. Or how many are not working full days or have permanent jobs. Nor how many have given up looking for work. Those out of work a long time may not even be looking for employment, and are not being counted as unemployed,

All that results in a better than reported unemployment figure.

Moreover, the time of year reported is a factor. And weather conditions may have much to do with short-term implications of job statistics.

Management Ability

It is true that an executive must operate with the hand being dealt. If the business environment or the economy is poor, an excellent manager may do extremely well by just minimizing losses. But there are no real standards to go by.

Look at the management techniques used and they are all the same. The same acronyms to describe managerial approaches. Those that worked in the past may not be working now. The ones that did not work in the past may be working today.

A lot of luck is involved and lots of persistence. You do need an earnest game plan Also an eye on protective management technique that actively avoids serious problems. That, for example, keep away from damaging lawsuits, especially employee harassment and EEOC complaints. Management has to consciously stick to the employee manuals set up.

The CEO Role

Studies have looked at the effect of top management changes and have found they account for only about 10% of added profitability.

Often it is other circumstances that result in a company’s doing better or worse. The economy, business or general industrial conditions may have much to do with any company’s near-term fortune.

There are business cycles. Moreover, the bigger the company, the harder it is for a CEO to turn operations around on his or her own.

The CEO is certainly important, but never to the extent the public, or the media, may believe.

Speaking on Our Feet

The inability to speak on our feet has brought about a term I have called Telepromt-torical.

President Obama has much to do these days with the state of our business and financial climate. He appears to be vying with the status of those ancient Roman senators who stood around in togas making speeches. Interestingly, they did so without the use of teleprompters.

He, however, has changed things in this country, even the world. You might say, his speeches are very teleprompt-torical.

I would think that schools today ought to include courses on debating, in addition to their regular curricula. The ability to think on your feet without having something to read from in front of you, other than note outlines, would be a benefit to all.

And not just for those who hope to become president.

MBAs for Environmental Studies

By now. there is enough evidence to show that the entire scientific evidence behind global warning is suspect.

Environmental studies programs depend to a great extent on the premise of global warming. Cap and Trade legislation is actually a ruse to create taxation, based on dubious global warming science.

So why start off on a career with a new MBA degree in this specialty? It is either a marketing ruse to get a job that defies science or your own credibility as an MBA has become tainted by scientific doubt.

Just another marketing scam our vaunted institutions of higher learning have developed.

Government Regulation and Bubbles

Politicians are having a heyday on how they intend to stop future financial bubbles. They succeeded with enacting Dodd-Frank.

Bubbles are man-made, enforced by government policy and regulation. They breed on human psychological extremes. And they feed on panic.

The onus and guilt may be thrust on private parties for political purposes, but bubbles exist only if government agencies permit them to do so.

Actually, it’s far better that the powers-that-be in government sit on their hands than “do something” in the way of remedies. The long-term in a bubble event often takes care of problems better than short-term panaceas.

Apart from those called in to do the short-term patchwork remedies, If there has to be basic blame for recent bubbles in the U. S., it can be placed on the heads of the governors of the Federal Reserve. They are the guilty, who have made money too cheap. That is always the fuel for a bubble.

Bubbles can be dampened when the availability of currency is tightened. However, the opposite monetary policy has been the story in U. S. bubble experience.

America a Corporate State?

Liberals will fight you to the death, should you accuse them of any fascistic offense. Yet they are, nevertheless, guilty of corporate state politics, right here in America.

Their argument is that super financial regulation, such as Dodd-Frank, is the answer to stopping bubbles and financial risk. More regulation, they say, will reduce financial meltdowns. That same financial risk that past regulation failed to catch.

And if large companies “too big to fail” look ready to do so, the U. S. ought to be the employer of last resort, to bail them out. While government, in effect, operates them. In the past, the bankruptcy laws remedied the problem without political input.

Well, that is corporate statism, pure and simple. That was the road taken by the Obama administration with autos and banks and insurance in 2009, and it is now a permanent fixture.

There were alternatives.. Actions that would have been better solutions and less destructive to our long-term economy.

College Kids Are Getting Their Money’s Worth?

There is a disconnect somewhere. More kids go to college. More get into debt. More of their parents are going broke financing their education.

According to the National Assessment of Adult Literacy, the percentage of college graduates’ ability in literacy had declined from 40% to 31% in the past decade. About 20% of college seniors did not have the ability to estimate whether their car had enough fuel to get to a gas station.

But more kids and parents can show those fancy diplomas to friends and relatives. So I guess all is not lost after all.

Why Waste Fortunes on Useless Degrees?

Some people look down on vocational schools. A degree from a four-year college is considered first class. A vocational-school degree is not. That should be a prejudice we must overcome. Because maybe that is what many students would be better off at.

Those who have employable skills will earn top dollar at jobs that employers want, even in deep recessions. Others, with their fancy-school diplomas sit around depressed for the lack of opportunity, despite all their effort toward those impressive but impractical and useless degrees. It’s rough spending a fortune to get through college, only get a degree that does not enable you to find a viable job.

It is worse when that career puts you in extreme debt.

Earning Good Money Without College

You don't really need a four-year college degree to be successful. Vocational education does pay off better for many of those who have lost jobs or are seeking entry-level positions in trades.

Even lower-level electricians today make on average $48,000 a year. Plumbers make $47,000. That's much more than the average American earns. And those jobs may be more plentiful.

According to a Wall Street Journal 2010 survey, accountants and engineers thought that the schools played an important role in employer consideration but the numbers were not that overwhelming. For business and marketing majors, the survey appeared to show that the schools were not that important, especially when cost was considered.

That going-to-college myth is slowly shrinking with the Great Recession.

The College Teaching Mill

Consider the dismal teaching quality of colleges. Over 4,000 colleges and universities now enroll over 17 million students. College has become a huge growth industry. Unfortunately the industry has also changed and mutated negatively, with far too little oversight of quality.

Colleges appear to be primarily in the business of acquiring students, differing to a degree, only in their approach to marketing.

Some do so as research centers. They may boast professors with science awards and Nobel Prizes. These are very appealing marketing devices. Such esteemed faculty also attract grants and endowments, as well as students.

But even that’s a façade and not a teaching-type institution to attend.

Realistic College Planning

Are you or your kids really college material and worth the sacrifice of cost and effort?

Be realistic about yourself or any of your children going to college. It’s a major budget-busting factor that has been tossed about for years in a sea of misinformation. The facts about education, especially college, are about as corrupted as those that surround investing.

They also impact the family positive, even negative net worth, and deserve full family thought, discussion and proper planning. ( See the Earl J Weinreb NewsHole® comments.)

Futures Markets on Future Events

Some businesses have had employees create a futures market on a subject of importance to their company. They feel that certain points of view, though a gamble, can be prescient, if the gamblers or speculators have no inherent bias in their choices.

Future projections on business concerns always are difficult to estimate. If any can be predicted with more independent accuracy, they would be immensely practical.

But caution is needed. For such markets to have value, they must have lots of independent input. Sampling should be efficient and unbiased.

I find that is almost impractical in most business projections. However, futures markets may have their place in foretelling political outcomes and general marketing concepts.

Joseph Schumpeter on Capitalism

Those who know the least about capitalism rant the most about its negatives and never appreciate its overwhelming positives.. To those I would suggest a review of the life and work of Joseph Schumpeter, the Austrian-German-American economist. He died in 1950 and has been since overlooked in academic circles and the media.

His view of “creative destruction,” how the demise of established companies led to a growing economy has been the foundation of the American dream for so many.

Personal incomes have doubled every fifty or sixty years in America, when entrepreneurial zeal is permitted to operate.

Yet, left-leaning politicians will never guess there is any economic opportunity without government being the instrument of largess.

Labor Unions and Real Wages

In an ideal productive society, a worker gets what he or she produces. Labor has to be productive. If it is not, there is an eventual disconnect somewhere.

The perfect example is the downfall of the American automobile industry which priced itself out of business primarily because of its labor costs. You can talk style and product non-competitiveness, but the bottom line is this: Management was bulldozed into giving eventually catastrophic labor contracts, in order to avoid immediate catastrophic union walkouts.

The breakdown in schools can be attributed to the same cause. Here it is the avoidance of competition in the form of breaking the public-school-only monopoly that unionized teachers have. A choice of vouchers would make for better productivity of teachers and better schools.

Unfortunately, the labor unions and its wage conflict has grown into the American social and cultural contract, and has been so highly politicized by union campaign funding, it will be almost impossible to rectify in the foreseeable future.

Inept Colleges

Too many schools market themselves by appealing to the baser instincts of students. The idea is to fill the rosters by making it easier to attend. So many graduates are unable to find real, practical jobs. Or why we have so many with easy-to-get law degrees and few who are doctors and scientists.

Affirmative action is practiced, not just for conventional minorities. It is there for any group that is not equally represented on attendance roles.

The truth is, few undergraduate students have celebrity professors. They often are taught, instead, by graduate students.

In fact, Colleges and universities engage in "bait and switch;" confer what are actually deficient degrees, and engage in other practices that would bring legal sanctions if done in any other business.

Parents and taxpayers pay billions of dollars to colleges and universities. Schools make money whether students learn or not, whether students graduate or not, and whether they get good jobs after leaving school, or not.

The College Education Scam

College education has become a scam in many ways. College administrators and politicians should drop promotional hype. Higher college enrollment and government loan programs and subsidies may be good for the college marketers, but they don’t produce the training needed to fill real, paying jobs in industry.

Too many degrees, especially from four-year institutions, offer graduates little skills but a resume, when they go looking for a job in the real world.

Women Pay Levels

Women pay levels have been the subject of controversy for some time. There is no doubt they had been discriminated against in the past. The question is whether they still are, when anti-discrimination laws have been around for decades and penalties are severe.

True, women still tend to earn less. But there can be valid reasons. Because many women do leave jobs in mid-career for maternity reasons and that distorts statistical averages. Others prefer to spend more time with family.

Still, there are more variations in certain professions than others which makes this not the sole explanation for income variation. Hostile environment may often be possible. The discrepancy varies by profession.

Women’s needs may vary within those jobs, especially where measures of hostility may actually exist.

Defaulting on College-Acquired Debt

Defaulting on college-induced debt can be a dilemma. You will have to get a grip on the type of debt, whether federal or private, and its terms. I suggest you contact the National Student Loan Data System, at www.nslds.ed.gov.

There may be some forgiveness programs for government workers and teachers, along with AmeriCorp volunteers and similar programs.

As a precaution, avoid heavy student loans. Do not go much further into debt than you may already have.

Tuition, room and board charges that total $100,000 and more in many instances can be an enormous impediment for any student or for parents. For those with several children to put through school, it can be the major obstacle for a comfortable retirement.

College Grade Inflation

Inflated college marks are now the norm. At the College of the City of New York during World War II, students were admitted only if they had the highest grades in local schools.

If they were getting deferments because they were science and engineering majors, they had many of their classes marked on a “curve.” This was comparable to having to make the cut in PGA professional golf. The lowest 10% to 15% of each class flunked, no matter what mark they got. Classmates competed against each other

In the toughest college in the city, perhaps the U. S., open only to the top high school graduates, a student with one class "failure" immediately lost that army deferment. Compare that to the Ivy League standards of today!

If truth be told, students go to Ivy League schools because of the aura about them, and the contacts they afford. The vaunted Ivies are not tough once you are admitted. If anything, they are overrated.

Regaining Recession-Lost Jobs

It will take years for lost jobs to come back. In fact, many may never be available once more. Our only solution will be to produce new types.

Small business, which accounts for more than half of our work force, is a solution to the employment question. Unfortunately, most bureaucrats and influential politicians in Washington, are not attuned to their interests. The heavy lobbying and influence comes from big business and labor unions.

You can be sure: Ever-higher minimum wages, taxes and insurance costs are the poison that guarantee that small business will not be able to fulfill its conventional role of creating new jobs.

Unless Washington’s political elite relent..

The Definition of a Good Manager

Good managers as far up in rank as CEOs, are hard to evaluate. It’s not as easy as evaluating an athlete who wins or loses events, or has measurable statistics. I know that the sports media have experts who make lots of senseless noise, comparable to locker room or bar room chatter.

While business sales can be measured, as well as profit and loss, it’s not that simple to evaluate executives who may not be responsible for the bottom line after all.

I have always said a good executive may still lose money for his or her company. But less than a poor manager or executive would have lost under similar conditions. Thus more arcane yardsticks must be employed, depending on the type of business.

Moreover, what incentives do you give to get results? What is good pay? Or options? Do more and more money inducements really make a difference?

The definition of a good manager is difficult when the evaluation is equally hard to make. On-the-job experience may accomplish it, not text book explanations and suggestions.

Centralized and Decentralized Business Management Styles

Companies can be top-managed in two ways. The public is not generally conversant with the difference.

In short, there are two different types of CEOS for two different styles.

Very strongly, or centralized, where the CEO is in complete control of the company’s daily operations. Many executives prefer this approach. I ran a highly successful 74-office employee-contracting firm using this management principle. Those offices operated in a myriad of industries.

Or, loosely and decentralized, where more local control is allowed. Warren Buffett operates his different companies within varying industries on a decentralized basis. His individual companies perform without much strict daily direction.

I prefer centralized, hands-on oversight, which I believe is better from the operational standpoint. On the other hand, if your goals are primarily that of an investor, you never have the time, nor perhaps the ability or inclination, to cope with daily administrative duties.

Cap and Trade

Cap and Trade legislation appears to be at doomed in Congress but left-leaning politicians never give up trying. Those who still believe in global warming science as being unpolluted, are still its religionists.

Added to entrenched-religion environmentalists are practical leftists who realize that Cap and Trade is an instrument for enforcing control and taxation on the population without designating the effort for what it truly is.

The main problem is the economic damage that will be imposed, though the vast majority of Americans do not want Cap and Trade.

However, the government is enacting many of these actions without the approval of the electorate, by stealth. It’s weapon? The almost unrestricted use of Environmental Protection Agency dictats.

A Man-Made Recession

I have often commented in the past on our economic financial meltdown; I think it’s worthwhile repeating.

Too many folks are still getting misled by the slanted media and by politicians.

One lesson: Up and down economic cycles are normal, but excesses may have other causes.

Second: The current financial meltdown started as a direct result of a concerted government policy of making home mortgages available to folks who could not afford to have those mortgages.

Three: Government pressure, and threats of law suits from “do-gooders,” in addition to the opportunity for profit by banks, who collateralized the mortgage obligations (CDOs) that facilitated mortgage sales the world over.

Four: Government-licensed rating agencies gave these CDOs the AAA ratings that assured the global sale of the securities.

Therefore, a bubble grew until, like all bubbles, it burst.

To add to the bad psychology that accompanies any bust, the government came in with a series of disastrous man-made steps.

Furthermore, the decision to determine bank value on a daily fictitious basis.

Then, catastrophic unnecessary bailouts of banks, and buy-ins of auto companies when ordinary guarantees would do. The government takeover of AIG was unnecessary when an ordinary bankruptcy would do less damage.

In short: The government has seen to it that a slight economic downturn has become a Great Recession. With an unconscionable deficit to go with it.

The French GDP

GDP or Gross Domestic Product is a measure of a country’s economic output, the value of all its goods and services produced. It therefore represents the country’s standard of living.

The French GDP is falling, so they want to substitute their vacation time and other assumed “joie de vivre.” After all, it can be embarrassing when the French have to compare their left-oriented economy to those more attuned to capitalism.

So they have suggested an arbitrary adjustment that assumes their way of living is superior to others. They may take the month of August off for holidays. So they come up with an arbitrary value from under their chapeau.

But what about the lack of services during August? And those constant, paralyzing public union strikes?

Patents for Business Methods

Patents were originally intended for pure inventions. They contributed to the U.S. becoming the industrial leader of the world.

Now patents are being issued not only for actual products and things, but for general ideas and business solutions. Or even the way payments are made online.

Courts have been looking at cases in dispute, to see if clarification of patent law is necessary and whether interpretation of the law is to be more limited.

Facts About Global Trade

It was the Smoot-Hawley protectionist import duties that set off the world-wide trade protectionism whereby industry was stifled and the Great Depression became global. That mistake, along with Franklin Roosevelt’s high U. S. taxation policy, reckless government spending, and a mindless Keynesian philosophy.

It was a similar pump-priming stimulus theory that the Obama Administration is keen about today.

Remember: We are primarily an export country. Playing games with protectionism to save a relatively small number of jobs, compared to the whole jobs picture, can be deadly for our economy.

Pension Fund Allocations

The problems that persist with pension fund allocations, particularly those funded for public state employees, is that they are predicated on assumptions that securities will continue to earn about 8% a year.

These funds averaged as much in the more distant past, but they are now earning much less in recent years. Unfortunately, pension funds will be lucky to get 3% net or so in the future.

This under-funding for public state employees is running in the trillions and is bankrupting many state budgets.

Ode to School Funding

Don’t expect schools to provide an adequate underpinning of information, so students can comprehend economics and finance in the real world. In truth, the public cannot evaluate the bombardment of ads, nor the headlines that apply to finance and business topics.

That’s also why the retailers of America would be lost if cash registers didn’t automatically make change for everyday purchases.

Most younger clerks could not figure dollars and cents transactions as our parents and grandparents did before America started spending a fortune on schooling.

When Execs Act on Advice of Lawyers

A few years ago, the executives of the Bank of America had consented to a proposed judgment by the SEC to pay a fine of $33 million.

The judge on the U.S. District court, Jed S. Rakoff, of the Southern District of New York, however, held that bank executives had acted on the advice of their lawyers. Why then penalize the bank and its stockholders? Would you penalize the bank executives for taking legal advice in good faith? Why not penalize the lawyers for the advice?

Government and Job Creation

The government can employ people and achieve full employment by drafting every unemployed person. Particularly, high-cost, make-work jobs. Federal “stimulus” spending is promoted for its job creation. But that obviously does not “create” jobs.

Private industry jobs, on the other hand, are created in response to economic demand, incurred for a need. A businessman knows that expenses should be kept to a minimum, so jobs are genuine. Real job growth requires business optimism. With no tax and iffy economic fog. Training along with payroll expenses make human resources a long-term investment.

Government work also absorbs tax money, that could have been used for economically useful job growth. The government uses tax dollars as “stimulus” funds only as it sees fit.

The government can help create jobs by cutting taxes. That would make it easier to create business. They can help also by limiting restrictions on terminating employees. The latter would therefore more easily get hired by private industry.

Misguided Youth

If American youth were truly aware of the effects of the monetary inflation set for them and future generations, they would be shouting from the roof tops for the government to stop the economic mess.

Instead, most are still more concerned with the latest entertainment fads and entertainers. Or how much more it may cost most of them to get an ineffectual education, particularly should they go to college.

The ones demonstrating for lower college tuition have learned poor economics. Our youth have no idea of what budgetary deficits have done to them so far and certainly what they will do in the future.

Nasty Credit Card Companies?

A question for those in Washington who pick on credit card companies. Along with commentators in the media who fulminate over “outrageous” charges and fees.

Bad debts incurred by the companies generally run close to 10%. The companies in the business are losing money, so they are attempting to earn fees where they can operate. If they cannot get repaid by the deadbeats, they will receive it from the many customers who pay their bills on time.

If the business is so great, why aren’t so many more banks running to get into it?

Job Resume Factors

The right job resume is essential. So make a job application simple and current. Keep it up-to-date.

Dates are important, as is your formal education. In fact, the latter appears to count importantly on a resume.

Yet, much of what you learn in school is useless for a practical job. Therefore, be sure you are explicit about what have you done to make money for your past employers or how you have been able to help them save money.

Or if you feel you have talents as an organizer, describe what you have done and accomplished in this type of effort.

Beware When Hiring "Contractors"

As a follow-up to my previous blog on the hiring of contractors.

Remember: Contractors do not get unemployment checks.

Many newly hired employees want to escape employee payroll taxes just as much as employers do, and prefer being contractors. That is, until they are no longer working and are then seeking unemployment insurance. Then they complain they never were independent contractors but really employees.

They file for unemployment insurance and the employer has the difficult job proving the employer/employee relationship.

Killing Birds to Save the Environment

The Obama administration has plans to have wind power supply 20% of our energy by 2020. At the expense of the bird population.

The project calls for 186,000 50-story wind turbines to be built in California, Nevada, Arizona, Utah, Colorado and New Mexico, along with 19000 high-voltage transmission lines.

With the probable killing of tremendous numbers of birds as a result, and the outlay of huge taxpayer subsidies, all this could be accomplished, according to the Nature Conservancy, by a minimal number of atomic energy facilities. And at much lower ongoing cost.

Without the eyesores that will beset the Southwest of the U.S. if the Obama Administration planning comes to fruition.

Ruining the Environment: With Solar Panels

Covering the desert landscape with solar panels is one way to make the environment “green.” Though you may profess love for raw nature.

Which does not work in any event.. When solar panels get covered with desert dust and dirt, they do not accomplish their goal. They have to be washed down with water every month. Yet, precious water is not available in the desert.

The Wildlife Conservancy and other clear-minded environmentalists are against solar panels in the desert. That, in addition to the fact the process still has to be subsidized by taxpayers.

Corporations Treated As Individuals

The status of the corporation as a legal person has been considered valid, going back to Chief Justice John Marshall in 1819.

Equal protection laws always applied to corporations in the past. There are questions which occasionally arise. In fact, they occurred recently during the nomination and approval of Supreme Court Justice Sotomayor.

In a hearing prior to her approval, Justice Sotomayor remarked about corporations not being people. However the Supreme Court has always held that corporations held broad First Amendment rights, as do individuals.

Should her stance become the view of future Supreme Court rulings, the entire basic commercial structure of this country could be overturned.

Are You Really an Independent Contractor?

Whether or not you’re an employee or a contractor is a long running problem for small business individuals. I have written extensively on the subject,

The subject has become trickier, as the courts are vague and tort lawyers have been given more leeway by judges and juries who know ever-less about business.

The rule of thumb for business is this: Basically, if you control how a worker performs, he or she is an employee, not a contractor. Tell the hired person how and when to report to work and you have an employee, not a contractor. Also, when you provide tools for work, you have an employee.

Tricky vagueness comes about when a question arises how important the job is to an employer’s business. You can be a genuine contractor by all conventional definitions and still be considered by some courts an employee of a business. Sharp lawyers come in to help make a complaint against the boss and trouble starts.

Government Bungling of Student Loans

The Obama Administration is telling us how ObamaCare can please the health consumer while cutting health insurance costs.

Here is the perfect example why this can never work as advertised.

The government has taken over the student loan business. And it is costly. Private lenders are being forced out of business. And what’s more, students are not happy with the government efforts.

After July1, 2010, private lenders no longer were able to make government guaranteed student loans. The government now had 20% of the market and is ready for a complete takeover.

Taxpayers will put up $100 Billion as a start.

The problem here is that private lenders did a better job of evaluating risk and collecting bad debt than the government. Any estimates of “savings” by the government is a fantasy. Government figures, for example, never have those the private lenders include, such as two-year college programs with much higher default rates. What is more, the government has a poor service record among student borrowers.

A portent of what can happen to our health system.

College Dieting Ahead

Increasing transparency is hitting colleges at the same they’re getting overwhelmed financially. It's diet time.

Universities saw their endowments take a financial bath when the stock market did and many got stuck with illiquid, unconventional investments. State governments have raised tuition at public schools, but state educational budgets have since declined.

Competition from for-profit universities, with curricula more oriented to job opportunities, has been increasing. Furthermore, the public has noted the tendency for college administrative bloat, Previous college administrations were able to get away with extravagance. They got by and prospered with expansive programs of dubious merit.

It does seem college administrators will have to expand their budget dieting regime further.

Court Change Of Venue

Few judges approve defense lawyer requests for change of venue. That’s where a trial location is changed in order to prevent possible local prejudice against a defendant. Most judges do not like to offer this request.

Yet, it’s important for cases in the public eye that a defendant be tried where jurors have not been bombarded with information about the case. And where defendants may be fairly judged on the merits of the case’s arguments.

Particularly, where information comes from populist and perhaps ignorant-of-the-facts media, that may already have prejudged that case.

Basic distrust exists against defendants who happen to be in finance or business. Most jurors, and I may add, judges, harbor innate prejudice against such individuals.

Many jurors simply don’t understand finance or business. They have been influenced by years of populist thought. A change of venue does not help change the harm done by such ignorance, but the change of venue principle is, at least, a step in correcting the system.

The Coming College Bubble

Presidents and politicians have promised for years to provide college for everyone and have measured success by the percentage of students enrolled.

But it's becoming clear that college doesn't make sense for everyone. Some students simply lack the necessary competence, including the ability to carry on fluent conversation. Nor do they have the basic math.

Many others would prefer non-college careers in industry. And are considering whether the expensive conventional college model is worth the heavy investment.

A century ago, only about 2 percent of American adults graduated from college; college education expanded when the G.I. Bill financed veterans after World War II. College attendance expanded further postwar and Government student loans have enabled colleges to grow even faster over the last three decades.

This growth has been great for the schools but the product has simultaneously suffered. America leads the world in mass education, not better education.

Unfortunately, a bubble is ahead and the result will not be pretty to observe.