The Dollar as an International Reserve Currency

                       

I often repeat: The potential loss of the dollar as a reserve international currency is now underway. The ability to protect U.S. global interests in the future will be diminished in this process.

                       

Do not treat unlimited government spending lightly. The repercussions can be extremely serious in matters of our economic and national security.

                       

The debt ceiling question is not important. Spending below that ceiling resolves the problem.

                       

A budget deficit that cannot be overcome without massive

taxation is guaranteed to stifle economic growth. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Importance of having an International Reserve Currency

                     

The potential loss of the dollar as a reserve international currency is now evident. The ability to protect U.S. global interests in the future will be diminished in such loss.  

                                           

Do not treat unlimited government spending lightly. The repercussions can be extremely serious in matters of our economic and national security.

                       

Think of what is happening with Greece and the European Union. The debt ceiling question is not important. However, spending below that ceiling can resolve the problem.

                       

A budget deficit that cannot be overcome without massive taxation guaranteed to stifle economic growth,  is the major difficulty. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

A Lesson From Franklin D. Roosevelt Economics

                      

Avid studies have been done by Federal Reserve officials of the actions of Franklin D, Roosevelt during the latter’s tenure in office during the Great Depression.

                       

Roosevelt made many errors, including raising taxes, and enormous spending after signs of economic recovery became apparent later on. In fact, he never got us out of the depression. Our then war effort did.

                       

Yet, the Fed is following a similar easy- money route that is not truly working.

                       

Can it be that, Roosevelt’s administration, as is today’s, was dedicated to class warfare and “soaking the rich”? (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Government Business Inefficiency

                  

Whenever the government proposes a function that is now done by private industry, the taxpayer will be contributing the necessary capital and operating funds, and will be taking all the risks usually undertaken  by the stockholders of private industry. As well as responsibility for the losses, which are bound to happen under government operation.

Think Post Office as an example.

                   

So be careful of any government attempt to reduce costs by competing with private enterprise. (See the Earl J.

Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Poor, but Well-Paid Teachers

                              

The National Assessment of Educational Progress has been called the Nation’s Report Card. It reported that only 23% of fourth-graders, 30% of eighth-graders, and 21% of 12th-graders were” proficient” or “advanced” on their national geography exam, given a few years back.

                   

I saw one of the simple questions posted in the Wall Street Journal. The newspaper reported that only 33% of eighth-graders got it right.

                   

With a student body such as this in the U.S. we certainly do not get our money’s worth with education.Yet, I do notice teachers’ unionized pay and benefits are highest ever. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Government Competition For Funds

   

Government too often gets in the way of business seeking funds.

       

Government spending displaces funds available for the private sector, particularly as interest rates rise. When that occurs, firms seeking funds are certainly less likely to get them. Yet, business are the entities which mainly create worthwhile jobs. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Chronic European Unemployment

            

Much of Europe is on the edge of bankruptcy amidst its permanent 10%-Plus unemployment. And its experience with younger workers, who do not get counted as unemployed because they give up seeking work early on, and are, in fact, permanently on the dole.

           

If they excel at something, it’s in their demand for funds from their neighbors’ taxes. Those neighbors who work.

           

This is the society many of our politicians fail to point to, when they sell us on government-supervised ObamaCare and other services the Europeans get so “cheaply.” (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Our Investing Habits

                      

No matter what we may learn in school or from the media, we stick to what we believe in our hearts. Even when we learn facts which may tell us that our past feelings are incorrect. And what our education or the media may have failed to properly inform us.

                               

All because of poor ingrown habits. Influenced by our political persuasion or prejudices or ignorance. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

The Media’s Market Principles

                         

Few general media reporters, columnists and editors have free market views, nor a background on financial subjects.

                       

In addition to what generalities journalists are ever taught, they receive a modicum of economic and financial training in school.

                       

Not theory from economists such as Friedrich Hayek, Milton Friedman, Thomas Sowell, Walter E. Williams, among others.

Thus you get left-leaning slants in many financial articles. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Trusting Government “Experts”?

                     

Americans should always think seriously about politicians who tell them government “experts” know all about spending and deficit control.

                       

Any politician or bureaucrat with a short-term horizon is never reliable on this score. Especially a politician unfriendly to, or unfamiliar with the true understanding of capitalism.

                       

Our huge deficit will eventually spell enormous inflation. Or a loss of currency value. And the certain loss of the eminence of America, as an economic and a political and military entity. (See the Earl J. WeinrNewsHole® comments and @BusinessNewshole at Twitter.)

Government Inefficiency

Everything the government has done, including its health care under Medicaid, have been inefficient with equally poor service, comparable to that of the Post Office.

                       

Government never fosters competition. It can cut out competition when it is permitted to write rules to have taxpayer money undercut the pricing of products or services of potential private producers.

                       

The Post Office will not give up its first class mail privilege. It knows it cannot compete if it has competition. Other forms of non-first class package shipping are handled by private shippers efficiently and at low cost. While private carriers would love to carry first class mail, the Post Office continues to maintain its monopoly.

                                           

The Post Office says it provides service to areas no private carrier will want to service. Not true, as evidenced by cutbacks the Post Office constantly imposes. And destinations to which private carriers now go.

                       

ObamaCare claims to provide everything private medicine can do better and cheaply but government has never allowed it. Such as interstate competition and tort reform and fraud correction, (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Americans are Ignorant of the Constitution

                       

I often write about our inefficient schools and how they prove to be a waste of much of our educational funds. They appear to do more for the welfare of the teachers than they do the kids being taught.

                       

As an example, I refer to Prof. Walter E. Williams, in one of his columns. Professor Williams, the now retired head of the Economics Dept. of George Mason University, still actively writes and comments about his specialty.

According to one survey, Dr. Williams says that only 28% of students can identify the Constitution as the supreme law of the land.

                       

And that fewer than 25% of students knew that George Washington was the first president of the United States.

                                           

And that only 26% of students knew that the first ten amendments to the Constitution are called the Bill of Rights.

                       

Years ago, kids did better, when they sat, 30 and 40 to a class, and in one-room school houses. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Necessary Malpractice Courts

                       

We have special courts for bankruptcies where judges handle creditor and debtor claims, tax liens, workers compensation, and so on.

                       

One complication that requires change, and proves costly, has to do with health malpractice cost. The problem is primarily due to the huge amounts of lawsuits against providers. And fraud that permeates the system.

                       

The result: The high outlays due to defensive medicine and doctor malpractice insurance premiums. ObamaCare does nothing to stop this menace.                   

                       

The practical solution: Arbitration courts made up of judges, trained in science and medicine. That would eliminate awards because of “junk science.”

                       

The courts could eliminate attorney’s cuts of the award proceeds and put a cap on outsized sums that ordinarily come from ignorant jurists and jurors. While seeing that patients are compensated for actual malpractice. The courts would be financed from doctor insurance premiums. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Political Independence of World Central Banks?

                      

Central banks are supposed to be completely independent. The European Central Bank or ECB took this position until recent years. The bank no longer is an independent vehicle.

                                           

In Great Britain, the Bank of England is a centuries older counterpart. The BOE, too, has always been entrusted with being an independent, non-political, overseer of the British pound. But the BOE now is also in the management game.

                       

Americans are no better off. The Federal Reserve slowly but surely lost its independence as well, as I have commented over recent years. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)