The Media’s Too-Slanted Market Ideas

        

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.)

Government Experts?

             

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, political and military entity. (See the Earl J. WeinrNewsHole® comments and @BusinessNewshole at Twitter.)

Inefficiency of the Government

             

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.)

Ignorance of our Constitution

               

Inefficient schools often 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,  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.)

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.)

World Central Bank Independence

        

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.)

College Degree Facts

             

College-attending questions persist, whether many students ought to be attending.

                     

I suggest reading "Going Broke by Degree: Why College Costs Too Much," by Richard Vedder and "Faculty Lounges and Other Reasons. Also Why You Won't Get the College Education You Paid For." by Naomi Schafer Riley.

                                        

In the Vedder book, for instance, you learn that two out of five students entering four-year study programs don't achieve a bachelor's degree after the sixth year. And that colleges accept these students because of the money they bring, usually government-guaranteed loans.

                     

Comments are quite instructive; you will learn why it appears so many of our Ivy-League graduates appear to be far dumber than ordinary plain-vanilla grads of the not- so-distant past.

                     

Another example of college being useless: Vedder states there are 80,000 bartenders in the U. S. with bachelor's degrees, and 17% of baggage porters and bellhops have college degrees, along with 15% of taxi/ limo drivers.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Questionable Government Outlays

      

There is a major difference between a dollar “invested” by government and a dollar invested by private industry.

                     

Too many politicians believe that it’s better if government makes the decision to spend. Or as they often say, “invest,” as opposed to private enterprise doing the function.

                                    

The government allocation is made by a political decision. That is often subject to pressures which have nothing to do with supply and demand. Rationing and corruption are bound to follow.

The other, privately imposed decision is, however, more likely to conform to what the public wants.

                     

Moreover, private industry investment has a multiplier effect, while government spending usually does not.

Government jobs thus have no leverage impact on the economy. Their purpose often has political, social and environmental intentions. Governments do not innovate and create new companies and multiples of jobs. Nor do they enervate the needed psychology of a booming economy. Psychological effect is most important. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

The Real Unemployment Number

             

We get unemployment reports that have little to do with true unemployment. It’s  another case of the reporting chicanery that the executives of a private enterprise would be arrested for.

                     

Right now the unemployment rate is supposedly a bit less than 5%. The media tells us so, and they are out to report on all they can find, or so they say.

                     

But if you look even deeper in the official report’s U-6 unemployment rate, which includes folks who are underemployed and seeking full-time jobs that they can't find, or have given up looking, that rate is much higher.

I suggest viewers look up the Bureau of Labor Statistics site at bls.gov for details on the different facets of unemployment the media forgets about. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

One-Sided Political Bargains

             

Two political sides attempt to negotiate a budget deficit. The question is to cut spending and size of the budget.

                     

When one side says it will severely cut spending a few years in the future but in the meantime takes current funds from taxes or keeps on spending, you just know that one of the two bargainers has gotten ripped off.

                     

No politician has ever followed through on promises made years earlier to cut budgets.

                     

So all negotiated deals of this kind have always been decided in favor of the big government spenders and taxers.(See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Polls -- Often Contrived

                 

Before you believe a political, business or scientific poll, ask yourself: Who pays for, or sponsors it? That can affect the results.

                     

Samples can be selected to give different results. Questions can be posed to produce preferred answers. Demographics can be altered to assure outcomes. And of course, interpretations can be subjective. Sponsorship can also influence the results of research. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)

Pension Fantasies

             

One reason why most state budgets are out of control is attributed to union-contracted, public employees pensions.

                     

Unfortunately, the unions continue to feel optimistic about the ability of their pensions to accommodate their coming obligations.. They simply fudge, by assuming fantasy earnings  on their investments.

                     

Unions find it easy to be optimistic about the future return on investments, far much higher than what most market observers consider possible, in the light of our budget deficits and their effects on investment markets. And prospective future inflation.  (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.

Inept Regulators

       

I often tell of  poor federal regulators, about their actions and how they do everything but regulate what they set out to do.

                     

I have taken particular aim at the 2010 Dodd-Frank Act with its over 250 provisions, and its countless, unforeseen negative effects.

                     

Such as forcing the banks “too big to fail” to keep adding to capital. This makes them less profitable, when they must be able to attract necessary capital for a thriving economy.

                     

Moreover, it’s foolish to constantly augment capital cushions that can be wiped out overnight whenever you mark-to-market the bank’s assets in poor markets. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)