Tuesday, March 20, 2018

Liberals Verses Limited Resources

If everyone in the world was enabled to live as we do in the advanced world, there would be one problem. Not enough resources to go around.

On the other side, have you noticed that with Liberals, there is a solution to any problem that faces mankind?

We often point to the bottle with a banana inside and a few fruit flies with a cork in it. Lets just take a city like Los Angeles. How many days would it take to evacuate the city if everyone was ordered to leave? Answer, about 8 to 10 days if fuel trucks could continue deliveries. Or how many days could you survive in Los Angeles if it was not being supplied with food? Maybe 20 to 30 days. How far will a tank of gas take you if the roads are jammed with stalled cars? How many people might all of a sudden want to shop at your home for food to eat?

We don’t think about things like this. But it could happen from several different corridors. A massive bank failure could paralyze food deliveries nationwide. Why would a truck driver, drive a load of food from NY to LA, if he had no way to be paid? A massive power outage could limit communications for several years. There is only one company in the US making power transformers and I am told it would take 20 years to replace them all. One good solar flare and we are back in the dark ages again.

We have reached certain limits of supply, that demand things continue in a normal fashion, for our standard of living to continue uninterrupted without glitches. The average liberal has no idea of what logistics is all about. Unlimited Government funding, ready access to fuel, food, water, and housing are assumed as a given, for any area. But what if they aren’t? Reality will set the tone. Three fourths of the world cannot afford political philosophies like Liberalism in their daily life, dreams don’t pay the bills.

We as a nation need to comprehend that our consumption of resources is so intense, that there is no way we can offer this life style to the rest of the world. The reason being, our standard of living must drop to accommodate them.

Liberals don’t realize is that most problems without any help, work themselves out very successfully given time. You still have the flask; the banana is gone and fruit flies are all dead. Funny how global warming was the perceived problem when in reality it has always been overpopulation.

Our national debt just hit 21 trillion dollars. Has anyone bothered to ask, who the government borrowed the money from? The answer is they borrowed it from banks and retirement funds. They borrowed it from people who saved money. If you are worried, talk to a Liberal to calm your nerves. Everything is under control. That last straw to break the camels back is probably years away. Probably while you are retired enjoying the good life.

The Liberals are going to give this country away, and I haven’t figured out who they are going to give it to yet. But I do know, if you if you are approaching retirement, a decent shopping cart to store your belongings in is highly desirable; now might be a good time to start looking for one.

Tuesday, March 06, 2018

Economics a Flawed “Science”

Trump just issued import quotas on Steel and Aluminum. And then you hear the press talk about trade wars and I am mentally reviewing my 3 semesters of advanced economics. I kind of nod my head but then I remember back to the birth of this country, up to World war I and reflect that tariffs are what funded the Federal Government.

I’ve looked at several economic models and the theory behind them and often marveled at what is holding these bubbles up in place. You throw up you hands and throw in the towel, what makes sense shouldn’t and what shouldn’t violate the models.

Somebody once said that Astrology was made a science so that they could also include economics as a science. If you think about it, economic theory is almost 99% an explanation of what went wrong and why during financial and economic collapses. It in no way explains where we are right now.

A trade war has economic implications that in most cases is undesired. At the same time, a country’s inability to produce steel to support a war could lead to it being conquered by a country with a large steel base. Our country has literally trashed steel production as a part of GDP. Remember Bethlehem Steel or US Steel? They built the ships that won World War II.

Any way we look at all of these economic revelations, is the assumption that tariffs will ruin trade. We have been turning a blind eye to the blatant trade violations of the rest of the world. Right now, I wouldn’t be surprised to learn that probably the USA is the largest consumer of Chinese dry wall in the world and the trouble is, it isn’t dry wall that we are buying, but prescription drugs stuffed full of calcium sulfate dehydrate (gypsum). You buy a Fram oil filter and the name is miss spelled or the directions make absolutely no sense.

We hear that Europe will ban blue jeans and Jim Beam Kentucky bourbon. Why don’t we just set 1000 BMW’s and 1000 US Cars in a group and say you can import 1 to 1. And of course, you cannot forget the VAT tax. Net result, our cars and theirs will not sell.

The net thing we need to realize is that over the long haul of history, economic theory works. The trouble is over the short term is that it is abused to create a desired outcome that can have very bad consequences in the future. It has been glossed over for the last 30 years.

The science of Economics is not exact. It can only judge the past. It’s a mistake to try to use it to portend the future.

Let’s back off and give President Trump his earned 4 years to do his magic –economic theory be damned.

Monday, March 05, 2018

Gun Ownership

You want to buy a gun. Well by god, you had better fill out all of the required paper work and go through a background check. And then you get the gun of your choice. Everyone upon turning legal age, has the right to purchase a weapon if they have not yet committed a crime.

Of course, if your dad bought a gun or two, the kids don’t need to register to get their hands on the weapon if they want to use it.

If Grandpa dies with several nice weapons, grandma could sell them to a gun dealer at about 20 cents on the dollar or go out and find friends of her husband that would want to own them at a reasonable price. The unrealized condition here is that this gun is worth far more money to any gun purchaser because it is untraceable at this point.

The real problem I see is a rifle that can shoot more than 6 rounds. If you are stupid enough to unleash 20 rounds at neighbors during civil unrest, guess what they will do? They will burn your house down with you in it. Shotguns tend to more of a deterrent to violence, for the main reason, you don’t have to be a good shot, you’ll rarely discharge it.

I wonder how many of the gun records show people over the age of 100 still owning guns? Kind of makes you wonder what happens to those guns after the person dies. It looks like the kids inherit the weapons. Sadly, there is nothing the state can do to control the passage of guns to next of kin at death.

I would be for banning hand guns. A couple of drinks and you could end up in jail for life. Same for Assault rifles. Our youth tends to learn this the hard way. But shotguns and regular rifles for hunting game with up to a six-load magazine capacity seem acceptable for just about anyone I can think of.

Two things we need to look at. Why do we need semi-automatic rifles? Animals do not shoot back. And second, if you missed it with the firsts shot, does that mean the target may shoot back? If the answer is yes, then you can pretty well determine that the hunter and the hunted were both human. That’s why some shooters need the better rifle and more ammunition. More ammunition takes into account that they are a piss poor shot. The big lesson overlooked here, this shooter is someone who wants enough ammunition that they can kill you after you run out of ammunition. Not sure how you weed this person out of society.

The sad thing to realized is that there is no real effective legislative control of the gun user.

I do think that there should be a move to eliminate military ammunition that can be used in rifles and get rid of clip loading rifles. None of us that buys a gun to protect our family wants a round that will go through two homes before it stops.

What we need to define is Military and Civilian weapons, they are not one and the same. And of course, I have always defined our right to bear arms as those that were in effect in 1789. Ever try to hold up a store with a flint lock pistol?

Wednesday, February 21, 2018

DisUnity in the U.S.

The DACA’s in this country want legal status, and neither the Republicans or the Democrats can come to an agreement. When the Democrats had both houses, Obama failed to address the issue. The same is true with the Republicans in power.

Neither side wants the party in power to get credit for anything. It is not a matter of whether it is good for the country. The minority party wants the party in power to fail in their platform promises to the voters. It’s all about votes.

On TV, put two opposing views on camera at the same time, its like dropping a cat and a dog into a potato sack, the results are predictable.

The Russians have been accused of messing around with our elections, and it is almost laughable. They were not interested in who won the election, they just wanted to create more disharmony with our institutions and the voters. That is pretty light weight stuff, considering what Hollywood and CNN are doing. When everyone was so positive that the Russian had interfered with the election I was mystified. What were they doing? Now we know, real stupid stuff that most people didn’t give a damn about.

We have half of the population mixing illegal immigrants with legal and considering them one group that want, open borders. The other group wants to get rid of the illegal ones but they are considered racists for their beliefs. The fact that some countries are considered “Shit Holes,” strikes a chord of “how dare anyone be politically incorrect?” Building a wall seems a tad bit logical in addressing the problem

The same mess with gun control, only this group isn’t split along the same lines as the immigrant problem. The false assumption is that government can by passing laws, control the problem. Criminals do not buy their guns at gun stores. They look for an NRA sticker on your pick up or something similar and visit your home while you are at work. Passing laws against legally buying a gun might stop some people, from a purchase, but seldom discourage a person who wanted one. The real problem with guns that is never mentioned is alcohol. Mix the two and you could end up in jail forever for doing something extremely stupid. Revenge is satisfying for a fleeting moment, but once the finality of your actions are realized, it is too late to do anything to change it back.

In this country some people expect government to protect every aspect of their life and others in a like manner, want government to leave them alone. Harmony is balance of the two. IMHO the Democrats and Obama went too far, and now they are more than sore losers, they are sore haters. And surprisingly the news media went with them. Now we have an abstract label for it called the “Deep State.” Also, another abstract label is “the far left” which is inclusive of our educational institutions. And then there is just very general vulgar name calling of our President. A complete lack of respect for the office.

It’s a sad time for our country, if you cannot show respect, you deserve none yourself. Respect for other people’s beliefs, dreams and Ideal as well as respect for our leaders is expected. It’s the fiber that holds this nation together.

The lecture is over, it looks as if the economy is improving. We are moving out of The Great Depression II (I hope).

Saturday, February 17, 2018

Our sick baby dog survives with help from my wife

Not much on Economics and death and destruction for the week. Hopefully our success in helping our small dog "Lucky" survive may entertain and possibly help save someone else’s pet.

We got a small sheltie dog in September and he was doing OK for a few weeks. We were feeding him canned dog food and he loved it. And then the pup stopped eating. When we got him, he was almost 2 pounds at 8 weeks. All of a sudden, he stopped eating and had diarrhea and started going downhill. We would feed him a bunch of ham and he would throw it up two hours later. We gave him back to the breeder for a week and he could do nothing with the mother in the cage. We took him back and he kept losing more weight. He got down to 1 lb 4 oz and we took him in to the vet for an IV and he perked up a bit. The next day he was staggering so we had the vet give him a subcutaneous injection under the skin and that kind of picked him up a bit. My wife and I were going nuts watching the dog die. I went down and bought some Gerber’s baby food and if I remember, it was puree chicken and a can of sweet potatoes. We mixed it together with goat’s milk and the dog wouldn’t touch it. My wife decided to force feed the dog with a small syringe forcing his mouth open. We gave the little devil about 9 mls every 4 hours round the clock. After 4 days, he started eating the gruel we were forcing him to eat.

Needless to say, he was a Gerber baby for the next three months, about the fourth month we got him to start eating kibbles. He is six pounds now. He can chew the shoe laces off a pair of sneakers in two hours.

I kind of just threw this out there, my root canal article from several years ago, still has people adding their comments to it and maybe this may help someone else in the same situation, with a pet that needs help. This may be the info they need.

Lucky says "ARF" "ARF"

Monday, January 15, 2018

The Hyperbolic Moral Indignation of the Democrats Towards President Trump

I cannot understand the fiery rage of Democrats over the Trump election. I had no rage over Obama being elected. I didn’t like what he did, but I didn’t stand on a street corner denouncing him with every Anglo-Saxon curse word in the books, for a whole year.

Trump’s rescinding of previous Presidential directives has given new life to areas of our economy that were over regulated by the EPA. Southern ranchers stood up to the EPA for new grazing charges for range land that they had used for over a 100 years. The judge just recently threw the charges out that the bureaucrats at the EPA tried to enforce. Most people don’t understand that most of our laws are created by some bureaucrat working in an agency. Whether it is just or unjust has to be determined by a court of law. As we all know, that can take a lot of time and money. This person in that office, has all of the resources at their command to enforce the laws it created.

Trump is not really a politician. But that is a good thing. BS is not something that you want to push with him. The country is starting to move in a positive direction. Most of the media will belittle that fact and magnify Trumps latest impropriety. Many of the TV channels devoted to the Democrats have been magnifying what they perceive as Trumps ineptitude.

I kind of get the feeling that the Democrats don’t believe the election is over yet. By hook or by crook, they want a Democrat in the White House. Trump has not violated any laws and is being called names that are so school-yard-ish, that they are laughable. The Republicans won the Presidency, and are being punished for winning. The Democrats in both houses oppose any legislation that was part of the Republican platform for election. The move by Democrats to impeach Trump for winning the election smacks of treason.

Many people in the US today have a very absurd interpretation of what Democracy is. “I can do what I want and other people be damned,” or “I can protest until I get my way.” It just doesn’t work that way. Democracy is like a woven cloth or a team of horses with a shared purpose.

The basics of compromise that kept the country running efficiently are gone. 20 trillion in debt, the Pied Piper could present his bill at any time and “we the people,” cannot pay it. I think this is why many Congressmen are quitting, they see the handwriting on the wall. The shear frustration of the stubbornness in Congress; “my way or the highway,” or the phone call threats on their families.

Trump’s has informed the Democrats that the Socialism orgy is over and I’m sure they are not happy. The Democrat's platform appears to be for big business, big money and Socialism for the masses. Trump on the other hand, is for the guy on the street and jobs. Somewhere, Somehow, the two parties switched political platforms. The press has called President Trump every name in the book except one; “A filthy rich Democrat with a knock out wife.” IMHO he is one—his only flaw, he lacks the corruption baggage. I believe he wants to go down in history as a pragmatist that solved quite a few problems. Let’s see if he will be given the chance.

Wednesday, December 27, 2017

Fewer Presidential Executive Directives For the New Year

Most people think that the laws of this country are passed by the Congress and State legislatures. That is not the case. In most cases, a Government department is created and funded by Congress. The head of that department is responsible for writing the code of laws. If the traffic department wants to write a law that has a fine of $300 for sneezing at a stop sign, you pay the fine or hire a lawyer for $1,000.

So, what is happening? We have a President that is starting to eliminate a lot of these directives that gave these agencies regulatory authority over us. The EPA has lost about 770 employees and they are not being replaced. It was those people claiming that the car companies were getting better gas mileage due to their regulations. The truth was, the increased mileage was due to the forced production of more fuel-efficient economy cars than high performance models. By averaging the overall mileage as a group, you got the desired result. You could still buy both, but you paid more for the gas guzzler (get rid of ethanol additive to your gas, and you might even see an extra 4 miles a gallon).

Basically, the President enforces the laws. As chief enforcer, he can write Executive Directives to define how a department functions and can issue directives on how to execute the law. Obama did this with the border guards by limiting their authority to arrest and detain people crossing into our country illegally.

Obama’s presidency was fraught with Executive Directives for everything. Bureaucrats were deciding what was right for you to do or not do. If you didn’t march to their drummer, you were fined or jailed. This ranged from whole wheat bread in school lunches to grazing charges for cattle on government lands.

We are slowly emerging from this Obama fiasco of government regulations for everything, to one of less government regulation. The Trump administration brings anticipation of less supervision and more economic freedom.

Let’s ring in the new year and forget that we are Democrats or Republicans. Of course, with Congress it is very hard to forget what Obama did with health care. He taught the Republicans that he didn’t need them for anything. Attitudes matter, and I think the Democratic party is going to get pay-back in the coming new year. Hopefully less government regulation will turn the economy loose.

Here is hoping the new year 2018, brings prosperity and happiness for all.

From our family to yours, Have a Happy New Year Everyone!

Tuesday, November 28, 2017

Misallocation of Resources in California

Figure it out, if you put your money in a savings account, you get a one percent return. Plunk a million dollars into an 8-unit condo, which rent for about $2,000 apiece (two bed, two bath), the mechanics suggest a return of about $16,000 per month or about $192,000 k per year. Plus, you have a depreciation tax deduction and management expenses to write off. With a return that great, why pay cash for the 8-unit condo? Instead, buy four 1 million-dollar condos and only put 20 percent down on each. This is actually happening in California right now. Only instead of 8 units, we are talking about 80 to 200 units in a complex.

Parents have their children living at home. This is a plus if the kids are paying off their student loans, but becomes a real problem when the kids get married. What can your kid rent on an income of 70k combined in LA or San Diego? Chasing your bride around the house nude, in mom and dads’s home has some drawbacks. So, 30K per year for housing, implies taxable earning of about 40k which is about $19 per hour. Put another way, you need a wife or roommate making the same amount to help pay the bills.

The problem that hasn’t been visible yet, is the fact that, building rentals is still in the creation stage. You don’t just go out a build a rental unit. It takes about 3 to 5 years from start to finish to process and complete the building of a structure. We are presently in about the 8th year of building rentals. Right now, there are a lot of rentals, but no renters at the prices asked.

If a land lord has 100 units and only has 50 percent occupied, he has a real problem. If the rented ones are returning, $2,000 a month, the effective rental rate for the whole structure is $1,000 per unit. Lesson one, the land lord doesn’t set rental rates, the market does. If the mortgage payment is higher than the rental returns, the investment is structured to fail.

The real issue here that people have failed to understand is that the Fed interests rate at .05% forces investing to be more creative. Rental housing in the present environment of low interest rates offers a return of about 15%. The real trap here is that building rental housing is forcing a reallocation of resources artificially, into a market that is already beyond full capacity.

So, what is happening in Kalifornia, high rental rates and a very high number of houses for sale. Its okay to put three families in one structure. What has not truly been comprehended is that housing costs for family units is pretty much constant. Raise the prices and you find two families occupying the space that one family utilized before (move in with mom and dad). It is literally absurd in places, 6 to 8 cars per house. The weird thing, is that a lot of these homes have three car garages and a car in front of every garage door. This suggests that the rental market doesn’t offer the rental deal Mom and Dad have in mind. Kids leaving the nest is a dreaded event.

Right now, there are too many high-priced homes for sale and an oversupply of rentals. Present rental rates suggest that things are just great. Units are renting for $2,500 a month with a $500 move in bonus with two months free with a year lease. This financial structure is the first step towards rent reductions.

These rental complexes are gigantic, 100 to 200 units and all wood frame. Welcome to the new ghettos of the future. The future cash flow projections from these investment vehicles will fail, and be refinanced and rented at lower and lower rates. Of course starting a fire in something this big, for insurance purposes, could send the owner to jail for a very long time.

What we are about to witness in Californai is a collapse in rental prices from oversupply. The forward projection of investing in rental real estate has hit a brick wall. The 10 to 15 percent return rate is no longer there with the surge of new rentals hitting the market. Plus, the tenants per unit is not the same anymore. Two people sign the lease and 8 people move in, with dogs and cats and stereo systems that make you want to scream. But I digress.

When you do the math, how many McDonalds employees does it take to pay the rent? More than one, maybe more than two.

Now you begin to follow the dots on retirement from my previous post. A tent and a post office box to receive your Social Security check each month of $1,400---$46 dollars a day. Retirement in the sun, what a life.

We are at a point to where the politicians have fixed all of our problems as tax payers by sheer incompetence and left an opening for the homeless people, who have adjusted the system to accommodate their lifestyle. The homeless will be oblivious to the future rental market collapse.

Monday, October 16, 2017

The Legislative Thinking Mentality

The other day, on the news, San Diego is contemplating the idea of affordable housing for the homeless. Two problems here, the climate is so mild and it never rains so you don’t need a home, just a tent for privacy and a shopping cart for your belongings. Second, homes cost about $400,000. All a tent cost is about $100 and shopping carts are free. Figure $10 dollars a day for food and booze, no cigarettes, (they’re $10 a pack) you can be a beach bum for less than $3,650 a year. The problem with the tents intensifies when the owner picks up discarded items to more properly furnish his or her domicile. And the issue of trash removal and sanitation is nonexistent. At this point it becomes a health issue.

Then after the tragic Las Vegas shootings, Congress is contemplating tougher gun control laws. Criminals don’t shop at gun stores to purchase a weapon; honest law-abiding people do. There is no law we can pass that will stop someone from repeating what just happened. Almost everyone is entitled to buy a gun, if they do it before they break any laws. People are not born killers, but a law will not stop someone from killing if he is willing to die in the act. All gun laws do is process people into the jail system after they have fired their weapon (if they do not take their own life). Laws do not prevent bad behavior, they only punish it.

With these two examples, you might arrive at the conclusion; Congress believes that there is an obvious legislative solution to all of our problems. Of course, some problems solve themselves. 20 trillion dollars of national debt kind of explains why cigarettes went from 25 cents a pack to $10 dollars.

“Give the rich a tax break,” sets the Democrats ballistic. The bleeding hearts think the rich are obligated to foot the bill. At the same time, I haven’t picked up a newspaper reporting that someone in this country starved to death for any reason. I would bet that more than half of the people in this country on food stamps are severely overweight. Food stamps offer people the cell phone and cable tv option. But I digress.

Congress-i-anal stupidly assumes that low income people will spend their food stamp allotment and other monies on their kids. Not quite. But when anyone wants to change a program, it is pointed out that it is the kids that will lose out. The kids are used to earn more government handouts and believe me, the kids are the last ones to receive any of the trickle down from this. A 12 pack and a pack of cigarettes is $28.00 and the kids don’t get to drink the beer or smoke the cigarettes. They grow up eating macaroni and cheese with an occasional hot dog and some Kool aid. As a kid, I knew some of these kids, they would marvel at our refrigerator when they came over, it had food in it!

Reality is out there, it just depends on how your mind colors the pictures. Government should not be there to fix our problems, but rather to pay the bills.

California is the land of half million-dollar homes, and a climate that lends itself to the homeless on a $3,600 a year budget. Food stamps, a cell phone and a surf board, what a life!

Governor Jerry “Moon Beam” Brown will probably even get them registered to vote to boot. And then there is marijuana legalization. That old biblical story of Sodom and Gomorrah comes to mind. The Democrats have started a party that even Harvey Weinstein might want to attend/fund.

Monday, October 02, 2017

Restaurant Menu Prices 1938

Here is a reprint from four years ago for some of you that might have missed it. This was during the Great Depression that was already into its 10th year.

I was searching through some picture albums of my parents from way back and ran into some restaurant menus  from the depression era of late 1930's.. The first 3 pictures are from the Manhattan  Restaurant


The Second menu (three pictures) is on the Union Pacific Railroad from 1937 somewhere in Wyoming.

This last menu is from the Hotel Windermere in Chicago 1937.

Double click on the images to see what the prices were back then.   Did you notice that the Manhattan offered a broiled (Whole) lobster for 65 cents?  In today's world, you'd be lucky to get half a lobster for $30.  Bear in mind, the people that read these menus in real time are probably dead by now.

The pay raise that everyone gets each year because of inflation is just an allusion. Look around, the new hires are starting out a few pennies less than what the seasoned workers are making.  The neat thing about inflation is that Congress doesn't have to raise the tax rates, you earn more, you pay more.  That's the real difference between the Democrats and Republicans; print as you go verses pay as you go.

The real odd thing is that the average person does not connect the dots. The relationship between government spending and inflation does not exist. Rumor has it, we've always had inflation-- I guess we're supposed to get used to it.  My wife bought a new battery and asked me to guess how much she paid for it, and I said $40.  Her answer; "That's the price you would have paid 20 years ago, the battery was $100."

Let's see,(from top menu third pic red part) I'll have the broiled lobster with coffee and a slice of cake--that's about 85 cents total, plus 15 cents for a tip.  The trouble is, 76 years of inflation have raised the prices a tad.