Newsletter about the City Council meeting of December 18, 2012

 This newsletter is about the Hickory City Council meeting that I attended this past week. City council meetings are held on the first and third Tuesdays of each Month in the Council Chambers of the Julian Whitener building.

At right of this page under Main Information links is an Hickory's City Website link. If you click on that link, it takes you to our city’s website, at the left of the page you will see the Agenda's and Minutes link you need to click. This will give you a choice of PDF files to upcoming and previous meetings.

You will find historic Agenda and Minutes links. Agendas show what is on the docket for the meeting of that date. The Minutes is an actual summary of the proceedings of the meeting of that date.

Here is a summary of the agenda of the 12/18/2012 meeting. There were a couple of important items that were discussed at this meeting and the details are listed further below:

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 All materials and maps for this meeting are provide at this link: 

City Council Action Agenda - December 18, 2012 - Mayor Wright and Alderman Seaver not Present



Invocation by Rev, Bud Zehmer, Pastor Church of the Master United Church of Christ

Special Presentations
A. (2:30) - Presentation of a Proclamation to Hickory Jaycees


Council allowing Citizens to speak about Agenda Items
At the 7:00 mark, James Davis makes the following presentation to the City Council:

Council members, I appreciate you allowing me to address items of concern on the Agenda that you are set to vote upon. I am asking that the Budget Ordinance Amendment Item Number 2 be removed from the Consent Agenda for further discussion, because it does not fit with the Parking Fund Ordinance created by a Previous Council and City Administration.

Allow me to read the ordinance to you that was passed out to you.

It is my belief, and that of the Citizens for Equity in Government, that this was the issue with the tent constructed last year on Union Square. It had nothing to do with parking. So, you broke the law that you have sworn to uphold.

As section one states, this money is set aside for funding future parking facility Capital project needs. This fund was created to increase Parking Capacity and address its issues, not for the security purposes of Union Square businesses. Let's be honest these cameras have a lot more to do with securing Union Square's private business interests, than securing the parking lots associated with Union Square.

The businesses on Union Square should address their own security issues like every other private business in other areas of the city have to do. We understand the desire for security, but if Union Square businesses want to collectively improve their security, then should they not be doing this through the Downtown Development Association? Wasn't that what that entity was created for?

Now y'all can go on and unanimously do what you intended to do all along, but thank you for allowing us to go on the record about the continued misappropriation of this fund.



Consent Agenda: (12:10)
A. Transfer of a Cemetery Deed from Robert Edgar Lail, Jr. and wife, Kathy Robinette Lail, Trudy Diana Austin Brower, Widow and Sarah Elizabeth Lail Eaton, Widow, to Jeanette Frances Lail Pittman in Oakwood Cemetery

B. Approval to Extend Public Parking Area in the Large Parking Lot (Lot#2) across North Center Street from City Hall. - Traffic Division has studied the parking lot (Lot #2) located across North Center Street from City Hall. Currently in the parking area, which is two-hour parking, there are thirty seven (37) spaces which include two handicapped spaces. If the public area is increased to match the shape and layout of the parking lot, this will increase the number of public parking spaces to fifty-four (54). Also, by increasing the time restriction from two hours to three hours, any visitors will have more time to explore downtown.

C. Approval of an Agreement for Future Voluntary Annexation for Superior Homes and Land located at 1842 22nd Street NE, PIN No. 3713-12-97-6105. - Superior Homes and Land request connection to the City of Hickory’s water and sewer system without being annexed. The property is located in the City’s extra-territorial jurisdictional area. An analysis has determined the annexation of the property would not be economically feasible for the City of Hickory at the present time. They have agreed to be annexed at some time in the future, when the City finds it economically feasible to do so.

D. Call for Public Hearing – Regarding the Financing Concept for the Hickory-Catawba Wastewater Treatment Facility Upgrade and Expansion. (Authorize Public Hearing for January 2, 2013)

E. Approval of a Resolution supporting an application to the Local Government Commission for the financing agreement for the Hickory-Catawba Wastewater Treatment Facility upgrade and expansion. In order for a local government in North Carolina to finance a project, approval is to be obtained from the Local Government Commission (LGC). The LGC requires a resolution be passed by City Council prior to the LGC’s approval of the financing agreement application. In order to meet the application deadline, the completed LGC application must be received more than 28 days prior to the scheduled LGC meeting on February 5, 2013. The resolution resolves that the City is in financial standing to finance this project using the installment purchase debt method without raising taxes, and includes an opinion by the City’s Attorney that the proposed project is authorized by law.

F. Approval of a Deed of Easement for Bus Shelters from the City of Hickory to the Western Piedmont Regional Transit Authority. - The City has erected and maintained a number of bus shelters throughout the city and also in the Newton area over a number of years. Some shelters were erected when the City operated the Piedmont Wagon Transit System; some have been erected since the creation of the Western Piedmont Regional Transit Authority (WPRTA). When the WPRTA was formed, the plan was for the new authority to assume the operation and maintenance of the shelters.

G. Citizens’ Advisory Committee Recommendations for Assistance through the City of
Hickory’s Housing Programs - The following request was considered by the Citizens’ Advisory Committee at their regular meeting on December 6, 2012:

 Nancy Braswell was approved for recommendation to City Council for first-time
homebuyer’s assistance to purchase a house located at 452 South Center Street, Hickory. She had requested $6,500 for assistance with down payment and closing costs. The First-Time Homebuyers Assistance Loan is zero interest, no payments and repaid upon sale, refinance or payoff of first mortgage.

Funds are budgeted for these items through the City of Hickory’s Rental Rehabilitation Program income received in FY 2010 and/or program income received through the City of Hickory’s Community Development Block Grant Program. The following applicant is being recommended for approval for assistance under the City of Hickory’s 2011 Urgent Repair Program. This program provides qualified low income citizens assistance for emergency-related repairs not to exceed $6,000.

 Dorothy Adams, 235 10th Avenue SE, Hickory, not to exceed $4,880. (Used $1,120 in URP10 funds)


H. Approval of a Proclamation for Kappa Alpha Psi Fraternity Day, January 11, 2013.

Budget Ordinance Amendment
1. To transfer $40,283 of General Fund Contingency to the Governing Body Professional Services-Elections line item. This amendment is necessary to pay Catawba County Board of Elections for expenses incurred for the Referendum Election held on September 18, 2012.

2. To appropriate $23,302 of Capital Reserve Parking Fund and transfer to the Public Buildings M&R of Equipment line item. This budget amendment is necessary to pay for the upgrade to the downtown parking lot camera system. With addition of the new cameras, the system has outgrown what the infrastructure can support. The upgrade will add storage, increase bandwidth and upgrade the software platform to allow for the number of cameras now installed on the network.
(Item pulled from the Consent Agenda - Citizen James Davis asked that the item be pulled and Alderman Lail initiated the process with Alderman Meisner and Alderman Lail making the motions to remove the item) - Discussed by the Council and given unanimous approval 5-0 mayor Wight and Alderman Seaver were absent

3. To appropriate $7,597 of Transportation Fund Balance and budget in the FBO Maintenance & Repair of Buildings ($5,000), Departmental Supplies ($1,600) and Fuel and Motor Oil ($997) line items. $7,597 of Miscellaneous Airport Revenue went into the Transportation Fund Balance at FY11-12 year end; therefore an appropriation is necessary to make those funds available for purchases this fiscal year.

Informational Items
A. Report of Mayor Rudy Wright’s travel to North Carolina League of Municipalities, Transportation Forum, Raleigh, NC on November 14-15, 2012 (Lodging - $111.63, Meals - $34.00)

New Business - Public Hearing
1. (15:00) Voluntary Annexation of City owned property located at the corner of 21st Street NW and 9th Avenue Drive NW. - The City of Hickory has submitted a petition for the contiguous voluntary annexation of .87 acres of property located at the intersection of 21st Street NW and 9th Avenue Drive NW, which is part of the tract occupied by the Hickory Municipal Airport. The City of Hickory maintains 21st Street NW which follows a north to south route from Clement Boulevard NW to 9th Avenue Drive NW. Although the street is used by the general public, the right-of-way was never dedicated for such. This public hearing was advertised on December 7, 2012 in a newspaper having general circulation in the Hickory area. Cal Overby Presentation. Council Unanimous Consent.

2. ( 19:50)  Resolution Directing Street Improvement Project be Undertaken Along a Portion of 304 and 336 10th Ave NE for Curb and Gutter, Petition No. 02-12 - The City Clerk has received a petition from the owners of property along a portion of 10th Ave NE, to install curb and gutter per Section 29-2 of the Hickory City Code. The signatures on the petition represent 100% of the property owners affected. The City Clerk has certified that the Preliminary Resolution adopted by the City Council on November 20, 2012 was mailed by first class mail on November 29, 2012 to the owners of the property subject to assessment should the project be undertaken. This petition comes to us through our normal curb and gutter process where both the property owner and the City participate in the costs. This public hearing was advertised in a newspaper having general circulation in the Hickory area on December 3, 2012. Council Unanimous Consent.

3. (21:35) Resolution Directing Street Improvement Project be Undertaken Along a Portion of 304 10th Ave NE for Sidewalk, Petition No. 03-12 - The City Clerk has received a petition from the owners of property along a portion of 10th Ave NE, to install sidewalk per Section 29-2 of the Hickory City Code. The signatures on the petition represent 100% of the property owners affected. The City Clerk has certified that the Preliminary Resolution adopted by the City Council on November 20, 2012 was mailed by first class mail on November 29, 2012 to the owners of the property subject to assessment should the project be undertaken. This petition comes to us through our normal sidewalk process where both the property owner and the City participate in the costs. This public hearing was advertised in a newspaper having general circulation in the Hickory area on December 3, 2012. Council Unanimous Consent.

4. (22:50) Resolution and Order for Petition of Robert Lee Combs Jr., Cynthia C. Combs; Kenneth R. Abernethy, Linda Yvonne McCall Abernethy; Patricia Abernethy Bolch and Alan C. Bolch to Close a Portion of 10th Avenue Place NE, in the 400 Block. - On October 5, 2012, Attorney Terry Taylor, presented a petition on behalf of Robert Lee Combs Jr., Cynthia C. Combs; Kenneth R. Abernethy, Linda Yvonne McCall Abernethy; Patricia Abernethy Bolch and Alan C. Bolch, the owners of property abutting a portion of 10th Avenue Place NE, in the 400 block, requested the City to abandon a portion of this right-of-way. This portion of the right-of-way is no longer necessary for public use and appears the closing is not contrary to public interest. Staff recommends that the City retain all utility easements. This public hearing was advertised in a newspaper having general circulation in the Hickory area on November 23, November 30, December 7, and December 14, 2012. Council Unanimous Consent.

Citizens Requesting to Be Heard

(26:00) Cliff Moone -  Cliff spoke once again about the process that has been instituted in relation to allowing Citizens to be heard before votes are taken in relation to second readings,  Consent Agenda Items, and Departmental Reports.

At the end of the meeting Council voted affirmatively to form a subcommittee to formally put this process, allowing Citizens to be Heard before votes are taken, on the Agenda.


Newsletter about the City Council meeting of October 2, 2012 - Addendum on the CEG proposals -
Proposal introduced by the Mayor outside of the constructs of the agenda

Newsletter about the City Council meeting of November 20, 2012 - Cliff Moone addressed the issue of Citizens being allowed the question items on the agenda at the beginning of the meeting. He discussed what occurred at the October 2, 2012 meeting.

Newsletter about the City Council meeting of December 4, 2012 -  Cliff Moone addresses the City Council about the Council's new policy odf making a motion to allow citizen's to address the City Council about items on the Agenda. Cliff and all members of the Citizens for Equity in Government feel that the Council is proverbially flying by the seat of their pants on this. Second they are not following proper protocol, because this is nowhere to be found on the Public Agenda, so technically it is a matter not on the Agenda and should by statute come at the end of the meeting after Citizens Requesting to Be Heard, which takes us back to square one. Hickory Inc. wants to say what's the big deal and we agree. Since it isn't a big deal, then formally put in on the agenda and quit with the ruse.

Hickory City Council Meeting - December 18, 2012 - Video Presentation

The Following is a video presentation of the Hickory City Council meeting of December 18, 2012.



Two important presentations were made for the benefit of the Citizens of Hickory on this night. At the 7:00 mark, James Davis makes the following presentation to the City Council:

Council members, I appreciate you allowing me to address items of concern on the Agenda that you are set to vote upon. I am asking that the Budget Ordinance Amendment Item Number 2 be removed from the Consent Agenda for further discussion, because it does not fit with the Parking Fund Ordinance created by a Previous Council and City Administration.

Allow me to read the ordinance to you that was passed out to you.

It is my belief, and that of the Citizens for Equity in Government, that this was the issue with the tent constructed last year on Union Square. It had nothing to do with parking. So, you broke the law that you have sworn to uphold.

As section one states, this money is set aside for funding future parking facility Capital project needs. This fund was created to increase Parking Capacity and address its issues, not for the security purposes of Union Square businesses. Let's be honest these cameras have a lot more to do with securing Union Square's private business interests, than securing the parking lots associated with Union Square.

The businesses on Union Square should address their own security issues like every other private business in other areas of the city have to do. We understand the desire for security, but if Union Square businesses want to collectively improve their security, then should they not be doing this through the Downtown Development Association? Wasn't that what that entity was created for?

Now y'all can go on and unanimously do what you intended to do all along, but thank you for allowing us to go on the record about the continued misappropriation of this fund.

------------------------------------------------------------------------------------------------------------------------

The next presentation was made towards the end of the meeting during Citizens Requesting to be Heard by Cliff Moone at the 26:00 mark.

Cliff spoke once again about the process that has been instituted in relation to allowing Citizens to be heard before votes are taken in relation to second readings,  Consent Agenda Items, and Departmental Reports.

At the end of the meeting Council voted affirmatively to form a subcommittee to formally put this process, allowing Citizens to be Heard before votes are taken, on the Agenda.

Economic Stories of Relevance in Today's World -- December 16, 2012

Sorry Protesters: Your Jobs Are Being Sent To China And They Aren't Coming Back - The Economic Collapse Blog - Michael, - December 11th, 2012 - Did you see the huge crowds of protesters that flooded the Michigan Capitol on Tuesday?  They were there to protest two bills there were being considered by the state legislature that would limit the power of unions in the state.  Michigan lawmakers approved the bills and this absolutely infuriated the protesters.  There is a lot of passion on both sides of this debate, but I am afraid that both sides in this debate are missing the bigger picture.  If we keep shipping millions of our jobs to China, there isn't going to be work for anyone no matter how much power unions have or don't have.  During the month of October, the U.S. trade deficit increased to 42.2 billion dollars.  Our trade with China accounted for most of that deficit.  Our trade deficit with China in October increased to a new all-time one month record of 29.5 billion dollars.  Nearly 30 billion dollars that could have gone to U.S. businesses and U.S. workers went to China instead.  Since 1975, a total of about 8 trillion dollars that could have gone to U.S. businesses and U.S. workers went to the rest of the world instead.  Shiny new factories are going up all over China, and meanwhile our once great manufacturing cities are degenerating into desolate wastelands.  So what is going to happen when all of the good paying manufacturing jobs are gone?  Are we all going to fight bitterly over whether we should unionize the low paying jobs that remain at places such as Wal-Mart and McDonalds?  Such an approach is not going to bring back prosperity to America.  We desperately need to start building things and start creating real wealth inside this country once again.  We desperately need to stop sending tens of thousands of businesses, millions of jobs and trillions of dollars of our national wealth out of the country.  Unfortunately, I don't see anyone out there holding protests about our trade deficit.  Nobody really seems to care, so our economy will continue to bleed good jobs and the middle class will continue to be destroyed.
The funny thing is that the workers that are out there protesting these union bills actually voted for the politicians that are killing their jobs.  Both parties are married to the one world economic system and the "free trade" agenda, and Barack Obama has been one of the worst offenders.  He has been pushing for more "free trade agreements" throughout the past four years, and yet union workers continue to support him enthusiastically.                             How foolish can they possibly be?
Yeah, let's merge American workers into a global labor pool with workers in third world countries on the other side of the globe that work in absolutely nightmarish conditions for as little as 45 dollars a month.  That sounds like a great idea, doesn't it?                       Oh, but you don't want to work for 45 dollars a month?                        You don't even want to work for 450 dollars a month?                    Well, then the big corporations that fund politicians like Obama will just take your jobs and send them halfway around the planet.                       Do you think that your unions will save your jobs?
Michigan already has the highest rate of union membership in the Midwest.                  It also has the highest rate of unemployment in the Midwest.                      Over the past couple of decades, thousands of businesses in Michigan have either closed down or moved facilities overseas.                 Did the unions prevent any of that? No.                              If union bosses really wanted to do some good, they would be organizing protests against our incredibly foolish trade policies.                     But instead, they tell their members to vote for politicians like Obama and then they run out to the stores and fill their carts with huge piles of products that were made in China.                          Union workers need to wake up to one fundamental economic fact - in a one world economic system, the big corporations simply do not need you.  They can make their products in lots of other countries where it is legal to pay slave labor wages.                              But instead of getting upset about what is really killing their jobs, union workers in Michigan are screaming mad about a couple of new laws that will take some power away from the unions.                            That is kind of like being obsessed with a broken fingernail when your leg has just been sawed off and you are gushing blood all over the floor.                           Oh, but union workers did put on a good show up in Michigan.  The following is how a Bloomberg article described the protests...



We Are Witnessing The Death Of Small Business In America - The Economic Collapse Blog - Michael - December 13th, 2012 - Historically, small businesses have been the primary engine of new job creation in the United States.  If the economy was getting healthy, we would expect to see the number of jobs at new businesses rise.  Instead, we are witnessing just the opposite.  We are told that the economy is supposed to be "recovering", but the number of "startup jobs" at new businesses has fallen for five years in a row.  According to an analysis of U.S. Department of Labor data performed by economist Tim Kane, there were almost 12 startup jobs per 1000 Americans back in the year 2006.  By 2011, that figure had fallen to less than 8 startup jobs per 1000 Americans.  According to Kane, the number of jobs in the United States at businesses that are less than one year old has fallen from 4.1 million in 1994 to 2.5 million in 2010.  Overall, the number of "new entrepreneurs and business owners" has fallen by more than 50 percent as a percentage of the population since 1977.  The United States was once known as "the land of opportunity", but now that is fundamentally changing.  At this point we truly do have a "crisis of entrepreneurship" in this country, and that is a huge reason why America is in decline.  We are witnessing the slow death of the small business in America, and that is incredibly bad news for all of us.                   Unfortunately, the problems that small businesses are experiencing right now have been building up for decades.  The economic environment for small businesses in America has become incredibly toxic.  Sadly, we can see this in the numbers.  According to Kane, the following is how the decline in the number of startup jobs per 1000 Americans breaks down by presidential administration...
Bush Sr.: 11.3        Clinton: 11.2         Bush Jr.: 10.8         Obama: 7.8
Obviously, we are headed very much in the wrong direction.  Kane speculates about why this may be happening in his paper...

Even as we witness the death of the small business in America, corporations are absolutely thriving.  The following chart shows how corporate profits after tax have exploded to new record highs in recent years...

So has this been good for workers?  No, it has not translated into more jobs and higher wages.  In fact, wages and salaries as a percentage of GDP are now at an all-time low...

The Great Decoupling of the US Economy - Andrew McAfee's Blog - The Business Impact of IT - December 12, 2012 - The French call the thirty years after the war les trente glorieuses, reflecting the shared economic prosperity of the period. Well, we had a bit more than trente spectaculaires of our own.                            In the early 1980s the picture started to change for the average American worker. There were still a lot of jobs available, but they started to pay less well. Median household income became decoupled from the other three stats and grew more slowly than they did. By the time of the 2001 recession, median income was lagging behind pretty badly. If we’re going to stick with Gallic labeling, the years between 1982 and 2001 were the vingt troublantes.                                   By the end of 2011, things had become much worse in two ways. First, median household income was actually lower than it was a decade earlier. In fact, it was lower than at any point since 1996. And second, the American job creation engine was sputtering badly. Between 1981 and 2001 the economy generated plenty of low-paying jobs. After 2001, though, it wasn’t even generating enough of these, and employment growth started to lag badly behind GDP and productivity growth (on all three graphs here, GDP growth is charted on a separate axis because it grows more quickly than the other three). The last ten or so years have been les dix déprimantes.

What’s going on? Why have the things that workers care about – jobs and wages – become decoupled from the the other things that  economy-watchers care about? So far, explanations for this unhappy phenomenon include tax and policy changes, and the effects of globalization and offshoring. These are clearly powerful forces, but there’s one other one: technological progress.                       I’ve been talking a lot about this latter force here and elsewhere, and it’s the subject of Race Against the Machine, a short e-book Erik Brynjolfsson and I wrote that came out a bit more than a year ago (we’re working on a full-length sequel now).                                 Our argument, in brief, is that digital technologies have been able to do routine work for a while now. This allows them to substitute for less-skilled and -educated workers, and puts a lot of downward pressure on the median wage. As computers and robots get more and more powerful while simultaneously getting cheaper and more widespread this phenomenon spreads, to the point where economically rational employers prefer buying more technology over hiring more workers. In other words, they prefer capital over labor. This preference affects both wages and job volumes. And the situation will only accelerate as robots and computers learn to do more and more, and to take over jobs that we currently think of not as ‘routine,’ but as requiring a lot of skill and/or education.                          As a result, I don’t see the four lines in the graphs above re-converging any time soon.


The food stamp economic recovery – Food stamps increase by over 600,000 in last month of data. GDP at record levels yet US employment is 4 million below start of recession. - My Budget 360 - There was a startling figure that came across my desk from the United States Department of Agriculture regarding food stamp usage in the SNAP program.  Food stamp usage has grown dramatically in the last decade even during the debt inspired boom times.  Yet the devil is always in the details as we reported with the unemployment rate really dropping because of the over 500,000 Americans simply dropping out of the labor force.  The food stamp figures are stunning because they show in the last two months food stamp usage has skyrocketed by over 1,000,000.  In the last month of data observation, food stamp usage increased by more than 600,000.  Keep in mind to qualify for food stamps you have to carefully demonstrate that you are earning very little and technically are classified as being in poverty.  So what does it say that our nation now has 47.7 million Americans on food stamps?                       Our Gross Domestic Product is now at record levels yet we are doing this with over 4 million workers less than in 2007.                 

The reason this is possible is that income inequality is simply growing more dramatically.  That is why on one side of the spectrum we see big financial institutions back to making big bets and earning big bonuses while in the last month of data, we added 600,000 more Americans to the food stamp system.  If you want to visualize how things have played out since the recession began here is an excellent chart:

        
These figures are important.  You might be asking how this occurring in a supposed recovery.  A large part of this growth is being juiced up by massive debt programs and pseudo-debt and money creation programs like QE3:

  


QE 4: Folks, This Ain't Normal - What You Need To Know About The Fed's Latest Move
Tyler Durden's picture - Zero Hedge - Tyler Durden - December 14, 2012 - Okay, the Fed's recent decision to boost its monetary stimulus (a.k.a. "money printing," "quantitative easing," or simply "QE") by another $45 billion a month to a combined $85 billion per month demonstrates an almost complete departure from what a normal person might consider sensible.                         To borrow a phrase from Joel Salatin: Folks, this ain't normal. To this I will add ...and it will end badly.                              If you had stopped me on the street a few years ago and asked me what I thought would have happened in the stock, bond, foreign currency, and commodity markets on the day the Fed announced an $85 billion per month thin-air money printing program directed at government bonds, I never would have predicted what has actually come to pass.                             I would have predicted soaring stock prices on the expectation that all this money would have to end up in the stock market eventually. I would have predicted the dollar to fall because who in their right mind would want to hold the currency of a country that is borrowing 46 cents (!) out of every dollar that it is spending while its central bank monetizes 100% of that craziness?                        Further, I would have expected additional strength in the government bond market, because $85 billion pretty much covers all of the expected new issuance going forward, plus many entities still need to buy U.S. bonds for a variety of fiduciary reasons. With little product for sale and lots of bids by various players, one of which – the Fed – has a magic printing press and is not just price insensitive but actually seeking to drive prices higher (and yields lower), that's a recipe for rising prices.                       Then I would have called for sharply rising commodity markets because nothing correlates quite so well with thin-air money printing as commodities.                       That's what should have happened. But it's not what we're seeing.                         Instead, stocks initially climbed but then closed red. Gold was mysteriously sold in the thinly-traded overnight markets and again right after the announcement in large, rapid HFT blocks that swamped the bids. U.S. Treasury bonds actually sold off on the news. The dollar hardly budged. Commodities were mixed across the board but more or less flat on the day, with the exception of the metals, and especially the precious metals, which were sold vigorously.                     The markets are now well and truly broken. Not because they don't conform to my predictions, but because they are no longer sending useful price signals. Instead, my hypothesis here is that the markets are now just a giant and rigged casino, where a relative handful of big firms and other tightly coupled players are gaming their orders to take advantage of this flood of money.                      When your central bank badly misprices money and then bids up everything related to bonds, nothing can be reasonably priced. Risk is mispriced; the few remaining investors (as distinct from speculators, which are now the majority) are forced to accept both poor yields and higher risk – so we know the price of everything, but the value of nothing.                         QE4 - So what exactly is this new thin-air money printing program all about? Well, unlike any prior Quantitative Easing (QE) announcement, this one was tied to a fuzzy and quirky government statistic: the unemployment rate...                             The odd thing here is that by tying their policy to the unemployment rate, we could be in for a very long wait for the stimulus to end.  The reason is that the unemployment rate has a couple of moving pieces, one being the number of people who are unemployed, and the second consisting of people who have given up looking for work, which is tracked in something called the 'participation rate.'                             As more people leave the labor force and the participation rate goes down, the unemployment rate goes down, too.  Somewhat confusingly, as more jobs are created, the unemployment rate goes down, too.  As you can see, these numbers work in opposition to each other because as more jobs become available, more people re-enter the work force.                            Before the crisis struck, the participation rate was around 66.5%. But now it sits at just 63.6%, meaning that, at roughly 1.4 million jobs for each percent, a bit more than 4 million jobs would have to be created just to absorb the folks who left the labor force but presumably would like to work again. As those 4 million folks come back to work, the unemployment rate will not budge at all.

Ron Paul's Farewell Speech to Congress 

 

Fiscal Cliff Bwahaha -- The Three Card Monte System

I have already personally responded about the issues with the Republican Party and it has been all over the Hound over the last four years. Harry makes legitimate points about how the Republican Party has voluntarily cornered itself by having single themed simplistic messages that don't address the needs of most of the American public. The Republican Party has not had a coherent message of ways to move forward and back towards prosperity for the working class. And the Republican Party has not displayed leadership towards the future and has chosen to follow the path of the entrenchment of the career politician, which goes against the grain of Conservative Principles set forth in the "Contract with America" nearly twenty years ago.

A friend sent me a message the other day that is right on:

LETTER to the EDITOR-- MINNEAPOLIS STAR TRIBUNE

Let's look at what we have learned from this election:

Twenty-one of 22 incumbent senators were re-elected, and 353 of 373 incumbent members of the House were re-elected.

The American people have re-elected 94 percent of the incumbents who were running for re-election to an institution that has an approval rating of about 9 percent.

This indicates, as an electorate, we are a nation of idiots.

Now I have friends from across the spectrum. I talk to everyone and try to understand people and get them to understand where I am coming from. I don't believe in Redneck World Wrestling Politics. I believe in studying issues and finding compromise where I can and moving forward in a constructive manner where I have disgreements with others. Rednecks don't do this. They draw corners and have a P***ing match and think they are accomplishing something by seeing who can P*** further. Nothing substantial ever happens. I am sick of that and those A-holes need to be drawn and quartered.

And like another friend articulates about the Democrats. The Democrats talk about the Republicans and Bush and we are like yeah uh-huh and besides the debt, deficit, impinging on our liberties, and getting us involved in two wars that there are apparently no ends to, they increased the ethanol subsidies to take care of their buddies in the Midwest and this caused corn prices to nearly quadruple in the last decade, they went along with the deregulation of Wall Street and its marriage to Washington, and they worked to offshore our working class jobs through NAFTA and GATT and a hundred other Free For All Trade Agreements.

Now let's talk about Obama, who said he was going to end the wars, instead we are looking to be headed into Syria soon and Iran right after that and more troops die in Afghanistan virtually every day.. ohh and Pakistan. We look at the issues with Wall Street, which is full scale corruption; and which seems to be getting worse, not better. Who have charges been brought against, but they'll fry some poor guy that can't afford their taxes. We look at problems with running up our debt, which I will go into further in a second.

They say No. No. No. Obama all good... Repubwicans all bad. I say B* S*.

And then there is the talk about the Fiscal Cliff.

Folks we have already gone over the Fiscal Cliff long ago. We could have dealt with this 4 1/2 years ago, but no one wanted to. We had time to reform, but no one could see, because they are Economic Idiots. It was going to be painful then, but it will be exponentially worse now. The National Debt has gone up from $10 trillion to $16.4 trillion in the last four years. That is a 64% increase in four years. In 2004 it was $7.4 trillion, which means that over the 4 year span (2004-2008) the deficit went up   35%, which still is horrible, but you can see the acceleration can't you?

So if the National Debt only went up 35% over the next four years, then it would be (16.4 x 1.35) = $22.1 trillion in 2016. If it increased at the current pace, then it would be (16.4 x 1.64) = $26.9 trillion in 4 years. If it increased at the accelerated pace (1.35 to 1.64) = ^1.99% pace, then it would be (16.4 x 1.99) = $32.6 trillion at the end of 2016. That means that we are going headlong towards oblivion.

There won't be some cataclysmic moment. It is going to be like a boiling frog. Slowly, but surely the costs of necessities are going to accelerate. I have shown it to you here on the Hound. Look at the prices in the grocery store. Maybe you are ignorant enough to not notice the way that they have repackaged the products. Nip an ounce here and add some filler there, yep that's the new American Economic system. The Ponzi economy leading to the Great American Ripoff.

I am tired of the Three Card Monte system. Everyone expects the world to shake when this all goes down. The dinosaur media at every level is in bed with the Government Incorporated. They get you all worked up about whatever the talking point of the day is, while the bureaucracy slides around to pick your pocket.

Everyone is worried about their taxes going up or their benefits getting cut, when they can't seem to grasp that the purchasing power of their money is worth less or worthless.  $100 of goods today cost $74.44 in 2000...  $17.51 in 1971, when we went off the Gold Standard... and $4.28 in 1913, when the Federal Reserve was created. And this is when looking at it through the Governments cooked book calculations, the Consumer Price Index produced for the Bureau of Labor. Other Calculators, such as Shadow Stats, show the 1971 number to be $4.98 and the 2000 number to be $33.88.

Your Standard of Living isn't being destroyed because it is being taxed away or Big Daddy Government isn't giving you enough. Your Standard of Living is being destroyed by the Federal Reserve, because the President and the Congress don't want to make the hard choices and they have their priorities out of whack. The President even seems to think it best to have no debt limit at all and he  has chosen to let the banks be in charge of our money and the bank managers have naturally chosen to look out for their own self interests. The Federal Reserve is putting $40 billion dollars into the system every month by purchasing U.S. Treasury bonds, which allows the Treasury to create money. This money is injected into the banks through nearly ZERO % loans. The banks, now being Financial institutions instead of holding corporations, are going out and purchasing commodities through hedging and derivatives processes. Too many dollars chasing too few goods leads to (Supply and Demand) prices going up.

Your average politician doesn't feel guilty, because they don't understand this. They don't understand MONEY. They really only understand the money in their own bank account and they haven't a clue about yours, nor do they care... Can you vote yourself a raise? Are most of your meals subsidized or paid for? Is your healthcare paid for? Is your retirement set?  

I do appreciate the President and his Economic team taking the ideas that have been discussed here on the Hound. 90% of the people in my community don't understand the significance of this News Source. At least the politicos pay it some attention. I see you ;)

I can't take the credit for "The Race to the Bottom" term that I talked about in April 2010,  I heard Catherine Austin Fitts talking about it about 3 years ago; but the Hound was the first to coin the term  "Middle-Out Economics," introduced here when the President only wanted to talk about the bottom up. I have discussed this since the inception of the Hound. I only wish that his regime would be interested in substantive processes to bring the economy back to equilibrium. Right now there is a war against the Middle Class. It is one thing to talk about jobs. What are you going to do to bring the jobs back to America? What are you going to do to level the Labor Price Parity Dynamic?

The problem is the Middle Class is asleep and frankly I am tired of going to them and trying to wake them up. It is a lot easier to sit back and wait for them to fall and then they wake up on their own and study what has been going on like I had to six years ago. Those who choose to find a way out will join us. Those looking to be bailed out will join the Empire of Rot.



Catherine Austin Fitts interview about Fiscal Cliff at Minute 39

A Response to Harry's GOP Hand Wringing Article - By Talferris

We have talked about this many times, but reading this piece inspired me to respond. First of all, I don’t see it as middle class neglect as it is middle class destruction. When you sit and see the likes of Mitch McConnell willing to throw a huge number of people under the bus by denying or delaying unemployment, or willing to let the tax rate increase on all people and the austerity cuts that are waiting in the wings that will, in all likelihood, send us into another depression, just to not increase the rate on the top 2% of earners, that says something to me.

The Republican party, by in large have never been about or for the middle or lower classes. And lest we forget, there is an entire class of people under the middle and upper classes that fight and struggle to survive each and every day. Sure, we can say that about everyone at the present, but it rings more so with them than others. The ones it rarely affects, those at the top, are too busy looking at things as they were, as they used to be, and how to keep their wealth and grow it under the guise of being “job creators” by investing their excess wealth in the stock market or hiding it off shore in tax havens and shelters.

As an economist, you know that the way to grow any economy is to keep money circulating. A mass of people that have purchasing power are a better engine for the economy than a few at the top that buys high end cars, mansions, vacation homes, and expensive baubles to adorn themselves with. Demand for consumer goods generates manufacturing, improving wages, working conditions, and keeps that money circulating throughout the entire population.

When you have a few at the top that now have the accumulated wealth of over half of the rest of the population, that translates into power. The power to control trade regulation that is beneficial to themselves, the power to change labor and import laws to benefit themselves and their endeavors. And the ability to put out the propaganda to garner support for those over-riding goals to convince enough people that they should buy in this premise as well, giving Republicans the ability to accomplish what is best for them.