CEO have big paydays as workers go broke

It pretty common now a days to hear about company having huge lay offs and it is also common to hear news about CEOs and other top executives making large sums of money and still receiving huge bonuses.



Many times both things happen at the same time, while a company lays off a lot of people the people at the top get paid more and more.



It’s a pretty good scam when one thinks about it. Free up some company cash to make sure you get a little (and by little I mean a lot) extra cash to stick into your pockets. The funny thing is that the boards (unless they are the people getting the extra loot) and stockholders of these companies let these people do this, even when these steps don’t make logically sense.



Yes when a company is doing poorly it can make since to cut jobs. Which makes this odd is the number of times we see reports of a company being said to not be performing as well as it used to and needs to have lay offs just to make it but at the same time top executives are getting huge pay checks and bonuses. If a company is doing so poorly one needs to fire a lot of people then on would think that a company is doing so poorly that the people at the top shouldn’t award themselves.



It’s a flaw in the economics of our corporations. Stockbrokers our happy about the short term fix but don’t bother to ask “Hey how is giving the CEO and President lots of money making this company profitable?” If they did then in a number of cases people will realize that these action aren’t always the best (both for health of the company but also the economy.) They could either use this freed up cash to either would lower the number of new people dumped into or labor market or the money will be used by the company for other things like put it in R & D, marketing or any other area that can will look for new markets or improve the ones they already are in.

CEO have big paydays as workers go broke

It pretty common now a days to hear about company having huge lay offs and it is also common to hear news about CEOs and other top executives making large sums of money and still receiving huge bonuses.



Many times both things happen at the same time, while a company lays off a lot of people the people at the top get paid more and more.



It’s a pretty good scam when one thinks about it. Free up some company cash to make sure you get a little (and by little I mean a lot) extra cash to stick into your pockets. The funny thing is that the boards (unless they are the people getting the extra loot) and stockholders of these companies let these people do this, even when these steps don’t make logically sense.



Yes when a company is doing poorly it can make since to cut jobs. Which makes this odd is the number of times we see reports of a company being said to not be performing as well as it used to and needs to have lay offs just to make it but at the same time top executives are getting huge pay checks and bonuses. If a company is doing so poorly one needs to fire a lot of people then on would think that a company is doing so poorly that the people at the top shouldn’t award themselves.



It’s a flaw in the economics of our corporations. Stockbrokers our happy about the short term fix but don’t bother to ask “Hey how is giving the CEO and President lots of money making this company profitable?” If they did then in a number of cases people will realize that these action aren’t always the best (both for health of the company but also the economy.) They could either use this freed up cash to either would lower the number of new people dumped into or labor market or the money will be used by the company for other things like put it in R & D, marketing or any other area that can will look for new markets or improve the ones they already are in.

The Fall Of the American Dollar…and it taking us down with it

Over the past few years the value of the American dollar has been falling when compared to other currency such as the Euro and the Canadian dollar. The devaluing of the buck has been so drastic that people are no longer looking at it the same way that they used to. Where the US dollar was once seeing as the most stable currency in the world people around the world are dropping the dollar in favor of what is now being seen as more safer currencies.



That’s right people are dropping the American Dollar faster then a hot potato!



China (one of America’s largest investors) has just released a statement that they are going to stop buying American debt.



South Korea is pulling away from the dollar



Saudi Arabia which currency was pegged with the US dollar has decided to break it’s currency away from the dollar.



OPEC is now not going to only use the American Dollar to price the value of oil but will now start using a basket of currencies.



Etc, etc, etc.



What does this all mean? Well that all depends on policies that the American government makes. If we keep running things the same way as we are doing right now we may in fact be heading for some really reeeeeeeeeeeeeeeeeeeaaaaaaaaaaaaaalllllllllllllllllllllllyyyyyyyyyyyy economically troubling times. More then the current recession that we are in (or heading into depending on your view) some fear of the level of the great depression.



But if we take policies that do more to stabilize our dollar we might be able avoid falling into anything that bad and return to be the world’s safest currency again.

Should Michigan have been worried about paying off debt or worry about jump starting its economy?

Last time I talked about the fact that it might not have been a smart ideal for the state of Michigan to have raised it sales tax since it could hurt small business in a time where that state should be doing what it can to boost its economy.



But looking at it the question “was raising taxes the right thing to do in Michigan” might not have really been the write one to ask. But giving the fact that Michigan is facing such economic troubles maybe the real focus shouldn’t have been worrying about the states debt at that time and instead worry about how it could get out the economic mess that it’s in.



I can understand the thinking of the governor when she stated that it would be hard to draw in businesses to Michigan if the state can’t take care of it’s own finances and I think it is very important to keep a balance budget. But giving that the state is facing near depression level unemployment, a large exodus of citizens, and a number of other issues there are more important things that the state could be focusing on, that would help solve these problems more directly.



At least of the time being I think Michigan should be taking more of a Keynesian approach. Similar to what Roosevelt did to get America out of the great depression Michigan and do things like starting public works projects. Fix the states high unemployment by putting people to work. Hire people to build (or fix) infraturctor, hire more teachers, etc.



There isn’t a need for anything premenate just enough to kick start the economy and when the economy stablizes (when the business sector in the state is well enough to hire most of the people getting a pay check from the publics works job) we can stop the programs.



I don’t know why people choice to take such a round about way to solve the problem when the more direct approch is often the best.

Was raising taxes the right thing to do in Michigan?

In case you don’t know the state of Michigan has been going through tough times recently. We have the second highest unemployment in the United States, in fact employment is near depression levels. We are in the top 3 states when it comes to people facing foreclosure on their homes. At the same time the state was hugely in debt.



The government of course have been making moves to try and get out of this mess, such as trying to lure in new business to fell the void lift from the fleeing auto industry.



Something that has been in the news recently is the fact that Michigan faced a shut down because the state’s house of reps had a long out battle of the best way to balance the state’s budget. Most of the Republicans wanted to cut programs and most of the Democrats wanted to raise taxes. During the end the state didn’t close and they came to an agreement to both raise taxes and cut programs (so we get the worst of both worlds).



The fact that Michiganers now have to pay more in taxes has many living in the state upset. Many small businesses fear a down turn on business because the sales tax has been extended to cover many services. Of course there are also people upset over the fact that they now have to pay more in income tax.



I honestly don’t care much about the people getting angry over their increased income taxes mainly because Michigan will still have some of the lowest income tax rate in the nation (I think we are around 36th). In some ways I think the raise in tax is really just the market correcting it self via increasing it’s revenue to cover it’s expenses.



But giving the fact that Michigan has such a low employment rate right now I am not sure if expanding sales tax to cover a number of services is really the smart thing to do at this time. Most jobs are created by small and middle-sized business and by expanding the sales tax on these business people will spend less on them, which would lead to a slow down (or even a shrinking) of their business.



If anything this is a time that the Michigan government should be looking at what it could do to increase business in it’s state. Instead of expanding the sales tax, maybe the government should have looked at ways that it could lower fees that small and medium sized businesses face. Thus lowering their cost, which would help the business already in the state of Michigan as well as maybe draw others, which would be good for the state’s economy.

Reaganonomic Healthcare

With the election season up and running there has been the standard talk from Republicans about Reaganomic tax cuts and some on the Democrats side wanting to push socialized healthcare. And of course both sides are in disagreement over these issues.



But the odd thing is that these two have a bit more in coming then people think. One of the key thinking behind Reaganonomics is the ideal that by cutting taxes the economy will get a boost by all the money people save from not giving to the government.



On the other side on one of the key points brought up from those who support the ideal of universal healthcare is that even though taxes will more then likely rise people will save much more money by the fact that they wouldn’t have to pay their health insurance bills. This in turn would boost the economy because people would have more money to spend on other things. Also American business will be more productive and can better compete with companies around the world by having lowered cost to run their business due to not having to pay employees healthcare.



Do you see the connection?



People supporting both ideal theorize that are economy will go up if we follow their ideal and for nearly the same reasons. If we have more money in our pockets we will spend more.



And this is where I am confused. How can a side that so strongly favor Reaganomics because they say it will be good for the economy by allowing us to keep more of our money not favor socialize healthcare, which would also be good for economy by letting us save money?



Is it the taxes? Are people so focused on the thought that taxes might go up a bit that they over look the fact that you will save much more money from not having to pay hundreds of dollars on your health insurance bill every month?



I think a big problem is branding. Many that support Reaganomics do so because they like the ideal of paying less money in taxes. They are also against the ideal of socialized healthcare because of two ideals. First the ideal of increased taxes and second many of these people lived through cold war and have them ingrained in them to reject anything thing that even slightly smells of socialism.



To get past both of these negatives I think people hoping to both boost the economy and making sure people in America are healthy through a universal healthcare system is to try and move away from the socialism brand and tie universal healthcare to something that those opposed to it like. And I think that is Reaganomics.



Instead of calling it Universal or Socialized brand it Reaganomic Healthcare and people on the right will jump for it.

A sales tax on the price of freedom

On October 2nd or so a few members Democratic of congress purposed a bill to raise taxes to help cover the cost of the war in Iraq. People on both sides of congress quickly shot down the bill, but if it did pass and you are of middle or lower income you would have had only to pay an extra 2%, but if you where wealthy you would have had to pay an extra 15%.

I know must of you reading this will feel a nice breeze of relief hearing that this bill didn’t become a law because nobody likes to pay taxes and even more so they don’t want to have to pay even more in taxes. But the truth is that economically this bill made some sense on two factors.

The first factor makes since for those who want to end the war in Iraq. At the moment unless you are or know someone fighting in the war then there isn’t really much of a direct price you pay for this war right now. But if this tax did come in to being you of course would be effected by this war and that of course would make more people think about it. People think harder about things they have to pay for if it’s free (or seems free) they we take any crap. Once a price tag is fix to it the very same goods we judge it and ask…“is it really worth it?” It very, very likely that some of the same people who support the war (and even those who don’t think about it) now that wouldn’t if they had to pay extra in taxes for it. and in all likelihood they while start to become vocal (or more vocal) about it and ask for the war to end.

The other factor doesn’t really matter if you are for or against this war but with the truth that hardly gets talked about. “How are we going to pay for this war?” Right now, we are getting deeply into more and more debt because of this war. IF we don’t want this country to fall to far into the hole and risk the chance of being stuck in the position to have to pay billions of dollars to other countries just to pay off our nations credit card bill in the future we need to be a bit more fiscally balanced. When it comes to this war we really need to start to PAY FOR AS MUCH AS WE CAN NOW INSTEAD OF LATER.

Now I don’t know if this ideal would be the best way but at least it would cover are bill now instead of having us (and maybe even are children and grandkids) pay for it in the future. If we don’t go with a tax but still fill we need to pay for the war instead of getting in debt because of it, we could go with things like war bonds. Besides we could use new cartoons that slip in war bond jokes that kids today would understand (Bugs Bunny your nation needs you right now.)

is it odd of me that I think woman that can talk about business and economics are extremely sexy?

and if you are one of these woman call me so we can go out and talk a little econ over dinner.

I think the invisible hand of the market just groped me.

No really I just felt someone grab my butt! freaking prevy free market

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welcome

hello and welcome to the world of economics.

or at least my view on things