http://finance.yahoo.com/news/Compa...tml?x=0&sec=topStories&pos=main&asset=&ccode= Companies and businesses are not hiring. We need to reduce the burden for business and at least not increase it in the form of increased regulations and taxation.
Obviously these companies and businesses have never actually run a business, as you have told us many times, companies and businesses need to invest in more capacity in times of of slack demand.
When the looming clouds of regulation and taxation hover overhead, most business will wait. Why don't we regulate and tax them more...that causes hiring right???
Obviously this looming hovering cloud has never actually run a business in its life. It just sits up in the ****ing sky, threatening to rain. Loooming and hovering like a ******* lazy b*stard. Get up and run a business for a change.
My parents have a small business that they have successfully run for 35 years. They AND their business have perfect credit, they have never even been late on a loan payment, and have absolutely never defaulted. Banks won't lend to them right now. Actually, they WILL lend to them, but the terms of the loans make it not worth actually taking a loan to expand/invest/continue in their business. Banks with hoards of cash, that received Billions in TARP money, are continuing to hoard cash and are making it extremely difficult for business loans. The line from the banks is: we have to have hoards of cash now. We got scared ****less during the credit crisis by a few bad players in New York. Also, with the political uncertainty...blah blah blah. So my parents are operating on cash flow only, with very little loan money. They certainly aren't operating at capacity if they had some freed up credit. We're not talking 100% loans at 0 interest that they are looking for. They'd take loans that they used to get in the 90s before people started throwing crazy loans around. It is probably costing about 40-60 jobs right now...as in if they could operate and demand capacity by having some decent business loans be available, about 40-60 more people in Houston would be working.
Businesses do what's profitable for them. They had to make cuts because of the economy and it seems like they've said "Hey, that raised out profits... why should we hire people back?" It has absolutely nothing to do with regulations and taxes and everything to do with what's most profitable to them: squeezing everything they can out of fewer employees, happiness be damned. Lack of regulations leads to something worse: a recession. Corporate greed knows no bounds and they must be watched before they destroy the entire economy just to make a few extra bucks for themselves. Oh wait, they already did that.
This hasn't worked for 30 years now. Here's some simple logic: Businesses have been given billions of dollars over the past few years - yet they're still not hiring and those billions of dollars don't appear to be bettering the economy. If those billions of dollars had gone to average people then all that money would have gone back into the economy almost immediately because people would have needed to spend that money on necessities, paying back debts, and so forth. The top-down approach has always been bull**** - but stalwarts refuse to believe it - even in the face of overwhelming evidence.
Obviously the overwhelming evidence has never actually run a business - you can just tell. It just sits there, all fact-y and figure-y and data-ish. It doesn't run anything. Incredible.
My company and others I know are in the same situation. TARP was a necessary evil, but I believe the vilification of business and banks and political grandstanding by the Obama administration about executive compensation etc. forced banks to pay back TARP before they were financially strong enough to do so. Bank Exec's want their big salaries and hunting trips and that is a fact of life. When these guys saw what Obama was saying about the restrictions going to be placed on bailed out banks, they found a way to pay it back quickly. The problem though, was that they don't have the liquidity and capital position to loan to the public. Citi and the like didn't even have the money but issued new shares (screwing older shareholders) to pay back TARP. We should have let the banks keep their strength by keeping them well capitalized without government intervention in their business. That would have increased flows and lending to businesses. It pisses me off to have bailed out banks that couldn't properly manage their risk getting government money and their execs making huge paydays. But more important than our emotions is liquidity to businesses in this country and Obama's threats against these institutions adversely affected our economy.
Couldn't agree more. The "trickle-down effect" just doesn't happen. Never has, never will. Businesses tend to do what's best for them, and what's best for them is rarely (if ever) best for their employees. It seems to me that capitalism is great for a developing nation, but once the nation is well developed, it just turns into pure greed.
We have one of the highest per capita incomes in the world. Our financial markets (DJIA) has gone from the 800's to the 10,000's and are THE dominant global force. People are fighting to get into the USA and not to get out. How has this not worked? Too much leverage came into the system in the last few years and the asset backed security markets blew up by a real estate bubble, but how has this not worked?
Obviously your company has never actually run a business. Instead your company just sits there, offering goods and services in exchange for currency. If it actually built a business, a la Charlie Munger, maybe your company would be somebody I would listen to.
Banks paid that money back because they were paying very high rates of interest on that borrowed money. They couldn't have made those returns loaning it to customers, so it was a financially smarter decision to pay it back.
Recessions are a needed part to any economy as a good idea becomes overdone and the result is a slowdown. They are needed routinely to burn off the old brush. Regulations are always backwards looking and never curtail the next crisis as when there is growth there are slowdowns as that growth occurs too fast. Did Sarbanes Oxley or Mark to Market curtail this recession? Nope.
Governmental policies in a political move pushed them to pay it back before they were financially strong enough to. This resulted in a weak capital base and a greater inability to lend money. This is on the shoulders of the Obama administration. Their anti-business sentiment is consistent.
Uh... banks were well capitalized BECAUSE of government intervention. I think you're in favor of government intervention, Republican style: privatize the gains, socialize the losses. This is the best you've got? Faulting the president for talking tough on an issue you AGREE on?
Over the past 20 years, incomes for the richest of the rich are up astronomically. Meanwhile, the median income in America has dropped. The rich are certainly doing well, as evidenced by the performance of their savings plan (DJIA), but the rest of the country, not so much. Trickle down economics is where the government redistributes income from the lower and middle class to the rich and then the rich stand over us and piss.
