History has demonstrated that the most notable winners
usually encountered heartbreaking obstacles
before they triumphed.
They won because
they refused to become discouraged by their defeats.
B. C. Forbes
Factoid of the Day
Oil production in the Marcellus shale will soon surpass the Arab nation of Qatar (at 770,000 barrels a day). And the Wall Street Journal reported the U.S. will be in a near tie with Saudi Arabia (daily production of 11.6 million barrels of oil) as the world's largest petroleum producer by the end of this year… The U.S. is expected to become the world's largest oil producer by 2020. - investment daily newsletterAmong other things, America's energy production resurgence (no thanks to the Obama Administration, which has thrown your grandchildren's tax receipts at Big Green Energy boondoggles) provides competitively priced and readily available energy supplies available for domestic plants (Do you think the Obama Administration will finally do something about globally noncompetitive business tax brackets? Don't you think those economic illiterates would have figured out years ago into a jobless recovery that they needed a paradigm shift: the global economy does not revolve around the US and the US has to prove its worthiness to global investors. I'm not holding my breath.) Mark Perry's Carpe Diem blog routinely covers stories on the shale oil and gas revolution.
My Former Congressman Returns to the Senate
Mark Kirk is one of the few politicians I genuinely admire. I give VP Joe Biden props for welcoming the senator back to work. According to the Daily Herald (my edits):
On Thursday, all eyes will be on Kirk as he climbs the 45 steps of the U.S. Capitol steps at 11:30 a.m. without the aid of a handrail. Kirk's stroke — caused by a blocked artery — occurred on the right side of his brain, which affects movement on his left side. His left side has suffered partial paralysis, causing him to use a four-pronged cane. He has regained little use of his left arm, and is blind in one quadrant of his left eye. Dr. Richard Fessler, who operated on Kirk, said the senator was fortunate the stroke did not occur on the left side, which deals with cognitive abilities to speak, understand and think
For Mark Kirk, there was no white light, no tunnel. What Illinois' junior U.S. senator experienced was three angels standing at the foot of his bed. "You want to come with us?" Kirk was asked. "No," he told them. "I'll hold off."
"I would say that I definitely became much more religious," Kirk said. "They say there are no atheists in foxholes, and this stroke put me into a very deep foxhole. Yet, that feeling of faith sustained me, so I have no feelings of anger or regret."
Remember That Scene From "It's a Wonderful Life"?
S&L manager George Bailey's Uncle Bill, out to deposit thousands at the bank, accidentally folds a newspaper, covering nephew Harry Bailey's wartime heroics, around the deposit envelope and rubs it in evil magnate Potter's face, leaving the paper--and forgotten deposit--with Potter. (The lost deposit triggers the plot-centered crisis as George, suspected of stealing the money, faces scandal and possible criminal charges.)
This story focuses on a highly ethical teen whom came across a store's lost daily deposit and turned it in to the police.
Capital Gains: Counterproductive Tax Policy
Among other things under the new tax regimen, dividends and capital gains will be taxed more, and there will be a new Medicare surtax on relevant unearned income for higher income earners. Chris Edwards writes a good op-ed piece where he explains why high investment taxes are bad economic policy; green-eyed (i.e., Politics of Envy) Presidents and Senators are cutting off their noses to spite their faces.
First of all, short of dire financial need, investors can pick and choose when to sell their property (i.e., realize capital gains). Raising capital gains taxes raises the cost of investing and you get less of it. That shrinks the pool of investment dollars backing promising but risky business ideas. High taxes make lower-risk alternatives, say, tax-free municipal bonds, more attractive. Then there's the question of fairness; a stock price reflects an assessment of future earnings. Government is hitting the same revenue source twice. (A related argument can be made about dividends.) This blog opposes the double taxation in current tax policy.
A second fairness argument involves prices: the computation of capital gains is on NOMINAL (price-level) changes. For the most part, before the Fed Reserve century, the commodity-backed dollar was stable. Fed policies have watered down the purchasing power of the dollar, and when a long-term asset is sold, it's being purchased with cheaper dollars. This overestimates the real gain. In fact, if the asset is sold below inflation adjustments, it reflects phantom income, a "real" loss in value.
Musical Interlude: My Favorite Groups
The Carpenters, "Calling Occupants Of Interplanetary Craft". Remember (the original song artist) Klaatu and the (false) rumors it was a pseudonym for a secret Beatles project?
