E = P2: THE ECONOMY = SQUARE OF PURCHASE POWER

E = P2: I know this is simplified and approximate, but even this simplification is as Nobel Price winner Krugman put it beyond the intellectual flexibility of Congress, I would have called it capacity rather than flexibility.
--- Enough of the whining, lets come up with a solution and your contribution is needed. Before I go there in my Second Opinion, let me put you in the proper mind set.
--- The Supreme Court gave the finger to big tobacco by rejecting their argument that state law is pre-empted by federal law. Looks like big tobacco didnt pay enough to Sensenbrenner.
Notwithstanding, I urge you guys to read the news. If you do you will find reports that smoking causes cancer of your ovaries.
Now, if you allow me, let me give you my second opinion to the issue of economy.
--- E = P2 teaches us a number of things, FIRST: your purchase of a product or service triggers the purchase power of the next individual and so on down the chain. Next, the formula is global. Your purchase of a foreign product transfers purchase power at least in part to a foreign nation. Think of foreign car makers operating in the U.S. that transfer their profits to their foreign parent. --- Any lay-off diminishes the purchasing power and is therefore a no-no in a recession. I said that before. --- Next: the implementation of remedies to a recession is time-sensitive. The longer we wait, the worse it gets. Paul Krugman, the 2008 Nobel Price Winner has accused the German Government of boneheadedness because of its inaction. In other words, Krugman agrees with me: time is of the essence.
What applies to Europe applies to the United States. The addiction of the Hoover/Shelby crowd that is to follow Herbert Hoovers failed do nothing approach will have severe consequences in 2009.
--- There is one item, though, that Barack Obama needs to address not in 2009 but NOW: Come up with a clearly defined program. Three names and no program is not enough. He must come up with an Ideology the world can adopt as their own and follow.
Here are some ideas about a recovery program: A: The infrastructure idea seems ok to me but requires more. B: Change of the Patent Law, declaring a patent invalid if it is used to restrain the trade by a patent troll, f.e. Chevron, is imperative. C : Bridge-Loans to U.S. car makers for the purpose of retooling to convert to electrified cars is next. Retooling is not that expensive as I have shown earlier. And no, Hybrid Hummers are not the solution. D: We need a massive program that addresses innovation. Innovation is the key to prosperity as Bill Clinton has shown. Though it should be better managed. E: The Israel/Palestine conflict must be resolved once and for all. --- If you have a point you want to contribute, feel free to make a comment. Team brains work better than a solo. --- Oh, before I go, you may remember yesterdays analysis, that is the strange opposition by Republicans to AG nominee Eric Holder, questioning his qualification. Looks he is quite qualified. He made over 2 million at the law firm he works for this year alone. That is about twice the average his partners made. --- Last: According to AP an Australian Court approved service of legal documents via face book. In the case here, a notice of foreclosure was served via the social network.

Category:

News & Politics

Tags:

• ECONOMY
• PURCHASE
• POWER
• UNEMPLOYMENT
• FACEBOOK
• BARACK
• OBAMA
• PAUL
• KRUGMAN
• BAILOUT
• AUTO
• MAKERS

[thoughtchallenge]

The problem with the bridge loans is that they do not address the immediate need for car sales. This leaves car salesmen, truck drivers, suppliers and all of the restaurants and others in the chain out of work. What good does it do to save the industry for next year, if next year things are worst. I envision a consumers up approach. My plan would involve industry wide tax incentives, rebates, or guaranteed loans to consumers purchasing vehicles.

[bvongrabe]

Very good point. However, just because the bridge loans to car makers do not address the need of other sectors that would not be a cause to let car makers go out of business to boot. As I said, we need a comprehensive plan that goes beyond car manufacturers in addition to car makers "bailouts" (I hate that word). Killing car makers and making 2.5 miilion more unemployed will get us far beyond the 1930 depression.

[LastReplaySC]

Mr.+200 points Program, 3 Names and not even hot air...(stocks rose 200 after falling 700)

The "patent law" is crucial for all future "transportation" & "energy" programs and means a earlier Global transition time.

[bvongrabe]

The patent law is intended to protect the inventor and give him a chance. It is not intended to cover inventions that are NOT being used and serve only to restrain the trade and keep a nation dependent on foreigners who are hostile to the U.S.

[giroguy22]

wouldnt the infrastructure plan greatly increase an already mammoth national debt and decrease the value of the dollar even further?

[bvongrabe]

This is a good point. There are two options: an increase in debt or a deep depression for years to come, with countless personal tragedies. As to the dollar, China is manipulating the value of its currence, I am sure we could find a remedy, too. I will look into the extent of the problem.

[warrencurrier]

Let me repeat more clearly:

"We need to look at what has already been invented, and ask ourselves WHY such advances are NOT available in the marketplace today."

Do we really want to wake up one day a realize that the Japanese and the Chinese have delivered to our shores a car, well-built, attractive and affordable which runs on HHO on demand? (ie tap water)

Given the current state of affairs in USA -- such a day will soon be upon us.

[warrencurrier]

continued from below:

The profit motive will be enough for some other people and/or companies to invent a battery which is even more advanced than the patents Chevron bought.

Today we need to be looking a bio-fuels and hydrogen fuel cells in relationship to how the government will 'manage' them.

Both of these fuel supplies can be controlled by large vested interests (think: Oil Companies and Government)

We need to look at was already invented and ask ourselves WHY it is not available today.

[warrencurrier]

Sir,

Innovation IS the most important thing, but to think Government 'manage' the innovations... that scares me.

To your point about Chevron:

Yes, they purchased certain advanced battery technology that 'should be' in the marketplace for us all to enjoy.

But, Chevron has a huge stake in our NOT having a new way to propel our vehicles.

My point: I for one am not interested in the Government managing innovation.

The Government needs to get out of the way...

allowing for innovation.

[warrencurrier]

"thoughtchallenge'"

Regarding your comments on buying US-made cars:

Why would I want to buy something just because I can, with or without the addition of a loan guarantee?

The 'sale' of something (anything) is best driven by the buyer's desire to own (which is in a large part demonstrated by his/her ability to save money toward such a purchase) the good produced.

For example:

Right now, I want to own a black S63 Mercedes. So what do I do?

By 2012, I'll save $100k to buy a 2009 model.

[dave777blaster]

hahah guys cancer your ovaries.

Obama' s job program will be building the NASCO Super Highway

[thoughtchallenge]

If you would consider what could be done with the money. $30 billion divided by 15 million cars sold in a good year. That is the total number of vehicles sold in the U.S. What you end up with is $2000 per vehicle. If you give consumers this money for the purchase of a car, then I am sure 15 million cars would be sold. Sell the cars and you put everyone back in business. Salesman can sell, truckers can truck and so on. No increase in unemployment, no picking winners and losers.

[thoughtchallenge]

giroguy22- The infrastructure plan is basically the application of Keynesian economics. Keynesian economics revolves around the idea of government investment in infrastructure during recessions(in order to increase consumer purchsing power)and contracting of such expenditures during recovery periods. Obama's plan is to move forward infrastructure programs already on the books. He has yet to announce new plans. The real challenge will be controlling spending once the recovery has taken place.

[garthggarth]

If oil dependence is a matter of national security (and it should be), then innovative patents that could help us should be required to be developed, and developed FAST. Certainly, any company which receives aid or loans from the government should be required to sell or lease those patents they hold to someone who will utilize 'em. LastREplaySC, I found Chimerica to be interesting, TY. Funy how Republicans only talk about Conservative spending when thier 'contractors' in Iraq failed so bad.