Herr Trump and the Last Hurrah of White America

The United States of America is leaning dangerously towards the right wing as Donald Trump leads the Republican nomination for the presidency on a platform of ultra-right racism, fiscal irresponsibility and vague promises to "make America great again" - which is reusing Ronald Reagan's campaign slogan of "make America great".

Americans should be advised of the following things:

Donald Trump bankrupted multiple businesses, including a casino. How fiscally bad do you have to be to bankrupt a casino?

Donald Trump was born into wealth. He didn't become wealthy using business acumen, he is the result of his family's previous wealth and his own skill at swindling people out of their money - hence numerous lawsuits and allegations of fraud.

Donald Trump has been accused of defrauding Americans many times, but never convicted. That means he isn't just good at defrauding people, he is very good at getting away with it.

Donald Trump will say anything to win - including bashing Mexicans and Muslims in an effort to prop himself up with racist voters. Hey, it worked for Hitler, why not for Trump?

History shows us that Trump is a devout capitalist, interested only in himself and making himself richer. He has zero interest in helping the American people. Much more likely he will bankrupt the USA and sell much of it to China. Or Saudi Arabia.

Many of Trump's biggest financial supporters are from Saudi Arabia - just like the Bush family and Ronald Reagan. This sets an almost foregone conclusion that Trump actually has a chance to win the presidency. If the same people who backed the Bush family and Ronald Reagan into the White House could get those idiots into power, they could certainly get Trump into power too.

Which is bizarre when you consider the people who are supporting Trump in the USA - people who evidently don't know Trump is both proposing banning Muslims but is also receiving huge campaign donations from Muslims - are mostly white and mostly male, and uneducated.

So uneducated it even spawned a fake internet quote.

Fake or not, it doesn't matter. It raises a very valid point about the average intelligence of Republican voters in the USA. They're not just uneducated and stupid, they're downright ridiculously stupid.

And Donald Trump, a self professed genius, is playing right to the heart of Republican voters. He isn't talking about economics (or when he does, he basically just brags about the fact he is a billionaire) or the US national debt, slumping quality of education, household debt, poverty in America, the quality of health care in America or anything worth actually talking about, and instead he refocuses attention on how much he would bomb Muslims, how he would ban Muslims from the USA, promote hatred of Mexicans, force Mexico to build a wall across the border (there is already a fence, what more does he want?), and basically make meaningless platitudes and BS his way through debates.

And Republicans, those who can't even platitudes or know what the word means, eat it up like it is sugar-covered-sh*t and then think it is chocolate.

If elected - and it is looking more and more possible - Donald Trump will be the biggest loser in American politics. The most laughed at. The most powerless. The lamest of lamest ducks.

Why?

Because even Republicans, dumb as they are, will eventually realized when they have been swindled.

For fun have a look at George W. Bush's approval rating during his time in office. He left office with an approval rating of 33%, the lowest approval rating of any president in the history of the USA. Donald Trump can do one better. He can get an approval rating in the 20s or lower.

Now in the title you may have noticed we added the bit "the Last Hurrah of White America".

We chose this title because racism is fighting a losing battle in the USA. It is a matter of demographics and population growth. White people are currently in the majority in the USA, but during the next 45 years white people will lose that position of dominance and start the process of becoming a minority.

There are two main racial groups in the USA that are growing rapidly: Hispanics (not just from Mexico, but also Central and South America) and people who are mixed race - which is one of the reasons why the percentage of African Americans is not expected to increase, due to mixed race marriages/children - a phenomenon that is rapidly growing in the USA.

At present the best estimate is that white Americans will officially become a minority by 2044.

And let us be honest about this. The idea that white people (some of which are descended from former slave owners) might become a minority in a country that was once dominated by a hundred million Cherokee, Sioux and other "Amerindians" before white people showed up and started a mass genocide that wiped much of their culture away... Well that just freaks the hell out of white Republicans.

To them they think that they might see a return of slavery, but it would be white people who are the slaves. Or that the other races will band together to kill all the white people, just like white people did to Indigenous Americans (aka "Amerindians"). Utter nonsense, but that is what some white people think will happen.

So Donald Trump represents to white Republicans a sense of "hope" for the future, to help white people stave off the hordes of scary Mexicans and Muslims and other "brown people" that white Americans find so scary.

Ultimately the USA was a country born amidst racist genocide, endured over a century of racist slavery, struggled for over a century with racial divides of wealth, income, social status - and continues to struggle even now, despite electing a black president.

Racism is alive and well in the USA, and it is showing its ugly head in the form of Donald Trump.

DONALD TRUMP

MAKE AMERICA WHITE AGAIN

Farmers still getting the short end of the stick

Between droughts and governmental lack of concern over agriculture, farmers are still getting the short end of the stick.

Consider this: As of 2011 over 81% of the American population is urban (meaning they live in cities or towns). Less than 19% of Americans still live on farms or in rural regions. In Canada it is also 81%.

So from a political standpoint who are you going to show favouritism to more? City-Slickers or Farmers? The answer is obviously cities.

Farming is one of the most difficult, and yet most important, careers available, but it is horribly underpaid and there is very little government support for it. Many farmers now work second jobs just to make ends meet because farming by itself doesn't bring in the necessary money to raise a family.

Often just to try and get ahead in life farmers borrow large sums for machinery and equipment, which means they are either borrowing from the government or banks, and if there is a drought or bad weather for several years in a row its pretty much guaranteed the farmers will lose their farms and their homes because of inability to pay back loans.

Let us take for example one piece of machinery commonly used by cattle farmers: Livestock scales are used to weight cattle before or during auction. It is an approx. $1,000 investment to get scales, but the idea is so you can fatten up your cattle to the right size, then send to auction to fetch a good price. Its basically a necessity if you're a cattle or pig farmer.

Now you might think, oh, but how could a drought effect cattle or pig farmers? Well, two ways:

1. Cattle can die from something called "Heat Stress". It is basically heat exhaustion. For pigs they also get Heat Stroke (and sunburns). Preventing Heat Stress means providing shade, improved ventilation and a sufficient quantity of water... which adds up to extra costs and equipment.

2. More droughts = Less food to feed the cattle. If the farm in question grows their own food for the cattle and they aren't growing enough due to a drought, they have to buy extra food for the cattle from other farmers. If there is a huge shortage due to the drought the food has to be shipped even further and will cost a lot more. The prices can end up bankrupting the farmers.

Next lets look at the case of Utah... which as of September 2012 has had all 29 counties declared "drought disaster areas". River beds and groundwater ditches have all dried up.

It is all one big dusty mess.

Since October 2011, only 17.2 inches of rain has fallen on northern Sanpete County in Utah, according to the U.S. Department of Agriculture. That is just over half of the previous year's rainfall of 32.5 inches (which was also a poor year for rainfall in Utah).

While many farmers throughout Utah have fallen back on water storage and reservoirs, the farmers in the Sanpete Valley have little to no water storage available. They simply don't have facilities available to store water and then use it for their crops and livestock. The natural springs and runoff from the mountains in Utah that usually supply the region's rivers fell short this year after last winter's meagre snows and early spring snow melt.

Some farmers have multiple basins which they used to use to store water, basically ponds where their livestock could drink. But the ground of those ponds are now cracked and chalky, completely dried up.

It hurts all the farmers too. Utah's wheat production has dropped to 30% of what a normal season would yield. Hay is also down 50%. Many families will be short 50% to 70% of their yearly income because of the drought.

Cattle in the region sell for considerably less since they weigh between 100 and 150 pounds less on the livestock scales than they would have if the family could wait a month to sell them. But they can't wait. They need money for food, to pay the bills, to keep the banks off their backs. They could be making more off the sale if they just had the extra time, but times are tough and when the bank freezes your credit cards you have to sell what you can at dirt cheap prices just to get the banks to unfreeze your credit cards.

The end result is that farmers need machinery like tractors, combines and even livestock scales in order to make a living. And they can't get those things without getting a loan. Every penny counts.

And with global warming and more drought on the horizon farmers aren't getting any help from government buck-passers who blame other levels of government and refuse to help farmers when they're in bed with the banks.

Children's Toys for Xmas 2012

Let the Battle of the Toymakers begin!

Seriously, its like gladiators duking it out in a victory or death competition.

Lets go down the list of "hot buys for 2012" shall we?

#1. iPad Mini / Tablets for Kids

If you have small children you should already be aware that giving electronics to children under the age of 9 is basically just guaranteeing that said electronic will BREAK within the first month. I've seen it happen. Little kids are careless. They don't realize how easily these things break and manufacturers seem to be making devices that break easily, thus guaranteeing that you either have to come back and buy another one... or give up completely.

My advice? Don't trust an 8 year old or younger with anything electronic. If you can't trust the kid not to pull a cat's tail (another thing I've seen little kids do regularly), then you definitely cannot trust them with electronics.


Now I admit, some parents out there just love to spoil their kids. They believe it is their god-given-right to spend and spoil their kids as they see fit. But all I am saying is HAVE FUN with the replacement bills when the electronics gets wet, smashed or otherwise broken. Or lost. Misplaced at school. Left on a park bench. Dropped on the subway. You name it, kids will do it.

What is a smarter buy is VTech InnoTab 2 and LeapFrog LeapPad 2. They're educational tablets that are made to be more durable. A much smarter buy than buying an iPad Mini.

NOTE: If you do decide to get an iPad Mini for xmas, remember to get protective stuff for it. eg. Screen shields and a protective case. Your kids will probably still manage to break it eventually (or lose it, get it stolen, etc), but at least it won't be for lack of trying on your part. If you can't trust your kid to feed a puppy, walk ait and not lose it somehow, you probably can't trust them not to set down their gadget in a toystore and promptly forget about it.

#2. The 2012 Furby reboot

After being gone for over a decade this idiotic stuffed toy is back and ready to be a hot selling item. Updated from the original version, this Furby 2.0 has an app connection, softer fur to hide touch sensors and more realistic expressions. The eyes have been completely changed to backlit LCD screens in order to allow the Furby to better look around the room and respond to noises.

#3. My Little Mousie

This company understands that kids are inherently rough on their toys. I have several stuffed animals in a box in my parents' attic which can testify to the abuse children put their toys through. This Premium German sigikid Baby Toys for Canada. The company in question, which you can visit at http://www.mylittlemousie.ca/, sells everything from high durability backpacks, stuffed animals, old fashioned wooden toys, rattles and even toys for nurseries. Its really marketing at the 0 to 2 years old market, but it is certainly a market that is unexploited thus far. See the company quote below:

"Children develop a deep relationship with their toys. They are a child's first love. That's why at My Little Mousie, we believe in high-quality toys that are built to last, well-designed and functional. We specialize in hard-to-find German premium toys. Right now, we offer a unique collection of sigikid products. We offer a unique collection of German premium sigikid baby toys. My Little Mousie is a Vancouver based boutique online store for Canada."

#4. Eco Toys

I actually think this will be a dud.

The tree-huggers (or those people trying to appease them) are pushing green garbage trucks made of plastic. What kids wants a garbage truck for xmas? Get real people.

Want to give the boy (I presume it is a little boy if you're buying them a truck) something they will actually like? Buy a whole collection of Hot Wheels cars. They're classics and always popular. Some of them change colour in water or heat, can be used on a track (like a roller coaster), etc.

Or find one that has a wind-up function. One of my favourite cars when I was that age was a wind-up car that you pulled back two or three times, set it down and then pressed the button on the back and it zoomed off. No batteries required. And it still works even today.


#5. Web Shooting Motorized Spider Man

Say what? Actual webs?

No, not actual webs. Just a piece of white plastic and it doesn't go that far. Still, it will probably sell.









#6. Nintendo 3DS XL

I have a friend who bought her 7-year-old one of these. He broke it in the first month. So she got him another one, but this time she got it second-hand... and he broke it too.

Seriously. You're just throwing your money away on these electronics.









#7. LEGO

Seriously, boys or girls, get them Lego. Doesn't break easily. Hours of fun. A classic toy. Get them a Lego train set with a wind-up motor.

#8.MORE LEGO

Seriously, you can never have too much Lego. (Unless you step on a Lego brick on the stairs with your bare feet...)

My parents once split up the shopping and they both accidentally got me the exact same Lego spaceship. I thought it was the most awesome thing ever that I had TWO of the same spaceship. (Seriously, one for each hand...) They thought they had goofed and even wanted to return and exchange one of the boxes, but I gleefully ripped them both open and started building.

Seriously, best xmas ever. :)

Facebook's share prices crashing

Facebook Incorporated director Peter Thiel has sold most of his stake in Facebook (the world’s largest social-networking website in case you didn't know that already). Facebook had banned insider sales, but the time restriction for that has ended and Peter decided to sell his $395.8 million in stocks and run with the cash. Overall he has made over $1 billion selling off his shares since Facebook's IPO.

Why? Because Peter Thiel was one of Facebook’s earliest investors and knows when the golden goose is about to die. So why not collect his cash and leave before it becomes "officially dead". Thiel sold about 20.1 million shares in the company on August 16th and August 17th.

He started with an original investment of $500,000 in 2004, so in reality Thiel has made a bundle off being a long time investor in the company. In 8 years he turned that $500,000 into over $1,000,000,000. Not bad for being patient and knowing when to sell at the right time.

Meanwhile other investors in Facebook are now losing their shirts. The stock has lost almost half its value since the IPO amid signs are growing that Facebook’s growth is slowing, leveling out and "profit expectations" are much lower than pundits were claiming. In short the company's value was largely on paper and many insiders are now dumping their stakes.

Facebook last week unlocked 271.1 million shares, the first of five insider-sale restrictions scheduled during the company’s first year as a public company. Another 1.44 billion shares will be freed up through November, but by then prices could be a fraction of what the IPO was.

Right now (as I finish this post) the price is down to $19.48 and dropped 10 cents in the last minute.

How to Destroy your Company's Reputation and its Profits

There are many ways to destroy a company from the inside.

1. One way is to overspend on advertising.
2. Another way is to package the product improperly so it ruins the product.
3. A third way is to take on debts that you can't possibly repay.
eg. Disgraced brewer 'Steelback Brewery' did all three of these thanks to its incompetent and shamelessly self-promoting CEO and drove the company into the ground in 2007.
4. Another way is to not evolve with the times and changing technology and then fall into debt and eventually bankruptcy. eg. Nortel Telecom.
5. Another way is to make faulty investments in real estate and other things (and in some cases running a Ponzi scheme) and then try to get a bailout from the federal government.

For fun check out the list of the biggest failed banks on Wikipedia:

http://en.wikipedia.org/wiki/List_of_largest_U.S._bank_failures

Note that they're losses were in the billions. $307 billion for the Washington Mutual in 2008.

Lastly another way to destroy a company is to slowly, piece by piece, destroy a company's quality and reputation. This is what now known as the "the Schlitz mistake" and you can read all about it in the article we've attached below:

The Fall of Schlitz: How Milwaukee's Famous Beer Became Infamous

By Martyn Cornell

You might think it would be good to have your company held up in business schools as a famous example. But that wouldn't be the way the people behind the Schlitz brand feel about it. Because Schlitz is held up as a dreadful warning of how not to do it.

Indeed, the company that now owns Schlitz, once "the beer that made Milwaukee famous," is currently telling drinkers that "our classic 1960's formula is back," the sub-text being that it "now tastes the way it did before we started disastrously mucking about with it 40 years ago, ruining the beer and wrecking the company along the way."

Schlitz's roots were in a Milwaukee restaurant started by 34-year-old August Krug, an immigrant from Bavaria, in 1848. Two years later Krug hired Joseph Schlitz, another German immigrant, from Mainz, to be his bookkeeper. When Krug died in 1856, Schlitz took over the management of the brewery, marrying Krug's widow Anna two years later and changing the name of the business to his own. That same year Krug's 16-year-old nephew, August Uihlein, began working for the brewery. Over the next two decades the brewery grew to be one of the two or three biggest in Milwaukee. Then in 1875 Schlitz was drowned after the ship in which he was travelling on a voyage back to Germany struck rocks off the Scilly Isles. Control of the brewery was inherited by August Uihlein and his three brothers, who had joined him in the business.

The brewery prospered considerably under the Uihleins, springing back after Prohibition, and late in the 1940’s Schlitz became the best-selling brew in the United States – the Wisconsin brewer wrestling the title from Anheuser-Busch's Budweiser, the self-styled "King of Beers." The 1950’s saw a continuous assault from Anheuser-Busch to win back the crown of America's favorite. The two brewers swapped the lead between them until 1957, when Budweiser went ahead permanently. The decisions taken by Schlitz's owners, the Uihlein family, to cope with their rival's dominance would eventually "salami slice" their company to death.

By 1967 the company's president and chairman was August Uihlein's grandson, the polo-playing, 6-foot-4–inch-tall Harvard graduate Robert Uihlein Jr., then 51. Robert decided that if he could not sell more been than Anheuser-Busch, he would at least make his company more profitable than his St Louis rival. The first step in Uihlein's plan to save money was a new brewing method Schlitz called "accelerated batch fermentation," or ABF. This cut the brewing time for Schlitz beers from 25 to 21 days, and then from 20 to 15 days, compared to the 32 to 40 days of storage – or "lagering" – used for Budweiser.

The result was that Schlitz was now getting much more beer out of the same amount of plant, with all the boost in margins that meant. At the same time Uihlein instructed his brewers to begin cutting costs by using corn syrup to replace some of the malted barley used to make the beer, and by substituting cheaper hop pellets for fresh hops. The ingredient alterations were meant to be made incrementally, Uihlein's belief apparently being that drinkers would not notice each slight change to the product. Unfortunately, as commentators later pointed out, the steps from A to B and from B to C might have been tiny and unnoticeable, but the steps from A to M added up to a big leap.

At first all seemed to be working. In 1973 Schlitz was able to boast that it had the most efficient breweries in the world, and it was carrying out a rapid expansion of its production capacity. Its profits-to-sales ratio and its utilisation of its plant – in terms of capacity against actual production – were both substantially above the industry average. Market share was growing faster than at either of the other big two American brewers, Anheuser-Busch and Miller. Rivals tried to trip Schlitz up by claiming that its ABF brewing method meant it was selling "green," or too-young beer. Schlitz responded by changing the meaning of ABF from "accelerated batch fermentation" to "accurate balanced fermentation."

Uihlein had already been given a warning about what could happen if drinkers felt a brewer was messing about with beer quality, however. In 1964 Schlitz had acquired the Primo brewery in Hawaii. By 1971 Primo accounted for 70 per cent of all beer sold in Hawaii. Then Schlitz stopped full brewing at the Primo plant, instead shipping dehydrated wort from its brewery in Los Angeles for fermentation in Hawaii. Islanders said the taste of their favorite beer had been altered for the worse with the change, and Primo's market share dropped like a brick to just 20 percent in 1975. Schlitz started full brewing in Hawaii again that year, but sales of Primo never recovered to their previous high.

Back on the mainland, Schlitz had attempted to respond to the growing success of Miller Lite, the first successful low-calorie beer, with the launch late in 1976 of Schlitz Light. But perhaps because drinkers were already suspicious about what went into ordinary Schlitz, Schlitz Light was a failure in an otherwise expanding sector.

Meanwhile Schlitz was running into trouble with its mainstream brand, after an attempt to disguise to consumers what it was putting into its beer. Because it aged its beer less than other brewers, Schlitz had to add silica gel to the product to prevent a haze forming when it was chilled. In 1976 the company began to worry that the United States Food and Drug Administration would compel brewers to list all their ingredients on bottles and cans. Its use of silica gel would show up in harsh contrast to its rivals such as Anheuser-Busch, who aged their beers longer, allowing the protein to settle out naturally, and therefore did not need to use artificial anti-haze products. Anheuser-Busch was sure to point up Schlitz's use of an "unnatural" product in its beers and contrast this with the "all-natural" Budweiser.

Schlitz decided to use another beer stabilizer instead, one that would be filtered out of the final product and thus would not have to be listed as among the ingredients. Unfortunately, what Schlitz's brewing technicians did not know was that the new anti-haze agent, called Chill-garde, would react in the bottles and cans with the foam stabilizer they also used, to cause protein to settle out. At its best this protein looked liked tiny white flakes floating in the beer and at its worst it looked like mucus, or "snot," as one observer bluntly called it.

For months Schlitz kept quiet about the problem, with Uihlein arguing that the haze was not actually physically harmful to drinkers, and in any case not much of the beer would be kept at temperatures at which the haze would form. However, drinkers did complain, sales began to drop and Schlitz had to make a secret recall of 10 million bottles of beer, costing it $1.4 million.

Around the same time Robert Uihlein was diagnosed with leukaemia, dying just a few weeks later. An accountant, Eugene Peters, became the company's CEO, and a geologist, Daniel McKeithan, who was the divorced husband of a big Schlitz shareholder, was appointed chairman.

All Schlitz's problems with its image, caused by Robert Uihlein's tampering with the quality of the beer, were causing the company to start losing its second place in the American beer market to its Milwaukee rival, Miller. Even though Schlitz had increased its share of the U.S. beer market from 7 percent in 1950 to 14 percent in 1977, Budweiser and Miller had grown faster. Peters and McKeithan pushed Schlitz's marketing department to go for a new "high impact" advertising campaign featuring an aggressive-looking boxer who demanded, when asked to swap his Schlitz for another brand: "You want to take away my gusto?" Instead of amusing viewers, the ad put them off: Consumers found it "menacing," and it became known as the "drink Schlitz or I'll kill you" campaign.

By the end of 1977 Schlitz was on the slide, with profits, market share and capacity utilization dropping. Peters resigned after only 11 months and was replaced by Frank Sellinger, the former brewmaster at Anheuser-Busch. Sellinger returned to traditional brewing methods and improved the product. But Schlitz was now operating in the red, and by 1980 its sales had been passed by another Milwaukee rival, Pabst, with a third Wisconsin brewer, Heileman, not far behind.

The end came quickly. In June 1981 Schlitz closed its Milwaukee plant to try to solve what was now an overcapacity problem. In October of that year Heileman made a takeover offer for the still-struggling Schlitz, only for Pabst to put in a rival bid. Both bids were vetoed by the Justice Department on competition grounds, but in June 1982 the Justice Department allowed a $500 million bid by the Detroit brewer Stroh to go through. One analysis has estimated that the Schlitz brand lost more than 90 percent of its value between 1974 and that final year of independence.

However, the debt Stroh took on to pay for acquiring Schlitz was ultimately too much for the Detroit company to carry, and it collapsed in 1999. Ironically, in the fire sale that followed the Schlitz brand was acquired after all by Pabst.

The disastrous effect of deciding to reduce product quality salami slice by salami slice is now known in business circles as "the Schlitz mistake." It has been argued that Robert Uihlein's response to the increased competition from Anheuser-Busch and Miller – cutting costs to increase short-term profits – was a rational decision, and if there had been anything of a strategy of "management of decline" about it, then the complete collapse in shareholder value of the late 1970’s and early 1980’s might have been avoided.

It would have been realistic for Uihlein to conclude in 1970 that the medium to long-term future of the American brewing industry would be one where only two or three big brands would command the vast majority of sales. This is, after all, exactly what did happen, with Anheuser-Busch InBev, SAB Miller and MolsonCoors dominating the picture today. It would also have been realistic for Uihlein to conclude that, whatever Schlitz's position was in 1970, there was no guarantee it would end up as one of those surviving two or three beer giants, and it was better to go for maximum profits while allowing the company to run down gently.

However, what Uihlein tried to do was have his brewery cake and eat it too: cut costs, boost short-term profits and still maintain a long-term future for the company. The result was what the airline business calls a "controlled flight into terrain." Cost-cutting cost the company its reputation, something almost impossible to repair for a consumer goods maker, and it destroyed a concern that had once been the biggest in its field.

Why the Book Publishing Industry needs to Evolve

Book publishers are pricks. If you've ever tried to publish a book you know that publishers are basically sifting through their inbox of manuscripts and sending rejection letters back to authors claiming the book isn't suitable for whatever nonsense reason they can pick out of a jar. Wrong age group. Too much swearing in the book. They didn't like the plot. Yada yada yada.

However the problem these days is that authors are no longer forced to go via the traditional book publishing industry if they want to write and make a profit off their work.

eBook authors like fantasy author Charles Moffat and feminist writer Suzanne MacNevin are coming out with their own works via websites like Amazon Kindle, Barnes and Noble's Nook, Lulu.com and others. And eReaders are selling like hotcakes too. Chapter's Kobo is planning to allow self-publishing in the near future too because they've realized the potential of self-publishing.

NOTE: If you do buy a Kindle or Kobo however you will also need to buy a protective case and a screen shield to protect your new gadget from scratches and damage. After all who wants to read off a screen with a big scratch in the surface?

To better explain the woes of the publishing industry we'd like to now quote an article written by Jessica Park, an American writer who writes novels for women in the 18 to 25 age group (which apparently most publishing companies avoid for some silly reason).

How Amazon Saved My Life

By Jessica Park

I am an author.

I still can’t get used to that title, but I suppose after having written seven books–five of them traditionally published–that’s what you’d call me. The funny thing is that I feel more like a real author now that I self-publish than when I had the (supposed) support of a publisher behind me.

How did I end up on my own? It began when I couldn’t get my first YA book, Relatively Famous, published, despite getting stellar feedback from editors and nearly selling the film rights to a teen pop star. I was at a loss for what to do. I couldn’t keep writing books without selling them. What if the next thing I wrote flopped? I took a risk, in many ways, and wrote Flat-Out Love. It was the first book that completely came from my heart, and it was a book that ignored all the industry rules. I knew in the back of my head that I could self-publish it, but at the time it seemed like that would have been an admission of defeat.

I spent months thinking that I needed a big publisher in order to be a writer, to legitimately carry that “author” title. To validate me, and to validate Flat-Out Love. I needed a publisher to print my books and stick a silly publishing house emblem on the side of a hard copy. They were the only way to give my books mass distribution, and having them back me would mean that readers would know my book was good.

I also, apparently, thought that I needed to be taken advantage of, paid inexcusably poorly, and chained to idiotic pricing and covers that I had no control over.

I was, it seems, deluded.

It turns out that I was entirely wrong. I was missing what I really wanted. One of the major reasons that I write is to connect with readers, not publishers. The truth is that I couldn’t care less whether New York editors and publishers like me. I don’t want to write for them. I want to write for you. The other undeniable truth is that readers could care less that my books aren’t put out by a big publisher. They read for the content, not the publishing house emblem.

I have a lovely, smart, powerhouse agent, who tried to sell my next book, Flat-Out Love, to every major publishing house. She adored the story and thought it would sell. Fourteen editors turned it down, although each one said how strong the book was. But, editors seemingly didn’t give a crap about whether or not they liked the book. What they did pay attention to were their totally misguided ideas about what would and wouldn’t sell. I heard two things over and over again about my book. The first was that my story starred an eighteen-year-old college freshman, and that age was “categorically” too old for YA books and too young for adult books. It seems that one is not allowed to write about characters between the ages of eighteen and…what? Twenty-five? Because… because… Well, I’m not sure. The second thing I heard was that because my simultaneously-too-young-and-too-old heroine was not involved with anything slightly paranormal, the book wouldn’t sell.

Did I cry over some of these rejections? Absolutely. Did I feel inadequate, untalented, hurt? Yes. Did I doubt my ability to craft a story that readers could fall in love with? You bet.

And then one day I got yet another rejection letter and instead of blaming myself and my clear lack of creativity, I got angry. Really, really furious. It clicked for me that I was not the idiot here. Publishing houses were. The silly reasons that they gave me for why my book was useless made me see very clearly how completely out of touch these houses were with readers. I knew, I just knew, that I’d written a book with humor, heart, and meaning. I’d written something that had potential to connect with an audience. As much as I despise having to run around announcing how brilliant I supposedly am and whatnot, I also deeply believed in Flat-Out Love. I knew that editors were wrong.

And I finally understood that I wanted nothing to do with these people.

I snatched the book back from my agent and self-published it. With great relief, I should note. I could finally admit to myself that the only thing I had really wanted was to be told, “You’re good enough.” You know who gives me that? My readers. My generous, loving, wild readers.

Publishers pay terribly and infrequently. They are shockingly dumb when it comes to pricing, and if I see one more friend’s NY-pubbed ebook priced at $12.99, I’m going to scream. They do minimal marketing and leave the vast majority of work up to the author. Unless, of course, you are already a big name author. Then they fly you around the country for signings and treat you like the precious moneymaking gem that you are. The rest of us get next to nothing in terms of promotion. If your book takes off, they get the credit. If it tanks, you get the blame.

No, thank you. I’m all set with that.

You know who I do like, though? Amazon. Well, all online ebook sites that let me self-publish, but Amazon is the true powerhouse right now. Say what you want about this company, but it’s because of them that I can continue writing. It’s unclear to me how a big publisher thinks that I could live on their typical payouts, and why they think I should drop to my knees in gratitude for their deigning to even publish my book in the first place when I’ll do all the work myself. I’m not going to be grateful for that nonsense, but I am going to be grateful as hell to Amazon.

Bestselling trad-to-indie-author Barry Eisler, famous for turning down a six figure deal from St. Martins Press to go out on his own, took a lot of heat for having compared an author’s relationship with a big publisher to Stockholm syndrome. The truth is that it’s not a bad comparison at all. Snarky, funny, and exaggerated, perhaps, but there is more than one grain of truth there, and I just know that authors across the country were nodding so violently that we had collective whiplash. When writing for a publisher, you learn to be overly thankful for every pathetic little grain of positivity that comes your way. A disgustingly awful cover? Smile broadly and say how gorgeous it is. Contracts arrive months after arranged? Whip out your pen and sign with no complaints. You’re eating Ramen noodles while they are taking all of December and January off and while they essentially shutdown during the summer to vacation on the Cape? Slurp your soup and be happy.

Because of Amazon and other sites, I’m making enough money that I can continue writing. I’m averaging sales of 3,500 books a month, not including the month that Amazon featured Flat-Out Love in a list of books for $3.99 and under. That month I sold 45,000 Kindle copies, and sold over 10,000 the next month. Those numbers are insane to me. Absolutely insane. The fact that I continue to sell well a year after the book’s release is humbling. Yes, I wrote a book that has earned me excellent reviews, so I take credit for that, and I worked myself to death finding bloggers to review my book (God bless my loyal bloggers who took a chance on me!), but I have to credit Amazon with giving me such a strong platform with such overwhelming visibility. I can be a writer. I am a writer.

And it’s not just me. Self-published authors, many of whom are writing about college-age characters, are finding viable careers. Abbi Glines, Tammara Webber, Jamie McGuire, Tina Reber, AK Alexander, Angie Stanton, Stephanie Campbell, Colleen Hoover, Liz Reinhardt, and plenty more. I’m seeing more and more traditionally published authors walking away from the headaches and turning to self-publishing. It can be tricky to leave because very often an author needs the advance money in order to survive, and then gets stuck contracted for books that quite likely won’t earn out that advance or won’t ever provide much in terms of royalty checks. When authors break the cycle, get the hell out, and flourish on their own, it’s a wonderful thing.

Indie writers owe Amazon big time for what they’ve given us. Are they perfect? No. Do they make mistakes? Yep. And they’ll continue to make mistakes. But I promise you that traditional publishers never call up their authors and ask what they can do better. I nearly wet my author pants when I got a call from someone in the Kindle publishing department who wanted to know what publishing and promotional features I’d like to see. He wanted to know all about my experience with them, what I liked, what I didn’t like, and on and on. I was floored. Amazon messed up their sales reporting page not that long ago, and you know what they did? They sent a goddamn email out to their authors explaining what had happened! And then they fixed it! Do you think a big publisher would do that? No, they certainly would not.

But you know what these silly NY publishers are doing? Running around trying to buy now-successful self-published books. I know more than one author who is making $50-150,000 a month (yes, a month) who are getting the most stupidly low offers from big publishers to take over that author’s book. Why would my friends take a $250,000 advance (if even offered that much), take a puny royalty rate, see their sales hurt by higher pricing, and completely give that book up for life? They can and will earn more themselves and continue to reap the benefits of a 70% royalty while maintaining all the rights to their work. If publishers want to play the game, they have to pay according to what authors can make without them. Offer something that we can’t do on our own. Help us, believe in us, support us, and play damn fair for once.

While I’m certainly not making $150,000 a month, Flat-Out Love has done very well for me, and I’m earning enough that I can keep writing. I’m in the middle of another book right now, and I realized that one of the many fabulous things about working for myself is that I have complete freedom to write whatever the hell I want. A publisher certainly could have bought Flat-Out Love and signed me for a two or three-book deal. One of the many whopping hitches with that would have been that I’d then have to write another book or two that were in a very similar vein to Flat-Out Love. But I don’t want to do that. I want to write the book that I am now. The book that has swearing and sex. The book that is darker and edgier. The book that is definitely not for younger readers. A publisher would never have let me do that.

The New York Times recently ran an article about authors who are now writing two books a year instead of one. Why? Because they need the money. Of course they need the money! Their publishers are gouging them out of money that is rightfully theirs. When I read about one highly successful author who is now writing for fourteen hours a day, seven days a week, I thought, “What a lunatic. That’s not a life.” Look, I don’t think any author needs to release two or three books a year to earn a living. If that’s what you are comfortably able to do creatively speaking, go for it. Being on a publisher’s deadline to deliver a book every four to six months can be pretty rough. Life gets in the way, and emotions and creativity ebb and flow. Yes, writing is work and requires dedication, but it also has the capacity to be amazingly fun. Publishers, if you ask me, take a dump on much of the good stuff. For now, I’m happy to do one really strong, solid novel once every twelve to eighteen months. If I tried to bang out a book every few months, they would be crummy books, and I would be broke.

What’s funny is that despite loathing publishing houses these days, I actually hope that they pull their act together. They have distribution power. They have dedicated, talented people in the industry. They have the capability to do wonderful things. But for now they are so messed up, so outdated in the way they structure their contracts, and so often very out of touch with what readers want. Smart editors are often ruled by archaic designs. Do I have plans to seek out a publisher? Um, no. I can’t imagine one would take me anyhow. And I wouldn’t consider working with a publisher unless (until?) they make drastic changes to their business model.

Indie authors are writing for our readers, not for publishers and what they think will sell. And now we can afford to write! And I can assure you that freedom fuels creativity, risk-taking, and passion. We get to bring you our stories in the way we want to tell them, without the dilution and sculpting from publishing houses. And the fans? Oh, the fans are simply unbelievable. We are so directly connected to them, and the ease of communication and feedback is unparalleled. I’m learning what readers want, and I can incorporate that into my work without worrying that an editor will nix all the good stuff. Their support and enthusiasm breathes life into days when I feel particularly challenged.

And there are some spectacularly moving experiences. I’m in a circle of authors who have been dubbed The Cancer Warriors because our books have become saving graces for people going through cancer treatment. Readers are escaping hell on earth through our books. We sell smartly priced books with sharp content, books that never would have reached these readers without the ability to self-publish. We get to do our small part to help them fight. Getting to be part of something like this is at the top of my list for why I write. It makes me want to face New York publishers head on and scream, “You see that? Do you see what we’re doing without you?” Indie writing brought me into readers’ lives in ways that I never could have imagined.

I wouldn’t trade that for all of New York.

So yeah. Want to publish your books? Screw the old publishers. Self-publish and then let them try and woo you with a contract actually worthy of your hard work.

Facebook stocks only worth $18.75, possibly less

Facebook's vastly anticipated IPO (Initial Public Offering) on the stock market caused a lot of buzz amongst people who normally don't purchase stocks. Fans of Facebook were lining up at virtual stock trading companies to plunk down their $38 (or some multiplier thereof) to get themselves a share of Facebook's stock offering.

On the first day of trading the price quickly went up to $42 but by the end of first day was back down to $38.23 and would have fallen farther except the powers-that-be froze the stock price.

However since then it has been revealed the owners of Facebook may have committed fraud by lying about their profits, increasing the number of stocks by 25% and inflating the price of $25 by 52% to $38.

In reality the increased number of stocks also decreases their real value. Thus Facebook stocks are really only worth about $18.75... or less.

Why less? Several reasons. #1. Facebook has been lying about its profits. #2. Facebook doesn't have a strong history of profits. Yes, Facebook does sell advertising (and game credits) for a profit, but its overhead is still significant.

Today Facebook's stock price fell to $32, down $6 from its IPO price. The price is expected to continue to fall.

Facebook is now facing a class action lawsuit by stockholders who want their money back and say they were defrauded by false claims of profitability.

Canadian banks ripping off Canadians says 12-year-old girl

Twelve-year-old Victoria Grant from Cambridge Ontario has been giving a rehearsed speech to audiences at conferences about how “the banks and the government have colluded to financially enslave the people of Canada.”

The video has become an overnight Internet sensation after a video of her giving a scathing criticism of Canada’s banking industry went viral.



So basically the Emperor has No Clothes and as usual its a kid who is the first to point it out.

Research in Motion may be sold to competitor

Research in Motion (RIM) has hired an investment banker, sparking strong rumours that RIM may be sold to a competitor.

The list of interested competitors include Microsoft, Facebook and Google. As the makers of the popular BlackBerry RIM would be a nice purchase for a company wishing to increase their market share.

Samsung and Nokia might also be interested in buying RIM. At this point its all rumour, but time will tell.

Greece's economic bailout a failure

POLITICS - We predicted it a long time ago. The bailout of Greece's economy would only fail because they're not fixing the real problem: Lack of manufacturing.

We're not alone in our predictions.

Many European countries have strong doubts over whether a second massive bailout can actually save Greece. A second bailout which even now politicians in Athens are rushing to meet tough conditions to qualify for the €130 billion ($170 billion) 2nd bailout.

But that 2nd bailout money isn't going to save Greece and we're going to explain why.

Greece's problem isn't an issue of money. Its a problem of work. Not enough Greeks have work and unemployment in the country is sky high.

Even if Greece gets the 2nd batch of bailout money, how is that extra money supposed to help the average Greek? The bailout money will go towards paying for government employees already on the payroll. It isn't going to help the unemployed whatsoever.

For the last 2 years politicians have been wrangling and borrowing money to help Greece save their government from bankruptcy and defaulting on their loans.

Greece got the Eurozone to agree on the first €110 billion rescue for Greece in May 2010. But what did they do with that money? Spent it all on government workers already employed by the government. Teachers, police officers, the military, etc.

Several politicians in Germany, the Netherlands and Finland have grown tired of Greece repeatedly missing budget targets and failing to implement promised cuts, reforms and sales of state assets. Which frankly who can blame them? State assets help the government and selling off state assets to foreign investors is only going to reduce the government's control over their own economy and put that control in the hands of greedy overseas investors.

Such measures would only serve to harm Greece's economy over the longer term for a short term payoff.

Other countries have been forced in the past to do the same thing and their countries are now economic wreaks because of it. Any smart politician who truly loves his country sees what has happened in other countries which have sold off state assets and now know the true price of such backwards thinking.

Meanwhile Greece is in a steep recession, with its economy shrinking 7% in the final quarter of 2011 from a year earlier. Some economists believe it may even be a depression, the problem is that there is no technical definition for a depression and how to define one. The closest approximation is when the situation is so bad that people start selling everything they can at cut rate prices (deflation of commodities).

Other politicians are saying that the Eurozone should just let Greece default on their loans and that the Eurozone is strong enough to take the hit. But that isn't going to solve Greece's problems either. It will just reduce the pressure on paying the interest for its loans.

Since Greece is responsible for only 2% of Europe's economic output its believed the effects of a default would be minor. Some naysayers think it could effect global financial markets and might encourage other countries to also default on their loans.

The problem is how Europe / Greece is trying to solve their problems. Throwing money at the problem isn't going to make it go away.

#1. Greece needs to lower income taxes on manufacturing jobs. Make it more appealing for manufacturers to build things in Greece.

#2. Greece needs to lower corporate taxes on manufacturers and raise taxes on services.

#3. Greece needs to lower taxes (or completely remove taxes) on farmers. Basically anyone who is producing an actual "product" instead of a service needs a break.

#4. Greece needs to cut executive payouts by half until the economy recovers. Politicians and executives working for government owned institutions need to take a huge temporary pay cut. If they don't like it they can quit.

#5. Greece needs to increase income taxes on the rich and decrease the amount the wealthy get back for deductions.

Too much taxes on the poor and manufacturing hampers an economy. Using the above model and other measures to increase manufacturing jobs in Greece the problem of Greece's economy can be solved. The increases on taxes for the wealthy will counterbalance the budget changes.

Once the economy is back on the right footing then incremental changes can be made in an effort to pay off Greece's debts.

The problem therefore in the meantime is Greece's creditors, who want their money back and are insisting on changes that would ultimately bankrupt Greece down the road. Greece's leaders are wise to resist such calls to sell of government assets.

Given time Greece's economic reform will lead to recovery (especially if more drastic steps are taken to encourage manufacturing jobs), but creditors need to be patient.

Does wealth trickle down?

POLITICS - The concept that wealth trickles down is a complete sham.

Yes, technically, money flows in all directions of commerce. But tax cuts for the rich doesn't = the middle class and the poor making more money from "money trickling down" from the wealthy.

In fact its quite the opposite. The rich just get richer.

And the poor get poorer and the middle class becomes poorer too.

The best way to boost the economy is to have low (or almost no) taxes on the poor, have moderate taxes on the middle class and high taxes on the rich. This creates a balanced economy and ensures economic prosperity.

Any politician who tells you "Wealth trickles down." is lying through their teeth and lining the pockets of their rich friends (who no doubt paid for the politicians election campaign).

By 2020 the American Car Industry will be a shadow of its former self

CARS - China is mass producing cars and they're getting very good at copying other car manufacturers. Imagine being able to buy a Ford Mustang... it looks like a Mustang, it drives like a Mustang, heck it is a Mustang in every way that matters. But it is made in China.

And its place of manufacturing isn't the only thing that would be different. It would also cost less than a third of what a Mustang currently costs.

Now ask yourself, what car do you think average Americans would buy when given the option between the American Mustang and the Chinese Mustang which is exactly the same but only a percentage of the price?

The answer is obvious. National pride can't compete with that kind of low prices.

And this isn't just a matter of Ford's growing manufacturing operations in China. Every major manufacturer is now building in China because they've realize that their competitors are doing the same thing and they have to stay competitive.

In 2011 all of Europe's car manufacturers made 1.7 million cars. China beat that easily with 3 million cars. The silly thing is that China is just getting started, by 2020 China will be producing an estimated 10 million cars per year (that is roughly 20% of all new cars that are sold annually currently) and their build quality keeps improving because they're copying the best designs from Europe, Japan and the USA.

So what it really adds up to is by 2020 you will be able to buy a car designed by German, Italian and Japanese engineers and built in China... and it will cost a percentage of a new car currently costs.

The end result will be American car manufacturers (and European manufacturers too) won't be able to compete. Even the big name supercar manufacturers like Ferrari, Aston Martin, Lamborghini will be thinking about moving their manufacturing to China because they have to stay competitive with their prices.

It isn't going to happen all at once either. It will happen in stages. Jumps. Economic jitters. The occasional recession. Government bailouts with money borrowed ironically from China.

Eventually China will realize they don't have to bailout the USA's debts and the USA will have to finally reconsider their economic model.

Feminism: When will we finally be equal?

By Suzanne MacNevin.

I had a comment on a different blog (Feminist Truths) a few days ago from a loser claiming that men are the unequal ones.

Ha.

Here is some interesting facts for those people who don't yet realize it just how unequal women still are:

#1. Women Make Less Than Men

It varies by country, but in the United Kingdom (the birthplace of modern feminism) women still make 14.9% less than men. In other countries the pay gap is significantly worse.

The following map shows the pay gap between men and women on a global scale.



Scandinavian countries and Australia apparently lead the way in pay equality, but there is still a long way to go.

#2. Education

According to a new report women in Ireland are more likely to have higher qualifications than men - but work fewer hours and earn less. The report found that women do better at university and college, but have difficulty finding work because of sexism in hiring practices and in the workplace.

#3. Athletics

Women are not allowed to compete in the four-man bobsled race in the Olympics. Why? Is there a rule against having four-women bobsled teams? WTF. If there is an event for men, why isn't there one for women?

There is also no women's ski jumping either. Why? Women can jump off an icy cliff on skis just as easily as a man can.

Women's sports in general are difficult to find, let alone sports which allow women to compete on equal footing. ie. Motorsport allows women and men to compete together. I think its because men will get upset and their egos hurt if women beat them in a fair competition.

Check out the Katherine Legge Story video below.



#4. Societal Expectations

Men are expected to have a career, be financially independent and raise a family. Why shouldn't women be expected to do the same thing?

#5. Politics

Can you name a country where men and women politicians are on equal footing? Even in Sweden men have 53% of the seats in parliament and Sweden is an oddity compared to the rest of the world where women are rare in politics.

#6. Treatment

Women may be equal in some countries in terms of the laws, but we're not equal in terms of how women are treated and viewed. We still have a long way to go before people realize that what is between our legs makes no difference on our abilities to accomplish goals and that we deserve to be treated and judged based on our actions.

Affiliate Programs = Scams

TECHNOLOGY - There are a lot of websites outside such as Amazon, CafePress, personals websites and more who offer an affiliate program to internet publishers.

The problem with these affiliate programs is they almost NEVER pay the internet publishers doing the hard work of advertising their product. You see the way affiliate programs work is that they're set up to pay the publisher based on every sale that came directly from the publisher's website.

The problem is that once people click on the advertisement they are taken to a website where they are basically given three choices:

1. Explore the website and then maybe choose to join after exploring. (Zero commission for the publisher.)

2. Sign up or buy something immediately. (Very rarely happens since most people choose to explore first.)

3. Leave the website because it doesn't interest them after all.

Next the publisher is trusting that the company running the affiliate program is going to be honest and share a percentage of their profits. The publisher is really taking them on their word for it. You are just a number to them, a number which can be taken advantage of.

The thing about advertising is that it is always a risk for the business paying for the advertising. With affiliate programs there is no risk for the business, the people posting the advertising are the ones taking the risk (and worse, wasting their time because they will never get paid).

The best route is to only accept two kinds of advertising:

1. PPC advertising via a major company such as Google, MSN or Yahoo! because they are guaranteed to pay you.

2. Cash in advance for annual advertising.

If they're offering an affiliate commission then its pretty much guaranteed they are running a scam in an effort to get free advertising and you will never see a dime.

Even the brand name affiliates like Amazon and CafePress never pay because you have to earn over $100 before they send you a cheque... and to earn that much you need to sell over $1000 worth of product via customers who go to their website via your ad and buy immediately without browsing.

The end result is that unless you have a super popular website then affiliate advertising just isn't worth it. And if you had a super popular website you'd be getting offers for cash in advance advertising and making oodles off Google / MSN / Yahoo! advertising anyway.

5 Tips for Spotting Scammers

1. They say "100% Guarantee" on their website. Why would they bother to say that unless they're trying to trick you?

2. They contact you directly and when you respond they launch into pressuring you and "promise" that people make lots of money advertising for them.

3. You've never heard of their company before.

4. They can't spell properly.

5. They're offering to send you a cheque from Nigeria.

120 Sears and Kmart stores to close

UNITED STATES - Sears has announced it will close 120 Sears and Kmart stores, the largest closing of its properties after disastrous holiday sales. The closings will effect 1000s of jobs.

The retailer will be closing 120 of its worst performing ("marginal") stores and will focus its resources on its top performing stores.

“Given our performance and the difficult economic environment, especially for big-ticket items, we intend to implement a series of actions to reduce ongoing expenses, adjust our asset base, and accelerate the transformation of our business model,” says CEO Louis D’Ambrosio. “These actions will better enable us to focus our investments on serving our customers.”

Sears Holdings Corp., based in Hoffman Estates, Illinois, hopes to generate $170 million in cash from inventory sales and additional proceeds from the sale or sublease of real estate.

Sears, which operates Kmart stores, Sears, Roebuck and Co. and Land’s End, has seen rival department stores like Macy’s Inc., discounters like Target and electronics stores like Best Buy and Future Shop steal loyal customers away, mostly people in the middle-income bracket.

Sears announced smaller closings earlier this year and had pinned their hopes on upbeat holiday sales. Sears Holdings has more than 4,000 stores in the U.S. and Canada.

Five Economics Predictions for 2012

POLITICS - What are economists saying about 2012? Lets find out.

IHS Global Insight expects global GDP to rise 2.7% in 2012, but they have other predictions as well. In 2010 eight out of 10 of IHS’s predictions proved to be correct.

1) United States recession?

Most economists think the USA will avoid a recession in 2012 and IHS agrees. They're predicting the first half of 2012 to be slow, but to pick up steam half-way through the year. They're expecting the USA's GDP to rise 2.5% by the end of 2012.

2) Europe

Fiscal confidence is plummeting in Europe, suggesting a mild recession in 2012. If Europe's debt problems are not solved however it could be much worse. The IHS is expecting Greece's GDP to drop 6% and Portugal's to drop 3%.

The IHS is predicting Greece might drop the Euro as its currency.

3) Asia

Asia will continue to have the strongest economic growth in the world (around 5.5%). Expect a rebound in post-earthquake Japan that will drive exports. Growth in China is expected to be about 8% or better.

4) Commodity Prices

Prices should stabilize and gold prices may drop. Expect oil prices to drop 30 to 40%. Prices should drop in North America/Europe due to weaker demand, but expect growing demand in China and India.

Geopolitical tensions and oil shortages may cause oil prices to go back up during the Summer of 2012, but not to any record levels unless there is a large war in a country such as Iran.

5) Inflation

Inflation will fall, particularly in North America and Europe. Central banks are unlikely to raise interest rates. In Europe deflation in poorer regions will become a growing concern.

Eurozone Credit Crunch

POLITICS - The European Union is facing a huge credit crunch and there really is only one solution...

Raise corporate taxes and income tax on the rich.

Instead the 17 finance ministers of the countries that use the Euro met at the EU headquarters today in a desperate bid to protect the value of the Euro and prevent a debt-induced financial tsunami that could sweep Europe.

The problem is that a number of European countries are spending beyond their means and their taxes are too low to support such spending. If they cut jobs it will cause a recession.

And you can't keep raising taxes on the poor and middle class, because that will also spark a recession.

The ONLY solution is to raise corporate taxes and income tax on the rich. Because the rich can afford it.

The problem is that the rich also make political donations and don't like extra corporate taxes. Which puts politicians in a hard place. Do they let their economy crumble (in which case the rich keep getting richer anyway) or do they become fiscally responsible?

The 17 ministers are discussing ideas that would have countries ceding fiscal sovereignty to a central authority; some kind of elite group of Euro nations that would guarantee one another’s loans — but require strong fiscal discipline from anyone wanting membership.

The question then becomes, what counts as fiscal discipline? Because cutting jobs or raising taxes on the poor would count as belt tightening, even if they're mistakes.

The fear is that the crisis — which has already forced bailouts of Greece, Ireland and Portugal — could engulf bigger economies such as Italy, the eurozone’s third-largest. If Italy were to default on its debt of €1.9 trillion ($2.5 trillion), the financial fallout could send shock waves throughout the global economy and spark another global recession.

Italy’s borrowing rates shot up today to above 7%t, an unsustainable level on a par with rates that forced the others to seek bailouts. And those bailouts just mean more debt. Its just paying debt with more debt.

Its like defaulting on your mortgage, selling the house, buying a BIGGER house and getting a bigger mortgage with a worse interest rate.

Worse these 17 finance ministers need to push their reforms through quickly... unlike previous reforms which took years to implement due to referendums.

The 17 ministers are also to discuss jointly issuing so-called Eurobonds — an all-for-one, one-for-all way of having the different countries guarantee one another’s debts. Right now each nation issues its own bonds, meaning that while Italy pays above 7 per cent, Germany pays about 2 per cent.

Having stronger countries like Germany stand behind the general European debt would lower Italy’s borrowing rates — and prevent a debt spiral that leads to a national bankruptcy. But it would raise Germany’s cost of borrowing, hence why Germany has been fiercely opposed to the Eurobond proposal.

If the European Union fails to fix its debt woes, bank lending would freeze, Europe's stock markets would likely crash, and Europe’s economies would crater. Economists believe such a collapse could see Europe’s economic output fall temporarily by as much as 50%, according to UBS forecasters.

Such debt problems would hinder the USA and Asian economies, the same way the US Recession sparked a global recession.

What the heck is a Reverse Mortgage Loan???

POLITICS - You would think the USA would be wary of mortgages and loans, but the truth is mortgages are a necessary evil in today's economics.

A "Reverse Mortgage" (I had to look this up on Wikipedia), one of the few times I actually find use for that website, is a release of equity...

Think of it a bit like selling your house, but slowly...! Its usually only done by seniors who are in retirement and want to slowly sell off their home (and not leave it for their kids).

However there are two types of Reverse Mortgages... large lump sum payments or multiple payments (which can set up monthly, thus giving the senior more money for their monthly budget). Its really for seniors who find themselves stretched for cash as they get older and find gasoline/food/electricity/health care costs are higher than they predicted.

The Reverse Mortgages adds a lien to the property so when the property is eventually sold (ie. the old couple dies or moves somewhere else) then the bank / lender gets their share of the equity from the sale of the property.

It may feel weird getting a Reverse Mortgage (it even sounds weird), but since a lot of Americans lost their jobs during the 2007 - 2009 recession and/or were forced into early retirement it is becoming a reality for many Americans.

There is also the matter of how much you can actually get. It really depends on the interest rates different banks and lenders are offering, where you live (real estate prices and interest rates vary by state and city), thus making it tricky to get an estimate on a reverse mortgage loan. Not an actual loan, just an estimate in an effort to calculate both the value of your home and the amount you can actually get either all at once or on a monthly basis.

If you later find / save / inherit money then you can also pay off the loan immediately. There is no required duration.

The good thing is that if your property keeps going up in value (American real estate prices have hit rock bottom and are now rising again) you won't have lost anything but a bit of equity.

Check out more real estate news at My Search for a Home.

America's Debt is a Ticking Time Bomb

POLITICS - The United States economy is sitting on a ticking time bomb which could strike at any time... its called a $14.35 trillion National Debt.

Earlier this week S&P downgraded the USA from its AAA rating to AA due to Republican unwillingness to cooperate with debt payments. It is the first time in world history that the USA has been considered a risky investment. The lowered rating means investors will be less likely to loan the USA money in the future, putting the USA one step closer to bankruptcy and financial collapse.

Only 16 of the 126 nations whose debt is rated by S&P earn its coveted triple-A rating, Canada among them. Republican unwillingness to pay off the US debt by raising taxes has led to a level of brinkmanship that is bordering on financial collapse just so they can blame Barack Obama if the economy turns sour.

But its not Barack Obama's fault this is happening. Its the fault of Republicans in Congress being wishy-washy on the best way to solve America's debt problems.

The USA can't cut social programs because that will hurt government jobs. One Republican proposal calls for the cutting of approx. 2 million American government jobs for the next 8 years. Cutting 2 million jobs would devastate the US economy.

The ONLY solution is to start raising taxes on the rich. The poor cannot take the pinch right now because the economy is too fragile, but the rich could certainly tighten their belts.

Meanwhile China’s central banker, Zhou Xiaochuan, is depicting the American debt as a threat to the world economy. “Big fluctuations and uncertainty in the U.S. Treasury market will influence the stability of international monetary and financial systems, thus hurting the global economic recovery,” the chief of the People’s Bank of China said last week. China is the world’s largest creditor nation and America's biggest lender.

Zhou says: “We hope that the U.S. government and the Congress will take concrete and responsible policy measures . . . to properly deal with its debt issues, so as to ensure smooth operation of the Treasury market and investor safety.”

In other words Congress needs to stop playing with matches.

The Xinhua News Agency meanwhile is calling Republican unwillingness to tax and pay off debt a “madcap farce” and called the American National debt a “ticking bomb”.

Especially since the USA will now have to pay higher interest rates on its riskier debt.

We should note however that America can recover.

S&P downgraded Canada in 1992, when Canada was too nonchalant about a record $43 billion deficit and didn't seem to have any goal to pay it off. S&P did not restore Canada's triple-A status until 2002, after 11 years of consecutive budget surpluses and clear efforts by the government of Jean Chretien to pay off a large chunk of the Canadian National Debt.

Thus we know from experience that it can be done.

The difference however is that Canada is a resource (mining, lumber, oil) driven economy... whereas the USA is manufacturing based... something the USA has been losing in recent years as more factory jobs go over to China and India.

WHAT IS THE SOLUTION???

The USA needs to cut taxes on manufacturing and raise taxes on the fat cats in Wall Street.

The only problem is that its Wall Street which is running the show in Congress. The White House and the American people are helpless to stop the corruption that is going on.

Americans need to be making products again. This era of stock brokers moving money around and not actually building anything while taking a percentage is hurting the US economy and its not sustainable.

Republican rebels hurting US economic prospects

POLITICS - The United States has never before defaulted on their debts.

If they do it will signal a huge change in US economic policy and make it increasingly difficult for the USA to get future loans.

Thanks to the Bush era overspending on the wars in Afghanistan and Iraq, plus the huge bailout of the US banking industry (which has since been proven to be fraudulent) and the Obama era stimulus package the United States is at a record level of debt: $14.35 trillion USD.

But Republicans in Congress are blocking any attempts to raise taxes on the rich to pay off the debts incurred by the banking industry induced recession of 2007-2009.

These hardline Republicans are deliberately trying to prevent any passage of bills or compromises which would create a budget deficit reduction plan. (Its almost like they WANT the USA to go into a recession.)

Emergency meetings this morning and Republican infighting further delays any compromise.

On Tuesday the US government will run out of money to pay all its bills.

The wise thing to do then is to tell Congress that they're not getting paid until they start raising taxes / making compromises towards solving the USA's budget woes.

On the top of the list of things to be done is to raise the USA's borrowing limit by August 2nd or risk a devastating default and downgrade of the USA's stellar credit rating that helps make US debt a pillar of the global financial system.

Republicans however are insisting on government cuts to spending (which would result in huge job losses). John Boehner, the top Republican in Congress, wants to cut $900 billion USD over 10 years, but even that isn't enough for some hardline Republicans.

John Boehner's proposal would mean cutting approximately 1.8 million jobs. It would be a devastating blow to the US economy and.

THE USA DOESN'T HAVE A CHOICE. They need to raise corporate taxes and taxes on the rich. Killing the economy by firing almost 2 million people is the opposite of what needs to be done.