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Here Comes A 2nd Stimulus Package

From those champions of fiscal responsibility at Reuters:

Current projected budget deficit, from the Congressional Budget Office.

U.S. should plan 2nd fiscal stimulus: economic adviser

By Vidya Ranganathan Tue Jul 7

SINGAPORE (Reuters) – The United States should be planning for a possible second round of fiscal stimulus to further prop up the economy after the $787 billion rescue package launched in February, an adviser to President Barack Obama said.

"We should be planning on a contingency basis for a second round of stimulus," Laura D’Andrea Tyson, a member of the panel advising President Barack Obama on tackling the economic crisis. said on Tuesday.

Addressing a seminar in Singapore, Tyson said she felt the first round of stimulus aimed to prop up the economy had been slightly smaller than she would have liked and that a possible second round should be directed at infrastructure investment.

"The stimulus is performing close to expectations but not in timing," Tyson said, referring to the slow pace at which the first round of stimulus had been spent on the economy.

Tyson, who is a dean of the Haas School of Business at University of California, Berkeley and was also a White House economic adviser to former President Bill Clinton, said an additional factor affecting the stimulus was that the economy was in a far worse shape than the administration had estimated.

INFLATION NOT A CONCERN

Tyson dispelled concerns about the ballooning U.S. fiscal deficit that is estimated to hit nearly 10 percent of gross domestic product, and its possible inflationary consequences.

"The Federal Reserve is not going to allow the U.S. to inflate away its debt," she said.

Asked about the value of the dollar, Tyson said the market was wrong to be concerned about inflation in the U.S. economy, given the amount of slack in most industries.

"It is almost in no one’s interest to have a sharply spiraling downward dollar," she said. The dollar ought to decline in the longer term on a trade-weighted basis but she did not anticipate a sharp and sudden decline…

Hilarious.

Tyson said she felt the first round of stimulus aimed to prop up the economy had been slightly smaller than she would have liked and that a possible second round should be directed at infrastructure investment.

So now we learn that the first ‘stimulus’ was not aimed at infrastructure after all.

This article was posted by Steve on Tuesday, July 7th, 2009. Comments are currently closed.

30 Responses to “Here Comes A 2nd Stimulus Package”

  1. proreason says:

    “INFLATION NOT A CONCERN ”

    and they consider themselves intellectually superior

  2. pdsand says:

    “The United States should be planning for a possible second round of fiscal stimulus to further prop up the economy after the $787 billion rescue package launched in February, an adviser to President Barack Obama said.”

    Doesn’t that have to imply that the first round of stimulus propped up the economy?

    “”The Federal Reserve is not going to allow the U.S. to inflate away its debt,” she said.”

    I’m glad to hear that, because up until now it appears that no force in Heaven or Earth can stop the U.S. from trying.

  3. Reality Bytes says:

    Lookin’ @ 09 reminds me of the ol’ joke. “Dis water’s cold!” “Yeah n deep too!” We fought a war against Britain over less.

  4. Petronius says:

    “We should be planning on a contingency basis for a second round of stimulus,” blah, blah, humma, humma, said one of the President’s Marxist economic advisers from Berkeley.

    I must be getting old. You know you’re getting old when you lose track of the number of stimulus packages. I would have sworn that I’ve already had two. But maybe the stimulus from last year does not count.

    But, hey, who’s keeping score? Since the other two stimuli didn’t work, since none of the stimuli have ever worked, we will have to endure a lot more of these things. Just keep trying, boys and girls, until we get it right!

    So we’ll keep digging our country deeper and deeper into a hole. Until we are all up to our eyeballs in muck. That must be what the Liberals mean by “shovel ready.”

    I believe it was Margaret Thatcher who said, “The problem with socialism is that eventually you run out of other people’s money.” At the rate Nerobama and the Liberals are cranking out these stimulus packages, etc., they might run out of our money pretty soon.

    • Liberals Demise says:

      You think there will be a market for breathing tubes once we are over our heads?

    • proreason says:

      I think the Bush stimulus in early 08 worked. That one was $152B in tax rebates that was paid out between March and June, 08..

      Look at the GNPs at that time.
      – For Q4 of 07, GNP growth was slightly negative.
      – For Q1 of 08, growth was +1%.
      – For Q2 of 08, growth was 2.9%.
      – Then for Q3 of 08, it was back to about fractional negative growth.
      – For Q4 of 08, the shit had hit the fan, and GNP was sharply down, where it has stayed since then.

      The stimulus wasn’t the only factor, but I think the raw numbers are some evidence that it worked.

      But since the tax rebates were only one-time, the positive impact didn’t stick. People spent the rebate (or saved it) and went back to being cautious with their money.

    • Petronius says:

      Thank you, Pro. The Bush-Pelosi redistribute-the-wealth-and-stimulus package may have moved the economy, but sadly it did not do much for old Petronius. Frankly, I get more stimulus from my daily dose of Metamucil than from all of these government stimulus packages put together.

      However, it does my heart good to learn that my tax dollars did help other, more deserving folks. You know . . . the poor, the downtrodden, the oppressed, the undocumented, the huddled masses yearning to smoke dope. No doubt my taxes alone provided for stimulation of several hundred Somali refugees, ACORN thugs, and other Nerobama supporters.

      When it comes to stimulation, never let it be said that Petronius does not do his bit. And now, LD and I are going out to corner the market on breathing tubes. . . .

  5. bronzeprofessor says:

    So wait, how can the stimulus package be “performing close to expectations but not in timing”?

    Isn’t timing part of the expectations?

  6. 12 Gauge Rage says:

    Another stimulus package? Where the heck is all this money coming from that was never there in the first place? It reminds me of a person running short of cash a few days before payday. So they float a check. But, fearful that the check might clear a day before payday, they float another check to cover the previous one.

    • Liberals Demise says:

      Get this 12, they have only spent 7% of the 1st package!
      We gotta hurry and spend the next one …. what is in the water there?

  7. 12 Gauge Rage says:

    Only 7%? That explains a lot. They need to pump out another ton of money to cover the rest of that 93%. The idiots. And they’re supposed to be the experts. Maybe we all are better off putting our money in mason jars and burying it in the ground. Or stuffing it in our mattresses. At least we’ll know where our money is and those thieves in Washington can keep their d**k skinners off of our wealth.

    • Liberals Demise says:

      Haven’t heard that term in over 30 yrs ………. gotta love the military lingo!! hahahahahahaha

    • proreason says:

      They are “expert” true-believers in Socialism.

      Depite the overwhelming evidence that Socialism has failed (vs free markets) every single time it has been tried.

  8. 12 Gauge Rage says:

    I thought you might like that. So, how much more patience should we have while Obama and his minions FUBAR our country?

    • Rusty Shackleford says:

      Problem is, 12 that while most of America is slow to comprehend the last shell game, the HNIC is doing his “hurry up offense” and getting closer to the goalposts.

      Although those of us who are quicker on the uptake see it….the 98% of “all the rest” are still reading the directions…or looking for their glasses.

      Thus, we will already sunk by the time it is fully understood and that is what Blammo (et al)is counting on.

  9. proreason says:

    I’m giving credit to myself.

    Back in the oct 2008 timeframe, as I watched the horror story in the market, and the ascent of the boy king I said a couple of times that tax receipts could fall by as much as 50%. I said this was because of job losses resulting from the market catastrophe, a disastrous drop-off in capital gains tax receipts, much lower coporate taxes, people cheating, and wealthy people hiding their money from the tax collector.

    Well take a look at the chart in this NewsBusters story. From Q2 08 to Q2 09, individual income tax receipts are down 42% and corporate income tax receipts are down 56%.

    http://newsbusters.org/blogs/tom-blumer/2009/07/09/slow-joe-biden-visiting-cincy-today-see-16-obamazebo-project

    Pretty good guess for a small-time blowhard commentor on a conservative website.

    The incredible drop in tax receipts indicates just how horrible this marxist induced fake financial crisis has been. I’ll bet that even OSoros didn’t want it to be this bad. But then again, that’s what you get when the criminal government works hand-in-hand with criminal private citizens to steal the wealth of a country and create a two-class society.

    • TNpatriot says:

      Pro, I have often said if they want to spread the wealth, then lead by example. Let the liberal elite give up their salaries and worldy possesions then come and tax me. But that’s another argument…

      As a tax accountant I see this first hand. Everyone is making less money. I could not believe the capital losses I saw for the 2008 tax year. At $3,000 capital loss limit most of these people wont be alive long enough to claim them, unless they miraculously earn some capital gains in the next few years, but at the rate the market is going I don’t see that happening. The real story no one talks about is the amount the actual deficit will be over the next few years. If I recall correctly the CBO bases their estimates on tax receipts from prior years. Imagine how deep the red ink will be when they only take in half the money they did last year.

    • proreason says:

      “unless they miraculously earn some capital gains in the next few years”

      I’m with Rush on this. He seems to be the only one (other than insignificant people like myself) who is saying that nobody really gets it.

      The problem isn’t so much that the economy is horrible. The much BIGGER problem is that the bastards have changed the game. The situation simply can’t be analyzed from the perspective of the last 100 years.

      Rush says, and I agree wholeheartedly that the rules have changed so significantly that there may never again be capital gains. Hell, there may never again be profits.

      I was talking to a very smart and fairly well-off friend today who has done better than most during this catastrophe. He said that he was back in the market and buying stock funds regularly in his 401K. I said he might want to think about that in light of what he knows about the Obama administration – seizure of the auto industry, siezure of the banking industry, seizure of the mortgage industry, compensation czar, imminent takeover of the Health Care industry, Cap and Tax.

      He cut me off. Didn’t want to hear it.

      People don’t want to face how bad things are, and that we are on the brink of a once-in-two-centuries catastrophe. When I say from time to time that lifestyles will be 10% to 50% of what they were in July 2008, I’m not kidding.

      They have to be stopped on Cap and Tax. And they have to be stopped on the Health Scare or the two-class society will become a reality……a few hundred thousand Aristocrat Commissars and the rest of us serfs.

    • TNpatriot says:

      I agree. I believe this adminstration’s goal is to change this country permanently. My biggest concern is what will they go after next? In my opinion they will begin to target peoples accumulated wealth. Whether it be in their 401Ks mutual funds, IRAs saving accounts, or whereever they can find it. I believe they would love to control all wealth and dole it out as they see fit. Of course it goes without saying they would enjoy the lions share of the spoils. It’s really scary stuff.

    • proreason says:

      “Whether it be in their 401Ks mutual funds”

      There has been some talk about siezing 401Ks you know.

      I haven’t heard it for a couple of months, but the proposal by a university marxist tool was to return 401K’s to Sep 08 valuations (the carrot), but to put them under government management. i.e., you would get 3% interest forever, and could only withdraw when daddy says so.

      Kind of like the Social Security Lockbox.

    • Petronius says:

      TNpatriot: “what will they go after next? In my opinion they will begin to target peoples accumulated wealth.”

      Correct. And they have already started.

      Currently they are going after wealth held by Americans in foreign bank accounts. In so doing the Administration is locking horns with the Swiss government, since Swiss law generally forbids banks to release names of customers.

      http://www.bloomberg.com/apps/…..YQivGDnNjA

      Your take on this Administration is the same as mine, and I share your concerns. They are real bastards.

    • TNpatriot says:

      Yes, I do recall there being mention of them taking control of 401k’s. That would only be the first step in my opinion, and I don’t believe we have heard the last of it. Perhaps the escalating finacial crisis and China, decideing to liquidate their Treasury bond holdings would be just the right crisis the administration is looking for?

    • TNpatriot says:

      Another point I think needs to be made about the administration, although I am veering off topic a little, is their handling of the stimulus money.

      I believe this is all by design. They never intended the stimulus to do anything now. They fully expected the unemployment rate to drop. Why do you think such a small percentage of the money has flowed into the economy now? It really was by design. They intend the money to start flowing when election time comes around. They are simply holding that money in reserve until 2010. The economy can not help but improve with the injection of several hundred billion dollars. At that point, with the MSM help of course they will point to their selected numbers and say see what we did, everything is better now. Then with another election firmly locked they can really begin to implement their agenda. These are some smart cats we’re dealing with here, and I believe they have been planning this for years.

    • proreason says:

      “It really was by design. ”

      yep.

      But life has a way of interfering with the best laid plans.

      There are a LOT of people in this country who are fed up to the gills with the tyrants, and aren’t fooled by the baritone voice and the pretense of moderation.

      And that number is growing. Rasmussen measures it daily.

      There is still time for reason to prevail. And if it does prevail, I’m for a judicious use of the pitchforks on the criminals.

    • TNpatriot says:

      I pray that you are correct pro. I am one of the people “fed up to the gills” believe me.

      I am a bit sceptical though. I think as of yet we have only seen them laying the foundation for their scheme. Once the 2010 election cycle comes around we will begin to see the money flow. Then the media will begin feeding the masses tales of how the recession is over and everything is roses now. I’m just not sure there are enough people out there who wont fall for it.

  10. Petronius says:

    Sorry, my Bloomberg link didn’t work. So here’s the gist of it:

    Switzerland Says It May Seize UBS Data Sought by U.S. (Update2)

    By David Voreacos, Michael McKee and Mort Lucoff

    July 8 (Bloomberg) — Switzerland said it would seize UBS AG data to prevent the U.S. Justice Department from pursuing a U.S. court order seeking the identities of 52,000 American account holders in a crackdown on tax evaders.

    The assertion came in court papers yesterday in federal court in Miami, where the Justice Department sued UBS on Feb. 19, a day after the bank avoided U.S. prosecution for helping wealthy Americans evade taxes. The U.S. effort to enforce a summons seeking the names would force UBS to violate Swiss laws barring disclosure of such data, the filing said.

    The Swiss government “will use its legal authority to ensure that the bank cannot be pressured to transmit the information illegally, including if necessary by issuing an order taking effective control of the data at UBS that is the subject of the summons,” according to the filing.

    In an order today, U.S. District Judge Alan Gold told the Justice Department to respond by July 12 to the Swiss filing. Gold said the U.S. should explain “how far it intends to proceed by way of request for enforcement, up through and including receivership and/or seizure of UBS’ assets within the United States” if he grants the petition and the Swiss “prevent or otherwise prohibit UBS from complying.”

    * * * The bank and Switzerland have since argued that the U.S. lawsuit represents a threat to Swiss sovereignty. * * *

    * * * “The IRS now inappropriately seeks to provoke international conflict through this civil proceeding.”

    The Swiss minister of economic affairs, Doris Leuthard, said her country has not resolved how to act. * * *

    “We can’t accept the American authorities coming and saying ‘OK, give me 50,000 names,’” Leuthard said. * * *

    Leuthard cited the collapse of Lehman Brothers Holdings Inc., which filed the biggest bankruptcy in U.S. history, as a warning not to push UBS to the brink.

    “When banks of this size have severe problems, this violates financial stability massively,” she said. “This can’t be in the interests of the United States. We learned in the last year that financial stability is the first priority, and this must be considered.” * * *

    • Dangerous says:

      It’s not in the interests of the United States.

      It is, however, in the interests of the select few who want to control the country. Personal power is their first priority, and they have to stay solvent long enough to bankrupt their future serfs.

    • Petronius says:

      That’s right, Dangerous. They have already taken $780M in fines out of UBS, and they really don’t care if UBS sinks, or for that matter if all the Swiss banks sink.

      Besides, they can always justify it as a necessary step to “crackdown on tax evaders.” Did you notice how Bloomberg assumes that all 52,000 Americans are “tax evaders”?

      However, it is NOT illegal to avoid taxes. Everybody who invests in muni bonds avoids taxes. It is only illegal to cheat on taxes. Furthermore, the legal point made by the Swiss is that the US government doesn’t even know if these account holders have paid taxes on their foreign income. Nor whether they even had any foreign income. After all, a lot of these may be cash held in non-interest paying accounts––accounts set up by Americans who simply lost faith in the US dollar and wanted to park their wealth in Swiss francs or other strong currencies to weather out the storm.

      The whole operation is a massive grab for power and other people’s wealth.

    • proreason says:

      “The whole operation is a massive grab for power and other people’s wealth.”

      Just another day in obamyland.

      But he isn’t satisfied with just confiscating the wealth of the greatest country of all time, he’s pissed off when you don’t love him for doing it.

  11. Gladius et Scutum says:

    There’s a business school at Berkeley? If swallowed something evil and need to toss your cookies – http://groups.haas.berkeley.edu/nonprofit/

    If you spot the “Oakland Small Schools Residency” you might recall that the Small Schools Initiative was started by University of Illinois (Chicago) professor William “Billy the Bomber” Ayers.

    Destruction of the capitalist order, I suppose, requires some sort of education.


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