Toro

I found out today that my phone is probably being tapped. I can call out but am having difficulty with incoming calls. If I can answer a phone call within a second or two of the phone ringing, I am able to connect with the person on the other line. However, after a few seconds, if I do not answer the phone, the line clicks dead and is followed by white noise. I called the phone company and they think the line has been tapped. This afternoon, we noticed that calls were coming in and the caller would seem to hang up after a few seconds. If this happened once or twice, this would not raise suspicion. However, when it happens 10-12 times in short succession, something is going on. I had a friend over tonight who is an IT professional. He said a friend of his in Atlanta had the same thing happen to him on Friday. It also happened at his work. He believes that it may be the work of hackers trying to tap his computer. I do not know what is happening exactly, and am having a repairman come out to check everything on Sunday or Monday, but I wanted to give everyone a head's up and be aware of what is going on.

Because it is too bloody hot to work hard. I realized why there are so many basket cases on the equator after I moved to Florida and spent a few summers here. You have no energy to work when its 100F. That's why air conditioning is one of the most important inventions of all time.

The NBER is perhaps the pre-eminent research organization for economics in the United States. I was merely presenting the evidence against the poster who said that tax cuts do not effect the economy. Of course they do. Tax cuts do not balance the government's budget, like some of the supply-siders argue. Nor are they a cure-all for everything. But to dismiss tax cuts out of hand as not effecting the economy is simply flat-out wrong. The single best policy that the Canadian government can do right here right now to provide stimulus is to cut the payroll tax. It lowers that cost of employing people, keeping people at their jobs, and puts more money in people's pockets. The former is more important as a stimulus effect because individuals are likely to save their portion of the tax cut.

The National Bureau of Economic Research is not a "right-wing think tank." Almost all of those links come from the NBER. http://www.nber.org/info.html

Its pretty simple. If you think the economic crisis is going to get worse, the Canadian dollar will go down. If you think that the economic crisis is going to get better, the loonie will go up. If you think things will be about the same as they are now, the loonie will go sideways. The fair value of the loonie based on purchasing power parity is about 80 cents, meaning it is trading around where it should.

Tax cuts on corporate income increase the corporate tax share as a percentage of GDP http://www.cato.org/pubs/tbb/tbb_1107_49.pdf Decreasing payroll taxes and instituting a flat corporate income tax would triple entrepreneurial activity. http://www.nber.org/digest/nov02/w9015.html Taxes on wireless services destroys more economic value than the tax revenues it brings in. http://www.nber.org/digest/jan00/w7281.html Higher tax rates on labor income and consumption expenditures lead to less work time in the legal market sector, more time working in the household sector, a larger underground economy, and smaller shares of national output and employment in industries that rely heavily on low-wage, low-skill labor inputs. http://www.nber.org/digest/dec04/w10509.html High Income Taxes Inhibit the Growth of Small Firms http://www.nber.org/digest/apr01/w7980.html Taxes Discourage Mutual Fund Investors http://www.nber.org/digest/jul00/w7595.html Differences in taxes across countries are a very important piece of the explanation for the vastly different levels of hours of market work hours of work in the United States were roughly the same in 1956 and 2004, while hours of work in Germany decreased by about 40 percent over this same period. http://www.nber.org/digest/may07/w12786.html Internet sales are highly sensitive to local taxation. People who live in high sales tax locations are significantly more likely to make purchases over the Internet. http://www.nber.org/digest/may99/w6863.html Estate taxes do have a negative impact on the accumulation of wealth. An estate tax rate of 50 percent (just below the current top rate) is associated with a reduction in the reported net worth of the richest half percent of the population of 10.5 percent. http://www.nber.org/digest/mar01/w7960.html U.S. equity Foreign Portfolio Investment in the average treaty country rose by over 90 percent relative to U.S. equity holdings in the average non-treaty country, in response to the large relative decrease in the dividend tax rate for corporations in treaty countries. http://www.nber.org/digest/jul08/w13281.html Tax changes have very large effects: an exogenous tax increase of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent. http://www.nber.org/digest/mar08/w13264.html Europe's failure to develop the kind of thriving service sector that has transformed the U.S. economy, a deficiency for which high taxes are largely to blame, is the main culprit behind the fact that over the last fifty years, hours worked in Europe have declined by almost 45 percent compared to hours worked in the United States. That's the conclusion of NBER Research Associate Richard Rogerson in Structural Transformation and the Deterioration of European Labor Markets (NBER Working Paper No. 12889). He finds that over the last half a century, European economies have suffered from a form of arrested development. http://www.nber.org/digest/septoct07/w12889.html Our data reveal a consistent and large adverse effect of corporate taxation on both investment and entrepreneurship. A 10 percentage point increase in the effective corporate tax rate reduces the investment to GDP ratio by about 2 percentage points, and the official entry rate by 1.3 percentage points ... Recognizing that we have data on many developing countries, we also consider the effect of corporate taxes on the unofficial economy. We find that higher corporate taxes are associated with a larger unofficial economy, consistent with our findings on entry by official firms. This suggests that an important margin on which corporate taxation might influence macroeconomic outcomes is by keeping firms unofficial. http://www.nber.org/confer/2007/pef07/shleifer.pdf We examine the extent to which taxes on corporate income are shifted onto the workforce in the form of lower wages. We find that a significant part of the effective incidence of the tax falls on wages. Our central estimate is that 54% of any additional tax is passed on in lower wages, even in the short run; other estimates are larger than this. In the longer run, a $1 rise in the tax liability results in a fall in total employee compensation in excess of $1. http://users.ox.ac.uk/~mast1732/RePEc/pdf/WP0707.pdf And so on...

http://www.montrealgazette.com/news/todays...5536/story.html

Yet he still thinks Canada should still be forking over equalization payments even though NFLD is a have province. Hmmm.... And I invest for a living. If I were investing in NFLD, I'd want an iron-clad contract with disputes adjudicated outside of the province.

The Banana Republic of Newfoundland. Hugo Chavez ain't got nothin' on Newfoundland and Labrador premier, Danny Williams. Ol' Hugh at least pays compensation for expropriating private assets owned by corporations, unlike Williams, who is just taking the assets of forestry company AbitibiBowater. Scratch Newfoundland off the list of places to invest.

The US is definitely slowing. The question is whether or not there will be a recession. That's hard to say. The latest beige book said that everything other than housing was strong. And the OECD expects US growth to accelerate. But the 10 year TBond has rallied and yields touched 4.75%. And housing is definitely rolling over. OFHEO said that the decleration in the growth rate of home appreciation was the highest in 3 decades. There definitely was a bubble in housing and now its bursting. IMHO the policies of the government and the central bank pulled consumption forward. I think we'll see below trend growth for the next while. My guess is that the Fed is done and that the next move by the Fed will be to cut rates.

The "secret" has been known for about 100 years. We're a couple decades away from full-scale production of oil from shale. But the potential is massive. From the Rand Corporation http://rand.org/pubs/monographs/2005/RAND_MG414.pdf

I work in capital markets. My institution moves hundreds of millions, sometimes billions, of dollars daily. I see how vital foreign capital is to the functioning of this country. If the US instituted policies that caused significant capital flight, I can tell you with complete confidence that the US economy would collapse.

It is my impression that those making this argument have not thought it through. In very simple terms, this is an argument about wealth. The US economy needs oil. If oil becomes scarce, wars will break out over oil because it is a "strategic resource," or so the argument goes. The problem with this argument is that if the world is on the verge of war over oil because it is so scarce, the world economy will either be on the verge of collapse or will have already done so. The world is integrated. America seizing oil and keeping it for itself means that the economies of Europe and Asia cannot be sustained because they will not have, or have much less oil. A collapsing economy in Europe and Asia means a collapsing economy for America. The US economy cannot operate without inflows of international capital. When economies collapse, capital flows back into the country. Because America is a net importer of capital, capital flows out of America and Thelonius's doomsday scenario plays out. Interest rates in America skyrocket as the dollar collapses, leading to a collapse in consumer spending and a collapse of the US economy, not to mention that oil would probably be trading at $1000 a barrel. The United States does not want to see disruptions in the free flow of oil (which is one reason why the US navy patrols the shipping lanes of the world.) Security of supply is a tactical immediate maneuver. It is not a strategic long-term one. The strategic imperative is a long-term solution focusing on alternative sources of energy. As one energy professional put it, "The age of oil will end before the last drop of oil is consumed."

I don't necessarily disagree with this Thelonius. But what I'm saying is that oil traded in euros in Tehran or Riyadh or Oslo or London for that matter will not trigger a flow away from dollars as the world's reserve currency. If that does happen, it will be because the US is deliberately debasing its currency. Besides, 65% of global reserves are in dollars while the US accounts for 30% global GDP. If I were advising a central bank, I would advise the bank on that fact alone to decrease their exposure to dollars. But to what is the other question because the euro is a structurally weak currency. To that end, the US aided Iraq with intelligence and weaponry, lest it fall to Iran and jeopardize Gulf Oil. evidence here... http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/iraq61.pdf While it is true that the US does not receive the bulk of it's oil from Iraq, the other suppliers would have seen the rest of the world clamouring for contracts to ensure supply, regardless of price increases. The main interest in the United States is the free flow of oil. Thus, it would make sense for the US to ensure that the fields did not fall under the control of a foreign power. It was in the best interests of the US to ensure that no one country became too powerful in the middle east. That is why the US supported both Iran and Iraq when the two countries were at war. It is why the US lead a coalition to liberate Kuwait.

They were low-balling the figure. Privately, some in government were saying it would be more than $200 billion. If you ran the numbers, and you made reasonable assumptions, there was no way the US could have done it for that little, unless everything went perfectly, which they never do in war. The Bush administration has done this elsewhere. They disciplined an analyst who wrote that the medicare prescription bill would cost around $540 billion, not $400 billion the administration was saying. The analyst is probably going to be right in the end. Here is another shenanigan the White House is pulling off right now. But that's besides the point. The government knew that they would have to spend a lot of money, regardless what they were telling the public, far more than the net present value that would accrue to the United States.

I seem to recall some getting all bent out of shape when Tom Long, who was born in Michigan, ran for the head of the Tories. I agree. Unfortunately, they link those issues on the Left.

They weren't going to spend $200 billion, remember? Y'all have amnesia? Are you being facetious? Of course they were. They knew it. Before the war, former Secretary of the Treasury, Lawrence Summers said that it would cost over $200 billion.

If that happens, it will not be because of anything that happens in Tehran, Thelonius. Or Baghdad. Or Caracas. Those places simply don't matter. What matters is what people think in Beijing and Tokyo and Seoul and Taipei and Frankfurt. They are the people who hold all the dollars.

I was just going to say that, he never was a conservative though, Joe Clarke called him a tourist Tory party because of his left-leaning views. He just wants to use any political party as a vehicle for his own agenda. Actually, I thought he was involved with Joe Hugelin in the new 'progressive conservative party', but maybe not. I knew him well before that. I used to have run-ins with him before the 1988 election when I was at University in Saskatoon. His behavior and those of his followers was bizarre at times.

No. All it will do is migrate currency trading to jusidictions that will not institute the tax.

Since, one day, Saddam will be dead, this statement can only be perceived in the short term. Iraq was producing about 1-1.5 million barrels of day. The world produces 85 million. Yet the US was going to spend over $200 billion to secure that short term supply.

This is an utterly bizarre argument propogated by people with little knowledge about capital markets, oil markets, capital flows and central banking. FYI, the daily value traded in the currency market is estimated at $2 trillion. Roughly half of that is in US dollars. Global trade is something like $20 trillion per year. The oil market is somewhere around 5-10% of global trade, or $1-$2 trillion. In other words, currency markets trade US dollars about the same value in two days as all the international trade in oil for one year. Better yet, Iran pumps out about 4 million barrels a day, around 5% of the 85 million barrels produced each day around the globe. Thus, dollar currency traders will have traded the annual production of Iran in 2.5 hours. And Iran's oil bourse is supposed to collapse the dollar. Right.

You might convince a few of them, but the debate is not directed at them - its directed at the undecideds. Absolutely correct. That's a very interesting question. Lord Browne CEO of BP says that the long-term price of oil will go back to $40 and lower. Exxon says the same thing. Why? Oddly enough, because the higher the price of oil goes, the more Big Oil's reserves go down. This is because when the oil companies were negotiating reserves with these third world countries, the price of oil never went above $40, and stayed in a band between $15 and $30 most of the time. Thus, in a concession to the countries, the oil companies negotiated that the reserves in the countries would be booked to the company with a royalty paid to the country at a constant rate. However, if the price of oil were to rise above $40 - something that had never happened before - the countries would receive an escalating royalty. That's a great sell to the countries, while the oil companies, smug in their belief that they knew more about oil markets than the rubes on the other side of the table, never thought the price would get above that level. Now, the way accounting works for oil companies, the higher the concession that must be paid to host country, the lower the amount of bookable reserves. (Or something like that. I'd have to go back and check.) Wall Street pays a higher multiple for growing reserves, not declining reserves. Its not a problem currently, since the companies are making money hand over fist. But there will be an effect when Wall Street starts seeing the decline in reserves. To offset this, what the companies will do, and are doing, is buy other energy companies to hide the decline. America is involved in the Middle East because there is oil in the region. However, the US did not invade to secure a source of supply. What matter to the United States is that the flow of oil is not restricted.

This is true when OPEC has excess capacity. Currently, it has none, and the price of oil is now being set solely by the market. Not in the long run, but it can and has in the short run since the market bids up the price of crude due to war. Or paid Saddam off rather than spend $200+ billion invading a country.

Orchard's a nutbar.