# The Next Great Depression.



## roman (Sep 28, 2007)

Is it happening now. Seems like every single day, every single hour, another 10,000 people are being laid off. Hundreds, even thousands of stores shutting down, saw mills closing and loggers sent home. The price of lobster hasnt been this low in decades…..............but the price of cocoa has never been higher.

Its not a crisis limited to one country albeit some countries can and will ride through this storm better then others.

I live in Canada where, or at least where I live, the recession/depression has yet to arrive. Sure some business's shut down for the Holiday 2 week break who in the past, never shut down even for a day but it really hasnt hit home here…..................but I for one, know that its coming.

I no longer dine out (OK, sometimes I take the bride out for breakfast). I was about to purchase a greenhouse but …....I'm not sure of I should because should work run out, I'm going to need that money. I used to purchase a nice prime rib roast but now choose a nice round roast. I dont drive as much, trying to get into town once a week instead of 3 days a week. I could go on forever but.

I really thought that next spring I could put covered stairs up to the loft of barn, finish the fencing and close in the leanto…....................but I kinda doubt thats happening.

I see so many men who were only a year away from retiring only to see their savings, RSP's, mutual funds just wiped out. I sometimes go to suppliers that have 5 people working behind the desk, where there was a line up of customers and at 11:00 am….............I'm the first customer of the day.

How many people will quit fixing their teeth.

I guess I'm one of the lucky ones. I have a nice shop and very little in the way of overhead so competing agianst shops with rent of 5 grand, a grand in tool payments, heat bils and hydro bills…......i'm in a good spot.

I do remind myself that our boys are dieing overseas. That they dont have the simple luxuries I have grown to expect. That they carry around 50 pound sacks in temperatures that reach 50 degrees celcius. I count myself as being very very lucky.

How are you dealing with it?

Do you think its going to get a lot worse before it gets better?

Do you think your going to have a job this time next year?..............or do you think that some guy/woman will get your job only they will do it in India for a fraction of the cost?


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## Woodchuck1957 (Feb 4, 2008)

Actually I'm tired of listening to all the doom and gloom just because some of the filthy rich that got us into this mess are just now starting to feel it. I don't think the news media is helping matters any either.


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## boboswin (May 23, 2007)

Jay Leno's economic jokes

1. The US has made a new weapon that destroys people but keeps the building standing. Its called the stock market.

2. Do you have any idea how cheap stocks are? Wall Street is now being called Wal Mart Street.

3. The difference between a pigeon and a London investment banker. The pigeon can still make a deposit on a BMW

4. What's the difference between a guy who lost everything in Las Vegas and an investment banker? A tie!

5. The problem with investment bank balance sheet is that on the left side nothing's right and on the right side nothing's left.

6. I want to warn people from Nigeria who might be watching our show, if you get any emails from Washington asking for money, it's a scam. Don't fall for it.

7. Bush was asked about the credit crunch. He said it was his favourite candy bar.

8. The rescue bill was about 450 pages. President Bush's copy is even thicker. They had to include pictures.

9. President Bush's response was to meet some small business owners in San Antonio last week. The small business owners are General Motors, General Electric and Century 21.

10. What worries me most about the credit crunch is that if one of my cheques is returned stamped 'insufficient funds'. I won't know whether that refers to mine or the bank's.

I'll pass comment on this deal as Roman said it all.

Cheers

Bob


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## Tangle (Jul 21, 2007)

I think you are right about one thing; those of us with a shop on the back of the lot are in better shape than the big shops. You're also right that at least no one is shooting at us while we run with 50 pounds of gear. I guess we'll know more in a month or so, won't we?


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## CharlieM1958 (Nov 7, 2006)

I agree with Woodchuck1957. Yes, there is a problem with consumers who have bought too much on credit, including homes they could not really afford, and the predatory lending institutions who have acted irresponsibly. But the biggest crisis the economy is facing is the crisis of investor confidence. The more doom and gloom is trumpeted by the media, the more investors and consumers hold their cash on the sidelines. And the more cash is held on the sidelines, the worse the economy is affected. It is a vicious cycle that is really out of proportion to the actual problems.


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## roman (Sep 28, 2007)

My bride is tied of hearing it too. She pretends that it isnt happening and coming. She honestly thinks that Governments cant go bankrupt.

I guess its like greenhouse warming. Nobody wants to hear it, nobody thinks its true, most want to just sweep the BS under the rug and pretend it isnt going to happen to them.

But when their job disappears, when their garden goes dry….......then they squack


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## roman (Sep 28, 2007)

media…..................somebody's gotta do that job and crappy but bad news sells newspapers.

Leons a funny guy isnt he. I doubt he has anything to worry about.


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## DanLyke (Feb 8, 2007)

Nothing changing here, except I might move some assets that have been in Money Markets into stocks at some point, now that those prices have come down to something approaching reasonable and justifiable.

We don't buy lots of stuff, we have a little bit of our house in an adjustable rate, but right now that's lower than our fixed rate portion (although we're watching carefully, 'cause we know there'll be big inflation sometime in the next few years), I've still got clients, life goes on. It's just that now I feel like I understand the economy, last year I thought it was bizarrely out of whack.


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## boboswin (May 23, 2007)

I have always found it odd that when a subject that *should be discussed *that has universal impact is broached that there is always a loud chorus from the mass suggesting the context is *too controversial*.
So it never gets discussed and eventually the problem is overwhelming.
It's a crap way to run a business or country.
We have a genuine problem and we should be trying to find way to fix it as well as protect each other.

As for the Media-they sell news. Bad new sells better than good news.

Bob


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## CharlieM1958 (Nov 7, 2006)

Bob, I don't know if you are referring in part to what I said, but I wasn't suggesting for a minute that the problem shouldn't be discussed. Neither was I suggesting that there wasn't a real problem.

The economic crisis is very real indeed, and many people are being, and will continue to be, severely hurt by it. My point was that, IMO, the collective state of mind of consumers and investors is contributing to the crisis as much as the actual events that triggered it.

The media will report bad news… that is a fact of life, that is their job, and it's not going to change. I'm just saying that if we are going to discuss the causes, let's not leave out the fact that panic throws fuel on this fire.


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## FEDSAWDAVE (Jan 1, 2009)

I quite frankly glanced at the 1st post and read Woodchucks entire post and that is it.

I to refuse to be bombarded with doom & gloom for the simple fact that it WILL affect your way of thinking and not in a positive fashion. I'm going to work my butt off 24/7 and be positive…positive…posiitive!

We are afterall…STILL AMERICA !


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## hObOmOnk (Feb 6, 2007)

I've dedicated my wood crafting efforts to making rustic furniture in the tradition of my family.
I learned my craft from my Grandfather, who made rustic furniture and sold it on the streets during the Great Depression.

Perhaps my chosen craft will take a prophetic turn?


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## boboswin (May 23, 2007)

Charley, you are too sensitive.
Once agian this is not a "Made in USA" problem.
It's a *Global situation* and must be addressed as such.

I don't feel that whispering "fire" is much of a solution either.

Bob


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## CharlieM1958 (Nov 7, 2006)

Bob, it wasn't a question of sensitivity….. I just wasn't sure if you had misunderstood the point of my post, and I hoped to clarify it a bit.

Let's talk about solutions. I think the best thing I can personally do for the economy is to keep coming to work every day, and to keep enjoying the fruits of my labor in a responsible manner. I believe the *worst* thing I can do is to pull all my 401k money out of the stock market, stop going out to eat, stop buying new clothes, keep driving a failing clunker even though I have cash in the bank for a new car, etc…etc… I'm not suggesting frivolous spending at all, but hording my marbles is only going to make the situation worse.


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## boboswin (May 23, 2007)

O.k. Charley, you asked the question. I tried to respond.

I truly believe that the problem for the North America exists because of too much bureaucracy , too much Government, and an overly expectant population.

It's become virtually impossible to operate here in North America with all the regulations on one side and greedy self serving unions pressing the other. We simply can't compete. 
Taking money out of the treasuries to bail out industries that have failed and are failing is a subtle way of increasing taxes in the future. ( rewarding for failures)

*The money has to come from somewhere and we are no doubt that somewhere.*

The government sent our best and brightest off to protect some people in foreign countries and subsidized the stupidity by selling Treasury bills to the Chinese. (who incidentally didn't go to war but merely profited from it by taking over our industries one at a time and destroying the value they once had by produced inferior quality for our land fills.)
There is still a huge sense of "entitlement" out there that says I deserve more because I'm a (name a state/province or country here)

It's a new game now Charley and we will have to face up to the fact that there are people out there willing to work harder, faster, and better than us for less money and without the encumbrances of a backward shortsighted government.

Today it often costs more to do business than the business is worth.

Most of that is due to hidden taxes.

Bob


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## dennis (Aug 3, 2006)

I'm going to start a new woodworking line of soap boxes and bandwagons. They will all be personally tested. I think a human scale economy might pull us out, but we keep shooting billions at wall street and waiting for main street to recover. We do not have a healthy economy when it is all tied up in large corporations. What I would like to see is 20 small auto companies. Banks that pay interest on savings accounts so they have money to lend rather than just have SAM print up another trillion. mummmble grummmble better go make saw dust….


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## pommy (Apr 17, 2008)

*bob* I dont want to upset the masses but the only people to blame for the trouble the world is in is the *banks *they are the one's who stopped leanding each other money
They are the one's who are closing business's by rainning the money owed back
Today the *bank of england *dropped their intrest rate to 1.5% the lowest rate in 300 years since they set up
And it's the big company's here that are suffering woolworths closed completely after 100 years of trading and a lot of oversea's company's are pulling out of the uk and going east 
so all we can do is pay the mortgage and tax's and stuff the rest they carn't* kill me *and *what i haven't got they carn't have *

andy


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## CharlieM1958 (Nov 7, 2006)

Bob, I don't disagree with anything you said above. There are a world of factors out there, many of which are the subjects of entire books by themselves. The issue of unions pricing North American labor out of the market has been brewing for a long time.

Again, my only point in chiming in here in the first place was to express my belief that, since the recent collapse of the housing market, fear has played a large part in making this snowball roll downhill even faster.


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## boboswin (May 23, 2007)

Charley, Fear and Greed are what drives capitalism.

We no longer have Capitialism we have "Kingdoms"

Bob


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## pommy (Apr 17, 2008)

Guys can i say one thing more we have to remember we all have had it bloody good for a long time it had to end sometime

andy


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## CharlieM1958 (Nov 7, 2006)

Every part of life swings on a pendulum, Andy. When anything goes far enough in one direction, it's bound to start swinging back the other way. This too shall pass.


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## pommy (Apr 17, 2008)

We all hope so charlie like you guy's over the pond our housing market is stuffed and we all pray for our job's daily but i mean what i say they carn't kill me if i dont pay the bank

andy


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## Michael121 (Jun 30, 2008)

As Mark Twain said…."There is no true American criminal class…except Congress"

It was not preditory lenders it was Congress all the way. The American Dream is not home ownership. It is freedom pure and simple.

Just wait the government will want to tax woodworkers somehow.

We are still paying a tax on our phone bills to pay for the Spanish American War. It has been over for 100 years.


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## Gene01 (Jan 5, 2009)

Capitalism is the natural outgrowth of Freedom. Just like Love and Marriage, you can't have one without the other.
Any act that diminishes either Capitalism or Freedom diminishes the citizen by limiting choice. 
Where is John Galt when we need him?


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## Padre (Nov 5, 2008)

I beg to differ, but I see the predatory lenders, the lack of governmental oversight, the amazingly rich investors, the equally rich top echelon financiers (CEO's, etc.) and the top 1% of our financial pyramid as the major culprits here.

C'mon, millions of people without health insurance but the CEO of Aetna makes $300 million a year? How many people would that amount give health insurance to?

The CEO of stock companies, going bankrupt, selling at a fire sale, losing investors billions, making over $40 million for the year all of this happened?

Why is someone worth 30 million dollars a year to play a game?? Hit a ball??

How much is enough?


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## Padre (Nov 5, 2008)

Gene,
You can definitely have love without marriage, and marriage without love.


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## Gene01 (Jan 5, 2009)

Of course, you are right. I was quoting a song from a VERY old movie. You see, back when that movie was in theaters, we labored under the delusion that those two concepts were not ever mutually exclusive. 
It was truly a time for optimism….


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## Gene01 (Jan 5, 2009)

Chip, IMO no one is worth 30 million to play a game. But then, I don't own the business…and sports are a business.

I don't know how many folks would have health insurance if the CEO of Aetna were deprived of his compensation. And, I don't want to help him find out, either.

If someone commits a crime, prosecute that person. As of today (can't speak for the future), accepting one's compensation for doing the job for which they were hired isn't criminal.

Now, Madow (sp?) is a criminal. No different than a domestic terrorist or a rapist.


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## DanLyke (Feb 8, 2007)

I thought that there was a huge uproar from the Catholic Church, among others, when that song came out because it stated that marriage required love.

As for "whose fault is this?", what's your 401k invested in? We're all culpable to varying degrees. If you owned Aetna stock, especially indirectly, and didn't vote to put more fiscally conservative directors in place (and how many people actually research and return their voter proxy cards?) then you're part of that $300m salary. If you buy from the advertisers in the sports section, or watch a game on TV on a Sunday afternoon, you're part of that $30m salary.

We can't simply pawn this one off on "us vs them", we have to become more informed, invest locally, go to Little League games rather than Major League ones, and so forth.


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## Gene01 (Jan 5, 2009)

I didn't remember that, Dan. Don't doubt it, though. '58 was a looooong time ago.

You are right on with the rest of your post. I'd rather watch Little League ball, anyway.

Nevertheless, What would you have Steinbrenner do with his $$? Hoard it? I may be wrong but, I think his new stadium is the only one in the US not paid for wholly, or in part, with taxpayer $$


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## daltxguy (Sep 7, 2007)

Roman,

I think you should seriously consider getting that greenhouse. Maybe not buy one but cobble one together from found/recycled materials. Whether or not the current 'economy' ( ie: giant, debt-based ponzi scheme) recovers ( let's hope not, let's hope for an true economy based on real value), you can bet that with resources running out, money becoming scarce or worthless or both, that a local based economy and more self-reliance will have to prevail.

I'm not normally a doom and gloom guy but in my opinion the current happenings are the cracks in the shell of a giant system which was unsustainable and it will never/could never go back to what it was. It's going to take a while for us to believe that and adjust - may as well start now and be prepared.


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## kiwi1969 (Dec 22, 2008)

If you listen to the media you will end up like the dead German Billionaire. The "affuenza" epidemic will take many lives but those that have built their lives with other mens money will not be missed. Those that buy material posessions that they can neither afford or need on credit will find ancient truths bought home. Ask yourself if what you will lose is really worth having anyway and you may find it is not necessary for a happy life and you can part with it with a glad heart and no regrets. Did you really need that extra car or big screen tv? ask yourself. And as for freedom, if you are in debt from buying foolish toys, no amount of sacrificed soldiers will ever get you freedom. maybe Henry David Thoreau was right, I know I no longer live in fear of losing everything as i no longer have anything to lose. 
I leave you with this
"There is no dignity quite so impressive, and no independence quite so important, as living within your means" 
Calvin Coolidge


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## Russel (Aug 13, 2007)

Good point Dan. People get paid what we're willing to pay them and each of us has contributed to the expanding compensation. And, I've yet to meet anyone who when offered $30 million a year to be the boss would refuse it. Pretty much everyone wants what the rich have (can you say lottery?), so to blame those that have what we want sounds more like sour grapes than constructive thinking.


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## darryl (Jul 22, 2006)

Gene,
granted I am a Red Sox fan… but tax payers did indeed pay for the new yankee stadium.
as pulled from Wikipedia:
Days before leaving office in December 2001, New York City Mayor Rudy Giuliani announced "tentative agreements" for both the New York Yankees and New York Mets to build new stadiums. Of $1.6 billion sought for the stadiums, city and state taxpayers would pick up half the tab for construction, $800 million, along with $390 million on extra transportation.[6] The plan also called for forgiving $80,000 that the Mets owed the city in cable revenues and giving both teams an additional $25 million in planning money.[6] The plan also said that the teams would be allowed to keep all parking revenues, which state officials had already said they wanted to keep to compensate the state for building new garages for the teams.[7] The teams would keep 96% of ticket revenues and 100% of all other revenues, not pay sales tax or property tax on the stadiums, and would get low-cost electricity from New York state.[7] Business officials criticized the plan as giving too much money to successful teams with little reason to move to a different city.[7]


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## Gene01 (Jan 5, 2009)

Wonder if those "tentative agreements" became reality. Last week I saw a special on the stadium. The announcer sure was crowing about the "private funding". Finally, in an interview with some big wig in the organization, it was revealed that about half of the cost was a loan, amortized over 40 years. Possibly a loan from the city…state, among others??

It had to be true, I saw it on TV.


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## FEDSAWDAVE (Jan 1, 2009)

Oh No Darryl! NOT a Red Sox fan….

Sincerely, Tampa Bay Rays spanking LOL

Dave in St Pete


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## Betsy (Sep 25, 2007)

Just my two cents - and maybe this is simplistic, but they say unemployment is hovering around 8% - to me that means 92% of those who want to work are working. There's never a mention of all the homeowners out there who are not loosing their homes.

Where is the personal responsibility for the loans that people took out and can't pay? Yes, predatory lending is a terrible thing and a good salesman could sale ice to an Alaskan, but as the borrower you have to take responsibility for over buying or over extending yourself.

The same goes for businesses, and banks and governments. Take responsibility for your own actions.

I don't buy into all the gloom and doom. I can't in good conscious blame the banks or government for the mess we are in--everyone carries some responsibility for it. Maybe some have more responsibility than others-- but the blame can't be laid at one person/entities feet.

Just my two cents (which by the way - I spend freely).


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## Karson (May 9, 2006)

No comment! Ops, I made a comment!


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## mrtrim (Oct 11, 2007)

http://www.businessweek.com/lifestyle/content/dec2008/bw20081223_927689.htm


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## FEDSAWDAVE (Jan 1, 2009)

Barry, things….whatever "things" are….are not "hopeless" in Florida!

We are afterall, Florida…The Boomers…afterall are starting to retire….Buffalo and Cleveland…afterall are still Buffalo and Cleveland and ya don't want to retire in a place where it's like 19 degrees for 6 months! 70 degrees in beautiful Florida with plenty of affordable housing, cool ocean breezes, white sugar sand between your toes…golfing, sailing, fishing…as Bob Barker once said: COME ON DOWN!


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## FEDSAWDAVE (Jan 1, 2009)

Excuse me Barry I should have said: FLY ON DOWN !


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## Woodchuck1957 (Feb 4, 2008)

I think it's rediculous to defend some of the CEO's salaries, and then say the Unions are too greedy. Give me a freakin break.


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## FEDSAWDAVE (Jan 1, 2009)

I would agree Woodchuck that the Unions are not greedy.

Ignorantly unrealistic oxy-moronic doting xenophobes would perhaps better describe the state of todays union hack!

Florida: A Right to work state.


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## FEDSAWDAVE (Jan 1, 2009)

Barry,I would assume your parents are retired? My retired neighbors are all over any negative in the local fish wrap. Thats just the way it is. Has Florida suffered? Yes it has but WE ARE FLORIDA and people want to come here and they will! I'm a native…I love it…you will to so COME TO FLORIDA!

PS, I would not call it a "correction" just positive mind bending.


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## cpt_hammer (Dec 18, 2007)

What depression? We are no where near a depression. In fact, the statistics for unemployment and inflation were worse during the Carter administration. It was Ronald Reagan and George Bush Sr. that fixed the situation and then Clinton and the democratic congress screwed it up again and it only showed it's ugly face now. Clinton's fame road the backs of two great men. Bush Jr. several times amongst others tried to fix the things Clinton screwed up. But you can fix only so much before you are exhausted. Most economic policies take 4-8 years to feel the effects. Now with the new administration coming in and not having a clue about how economics works in the real world, we might not be in a depression now, but we will head towards one in the future. In the mean time, I'll be keeping my bible and guns close at hand and spending as I always have. Just keeping a closer watch on those I do business with. Diversification in funds and organizations. Those who invested all their money with Madoff were stupid. People make fun of people who kept their money in their mattress, but sometimes the mattress is the safest place. Maybe not for all of it, but some of it.


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## Michael121 (Jun 30, 2008)

Cpt_Hammer is correct. If Unions are not gready what are the JOB BANKS?

I would like to get paid for not working even when the place I worked does no longer exist. Just because in their contract they do not have to relocate. GM made the deals with those unions they are paying for it.

Ford is still going. They also own KingsFord Charcoal. They also did not get into huse financing like GMAC.

When Bill Gates makes a dollar it does not mean I lose a dollar. CEOs have contracts coming in. as do the Unions. Capitalism is make what you can. Socialism is make what they let you.

I prefer capitalism. Don't worry about what someone else makes worry about yourself. Class warfare is a waste of emotion. No poor homeless guy ever gave me a job.


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## dennis (Aug 3, 2006)

...and the sawdust fairy waved his magic push stick and we all turned to idiots…


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## roman (Sep 28, 2007)

dennis….....thats funny

nothing quite like the words

"your fired"

"I want a divorce"

and

"I'm an idiot"


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## roman (Sep 28, 2007)

if Obama had Reagens balls he'ld treat the unionized auto worker like previously unionized air traffic controllers….............and with a single swipe of the pen

fire the whole lot of them and send in the national guard

and then who wants to strike for what?

cause India wants your job too

and if you dont like that then give me one good reason why they should work for less then you do?

that my friends

is a fact we can no longer ignore.


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## roman (Sep 28, 2007)

I'm gonna bet that silence

is hard to find in the gaza strip!!!!!

after reading each and every opinion/comment/conclusion/debate/arguement…...................?

does anyone have a solution or a suggestion that isnt wearing glasses made in my rose garden?

Curious minds need to know

i


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## boboswin (May 23, 2007)

Here's a solution:

http://video.google.com/googleplayer.swf?docid=1954933468700958565&hl=es&fs=true


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## cpt_hammer (Dec 18, 2007)

Everyone always worries about outsourcing. The fact of the matter is that outsourcing often creates MORE jobs than it loses. It does however change the playing field and I think that is the hardest thing for America to understand. For us to remain competitive in a market where outsourcing is becoming more and more the norm, we have to improve our own education and seek the opportunities as they present themselves.

An example is this. You work at a phone center answering tech support calls for Dell. Dell pays $20/hour for 1 American employee or they can pay $20/week for an Indian employee. The cost for Dell just decreased by sevenfold. Which means the company is actually able to save a bunch of money. That money then can be used for increased marketing, research, integration, and other areas within the company and let the company focus on the core business of Dell, selling computers. Many of those positions are only available in America. However, it requires that the work force in the U.S. needs to be more educated and trained to perform new jobs/tasks. The risk comes is that India like China and several other countries are increasingly investing in EDUCATION. Those Indian employees someday will also be able to do the jobs that are in the United States.

The trick to remain a leader in the GLOBAL economy is to be better, faster, and smarter than your competitors. The economy is a constantly growing ball field with more and more players entering the field. Fortunately, that also means that there are also more consumers of goods and services as the third world countries will be able to afford more as their economy grows.

So what does this mean? We need to take advantage of outsourcing to provide cheaper, better products that DETRACT from our core business and expand our customer base to the larger audience which often leads to offering more and more options. It also means that if you don't want to lose your job, that you must EDUCATE and TRAIN yourself. Nobody is going to make you do it, you have to do it for yourself and your family.

So what as a woodworker do you do that detracts from your core business? For me it's the finishing/painting. I love the design and assembly part of the process, but I hate the finishing of the items. So I outsource it to my wife whenever I can. However, I've only been successful so far at outsourcing very little and it's only when it involves painting and no staining.


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## PKP (Dec 18, 2008)

Sorry, But I disagree with CPT hammer about outsourcing and this is why.
Have you ever bought a product and had trouble and call Customer Service and you cannot understand the CS rep. I have and I will bet that as outsourcing goes up quality and overall satisfaction goes down for the consumer.

Secondly, China has been poisoning our children & pets because of the outsourcing of the manufacturing of toys&petfood. I wouldn't say those are "better products" 
So I say as outsourcing goes up, consumer safety goes down.

Thirdly as outsourcing goes up the quality of the environment goes down for people in those countries.

I know everyone likes cheap prices at Wal-Mart, but it comes at a price.

Freetrade is not Free.


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## Woodchuck1957 (Feb 4, 2008)

Yeah, maybe we should outsource our goverment too huh ? No wonder this country is in the shape it is, you don't even want to support your own people in this country.


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## Chipncut (Aug 18, 2006)

My son, & his wife both lost their jobs at a call center that went to India.

Now there is a steel company from India that is investing 2 billion dollars in building a Taconite plant, & steel mill in this area, so things are making turn around.

Another thing about the banks. When my Son was in the process of buying a home, they told them he could afford one twice as much, but he didn't listen to them.

Too many people believe the banks.


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## CharlieM1958 (Nov 7, 2006)

That's what I meant by "predatory lenders" Dick. I had the same experience about 5 years ago when I sold my old house (paid for in full) and bought a new one. I was like "You want to lend me *how much*??!!"

As long as prices kept going up, the banks didn't care if you could afford the payments or not, because they knew they could still break even at least, even if they had to foreclose. Once all those ARM's kicked in and there was a flood of houses on the market from folks who could no longer make the payments, prices started dropping and the whole scam collapsed like a house of cards. (Not that I blame the banks 100%, because individuals should use a little common sense.)


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## Chipncut (Aug 18, 2006)

I think too many people where buying homes for an investment, rather than a place to live.


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## rtb (Mar 26, 2008)

Based on history there are several things that are going to happen, but first we have to understand the problem instead of focusing on the details and that is greed (everywhere). In time we will adjust and the economy will adjust. neither will be where we were but neither will be where it is now. and the government will continue to screw things up because of, you got it, greed. Want to change the government, fine, but not by force, and it can't be done at the ballot box, that's just a substitution process. It will take a majority, large majority, to support a new Constitution, that incorporates all of what we have now and clearly defines the role of government, payment of public officials, bans lobbying and many other things that can be brought to mind. and while we're at it lets tax all bonus's over say $5000 at 99.8%, we still have all this debt to pay off.


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## rtb (Mar 26, 2008)

And Roman, don't put the cart in front of the horse, but don't be stupid either. and don't sit up eorrying about it lifes to short and its not that important.


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## roman (Sep 28, 2007)

Dont ask me why, but the more the economy goes down the toilet, the busier I get. I've got booked commission work right into 2010…......touch wood!!!! I also have several clients who have told me that when I get slow, to call them as they have work for me too and lucky me….....they are willing to wait.

I bought an industrial wet tile saw this summer. ........couldnt believe the amount of money a "tiler" gets to do tile. The client asked me (i'ld done their kitchen 20 years ago) if I would do their floor tile. having been in the "reno" business for some time, I agreed, provided that the floor was preped as per my specs meaning all the floor joists had to have solid bridging on 2' centers, real plywood screwed down and into both bridging and joists on 6" centers, ..........etc. Job paid 5,500. Day one (with helper) cut and lay all the tile, day two grout, day three touch ups and seal…..........done…..............tilers make too much coin.

I truly believe that if you have a skill, talent, that cant be done elsewhere, where your good at it, where you dont charge a tonne of money (a small piece of pie is better then no pie at all), if you are tidy, on time, personable…............your going to stay busy. People have a fine way of pricing themselves right out of the market and yet others havent a clue what to charge,............and go bankrupt.

In the end…......................life will be better for everyone.


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## FEDSAWDAVE (Jan 1, 2009)

Amen roman. Amen !


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## roman (Sep 28, 2007)

I thinks its also good to be frugal. My parents saved money, aside from the house the mortgaged they didnt buy anything unless they could pay for it in full. My mother had a great big garden, she had fruit trees and just about everything we ate, was home made, home grown. I used to spend hours and hours squishing potato bugs…......thus the phrase "green thumb".

I raise my own chicken, have fresh eggs, and one huge garden to which we freeze, can, and cold storage in the cellar so we dont buy much. Even the meat comes from a farmer a 1/2 mile down the road. Too each his own and whatever floats your boat but I sure see a lot of farmers wives heading off to the market, no garden, nothing. ...............and the same ones whine about being poor.

How many men or women make more then enough to support several families, yet one of them has to be in real estate sales for their "pocket change" and the man or woman who really needs that real estate sale to feed their family…........doesnt get it.

also…...............I dont think its the politicians that are the problem, its the non fixable bureacracy thats the problem.


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## roman (Sep 28, 2007)

at the risk of a rant

I'm so sick of the desease thats called "entitled".

When I was a kid, if we wanted to play hockey, we packed our equipment up and walked down to the pond, the rink that some local parents put up at the park. If I wanted money I had to figure out a way to get it so I picked cherries and walked a few miles where there was traffic and sold them, I picked dew worms and sold them, I trapped wild rabbits and sold them, frog legs. I remember getting my first construction job and I remember asking my dad for a ride…...........he replied that if I couldnt walk there then I wasnt going to keep the job.

I was a competitive swimmer as a kid and my folks worked hard to pay for the coaching, the pool time. I swam up to 6 hours a day, everyday and I had to get my own ass to a pool that was 20 miles away, and then I had to get my own ass back to school.

I left my bike outside "once" and it got stolen. I never left the next one outside again cause I had to work for the first one and even harder for the second one.

30 years later

The kids here need a ride, a car ride, to go and visit the kid 500 yards down the road. They play hockey but only if they get a ride. They get a job but only if its in the city and only if it doesnt require getting their hands dirty. They argue about whos turn it is to fill the dishwasher. Their grades suck and some how they think its the universities fault they didnt get accepted. They never put their bike away cause they know that their "Daddy" will buy them another one. (note the kids that live here are not mine). They wont go snowboarding unless they have "the latest snow apparell". They have a to have shower four *&%$#@^ times a day. They ask for some help on a project, show up in my shop and then get a suck face going because I wont do it for them. One of them had a pool party here and ya, it was fun to watch them but I was rather appalled when one of the young boys threw a girls iPod into the pool and showed ZERO remorse because he knew damn well that his folks would buy her another.

My wife is a teacher and a darn good one. I cant beleive what some parents think and I wonder why the kid is a disrespectful little %$#@...............check out Mom and Dad.

Have you ever seen a %$#

```
$ kid without a cell phone jammed in their ear. When I was a kid we took string, lots of it, putit through a can at one end and a can at the other end and we really thought that we could talk over that string that was 500 yards long. the kids here text each through dinner because all of them have the "latest gadget", the latest &%$#
```
 digiatl camera and camcorder.

Dont get me wrong. The kids that live here for 2 weeks a month under my roof are good kids but they dont have a &%$#@&% clue as to how lucky, how fortunate, they are. I think that just about every kid, a lot of adults, should spend at least one month in a poor third world country, rubbing elbows with kids who make a living out the garbage dump thats full of the junk we sent them….............my kids did.


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## DrDirt (Feb 26, 2008)

Roman your last post really hits why I worry more about the future.
Seems now even the Psychologists are concerned - that after all these years of coddling kids. Having soccer games where no one keeps score and everyone gets a trophy, we have a whole generation that has never 'failed' at anything and had to recover and learn from mistakes.
The entitlement extends to the feeling that they are owed a job and should be promoted and get fat raises even if their work really sucks.
No kidding - a COLLEGE graduate in Electrical Engineering here got a poor performance rating and HIS MOTHER called HR to complain as to how 'unfair' it was to criticize her 23 year old little boy!

Outsourcing is a real problem for this country. the politicians who all talk about education and retraining are really full of S - - T! about the 'new high tech economy' and how those lost jobs are such opportunities.
Fact is our country needs a balance of jobs bottom to top. (Back to Entitlement) just because we encourage little johnny - the fact that he is in the 4th grade and can't tie his shoes is likely a good indicator that he is not going to be the next director of NASA.
Though a comedy line in Caddyshack - - when Ted Knight says 'Well - the world needs ditch diggers too' is really true. No matter what Dr. Spock wants to tell you - all kids are not equal some will be doctors, some scientists, some craftsmen some want mechanics and actually like getting dirty, and farmers etc. To say that whole segments of the economy are unimportant and we will just reeducate the workforce is garbage.

Seems like China has us by the short and curly's just doing those unimportant worthless jobs and we have a 10 Trillion debt and high unemployment.
As for high tech - keep in mind that in China - just the top 5% of kids(students) is more than ALL of the US students. So what are the opportunities for a "B" student here versus the Chinese and Indian top students here on a visa? If your job is in a cubicle - - it is on its way overseas!

The steel mill example is ONLY and investment here because of transportaion and raw materials….NOT because of thoughts of a superior workforce. Same with the Honda and Toyota plants in the US. Good cars no doubt but it always is a COST decision - of how much to just make it in the target market rather than shipping 7000 miles on a boat.


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## Gene01 (Jan 5, 2009)

Roman, your last three posts are right on the money.


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## FEDSAWDAVE (Jan 1, 2009)

"Faux finishes are out?"

I just knew I should not have attempted to corner the market on Faux sponge applicators!

BTW, seriously off subject, walnut oil is excellent in cooking from a cardiologists outlook.


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## FEDSAWDAVE (Jan 1, 2009)

I hear paint grade poplar is out…I could be wrong. 

EDIT: THIS JUST IN:

washingtonpost.com is reporting that Hannah Montanna tickets for your daughters are now OUT as well.

Thank God!


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## LeeinEdmonton (Aug 5, 2008)

My wife & I are not good for the economy….never have been. We have been mortgage free since 1974. Since then we have not financed anything….paid cash…period. Never buy anything on a whim, we either need it physically or emotionally or it's no buy. We use a credit card for convenience only & when the statement comes in pay the full amount. As a senior we do not have dental coverage. So what…pay when repairs are required. This past fall it was time to rework the yard into one requiring less maintenance. Cost 
$6400. So what…wrote a cheque…amen.
Not one cent invested in mutual funds. Why not ? Unwilling to have some twit (read trader) tell me what my retirement nest egg is worth. Finacial advisors' nope….these guys don't know anymore than you do or there would not be problems in the financial world today. 
CEO salaries ? Most CEO's worth their salt have their board of directors in their hip pocket & as long as the shares meet the expectations of financial analysits( who have been proven dummer than a sack of hammers)
the CEO's virtually dictate the size of their stock options. And that is where strange accounting practices began (World.com).
But lets not forget the part Gov't played in this. Interest rates. At one time the amount of interest rates were based on risk. The more risk…the more interest. Not so anymore. Instead most Governments of industrialised countries talk about core inflation. So what's core inflation. If company A was manufacturing a product in North American(high cost compared to China) then shut down in NA & outsourced to China, the Government looks at that & says costs has been reduced hence inflation has gone down. You & I however have to deal with REAL inflation….namely cost of living inflation. If you review your cost of living items there are few if any that have not doubled in cost over the past 10 years. Hence to do that real inflation has been running at or better that 6% per year for the last 10 years. When was the last time your Gov't fessed up & claimed inflation was running at 6% ?
There is no end in sight & won't be until Gov't is forced to face facts & stop lying to the voter.


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## dennis (Aug 3, 2006)

Interesting take on inflation Lee. If sure feels like I've been going backwards money wise. I know my medical bills have nothing to do with reality. A shopping cart of food is a now major part of my income.


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## LeeinEdmonton (Aug 5, 2008)

My problem Dennis is that I remember when…silly as it is….chocolate bars or a coke was 5 cents or more recently heat,light,water, telephone, totalled $30/mo. Gas was 33 cents a imperial gallon. A months groceries for 2 was nicely covered by $50. HOWEVER I also remember that during those times my monthly take home ranged from $250 to $600. A down payment on a house was min.10% & the house cost $14,000 & the mortgage could not exceed 27% of your monthly income. During those times inflation was measured on a basket of goods & services & was referred to as the cost of living. Hence it was an inflation figure based on what the consumer faced rather than what corporations deal with. Those same auto manufacturers getting handouts today , all through the 80's & 90's jacked vehicle prices at least once a year by 6% & sometimes a second increase during the same year…so they knew what the real inflation rate was irrespective of what your Treasury & our Bank of Canada was saying. Now here in Canada the push by Gov't on one hand is to save
while the Bank of Canada, with head in sand & a refusal to learn by experience continues to lower interest rates which was the cause to a very great degree for the mess we see today.
At least in your Country, the Gov't has reconized the importance of the savers & the place they can play in the recovery by increasing Depositor's insurance to $250,000 whereas here it is still capped at $100,000 which does little to enhance the saver's sense of security & not likely to increase consumerism even for those who currently can afford it.


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## boboswin (May 23, 2007)

The ultra wealthy are today demanding gold bullion rather than gold certificates and taking physical possesion of same.
The seems there is some strange difficulty arising out of being able to produce enough coin etc to meet the current demand.

????

Bob


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## SteveKorz (Mar 25, 2008)

I get a great deal of satisfaction out of being frugal. My wife is the same way. We buy some things that we don't need, don't get me wrong, but if she or I can salvage it or make it, recycle it, buy it used, etc, then that's what we do. My wife still cans vegetables (which are better than anything we can buy). She still sews to make blankets and fix our clothes. I still fix and make everything at home that I can. Our goal is for us is to be like Lee above, we're close to owning our mortgage and timber. We get all our cards paid off, and only use them just to pay them off for a credit rating. I hardly ever, ever carry a balance.

Despite our lack of reckless spending, we do still spend. There are a lot of really good points in this blog, the one that sticks out in my mind is Charlies point about the fear that the media puts in every single person in the nation. I get pretty tired of that.


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## juniorjock (Feb 3, 2008)

The media makes its living off of other peoples' misery…...........
-JJ


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## LeeinEdmonton (Aug 5, 2008)

Well Bob, the only problem with gold bullion is you can't eat it.LOL. It's like the guy who says "my house is worth $500,000". Only if someone will lay the money in your hand. Hence, when calculating your personal wealth…leave the house out of the equation & add it in only when someone lays the money in your palm. 
To give you insight to the smarts of our current Canadian Gov't. when stocks, bonds, mutual funds started their slide & the astute ones pulled out while still on the plus side….where did the money end up ???? Why in U.S. Treasury Bills because they are considered armor plated. Would you like to guess how much wealth left Canada ? I would'nt because the amount scares me. While all this is going on Harper & our finance minister were still singing "We are alright Jack" "our system is sound". You can't have that kind of wealth bleeding & still stay sound for very long. Anyhow…that's enough venting for now.


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## boboswin (May 23, 2007)

Lee, I think you're on to something.
It's hard to believe in people who have never balanced theur own finances to have the ability to protect ours.
I also note that every sector of the economy is downsizing except the Governments.

Bob


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## pommy (Apr 17, 2008)

Bob

we had a report on the news today that *HONDA* car plant in sunderland are* shutting for four months *and the union's are asking the british govornment to bail them out

i was sick that a far eastern company was asking our govornment for money

you don't hear of *china *or *japan* saying they are struggling with the global economy

andy


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## FEDSAWDAVE (Jan 1, 2009)

pommy, while I'm no economist…more a realist, both China and Japan are hurting. I was in China in July, they're hurting….because we're not buying. Tons of those construction projects the media is fond of showing are on hold. 
You think gas went to a $1.50 a gallon because America cut back? A billion + Chinese can have an effect on that as well.


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## GFYS (Nov 23, 2008)

come on people…we all knew it was coming for the last 40 years. I heard it predicted so many times. In 2000 and 2004 we heard how the presidential inauguration was such a huge waste of money…now that this president elect is spending 100% more…where is the outrage? SSDD


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## oldworld124 (Mar 2, 2008)

Bob #2,

I watched Hal Turner's video. He is speaking very clearly and truthfully about our dollar taking a dive. I have been going to Brazil for around 15 years. In 1995, Brazil had a tremendous devaluation of it's currency for the exact reasons Hal stated. The Brazilians were seeing completely out of control inflation. I watched bread increase on a daily basis. People were moving money around every day trying to keep what little they had left from disappearing completely. It was heart wrenching to see the average person going nuts trying to just put food on the table. The two main reasons for this massive devaluation of the currency was that the government had way too many employees. Who, by the way were and still are unionized. Massive government spending costs due to too many employees, the pension burden, and outright fraud. Brazil will suffer this again because they are a socialist, centralized government and are very corrupt. 
This is exactly what is happening here in the USA now. Extreme corruption has gutted our constitution and has put on this same path. My wife of 18 years, who is from Brazil, sees this coming and is quite concerned. It is sad to see this happen to was once a young and vibrant true Democracy.


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## boboswin (May 23, 2007)

John, you are right on the money with this one.

When you owe more money than you can produce goods and services to back up you get inflation.
The actual buying power of the money is what gives the borrowers an edge.
When they borrow a dollar that buys 10 loaves of bread it benefits them to pay back a dollar that only buys one half a loaf.
I can't see any administration anywhere not eyeing devaluation of the dollar as a solution to excessive debt.
All that means is that the population has to work that much harder.
As we all know the bureaucracy and at least the incumbent elected officials are* totally shielded from this with their "internal agreements" with themselves.*


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## Gene01 (Jan 5, 2009)

It's time for another tea party!


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## Chipncut (Aug 18, 2006)

*This is what bugs me!*

http://www.nwprogressive.org/weblog/2009/01/corporations-pay-no-taxes-get-federal.html


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## dennis (Aug 3, 2006)

Yes Dick it sure seems wrong to me!


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## Brad_Nailor (Jul 26, 2007)

Just another example of the rich getting richer and making sure the average guy stays average..

The whole bailout is BS if you ask me…we are giving money to the very people that created the crisis, and here they are taking our bailout money while they are busy hiding their profits in offshore accounts so they don't have to pay taxes…makes me sick. Oh ya, but of course all this is the fault of Carter and Clinton…the two Bush's' didn't have anything to do with it (snort). Thank god we are only one day away from that moron going back to kick tumbleweeds for a living, which I will be surprised if he even gets that right. I hope there is allot of buckle-brush at the ranch so maybe he will get lost in it and we will never have to hear from him again.


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## daltxguy (Sep 7, 2007)

btw, Dubya's ranch was just an act to make him look like a tough guy. Now that the presidency's over, they've sold the ranch and bought a McMansion in Dallas and the PR people are making him into a house husband so that he actually looks like a nice guy, so that history might judge him well. ( Good luck Karl Rove!)

But, hey, let's not forget that the US is a (supposed) democracy. People voted for George W and people voted for the people who created the laws that allows big banks to shelter money offshore. And don't believe that only banks are doing this, but nearly every corporation and many individuals - don't tell me that this is the first time you've heard of the Cayman Islands or Switzerland?!

So, it is up to you, the American voter, to change things…

You will have to hold Obama's feet to the fire because, quite frankly, he's already proving that he's running the same machine as before….he's planning on spending even more money. We've already seen with the Iraq war that when billions are being thrown about, corruption is about as commonplace among Americans as with Nigerians.

Take to the streets if you are outraged… how else do things change in America?


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## SteveKorz (Mar 25, 2008)

I just read today that Obama's inauguration party is going to cost us $150 million dollars, the most expensive ever. What the heck? He would impress me so much if he put that money back in the general fund and said, "Swear me in, I've got work to do."

Do you know how many people $150 million would feed?


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