Your Money

Hold on

I’m not sure that this story has made much national news but President Obama used a process known as recess appointments to put 15 appointees in place that had been on hold. This is a procedure to go around the Senate’s ability to place a hold on an appointee. The 15 appointments is exactly the same as the number that George W. Bush had appointed using this procedure by this time in his first term so before anyone goes off on how scandalous this procedure is, there is precedence for it. My concern is that some of these appointments are being held up not because a given senator has a problem with the appointee but rather they are looking for some pork for their district. One such instance of this has Carl Levin asking for a decision on promoting a brigadier Army general to the rank of major general and David Vitter placing a hold on this change for the last 5 months because Vitter wants the Army Corps of Engineers to build three projects in his state. There was also a recent appointee that was held up by one Senator only to be unanimously approved when the hold was removed.

The last bipartisan act

Good news on the last bipartisan act also know as TARP. Citibank will be paying back money with $8 million in interest paid.

Government Mortgage Backed Securities program

Over the last year and a half the government, to stabilize the housing market and the economy in general, have been buying mortgage backed securities (bundled home mortgages). They have purchased $1.2 trillion of mortgages with annual interest payments of $50 billion. If the housing market continues to recover not only will the government make money off the interest but they will also make money off the sale of these securities.

GM Again

GM has been paying back the government loan that it received last year and expects to have it paid off by mid year 2011 with a profit for the government and a stable, more productive GM.

Private industry

One thing to keep in mind when discussing free market is that the corporation is not responsible to the public. Their only responsibility is to their shareholders. As such they will do what ever it takes to increase their numbers even it that is to the detriment of the public. On the other hand, the government is responsible to the public and the taxes we pay are to cover the public good. One example of serving the public good were the regulations in place on the banks known as Glass-Steagall The removal of regulations on the banking industry were one of the major reasons for the Great Recession. Below is another example of how too little regulation can have an affect on you.

The expensive "sheep's milk" cheese in a Manhattan market was really made from cow's milk. And a jar of "Sturgeon caviar" was, in fact, Mississippi paddlefish.
Some honey makers dilute their honey with sugar beets or corn syrup, their competitors say, but still market it as 100 percent pure at a premium price.
And last year, a Fairfax man was convicted of selling 10 million pounds of cheap, frozen catfish fillets from Vietnam as much more expensive grouper, red snapper and flounder. The fish was bought by national chain retailers, wholesalers and food service companies, and ended up on dinner plates across the country.
"Food fraud" has been documented in fruit juice, olive oil, spices, vinegar, wine, spirits and maple syrup, and appears to pose a significant problem in the seafood industry.