Wring in the New Year
Well, it’s the beginning of 2012 and we’ve been reading and talking about this year in virtually every capacity and category there appears to be. Frankly, this year’s conversations of final doom are rivaled only by the great computer date-rollover debate of Y2K. You remember that one, right?
So what will it be? Do we believe a rock tablet dug out of the rainforest predicting the end of the corn people? Or, are we inclined to look at our economic future with a cynical eye and wonder when and if we will finally recover; if “recover” is even the right word (hint and spoiler “it is not the right word”). Are these the days of the apocalypse or the days of the some miraculous halcyon beginning? Like most prognostications, the answer is more like a little from “column A” and a little from “column B”.
I’m going to make this short - a pleasant change from my previous writings, huh? Consider this a New Year’s gift from me to you. So unto the question at hand; are we in the last days or the first? Are we counting down on the Mayan calendar to utter doom or are we in the final throes of the most devastating economic meltdown in the history of the vast majority living today?
To address the first question is absolutely mandatory. Every generation since man first became man has believed that they were living in the end days. If you read the New Testament the writers and the readers were convinced that they were witnessing the final days. Surely they felt that way during the collapse of Rome, Bubonic plague, the Little Ice Age, World War I, The Great Dust Bowl, World War II and even Y2K. Have to do a shout out to my man Harold Camping who has not once, not twice, but thrice (look it up) predicted man’s demise. Yet, in every case we humans have muddled through and carried on. So is the myth of end times just that, a myth?
I don’t think so. If anything is consistent about the story of life it’s that to every season there is a beginning, a middle, and sadly, an end. I think we can all agree on two things; there will be an end and we are really, really bad at predicting when that end will come. So, for the purposes of this blog we will address the next year respectfully submitting that the Mayans meant something far different than the end of mankind. And, if the end comes, well, not enough people read this blog (2012 coincidentally but that’s including me at two different email addresses) that my words will come back to bite me that bad.
Show me the beef!
Does anyone remember Clara Peller’s raspy inquest? Well, for those reading who are television advertisement challenged, Clara’s friends were admiring a big fluffy bun when they lifted the top bun to reveal a miniscule patty evoking Clara’s wrath and the iconic phrase, “where’s the beef?” The ad was an enormous success for Wendy’s and entered American lexicon permanently when later that year Mondale leaned over when Gary Hart repeated his “new ideas” phrase to hear Mondale respond “where’s the beef?” Thus was born a phrase and a classic argument in politics. I hear what you’re saying about this latest blog...So where’s the beef?
Rabbit out of the Hat Trick
Think back and recall the first 100 days of Barack Obama’s presidency, when he muscled through a bill he called the “Stimulus Package”. He got that money, remember? He got three point four trillion dollars. I remember seeing graphs trying to explain to me what 3.4 trillion dollars looked like. Hey, I’m a working stiff - you don’t have to convince me it’s a lot of money. But what happened to all that money. You haven’t you seen much of that 3.4 trillion spread around, have you? No? I didn’t think so. As a matter of fact I don’t know anybody who can account for even a fraction of that money.
As the legend is told from Capitol Hill, that stimulus money, which we not only did not have but based on our famous “faith” economics, could not - even in our wildest dreams- possibly asseverate, was handed over to three or was it five major banks to be used to stimulate our battered economy nearly four years ago. So where’s the money? If the banks kept it and are not obligated to explain to the President what they did with it, we may be up a three trillion dollar creek without a proverbial paddle.
If on the other hand, as I strongly suspect, Obama has kept a big stash of that cash for right now, we are about to see the biggest rabbit pulled out of the hat trick ever played out in front of a barely alive global audience. I think Mr. Obama knew all along that he would need something extraordinary to renew a sagging presidency in his end days – he kept that money for exactly this moment in history. If I am wrong and he is not as bright as he appears then he has squandered the money or it never really had the value he thought it would. Either way, if there is no money for the rabbit in the hat trick we are in for a very, very bad 2012.
Year after year, fiscal quarter after fiscal quarter, we watch our hazy half-heartened government officials pull out their pink paint rollers and attempt to paint a rosy economic picture. Didn’t the White House tell us last year that unemployment had finally stabilized and we could count on the American economy to start a slow but steady recovery? That wasn’t quite true, was it? In fact in the last three years there have been 8 (count'em 8!) government presentations to different sub-committees promising that the great recession had ended and bright days lay just around the corner. And after three years, eight different studies, analyses and conclusions we are still sinking in the most toxic economic nightmare we have ever witnessed. If they said it eight times and meant it then they are very stupid. If they said it eight times and didn’t mean it, then they are very cold blooded. Either of those two options do not bode well for you and me.
Joblessness, homelessness and hopelessness -oh my!
The fact is that jobs have hit a low we can’t even compute any longer. Many people don’t realize that in the jobless count given to you by the government they do not list all the people who have simply run out of benefits. Nor do they mention the tens of thousands of independent contractors who are no longer working but never showed up on the unemployment ranks because they are not counted in those numbers. When housing went down it took with it all the ancillary businesses that support housing - and that’s just about everything in America. Years ago we got out of the “making it” business and into the “servicing it” business. We do not have the huge steel mills, car manufacturers or clothing factories – they’re gone.
I promised to keep this short so I won’t go into the whole history of American manufacturing, the Industrial Revolution and the shortsighted avarice of outsourcing in the last two decades. Let’s just say we are very much like a soldier who has long since fired his last round and now faces the enemy swinging wildly with the butt end of his rifle.
Clara eventually found the beef!
In a 1985 commercial Clara Peller, who made “where’s the beef” popular, sold the phrase out to Prego when she declared in their sauce she had finally found the beef. So what is it Mr. President? Have you found the beef?
I suspect Mr. Obama is as bright as he appears. My guess is we are about to ramp up from candle light to nuclear blindness – overnight and just in time for a re-election. Let’s say for the sake of argument that our newly minted president understood in 2008 that no one he knew (and he kept company with a rather intellectual bunch) the depth or constitution (no pun intended) of the economic misery we had stepped in when that mortgage bubble burst. And let’s further say that when he took office he had the wits about him to acquire that money not for some instantaneous and frivolous state funded fribble but to do exactly what he needed to get done – bring him a second term.
The Statue that blinks
If I am right we will suddenly see an influx of cash on a scale that will make the Statue of Liberty blink. The great and not so late President will turn out cash like a drunk on a spending spree. Remember Richard Pryor in Brewster’s Millions (forgettable maybe but ironically similar)? In Brewster’s Million’s Pryor has a set amount of time to give away a million dollars in order to inherit the equivalent of ten times that.
In this scenario Mister Obama has a few months to flood the economy with so much money that, unless you are deliberately nailed into a dungeon and buried under three feet of fresh cow dung refusing to work, there will be a job for you. Now I’m betting he doesn’t know or care whether this errant dump of feloniously acquired cash will start our economic engine but more to the fact it will get him re-elected. We have to put on our politician hat to understand a politician who can see no further than his or her next term. For the President the stakes of this gambit are ever greater.
So, if I am right. Be prepared to be dazzled. The next four months will see America come to life. If Obama is smart, the money gets invested in the small business engine which is the life blood of our economy. If he is in bed with big business, it will be consumed (inhaled like a junkie on a line of coke) by the greedy Fortune 500 who will promise him employment through his re-election. After that the jobs will dwindle away and the fortunes kept in the top offices of America’s most despicable CEO’s - a trillion to get us up and working and two trillion to keep their lifestyle when the money and the jobs evaporate like water in a shallow puddle on the Texas panhandle in mid- July.
If by err of heart, will of mind or blind luck it ends up in the hands of entrepreneurial America then, just by mistake, Mr. Obama may restart the American engine and slowly relight this darkened world. If he is like most politicians, he will do this with blind ambition or blind abandon but either way look for a good 2012 and 2013. If he decides that even though he can’t have a third term and wants for the good of all mankind saying “what the heck, let’s throw the peasants some cake” – then who knows - he might just become the most beloved President since FDR.
Either way…unless he’s blown the wad, it’s a going to be a good year…a very good year.
CEO, The Bosson Group
P.S. Sorry, Jaffe but I am a Christian first, an American second and a business guy third. So if you don't want to do business with my signature then I guess I don't need your business.