Daily Readings 09-14-2012
How Quantitative Easing Helps the Rich and Soaks the Rest of Us
Quantitative easing—a fancy term for the Federal Reserve buying securities from predefined financial institutions, such as their investments in federal debt or mortgages—is fundamentally a regressive redistribution program that has been boosting wealth for those already engaged in the financial sector or those who already own homes, but passing little along to the rest of the economy. It is a primary driver of income inequality formed by crony capitalism. And it is hurting prospects for economic growth down the road by promoting malinvestments in the economy.
The Fed Launches QE3: Winners and Losers
Here’s a quick run-through of some of the possible implications of the Fed decision:
The Obama administration has engineered a “recovery” in name only.
Job creation: Where are the startups?
An American entrepreneur has zero tax or regulatory burden when hiring a consultant/contractor who resides abroad. But that same employer is subject to paperwork, taxation, and possible IRS harassment if employing U.S.-based contractors.
Hidden Chobani Billionaire Emerges as Greek Yogurt Soars - Another immigrant who managed to become one of the evil rich…
A shuttered plant, a small business loan and Americans’ growing taste for Greek-style yogurt combined to make 40-year-old Turkish immigrant Hamdi Ulukaya a billionaire.
Chobani, the best-selling yogurt brand in the U.S., has given Ulukaya a net worth of $1.1 billion, according to the Bloomberg Billionaires Index. He is founder and sole owner of Chobani Inc., whose sales have quintupled since 2009, and has never appeared on an international wealth ranking.
Franchisors warn Obamacare will halve profits
Barr has 23 stores with 421 employees, 109 of whom are full-time. Of those, he provides 30 with health insurance. Barr said he pays 81 percent of their Blue Cross Blue Shield policy, or $4,073 of $5,028 for individuals, more for families, for a total bill of $129,000 a year. Employees pay $995.
Under Obamacare, however, he will have to provide health insurance for all 109 full-time workers, a cost of $444,000, or two and half times more than his current costs. That $315,000 increase is equal to just over half his annual profit, after expenses, or 1.5 percent of sales. As a result, he said, “I’m not paying $444,000.”
Providing no insurance would result in a federal fine of $158,000, $29,000 more than he now spends but the lowest cost possible under the Obamacare law.
Government Employees Work Less than Private-Sector Employees
The stereotype of the underworked government employee is frequently invoked in criticisms of public-sector employment. But does the average public employee really work less than the average private employee? To provide an objective answer, this paper uses the American Time Use Survey, which produces a detailed listing of personal activities on a given day for each respondent. Based on this dataset, government employees work around three fewer hours per week and roughly one less month per year than private-sector workers. Substantial differences in work time persist even after controlling for occupational and skill differences between sectors. The underworked government employee should be of concern to taxpayers who expect private-sector levels of work in the public sector in exchange for private-sector levels of compensation.
Microsoft: Malware preloaded on PC production lines in China
Several new computers in a Chinese factory were found to have been infected with malware which was installed there, according to a study by Microsoft. This helped the company obtain a United States court order giving it permission to tackle the network of hijacked computers infected with the Nitol malware.
More Americans opting out of banking system
Daily Readings 09-14-2012,In the aftermath of one of the worst recessions in history, more Americans have limited or no interaction with banks, instead relying on check cashers and payday lenders to manage their finances, according to a new federal report.
