Nordstrom is the Devil, right?

Indeed it has been a very interesting several days in America. The DOW recorded its biggest point drop in history on Monday, closing down 777 points. The presidential debate was less than exciting last Friday, and for the first time in my life, C-SPAN had a simulcast on all the major networks as the House of Representatives voted on a bill that would have made history. This story continues to unfold so stay tuned for the breakdown as it happens.

We would have loved to move on to a different topic by now, but this is what everyone is talking about and it just wouldn’t make sense to change the discussion in light of the economy dominating the news. Plus, it is important to weed through the facts and understand really why we are here and which candidate is best served to get us out of this mess and prevent something like this from happening again.

I will make one more point on the Nordstrom analogy before I move on. Perhaps I was a little too optimistic in my assertion that friendly CEO’s of large companies would pass on savings from tax relief on to you, the consumer. Silly me, greed and corruption does exist as well as a desire to help the rich get richer. While I could still argue that some companies would in fact pass on the savings to the consumer, I will concede the point that the likelihood of this specific instance of a trickle down is pretty slim. However- the theory of trickle up still fails to address the exact opposite effect. If you take the stance that CEO’s are only after the best interest of their shareholders- then guess what happens if you INCREASE their taxes? You can bet they will pass that increase onto your Tory Birch flats and Ed Hardy t-shirts, bad news for you- even worse news for the economy. If they do not offset their lost earnings, their earnings per share (EPS) would take a hit and their stock would lose value. As we saw Monday- American companies losing value is not good for anyone. I don’t care who you are or how much money you make, not good. Furthermore tax increases would lessen the incentive to expand domestically and continually reinvest in their American operations.

Aside from all that, we seem to be neglecting the point that these companies and these so called top 5% of America EARNED their endless wealth. Most of them are not trust fund babies and at some point actually worked hard to be at the top. Its sickening how much money they have, they don’t need it all, they can afford more taxes, hell they can afford to give away a big chunk of their money and still be filthy rich. But the underlying principle of capitalism is they should be the ones to make that decision, not the government. The notion that they have so much money so all the sudden middle class and poor people, are somehow entitled to it, is socialist. I would like to hear a counter argument that suggests the Robin Hood tax plan does not take us a step closer to socialist ideals. When we drift too far from this point and justify it by blaming the rich for our problems, we neglect what makes this country great and that is- everyone has the opportunity to be just as filthy rich. Now you can dismiss that because your job sucks or you have $320 bucks in your bank account, or you can seriously consider it as an option. Yes, even for you my dear blog reader. Go start a business, make it great, work hard, generate excitement and be among those 5%- hey maybe by you and a couple friends doing that, the percentage of the super rich will become 6%? :) Instead of sitting around looking for a handout from the people who actually did that, perhaps you can turn the tables and be one of those people. And maybe, just maybe, when you get to the top you will use your resources for good instead of greed. Help the poor out of the goodness of your heart, not out of a civil obligation to carry your weight. Reinvest in the country that helped make you great by providing jobs, serving communities and expanding your successful enterprise. Seriously- stop reading this blog and go do that. What is stopping you? Again, I would like to hear an argument calling me crazy on this one. There is no reason why every individual cannot be great in this country.

Besides- Fannie, Freddie are the root of our current problem…

While the problems we have are serious and historic, I would submit that it has very little to do with varying view on economic principles and our current tax code. It in fact has everything to do with Housing as I outlined in a previous post. Regardless of which way our economy has been “trickling” this crisis would have happened. I can promise you that. I personally think we should dedicate the next couple posts to Fannie and Freddie which is the real root of this problem. I am finishing up my research and will post my findings next- I think you will find most of what I will outline very surprising... Stay Tuned.