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2018-04-16 07:00 by Karl Denninger
in Federal Government , 123 references
[Comments enabled]  

Comment now folks; here is what I submitted. Comments close on April 23rd; get off your tush and do it today!

Please do not copy and paste this; "spam" comments are routinely ignored or rejected.  Instead, write your own.

"Marijuana" and its derivative products, in other words those derived from the plants of the genus Cannabis, should be de-scheduled under both United States and International drug conventions.

Their current scheduling under "Schedule I" in fact meets none of the criteria required for same.  These preparations are not "high" in abuse potential, they have known and recognized medical use, and an essentially-zero set of safety concerns, all of which are exactly the opposite of the criteria for such scheduling.

Known effective uses for these compounds include pain, various side effects of cancer treatments (including nausea, vomiting and appetite suppression), migrane headache and a number of seizure disorders, with the latter being especially potent in children with intractable epilepsy.  It is effective in reducing interocular pressure in glaucoma patients and there is evidence for effectiveness in several muscular-spasm and chronic inflammatory conditions, such as Crohn's disease.

In most of these cases the alternative therapies are ridiculously more expensive, less-effective or, in many cases, both.  Some alternative options, particularly for maladies involving pain, are extremely dangerous with severe addictive and overdose risks, such as the entire class of opioid compounds.  There is a developing body of evidence among marijuana-legal states that when marijuana is medically available opioid death rates fall to a significant degree. Ref:

Marijuana and its derivatives are also demonstrably safer on a scientific basis than either tobacco or alcohol, both of which are regulated yet not scheduled.  While smoking any substance comes with risks to one's health it is not necessary to smoke marijuana to consume it since controlled heating of extracted oils and other concentrates, or the consumption of foods prepared with it, is equally effective in delivering the active compounds.  Unlike both nicotine and ethanol there is no known LD-50 associated with marijuana and its extracts. Finally, while any substance that can bring pleasure to the consumer can be psychologically habit forming marijuana and its compounds have no physical addictive properties, again in contrast with both nicotine and ethanol -- both of which are highly and moderately physically addictive, respectively.

De-scheduling marijuana and its related compounds will not remove the capacity of nation states to regulate production, import, export and distribution.  Indeed doing so will bring "into the light of day" the production, import, export and distribution of these compounds, making possible enforcement of purity standards, detection and punishment for those who adulterate these substances and dramatically increase the medical research opportunities for same.

Marijuana and its derivatives, in short, meet none of the criteria to be classified under the existing scheduling system either nationally or internationally.

De-scheduling is not only appropriate under the criteria published for same to not do so would be to continue a gross public fraud and injustice.

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2018-04-15 07:00 by Karl Denninger
in Federal Government , 165 references
[Comments enabled]  

... make sure you lift a glass to Beelzebezos and Donald J Rump.

Amazon (AMZN.O) received a $137 million federal rebate on $5.4 billion in U.S. profits, resulting an effective tax rate of negative 2.5 percent, by using a tax break that allows companies to write off the value of executive stock options, according to ITEP.

That's right -- last year Amazon was paid by the US Treasury (that's you!) to operate.  They had a negative 2.5% tax rate; the government literally gave them $137 million dollars; they paid nothing in federal income tax.

And this was before Trump's tax cuts took effect.

This year?  They'll steal even more thanks to Trump and his "tax cut", sold to the people because, as he claimed, our taxes on corporations are too high.

Make sure you say thanks as all the stores and other retailers who actually do pay taxes are put out of business by a firm that the US Federal Government literally pays to screw retailers large and small.

PS: Yes, I know, you don't actually to file and pay until the 17th..... 

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So allegedly Trump "bought off" a standoff on DOJ nominees.

President Trump has promised a top Senate Republican that he will support congressional efforts to protect states that have legalized marijuana — defusing a months-long standoff between Sen. Cory Gardner and the administration over Justice Department nominees. 

In January, the Colorado Republican said he would block all DOJ nominations after Attorney General Jeff Sessions issued a memo that heightened the prospect of a federal marijuana crackdown in states that had legalized the substance. Gardner’s home state made recreational marijuana legal in 2014. 

But in a phone call late Wednesday, Trump told Gardner that despite the DOJ memo, the marijuana industry in Colorado won’t be targeted, the senator said in a statement Friday. Satisfied, the first-term senator is now backing down from his nominee blockade. 

Satisfied..... with a phone call?

C'mon Senator.  You know damn well that's unenforceable.

If Trump actually meant it then he could demand Sessions re-instate the Cole memo and get behind a bill (which, by the way, where is it Senator?) that would de-schedule Marijuana.

He has done neither.

Senator Cole, you actually could, perhaps, convince me to move from Florida to Colorado.  In the can I have a business opportunity that I've been working on for a while that's great for consumer energy efficiency and would likely create jobs -- and tax revenue.

I'm not going to market it here in Florida due to the outrageously unconstitutional actions taken by our Governor and legislature.  Indeed, that's enough for me to pull up stakes and move -- likely within the next year or so.

Before someone spouts off with "you just want to get stoned", well, if that was it I'd have moved a few years ago. It's not; my particular preference when it comes to recreational pharmaceuticals happens to run toward craft beer, and Colorado has a fair bit of that out there too (Three Barrels being a particularly nice micro-brewery and brewpub I recently visited.)

So where's the bill?  Now that, put on the table with a hard commitment from the President to support it which he publicly makes with the text of the bill is far more enforceable than a mere phone call.  Sure, you still can't make him keep to it, but a commitment that he'll sign the bill when it gets to his desk goes a long way.

Here's my proposed text, incidentally:

As of the signing of this legislation:

1. The drug commonly known as "marijuana", the plants of the genus Cannabis and products and preparations made from same are hereby removed and exempt from Federal Drug Scheduling under the Controlled Substances Act (21 USC Chapter 13, Sub1, Part B, Sec 812.) and 21 CFR 1308.

2. The specific reference to marijuana shall be removed from federal firearms regulation and law by specific mention, including on Form 4473 in question 11(e), rendering it no different than any other non-controlled substance.


Update: Probably need to add to the above --

(3) Federal laws or regulations, whether in statute, CFR or policy that are in conflict with (1) or (2) of the above are hereby superseded and void with respect to conduct that occurs within the States and Territories of The United States.

(4) Nothing in the foregoing shall constrain the enumerated Constitutional power in Article I, Section 8 of the US Constitution with regard to the importation or exportation of marijuana and its derivative products to and from other nations.

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Why aren't we talking about this?

 DatePublic DebtIntergovernmentalTotal
-09/30/201513,123,847,198,347.81 5,026,770,468,136.52 18,150,617,666,484.33
Purchasing Destruction 1,049,576,318,548.01373,250,728,904.451,422,827,047,452.46

Remember, the actual "public" deficit is the difference in borrowing between the end of the fiscal year and the beginning in debt held by the public.  The total increase in debt, including intergovernmental (mostly Social Security and Medicare) is the actual deficit and is exactly equal, on an arithmetic basis, to the destruction in your personal purchasing power that the government causes (or gain if the government runs a surplus.)

The actual deficit -- that is, the destruction in purchasing power the federal government caused last year, is the percentage of 1.423 trillion .vs. the total GDP of 18.450 trillion or approximately 7.7%.

That's right -- the government intentionally destroyed almost 8% of your paycheck and your savings last year, running a $1.423 trillion dollar budget deficit, which is roughly equal to the worst of the "great recession" when tax revenues went through the floor.

Today there is no such "tax shortfall" excuse. 

The breakdown of exactly where the ugly is coming from will be published next week.  I already know what is in there because I've been following the monthly treasury statements all fiscal year, but wish to report final "as tallied" facts -- and thus will have another post at that time.

Let me be clear: On the arithmetic if we do not stop this now within the next 4-5 years -- that is, within the next Presidential term -- our government will collapse, our economy will collapse, our health care system will collapse and both the stock and housing markets will collapse.  This is not politics, it's arithmetic.  And the worst part of it is that I am utterly certain that the "references" count, along with the "views" count on this article will both be a fraction of the politically-oriented articles I've recently posted.  That the real end of our way of life in America, a threat that is obvious, mathematically certain, not very far in the future and yet avoidable if we act now fails to garner any sort of serious attention is the real outrage folks.

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A bit of the piece I wrote before got my mind going..... I hadn't actually sat down to think about this much (other than when Bill Still was running for the Libertarian ticket), and I bet you haven't either.

But we should.

I'm going to take just our Federal budget and break it down into the following general categories for Fiscal 2013, a year for which we have the Federal Treasury Statement:

Social Security: $870 billion

Medicare and Medicaid (All): $1,113 billion

Children and Families (TANF, Energy, Children and Family Services, Adoption, etc): $50 billion

HUD (Rent, projects, operating funds, etc) + "Community Planning": $45 billion

SNAP/WIC/Etc (Food Stamps & "Free" School Lunches): $109 billion

Veterans Affairs: $143 billion, of which about $52 billion is medically-related.  The rest is (mostly) pensions and readjustment benefits.

Ok, now let's add all this up, with one exception -- Military Pensions.

I get $2,239 billion, or $2.2 trillion dollars, out of a total as spent of $4.058 trillion -- roughly 54%.

Note that the deficit was $680 billion, or one third of that spending.

So let's just take our $2,239 billion and see what we could do with it, assuming we didn't have these programs at all. In other words, let's make a few assumptions:

  • Families in the lowest quintile of income (under $27,794) pay an effective tax rate of zero.  That is, their income (all sources, including benefit checks from the government) is all theirs to spend.

  • Families in the second quintile of income ($49,788) pay few taxes, with an effective rate under 20%. That is, if we remove the taxes the gross amount they'd have to "make" would rise by about $10,000 (what they pay in taxes.)

  • There are an average of 3.12 persons per family.  Since the US population is approximately 330 million, there are approximately 100 million family units ranging from a single person to five (where the bell curve flattens to near-zero) persons.  As these are quintiles this happens to divide out nicely; there are approximately 20 million families in each quintile.

Ok, so we're going to do this instead of the programs we have now:

  • We're going to enforce the Sherman and Clayton Acts vigorously against all in the medical field.  This will result in the cost of medical care plummeting by approximately 80%.  Doubt me?  Go price procedures and drugs in Japan, India and other nations where you can get first world, cash care.  Or, for that matter, price a procedure at The Surgery Center of Oklahoma.

  • We're going to delete all of these programs and benefits outlined above.

  • For the 20 million family units in the second quintile, we're going to give each a tax credit amounting to the 1/5th of the ratable difference between their family income and the $49,788 threshold.  There is an approximately $22,000 range in this quintile so the average household will receive $2,000. That will cost $40 billion a year.
  • For the 40 million family units in the first and second quintile we're going to give each a further refundable tax credit amounting to 100% of the funds necessary to reach the 1st quintile threshold (average for the first quintile is $14,000 @ 20 million people) plus, for those under $40,000, another $5,000.  This will cost (20 million * 14,000) + (35 million * 5,000) or $455 billion more a year.

Note that these two direct refundable tax credit disbursements result in nobody having a family income of less than approximately $32,000 after tax.  We spent $495 billion doing it.

Bluntly: If we do this there are no more poor citizens in America unless you care to argue that a $32,000 household income is "poor."  If you do then I'll preempt your statement by telling you that you're stupid and ought to go find a high building and jump, you ****er.

End of discussion.

We started with $2,239 billion that we whacked out of the budget and have spent $495 billion of that eliminating, on a permanent basis, poverty in America.

We have left $1,744 billion each and every year.  We will not run a deficit ($680 billion) any more, and in fact will run a $400 billion surplus on purpose to start paying down the debt.  We now have $764 billion left each and every year.

That $764 billion is roughly 40% of the remaining federal budget.  We therefore will cut all taxes, income FICA, Medicare, everything -- by 30% so as to bring receipts in line with actual spending.

The result of this is:

  • A balanced Federal Budget right now and, over the space of a few decades, a zeroed Federal debt.
  • I did not touch the military budget, nor any of the other departments.
  • Those who are in the lowest quintile of American life suddenly and permanently have a reasonably middle-class lifestyle.  There is no longer any argument over whether someone will starve irrespective of their economic circumstance, other than by choice.  There are no more poor citizens in America.
  • I have permanently stopped all fiscally-driven inflation, and thus destruction of purchasing power, since there are no longer deficits being run.  In fact we now see purchasing power increases over time of about 2.3% annually.

  • Those who are in the second quintile will see their after tax income effectively rise to their pre-tax income.

  • And everyone, from poor on up, will see a 30% reduction in all federal taxes and fees.

Note that I left a hell of a lot of Socialism in the Federal Government due to handing out money to the lowest two quintiles.  However, I got rid of all of the government waste and corruption at once in social programs by doing it this way, and as a result what has happened is that the people in the lower economic strata got all the money instead of a quarter of it with the various scam artists in and around the government stealing the rest.

I also broke the Medical Monopolies -- everyone can now afford to pay cash for their medical care.

And, I did it while cutting taxes across-the-board by 30% while not only balancing the budget immediately, not in 10 or 20 years in some phantasm of lies and fraud, but also while putting $400 billion a year toward retiring the debt.

We're not short on money in this country, nor on taxation.

We're short on integrity and people who argue otherwise are liars.

Argue with my math; if I missed something or made an error, show me where.

PS: Before the criticism commences, let me point out that I'm well-aware of adverse selection and the arguments that can be raised in support of it, including the fact that were we to do this we might end up with a lot of people in that first quintile by choice!  After all, $32,000 as a guaranteed household income is pretty good for doing nothing!

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