I guess not guarding the borders well will now be a whole lot more expensive than it used to be.  For every undocumented alien who gets into the U.S., the health care cost will just keep on going up.  I have to say that if I were thinking about moving back to the U.S. given the proposed coverage I would do it for that alone.

It used to be that being a citizen of the U.S. meant something, but I guess that now it does not.  I can hardly wait to hear what happens when they turn away veterans and people who are paying massive taxes because the services are being soaked up by those who are here illegally.  That should turn out to be an interesting sight.

I don’t know about you, but I think this is a terrible proposal that has been added to the plan.  Health care coverage was never supposed to be about taking care of everyone, it was about taking care of U.S. citizens who could not afford coverage.  If we do not know who is a citizen, that is a failure that must be fixed before we move forward.

It will be some trick if a  government sponsored national health care plan manages to survive without creating massive supply and demand distortions.  I’m still trying to figure out how my doctor, who I struggle to see when I need him, is going to take on twice as many patients as he now has and still provide me with a valuable service.  Most of the time I currently see his Physician’s Assistant or his Nurse, so if he doubles his load I will only bee seeing a medical tech of some kind.  I might as well just buy a good medical book.

I am also interested in knowing why my employer would be willing to continue to pay for my somewhat expensive health care coverage when he knows that I could at any time go on a much cheaper federal plan. 

As I have noted on this blog in the past, I’m not totally against changing the system that now exists.  I think the system is not being run in our best interest, how can it be when it is a puppet that belongs to big insurance companies?  Health care is one of those sacred areas where capitalism just shouldn’t be.  Do we need to make a buck on everything?  Years ago society left health care to health care providers.  Now it is run like a consulting business and you will find that, unless you are wealthy, you simply can’t afford those top shelf services that you may absolutely need.

A restructuring of the health care system is relatively easy.  Fix prices for services, and have the prices associated with hard costs . . not associated with lost profits as they are today.  Get the insurance companies out of the health care industry once and for all, but don’t substitute the government, that’s crazy.

So part of the question is, do you want to continue down the path that you are on, with private health insurance companies taking huge profits and increasing premiums to the point of absurdity, or should things change?

The war of words going on in the press today has pitted the greedy insurance companies against inept politicians.  The insurance company representatives, usually highly paid Doctors, keep telling us that the government will turn out to be worse than they are.  I think that is rich, don’t fall for government control of the health care system because they will screw you worse than we have . . great defense guys. 

While there are some individuals who are lucky enough to have lifetime coverage, most of us will hit a point where we can no longer afford it.  I have read that you need $ 200,000 to $ 300,000 in savings just to pay health insurance premiums if you want to retire.  That means if you are not one of the lucky few who have paid lifetime coverage or who can pay the discussed premiums from savings you will also suffer the same fate, health insurance cancellation.

Personally I don’t think the argument that doctors will leave the industry in droves because they won’t be able to get rich is a farce.  If you provided even a portion of the excess that is going to insurance company profits you could increase what doctors received, and then maybe they could make more decisions based on what is best for patients and not on what is best for the Big Bucks Insurance Company profits.

I hate to see more government intrusion into the health care market, but if you talk to people who think the government is there as a last resort to help them, for example veterans or helpless elderly individuals, you will find that they are shunned if they can’t pay monster premiums.  Many people are fooled into thinking that existing programs help people when the help is minimal or non-existent.

The question, do you need health insurance, can more easily be answered with a resounding no than an impossible to achieve coverage yes.  If you can see in the relatively short term future that health insurance premiums, that now cost a typical family at or above $ 8,000 per year, may become unaffordable.  Then there really isn’t much decision making with regard to the changes being presented.

I read an article by Martin D. Weiss, PhD entitled “California Collapsing” on the Internet, it is located at http://www.moneyandmarkets.com/california-collapsing-34271 and it is an eye opening report.  I knew there were some serious problems going on in the state but an 11.5% unemployment rate and a $ 24.3 billion dollar budget deficit were surprising numbers to discover.

With a mind numbing budget crisis, crushing debt, high unemployment, commercial real estate defaults increasing and a new wave of mortgage resets with 50% to 80% defaults likely in the home mortgage market, it is going to be a rough ride in the short-term future and in Dr. Weiss’s opinion there is ” a very HIGH probability that California will default.”

It has been my opinion that we would inflate our way out of our massive debt, but a default by a major state like California would solve their problem and possibly others much quicker.  Sure it would devastate a lot of people’s lives, but the government has already decided that a California bail out is not as important as the Wall Street bail outs since it has repeatedly turned California down flat after several requests for additional funds.

I have not been in favor of any bail-outs, so the near trillion dollars that was set aside for them has always seemed more than a bit unfair.  Many have asked, why bail out Wall Street and not states?  The default of a huge state government would bring with it an extremely bad precedent that may be followed by a number of smaller defaults.  I expect that the default of California would bring a number of other defaults, a virtual “house of cards,” that would be even worse for the general public than that which came from the Chrysler failure.

Nevada’s establishment of new Broker Price Opinion (BPO) rules that take effect on July 1, 2009 will allow about 20,000 real estate agents to express “price opinions” upon which decisions will be based by buyers, sellers, lienholders and third parties “making decisions or performing due diligence related to the potential listing, offering, sale, exchange, option, lease or acquisition price of a parcel of real property.”  In other words, for almost any purpose besides an application for a new loan.

One might ask, “are there any special qualifications required of an agent beyond the 1 or 2 weeks of real estate training required of agents for licensing to express such opinions?”  The answer would be no.  One might also ask, “is there any penalty for unqualified agents expressing opinions that are in error, and that may cost buyers, sellers, lienholders and others thousands or millions of dollars in losses?”  Again the answer would be no.

So what the Nevada State government has done with this law is allow the entry of thousands of untrained individuals into the valuation business at a time when valuing real property has become more difficult than it has been in the last 10 years.  Who exactly has this law been written to protect?

I have been a real estate broker for over 30 years and in 1991, after our country’s first financial fiasco with Savings & Loans, appraiser licensing was adopted based on a federal mandate.  The appraisal business has come a long way since then, and appraisers are so much better qualified than agents with regard to the valuation process that the professions have parted ways.  By allowing any real estate agent to act as a value expert is a giant leap backward.  

One wonders if this new law and its timing has anything to do with the fact that appraiser’s have not been willing to provide market value opinions high enough to support higher listings and the upward pressure on prices (see “Realtors Say Low Appraisals Sinking Deals“).

For those party’s buying “broker price opinion” products from real estate agents in Nevada, I guess the government has set up a situation for you where its “let the buyer beware.”  An army of unqualified real estate agents will be giving you a chance to purchase their opinion, but if it’s inaccurate you only have yourself to blame.

The liquidation of well over a million vehicles, in what has been a poor market for vehicle sales, will negatively impact Ford and foreign manufacturers.  Some have predicted that the sell off will cause massive layoffs as production is decreased, and that prices may increase on other vehicles in response to the disruption.

While no one knows just how bad things will get, it is clear that even under some of the most optomistic scenarios Michigan will be suffering over the next several years, and Michigan’s losses affect us all.  The black hole that will be created by primary and secondary job loss in Michigan will ripple through the State and adjoining states.  The job losses from the closure of hundreds of dealerships will hit many more states at a time when job retention is critical. 

There will be more waves in time as iron ore mining, steel, aluminum and parts manufacturing plants are hit.  Regardless of your ideology regarding the necessity for the market to allow such failures, expect the adjustment process will be painful for many.

It’s not like this psychology is new, this is a repeat of every downturn that I can remember.  The banks turn off the spigot when they smell risk.  It’s easier to make a few bucks safely than to put it on the street for a better return and lose the money.

Their are some private lenders of last resort out there, but the new practice is to ask borrowers for money before they can evaluate you for a loan.  That’s rich, you need money so the first thing they want you to do is pay them so that they can figure out if you are worthy enough to receive their loan.

The downward spiral kicks in when consumers who need loans to continue their business operation fail or commercial building owners cannot re-finance.  Banks want no part of buildings with high vacancy rates, so if you lost a real estate agent, a title company tenant and maybe an exercise business and can’t fill the space, you had better have holding power (deep pockets), because the bank is keeping their money.

So all that talk about getting more money on the street via the banks has turned out to be a joke.  If you give someone a million dollars and tell them to be generous with it, to make some loans and stimulate the economy, and all they did was send you bank statements that showed higher balances, you would probably be upset, right?  Well that is exactly what has happened with the banks, they took public money and hoarded it.  Many poorly managed their customer’s money when they had it, now they have become Scrooge with the bail-out funds.

It is my guess that this wave of dissent will evaporate if thing begin to return to normal, which is relatively unlikely.  What is more probable is that Tea Parties may be the infancy of a much larger dissent that could develop if thing become worse.  It appears that the President is about to attempt making radical  changes to the tax system, healthcare delivery and possibly to energy policy. 

I don’t know that anyone can predict what the outcome will be to these well intentioned changes, but if you are listening to the press, there is already talk about some individuals leaving the country to escape what may become (in their opinions) harsh, penalty-like income re-allocations. 

Change is a great mantra that may help you get elected, but few people may have understood what “change” entailed in the mind of the Democratic leadership.  If you are sure that you are on the wrong road you assume that another one has to be better, but that is not always the case.  I’m not saying that we went from the wrong road to another wrong road, but at this point I can’t see that the one that we are headed down is better.

One thing is for sure, change is never easy.  Another thing is for sure, if you protest what the government is doing loud enough you may become labelled as an aggitator subject to investigation or harrassment.  It’s not supposed to work that way, but guess what, nothing works the way that it is supposed to.

Looking to the short-term future its my opinion that a broad based backlash will continue to build as we deal with more economic turmoil.  Hopefully the economy will make the turn upward that most of us would like to see.  Will the turn be because of government intervention or despite it?

“Market Forces: The Future of the U.S. Dollar” in the Dismal Scientist by Alaistair Chan talks about China’s recent moves to suggest alternate reserve currencies, and China has already moved toward trading with some partners using Yuans.

The fact that faith in the dollar’s stability is under considerable scruitny overseas should tell you something about its future here in the states.  As India, Korea and others begin to dump dollars in light of our current policy to print mountains of cash, we may find that there are many dollars and no one wanting to hold them.

If the government wants to print another Trillion dollars because they created a new scheme that is based on a 1930’s law, that’s ok.  If they want to bail out the auto industruy a few time . . that sounds good, the airline industry, why not, we wouldn’t want them to go out of business, would we?

Fiscal responsibilty has become an oxymoron.  Its my opinion that U.S. citizens don’t really feel responsible for the debt that is being created.  They really were not part of the decision-making process that created the debt.  If people actually had to sign notes that said theywould repay the $ 118,000 per person, which I’m sure will increase to a significantly higher number in time, they would almost to a person refuse to sign the document, but as long as the government keeps swiping the charge card the bill will keep getting bigger, it becomes less likely that our currency and our way of life will survive.

1. Increase efficiency  -  fewer meetings, more computerization and less time off may be the answer to some profitability problems. 
2. Income and payments  -  need to be moved forward, not backward during a recession.  If you can change your policy and demand earlier payment for goods and services you could improve you financial situation. 
3. Reduce expenses – there are lots of ways to cut the cost of operations from giving fewer perks to using off-brand ink in your printers.  When things slow its important to everything that you can to keep your numbers in balance.
4. Downsizing staff  -  when times are tight you have to keep staff expenses down, and that may mean that the managers or owners actually work.  It’s nice to  
5. Downsizing office  -  you can usually survive in your business if the expenses become small enough.  With the exception of staff, office space is the largest expense for many business, and negotiating a rent reduction, moving to a smaller space or going virtual may be something that will get you through.  If you don’t need the space that you are in, try to make an adjustment rather that paying dearly for it.
6. Restrict travel  -  its another relatively high cost that is often not necessary for business survival. 
7. Borrowing less  -  is common sense.  Since many business already can’t borrow, this is a no brainer.  With the government ramping up the availability of dollars, however it will be difficult to pass on a loan in the future, but it makes more sense to pass on the money if you can.
8. Bankruptcy  -  may be your last option.  A Chapter 13 reorganization could give you a chance to pull your struggling business through the bad times.  I have heard that all the bankruptcy Trustee has to hear from you is that you were in a hard hit industry, like real estate, and there is not much more that you have to explain. 

For some it’s all about getting through the slow times to the other side.