A controversial list of cuts proposed by Obama's debt panel hopes to cut about $4 trillion from the U.S. deficit over the next 10 years. The report for cuts is uncompromising in that both sides the left will not like the spending cuts and the right will be unfavorable to revenue increases.
The $4 trillion dollar cut would come from a majority of spending cuts while the other will come from a reduction of tax breaks. The report basically says that this country can't afford to spend more than it takes in. Something that most households already knows but somehow the federal government doesn't seem to grasp this concept.
In order for the commission to make the official recommendations to Congress, the panel of 18 members would need 14 members to approve it. Currently, the panel only has 7 yes votes. It is expected that the commission will fail to generate the necessary votes to submit the recommendations to Congress. This is another example of wasted money and time in the federal government.
Today, President Obama will be meeting with small business owners in New Jersey. Owners of New Jersey LLCs and New Jersey Corporations of the smaller variety are set to meet with Obama to discuss the President's initiative to free up business credit for small businesses. If you look around, most people are employed by small businesses, small businesses make this economy go round, sure big corporations do play a part in the economy also, but small business is what drives it. Small business owners often forget about the outside world and focus on their business alone, but it's also important to read up on bills set to be passed, whenever there's an election, it's also important that you vote, because the laws that pass could affect your business.
Consumer spending is on the rise and paints a good picture of a recovering economy down the road. Retail sales rose in April which marked the seventh straight increase. Consumer spending is closely watched because it accounts for roughly two thirds of the U.S. economy. Indications that consumers are spending again bode well for the economy as a whole.
Factories are also showing signs of hope as well. Factories are increase production to meet the demands of consumers. More and more companies are starting to hire again as evidences by one of the best gob growth numbers in years. Analysts are still cautioning that there is still uncertainty in the economy. Hopes for a recovery is still dependent on jobs growth and wage increases to keep the economy going foward.
The economy as a whole appears to be recoving. The bleeding appears to be over. Other sectors are seeing gains. The auto industry is improving marked by profit reports from Toyota, who has been under enormous scrutiny for all its prodcut defects. Also, the housing market is showing signs of recovery. Most of the major metropolitan areas are showing gains.
The economy isn't out of the woods yet. Although the jobs growth has been great, the unemployment rate is staying high because more people are not back to searching for jobs. The economy has a long way to go for recovery but it appears that it is on the right track.
The Securities and Exchange Commission today laid down fraud charges to Goldman Sachs for fraud associated with the subprime lending disaster. The SEC filed a civil lawsuit against Goldman Sachs for fraudulent activity associated with collateralized debt obligations. As a result of these subprime loans, Goldman Sachs in essence created the bubble in the housing industry which later burst when people couldn't afford their loans when the economy went sour. Goldmen denies any wrongdoing in the suit. In a statement released by Goldman Sachs, "The SEC's charges are completely unfounded in law and fact, and we will vigorously contest them and defend the firm and its reputation,", the company stated.
Goldman Sachs and Lehman Bros were the first of two biggest banking institutions that collapsed due to the banking crisis. Goldman Sachs was one of the recipients of the banking bailout funded by taxpayer money. It has since emerged stronger than ever and is reporting healthy profits again. However, shocked by the charges, shares of Goldman Sachs tumbled as much as 16% but recovered by the end of the day to be down only 11%.
Due to the banking crisis, President Obama has initiated steps to prevent such an envirnoment that could lead to another banking disaster. President Obama issued a statement saying that he would veto any overhaul to financial regulations that doesn't include rules on the derivates market.