Month: March 2023

The collapse of the Silicon Valley Bank (SVB) on March 10 took a surprising twist. (Note: The Signature Bank also failed.)

Almost everyone in the nation knows that if you have money in a bank, and it fails, the Federal Deposit Insurance Corporation (FDIC) insures your deposits up to $250,000 (for a married couple it is $500,000). Very few of us have that much cash in a bank. Since most bank accounts are covered by that limit, we weren’t concerned for the depositors in SVB.

But surprise, surprise. SVB (and Signature) had wealthy depositors with huge cash balances; only about 8% of the money in the SVB accounts was covered by FDIC. Some of the SVB deposits were by millionaires in China.

We learned that not only are those depositors wealthy, they are big donors to Democrats. And it is Democrats in Congress and President Biden who are largely responsible for the collapse. As I explained last week, the banks failed because they held near-zero interest bonds. Since January 2022, interest rates jumped, which was caused by high inflation starting in 2021, which was caused by an excessive $5,000,000,000 in federal spending.

So, did these wealthy Democrat donors admit, “Well, it’s my fault so I’ll accept my losses and make a better decision next time?” NO! They called President Biden and demanded that he bail them out! And he did.

President Biden proudly announced that all deposits in SVB and Signature, not just ones under $250,000, would be paid in full. And he emphasized, “no losses associated with the resolution of (the banks) will be borne by the taxpayer.”

So, where will that money come from, if not from taxpayers? The FDIC. The FDIC maintains a balance funded by fees paid by all banks. However, the FDIC reports their “Insurance Fund” has less than half of the $262 billion that might be needed. The additional funds for the bailout will come from higher fees forced on the 4,150 banks that did not fail. Since almost everyone with a bank account is a taxpayer, Mr. President, it is the taxpayers who will bail out the wealthy depositors, including the Chinese.

The “surprising twist” is that the wealthy depositors lose nothing, and you and I pay the price for their mistakes. It should be the other way around.

To be fair, the President and Treasury Secretary Yellen have a responsibility to calm the nation and prevent a run on all the banks. But hinting that ALL bank deposits would be covered by the federal government creates a major hazard. Bank officials, with no responsibility to properly manage their clients’ funds, could make reckless loans based on social and environmental beliefs while denying loans to solid businesses. This could end up like the student loan debacle. When the government took over from the banks, students got loans regardless of the prospects of paying back the money.

Back to the Silicon Valley Bank… Why wasn’t the Federal Reserve alert to the pending collapse? Maybe it was because the CEO of SVB is also on the Board of the Federal Reserve Bank in San Francisco. Wow. SVB even fooled Forbes Media and others into giving them an excellent rating.

President Biden emphatically announced the bank officers would be fired because they failed. Can he do that to a private entity? On the other hand, there are several officials under his direct control that he should fire because they failed. I won’t name any, but you know who they are, including Cabinet Secretaries.

Meanwhile, on Tuesday, former president Donald Trump reportedly will be handcuffed and tossed in jail by the Prosecuting Attorney in New York City. The charge is that he wrote a few checks totaling $130,000 in 2016 to quiet an extortion attempt by Stormy Daniels, the once favorite client of attorney, Michael Avenatti.

At the same time, in Washington a Congressional committee reports that bank records show President Biden and his family received a million dollars in a questionable payment from Chinese Communists. And, there are a dozen similar bank transactions under investigation. Financial information found on Hunter Biden’s computer adds to the intrigue.

As possible court cases work through the judicial system over the next several months, Las Vegas will take bets on whether Trump and Biden will be sharing a Presidential Debate stage, or a cell.

Historic quotes by Will Rogers:

(Speech to the American Bankers Association, 1923) “You have a fine organization. I understand you have ten thousand here… and if you count the ones in the various federal prisons, it brings your total membership up to around thirty thousand.”

“See where Congress passed a two-billion-dollar bill to relieve bankers’ mistakes… You can always count on us helping those who have lost part of their fortune.” DT #1715, Jan. 22, 1932

“If a Bank fails in China, they behead the men at the head of it that was responsible. If one fails over here, we write the men up in the Magazines (praising them).” WA #217, Feb. 6, 1927

Did you see the Budget for Fiscal Year 2024 submitted by President Biden? He wants to spend $6,700,000,000 and raise a slew of taxes. It is more of a political ad for Democrats than a budget because the Republican House will never approve it.

But suppose Democrats were still in control of Congress, and this budget passed. Low-income folks and maybe half of middle-income earners would be cheering, “Yes, make the rich and corporations pay their fair share!”

However, the wild applause would end in a few months. Instead of the mild Recession we now seem to be entering, raising these taxes would dump the economy into a full-blown Depression. Companies would raise prices, reduce worker benefits, and lay off employees to compensate for lower net income. The wealthy would pull back, reducing their investments in stocks. The stock market would go down. The result would cut the value of retirement accounts. And shockingly, because big investors would have fewer capital gains (and more capital losses), in a year or two, federal tax receipts would decrease instead of increase.

But Democrats are not in control of Congress. So, most of the proposed tax increases will be voted down or only increased slightly. The top 1% of wage earners already pay 42% of income taxes, so it’s hard to claim they don’t pay their fair share. (The bottom 50% pay only 2.3% of federal income taxes according to the IRS.) What we need is more people working and paying taxes.

Most people know that Social Security and Medicare are going to run short of money in 10 or 12 years if nothing is done. I’ve heard that Social Security checks would have to be cut by a fourth for all retirees. Medicare payments would also be cut.

So, except for minor increases in taxes to support Medicare, President Biden and Democrats in Congress offer no plan to solve this long-term problem. They ignore it, except to criticize anyone who dares to make a reasonable suggestion, such as increasing the age for Social Security eligibility slowly to age 70 or 72. Workers are living 15 years longer than when the retirement age of 65 was set for Social Security in 1935.

What is the President’s reaction to another long-term problem, global warming? It is the opposite to Social Security and Medicare. To paraphrase the President, “I’m going to cut all fossil fuels. No more oil or natural gas pipelines. No more drilling on federal land or offshore. Electric vehicles are here and now. No gasoline powered vehicles can be manufactured after 2030.”

The result is the supply of energy from fossil fuel is being squeezed (meaning higher prices) and billions of tax dollars are being spent on solar and wind energy, Electric Vehicle subsidies, and 50,000 charging stations. Americans are paying higher prices and more taxes to solve a problem that may not have any substantial economic impacts for at least 50 years.

And it’s called “global warming,” not “USA warming.” Our contribution to global warming is only 15%. If we eliminated ALL fossil fuels here, the global impact would be minimal because China and India are the major contributors. Despite claims by our Secretary of Energy, China shows no intention to reduce global warming. They continue to build coal-burning power plants and import natural gas and oil.

Working on long-term national problems should always be a priority for the President and Congress. Unfortunately, politics determines which ones are essential and skews the proposed solutions.

The failure of the Silicon Valley Bank is directly connected to Democrat policies. The bank invested heavily in government bonds when the interest rates were near zero. Because of excessive federal spending since 2020, inflation went up. To get inflation below 7%, the Federal Reserve was compelled to raise interest rates to about 5%, which dramatically lowered the value of the bonds. When depositors started to withdraw their money, the bank was forced to sell bonds at a loss, resulting in failure.

Historic quote by Will Rogers:

          “The budget is a mythical bean bag. Congress votes mythical beans into it and then tries to reach in and pull real beans out.” DT #2047, Feb. 24, 1933

The FBI and a scientific research agency in the Department of Energy confirmed that Covid-19 came from the Wuhan Lab. Finally!

For 3 years, the Chinese Communist leaders, the World Health Organization (WHO), and Dr. Fauci insisted that Covid-19 came from a bat. They belittled anyone who suggested that perhaps it had come from the Wuhan Lab where advanced research was being conducted on the virus.

Do you remember the first time you heard that Covid-19 might have originated in a virology lab in Wuhan, China? For you, it was probably in March or April 2020 when Virology experts not connected with the Federal government suggested the possibility. But our mass media quickly quashed opinions that disagreed with Dr. Fauci and the CDC.

A year later, in May 2021, Fox News reported the Wuhan Lab was likely Ground Zero for Covid. And now, March 2023, top scientists in the FBI and DOE concluded that Covid had to come from the Wuhan Lab.

Of course, the Chinese Communists refused to allow anyone to investigate at the Wuhan Lab. A few scientists at the Wuhan Lab got sick in late 2019. The virus (officially SARS-CoV-2) was discovered in December 2019, which is why it is called Covid-19. Knowing the virus was transmitted person to person, the Chinese took action to try to protect their own citizens. But they did nothing to keep it from spreading to Europe and the United States. (Some claim that was intentional.)

More than a million Americans have died with Covid. And almost seven million worldwide. Almost everyone has lost a relative or friend to Covid. Millions more have been hospitalized or continue to have lingering effects. Our lives were disrupted like never before. Covid changed the outcome of the 2020 election.

Unrelated to Covid, many of our big cities are spending money in ways that defy common sense. Here are two examples from New York City.

The city council is spending $5,000,000 to install 5 toilets for the convenience of tourists. Yes, a million each. For political purposes, each borough will receive one. The one in Manhattan should be placed in Times Square. On New Year’s Eve, with a million people congregated, waiting for hours for the ball to drop, you may not get your turn ‘till February.

And did you hear that New York City is awarding a total of $5,000,000 as a result of the violent protests in the summer of 2020? You probably remember the scenes on television of police cars being burned, protesters throwing bottles and rocks at police, and stores being broken into, ransacked, and burned. So, in gratitude for their dedicated service, NYC will give $21,000 to each police officer who bravely stood up to the rioters.

What? The police won’t get $21,000 each? Then who does get it?

The $21,000 is for each of the rioters. Can you imagine anything nuttier?

Mayor Adams is likely to get several letters like this one, “Mr. Mayor, you don’t know me, but I’m one of the peaceful protesters in 2020. I smashed a window at Macy’s, ran in and grabbed a fur coat and a dozen diamond rings. I really need the $21,000 because I only got $500 when I fenced the rings.”

Well, that’s $10,000,000 in taxpayer funds the New York City politicians are flushing down the sewer.

Historic quotes by Will Rogers:

      “Well, as I go to press, everybody is on a trip somewhere if they work for the government. I wonder when the taxpayers take their trip.” WA# 30, July 8, 1923

      “It seems the whole idea of Communism, or whatever they want to call it, is based on propaganda and blood.  Their whole life and thought is to convince somebody else…  The Communist has so many good things he just wants you to join in and help him use some of them.” Saturday Evening Post, Aug. 21, 1926