Tell It To Al

As an official member of America’s vast middle class, I welcome President Obama’s pandering.

It’s high time he got back to his “I-love-the-middle-class” thing. After all, every voter is essentially middle class. America’s poor aren’t completely middle-class but they expect to be some day. And America’s rich often prefer the term, upper-middle class, so as not to sound so haughty. And then there’s everyone else in the middle-middle class.

During Obama’s first year in office, nothing much has changed for the middle class.

Foreclosures keep rising, unemployment is stuck at double-digit levels, credit remains tight, too-big-to-fail banks are even bigger and no more regulated, health care is still a disaster, and the economy, despite some nominal growth due to increased government spending, isn’t improving for most Americans. Meanwhile, the federal debt sky rockets and a larger tax burden looms for all of us.

I don’t object to those who want to blame George Bush for this. These problems were at least eight years in the making, and Obama really did inherit them. But Obama was also supposed to start fixing this mess, and the progress has been imperceptible to most of us.

It’s amazing how after Democrats lost a key Senate seat in Massachusetts, Obama is now turning up the “I’m-for-the-middle-class/working-man” rhetoric. Click here for the details in this Associated Press story.

It all sounds great to me. Obama’s State of the Union address on Wednesday will sound great to me, too. He is a great man and a great orator. And I am in the middle class. But where are the jobs?

Obama’s supporters are stilling holding out “hope” for “change.” And guess what happens to the Democrats next November if unemployment is still at 10%?

Can an imaginary horse save a home from foreclosure?

It’s a long shot, but so is trying to talk to a lender.

Banks, quite simply, are overwhelmed as more and more Americans default on their loans.

Another two million Americans are expected to face foreclosure this year on top of 1.8 million foreclosures last year.

More than 15 million Americans are upside down on their mortgages, meaning they owe more on their homes than they are worth.

Click here to read my column on Sarah Schrock, who has been battling foreclosure since last year.

Schrock’s best hope for a better life lies in a children’s book that she wrote and illustrated called “Hayseed’s First Race,” which will be published in April.

Click here to check out the Facebook page “Save Sally and Hayseed.”

They say that as January goes, so goes the year for the stock market.

The Dow Jones Industrial Average opened on Jan. 4 – the first trading day of the year – at 10,430. As I write this post, it’s now 10,543, down about 180 points on disappointing news from the banks.

Disappointing news from the banks? Go figure. Not enough has changed. The too-big-to-fail banks have only gotten bigger, and while they appear to be setting aside less for loan losses, their loan losses are still sizeable. And the mortgage foreclosure crisis that started this mess is raging on.

No Wall Street pattern universally holds true, but the year is sure off to a sideways start.

Not even the Democrat’s stunning loss in Massachusetts – and with it the prospect that expensive health care reforms could be stymied – is lifting the market today.

I made my stock market predictions for 2010 at the beginning of the month, not really committing, but predicting the market could hit 11,000 on the high, and perhaps even retest the lows of last year, falling below 6,500. (Click here to read my predictions.)

So far, January is suggesting it will do neither. “The January Effect,” the bullish trend that often drives the market as investors ante up at the beginning of the year, isn’t having any effect at all.

Any predictions on where the market will go this year?

Indiana leveraged-buyout artist Tim Durham is under investigation for running shell games with the many companies he controls.

He’s also under fire for selling his prized Dusenberg, similar to the one pictured left.

Court records show three different parties have a claim on this car in a convoluted series of claims.

Click here to read column.

Another month, another big media company announces a looming bankruptcy. This time it’s close to home for me as the owner of The Denver Post announces a prepackaged bankruptcy. I went over some of the details this morning on Denver’s 9News.

If you’ve ever been stuck in traffic, wondering if there’s a way through the clogged arteries of any city, the idea of a 39-inch-wide car might not sound so wacky.

The two-seat Tango was designed to allow drivers to lane-spit, which is legal in California and other parts of the world.

If everyone drove a Tango, the world’s highway capacity would double, said its creator Rick Woodbury, president of Commuter Cars Corp. of Spokane, Wash.

In addition to being, narrow, Woodbury boasts it’s the fastest car in traffic, able to go from zero to 60 in 4 seconds.

I found the Tango on display at the International Auto Show in Detroit.

Unfortunately, for now, the thin car has a fat price tag: $150,000. It’s a price Woodbury hopes to bring down through mass production some day.

Click here to read column.

Detroit bricklayer Dan Tollis protested against the auto industry bailouts last week in front of the motor city’s North American International Auto Show.

Tollis told me he’d lost his family masonry business, which did a lot of work with the automakers, and that’s sometimes the way business goes. He’s starting over, without a bailout and believes the auto makers should do the same.

Click here to read my column on Tollis and Miriam Pickens, who was protesting for just the opposite.

Pickens said she was retired after working in the auto industry for 30 years. She said that if it weren’t for the bailouts, Detroit have much worse unemployment than it has today, which some measures count at nearly 50%.

“We want a working city. Not a laid-off city,” she said.

Clearly our nation would now be even deeper in the muck were it not for bailouts of the auto industry, and the mortgage, banking and insurance industries as well.

But the problem with bailouts is that they reward failing business models and may only delay the inevitable.

Our nation’s business leaders preach about free-market capitalism and the evils of regulation as they follow each other over cliffs.

Then, when they’ve destroyed all they were charged to preserve, they go running to the government for a bailout. And then the government has to bail them out, because the consequences of not bailing them out are too horrible.

Depite all that’s happened, little about this system has changed. I’s not clear whether history will view bailouts as either necessary or wise. But for now, they’ve gotten us through what George Bush quaintly used to call “a rough patch.”

President Barack Obama is at it again, calling banks irresponsible, and threatening to hit them up with a new tax for the next 10 years.

“We want our money bank,” he declared, citing the “obscene bonuses” bankers paid themselves going into and coming out of the biggest banking crisis in generations.

So little has actually changed in the banking world. The too-big-to-fail banks are now even bigger. And the underlying problems of toxic debt, Byzantine securities, and record mortgage foreclosures continue. It makes you wonder if maybe Obama likes to chide the bankers in public, to appease the voters, but instantly becomes accomodating behind closed doors.

Many banks already have repaid their loans from the Troubled Asset Relief Fund, with profits to the U.S. Treasury. And the Federal Reservice Bank - which has been holding interest rates to record lows to keep the machinery lubed - recently reported its largest profits ever. Still, the wreckless behavior of our too-big-to-fail banks have helped rack up trillions in debt for the nation. And many of these banks would no longer exist were it not for taxpayer assistance.

Already, bank analysts are complaining that if the government taxes these banks, there will be even less money to lend. And of course whatever taxes banks have to pay simply get passed on in increased fees to consumers.

Consumers, however, are already getting sacked and lending remains tight. Additionally, our growing government is going to have to find increased reveneues from somewhere.

Banks - while worthy of Americans’ contempt - have great lobbists and will likely come out ahead before this latest proposal takes form. In the end, Congress and the President do not tell banks what to do. It’s the other way around.

General Motors Corp. Chairman Ed Whitacre says he’s got a plan to make the car company profitable again.

He’s just not telling anybody what it is.

Click here to read my column on my brief interlude with Whitacre at the North American International Auto Show in Detroit.