News

Diversity, Inclusion, and Equity

Posted on by boom booms room staff

The Wall Street Journal reached out yesterday.  They asked us to comment on rumors that boomboomsroom.com, aka BBR, was contemplating going public.  We directly squashed the rumor.  We have no plans to IPO now nor in the future.

Our rationale is simple.  We want our sole focus on delivering the best content day in and day out.  To do so we need to hire the best people to do their best at the job that they are qualified to do.  Our deep and talented staff shakes it’s collective head at the daily outcry for diversity, equity, and inclusion in the workplace.  Don’t misread our position.   We are all for all people, regardless of race, sexual orientation, gender, gender identity, religion, or whatever group we forgot, to succeed in the business workplace.  We just think that the best/most qualified should be the final determination.

When did hiring the best and most qualified go out of style?  It’s when political correctness became the style.  It’s when capitalism was first assaulted by socialism.

Take Uber. The newly public company released on Monday its latest diversity report, which included a breakdown of its US workforce by race or ethnicity and gender. White men still make up most of its staff (30.1%), a pattern that is even more evident in leadership, tech, and leadership in tech roles. Black women make up 5.3% of its overall workforce in the US, black men 4%, Hispanic women 3.7% and Hispanic men 4.6%.

Diversity is defined as each person is unique.  And, each person may have a different point of view that should be considered.  It certainly can be due to different upbringing, background, education, race, ethnicity, etc.  But, it’s about each individual.

For the first time, Uber is setting some diversity and inclusion goals for 2022 that will be tied to the compensation of several of its senior executives — CEO Dara Khosrowshahi, chief financial officer Nelson Chai, chief legal officer Tony West, and chief people officer Nikki Krishnamurthy.  Chief People Officer!  What the hell?
Want to guess what percent of the US 2018 census best estimate of the American population is white and male?  It’s 37%.  Should they focus on hiring more white men?  It would be equitable, but not politically correct.
“While these numbers are an improvement, they are not where they need to be,” wrote Megan Rose Dickey of the Tech Crunch website.   Project Include’s Ellen Pao has previously said the numbers need to be at 13% black and 17% Latino in order to reflect the demographics of the U.S. population.   So, employee demographics need to match our population.  If everyone is employed (nearly the case right now) don’t they in the macro?
So, how do you get there?  Ah.  What isn’t being said is that nearly 33% of the Uber employees are of Asian decent.  So, is that good or bad?   Aren’t Asians a minority too?  Of course they are.  Every race is except white.  But apparently there are too many of them working at Uber for Megan and Ellen.  How else can you say it?  If you need to have more blacks and Latinos you must need less Asians.  Isn’t that racist?  Isn’t that prejudiced?
NBA Commissioner Adam Silver said in May that his league had done a poor job hiring females as referees.   Currently there are three female officials in the NBA, and he wants that number to rise.  “The goal is going forward, it should be roughly 50-50 of new officials entering in the league,” he said. “Same for coaches, by the way. We have a program, too. There’s no reason why women shouldn’t be coaching men’s basketball.”  Sounds politically correct.  Except, maybe they don’t want to referee in the NBA?
Someone should ask Adam how many female refs applied for the job in the last twelve months.  If it was way more than the three that they have whose fault is it that they only have three?  It’s the NBA’s.  If the number that applied is way less than men, how do you fix that?  Should you even try to fix that?
And, most of all, someone should ask Adam why there is such an imbalance in the league’s players. According to racial equality activist Richard Lapchick, the NBA in 2015 (the most recent info we could find) was composed of 74.4 percent black players, 23.3 percent white players, 1.8 percent Latino players of any race, and 0.2 percent Asian players.  If I were an Asian Uber employee I might declare my eligibility for the 2020 NBA draft.
Diverse?  Sure.  Inclusive?  Yes.  Equitable?  No.   The most qualified?  For sure.  Ah, now we are getting somewhere.

No Consensus on the Census

Posted on by boom booms room staff

So, in today’s America, we cannot come to a consensus on the census.  Why not?  President Trump and his Attorney General are at odds with Congressional Democrats and a few Obama appointed judges over the right to ask a basic question on the 2020 census.  The question is “are you a US citizen?”

That leads to another very basic question, “why?”  Why would those opposed to the question of citizenship on the census be opposed to it?  And, that leads to yet another question, “why was it taken off of the census questionnaire to begin with?”

The answer to why the opposition to the question itself seems rooted deep in the Democratic Party strategy doctrine.   They would prefer the word “residents” these days over citizens.  It sounds so much more inclusive you know.   Remember  “illegal aliens” morphed to “illegal immigrants.”  Then it softened to “migrants.”  Soon migrants became “undocumented.”  There are even “dreamers.”  Doesn’t “dreamer” sound so much better than “illegal?”  How can you be opposed to dreaming?  Join our party.

Way back in 1974 a lower court’s ruling on Roe v. Wade was upheld by the United States Supreme Court.  The result made a woman’s right to have an abortion legal.  A woman’s right to have an abortion morphed into a woman’s “right to choose.”  Choose what?  You know.  So, it was still too descriptive.  So, it is now referred to by the left as “woman’s healthcare.”  It’s headed to “woman’s wellness.”  Doesn’t “wellness” sound so much better than “abortion?”  How can you be opposed to wellness?  Join our party.

If you count “residents” isn’t the next step to count them in on all things that “citizens” rights provide.   Free healthcare was just approved in California for illegals aged 19-25.  Why stop there?  You can start by redrawing the congressional districts around residents.  And, when you do the party that panders to the illegal immigrants in every which way gains more votes.  More votes means gaining and holding power.  Why do you need an ID to vote anyway?  Come one, come all.  The party that panders dreams about the dreamers putting them in power permanently.  And, make no mistake about it, the Democratic party has a vision and a strategic plan and does a great job marketing itself to achieve it.

So, why and when was it taken off of the census to begin with?  It was taken off by the Obama Administration after the 2010 census.  When you count citizens you also count non citizens don’t you know?  It’s better if your opponents do not know the size of the opportunity (if you are from the left) or the problem (if you are from the right).  The question has been on every census, taken once a decade, for over 160 years.  When it was removed the hope was that it would never be placed back on it.

At a minimum it takes a fight to get it back on.  And who looks bad in the fight in the eyes of the press?  It’s the folks that call illegals illegal.  It isn’t the former president and his agenda.  He was trying to be inclusive.  So the narrative has shifted.  The press writes and talks about “why does the president want this on?”  The press doesn’t or didn’t ever question why the former president took it off.  So the right siders have to play defense.

President Trump comments often about how important it is to finish building the wall that previous administrations started.  It might seem easy now compared to building a consensus around the census.  Of course if you had the wall you would need no census consensus.

 

 

 

 

 

 

Border Fireworks Make For Good TV

Posted on by boom booms room staff

Happy Fourth of July!  Happy Independence Day!

Independence?  What exactly is that?  Merriam Webster defines it as “the state of independent.”  Independent is defined as “not requiring or relying on others (as for care or livelihood).” It’s also defined as “showing a desire for freedom.”

Two hundred and forty three years ago tomorrow America declared it’s desire for freedom.  And two hundred and forty three years later we have a crisis at several entry points into our fifty United States on our southern border.  It seems that the desire for freedom from those in other countries has outstripped the supply of well meaning people (border control, government workers,and volunteers) to manage the situation.  Managing it is very tricky of course.  There is the attempt to stop illegal entry, and the attempt to process those caught, and the process of housing them while they are being processed.

Apparently this crisis wasn’t a crisis though when President Trump called it just that as 2018 turned to 2019.  Back then the press and Democrats in positions of congressional leadership said that there is no such thing.  Well, well, well.  A funny thing happened from then until now.  It’s a democratic process unto itself, and a way every four years that we take advantage of our rights that the very freedom provides.  It’s the election process.

And, with that process comes the opportunity to express opinions and outrage over problems and opportunities the nation over.  So, the non crisis is now a crisis.  Ask any Democrat running for office.  Each in the last week or so has expressed disbelief and outrage over the governments failure to adequately house the immigrants and care for the children caught in the fray.   One even shrieked that the compound had run out of toothpaste.  Oh yea, and it’s better to call them “undocumented” than illegal, too.

We’ll start investigations into it as soon as next week.   Congress is very good at that.  They investigate, castigate, and threaten to jail wrong doers.   They remind those drug in to testify that they are under oath.  The truth must be told!

The problem is that the truth was told and it has been told over and over.   Those crossing are doing so illegally.  They have swamped the border and have been for many months now.  But, now, elections are near.  TV time is expensive.

But, but, but.  What if a candidate can get a hungry and gullible press member or 50 of them to follow their every step?  They can walk right up to the fences (cages as the outraged has called them) and lament about how bad a job America is doing. Those “cages” were built several years ago under the Obama administration for all of the right reasons.  It was one part of an attempt to control an out of control border situation.  Then President Obama spoke into TV cameras and said, “don’t come here and don’t send your children here alone.”  He continued,” If you do, you’ll be sent back.”   It made sense then.  It makes sense now.

Record numbers are attempting to get into the country that the party out of the White House tells you how many wrongs exist in it.

You might spend time in a “cage” and you might have forgotten your toothpaste.  But, it must not be such a bad place after all.  People are climbing over walls in record numbers to get here.   Just don’t turn on your TV till after November 2020.  It seems that a few folks have a different opinion.  It’s another freedom.  Freedom of speech.

Enjoy the baseball and the fireworks.  And, please pass the hot dogs and apple pie this way.

 

 

Record Highs On Early Trading/Early Close Tomorrow

Posted on by Jim Carlton

Independent Investment Management designed to protect and grow your wealth.

JIM CARLTON
Managing Director
Chief Investment Officer

Friends

As expected, it was a very quiet day of trading. Stocks were
able to squeak out a small gain by the close, but volume was light and
volatility was muted. We do have the ADP private payroll jobs number tomorrow, and
the non-farm payroll number on Friday, so that might add a little spice to the
situation before the end of the week.

For the day, the Dow Jones Industrial was up 69 points to
close at 26,786. The S&P 500 was up 8 points to finish the day at 2,973. Gold
was up $27 to trade at $1,416 per ounce, while oil was down $2.72 to trade at
$56.37 per barrel WTI.

With 4th of July on Thursday, the markets close
early tomorrow at 12:00 noon our time- so we will be closing the office early. We’ll
let you know if anything happens during the shortened trading session tomorrow
before heading out for the day.

Have a nice evening everyone.

Jim

10200 Grogan’s Mill Road, Suite 340
The Woodlands, TX  77380 
(281) 298-2700 Phone
(877) 824-4299 Toll Free
(281) 298-2760 Fax

info@chjwealthmanagement.com        www.chjwealthmanagement.com

Investment Advisory offered through Carlton, Hofferkamp & Jenks Wealth Management, LLC (“CHJ”).

*Numbers and figures sourced from the following: Bloomberg.com, CNBC.com and Finance.Yahoo.com.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly.

CHJ Wealth Management,
10200 Grogan’s Mill Road,
Suite 340
The Woodlands, TX 77380

I’ll Scratch Your Back

Posted on by boom booms room staff

Did you get paid yesterday?  It’s very likely that you did.  It was the end of the month.   You always and only get paid for what you have earned.  Paychecks are remuneration for the past.  Joe Biden likely got paid as well, and twice if he takes Social Security.   His checks come from the US Government.  They are a federal government pension plan check and Social Security check.  He earned them over his many years of civil service to our country based on how the system is set up.

But, he is learning rapidly, recently, that there isn’t too much civil about our country today.  And, he is learning rapidly that past performance doesn’t guarantee future results.  You have to earn it.   And, he is learning that how the system works today has little to do with how it was set up “back in the day.”

Back in the day Ronald Reagan invited Speaker of the House Tip O’Neill, an old curmudgeon, old school Democrat from Bahhhstan, down the hill for an occasional tip o’ the cup of the whiskey of his choice.  Together they would iron out their differences (compromise) as the ice was melting and get to a position where both felt good bringing back a deal to their respective parties.  And, both thought that America had won.

Even as recently as 2011, President Obama was caught on a hot mic as leaned over and told Russian Dmitry Medvedev to give him time to get reelected and he could work out a deal with them.  Medvedev promised to relay the info to Putin.  You can see it here.

So, maybe it surprised Sleepy Joe when Kamala Harris took him to the woodshed last week on the nationally televised debate over his “working relationship” with known segregationists in Congress a couple of decades back.  It shouldn’t have.  He already told us that he got that past behaviors don’t translate to today’s world or political climate.  “I get it, I get it,” he said.  You can see him explain that over and over here.

We even had the left leaning media over the weekend tell us how bad, or reckless, or unprepared President Trump was in reaching out to Kim Jung Un unexpectedly while he was in Japan for an impromptu stroll on the communist land of North Korea.

You remember “hold your friends close and your enemies closer,” don’t you?  Apparently, embraces of any sort with friend or foe are now old school.

The new school seems to be that there is only one way.  And, when a party with power decides on a path it expects all to toe the line, no exceptions, no negotiations.  So, we wonder, is Joe Biden someone who can operate in the new world order?

And, most of all, does he want to earn his way?  His demeanor daily and debate disaster last week scream otherwise.

In fact, wasn’t his time to strike when he was VP to the two term, popular President Barrack Obama?  History shows that VP’s run immediately after whom they serve under can run no longer.  Biden deferred to Hillary Clinton for some reason.  Maybe he was tired even back then.  As many commercials remind us, the aging process waits for no one.  Four years later, Joe is four years older.

Obama came from left field to win, then win again.  Trump came from right field to win, and might win again.  Biden looks and sounds more like McCain, Romney, Hillary, and Jeb Bush than his fellow Democratic nominee hopefuls.   It’s way too early to predict, but the country is in a very different place.

And, there is no back to scratch nor whiskey to pour anymore.

Get some rest Joe.

 

 

Stocks Top Off A Great First Half

Posted on by Jim Carlton

Independent Investment Management designed to protect and grow your wealth.

JIM CARLTON
Managing Director
Chief Investment Officer

Friends

The bulls were content to sit on their gains as the quarter
came to a close today. Market participants will be keeping an eye on
developments coming out of the G20 meetings over the weekend, but as we look into
the second half of the year (can you believe that?), the bulls have some
headwinds to navigate, not the least of which could be a developing earnings
recession.

As for today, by the close the Dow Jones Industrial Average
was up 72 points to finish the day at 26,599. The S&P 500 was up 16 points
to close at 2,941. Gold was up $1 to trade at $1,413 per ounce, while oil was
down $1.44 to trade at $57.99 per barrel WTI.

It was a very good first half of the year for the bulls. As
mentioned, many challenges lie ahead as we enter the second half of the year.
We’ll know what transpired on the China trade front when we fire things up on
Monday, and then we’ll begin to look ahead to the upcoming corporate earnings
season. Trade, corporate earnings, a jobs report and inflation numbers will all
be considered when the FOMC meets in late July. Expectations are that the Fed
will cut rates at that meeting, but that remains to be seen. Let’s first enjoy
the gains from the first half of the year.

Have a great weekend everyone.

Jim

10200 Grogan’s Mill Road, Suite 340
The Woodlands, TX  77380 
(281) 298-2700 Phone
(877) 824-4299 Toll Free
(281) 298-2760 Fax

info@chjwealthmanagement.com        www.chjwealthmanagement.com

Investment Advisory offered through Carlton, Hofferkamp & Jenks Wealth Management, LLC (“CHJ”).

*Numbers and figures sourced from the following: Bloomberg.com, CNBC.com and Finance.Yahoo.com.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly.

CHJ Wealth Management,
10200 Grogan’s Mill Road,
Suite 340
The Woodlands, TX 77380

Ten Piece Nuggets-Debating the Debate

Posted on by boom booms room staff

Round two of two of the first Democratic Presidential Debates went round and around last evening.  Below are ten nuggets for you consumption that cover thoughts on both days with an emphasis on last evening.  Some nuggets are heavy.  Some are light.  All are spiced just right.

  1.  For better or worse, the Democratic Party’s center is now further left than ever.  When the ten hopefuls were asked last evening to raise their hands if their healthcare plans included free medical care for “undocumented” immigrants, ten of ten hands were raised.  Joe Biden looked to his left and right and then figured it was a good idea to follow the crowd.
  2. Sleepy Joe took shots across the bow from Sanders, Stalwell, and Harris.  Three times he was given thirty seconds by one of the five MSNBC moderators to retort.  In none of the three did old Joe seem prepared.  Twice he stopped in mid sentence and said, ” I see that my time is up.”  One wonders, after last evening, if indeed Joe’s time is up.
  3. Right after the debates when the candidates and their “spin handlers” look for microphones to continue driving home what they stand for, Biden spent time talking to a few supporters from the crowd.  When he finally did answer two questions from an unidentified reporter he was somewhat awkwardly pulled away by his wife.  He said something half audible as he left the mic that sounded like, “that’s my wife and I need to go.”  Agreed.
  4. This morning’s New York Post front page has a picture of the ten hands being raised by the candidates answering the medical question above.  The bolded font headline rephrased the question as “Who Wants to Lose the Election?”  Did we mention that the party’s center has shifted left?
  5. Kamala Harris’ shot at Biden stemmed from his resistance decades ago to support school busing to eliminate segregation.  She dramatically used her upbringing in the moment explaining that as a second grader she was in the first generation of that very heated time in America, and what it meant to her.  Clearly she had prepped very well for the moment and delivered her consternation at him flawlessly.  She was kind enough to say that she didn’t believe he was a racist all the while pummeling his legislative past.  Biden looked like he needed smelling salts and a standing eight count from the moderators.
  6.  Winning in debates can mean a lot of things to a lot of candidates.  For example, former HUD Secretary Julian Castro, an evening prior, went from “who?” to “that one impressed me, let me hear more.”  On to round two he goes.  Ditto for Tulsi Gabbard.  On to round two she goes.  For entrepreneur Andrew Yang, it meant advancing his thought of offering $1,000 to each family each month for a cool cost of $3.2 trillion dollars.  He did this while wearing no tie to the proceedings, and speaking for a grand total of three minutes of the 120 minute debate.  A man of few words, afterwards he had no comment on where Yin was.  In to the round file he goes.
  7. But, the clear winner in BBR’s eyes and ears over the last two nights was Senator Kamala Harris.  She commanded the stage with two men to her right (Bernie and Joe) that had way more experience on a stage as big as this.  Her command of the spoken word is darn good, with pauses and inflection interspersed at the right time and in proper doses.  In short, she looks capable of being in it for the long run.
  8.  Mayor Pete Buttigieg certainly held his own.  When he speaks he brings logic and sincerity along for the taking. His answer to the police shooting mess (regardless of how you see the matter) his South Bend town is in was well crafted given the low ceiling.   It’s a really crowded field.  And, at 37, he is short on experience in public service and private employment.   But, given where Obama and Trump came from and where they landed, the White House, the mayor’s campaign will be interesting to watch.  Maybe he’s a 2024 or 2028 guy.
  9. BBR looks forward to the next round when hopefully the money has dried up on half of the field so that real debating can begin.  MSNBC tossed plenty of softballs at plenty of beer league players.  It’s time to go to the next level.  After all, someone needs to ask the field how these candidates intend to pay for all of these promises.  Free healthcare, free college, free community college, college debt forgiveness, unlimited immigration, and a free chicken in every pot sounds quite expensive.  Bernie might already be shaking a tin cup as commuters arrive on Wall St. this AM.
  10. It’s awfully early to predict.  However, an avid reader of BBR put $100 on Donald Trump to win the GOP nomination three years ago at 17-1 when The Donald was still nicknaming Jeb Bush as Low Energy and Marco Rubio as Lil’.  It’s great money if you have that kind of vision.  We don’t know what Kamala Harris’ odds on gaining the nomination are at this moment.  But, we suspect Vegas lowered them a good bit after last night.   They should.  Polls aside, she looks like the one galloping to the front to us.

Get some rest Joe.

 

 

Lefty and Shorty Debate the Debate.

Posted on by boom booms room staff

If Lefty and Shorty were still with us their early morning banter might have gone like this.

Lefty and Shorty sat quietly in the still, humid, summer night air.  It was after 2 AM on their graveyard shift and cars were nowhere to be found.  Lefty- Why did we stay open 24 hours Shorty?  Shorty- So that we can discuss how the first of two Democratic Party debates went last evening.  It was a graveyard for many nominee hopefuls.

Lefty sat to the left of Shorty.  Imagine that.  Shorty sat on the shorter of the two “halves” of the 55 gallon drum. Imagine that.  Each were cut down to size and retrofitted with a soft cushion top.

Lefty- So you watched the two hour debate?  Shorty- Most of it.  I was flipping back and forth with the Commodores.

Lefty- What do you mean?  You were watching an old school concert, too?  Shorty- No.  The Vanderbilt Commodores won the NCAA Baseball National Championship.   Lefty– Oh.  OK.  I guess two straight hours with ten wanna be’s is indeed taxing.  Shorty– Don’t bring up taxing.  I heard it enough last night.  And, “straight” is an insensitive word.

Lefty- What did you think of the MSNBC and NBC broadcast?  Shorty- It was fine except when they had technical difficulties and had to cut away.  That was weird.  Lefty- The hot mics went cold and the cold mics ran hot.  Shorty-Climate change?  Lefty- Oh please.  Shorty- Was it the Russian interference they have all been talking about for two years?  Lefty-Oh please.  Shorty-Maybe Nadler can add it to his list of questions for the July 17 Mueller testimony.

Lefty- Ahem.  So what did you think of the polling leader in this first group, Elizabeth Warren?  Shorty- Well, at least when she spoke she did so in her native (American) tongue.  Lefty- Huh?  Shorty- Well Beto and Booker decided to spend half of their ten minutes of fame practicing their Rosetta Stone Spanish.  Lefty-It was televised on Telemundo as well.  Shorty– Don’t they have closed captioned translating English to Spanish?

Lefty- Good grief.  Moving on, how about Ohio Rep Tim Ryan?  Shorty- If Tim Ryan fell in a forest and no one heard it, would it be sound?  Lefty- This is going well. Shorty-Saving Rep Ryan isn’t coming to a theater near you soon.  Lefty- Did you like any performance?  Shorty- I thought NY Mayor Bill DeBlasio stood tall.  Lefty- Interesting.  Shorty- He must be at least six foot four, and he proved that he is no paper straw man.

Lefty- Former Maryland Rep John Delaney seemed reasonable.  Shorty- He did.  He just looks too much like Tim Conway.  Dorf on debate.  Lefty- You’re irascible Shorty.  Shorty- At least I don’t look and sound angry about everything like Booker.

Lefty- Did anyone do well through your jaundiced eyes?  Shorty- Former HUD Secretary Julian Castro did.  Lefty– Finally some progress.  Shorty- Progressive.

Lefty- How did Washington Governor Jay Inslee do?  Shorty- Who?  Lefty- I guess not so well. Shorty– Was he the one near the far right end of the stage that kept raising his hand?  Lefty- That’s him!  Shorty-  He must have wanted to be excused to go to the genderless bathrooms provided.

Lefty-  This is your last chance.  Did you find it odd that in two hours not one shot was taken at front runner Joe Biden?  Shorty- He likely would not have heard it anyway.  He was probably sleepy eyed by then.

Shorty– One debate in, and America is so done with seven or so of these hopefuls.  Lefty- And, for now, I am so done with you.

Bernie Isn’t (that) Crazy.

Posted on by boom booms room staff

Alice Cooper called it.  “School’s out, for summer.”  But, soon, Rodney Dangerfield and others will return.  “Hey, I am going back to school!”  And, when they do they need to bring their checkbook, and then some.

No one disputes the following.  One, the cost of a four year public college/university education in these 50 United States has spiraled out of control.  And, two, the debt that undergraduates and post graduates have incurred is huge at 1.6 trillion dollars and mounting by the moment.

Bernie Sanders and Elizabeth Warren and a few others have led or joined the battle cry to make college tuition free and/or forgive the outstanding student debt.  Each plan to do so essentially redistributes wealth from taxpayers to students and is fraught with inconsistencies.  More later.

But now, we ask, have you ever heard of Sallie Mae?  SLM Corporation (commonly known as Sallie Mae; originally the Student Loan Marketing Association) is a publicly traded U.S. company that provides consumer banking loans.   Its structure has changed dramatically since it was set up in 1973.   At first, it was a government entity that serviced federal education loans. It then became private in 2004 and started offering private student loans.

The company’s primary business is originating, servicing, and collecting private education loans.  Sallie Mae previously originated federally guaranteed student loans originated under the Federal Family Education Loan Program and worked as a servicer and collector of federal student loans on behalf of the Department of Education. 

So, the U.S. government started Sallie Mae.  It then decided the task too tall for itself and allowed it to privatize.  And it’s now government workers who are crying loudest about the soaring student debt.   And, they should.

We took a peak at Sallie Mae’s (now Navient Corporation, the largest servicer of federal student loans and collector on behalf of the U.S. Dept of Education) “generous” loan offers and terms there of last evening.  What’s our conclusion?  You might as well charge your education on your Visa or MasterCard.

Navient loans offered today start at a 7.5% interest rate.  They are tied to a marker of interest rates known as LIBOR, plus 5%.  They are variable, can even change monthly up or down, and are allowed to float as high as 25% if the market so chooses.  That’s 25% as a high side risk!  Seven point five percent isn’t cheap to begin with.  Ford will give you zero percent financing for that new F150.  Sallie Mae and Uncle Sam want more, much more.

But it gets worse.  Let’s take a 40k dollar loan as an example.  You have three options to repay.  All start with paying either $25 bucks a month while still in school, or the interest accumulated each month of $233, or foregoing paying anything at all until you have completed your education.  Tick tock goes the interest clock from day one of course.  The choices are bad, poor, and terrible.

The structured repayment schedule over the course of the next dozen or so years costs about $500 a month at the 7.5% rate, and much more if rates rise.  The total interest is 29k on top of the 40k.   But, here is the kicker of all kickers.  There is no interest saved for paying down the principal in any accelerated manner.  There is no incentive/gain for attempting to get out of the debt.  Sign up and Sallie starts counting her coins.

There is no bankruptcy filing that exempts anyone from repaying either.  Federal laws are written to absolve you of debt incurred when you can no longer keep your head above water, except if that debt is owed to your government.  It’s the golden rule.  He who has the gold makes the rules.  Sallie collects the gold for he who makes the rules.

Making college free (and it wouldn’t be free, just paid by others) and forgiving debt (and that would just be adding to the federal debt that we all are accountable for as well) isn’t the answer.  No answer is that simple.  And no answer should only be for the selected ones who are in debt today or in school tomorrow.   It needs to be equitable.   For example, shouldn’t trade schools be “free” too?  You can’t discriminate for just colleges can you Elizabeth?

Their approach is a big band aid and is designed to garner votes from the young and naive.  The bandage needs to be ripped off of the whole mess and the root cause needs a vaccination.   Otherwise, many will continue to fall down, scrape their knees, and eventually the wound will get infected.   A great start to this would be to examine the ridiculous terms of Sallie Mae and others in this federal loan business for students.  If you didn’t save for college at least there should be an incentive to get out of debt sooner.

Maybe Crazy Bernie isn’t so crazy after all in attempting to address this.  It’s just how, not handouts, that need to be looked at and changed.  Start with Sallie Mae and others just like her.   And, like the $22 trillion dollar debt, and ballooning government, the sooner the better.

Donald, You’re No Ronald!

Posted on by boom booms room staff

When Senator Lloyd Benson was squared off against Senator Dan Quayle in the Vice Presidential Debate in 1988, Quayle, desperate to establish himself as a qualified VP running mate, dropped a JFK reference.   Benson dropped a haymaker on Quayle, deadpanning “you’re no Jack Kennedy.“

We have resisted comparing Donald Trump to Ronald Reagan for fear of a haymaker ourselves, as Donald is no Ronald.  While each had roles on the TV screen or the big screen previous to ascending to the biggest role in all of the land, they differ in approach far more than they are similar.

Start with the hair styles please.  Ronald had a thick, dark, wavy mane seemingly woven to his head since birth to die for.  Donald has a thin, white/gray whisp that needs to be woven to his head for fear of it flying away.  Ronald was a statesman.  Donald states what he thinks and feels in non too subtle way.  Ronald had his first lady Nancy incessantly shaping his public perception.  Donald has had quite a few ladies and his first lady appears to step back and watch the bullfight from afar.

But, they have one big thing in common.  They know leverage when they see it.  And, when they see it they use it.  And, when they use it, they use it effectively.

Ronald watched as Iran held American hostages for 444 days till the very end of the Jimmy Carter’s mediocre presidency.  Mysteriously, on Reagan’s inauguration day, Iran freed the hostages.  Ronald played the good cop role on a horse in a TV western a few times.  He always got the bad guy and rode off into the sunset with the pretty woman.  Iran wanted nothing to do with this cowboy in real life.  Did Reagan’s team advance anything to Iran about the consequences of a continued standoff?  Probably.  Enough said.

Trump called North Korean dictator Kim Jung-Un “Rocket Man” in front of a United Nations gathering.  It was not very subtle.  It was the equivalent of Nikita Khrushchev’s shoe-banging incident during the 902nd Plenary Meeting of the UN General Assembly held in New York in 1960. During the session Nikita Khrushchev, First Secretary of the Communist Party of the Soviet Union, pounded his shoe on his delegate-desk in protest of a speech by Philippine delegate Lorenzo Sumulong.  It was not so subtle.

Both Ronald and Trump were effective, style points aside.

“Rocket Man” is but one of many verbal jabs, hooks, or TKO’s that the Donald has thrown.  It is for that very reason that we continue to be amazed by how wrong the media continues to miss on understanding his approach, and therefore his effectiveness.  Every time he jabs, tweets, nicknames, and/or insults a foreign leader or an entire country the media screams in unison that “the sky is falling, the sky is falling.”  Except, it isn’t.

In fact it’s the opposite.  Trump threatened tariffs on Mexico a couple of weeks back and gave them a short deadline to help on their southern border controlling Central American illegal inflow, and on our southern border helping protect our illegal inflow.  Foes of The Donald said many things. “He can’t do that.”  “You can’t use tariffs to control immigration.”  “It’s unprecedented.”  “He’s offended our neighbor again.”  The stock market said, “Hold on cowboy.”  “This will wreck certain imported products.”  “Prices on imports will go through the roof.”  One Einstein even lamented, “the price of avocados will go up three fold.”

Our guess is that Donald doesn’t like avocados.  And, he doesn’t like illegal immigration even more.  So, with zero help from his Democrat friends, Donald got help on his own from his southern friends.  Mexico, after all of these years, offered immediate help.  Fifteen thousand of their finest are now being deployed on our joint border to stem the flow northward.  Another two thousand went south to do the same.  It’s amazing what the right carrot on the right stick can do.  And, Wall St. rallied once more.

And, it’s equally amazing how many people, tv commentators, and countries totally fail to understand President Trump’s motives and results derived from them. Ronald won with style and grace.  Donald wins with a hammer and a chainsaw.

Donald paints outside of the lines.  Donald is no Ronald.  But, he is Michelangelo in the art of the deal.