Stevearino

Readers: See the article attached, The Inequality Myth - WSJ.com. An amazing editorial. The “Ticket Line” analogy was perhaps the most appealing explanation of the situation. In this election season, the Democratic candidates want to paint this woeful picture that the poor remain year-over-year in a group of the perpetually destitute.

That’s simply hogwash. Most of the cab drivers and others in not-so-well-paying service industries I speak with are taking classes in skilled industries, such as electronics and technology, and they, too, in a couple years, will jump into the next bracket.

Unfortunately, since the median rarely shifts (roughly the same number of people remain in this group year over year, and  despite the shifting into and out of it), most people don’t read into the numbers, and regular people assume that the poor always will remain poor. This article disproves this theory as stating that people are always moving into and out of this medium.

Moreover, could you honestly imagine the “dream” of Hillary to make everyone earn the same through income redistribution? For Pete’s sake, there would be no incentives! Who would want to work when your better ideas or harder work produce the same salary as a fry cook?

We all have our place in life. Courage and intelligence prompt more gifted people to work even harder and make the world just that much better (including themselves and their families). It’s capitalism at work. The hardest working shall be rewarded more than those who don’t produce as much. The person with the most new and exciting idea will reap the benefits of being there first. Investors who place money at risk should pay little, if any, taxes on the capital gains they receive. The easiest way to grow this process and make it fair for everyone is to allow these incentives to remain.

I welcome thoughts and opinions on this topic and the editorial.

WSJ: “The Federal Reserve’s decision to lower the discount rate and ease the terms of discount borrowing but not to cut its main rate, the fed funds target, suggests that for now it believes the problems in the markets are mostly related to the availability of cash, not the price of cash.”

Readers, what do you think? Have we staved off a recession? Is the worst over, or will this band-aid get soggy and fall off (eew)?

Personally, I think this will allow the cash injections to stabilize the markets over the next month, and provide stability for a basically-flat 4Q. My guess now: A receovered Dow 14200 by Dec 31, providing no major hurricanes, terrorist attacks, or scandals.

http://blogs.wsj.com/economics/2007/08/17/odds-of-fed-funds-rate-cut-increase/