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Archive for April 29th, 2009

When Economy Contracts 6%, What is “Growth?”

The economy contracted by 6.1% in the first quarter of the year. This follows a 6.3% contraction in the last quarter of 2008. Q3 of 08 featured a .5% decline.

This means that this quarter, the economy will have to grow by 13 percent just to get back to where we were at the same quarter of the previous year. Hands up who thinks that is going to happen?

Now let’s assume that the worst is indeed behind us and the economy is only contracting half as fast as it has been for the past six months. That is still a 3 percent decline in GDP for Q2 of 09. If that is the case, the we are talking about a solid year of economic contraction which will not be recovered in 2009.

More importantly, inflation. The extent of the contraction thus far indicates that money is out of circulation, moving at a very low velocity. The instant those GDP numbers turn positive I’d expect to see double-digit inflation, at least for a quarter or two, as productivity tries to recover and “soak up” all the excess cash.

In that environment, say even 2 percent growth with 5 or 6 percent inflation, is that really growth — or an illusion?

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Coca-Cola 600, LMS Should Honor Poole

And not the just with a moment of silence. I think NASCAR realizes that David Poole was the prism through which many of its fans saw the sport. Poole was not a NASCAR writer, he was the NASCAR writer.

I only met David once and did not always agree with him, but there is little doubt he tried to write and report in what he viewed as the best interest of race fans. That led to clashes with the big egos and bigger wallets across the sport.

Here’s hoping they all can put that behind them as thousands of race fans, his fans, fill the stands in Concord next month.

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Clip-N-Save: “Dozens” of Protesters = No Pics, Last Graf

Keep this standard in mind as local budget battles play out in the coming weeks. A midday policy planning meeting drew “dozens” of anti-tax protesters by the Uptown paper’s own account, perhaps 75 by other accounts.

They are not on the agenda, not allowed to speak yet reportedly clearly change the tenor and feel of the discussion. Commission Chair Jennifer Roberts had put the matter on the agenda expecting clear sailing and no opposition.

Yet it is not until the last graf of the story that the anti-tax presence is even mentioned:

The commissioners meeting drew dozens of residents in opposition to any tax discussion. As commissioners talked, many in the audience held signs with phrases like “Taxpayers have been lied to” and “Light Rail = 100 percent over budget.”

Won’t it be interesting to see if an identically sized group opposed to “budget cuts” is the last graf — or the lede?

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The Feds and Gloria Pace King

Way back in December we wondered where the US Attorney might be in this matter. Turns out the feds started sniffing around Gloria King about the same time we did, in February.

There are facts to this matter that all parties wanted to keep under wraps. The United Way’s problem is not that King spent money, willy-nilly all over town, it is that she spent too much money willy-nilly all over town. This was part and parcel of a Caligulan corporate mind-set in this town for the better part of a decade, one that tickled every fancy, no matter the cost.

The expenses the UW’s lawyers are leaking out and claiming to be questionable tally around $50,000. Serious money, yes, especially for a charity. But this went on for years. The UW board knew of King’s spending habits, but kept finding ways to throw more money at her as annual fund drives pulled millions more out of local sources.

Besides, does the Uptown crowd really want the FBI and the IRS to start double-checking the “business purpose” of millions in expenses on bankers’ expense accounts, say from 2005 through 2008? Didn’t think so.

What the US Attorney and any grand jury should consider is asking the question, In what ways did the United Way operation in Charlotte under King and legally responsible board members function as an extortion conspiracy? A protection racket demands money under threat of physical or financial harm. We can tell by the tasselled-loafers that the former was right out, but the latter…how many thousands of white-collar workers in Charlotte could attest to being told to give money to a United Way campaign — or else?

Let’s see if Edward Ryan takes this matter remotely seriously — and starts building a RICO case against those responsible for the shakedowns which funded King’s lavish spending. Without the millions the thousands do not get spent.

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