Thursday, September 22, 2011

Uncertainty slows (crushes) economic rebound

As many have said, either Obama is not that smart and just doesn't get it, or he is intentionally trying to destroy our economy in accordance with his Clower and Piven teachings. I'm beginning to think it is a little bit of both. As Albert Einstein said "Insanity is doing the same thing over and over again and expecting different results." You have to be a little insane to follow Clower and Piven.

Economic uncertainty, we believe, is a principal reason consumers are saving more, but spending less. Not knowing what the future holds probably also explains why businesses have stashed trillions, rather than investing, loaning or spending.

Business plans give entrepreneurs and investors reasonable expectation of profit.

"[Y]ou have to know what your expenses are, and you have to have some idea of what your revenues are going to be," explains CKE Restaurants CEO Andy Puzder. "Right now people are very concerned about taxes because the president keeps talking about raising taxes," Mr. Puzder adds.

Taxes are only the beginning. There is uncertainty about how many of the hundreds of potential new regulations the Environmental Protection Agency will impose and what form they will take, what new unionization changes may come from the National Labor Relations Board and myriad other government regulations that may – or may not – be imposed, increasing business costs. Then there is the 2,000-page Obamacare health care law's ambiguous mandates and countless regulations yet to be written by unaccountable bureaucrats.

"It's very difficult to model the costs because the bill was so complex, and it's very difficult to find people who understand it," Mr. Puzder says, no doubt echoing sentiments of CEOs across the nation.

This is an example of the magnitude of uncertainty: The potential increase in health care costs alone for a solitary company, CKE Restaurants, was estimated by experts to range from $7 million to $35 million a year. (The final guess was about $18 million in added costs, or twice what CKE spent last year in adding new restaurants.)

Is it prudent for companies to expand or hire when facing such uncertainties, or for consumers to commit to large purchases not knowing their jobs are secure?

Read full Orange County Register article here.

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