主题：12/22/2009 Market View -- 宁子

Financials, mortgage makers, automakers, and now commercial real estate. As The Who asked, who's next?

Treasury has used up the first half of the TARP money. It likely wanted to slide into January and the next administration without having to go to Congress and ask for the other half. Or maybe it wants to earmark it before the next administration. If so, it will have the chance.

A new face started making inquiries, asking directions on how to get to DC to ask for some of that TARP money. Commercial real estate is making its case now, another 'too big to fail' segment of the economy. As one of the spokesmen for the industry stated Monday, the US economy cannot recover until commercial real estate recovers.

Add it to the list of critical, can't make it without it industries. Let's face it, all businesses and indeed many US citizens need help. Where do you draw the line? You don't, at least with respect to helping them. The question is, how do you help? We have opened the box of handouts and everyone is lining up for theirs. We have forgotten how we got to where we are.

Some said Monday that it is not socialism to help out businesses and citizens with massive government spending in times of economic crisis. They point out to a history of massive spending in stressful times. Their point is true in that there is targeted spending as well as the general approach through reduced marginal tax rates and the like. The difference this time is the Feds are taking equity in private companies and mandating how they operate.

That is not simply injecting capital and backing off. It is the same as Mr. Potter in 'It's a Wonderful Life' offering to 'help out' for a major stake in the business. It is done under the guise of protecting the taxpayer, but there is no exit plan, no guarantee that once the Feds recover our money that they will get out of the business. Indeed you wonder if they will hamstring the entities and never recover the investment for us, but keep an equity interest to control the most influential industries in our economy.

Very scary. What is the difference from other socialist countries when only the good will of those in office stands between government control of private industry and our free enterprise heritage? We have a Constitution that sets out specific powers to the federal government, reserving all others to the states. Nowhere in that document does it allow taking money from citizens for taking equity stakes in companies.

Yet here we are and more are heading to Washington to get their share of the community pie. Next it will be the hotel industry, then the gaming industry will be there, institutions of higher learning, etc. Basically any group with significant lobbying power. Ironically, those with in theory the greatest lobbying power, the individual voters in the US, will be the least represented. Why? Because we have the money to pay the bills all of the 'vitally important' interest groups are waving in the face of Congress.

That is why we have been adamant that we have to call our Senators and House reps and just say 'no.' It is not that we don't want to help out, it is simply that this is not the way to do it. A free meal ticking program is no way to heal a sick economy. The government should not pick winners and losers but facilitate the markets in allocating resources by making investment capital readily available. How is that accomplished? By creating an environment conducive for PRIVATE investment in US businesses, not government takeovers. Sure money needs to be printed and put into circulation, but let you and me figure out where to invest it. That doesn't take any TARP; just cut taxes for businesses and individuals and then the money will go where it will have the best impact and we don't need any federal decisions about where to put it, who gets it, etc. It is a time proven method, creating the strongest economy the world has ever seen. The other method is time proven as well. There are failed communist and socialist countries littering the path of history.