Friday Five for June 3 2016

We’ll start with the most predictable outcome of a guidance letter in the last century. Recently, President Obama issued a directive (background here) telling public schools to allow transgendered student to use the restroom of their chosen gender identity rather than their biological sex. Now, the leader of the Georgia chapter of the Americans Civil Liberties Union has announced her resignation after her daughters shared a bathroom with three transgendered women. It was a good idea when it didn’t affect her family – but now that her daughters have been exposed to the very real dangers, she can no longer support the ACLU. This is a classic NIMBY (Not In My Back Yard) effect. This guidance is Obama’s effort at showing kindness to kids with gender identity issues. So Obama and his administration sacrifice the privacy of the masses for a twisted view of kindness to a few. This was entirely predictable. And I’ll predict further that it is just a matter of time before a man posing as a transgendered woman sexually assaults a women in a bathroom. It will happen – but will the press report it?

It appears the next recession is on its’ way. We’re due for another recession, whether you like it or not. Hiring has slowed significantly and those who could work but are choosing not to has spiked. While the unemployment rate has dropped to 4.7%, that is due entirely to the workforce participation rate dropping to a whopping low of 62.6%. This means that out of a pool of 253,174,000 adults who are 16 years or older and who are not in an institution or in the military, a record 94,708,000 adults are not working. During the two terms of the President, that number has risen by 14,179,000. Hence fewer Americans are working to support the rest of the nation. In other words, for every 10 people in the USA who are 16 or older, only 6.2 of them are working. It’s hard to imagine that the other 3.8 of them are not receiving significant Federal and State aid. The President claims that by “almost every economic measure, America is better off” than when he took the Presidency. How about asking those 94M who would like a job and can’t find one if they agree, Mr. President? With this President, I often get the impression that the world I live in and the one he lives in are on different planets.

For US Banks, the weak May jobs report will negatively impact their ability to create profits. “Hopes the Federal Reserve could soon resume raising rates, which would improve bank profits, have been driving share-price gains for banks in recent weeks” wrote the Wall Street Journal. With the lousy May jobs report, it appears the Feds will likely stay on hold, at least in June. Lower discount rates mean lower lending rates, which continues to suppress bank profits.

If you want to play professionally in the National Basketball Association, then you should grow up in a family where you’re directly related to an elite athlete. A new Wall Street Journal study has found that 48.8% of the players in the NBA are related to an elite athlete, whereas that number is 17.5% for the NFL and 14.5% for the MLB. Their study concludes that height is the main reason the statistics are skewed in favor of the NBA.

The Medicare system is projected to be running deficits in just a few years. The highly popular program will be needing additional cash inflows in the future and no one knows where those inflows will come from. Our prediction is that the politicians will not scale the program to revenues but instead will borrow the cash to meet program benefit demands. And with our national debt at $19.2 trillion dollars, one wonders how long our economy can sustain this debt without serious injury to everyone. It’s time for the American people to realize that we’ve spent and borrowed our way into a place where we can’t meet the needs of a military or financial crisis. Our generation has spent the wealth of the next 3 or 4 generations on our own wishes and desires. If future generations rise up and let us die in the streets because they can’t afford to pay for our medical care, it will be a just response.

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