Meanwhile …

Naturally, it’s women they want in jobs these days

Karl:

There are two “nightmare” scenarios that I have been concerned about for more than two years.  The first is an equity sell-off that comes with a big selloff in Treasuries.  The second, which we may be seeing the start of, is a selloff that comes with a big dump in the dollar.

Both are bad news, because both severely constrain the ability of The Fed and Geithner to do anything about it, and the “common elixers” will simply make the situation worse.

The usual response to a selloff in the stock market that is threatening to get disorderly is to pump in liquidity.  But doing that weakens the dollar.  If the dollar has correlated with the selloff then pumping liquidity makes the selloff accelerate, which means that Bernanke has to pull liquidity to keep control over the currency and sacrifice the stock market.

Meanwhile, small businesses in the U.S.:

  • Represent 99.7% of all employer[s]
  • Employ just over half of all private-sector employees
  • Pay 44% of total U.S. private payroll
  • Have generated 64% of net new jobs over the past 15 years
  • Create more than half of the nonfarm private gross domestic product (GDP)
  • Hire 40% of high-tech workers (such as scientists, engineers and computer programmers)
  • Are 52% home-based and 2% franchises
  • Made up 97.3% of all identified exporters and produced 30.2% of the known export value in FY 2007.
  • Small firms produce 13 times more patents per employee than large patenting firms; these patents are twice as likely as large-firm patents to be among the 1% most cited.

It’s not just the Feds looking for a piece of these guys. Small businesses are looking juicy to revenue-starved state governments.  If you’re going to start a business or expand the one you’ve got now, it doesn’t really matter what you do or what you’re going to do, the government is your partner no matter what business you’re in – as long as it’s legal (there are exceptions to this).

But the government won’t give you any capital – you have to come up with that on your own. The Government won’t give you any labor – that’s definitely up to you.  What the government will do, however, is demand you follow all sorts of rules about what products and services you can offer, how much (and how often) you pay your employees, and where and when you’re allowed to operate your business.  That’s half of your profits.

Now in return for the government rules, the government is going to take roughly half of whatever you make in the business each year. Half seems fair, doesn’t it?   Of course, that’s half of your profits.  You’re also going to have to pay the government about 12% of whatever you decide to pay your employees because you’ve got to cover government expenses for promulgating all of the rules about who you can employ, when, where, and how.

It’s not only in the U.S., of course.  People in work and small businesses are cash cows for governments and further their agenda of bringing down all but the big corporation/government/military/globalist complex on the one hand, and a serf class [with people dropping off the middle-class as jobs are lost and mortgage repayments defaults] on the other.  It pays for the agenda, just as the slug on the City over here does the same – someone has to pay for all those committees and that paperwork, after all.

Welcome to 2012 [not far away now].

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