Category Archives: markets

Another Judge Gets It Right

Posted on by
Reply

Federal Judge Timothy DeGiusti has issued a preliminary injunction against Obamacare’s contraceptive mandate, thereby preventing the Feds, for the time being, from requiring organizations in the Western District of Oklahoma to make available insurance policies that cover the morning-after pill and similar contraceptives, and contraceptives in general.

GuideStone Financial Resources, an entity of the Southern Baptist Convention that handles health benefits for the Convention, brought the suit on behalf of nearly 200 ministries that use GFR to provide benefits for their employees.

It’s important to note that this is a preliminary injunction, and it can be overruled at any time.  However, it is intended to last throughout the suit itself: GFR, et al., have the right, says the Judge, to pursue their case, and it’s necessary to protect them from the harm caused by enforcement until the matter is settled.  After all, GFR, et al., have an excellent chance of winning the suit.

And they should win.  No government has any business dictating the religious tenets of our citizenry, nor does any government have any legitimate authority with which to overrule those tenets—especially for the petty convenience of that government.

DeGiusti’s ruling can be read here.

The Fed Tapers

Posted on by
Reply

…and the stock market shoots up.  QE was supposed to be propping up the market, driving it even; heretofore, whenever the Fed mumbled that it was maybe thinking about beginning to taper sometime in the vague future, the market tanked.  What’s up with the hard increase?  John Malkin at AEI suggested three reasons for that.

These reasons center on the fact that the Fed is continuing its monetary easing through other channels (the Fed Funds rate and a lowered unemployment rate threshold); the now fact of tapering reduces uncertainty about the Fed’s actions; and the fact that the Fed actually has been buying $94 billion in bonds monthly this year (not the advertised $85 billion), and no one noticed the drop—the $19 billion reduction was perceived as the advertised $10 billion, so the taper size seems to be no big deal.

To those, I’d like to add a fourth reason, and a warning.  The reason is this: the fact that the Fed actually has begun easing is taken as its advertised criteria for doing so having been met and will continue to be met in the nearby future.  This perceived confidence in the economy’s recovery by the Fed is viewed favorably by the market.

The warning is this.  Malkin opened his article by tacitly pooh-poohing a QE-induced market bubble.  Comparing market performance with actual economic performance, it seems clear to me that a bubble was generated.  Comparing the current market to the current underlying economy, it seems equally clear that the bubble is merely extending in that perception-based optimism.

In the end, the economy will catch up with the market.  Or the market will fall back to the economy.  Heads up.

Foolishly Lawless

Posted on by
Reply

Are there other ways of being lawless that matter?  Of course there are, but that’s for a different post.  The foolishness of this example of the Obama administration’s lawlessness is the subject here.

HHS Secretary Kathleen Sebelius has announced (sotto voce, via a letter to selected Senators) the latest rewrite non-legislatively effected change to the Obamacare law.

She…would allow people who got cancellations and could not find affordable new coverage to qualify for a “hardship exemption” in order to avoid a penalty next year for not having insurance.

Further…those individuals will be able to purchase bare-bones plans [catastrophic coverage plans] that until now were available only for people under 30.

…expected it to impact fewer than 500,000 people.

Senator Marco Rubio (R, FL) remarked,

Holding a fire sale of cheap insurance is not a responsible fix for a broken program.  This is a slap in the face to the thousands of Americans who have already purchased expensive insurance through the ObamaCare exchanges.

There are more than 5 million Americans in this sinking canceled insurance plan boat, though, not a half million.  And what about those folks who have already re-signed into suboptimal (but more expensive to make up for it) Obamacare plans about whom Rubio worries?  The open enrollment period doesn’t end until next March: how many of those folks will cancel their shiny, new, more expensive Obamacare plans and pick, instead, the Sebelius Plan—to the detriment of the Obamacare law cost structure?

Moreover, the “hardship exemption” under which Sebelius is offering her Plan says this about eligible hardships [emphasis added]:

…experienced financial or domestic circumstances, including an unexpected natural or human-caused event, such that he or she had a significant, unexpected increase in essential expenses that prevented him or her from obtaining coverage under a qualified health plan.

Is Sebelius really saying that Obamacare is a Man-Caused Disaster?

Finally, all this Individual Mandate…folderol…is coming after Obama and his Senate cronies shut down the government rather than delay the Individual Mandate.

Just how idiotic can one grown, adult President and one grown, adult Cabinet Secretary be in one lifetime?

Health Insurance Premium Changes Due To Obamacare

Posted on by
Reply

There is a March 2013 report coming to light, prepared jointly by the House Committee on Energy and Commerce, Majority Staff; the Senate Committee on Finance, Minority Staff; and the Senate Committee on Health, Education, Labor & Pensions, Minority Staff, titled The Price of Obamacare’s Broken Promises: Young Adults and Middle Class Families Set to Endure Higher Premiums and Unaffordable Coverage, and it’s available here.

There’s a lot of data in the eight-page report, but the money figure is this one:

Those were estimates last spring, and for two states, the estimates weren’t available.

As of last September, though, Forbes estimated Vermont as having premium increases ranging from 71% to 157%, depending on age, and New York having a rate decrease in the neighborhood of 40%.  Forbes also estimated that some 17 states would see premium decreases in at least one age/gender demographic; although with many of those seeing the decrease in only one or two such categories.

Since Obamacare went live nearly three months ago, customers—especially those who’ve had their policies canceled out from under them—are seeing just these increases, and they’re also seeing enormous increases in deductibles—the amount of out of pocket expenses that must be absorbed by the patient before an Obamacare policy kicks in to pay (for a Bronze plan) all of 60% of the patient’s expenses.  For that year.  That’s a really sick patient to have all those expenses before coverage kicks in.

Some deal, this Obamacare.

Why Is Delta Afraid?

Posted on by
Reply

Indeed.  Or, it’s just an abuse of market power?

Paulding County, GA, has an airport, Silver Comet Field, and Paulding wants to have a small air line operate all of four or five flights per day out of it.  Hartsfield-Jackson International Airport is 40 miles away, has five runways, 203 gates, and a 46 million passenger-per-year throughput.  Delta Airlines, which uses Hartsfield for its hub, is feeling so threatened by this dinky little airport that it’s doing everything it can to stifle Paulding’s “competition.”

Holden Shannon, a “senior executive” for Delta put an op-ed into the Atlanta Journal-Constitution worrying, with no irony, that

a second airport can quickly expand, and the impact on Hartsfield-Jackson would be significant.

This, though, is sort of the nature of free competition.  Is this what Delta fears?

Shannon also said competition from Paulding would “threaten Atlanta’s economy.”  But the only form the competition would take would be from price competition, making consumers better off.  Is Delta really so fragile that one more, dinky, entrant into the market will push it over the edge?  Is Delta that badly run?  Is that what Delta fears?

He also complained to the Paulding County Commission Chairman, bellyaching that Silver Comet Field’s plans supposedly were hatched in secrecy.  But he chose not to explain why a business is obligated to form its plans in full view of its competitors.

Shannon isn’t the only Delta executive with his knickers bunched, either.  Richard Anderson, Delta’s CEO, told the AJC that the planned commercial operation would be “an economic and community failure.”  Never mind that that’s not Anderson’s call—that’s for the market and the community to decide.  Is this what Delta fears—that the market will decide in favor of competition?

Hmm….