US Dollar Under the Bus

While I was trying to recuperate from a flu over the weekend, Nancy Pelosi did a sneak attack and passed her monstrosity known as "Affordable Health Care for America Act of 2009", or H.R. 3962 (in my mind, the health care deform) on Saturday night. (I'm sure it's a bargain for $30,000 per uninsured person.) Then, as if to prevent the stock market from tanking on Monday (Pelosi's deform will cost fortune for the rest of us; she doesn't care, she's one of multi-millionaires in Congress), G20 pledged to keep stimulus in place to prop up the global economy.

As the result, U.S. dollar was thrown under the bus. Oh for the good of the world, no doubt. Dollar carry trades in various forms (such as issuing U.S. dollar-denominated sovereign debt, for example) just got started.


The next support comes around 72 on the U.S. dollar index (DXY), which tracks a basket of currencies (Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish Krona, Swiss Franc) against the dollar. The last time the dollar index was in the 72 range was March - July 2008. Below that level, the currency will boldly go where no one has gone before. The area around 72 is the multi-decade low. (Remember this chart?)

The U.S. stock market cheers. Dow Jones Industrial Average is up 151 to 10,175, S&P500 up 16 to 1,086, Nasdaq up 30 to 2,143 as of 12:09 EST. What will Little Timmy and Big Ben do next?

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H.R. 3962 House Health Care "Reform" Bill for Vote Saturday

Democrats are so eager to own it.

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(Update) Democratic leadership suggesting that they may postpone the vote to Sunday or early next week because of internal opposition. See this article.
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House Prepares Health Vote, Undaunted by Elections (Update1)
(James Rowley, 11/5/09 Bloomberg)

"Nov. 5 (Bloomberg) -- House Democratic leaders, undeterred by delays in the Senate or this week’s Republican electoral triumphs, plan to call a vote Saturday on the most sweeping overhaul of U.S. health-care policy in four decades.

"The House will move on the $1.05 trillion legislation that would cover 36 million uninsured people and create a government plan to compete with private insurers even after the election of Republican governors in New Jersey and Virginia. President Barack Obama will go to Capitol Hill tomorrow to meet with House Democrats, as they seek the 218 votes they need to pass the bill, a Democratic leadership aide said.

"Party leaders signaled they’re ready for a debate on the legislation and a vote on its final passage by filing a 42-page amendment that made last-minute changes to the bill. The Nov. 3 filing triggered a 72-hour waiting period that Democrats pledged to give Republicans before a vote."

You can read the entire article by clicking on the link above. But the last paragraph cited above needs clarification. Yes, Pelosi posted the amendment, but that is not what she had solemnly promised, which was to post the final draft of the legislation itself 72 hours in advance of the vote.

So, the former H.R. 3200 has morphed and bloated into H.R. 3962, retaining almost all the controversial sections and more, to the tune of $1.05 trillion dollars over 10 years. $29,167 per uninsured person.

Pretty much in line with this government's idea of "bang for the buck". The cash for clunkers program generated extra 125,000 sales at the cost of $3 billion, or $24,000 per car. But both cash for clunkers and health care "reform" vastly outperform the stimulus package, which so far generated or preserved 640,329 jobs for $207.3 billion spent so far. $323,739.83 per job created or saved (of course there's no breakdown of "created" and "saved").

There are 256 Democrats out of 435 House members, and they only need a simple majority of 218 votes. Democrats don't need a single Republican to pass this bill that promises so much for the supporters of bigger bureaucracy. After all, this is basically the same Congress that passed the bankers bailout bill (TARP) last fall against the overwhelming opposition from the taxpayers.

I only peeked into H.R. 3962 (1990 pages by the way) as I just couldn't stand it long enough. I will try to peek more later, but according to many people who have been going through the bill, the legislation would create 13 new taxes.

HR 3962: 1990 Pages, Thirteen New Taxes (10/29/09 Left Coast Rebel)

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