Something Good Happens
Research for Online Investors

by John Dalt

1/22/10

While we were not looking, something good happened.  Yesterday, Senator Lisa Murkowski, R-Alaska, introduced a resolution to strip the EPA of power to regulate greenhouse gases.  Predictably, this has the world improvers up in arms.  Murkowski has 37 co-sponsors of the measure.  She is a few votes short of gaining passage, but hopefully will gain the required majority necessary.

Last year the EPA issued a formal endangerment declaration that greenhouse gases endanger your health, thus they must regulate carbon dioxide.  The problem is that carbon dioxide is what you exhale.  Carbon dioxide is what plants need to grow.  Carbon dioxide occurs naturally, and has always been present in our atmosphere.  When carbon dioxide levels increase, plants and agriculture (food production) thrive.

Rather than ask you to take one less breath per hour, the EPA has proposed a “tailoring rule” to start the regulations on the largest emitters of carbon dioxide.  They would start by regulating emitters of 25,000 tons of carbon dioxide annually.  This is easy pickins’, as it is easy to single out the big bad utility and industrial polluters.  American’s won’t voice anger until they get their electric bills, and it will be too late as the compliance money will have already been spent.

Barbara Boxer, D-California, is spewing a lot of carbon dioxide over the use of the Congressional Review Act to limit the EPA.  She calls it a “direct assault on the health of the American people.”  The San Francisco Chronicle has the story, “Boxer blasts bid to block EPA greenhouse gas rules.”

The president has used the EPA as a hammer over the congress, if they don’t pass “cap and trade”, his administration will do it by regulation.  If the congress doesn’t take away this threat, they will be complicit in allowing the EPA to place erroneous regulations on the U.S. economy.

A hockey mom, or a pit bull?

The disapproval resolution was filed under the Congressional Review Act (CRA).  Under the CRA, a resolution goes to committee, if they do not report it out favorably, thirty senators can order discharge by petition.  The resolution is placed on the Senate Calendar for expedited consideration, and is not subject to filibuster.  In a touch of irony, the CRA was passed in 1996 and co-sponsored by Harry Reid D-Nevada, the current majority leader of the Senate.  Since this resolution has 38 co-sponsors, we should get to see a vote on it in the Senate.  This is the best way to stop “cap and trade” by a government agency.

To tie up yesterday’s observations in MarketToday, about the Fed intervening in the equity markets.  What could be more manipulative?

• Support and bid the markets higher to add credence to the economic programs of the administration.
• Publicly attack the financial sector and withdraw support or even sell the market lower, just before announcing a requirement for 401K’s and IRA owners to invest in “safe” annuities and treasuries.

We don’t know, but are naturally suspicious.

“The Obama Administration's ultimate dream is a land of a just a little milk and honey. Or, a Goldilocks economy... nobody makes too much and nobody makes too little.”---Charles Payne

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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