The Supremes

This morning, the Supreme Court of the United States (SCOTUS) came out with a bevy of opinions. This stuff is important, and I strongly encourage you to care.

For one thing, they decided that it is none of the Government’s business what two consenting adults do in their bedroom. Specifically, they struck a Texas law prohibiting “deviant sex.” Although this has been portrayed as a “gay sex ban,” it banned a number of activities enjoyed by otherwise law-abiding heterosexuals.

They also ruled that California could not arbitrarily and retroactively extend the statute of limitations, not even on Really Bad Stuff. Specifically this case involved prosecuting a child molester for actions of 50 years ago. Make no mistake, what he did is bad! No question about it! But if the government can decide that the statute of limitations does not matter on this crime, they can decide it doesn’t matter on almost any crime. Unless your youth was completely free of indiscretion, that idea should scare you.

Furthermore, they ruled that defendants have a right to competent legal counsel, particularly in death penalty cases. At issue is the case of a man who, had the jury known what an awful childhood he had, might have ruled that life in prison was adequate punishment. Since his lawyers never bothered to present the information, the jury never heard it, and sentenced him to death. Now, he gets a new sentencing hearing, not a new trial.

Important stuff. Check it out.

Cheese it! It’s the FED!

Today, Agent Greenspan and his posse at the FOMC are set to drop interest rates again. Oops, make that yet again. Never mind that interest rates are at historically low levels. Don’t get me wrong, I respect Greenspan and think he has done a generally good job in the past. However, I don’t think one more cut is going to help anyone. I believe there is a point beyond which rate cuts do not stimulate the economy, and that we are there.

Businesses are still not making large capital investments — the official reason why lower interest rates stimulate the economy. Theoretically, businesses expanding on cheap credit build bigger plants and hire more people to work in them (hasn’t happened), and the companies which supply the infrastructure must also expand to meet demand (also not happening).

To make matters worse, the insurance companies are not making money on their investments because of low interest rates, which means premiums must go up. This creates a fake “crisis” in any business which requires heavy insurance coverage.