Suitably Flip

Federal Judge Chucks ObamaCare in toto

PDF of the decision:

It would be a radical departure from existing case law to hold that Congress can regulate inactivity under the Commerce Clause. If it has the power to compel an otherwise passive individual into a commercial transaction with a third party merely by asserting --- as was done in the Act --- that compelling the actual transaction is itself “commercial and economic in nature, and substantially affects interstate commerce” [see Act § 1501(a)(1)], it is not hyperbolizing to suggest that Congress could do almost anything it wanted. It is difficult to imagine that a nation which began, at least in part, as the result of opposition to a British mandate giving the East India Company a monopoly and imposing a nominal tax on all tea sold in America would have set out to create a government with the power to force people to buy tea in the first place.
...
In the final analysis, this Act has been analogized to a finely crafted watch, and that seems to fit. It has approximately 450 separate pieces, but one essential piece (the individual mandate) is defective and must be removed. It cannot function as originally designed. There are simply too many moving parts in the Act and too many provisions dependent (directly and indirectly) on the individual mandate and other health insurance provisions --- which, as noted, were the chief engines that drove the entire legislative effort --- for me to try and dissect out the proper from the improper, and the able-to-stand-alone from the unable-to-stand-alone. Such a quasi-legislative undertaking would be particularly inappropriate in light of the fact that any statute that might conceivably be left over after this analysis is complete would plainly not serve Congress’ main purpose and primary objective in passing the Act. The statute is, after all, called “The Patient Protection and Affordable Care Act,” not “The Abstinence Education and Bone Marrow Density Testing Act.” The Act, like a defectively designed watch, needs to be redesigned and reconstructed by the watchmaker.
...
Because the individual mandate is unconstitutional and not severable, the entire Act must be declared void.

(HT: Ace's flaming skull)

Fox News Live 11-12

I'll be on Fox News Live this morning from 11-12.

Topics to include Egypt, Congressional spending, and Axelrod's departure.

You can stream the show (and join the live chat) here.  If you miss it live, it'll be available at the link until 5 pm.

On Egypt, World Left Rudderless As All-Purpose Expert Abstains From Comment

The soothsaying columnist and rumored economist who peered into the soul of an Arizona madman and teased out truly imperceptible traces of radio-talk-show-fueled animus, who has successfully predicted at least 7 of the last 2 recessions... has no expertise?

I don’t know anything, have no expertise, haven’t even ever looked at the economic situation. Hence, no posting. If there comes a point when I have something to say, I will.

It's at least some small comfort to know that once Krugman's considerable and varied facilities are able to discern a convincingly coalescing opinion among those he seeks to impress, he'll at last deign to grant it voice of such gravity and accreditation as lent by his byline.

Until then, best to avoid cocktail parties.

(HT: JWF)

Dow Done Tickling 12k

Yesterday, I noted that a downside surprise in today's Q4 GDP estimate could quickly extinguish the Dow's (rather implausible to begin with, given recent data) flirtation with 12,000.  I suggested that an overdue market correction could even be catalyzed if we saw an outright pullback from the prior quarter's 2.6%, rather than simply a failure to match analysts' expected acceleration (to 3.7%).

Happily for bulls, only the latter played out.  Growth did accelerate, but the jump was barely half what economists had forecast.

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 3.2 percent in the fourth quarter of 2010, (that is, from the third quarter to the fourth quarter), according to the "advance" estimate released by the Bureau of Economic Analysis.  In the third quarter, real GDP increased 2.6 percent.

While the news could've been worse, 12,000 did indeed disappear over the horizon, with the Dow on course for what would be its worst session in more than two months (down 140 to 11,850 at noon).

On the bright side, it might not be as ugly as next Friday.

Americans Not Super Keen On Obama's "Investment" Priorities

Fully half "now oppose the federal government spending more money in areas like education, transportation and technological innovation."

Only 41% support further spending increases on even these most popularly palatable line items.

(HT: Townhall)

Dow Tickling 12k On Decent Housing, Cruddy Joblessness, and Q4 GDP Anticipation/Apprehension

Countervailing surprises on the data front this morning, with pending home sales notching a surprise increase of 2% in December (a deceleration from November's 3%, but better than the expected decline of 0.5%) and initial jobless claims popping back to their miserable mid-2010 levels, up 51,000 to 454,000 (way worse than the consensus of 410,000 and - while volatile on a weekly basis - indicative of ongoing erosion in the labor market).

While stocks are generally looking on the bright side of the mixed news, it's tomorrow's first look at fourth quarter GDP growth that will likely decide whether we hold above or dive back under 12,000.  The market expects a decent jump from the previous quarter's wholly unimpressive 2.6% up to an only mildly unimpressive 3.7%.  Not enough to tinge the economic air with the scent of robust recovery, but surer footing anyway.

Should we whiff, on the other hand - badly enough, say, that the headline number ticks down even slightly from 2.6% - then given the ever more rarefied heights to which the market has rather curiously climbed in the last 8 weeks, it may be the catalyst for a correction that's just begging to begin.

NYT, WaPo's Flash of Genius: 0 + 0 > 0

Ever fewer of the unenlightened masses are interested in buying the news content produced by their regional daily paper.  So maybe they'll pay for content collectively produced by a whole bunch of daily papers!

A news-aggregation service backed by the New York Times Co., Washington Post Co. and Gannett Co. went live on Tuesday morning, a venture that will begin to answer a key question among publishers: Will consumers pay to have otherwise free news neatly packaged in a single place?

Ongo.com is a website that lets subscribers choose from over a dozen papers and other sources to create a personalized news site where they can organize and share material.

Ongo Inc., of Cupertino, Calif., charges $6.99 per month for access to the New York Times, USA Today, Washington Post, Associated Press and Financial Times. Subscribers get one additional news source for free, and for each title beyond that, they have to pay a price set by the publisher of that title. Other titles currently available include the Guardian, the Boston Globe and Miami Herald. Ongo will share revenue with the publishers based on what consumers sign up to read.

To realize Ongo is going to be a smash hit, all you need to do is to convince yourself that news consumers' desertion of the major newspapers has primarily owed to ineffectual packaging and the inconvenient lack of online co-location.

SOTU Stunner: Entitlement Reform Doesn't Figure Into the New Civility

We don't hit national insolvency until well after the 2012 elections, so who can blame him for kicking the can just a few more years down the road.

Fox News Live 11-12

I'll be on Fox News Live Monday morning from 11-12.

Topics TBA in the morning.

You can stream the show (and join the live chat) here.  If you miss it live, it'll be available at the link until 5 pm.

L.A. Times To Undergo Mandatory "School House Rock" Re-education

"Well, I wonder who that sad little scrap of paper is...?

Today’s L.A. Times calls the bill to repeal ObamaCare a mere “resolution”:

House GOP passes resolution to repeal healthcare law

House Republicans passed a largely symbolic resolution Wednesday to repeal the nation’s new healthcare law, fulfilling a top campaign promise and setting the stage for a renewed battle in the Senate.

Not so.  It is a bill. If passed by the Senate and signed by the president, it would repeal ObamaCare.

Inevitable: Healthcare, Financial Regulations Safe From Obama's "Review"

I suppose less odious industries, like green energy and trial lawyers might make the cut.

The review focuses on old, outdated regulations so new ones written as part of the health-care and financial overhaul likely won’t be affected, an official at the White House Office of Management and Budget said. Mr. Obama wants agencies to take a fresh look at old regulations to determine whether they are outdated or unnecessary. “New regulations will not be priorities for the lookback,” the official said. …

The move was welcomed by some Republicans and the business community. U.S. Chamber of Commerce President and Chief Executive Thomas J. Donohue in a statement praised the executive order as a positive first step. Still, he said, the U.S. regulatory system is broken. He added, “No major rule or regulation should be exempted from the review, including the recently enacted health care and financial reform laws.”

(HT: NRO)

Fox News Live 11-12

I was on Fox News Live this morning from 11-12, talking about gun control, Obamacare, expansion of the regulatory state, and mountain top coal mining.

You can catch the replay here for the next 24 hours (our hour begins at about the 2:20:50 mark on the reel).

Market Looking Toppier and Toppier

Yesterday, I noted that the mini-spate of unexpectedly disheartening economic news (and its wake's failure to perturb the market's increasingly worrisomely long-toothed ebullience in the face of uneven data) and suggested we could be in for a rough week, with another handful of potentially sobering datapoints slated for release.

Today (with equities enjoying a broad rally and fresh multi-year highs), market strategists from RBC and JPMorgan separately warn that we're poised for an outright "correction" (generally a decline of 10-20%), though they differed on just how imminent the fall might be.

Higher-than-forecast U.S. jobless claims this week and China’s measures to cool its economy may spur a “correction” in the benchmark gauge for U.S. equities in the first quarter, according to Myles Zyblock, chief institutional strategist at RBC Capital Markets. Thomas Lee, his counterpart at JPMorgan, said the S&P 500 Index will continue to gain before peaking at about 1,333 in March or April.

“We’re going to run out of steam at that level,” Lee, the chief U.S. equity strategist at the New York-based bank, said in a telephone interview today. The drop will start when “the hazardously bullish people lose conviction.”

The S&P 500 Index is poised to advance for the seventh straight week, the longest streak since 2007, as stronger-than- expected corporate earnings have tempered concerns that a slowdown in the global economic recovery will hurt stocks. U.S. first-time jobless claims rose to the highest level since October in the first week of the year, missing economists’ estimates. China’s central bank said on its website today it raised lenders’ reserve requirements to rein in liquidity.

“The market set-up is already there for a correction,” Zyblock wrote in his note. The decline will create a “buying opportunity” in “economically sensitive and globally centric” shares, he said.

Seems to me that another week of disappointing data (given that recent market gains seem to suggest a consensus of relative contentedness) could be enough to strip at least the more hazardous bulls of their conviction.

"No Triple-A Rating Is Forever"

Gulp.

It seems that the profligate U.S. government is now on double-secret probation.

The two leading ratings agencies haven’t made any formal moves to threaten America’s vaunted top-notch AAA credit rating. But they continue to chirp about the possibilities.

At a Paris conference, Carol Sirou, head of S&P France, opined: “No triple-A rating is forever.” Well, Rome did lose its top rating sometime after the Visigoths made hay. Ms. Sirou also made the daring claim that S&P can’t “rule out changing the outlook.”

Not to be outdone, Sarah Carlson, senior analyst at Moody’s, told Dow Jones: “We have become increasingly clear about the fact that if there are not offsetting measures to reverse the deterioration in negative fundamentals in the U.S., the likelihood of a negative outlook over the next two years will increase.”

So, if America continues to binge for a couple more years, then Moody’s might start considering making a move.

This, on top of a new glimpse at creeping inflation and an unanticipated indication that the much ballyhooed second-order improvement in joblessness may have been more ephemeral than hoped, and stocks are holding flat (still enjoying pre-Lehman levels, following their spritely 2-month run)?

Color me bearish over the next 7 days, as a slew of fresh economic numbers pour in - from retail sales to industrial production, and a heap of potentially disheartening housing data.

A Fine, Lengthy Essay On Jared Loughner, the Irrationality Of Risk Management In Public Policy, and the Possible Existence Of "Category 3" People

Spare a few minutes for Ace's "insanely long" post.

Fox News Live 11-12

I'll be on Fox News Live (fka Strategy Room) this morning from 11-12.

Topics: Giffords, gun control, inflamed rhetoric about inflamed rhetoric

You can stream the show (and join the live chat) here.  If you miss it live, it'll be available at the link for 24 hours after it airs.

It's a Boy!

It's a Charles Philip Pidot, to be exact.

6 lbs, 9 oz of squirmy, bubble-blowing joy that surprised us with a fast and furious delivery a couple weeks early, just after noon on Tuesday.  Baby and Mom are both doing superbly.  And your humble narrator is over the moon to have been made a father by such a strikingly handsome and clearly brilliant little man.

Happy birthday, Charles!

 

Fox News Live 11-12

I'll be on Fox News Live (fka Strategy Room) this morning from 11-12.

Topics include Obama's 2011 agenda, the shifting landscape for health care reform/repeal, and the fate of Eric Holder.

You can stream the show (and join the live chat) here.  If you miss it live, it'll be available at the link for 24 hours after it airs.