Rare Reagan Document Sold

by Gerri Willis

Imagine as an 11-year-old asking the president to contribute to your charity fundraiser for the homeless. And, then, stretch your brain a little further and imagine that the president responds with a personal check and letter on White House stationary no less. That's what happened to one young girl named Lisa back in 1986, when she asked President Ronald Reagan to contribute to her walkathon for the homeless.

Now, 28 years later that letter, which offers a window into Reagan's personality, has sold for the first time. The price: $20,000.

"I am very proud to sponsor you in the walkathon," wrote Reagan in the letter. "Thank you for asking. I know you'll walk the seven miles and the enclosed is to help the cause you are serving."

Nathan Raab, Vice President of The Raab Collection, a dealer in historical documents, says, "It gives insight into Reagan the person. When Reagan was in office, he was criticized for not caring about the homeless and this letter shows that to be untrue."

Watch The Willis Report at 5 p.m. ET to see the letter and hear about it first hand from Nathan Raab.  

 

**Image Credit: Raab Collection

D.C. Trip: It's a Wrap!

by Gerri Willis

Spending three days at the Supreme Court covering the Obamacare hearings was a dream assignment for us at The Willis Report. I wanted to show some of the pictures you may have missed earlier in the week and tell you a little bit about the Fox Business team in Washington that made our trip possible.

Rich Edson, Gerri Willis, and Peter Barnes

First and foremost, the reporting team is top notch. Peter Barnes and Rich Edson are smart, dedicated journalists who know Capitol Hill inside and out. I spent a fair amount of time on the steps of the Supreme Court along with hundreds of protestors and many legislators - trying to interpret what was going on inside the hallowed chambers of the court. Everywhere I went, people asked me about our reporters. One long-time legislator told me that Barnes was the only reporter he trusted on the hill and that his rolodex and background knowledge were without comparison. It's people like Peter Barnes that make me proud to work at our network.

Jena Mihalovic, Marty Schnurr, Kevin Burke, Chris DiLella, Gerri Willis, Rich Edson, Christian Galdabini

There were lots of other people who were integral to our effort in D.C. Much thanks to Jena Mihalovic, Bruce Becker, Susan Garraty, Christian Galdabini, Rick Suddeth, Jim Suddeth, Mary Kreinbihl, and everyone else back at the bureau and on the field!

Thanks for making our trip a success!

Boost Your Credit in 2012

by Gerri Willis

In a segment late last week, John Ulzheimer, President of Consumer Education for SmartCredit.com, gave the following tips to boost your credit in 2012. Check out the sites he recommends, below!

If you never ask for a free credit report, you'll never get one. www.annualcreditreport.com is the only website for claiming your free credit reports per Federal law, says John.

Opting out of new credit card offers: Some companies charge you for doing this, but it's free at www.optoutprescreen.com. This will have your name removed from any "pre-approved" mailing list the credit bureaus sell to credit card issuers. This will significantly reduce the amount of credit card offers you get. You can always opt back in if you like.

You may not know it but your credit cards might now have variable interest rates instead of fixed rates. This means any increase in the prime rate will likely result in an increase in your credit card interest rate. Why is this a big deal? Because this style of rate increase does NOT require any sort of notice to the cardholder.

There are a few sites that will give away a free credit score, that doesn't require you to sign up for a trial membership to a credit monitoring subscription. And while none of these are true FICO scores, they are a great approximation for where your credit rating likely stands. The sites are www.creditsesame.com and www.creditkarma.com. (John says the score given out at CreditSesame a better replica of your FICO score.

What's the Best Tablet for You?

by Gerri Willis

 

Is a tablet on your holiday wishlist -- or someone you know's? Check out this comparison chart I told you about in last night's show -- and watch the clip below!

 

Wall St. Cashes In on Solar Stimulus

by Gerri Willis

You've heard me say it before: The unintended consequences of sometimes even well-meaning government policies are, well, ridiculous.

Consider the federal solar energy subsidy. The idea was to give homeowners incentives to buy solar panels, reduce the load on the electricity grid, and become a greener nation - all the while encouraging domestic companies to build solar panels. Kumbayah! Everybody's a winner!

Sounds simple, but consumers were too smart for that. Here's their calculation: If I buy 60 solar panels to offset an annual electric bill of $6,000, say, for a home in California, my tab is $93,000.

Even after the tax deduction, I still have to shell out $63,000. In other words it takes the system a decade to pay for itself. The average American is only in their home about seven years. No dice. The government deal is stupid on its face.

But have no fear -- this free money from the federal government won't go wasted. Wall Street, naturally,has found a way to tap the tax break. Enter private companies backed by Wall Street. They purchase those home solar systems, install them in consumers homes and sell power back to homeowners in an arrangement like that between a cell-phone company and a consumer.

The consumers gets the solar panels but the Wall Street firms pockets the tax break and have even found a way to create a stream of income beyond that.

That's because the consumers agree to pay a monthly stream of revenue -- slightly below their current bill. They get free solar panels and a lower monthly bill. Albiet the solar panels are from China, often the cheapest they can find. And, then they turn the stream of income from consumers into an investment -- securitizing the debt -- like they did with mortgages.

So, instead of incenting consumers to use solar panels by domestic makers -- Washington has incentivized Wall Street to find another source of recurring revenue and gets a tax break too! So who's at fault here -- Wall Street for being creative or Washington for being naive?

I'd say Washington needs to get out of the business of business -- because whether you are talking about housing or industrial policy or solar panels -- the federal government has a habit of screwing it up!

Romney Adviser: Kill Payroll Tax Cut

by Gerri Willis

Republican presidential candidate and former Massachusetts Governor Mitt Romney speaks at the Devine Millimet-Manchester Chamber of Commerce Forum in Manchester on the 18th of Nov.Mitt Romney's economic adviser Glenn Hubbard tells The Willis Report tonight that the economy will continue to suffer from "a rough and tumble year from events all over the world," but that the best stimulus for an anemic American economy is not a payroll tax cut.

"In the near term, the question is what is the most effective stimulus for our economy. I don't think it's a payroll tax cut," he said. "You can consider lower long-term payroll taxes, but that would have to be a part of tax reform."

When asked whether the U.S. should be counseling Europe on how to handle its debt problems, Hubbard, who is also the dean of Columbia Business School, said, "we don't have standing" to advise the continent on a problem afflicting the U.S. economy as well.

Hubbard continued to back his plan for a mass refinancing of homeowners who are current on their mortgage but underwater - that is they owe more than their home is worth. He said the program could pump an additional $70 billion into the economy and would be paid for by mortgage securities holders who are currently benefitting from homeowners inability to refinance. "There is no free lunch," he said.

Hubbard's long career as a financial policy maker included stints as deputy assistant secretary at the U.S. Treasury Department and a consultant to the Federal Reserve Board.

In terms of the European debt crisis, Hubbard had the following to say: "What the Europeans need to do are a handful of things," he said. "First, getting fiscal probity back in the periphery, second is to make sure the European Financial Stability Facility is large enough to wall off contagion, and third get support if those two things happen from the European Central Bank. If that does not happen, the Euro does stand a good chance of coming off the rails, particularly if Italy's troubles widen."

Hubbard says the chances of a double-dip recession for the country is modest but doesn't see very robust growth over the next year. "And, if we had a full-blown European financial crisis, it would definitely tip the likelihood more toward recession in the US."

Super Committee: Take Automatic Cuts ... or Make a Deal?

by Gerri Willis

Alan Simpson directs a response as he and Erskine Bowles testify before the U.S. Joint Select Committee on Deficit Reduction during a hearing on Capitol Hill in Washington.Five days - that's how much time is left for 12 partisan lawmakers to reach a compromise. It could be five months - or five years - and the odds of a compromise would still be slim to none. But five days is what the Super Committee has - or these "automatic cuts" will be triggered. So what does that mean?

If the six Democrats and six Republicans fail to reach an agreement - we would see one point two trillion dollars in cuts. But that's over ten years. And they won't kick in until January 2013.

These cuts would also be put in place if Congress rejects the Super Committee plan or President Obama vetoes it. $984 billion dollars in cuts would be split between defense and non-defense programs. The other $20 billion will come in the form of lower interest payments on our 15 trillion dollar debt.

According to the Center for Budget and Policy Priorities - that's about $55 billion in both defense and non-defense spending each year through 2021.

Social Security benefits are exempt from the spending cuts - as are Medicare benefits, veteran's benefits, food stamps and a few other programs designed to help seniors and low-income americans. But not everything having to do with Medicare will be spared!

Payments to hospitals and other health-care providers will be reduced by two percent a year - these cuts will be coming just as obamacare really starts to kick in - so I'm sure doctors are loving this plan!

And regulatory agencies such as the Commodity Futures Trading Commission and the Securities and Exchange Commission will see their budgets slashed - making it even more likely they will not catch major violations.

One of the biggest casualties of the automatic cuts though would be the military.

And as we've mentioned Defense Secretary Leon Panetta is warning of "doomsday" if the Super Committee fails to act! The Pentagon is already facing $450 billion in cuts over the next ten years. If these automatic cuts take place that would mean a 23 percent cut in the budget - in the first year alone!

By his calculations, Panetta says: "We would then have the smallest ground force since 1940, the smallest number of ships since 1915, and the smallest air force in history."

Not to mention possible months-long furloughs of civilian employees and a complete overhaul of our national security strategy. But Secretary Panetta shouldn't panic just yet - because there's a chance Congress might actually cave on these cuts.

Congress can take all of next year - an election year - to rescind or change any of these things.

Either way I'm not very optimistic any legitimate plan will emerge by 2013. Why? Because this is fourth group of people tasked with coming up with one. The National Commission of Fiscal Responsibility and Reform - headed by Bowles and Simpson - came up with a plan to cut four trillion dollars. That never went anywhere.

The Debt Reduction Task Force - with Pete Domenici and Alice Rivlin - wanted to cut six trillion dollars! That plan was dead on arrival. And the Gang of Six - the bi-partisan senators - had a three and a half trillion dollar plan that never happened.

This administration's approach to debt reduction is the definition of insanity - doing the same thing over and over again - but the national debt is now above $15 trillion.

It's beyond time to stop playing political games and start taking our national debt seriously cause you know us taxpayers already are.

Some Positive Economic News ... for a Change!

by Gerri Willis

Are you as sick of all the bad news in the economy lately as I am?

Well despite what feels like a bombardment of negative headlines - there are definite bright spots in the economy - a recovery may be in sight!

First of all, a recent Wall Street Journal poll shows nearly half of us feel the worst is behind us when it comes to the economy. They may very well be right - this country is structured for growth!

And guess what? We are growing! The economy grew at an annual rate of two and a half percent in the third quarter - the best performance in a year! And many economists are forecasting similar - if not stronger numbers - for this quarter.

Now while hiring is not going gangbusters - there are positive signs here as well.

Even though October only saw a boost of 80,000 thousand jobs - the government revised upward the number of jobs added in August and September.

And today - the number of people applying for unemployment benefits fell to the lowest level since early April - 388,000 marks the fourth decline in five weeks.

It's also the first time in nearly seven months that the four-week average fell below 400,000.

Where are these jobs? Well for starters American manufacturing is back on the rise. Output at the nation's factories rose three-quarters of a percent in October. While that doesn't sound like a lot, it's the fastest rate in three months!

In fact, according to USA Today industrial production is up nearly 13 and a half percent since the "end of the recession" in June 2009.

Car sales - along with the retail sector as a whole - much higher last month - than October of 2010. It probably helped that the Labor Department just announced consumer prices fell for the first time since June.

Bottom line - of course things are going to get better. This is the greatest country in the world - despite only having five percent of the global population - we still have the biggest economy!

We have a culture that enflames the entrepreneurial spirit.

Things are going to get better because there's no room for failure in America. No time to throw our hands in the air and give up. Wwe're going to succeed because in the end we always do, and we always will.

What My First Job Taught Me

by Gerri Willis

I didn't start out wanting to be a business reporter or a commentator on personal finance. Not by a long shot - I wanted to cover politics. And, like a lot of grads today - I hit the job market at a terrible time. A deep recession hit this country in the early 1980s, and in 1981, I was happy to even land a job.

I went to work for a small daily newspaper called The Lima News in Lima, Ohio, which at the time had a population of about 50,000 and a Ford plant. My beat was City Hall - I spent endless hours covering City Hall meetings. I was happy as a clam. But then a funny thing happened.

The local Ford plant began laying off people lots of people. And the layoff packages back then, well, they weren't as good as they are now. After several months, folks started forming informal bartering arrangements, trading toilet paper for light bulbs. The effects began to ripple: Other businesses that were reliant on Ford employee spending had to lay off people as well.

It was horrible to watch. I wrote stories about how people were coping with the situation. And about how the mayor and the city council of that town tried to resurrect their economy -- and lure new business. They set up special economic development zones and romanced scores of corporations. But nothing really worked.

And so, at a fairly young age I learned something fundamentally important: that the private sector - business, not government - had the real power to make a difference in people's lives - to send the kids to school with a full lunch pail - to put food on the table - to provide.

I don't think a lot of Americans have that confidence in companies and the private sector right now - and that's what I worry about.

They think the government can fill the gap ... and it can't.

The government doesn't have the money or the know how to create wealth - it can only disperse other people's money. Today, a lot of people believe that the private sector - companies and businesses - are the problem - that they monopolize the money.

More than three-quarters of people surveyed in a WSJ poll said the nation's economic structure is out of balance and favors the rich over the rest of the country.

For that reason, we need to painstakingly rebuild our faith in the power of the country's private sector. Because it's companies that will hire the jobless, companies that will expand payrolls, and companies that will seed the growth of this economy.

Today Lima is in better shape. It's diversified its economy and grown. It's doing better. And, the rest of us can, too.

Pension Tension Across the U.S.

by Gerri Willis

Speaker of the Ohio House William G. Batchelder (R-Medina).A big victory for unions in Ohio will likely mean a major problem for taxpayers. Ohio voters are defeating a new law limiting collective bargaining abilities. The law - which hadn't yet taken effect - was thrown out. That means current union rules will stand until the state legislature comes up with another plan.

Republican Governor John Kasich traveled the state to promote the law which set new minimum contributions for public employee health care and retirement - among other things.

It was a way for local governments - and therefore all taxpayers - to save money. And jobs.

Here's why: State and local government pension funds are between one and four trillion dollars under-funded! So if the SmartMoney number of four trillion dollars is correct, each of the more than 112 million American households will have to chip in more than $35,000 dollars each! To break it down even further that's nearly $1,200 a year for the next 30 years!

So Ohio voters just decided instead of having public sector workers pay a little more towards their pension - they as taxpayers will most likely pay more!States will have to make up those losses somewhere! And Ohio is in serious trouble when it comes to their state pension fund.

According to the Pew Center on the States - Ohio has a pension bill due of more than $171 million! And only about two-thirds of that is actually funded! So why are pensions such problems across the country?

One of the issues they say is these "defined benefit plans" are required to provide a set number at retirement regardless of market conditions or the general economy.

To do that pensions guess about future returns - and Pew says many assume a yearly return of eight percent. To give you a little perspective on how unrealistic that is, the longest-maturity treasury bond pays barely three percent.

And over the last five years the S&P 500 has returned only about a quarter of a percent! There's also "pension-gaming" - loading up on overtime in the year before retirement. Many do that because pensions often base retiree benefits on the highest year's pay workers get. Many cities and states have adopted rules preventing this from occurring - and many others have raised the retirement age.

But as with most pension fund changes they only impact new or future hires and retirees... So the problem won't be solved for like 40 years!

We as a country just can't afford these pensions anymore - which is why most companies have done away with them - moving from defined benefit pensions to defined contributions like 401(k)s

The question we should all be asking: Is it fair that government workers get what the rest of us don't? We're the ones paying! It's only fair that government workers especially ones who aren't first responders should have to share in the costs of their retirement -- just like everybody else.

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