Who are the 3 Biggest Enemies to a Dow Average 12,000

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in The Wrong Question

While this is an important question, a better question should focus on enemies of the Dow Average maintaining the 10,000 mark reached yesterday after a terrifying market free fall.  So, these three career politicians represent just three very dangerous threats to continued economic and financial recovery.

 

Barney Frank:

If there is one person who bears responsibility for the mortgage meltdown, it is clearly Barney Frank.  Not convinced?  You can watch this C-Span video from 2003 when he tells his colleagues in congress that there is not a significant problem with Fannie or Freddie, or its lending policies.  Turns out he was completely wrong.

This man and his failed economic policies are a very serious danger to our economic system and a healthy investment environment.

 

Stephen Lynch:

This member of the house financial services Committee (D- Massachusetts) has decided that a new tax on all financial transactions will be a great way to support new government give aways.  So, every time you buy a mutual fund or stock in your IRA, 401k, college fund or investment account, your government will take “a small piece” of that transaction.  The Economic Policy Institute estimates that will suck up to $150 Billion a year from American investment accounts. 

Career politicians do not seem to grasp well that in the real world, additional costs typically lead to lower incentives to buy.  Lower demand leads to lower economic results and lower market results.

 

Barak Obama:

Our economy, our markets, even the “American Way” is predicated on hard work, risk taking and the ability to take advantage of opportunities presented by a vibrant economy.  Regardless, President Obama suggested yesterday that we spend $13 Billion dollars (which we do not have), so we can give those on Social Security and extra $250.

Why?

Because 1) he’s a career politician and 2) because stagnate prices will otherwise prevent Social Security from increasing benefits over last year.  You heard correctly, our President wants to spend $13 Billion dollars so people who are not working can get a raise during the worst economic environment in a generation.  Are raises now guaranteed?

These are just 3 of the dangers to our continued economic  and markets recovery and  there are surely others, who can you name?

{ 4 comments… read them below or add one }

Todd October 21, 2009 at 6:18 pm

Joe:

Can you provide the link so readers can follow.

Thanks

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Joe October 21, 2009 at 5:34 pm

You are dead on right! I blogged about the Social Security gift last week. Ridiculous!

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todd October 16, 2009 at 2:46 pm

Thanks for the helpful information, hopefully investor/citizen reaction is as strong as you suggest.

Reply

RetirementTax? October 16, 2009 at 1:29 pm

Financial transaction tax: The revenue will be net negative, the costs to the citizens will be irreparable. This proposed stock transaction tax is nothing more than intentional wealth destruction of the middle class and poor, and businesses. 10-14-09: Taiwan tax commission, for example, wants to introduce for a 3rd time a stock transaction tax, I guess because it failed so well the first two times. 1973 was the first time they introduced the tax, result: the market fell 63% within a year. In 1988 they reintroduced the tax for a second time, result: 19 consecutive losing days, down 43% in less than 3 months. The Independent Budget Office of New York City considered a much smaller transaction tax on just the NYSE and AMEX exchanges and it would result in Net Negative Revenue, with hundreds of thousands of jobs lost. Millions of jobs would be lost if all US exchanges were taxed. And everyone should read about what happened to Sweden when the had the tax for 6 miserable years.

Fortunately there are 120 million Investor Class Voters ready to purge the US Congress.

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