Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
You Should Be Buying Gold Stocks Now - 6th Dec 19
The End of Apple Has Begun - 6th Dec 19
How Much Crude Oil Do You Unknowingly Eat? - 6th Dec 19
Labour vs Tory Manifesto Voter Bribes Impact on UK General Election Forecast - 6th Dec 19
Gold Price Forecast – Has the Recovery Finished? - 6th Dec 19
Precious Metals Ratio Charts - 6th Dec 19
Climate Emergency vs Labour Tree Felling Councils Reality - Sheffield General Election 2019 - 6th Dec 19
What Fake UK Unemployment Statistics Predict for General Election Result 2019 - 6th Dec 19
What UK CPI, RPI and REAL INFLATION Predict for General Election Result 2019 - 5th Dec 19
Supply Crunch Coming as Silver Miners Scale Back - 5th Dec 19
Gold Will Not Surpass Its 1980 Peak - 5th Dec 19
UK House Prices Most Accurate Predictor of UK General Elections - 2019 - 5th Dec 19
7 Year Cycles Can Be Powerful And Gold Just Started One - 5th Dec 19
Lib Dems Winning Election Leaflets War Against Labour - Sheffield Hallam 2019 - 5th Dec 19
Do you like to venture out? Test yourself and see what we propose for you - 5th Dec 19
Great Ways To Make Money Over Time - 5th Dec 19
Calculating Your Personal Cost If Stock, Bond and House Prices Return To Average - 4th Dec 19
Will Labour Government Plant More Tree's than Council's Like Sheffield Fell? - 4th Dec 19
What the UK Economy GDP Growth Rate Predicts for General Election 2019 - 4th Dec 19
Gold, Silver and Stock Market Big Picture: Seat Belts Tightened - 4th Dec 19
Online Presence: What You Need to Know About What Others Know About You - 4th Dec 19
New Company Tip: How To Turn Prospects into Customers with CRM Tech - 4th Dec 19
About To Relive The 2007 US Housing Market Real Estate Crash Again? - 3rd Dec 19
How Far Will Gold Reach Before the Upcoming Reversal? - 3rd Dec 19
Is The Current Stock Market Rally A True Valuation Rally or Euphoria? - 3rd Dec 19
Why Shale Oil Not Viable at $45WTI Anymore, OPEC Can Dictate Price Again - 3rd Dec 19
Lib Dem Election Dodgy Leaflets - Sheffield Hallam Battle General Election 2019 - 3rd Dec 19
Land Rover Discovery Sport Brake Pads Uneven Wear Dash Warning Message at 2mm Mark - 3rd Dec 19
The Rise and Evolution of Bitcoin - 3rd Dec 19
Virtual games and sport, which has one related to the other - 3rd Dec 19
The Narrative About Gold is Changing Again - 2nd Dec 19
Stock Market Liquidity & Volume Diminish – What Next? - 2nd Dec 19
A Complete Guide To Finding The Best CFD Broker - 2nd Dec 19
See You On The Dark Side Of The Moon - 2nd Dec 19
Will Lib Dems Win Sheffield Hallam From Labour? General Election 2019 - 2nd Dec 19
Stock Market Where Are We?  - 1st Dec 19
Will Labour's Insane Manifesto Spending Plans Bankrupt Britain? - 1st Dec 19
Labour vs Tory Manifesto Debt Fuelled Voter Bribes Impact on UK General Election - 30th Nov 19
Growing Inequality Unrest Threatens Mining Industry - 30th Nov 19
Conspiracy Theories Are Killing This Nation - 30th Nov 19
How to Clip a Budgies / Parakeets Wings, Cut / Trim Bird's Flight Feathers - 30th Nov 19
Hidden Failure of SIFI Banks - 29th Nov 19
Use the “Ferrari Pattern” to Predictably Make 431% with IPOs - 29th Nov 19
Tax-Loss Selling Drives Down Gold and Silver Junior Stock Prices - 29th Nov 19
We Are on the Brink of the Second Great Depression - 29th Nov 19
How to Spot REAL Amazon Black Friday Bargains and Avoid FAKE Sales - 29th Nov 19

Market Oracle FREE Newsletter

UK House prices predicting general election result

US Election Investor Political Priorities - A Survey

Politics / US Politics Feb 28, 2008 - 05:04 PM GMT

By: Steve_Selengut

Politics Here we are, in the midst of a presidential campaign, trying to select a new leader for what is still the most economically powerful nation on Earth. The candidates are kissing all the babies they can get their palms on and smiling until their cheek muscles ache; but will they be able to produce any of the changes they talk about? Do we really want them to?

90% of all Americans are investors and, as such, there are issues that we need to hear about from the man who would be king. None of our could-be leaders are addressing the issues that would allow us to achieve our financial goals. What we all want is to keep more of what we make, and then to spend it as we see fit. It's not clear how the candidates intend to help us. Is investor enemy number one a tax, a budding foreign economy, a scarce commodity, the powerful institutions, lobbyists, index funds, or the politicians themselves?

While the campaigns focus on social issues, they purposely ignore the economic realities of their proposals. Politics and Economics are like oil and water; they don't mix well, but both are necessities. The very rich, and the corporations that spawn them, are the biggest contributors to the foundations that fund social change. Increasing their costs and raising their tax liabilities is not going to increase the numbers of jobs they provide or the number of dollars they contribute. Investor enemy number one is an ideology, a class distinction between the super-rich and the not-so-comfortable-yet. You don't help the middle class by stealing from the creative and successful. You do so by increasing their "keep".

Here's a list of candidates for the investor priority number one title. What do you think, and/or what would you add? Please help me prepare a ranking that I can publish before the November elections.

(1) Social Security Reform. If I were to place $2,000 per year in an investment vehicle with a guaranteed interest rate of just 3% per year, I would: accumulate enough money to generate significantly more monthly income than that provided by Social Security, develop significant cash values for my heirs, and have more spending money to pump up the economy. Nothing need be risked in the stock market. My boss would be able to hire additional workers, reduce prices, and increase dividends to shareholders (you). We can keep him from buying a yacht. Thousands of new jobs would be created in an old industry and in supporting areas.

(2) Corporate Income Tax Reform.
Eliminating the Corporate Income Tax without enriching obscenely compensated executives could redistribute enormous amounts of spendable income to all employees, increase the likelihood of job growth in all businesses, reduce the costs of goods and services and, possibly, their prices, and improve payouts to shareholders. It would also reduce the amount of money spent frivolously for tax reasons alone. We can regulate the transition to make it produce these changes, and possibly to reduce the need for offshore outsourcing.

(3) Control Obscene Executive Compensation. This is nothing short of grand theft shareholder, and a basic source of the disrespect so richly deserved by many of today's corporations. Here's a great opportunity for jobs in a new regulatory agency and for public relations consultants. Arbitrary compensation limits would be set for all public companies, and cash only compensation would be allowed... no stock options, unqualified pension benefits, deferred compensation, vacation homes, golden parachutes, etc. Above a certain level, 75% of the excess compensation in any form would be donated in cash to the executives' favorite charities (directly from his or her paycheck) but the donation would not be deductible from any other taxes.

(4) Health Care Reform. Corporations provide health care benefits because it helps them attract and retain employees. The same is true of the 401(k) savings plans and other self-directed gambling devices that have taken the place of defined benefit pension plans. These benefits cut into cash salaries, profits, dividends, and jobs provided, but are thought to be worth the costs in improved morale and retention. Mandating additional or involuntary benefits for employees will either cut something or raise prices. Related issues that must be addressed if health care and/or insurance costs are ever to be brought under control: insurance fraud and tort reform. Known pre-existing conditions are not insurable risks that all insureds should pay for; they are a social welfare concern that must be dealt with by government agencies.

(6) Tort Reform. Lawsuit awards in all areas must be limited to amounts that are reasonable, and people must be held accountable for their own stupidity, irresponsibility, and clumsiness. Potential suits should be reviewed and possibly arbitrated by non-lawyers before going forward. If you spill hot coffee on your lap, be more careful next time. All costs, whether they are insurance settlements or legal fees, find their way into the prices we pay. It's just this simple, the deep pockets are always our own.

(7) Personal Income Tax Reform. Is it enough to say that we tax pension and other retirement income, including the sacred pittance from Social Security. The income tax needs to be revised, reformed, or replaced by something. Eliminating the tax on all forms of retirement and investment income, including capital gains, rents, royalties, etc. would have incredible positive effects (and would guarantee a Pennsylvania Avenue address for eight years). The next administration could earn another eight years by combining the various Flat and Fair Tax proposals. That could double total tax revenues, reduce price levels, create/save thousands of jobs, and expand the economy.

(8) Regulate The Regulators.
Every scandal produces new levels of regulations and additional cadres of secret police who raise business costs in the name of compliance with da law. Countless hours of non-productive time are mandated by broad-brush policies and procedural requirements that do little to protect the consumer--- in many cases they simply annoy the people they are supposed to assist. Financial services firms, for example, employ thousands of people to protect the firm from the examiners, not to protect the client from unscrupulous employees. I've heard similar stories of the abuse of power that seems to be SOP in most regulatory agencies.

(9) Change Exchange Traded Index Funds. Index ETFs have replaced plain vanilla mutual funds as the most popular form of speculation in the financial world today--- even more popular than sub-prime mortgage paper was just a few months ago, and with the same risks. These are glorified gambling mechanisms whose price movements have little to do with the economics (or economies) of the companies inside. Stock prices are pushed up by demand for the indices, not by their fundamentals.

(10) Restore the Up-Tick Rule. The up-tick rule that applied to short selling since 1929 was eliminated in July of 2007; the markets have been feeling the impact ever since. Theoretically, if not actually, unscrupulous persons could bring target companies to their financial knees for their own purposes. In the wake of the sub-prime mess, for example, it became difficult for some companies involved to raise capital efficiently because of shorting tactics employed by hedge fund operators.

This is my short list for the presidential candidates. Where they stand on these issues will certainly influence our economic future. Which of these is most important? I think that either Social Security Reform or the elimination of all taxes on retirement and investment income would have the biggest and most lasting impact. What do you think? Really, let me know what you think.

By Steve Selengut
Professional Portfolio Management since 1979
Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Disclaimer : Anything presented here is simply the opinion of Steve Selengut and should not be construed as anything else. One of the fascinating things about investing is that there are so many differing approaches, theories, and strategies. We encourage you to do your homework.

Steve Selengut Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules