The President wants us all to start investing in the stock market:
President Obama told Americans to take a look at investing in the stock market this afternoon, a remarkable utterance for an American president, especially as the Dow Jones Industrial Average proceeds on its course Southward.
“What you’re now seeing is … profit and earning ratios are starting to get to the point where buying stocks is a potentially good deal if you’ve got a long-term perspective on it,” the president said on a day that trading continued to hover under 7,000.
(Hat Tip: Reformed Chicks Babbling.)
Wow and he’s a financial planner too.
Thanks for the advice, Mr. President. And in this case, the President is right if you can predict which companies won’t be nationalized or destroyed by the current Administration. Those of us who are long term investors (my Stock and Mutual fund money is all in retirement which is thankfully a long way aware) are staying where we’ve always been.
However, if the President truly wants us to invest, he seems to have a funny way of going about it. If you buy stocks now at the bottom, you could make a killing. If you do, President Obama’s going to be waiting with an increase in your capital gains tax rate. Oh, but there’s more. In 2011, he also wants to increase corporate taxes by $353 billion. What does that mean for you as a shareholder? A smaller pot for the company to award dividends from once companies return to profitability.
Oh and then if you’re going to buy a stock now, you better hope it’s not going to be hit by whatever Obama does with health care, or that fuel prices don’t skyrocket as Obama is removing tax incentives towards energy production and changing accounting methods for energy companies in ways that will drive up their costs.
Investors are panicking, and it’s not a partisan thing. I’ve chronicled how Jim Cramer, who gave $120,000 to Democrats in the 1990s (when some Democrats were actually pro-business) is in the midst of a series of how to make your portfolio “Obama resistant.” Cramer’s tip was that you need money that’s outside the United States and “out of the reach of Obama.”
President Obama declared that now is not the time for profits. And guess what? If it’s not time for profits, for most people, it’s not time for investing.
Meanwhile, those who are more than $250,000 a year are making plans to start working less in 2011 to escape the President’s new big tax increase:
“President Barack Obama’s tax proposal – which promises to increase taxes for those families with incomes of $250,000 or more — has some Americans brainstorming ways to decrease their pay.
“I’ve put thought into how to get under $250,000,” said Poczatek. “It would mean working fewer days which means having fewer employees, seeing fewer patients and taking time off.”
“Generally it means being less productive,” she said.
(Hat Tip: Magic Valley Mormon.)
What you tax, you get less of. What you subsidize, you get more of. Well, Obama’s decided to tax success. Successful people won’t be working as much, and you can bet they won’t be investing as much.
Wall Street has undermined it’s own credibility, but the Democrats haven’t helped. Even the idea of allowing Americans to invest some of their social security in the same mutual funds that government employees used has been attacked as risky and dangerous. Democrats would rather people not be investors, they’d rather they live large, spend their money now, and end up entirely dependent on government come retirement.
Those people who haven’t been investors in the past are probably not going to jump in. Those who have backed off on investments are nervous because this Administration is not only liberal, it’s unpredictable what they’ll do next and what actions they’ll take that will harm the economy.
Obama’s in trouble. If somebody doesn’t start investing, somebody start making money, and the time for making profits come in the next few years, America’s recovery will come. He just won’t be the one to preside over it.