Anyone following the reasons behind America’s stalled recovery knows that American business is not investing, expanding or hiring. It certainly isn’t for a lack of funds – the coffers are filled with cash… business is sitting on $2.8 trillion, by last count.
I have believed for some time that our economy is suffering from confidence about the future, and uncertainty about coming tax hikes, new government rules and regulations – both known and unknown, a U.S. dollar being continually weakened by those responsible for protecting it.
A few days ago I sent an email to a longtime friend, an American retiree who left the U.S. years ago, lived for awhile in Costa Rica, and now lives in Panama. I wanted him to see this week’s comments from Intel CEO Paul Ottelini – an all-too-rare American business leader finally speaking his spoke his mind about the Obama-nable policies of this government and what those policies are doing to America. The reports about a speech in which Ottellini made his comments included this:
The U.S. legal environment has become so hostile to business, Otellini said, that there is likely to be “an inevitable erosion and shift of wealth, much like we’re seeing today in Europe–this is the bitter truth.”
My friend’s reply:
“Interesting… it explains the Microsoft plant in Costa Rica and the P&G and Caterpillar plants here in Panama.”
So my prediction is this:
1) If the Democrats hold Congress on Nov. 2, look for the recession to continue until Obama and/or Congress gets off the back of the producers in our society, and shows some sign of fiscal sanity.
2) If the Republicans take one or both houses of Congress, look for things to take an initial upswing, followed by a cautious period beginning with the start of the new Congress, during which businesses – like all of us – will be waiting to see if the Republicans are going to do anything differently than the Democrats.
If the Republicans win and the market’s still down… it might be a good time to cautiously buy.