Written by Mark Hulbert, who is famous with his review of Newsletters in the Hulbert Financial Digest, the article commented:
"Consider the data compiled by Ned Davis Research, an institutional research firm. In a communication to his clients Thursday morning, Davis reported that the Dow Jones Industrial Average ($INDU) produced an annualized return of 7.21% during Democratic presidents, in contrast to an average of 3.6% during Republican presidents -- or almost precisely half as much, in other words."
But isn't Larry Kudlow correct when he wrote:
"McCain is also good news for business and the stock market. He wants to cut the corporate tax and keep dividend and cap-gains tax rates low. He's tough as nails on restraining government spending and blowing up earmarks. On top of all this, he's a very strong free trader who knows America can compete with the rest of the world.Stock market fears about a new wave of tax hikes should be put aside. It ain't gonna happen after McCain is sworn in. Neither will protectionism. So far as I can tell, high taxes and diminished free trade are the biggest worries for business and stocks. Investors can cast their fears aside."
But would an Obama Presidency actually be better for stocks than an administration led by John McCain?
And what about Lowell Ponte who wrote for Newsmax that 'Democrats Are Wrecking the Economy''? He wrote:
"The more that Americans fear losing their jobs and facing economic bad times, the more they can be bamboozled into voting for Democrats — who, in fact, are the biggest cause of the economic problems people fear.
The mere existence of this socialist political party puts a drag on our economy because investors must always hedge defensively against a Democratic takeover of the government.
Do working people understand that every time they vote for any Democratic candidate, they weaken the economy, raise the price they must pay for food and other goods, and undermine future opportunities for their own children?"
Or as conservative Deroy Murdock wrote for the conservative website Human Events:
"While America's economy clings from a ledge, Democrats dance on its fingertips. When the donkey party promises "change," it delivers -- good and hard."
Conservative talk show host Jerry Bowyer has had this to say:
"I don't think that the current Dow bear market was caused by last August's credit crunch. Nor do I believe it's being caused by a recession that is allegedly starting right now (having failed to appear in the first or second quarter). Stocks are forward looking; when they drop now, it means investors are worried about things that are coming later — 6 to 9 months later. In other words, they're worried about Obama.
And why shouldn't they be. He's promised to erase Bush's investor tax cuts. That means a hike in the tax rates for dividends and capital gains. This means very large additional levies directly on investors. Of course this affects stock prices. It is ludicrous to suggest that adding a tax directly on an asset class would have no effect on the value assigned to that asset. Add to that harrowing scenario our already high levels of inflation, which the tax code treats as a gain, even though it isn't one, and we're getting to some very high tax rates on capital. This is happening just as most of the developed world has been cutting its cost of capital."
Oh really?
Massive deficits? War without end? In 2003, Secretary of the Treasury started talking down the dollar:
"There were horrified reactions this week when John W. Snow allowed that he was ''not particularly concerned'' about recent weakness of the dollar. ''The dollar is going to rise and fall some,'' he said. ''There's nothing unusual about this, nothing alarming about it.'' The dollar promptly slipped and commentators started talking about Mr. Snow's gaffe, which was compared to all the ones supposedly committed by his predecessor, Paul H. O'Neill."
So where is the dollar now?
How about near a record low. As reported today:
"NEW YORK (AP) -- The U.S. dollar fell close to record lows against the euro Friday, as fears continued that the entities that underpin the U.S. mortgage market may fail.The 15-nation euro bought $1.5925 in late New York trading, above the $1.5783 it bought Thursday. The dollar is now less than $0.01 of its record low of $160.18 set in April.
The British pound climbed higher, too, buying $1.9928 compared with $1.9775."
And out nation's finances? How about this point made by a reader of the Des Moines Register:
Meanwhile, the rich get richer and the poor poorer. As reported:"The biggest deficit spender of all time, though, is George W. Bush. Nearly half of our $9 trillion national debt was amassed under his administration. When he took office, he inherited the largest budget surplus of all time. Over the next six years he and his Republican Congress gave us the biggest budget deficit of all time."
"Over the last 20 years, the net worth of the top two percentile of American families nearly doubled, from $1,071,000 in 1984 to $2,100,500 in 2005. But the poorest quarter of American families lost ground over the same period, with their 2005 net worth below their 1984 net worth, measured in constant 2005 dollars.The poorest ten percent of families actually had a negative net worth---more liabilities than assets. The poorest 5 percent of American households had a negative net worth of a little more than $1,000 in 1984, compared to nearly $9,000 in 2005."
And President Bush gets the Republican Congress to cut taxes favoring the wealthy:
"Based on an exhaustive analysis of tax records and census data, the study reinforced the sense that while Mr. Bush's tax cuts reduced rates for people at every income level, they offered the biggest benefits by far to people at the very top — especially the top 1 percent of income earners.
Though tax cuts for the rich were bigger than those for other groups, the wealthiest families paid a bigger share of total taxes. That is because their incomes have climbed far more rapidly, and the gap between rich and poor has widened in the last several years."
Clearly, the irresponsible tax cuts with mounting deficits and a declining dollar are not good for the economy. It isn't that traditional Republican values are bad for stocks; it is that what is passed by as Republican economics is a sham. It involves cutting taxes without cutting expenditures. It involves no bid contracts to military industrial friends. It involves privatization efforts of every aspect of government whether or not it is cost effective or good for America.
I am not surprised about the difference between Democrats and Republicans in the White House.
I look forward to the Inauguration in January, 2009, as an amateur investor, tired of a decade of no gains in my portfolio, lagging values in my 401K and 403B and the hardship of the American people while the wealthiest among us enjoy the fruits of this activity.
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Comments: 10
Also as a side for people, and I'm too lazy to go verify numbers; a big budget deficit in dollars and terms such as "record highs" mean nothing in itself. Even inflation alone can make a new record "number", with no real increase in spending. Say your debt doubled last year, but your income grew five times higher at the same time. Is your debt as big a problem as it was? Figures alone are too easy to play with...
My Theory, the Dems run the country as a Stimulas package. Help to the lower income who quickly spend money and give the economy a boost.
It's a trickle up economy under Dems.
I also was taken aback why the comment that Jerry Bowyer made, I guess that he was in a cave in the 90's. When you look at the highs of the 90's and the highs of the Bush years, and they don't even come close. With low taxes, low regulation, and no governemnt intervention, the stock market, and the economy has lost all of the gains made in the 90's. The fear mongering of people like Mr. Bowyer should be attacked with facts, when you look at comments like his, they sound good, but there is no facts to back it up.
One of the things that we have learned from the Bush administarting is how important it is to have a good treasury secretary. Bush has had nothing but incompetent secretaries, and they have hurt our economy more than anything that democrats, or congress have done.
Speaking of John Snow, on Friday I was listening to CNBC while everything was going on with Freddie Mac, and Fannie May, someone from Bloomberg Financial spoke with Mr. Snow about the current crisis. He said that he didn't think that the government should step in and save the two companies, and felt it would be better for both to fail. Now, this is the same man that has a very generous retirment plan from CSX worth about $30 million for his work as CEO, while he was CEO of CSX sales were down over 20%, and this while the rest of the industry was growing. So how did CSX compensate their CEO that wasn't doing the same job that the rest of the CEO's in the industry were doing? They paid him more than double what any other CEO was making. By the way, the profits of CSX are up since Snow lefft, CSX still receives Billions in tax payer money. So I guess that Snow didn't mind spending tax payer dollars on his company when it was run so bad, but doesn't think that the American should do this for anyone else.
pure commie crapola bud---
I see this all too often from both sides of the political fence- whatever that means.