Your Wallet and the 2010 Election Tsunami

Filed in depression, economy, GOld juniors, mongolia by on November 3, 2010 0 Comments

It wasn’t exactly pitch forks and torches yesterday, but after an election cycle of heated debates, the electoral tsunami finally arrived. Using the power of the ballot box, Americans decided to rearrange the map again — proving the anti-establishment wave is as deep and powerful as it has ever been. And while neither camp can actually claim the high ground this morning, the good news for investors is the divided government that will follow in its wake. After all, equity markets have historically favored gridlock by a pretty wide margin… In fact since 1970, the S&P 500 has grown at a median rate of 13.5% per year in the face of divided government, versus a gain of just 9% during times of one-party control. Now how about those tax cuts? In the meantime, though, the lame duck session is chock-full of question marks, namely in regards to the tax cuts. As I wrote back in July, the tax hammer is about to fall. Without action, Uncle Sam will be at it again, doing his best to separate you from your money when the ball drops in Times Square—regardless of what happened in yesterday’s election… And like a great hurricane off somewhere in the Atlantic, the storm will finally arrive. When it does, you’ll have less money in your pocket to stare down the worst economy since the Great Depression. If Congress fails to act, the income tax rate clock will be turned back to the higher levels of June 2001. Thus, U.S. employers across the country are already beginning to prepare their employees for much smaller paychecks as the tax question still goes unanswered… According to calculations by H&R Block, married couples with an income of $80,000 can look forward to $442.96 less in their paychecks each month …

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Your Wallet and the 2010 Election Tsunami

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