Posted on 10/16/2010 10:33:41 AM PDT by WebFocus
The Republicans seem headed for victory in next month's elections. Pollsters say they are likely to take control of the House of Representatives, after a four-year gap, and they might even win control of the Senate.
What might this mean for investors?
It's still early. What we don't know about the future is probably more important than what we do know. But one thing seems clear: A Republican victory makes it even more likely that the 2001 and 2003 Bush tax cuts will get extended, perhaps indefinitely. While President Barack Obama and the Democrats want to extend the cuts for households making less than $250,000 a year, the Republicans want to extend them for everyone.
And, all other things being equal, that's probably negative news for bonds and the dollar, but better news for stocks and gold.
Why?
Look at the budget math and the politics.
GOP leaders in the House of Representatives—led by Minority Leader John Boehner—have already said they want to extend the cuts for at least two years. Senate Republicans unveiled a plan to make them permanent. Most Republicans would probably like to go along. Why wouldn't they? Party orthodoxy opposes any tax hike, on economic and political grounds. The fate of George Bush the first beckons for any Republican politician who breaks with the orthodoxy.
Yet the federal budget is already mired in red ink. The Congressional Budget Office forecasts that over the next 10 years, we will add $6.2 trillion to the national debt. But that's if the Bush tax cuts expire. Making those cuts permanent would cost another $4.8 trillion, taking the total to $11 trillion.
(Excerpt) Read more at online.wsj.com ...
I have a feeling that even if the GOP wins 240 House seats and take a Senate majority the MSM will try to say it wasn’t “as big a margin as expected”.
The MSM in a tough position over this. If they attempt to keep Dem voters hopes alive then they'll be set up for a huge let down come election day. On the other hand if they try to prepare for the blow by lowering Dem expectations they risk demoralizing Dem voter turnout and creating a huge bloodbath.
They can do more then just extend the tax cuts. They can defund Obamacare, they can unfund any of the stimulus money that has not been spent, they can haul up the heads of the various agencies who will be trying to implement law without consent of congress into committee meetings and defund their agencies. They can do a lot to cut costs.
It isn’t the red ink that kills, it is the total amount wasted on government. Running expenditures at 25% GDP is what is collapsing the system, not the Bush tax reductions.
If keeping the tax cuts boost hiring I’m all for it. People on unemployment pay very little taxes and that is more harmful to revenue then having those that work pay a lower rate.
Watching them try to downplay a GOP victory is going to be funny, and annoying.
Oh MSNBC will be can't miss TV during election week. :)
Madcow, Oberdork, Chrissy and FatEddie will all be drunk on election night. lol.
Whom do you think voters will give credit to for a positive ‘change’ in the economy?
1.) Obama will not move to the center.
2.) Ryan/Boenher will send a bill with greatly stripped down cost, it will get Vetoed.
.3.) Gov't shutdown will insue, GOP blamed, potential of civil unrest with the whole progressive universe seeing their chance and striking.
4.) Standoff goes on for two years, Mkts do not like uncertainty, they drift as only budget continuations keep the machine barely running.
5.) The only good news is a stop to new legislation, again the markets drift with no solution as to their roll back.
6.) Tea Party ferver stays high as Obama tries to run the country and inact legislation like cap and trade via Executive Order...
IMHO things may get so bad that Obama either uses the "F-Bomb" or some other event where he looses his temper enough in public like Ray Nagan did and it may be so bad that the Dem's may have to go to the Oval Office like Goldwater and Dole did for Nixon and ask him, "Barry it is time to go"....
It won't take them long to switch gears and tell us why this GOP sweep will all but guarantee Obama's reelection.
ALL of TV supports the elites, O and Islam. The public has no clue and thinks “well Fox is our friend.”
TV controls the public.
Roll back the budget to 2005 levels!
2000 United States federal budget - $1.8 trillion
2001 United States federal budget - $1.9 trillion
2002 United States federal budget - $2.0 trillion
2003 United States federal budget - $2.2 trillion
2004 United States federal budget - $2.3 trillion
2005 United States federal budget - $2.4 trillion
2006 United States federal budget - $2.7 trillion
Democrats retake Congress
2007 United States federal budget - $2.8 trillion
2008 United States federal budget - $2.9 trillion
Obama, Peliso and Reid
2009 United States federal budget - $3.1 trillion
2010 United States federal budget - $3.6 trillion
One reason I so look forward to a Rep House & Senate is when all hell breaks loose in the ME in the next 2 yrs (& gas goes to $4, $5 gal), the Reps will push forth for more domestic drilling for national security reasons & to create jobs.
If Obama vetoes it, 2012 will be a landslide worse than Mondale.
IMHO things may get so bad that Obama either uses the “F-Bomb” or some other event where he looses his temper enough in public like Ray Nagan did and it may be so bad that the Dem’s may have to go to the Oval Office like Goldwater and Dole did for Nixon and ask him, “Barry it is time to go”....
I hope and pray this will be the second President I see resign in my lifetime. It has been too many years since the last one Nixon . . . Clinton should have or been kicked out . . . so we are OVERDUE.
It won’t mean much.
Gridlock and vetoes is the agenda for the next two years.
The only legislation that will pass will be continuing resolutions and periodic raises in the national debt.
how about a 100% freeze on all government jobs, both in # and in raises as a good start. a top to bottom rigorous review of each and every pet government agency to see if it can be reduced or eliminated?
Oh, defunding of czars
there will be many. many congressional inquiries into the czars and payoffs orchestrated by the Obamas that will bring down the ability for Obama to do anything but play golf.
good for America
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