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Steve Forbes : Yay, Stocks!
Forbes ^ | January 17,2009 | Steve Forbes

Posted on 01/17/2009 7:00:43 PM PST by SeekAndFind

Amazingly, equities will end the year up. Most shareholders will experience something they've forgotten existed: capital gains. True, the economy is now in a bad slump, and the Obama initiatives (see below) will do little, if any, long-term good. But the forces of recovery will break through. As they always do, stocks will rise before the economy does. There will be volatility aplenty, but imperturbable bulls will be smiling a year from now.

Big Bar to Robust Recovery: Bad Ideas

The U.S. is enacting a "stimulus" program of gargantuan peacetime proportions to rejuvenate our recessed economy. We are not alone in this. Japan, China, Europe and numerous other nations are doing the same--not yet as big as our program but based on the idea that governments can rekindle growth.

It's all mostly wasted effort.

Governments are indeed critical to economic growth--but not in the manner we see unfolding here. While times and circumstances change, principles of economic growth do not. The basic ones have stood the test of time:

--The rule of law, especially property rights.

--Money that is stable in value, which the dollar manifestly has not been.

--Low tax rates.

--Ease of starting a new business.

--Minimal barriers to doing business, whether overseas (low or no trade barriers) or domestic (no internal cartels or onerous licensing procedures).

Despite its sheer size, the impact of the new President's fiscal program, after the initial euphoria, will be painfully limited. Instead of a jolt like from downing a six-pack of Red Bull, we'll get the economic equivalent of a tepid cup of decaffeinated tea. In fact, the waste and misuse of much of the money--inevitable in any quick, massive government-managed or -directed program--will negate much of the good in parts of this infrastructure-spending package.

(Excerpt) Read more at forbes.com ...


TOPICS: Business/Economy; Culture/Society; Editorial; News/Current Events
KEYWORDS: financialcrisis; forbes; stocks
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To: blam
"My neighbor just bought 15 cases of canning jars and spent (he said) about $450.00 on pressure cookers..."

You only need the pressure cooker if you are canning meats or eggs. Fruits and vegies can well with an ordinary porcelain cauldron. The lids, rings, and jars are definately a smart buy, unless your place is in a warm climate. We definately are looking at 3 or 4 years of sharply declining temps.

21 posted on 01/17/2009 8:37:58 PM PST by editor-surveyor (The beginning of the O'Bummer administration looks a lot like the end of the Nixon administration)
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To: SeekAndFind

*


22 posted on 01/17/2009 8:39:53 PM PST by Sam Cree (absolute reality)
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To: editor-surveyor
" The lids, rings, and jars are definately a smart buy, unless your place is in a warm climate. "

Mobile, is that warm enough, lol.

"We definately are looking at 3 or 4 years of sharply declining temps."

You mean the weather temps?

23 posted on 01/17/2009 8:41:38 PM PST by blam
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To: yefragetuwrabrumuy

Your post is cogent, salient, and even optimistic.

I will not postulate as to the economic future of this nation. However, I am an ant.


24 posted on 01/17/2009 9:21:47 PM PST by Hilltop (Control the high ground. Control the battlefield.)
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To: blam

Yes.


25 posted on 01/17/2009 10:06:48 PM PST by editor-surveyor (The beginning of the O'Bummer administration looks a lot like the end of the Nixon administration)
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To: editor-surveyor; blam
You only need the pressure cooker if you are canning meats or eggs. Fruits and vegies can well with an ordinary porcelain cauldron.

I'm just starting to learn about all this myself, but I think most veggies need a pressure cooker as well. If the food is very acidic, the acid will help prevent bacteria growth, but if they are low-acid foods you need to pressurize.

So fruits can be canned without pressure, and tomatoes too, which are very acidic. But I believe something like carrots needs to be pressurized--unless you pickle them in vinegar which is acidic. Of course, carrots keep in a root cellar, so you might not even need to can.

26 posted on 01/18/2009 4:38:42 AM PST by Claud
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To: MaxMax
Wow, everything will be grand after 0bama is President.

The media will be cheer leading 0 for a while yet. That will result in a 0 bump in the markets. Sustainable or not it is hard to tell but it will affect real money. I moved some out of money markets into equities on Friday to capture some of the drunken euphoria. Nothing major, just a toe in the water.

27 posted on 01/18/2009 5:00:25 AM PST by Malsua
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To: Uncle Miltie

“Reminds me of why I was a Forbes booster.”

Never supported his presidential run, but Forbes exudes what every conservative should nurture in abundance - optimism. President Reagan had it and washed away the Carter malaise in less than two years.

The gloom & doom parades marching thru FR do little good.


28 posted on 01/18/2009 5:47:01 AM PST by sergeantdave (Michigan is a bigger mistake than your state.)
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To: The Duke

The reason I say it’s hit the rich disproportionately, is simple. They own the stocks that are now worth 1/2 what they were worth. They own a lot of the real estate which is now worth a fraction of what it was worth. For the most part, this debacle has taken the form of a decline in the value of assets. And who owns the assets? The rich.


29 posted on 01/18/2009 6:10:07 AM PST by Brilliant
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To: CheezyChesster

I don’t feel sorry for the rich. I’m just observing that if you don’t own stock or real estate, then you are not much affected by this recession, provided that you don’t lose your job. In fact, the lower incomes who don’t own real estate or stock might be better off as a result of this recession, assuming they have a job. Gas is cheaper, food prices have stopped escalating. Housing is cheaper.


30 posted on 01/18/2009 6:13:49 AM PST by Brilliant
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To: Brilliant

But unless they sold, they still own. The value has declined but the assets are not gone...... except of course some companies who died


31 posted on 01/18/2009 6:19:46 AM PST by bert (K.E. N.P. +12 . The original point of America was not to be Europe)
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To: blam
The Government and the Bank of England have got "days not weeks" to take action to revive the economy or face a prolonged depression, one of the UK's leading economists has warned.

Sounds like Henry Paulson. Unless your house is on fire, it is prudent to distrust anyone who hustles desperate action based on urgency. It is the cardinal warning flag of a con artist at work.

32 posted on 01/18/2009 8:50:36 AM PST by hinckley buzzard
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To: SeekAndFind
--The rule of law, especially property rights.

--Money that is stable in value, which the dollar manifestly has not been.

--Low tax rates.

--Ease of starting a new business.

--Minimal barriers to doing business, whether overseas (low or no trade barriers) or domestic (no internal cartels or onerous licensing procedures).

None of these are present in today's America. What does that say about our chances?

33 posted on 01/18/2009 8:53:41 AM PST by Republic of Texas (Socialism Always Fails)
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To: editor-surveyor
Smart money has the market at 5500 by mid summer

That's a bit sooner than I would have said, but the target sounds about right. I think it will be well on its way down by summer, but hit bottom closer to Fall.

We shall see.

34 posted on 01/18/2009 8:55:20 AM PST by hinckley buzzard
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To: sergeantdave
Forbes exudes what every conservative should nurture in abundance - optimism. President Reagan had it and washed away the Carter malaise in less than two years. The gloom & doom parades marching thru FR do little good.

Reagan was president, now we have Obama. Big difference. Reagan also had Paul Volker at the Fed to break the inflationary cycle. Obama is going to fuel hyperinflation. Big difference.

Optimism is great but realism is what gets you to cut your losses and preserve your capital.

The optimists are still holding portfolios and mutual funds that have cratered and may take a decade to come back, if ever.

35 posted on 01/18/2009 9:04:23 AM PST by hinckley buzzard
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To: Uncle Miltie

Same here. And a great guy.


36 posted on 01/18/2009 12:16:04 PM PST by GOP_Lady
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To: SeekAndFind
I'll get back to you when my stocks go back up.
37 posted on 01/18/2009 2:49:21 PM PST by Ciexyz (Downloaded Ann Coulter's "Guilty" to my Amazon Kindle for $9.99 - 67% discount.)
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