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5 Reasons Wall Street Is Worried
Pajamas Media ^ | March 7 | Victor Davis Hanson

Posted on 03/07/2009 9:15:42 AM PST by AJKauf

1) The proverbial Wall Street capitalists believe that, with new federal income tax rates, the removal of FICA ceilings, increases in capital gains rates, decreases in deductions, and simultaneous tax raises, not only will Obama remove incentives for innovation and productivity, but that he does not seem to care about—or perhaps appreciate—he consequences?

2) On the spending side, investors see too many subsidies and entitlements that may Europeanize the populace and erode incentives, while creating so much debt that in the next decade, should interest rates rise, the federal budget will be consumed with servicing borrowing and entitlement obligations. A redistributive economy in which government ensures an equality of result is Wall Street’s worst nightmare. Debt can only be paid back by floating more foreign debt, issuing more US bonds at home, raising taxes, or printing money—all bad options in the mind of the investor.

3) Too many are beginning to think Obama is, well, a naïf—and hence dangerous. He chest-thumps speeches Geithner cannot deliver. He says we are near the Great Depression—but then, after the stimulus..

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


TOPICS: Politics/Elections
KEYWORDS: bho2009; democrats; economy; obamanomics; vdh; victordavishanson; zeronomics
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To: EagleUSA

Yes, Obama hates America. Barney Frank hates America (as all homosexuals do). The two together have created the Barry/Barney market. There is nothing we can do about it. They have won.


21 posted on 03/07/2009 9:41:48 AM PST by abclily
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To: AJKauf
"... too many subsidies and entitlements"..."

This creates another market fear (which Cramer seems to be alluding to), i.e. to make up for funding shortages, the Government will turn to dictating drug and medical company pricing. This of course will lead to bankruptcy, at which time the Government will dictate development and production policy.

This is similar to what has happened to the auto industry as a result of the CAFE standards. Investors fear that industries related to the subsidized and entitled programs will come under government control.

THE BRIGHT SIDE! - If Americans can begin to understand this process, they will GET how socialism is so damaging.

22 posted on 03/07/2009 9:45:39 AM PST by LZ_Bayonet (There's Always Something.............And there's always something worse!)
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To: stylin_geek

Yeah, beyond a certain point, FICA is not collected. I think the ceiling is around $110,000 but not sure.


This is been on the agenda by the rats for a long time. They can say the didn’t raise tax rates...............


23 posted on 03/07/2009 9:45:48 AM PST by PeterPrinciple ( Seeking the truth here folks.)
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To: silverleaf
FICA ceilings are removed?

Wonderful. My tally of damage can now rise from $17,000 to $20,000 of after tax income removed from my annual household budget when these changes take effect. Paying off the social security maximum in September has left me about $1,000 per month of extra income at the end of the year. That's the same part of the year that merchants desperately hope to get back into the "black" from holiday spending. The merchants can count me out for helping with better sales with Obama's crushing increase in taxes.

24 posted on 03/07/2009 9:46:24 AM PST by Myrddin
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To: null and void

Can you say “Weimar Republic?” I knew you could............


25 posted on 03/07/2009 9:46:54 AM PST by stylin_geek (Liberalism: comparable to a chicken with its head cut off, but with more spastic motions)
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To: scooby321

I offered this exact scenario to my eighth grade science class last year. I wanted to see how many of the kids would want to divide the points equally so everyone had the same chance. They gave it a resounding thumbs down with the exception of the lowest grades. One girl even verbalized something to the effect:”I’m not giving my points to the lazy bums in this class!!!” I smiled and told her she would never make a good communist!


26 posted on 03/07/2009 9:47:40 AM PST by karatemom (Jesus saves.)
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To: PeterPrinciple

The ceiling this year is $106,800


27 posted on 03/07/2009 9:52:10 AM PST by SnarlinCubBear (Sarcasma - Comforting relief from the use of irony, mocking and conveying contempt)
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To: AJKauf

Good article. Worth reading the whole piece.


28 posted on 03/07/2009 9:53:44 AM PST by Girlene
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To: edcoil
Anyone with an ounce of brains was out of the market 2,500 points ago. The problem is those that have 401K that cannot get out. The brokers are making money trading these down and people are losing them - most of the employees where I work have asked to close their 401K and move to IRA’s but they have been rejected due to not meeting the requirements.

I took some money out at the end of last year, but I didn't want to liquidate all my class A preferred. It is taking a bit of beating, but is still fairly valuable. The 401K is wrapped up in a lot of elements that I can't change or liquidate. It's getting hammered too. The mere fact that my company offers a "qualified" plan excludes me from making pre-tax IRA contributions. When the taxes make a sudden jump, there won't be money left to invest.

29 posted on 03/07/2009 9:54:03 AM PST by Myrddin
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To: AJKauf

“The proverbial Wall Street capitalists”

Who are they?

Let’s see some detail:

A list of names - individual and corporate

Who they supported in the election

How much they donated to Obama


30 posted on 03/07/2009 9:55:59 AM PST by Iron Munro (Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself.)
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To: abclily
Barney Frank hates America (as all homosexuals do).

I know ones who are passionate about their love of America. Granted, not many, but there are some.

31 posted on 03/07/2009 9:59:36 AM PST by null and void (We are now in day 45 of our national holiday from reality.)
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To: Myrddin

Once again, you have gotten there first...

I hate January. The loss of pay floors me.


32 posted on 03/07/2009 10:03:51 AM PST by patton (America is born in Iceland, and dies in California)
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To: SnarlinCubBear
The ceiling this year is $106,800

Again, most of our politicians don't run a business so this won't affect them. They do have rent and investment income so that is safe from ss tax. Lawyers have sub s corps and pay ss tax on the wage part but not the distribution above the wage. Wonder if the rules will change for sub s corporations? Keep your eyes on that, if not, we will have a lot of sub s corps and tax collections will not go up.
33 posted on 03/07/2009 10:06:00 AM PST by PeterPrinciple ( Seeking the truth here folks.)
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To: AJKauf
Speech today: "Obama: Crisis is time of `great opportunity'"

Article Comment:
"I predict Obama will face public demands for his impeachment, if he fails to mend his ways."

People expect Obama to be driving us "back to the house", but he's telling us we have a 'new house', in "Socialismville", and that's where he's driving us instead. He repeats over and over, "You'll like it there."

Impeachment is certainly at the "thinkable" stage.

34 posted on 03/07/2009 10:06:32 AM PST by LZ_Bayonet (There's Always Something.............And there's always something worse!)
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To: karatemom

We need more teachers like you.

How did you ever get past the PC Police?


35 posted on 03/07/2009 10:08:45 AM PST by Iron Munro (Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself.)
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To: stylin_geek
vi'mär ri pub'lik...
36 posted on 03/07/2009 10:10:25 AM PST by null and void (We are now in day 45 of our national holiday from reality.)
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To: AJKauf
When the bond market breaks, because we are borrowing all the money for this from foreigners, the USA government will be bankrupt. By the spending we are doing, and borrowing to pay for it, we are pulling forward the day of reckoning for Social security and Medicare which are bankrupt.

We are doing the equivalent at the moment of someone in credit card trouble. We are surfing the national debt, from place to place, trying to find lower interest rates, and charging the back interest on the debt which we cannot pay while trying to cover up how bad it is. We are also still spending and charging it. At some point this house of cards is going to collapse. The more spending we do the sooner it will happen. This is not paranoia. It is a simple matter of the mathematics of the situation.

What we are doing is going to bankrupt the country and all the entitlement programs. The Federal government is in as bad a shape as California. Tax revenues are falling. With job losses comes a loss of personal and corporate income taxes. Pension plans of other corporations, not just GM, but GE and others are going to blow up as their stock prices decline, their ability to borrow, and run their business is destroyed. State and city plans also are under funded and will implode.

This is the crisis Obama and Rahm Immanuel think they can manage. They are wrong.

"The problem with socialism is that eventually you run out of other people's money." - Margret Thatcher

37 posted on 03/07/2009 10:27:43 AM PST by verklaring (Pyrite is not gold))
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To: Iron Munro

I teach in a private Christian school! I did an abridged economics lesson last week when I had some time left over after my algebra class. I gave one girl-the same one, in fact!- a $100 bill. By the end of lesson she was no longer the “evil rich” but the one buying the goods and services of the others in the class. I asked what her tax rate should be, and one boy said 90%. It was pretty easy to show how our little classroom “economy” shrank rapidly. Man, I looooove my job!
BTW-I got that $ back :)


38 posted on 03/07/2009 10:45:23 AM PST by karatemom (Jesus saves.)
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To: Scanian

To me and a few other people around here, the danger has to do with him trying to drive down the market so that the government can nationalize the corporations of their choice at cut-rate prices. That theory seems to corrolate well with Zer0’s behavior. Socialism to the max.
::::::::::
I would agree. It it quite obvious. But where is the LOUD OUTCRY from the Repubs in Congress???? Why are they not screaming bloody hell about this?? They should be — Obama is DOING NOTHING to help our economy — AND THEY LET HIM GET AWAY WITH HIS STREAM OF LIES about it.

Who cares if the socialists have a majority in Congress — the Repubs could STILL BE FIGHTING IT. They could be screaming IMPEACHEMENT, MALFEASANCE, ABUSE OF POWER, anything — just like the rottem media did every time Bush farted. Where is the fight to SAVE AMERICA from a twisted radical Marxist who hates everything about this country???


39 posted on 03/07/2009 10:45:47 AM PST by EagleUSA
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To: Tolik

-ping-


40 posted on 03/07/2009 10:48:44 AM PST by rellimpank (--don't believe anything the MSM tells you about firearms or explosives--NRA Benefactor)
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