Monday, November 03, 2008

No Winners this Election

It's hard to forecast the election one way or the other for tomorrow, but do get out and vote. The rest of the world has no real idea what the election is all about. It has no meaning to them. They will be waiting to see what our reaction to the election is. That will be Wednesday.

Then you have all of the Federally appointed employees in Washington. If the Republicans lose the election tomorrow, they are all unemployed in 76 days. This tends to make you wonder if this will be like Saddam Hussein pulling out of Kuwaiti, lighting the oil wells on fire. Paul and Ben could leave nothing but scorched earth for the Democrats. Obama would get to be the next Herbert Hoover.

With a Republicans win, the people in power will try to stay the course and that won’t work either. The country is broke, there is no money left to spend.

Whoever gets elected gets a tax base that will probably decrease by 20-40 percent over the coming year. I don’t think Congress will accept the fact that revenues are down. They will continue to spend.

So if you think you are having fun now, just wait a year!

Copyright 2008 All rights reserved

17 comments:

Anonymous said...

Technically, President Bush already -is- the next Herbert Hoover. Whomever wins tomorrow has the opportunity to become the next FDR.

Or not.

Sackerson said...

My guess now is Dow 4,900 (adjusted for CPI) in a few year's time, probably achieved by inflation. My hope for Americans (including my brother) is that though a little sharp in his practice and airy in his rhetoric, Obama will use his undoubted smarts to make some beneficial fundamental change in the economy, over time.

Jim in San Marcos said...

Hi Anon 9:37

I think that the election of 1928 fits more with the election of 2008. Housing in both eras was collapsing and banking was not on firm grounds. The stock market was still OK and there were almost no food kitchens with long lines of unemployed. In the election of 1932 there was no argument that we were in a depression.

FDR was able to spend us out of the mess to a degree because the Federal government had very little debt.

If you look at my previous post, the green bubble got started by FDR. The social security tax was a way to tax the worker and raise government revenues immediately. Very little in benefits had to be paid out. It was like GM signing the retirement plan in 1970. It would be 30 years before they had to really pay anything and now it is bankrupting them.

There is nothing written in fact here, just two differing opinions.

Jim in San Marcos said...

Hi Sack

Thanks for dropping by.

I think that the DOW will go a lot lower. The market will find a bottom when no one wants to be in stocks.

There have been losses, but there is still a lot of hope that it will get better. I think you can see that hope and frustration with the present market in some of the posts to this blog. We are still in the denial stage.

I would argue that politics got us into this mess, and if you want to keep your job in Congress, doing the right thing won't get you re elected.

Tomorrow could be an interesting day for the markets. Asia will be the first to "VOTE." Hold on!

Jim in San Marcos said...

The last post was deleted for being political in nature.

I try to be be politically neutral.

This blog doesn't support either candidate.

Anonymous said...

The question that I have is;
Why do people continue to vote for politicans who knowingly ABROGATE our Constitution.....
Each and every time, they raise their right hand to take the oath of office and swear to uphold the Constitution..Simply, stated ....They are lying......
The most recent $700 Billion bail-out, is a good case in point....
The Constitution ""specifically"" states that they cannot take money from the public, and distribute it to private entities....
Yah!!! Right!!! They are buying stock, in a bankrupt company....
Just to save it!!!!
I haven't vote in 40 years, and you can't blame me for voting for the idiots who got us into this mess, and voting for them to get you out of it is just plain STUPIDITY......
Come to think of it...Somebody once said...""IF"" stupidity got us into this mess, why can't stupidity get us out????

Shankar said...

4,900 in a year for Dow is too optimistic.

Realistic figure is around 3,000.

Pessimists may say its around 1,600.

Either case, it'll be somewhere between 1,600-3,000.

Ben G said...

Shankar,

That seems too low to me. I am thinking more a bottom of 5-7000, really.

Sackerson said...

I'm inclined to agree with Ben G. I'm merely extrapolating from the past 80 years. And I think it will be quite a while before that c. 5,000 bottom is reached - we're already getting a "hope surge" following Obama's landslide victory. I also suspect it won't be anywhere near 5,000 in points terms - if the Dow/S&P simply stagnate and you get 10% p.a. inflation for the next 7 years, you get the same result in real-wealth terms.

Anonymous said...

well, what I have found to be true in voting in the last 28 years is that the guy I voted for if he won never did as good a job as I expected and disappointed me and the guy I didn't vote for if he won never did as badly as I had expected.
I still am keeping my money secure- the media is acting as though the market is now back, but something doesn't feel right... I do think we have further to fall. I just would like to get my money out of my 401k now, but unfortunately, I have 9 years left. I am afraid this money even if in secure government funds
could vanish.

catholic girl

Shankar said...

Ben_G:

You could see a long-term (100+ Year) Dow Jones Chart to figure out the trend.

I can email to you if needed. Or perhaps to Jim.

Sackerson - Same goes for you.

Jim in San Marcos said...

Hi Catholic Girl

I agree most presidents turn out OK. Clinton was kind of an embarrassment. I found it rather awkward to explain to my 10 year old son what was going on at the time.

I am amazed that the voters seem to think that a new President washes away all of the sins of the last administration.

The new president has his work cut out for him, I wish him well.

Jim in San Marcos said...

Hi Shankar

Thank you for the offer, I've got them both, the regular and logarithmic.

I posted both about a year ago. It does make one pause, to look at.

Take care

Ben G said...

Jim, could you relink it? I can't find it...

Jim in San Marcos said...

Hi Ben

Here is a link. I know the titles to my articles have something to be desired. It's hard to find things.

Stock Market Graphs

beebs said...

It seems to me that the big spending plans of politicians everywhere are going to be dashed to the floor.

Where are we going to get the money for free healthcare, for example?

We might as well be discussing plans to colonize Jupiter.

Jim in San Marcos said...

Hi Beeb

It's worse than you think. We will get the free health care, if Congress isn't put on the shuttle to Jupiter.

The young don't pay into health insurance, they don't need it. And if they do, its pure gravy for the insurance company. Presently if you have health insurance, there is no wait for service. Free health care increases the tax base with people who will have very little demand for health care services.

Under the government health care you run into what I have referred to in the past as the "Disneyland effect." Extremely long lines. When Disneyland first started out, the Roller Coaster (the Matterhorn) was 6 tickets and no long line. Now there is just an admission fee and a three hour wait.

Another thing to look at under the present system. The poor get free health care already --- they don't pay the bills and the government has to pay them.

So instead of the noble thought of "health care for everyone," government is going to nail the third not paying into the system with a health care tax.

This kind of makes a used car salesman look like a piker.