The Economy is Still Fundamentally Strong
Stocks are selling off yet again, but this is still a very good buying opportunity since the fundamentals of the economy are actually quite strong. Consumer spending is holding up very well inspite of rising gas, oil, food and and a fake recession and imaginary credit crisis. Also, personal income and worker productivity continues to rise. This is important because as long as consumers are able to put in longer hours at work and become more productive it will help offset economic weakness.
In addition, exports are rising, aided by a cheap dollar and booming globalist demand for commodities, machinery, technology services such as ipods, blackberries, and google click ads. Credit card spending is still shows no signs of slowing. Consumers will continue to max out their cards and incur more debt to maintain their standard of living. It is this propensity for spending, as well as increased productivity and rising wages which has helped stave off a textbook recession, versus the mental recession we’re in now.
Insourcing and outsurcing of labor has also helped bolster the economy. By laying off expensive American workers and cutting back on costly unncessasry expenses such as pensions, dental plans, and medical leave multinational companies can increase thier profit margins, which in turn helps the stock market. The insourced workers contriubte to the US economy by purchasing American goods such as ipods and computers, and food. In the end, cheap labor policies of insourcing, outsourcing, and elliminating unnecessary employee benefits helps everyone.
Keep in mind that unemployment and layoffs can be good for the economy because it helps expand the production possibility frontiers curve. Although the national unemployment numbers may seem dire if you listen the woe is me Obama campaign, the type of unemployment we are experiencing is frictional unemployment; unemployment that comes from people moving between jobs, careers, and locations. Laying off unskilled workers and outsourcing/insourcing increases the incentive for people to improve their skills and perform more productive work, which leads to new technologies and an expanded economy.
In an effort to keep labor cheap McCain has released bi lingual ads advocating guest worker programs. Has Obama done so? Nope because he is a protectionist who wants to see the economy suffer under a socialst agenda.
The best advice is to buy stocks such as GOOG AAPL MOS POT PCX EWZ V MA on the dips anbd ignore the pro-Obama recession crybabies who are spreading undue fear and protectionist propoganda.
Oil Surging, Futures Up Huge; McCain Rally is Real
I’m not going to get into the habit of updating the blog compulsively, but the US index futures are up around seven-tenth of a percent. That is AFTER the indexes surged 1.3 percent in regular trading. Oil is up a whopping three percent. This is the McCain rally in full affect.
Expect oil to hold steady around $95-105 until a few weeks before the election. Then it will rally when it becomes evident by traders that McCain will win, and an Iran invasion is priced in. The reason why oil will remain rangebound until a few weeks before the election is because surging oil and rising gas doesn’t make the McCain campaign looks good, and gives fodder for Obama’s socialist agenda. The smarties need to keep a lid on oil and gas till after the election. On November 4th after the electoral votes are tallied expect the contract to limit up.
The McCain weak dollar, globalist, free trade rally is real. Thats why the markets surged today and the futures are up. The financial crisis is self-limited becuase the US and global consumer purchasing power is still very robust. Short at your peril.
Um hum…McCain is Running an Honest Campaign
According to the pro-Obama, boo hoo hoo liberals the McCain campaign is resorting to diversionary, dishonest, underhanded campaign tactics to avoid the so called ‘important issues’ that face voters. Aww poor puppy. Cry me a river. The truth of the matter is all issues are fair game, including the ones the Obama campaign deems petty such as ‘lipstick on a pig’.
The lipstick comment was irrefutably a gaffe. Although Obama’s campaign spokespersons deny that he was referring to Palin, the remark does come at a time when Palin was dominating the news cycle following her monumental convention speech. A coincidence? Fat chance, which is why lipstickgate isn’t going away. Nor will it help Obama win over the much coveted, disaffected Hillary voters. After all it was Hillary who won the popular vote in the primaries and Puerto Rico, a feat that Obama wasn’t able to accomplish. By insulting Palin in such an egregious manner Obama proves that he lacks the temperament, civility, and composure to be commander in chief.
Speaking of quibbling, the liberals were making a huge stink over Bristol Palin’s pregnancy, but that issue went nowhere. The same for troopergate, which was a dud and the Palin’s husbands’ DUI. McCain’s polling numbers continue to rise, while Obama’s fall. Why did the pregnancy story fail to gain traction? Because it wasn’t a big deal. Teen pregnancy is perfectly acceptable to the republicans and evangelicals as long as the birth isn’t out of wedlock. It is the sex ed liberals invading the kindergartens that are advocating condoms and abortion as opposed to evangelicals who advocate sex for procreation, not recreation. Also, teenage pregnancy is good for the economy because early procreation results in more consumers, and hence more spendism, consumerism, and global growth.
A Google news search for “McCain lying” reveals over three thousand entries. But how is the McCain campaign lying? There isn’t a single shred of concrete evidence that McCain has lied about anything. How is saying that the economy is fundamentally strong, a lie when it indeed is? The imaginary financial crisis is an isolated event that only affects retail banks, mortgage companies, brokers, and investment banks. Non financial sectors such as materials, transports, energy, and technology are booming due to a cheap dollar and global growth. So it is actually Obama who is lying when he says the economy is weak.
Facebook, Myspace, Twitter, and Google are leading the web 2.0 internet boom in the Silicon Valley, but you won’t hear about that from the Obama campaign. Instead it’s the same liberal woe is me mindset. I lost my job. Iraq war going on too long. Too much national debt. I can’t afford healthcare…boo hoo hoo.
In conclusion, the Obama campaign is slandering McCain because their ads fail to stick, while McCain’s attack ads are like Velcro. Bittergate is still fresh in voters mind as is the Britney/Paris celebrity ad. Does anyone still remember Obama’s ads or speeches? Nope. Obama is bitter that his ads are easily forgotten or Palin’s pregnancy did go anywhere, so like a typical sore loser he accuses his opponent of playing unfair and being deceitful.
Imaginary Credit Crisis Rages On; McCain Rally to Resume
The imaginary credit crunch, housing bubble, and recession rages on with the Dow Jones Industrial Average falling over 500 points on the collapse of Lehman Brothers and AIG. The bearish sentiment is probably more overwhelming now than ever before with the major indexes making yearly lows. However historically such abrupt one-day selloffs have typically marked capitulation bottoms.
The chart above gives two examples where the markets sold off suddenly in one day, and then subsequently rebounded. The Dow lost over four percent in mid 2002 on the collapse of Worldcom, only to transition into a new bull market a few months later. And the markets staged a very strong rebound after being halted following the 911 terrorist attacks.
It bears (no pun intended) remembering that the only only recession we’re in is a fake, Obama generated one. We’re also in a fake housing bubble and a fake credit crunch/liquidity crisis. Contrary to the boo hoo hoo Obama democrats the US economy is very robust, there is no housing bubble, tons of credit, tons of consumer spending, and huge liquidity. Keep in mind there have been no negative GDP quarters since 2001.
But how is that possible that the credit crisis or housing bubble is merely an illusion? With the markets plunging so substancially surely there has to be some sort of weakness in the foundation of the US economy. But there isn’t. The United States and global economies are driven by consumption by retail consumers and industry, and that consumption has showed no sign of slowing.
The US consumer continues to max out their credit cards to buy food, gas, ipods, computers, and other goods. Durable orders (expensive items such as cars, TV, Computers) numbers have held up very well. As I have repeated numerous times if there were were a credit crunch and a liquidity crisis consumers woudn’t be able to max out their credit cards in order to keep spending, but they are. Millions of people still using the Facebook, the Google, and Myspace, as well as buying Ipods and Blackberrys. Americans continue to drive even with $4 gas and $100 oil.
The financial and consumer disgresionary sectors are ailing, but globalism and huge consumer and industry spending is helping other sectors such as technology, energy, and materials. China, India, Russia, and Brazil still need tons of coal and oil, and while commodities have sold off a lot in the past three months, they WILL rebound, especially on an ineviable McCain victory.
For the survival the US and global economy itis imperative that McCain wins because he will perpetuate the war in Iraq and invade Iran, further pushing the dollar lower and the national debt higher. A weak dollar and more debt will benefit globalist, smartist, new era companies that depend on exports such as Research in Motion, Apple, Google, Visa, Mastercard, Patriot Coal, and Potash Corp. McCain’s free trade policies will further bolster global growth for multinational corporations. We need more consumerism, globalism, spendism, paymentism, and free market capitalism under McCain, as opposed to protectionism and isolationism.
And Palin does have more experience than Obama and isn’t condescending to working, hard-working Americans, white Americans.
It is time to open the borders because American labor is too expensive. Insourcing (from Mexico) and outsourcing labor (to China and India) elliminates such unnecessary expenses such as healthcare, medical leave, and pensions. In the smartist era that we’re currently living in perks such as job security and nest eggs are a thing of the past and there is nothing Obama or McCain can do about it. It is beneficial for the US economy and the smarties of the new world order to widen the wealth gap and increase profit margins for multinational, industrial, and high tech corporations through cheap labor and less regulation, which is why McCain will win, and why Obama will lose. The jobs are moving overseas and will never come back. Need to vote in 2008 elections. Need a college degree to be an informed, tollerant, multicultural, global citizen.. Need to make more money, spend more money, and save less. We need to drill in Alaska and offshore.