Perhaps nailing down my economic philosophy while trying to consider actual market machination helped put me on the right track to profitability. The scars I earned trying to short NFLX, BIDU, GMCR, STI, RCL and kin finally caused me to realize that fundamentals never matter in a 5 day window. Excepting, of course, known catalysts like HLF being convicted in Europe for running a pyramid scheme. Were that well known news to be questioned in an American court the stock would rightfully drop 20% in minutes. More recently, this HPQ scandal was well telegraphed as Chanos has been nothing if not vocal about the accounting issues at Autonomy. Importantly, across a basket of stocks like the Russell or S&P, no news will materially affect stocks in a way that can't be undone, if trading is withheld until extreme conditions are reached.
Our markets have endured crashes, black days, the flash crash, and Sandy -- they are still open and humans still trade them. These market events gave off warning signs like chipmunks scurrying around before a storm. No matter how impersonal computers are, they are still operated by people, and those people leave footprints. As long as the market data is true, and the fundamentals don't matter on a weekly time frame one can justify technical analysis and quantitative trading strategies.
Further, I agree that there is an ever present tail risk that a syndicate of individuals or, more likely, a sovereign would seek to crash the markets. Afterall, PIMCO is worth $1.7T AUM and the whole S&P is only worth $13T. I feel that we are in a place that should such an occurrence take place middle America will wholesale abandon The Street. The Occupy movement started as a pack of hippies sitting in a park. If the markets dive in an uncontrolled manner too many Americans will become mattress-stuffers, and everything that Bernake has done will be for nothing. I believe the Obama victory can be principally attributed to a wave of libertarian (not TeaParty Republican) sentiment in America's middle as evidenced by the marijuana reform movement, and the middle's vote against partisan conservatism. Libertarians are ready to be less effected by the government and "The Economy." They are deploying their money locally and that favorably affects the structure of our real economy. Where Europe is fully developed, America has room for advancement. Where they are fully indoctrinated in socialism, we still have Animal Spirits.
Since Financialism is the United States' principal economic output, a second crash event like the follow-on to the Great Depression's initial dip would have severe and lasting implications. At such a point America would be exposed to threat of international imperialistic motives as we no longer produce enough of our own goods to readily sustain society. There is a risk, I accept it. I do not think the global elite would allow such a thing to happen as a sheep can only be slaughtered once. Global civil war suits noone. Even if we look at the Roman Civilization as an analogue for the United States, we have not over extended our boundaries, or become too heavily reliant on mercenaries above self-defense. If one chose to look at the Japanese model, we have yet another 50 years before the population begins to meaningfully decline. Further, I believe that the markets are still anchoring to the relatively fresh memories of the banking crisis.
While the government's actions have been controversial, they have been decisive and of a shockingly large scope. They have committed to their end of the deal, and now it is the responsibility of the global elite to uphold their end. I believe they will do so.
Tuesday, November 27, 2012
Thank you for writing. I understand the strong views many Americans have about taxes, and I appreciate your perspective.
This is a make-or-break moment for the middle class and those trying to reach it. I will not stop fighting to build an economy that works for everyone—an economy supported by a tax code that reflects the enduring American values of hard work, fair play, and shared responsibility.
Since I took office, my Administration has implemented numerous tax cuts for individuals, families, and businesses. The Recovery Act provided a tax cut to 95 percent of American workers, assisting 120 million families. In February, I signed the Middle Class Tax Relief and Job Creation Act, which extended the payroll tax cut, ensuring no working American will see their taxes go up this year. This extension prevents working families from losing an average of $40 per paycheck and enables them to keep about $1,000 of their hard-earned money in 2012. Further tax relief I enacted helps college students, seniors, and first-time homebuyers. And to uphold our commitments to service members, I signed the Returning Heroes and Wounded Warriors tax credits into law, rewarding companies that hire our Nation’s unemployed and disabled veterans.
I am ready to reform our tax code to eliminate decades of accumulated loopholes for the wealthiest taxpayers and biggest corporations, special interest carve-outs, and other tax expenditures that stack the deck against small business owners and ordinary families. For too long, our tax code has benefited the wealthy and well-connected at the expense of the majority of Americans. That is why I am committed to making our tax system fairer for the middle class and to ensuring everyone pays their fair share and plays by the same rules. I have urged Congress to enact the Buffett Rule, which would prevent millionaires and billionaires from using loopholes and special tax breaks to pay taxes at a lower rate than middle-class families. As we all come together to make shared sacrifices and crucial investments to grow our economy, we cannot afford to continue allowing some of the wealthiest Americans to avoid paying their fair share. To learn about our efforts to extend tax cuts for the middle class, please visit www.WhiteHouse.gov/Infographics/Extending-Middle-Class-Tax-Cuts.
Our current corporate tax system is outdated, unfair, and inefficient. It provides tax breaks for moving jobs overseas. It is unnecessarily complicated and forces America’s small businesses to spend countless hours and dollars filing their taxes. That is why my Administration released a framework for reform that simplifies the tax code, eliminates dozens of tax loopholes and subsidies, and promotes job creation right here at home. To increase competitiveness for companies across our Nation, our framework lowers the corporate tax rate, cuts tax rates further for manufacturers who are creating new products here in America, and includes a basic minimum tax for every multinational company—because no company should be able to avoid paying its fair share of taxes by moving jobs and profits out of the United States. I have also repeatedly called on Congress to stop giving away $4 billion a year in oil subsidies to an industry that has never been more profitable, and instead pass clean energy tax credits to cultivate a market for innovation in clean energy technology.
The American story is not about what we can do on our own; it is about what we can accomplish together. Our Nation’s success is possible only because previous generations sacrificed to make investments on our behalf. We must now join together in the same spirit of mutual responsibility to do what is right for our country’s future. To learn more about my tax reform plans, please visit www.WhiteHouse.gov/Economy/Reform/Tax-Reform.
Thank you, again, for writing.
Monday, November 12, 2012
Writing to The Administration is easier than ever, go to whitehouse.gov and click "contact us" in the upper right corner.
President Obama -Congratulations on your second term, I voted for you in this election.I did so not necessarily because I agree with your policies, but because I am one of an increasingly large contingent of libertarians stuck in the middle of the country that simply wish to be less affected by the government and "the economy." One needn't look any further than the marijuana reform movement to identify the real voting trend in this country, and it's practical, not progressive. Try to bear that in mind when negotiating this great Fiscal Cliff contrivance.How bush league was it for Paul Ryan to back off his pro-choice by individual liberty mandate in the middle of the election? Were it not for a partisan conservative (Romney headlining the ticket) you'd probably be cleaning out your desk this month. Paul Ryan is not a polarizing figure, though his tea-party backers certainly can be. If he had headlined, and thus remained principled, he would have won the middle. It is imperative that you not widen the chasm between producers and takers in the country by raising taxes solely in order to create a drop in the bucket toward our debt balance. Get a tax reform plan done in the next 4 years. It's all a marketing trick anyway. Figure out a way to make it simple, sustainable, and reasonable, then do it. For the individual, it doesn't need to be income focused, but tailored in a way that everyone should be participating in the country.Rather than let billionaires shake down the rest of the country with steep market index sell offs to garner fear and test the quality of our economy hold their tax sheltering accountable. They are, after all, the greatest beneficiaries of the swelling debt balance under your administration.
Charge Geithner and Bernake with getting a good measure of this offsetting debt written off both in the EU and at home.
Finally, a significant contributor to the decline of employment in America can be attributed to technological advancement rendering the human touch obsolete, however we cannot squelch the hunger instinct that drives human ingenuity. Please strongly consider the implications of a populace that, like Greece, Spain or Italy, relies on government transfers to support more than half of the country. Please stop giving entitlements to people that do nothing. THAT is the most painful specter to economically engaged individuals who have to drop their kids off at day care every morning. If we need to spend another trillion building a railway to the moon, do it, but make sure that it is human labor intensive.
Good luck to us all.