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How Politics Sways the Stock Market

By    |   Friday, 08 Apr 2011 10:00 AM

This week, two events happened that will shape the political debate during the next year. This article is by no way political in nature but will briefly provide a scorecard for those observing it.

Obviously the main topic of this week was Paul Ryan’s budget that he released on Tuesday. Clearly taking in $2 trillion and spending $3.5 trillion isn’t sustainable, especially when you already have $14 trillion in debt.

Many politicians used this issue to do what most politicians in both parties do best: Demonize their opponents without offering any solutions. In my opinion, failure to offer a real solution will lead to a change in the standard of living that the poorest Americans have presently.

Editor’s Note:
Warren Buffett's Obscure Strategy to ‘Retirement Prosperity’ — Click Here
 
Hopefully Ryan’s proposal will get the debate moving forward but being that President Barack Obama wants to increase — not decrease — spending, I’m not very optimistic.

Apparently many other Americans also aren’t very optimistic.

According to The Wall Street Journal, billionaire developer Donald Trump is showing signs of a surge in polls tracking GOP frontrunners for the 2012 presidential nomination.

In a recent Wall Street Journal/NBC poll, Trump was tied for second with former Arkansas Gov. Mike Huckabee, with 17 percent behind former Massachusetts Gov. Mitt Romney, who had 21 percent.

House Speaker Newt Gingrich got 11 percent, just ahead of former Republican Vice Presidential nominee Sarah Palin’s 10 percent.

As a professional investor whose job is to spot trends before they happen, I have been one of the first columnists to mention the Trump candidacy and how it should help the U.S stock market

The S&P has risen more than 10 percent since I first mentioned this in November.

Liberal and Conservative pundits continue to mock Trump’s candidacy and many folks who I respect have continued to dismiss him

However, my eclectic group of friends -- from ages 18-90 of all different interests and environments -- has one thing in common: They are results oriented people.

Many believe that politicians in both parties are only interested in gaining power and serving the needs of their contributors not their constituents.

As each day goes by, many are now realizing that like him or not, Trump is the only alternative to the status quo.

If nothing else, the increasing dialogue has begun to inspire those independents who voted for hope and change in the 2008 and 2010 elections.

Like it or not, Trump’s poll numbers and the S&P 500 stock index should be correlated over the next 18 months

Let’s hope for the sake of America that both rise.

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About the Author: Bill Spetrino
Bill Spetrino is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He is also the editor of the Dividend Machine. Discover more by Clicking Here Now.
 

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This week, two events happened that will shape the political debate during the next year. This article is by no way political in nature but will briefly provide a scorecard for those observing it. Obviously the main topic of this week was Paul Ryan s budget that he...
bill,spetrino,us,economy,Politics,Stock,Market
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2011-00-08
Friday, 08 Apr 2011 10:00 AM
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