Tags: Market | Corrupt Budget | Unrepentant Congress | stocks

Market Stressed From Corrupt Budget of Unrepentant Congress

Market Stressed From Corrupt Budget of Unrepentant Congress

Sunday, 20 December 2015 11:08 PM Current | Bio | Archive

You know there is something wrong when Congress passes a multi-trillion budget bill and tax extender spending package with “bi-partisan” support lacking the vote of any fiscal conservative.

Harry Reid, Nancy Pelosi, Mitch McConnell, and Paul Ryan were all smiles and holding hands while running a victory lap. This budget follows the trillion dollar transportation bill.

You would think that Congress would use their big stick—that is the control of spending—to deal with some the critical issues of the day that strike at the heart of our economy.

The United States financial markets are teetering on the edge of collapse.  Profit warnings come from an ever larger variety of sources signaling severe stock valuation problems. Retail sales are off.  Internet sales are growing, but not at any near enough a rate to offset the losses of retail sales by the brick and mortar stores.

The American economy is suffering from a lack of long-term capital investment and productivity. Unquestionably, commodity price weakness shows that manufacturing is well off. The labor participation rate is at a record low while welfare is at a record high. The financial system itself is dysfunctional.

The major Wall Street banks engage in every type of financial fraud and scam imaginable.  They pay some fines, but no officer or director goes to jail. Congress knows they are insolvent, but Wall Street is the biggest honeypot for campaign contributions.  As a result, Congress considers the banks are too big to fail. .

You would think that Congress would have focused on dealing with a lengthy laundry list of critical economic issues that involve government action and influence.  If you do, you would think wrong.

Yes, money is power, and the new budget involves trillion dollars in spending. So, what did Congress intend to accomplish by spending all this money? The primary goal is to pay for bi-partisan pork-barrel politics as usual. There were a couple of good spending items that were tossed in to cover for everything else.

Nearly all the spending is just to rev up Republican and Democrat campaign contributors and special interest voting blocks before the primaries and the general election.  That’s why these spending bills blow past November and go into 2017.

Is any of this beneficial for investors and the financial markets? No.  It's awful for the economy.

The deficit goes up by trillions of dollars just when interest rates on debt will go up.  Potentially, just the interest on the debt could exceed total tax revenues. Government bureaucracies and their ability to issue ever more intrusive regulations with no accountability will expand.

The Federal Reserve will continue to act as an instrument of political policy.  There will be no congressional oversight. Academic theorists with PhDs experiment with the real financial world to prove beyond doubt that their deeply believed economic theories don’t work.

Unquestionably, the investment markets are reflecting the tremendous stress generated by Congressional malfeasance and misfeasance.

Given time and pressure, even the strongest economy will crack.

Investors had better get their financial assets into some form that will provide protection from tax, inflation and maybe even creditors. Likely, many everyday investors looking at the medium and long-term investment horizon may well look to life insurance and annuity structures. In the meantime, Congress is politically unrepentant in passing another multi-trillion dollar corrupt budget.  

Denis Kleinfeld is known as a strategic tax and wealth protection lawyer, widely published author and creative teacher. To read more of his articles, CLICK HERE NOW.

© 2020 Newsmax Finance. All rights reserved.

1Like our page
You know there is something wrong when Congress passes multi- trillion budget bill and tax extender spending package with "bi-partisan" support lacking the vote of any fiscal conservative.
Market, Corrupt Budget, Unrepentant Congress, stocks
Sunday, 20 December 2015 11:08 PM
Newsmax Media, Inc.

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved