Obama Promises Big Things: I say No Way

Kudlow asks his guests, "will we recover from this recession this year"? I, like his guests say, not until 2010. To be honest, I don't think with this recent stimulus package we will even see a recovery in 2010.

Let's review that stimulus package briefly: reduce tax deductions on housing; reduce tax deduction on charitable grants; raise tax on capital gains, which is still a double tax on dividends. Who is he stimulating exactly? The middle class into the poor house? You can no longer claim the entire house deductions you could before. You can no longer claim money you give to charity entirely as you could before. What does this mean? What does this say? Don't give to charity and don't buy houses.

We have Madoff coming to light. But I warn you now, Madoff isn't problematic, but symptomatic of what people not only have done, but can do in this market. People are now buying dummy corporations, running them into the ground and then claiming the insurance and bailout money. Also, the SEC has yet to have a proper response to the credit default swap fiasco.

And, we have the worst week in market history last week and this week isn't showing much light at the end of the tunnel. Already the DOW is down 25%. While the government wants to demonize shorters, stocks are steadily falling. Even Cramer, is pessimistic about the outlook. Today he had another screaming match on CNBC, but can you blame him?

Meanwhile on the precious metals, I have it on good authority that gold and silver in particular are being devalued. That's actually good news for potential investors right now. While everyone is laughing at Peter Schiff and calling him names for saying gold is going to go to $2,000 / oz, Jim Rogers is nodding his head as are some of the major players over seas. In fact, one such overseas investor went through the history of the DOW itself and pointed out how everyone was skeptical that the DOW would ever break one thousand. The rest is history of course, but he equates that to the price of gold. Everyone is skeptical that it would ever hit $2,000 but frankly with $7 trillion being introduced secretly into the economy via these awful bailouts, inflation is just a matter of time. In fact, hyperinflation isn\'t as far fetched as people like to also poke fun

at Peter Schiff for saying. We\'re seeing a rally on the dollar right now but honestly, we all know the dollar is manipulated more than a teen girl on prom night. There is no chance, nor hope that this rally is happening strictly due to market demand. And, we come full circle to gold. Now how far fetched is it, when I say gold is being manipulated. Gold should be $2,000 / oz if not $3,000 / oz. We don\'t even know the real value of the dollar. How can we scoff at $2,000/ oz gold?

Will there be an economic recovery this year? Review the facts for yourself. The market has no confidence in the administration right now. Obama promises big changes, but no one knows what they will be. The best thing he could do right now is step aside and let the market take care of itself. Stop these insane bailouts which leave the investor scratching his head as to how truly valuate stocks. Let these companies go into bankruptcy so someone smart can come in and properly valuate the company worth. Have the SEC throw the book at Moodies for not requiring full reserves while doing these credit default swaps, yet still evaluating their bonds at AAA rating. And, finally he should bring our troops home ASAP, which is why he and the Dems were put into office to begin with.

Unemployment came out today for a new high of 8.1% more than 650,000 lost last month alone: business -180,000; financials -44,000; retailers -39,500; hospitality -33,000. This is the highest it\'s been in a quarter century, since 1983. Right now they estimate 12.5 million Americans are out of work.

I guarantee if we pulled all the troops out of Iraq and Afghanistan, and the two other wars we are secretly fighting and paying for, we wouldn't be inthis economic slump to begin with. The military budget is some 60% of GDP, that is unconscionable. Without that spending, we could really reduce taxes and strengthen the dollar. And, no ... no terrorists were even involved in 9/11. You can debate me on that one in the next post.

I've said it, and Jim Rogers has said it too, take your money out of the bank, which isn't earning that much money these days [1%-2%] which are then taxed anyway, go buy a home safe and put your money in there. This will actually help the country. Leave only enough to pay bills with, in your bank account. Purchase real money items like gold and silver. Or treat 90 day t-bills as a bank account with a small return. Always remember to have a 6 month emergency fund, this is what should be in your home safe.

Kevin Cardinale of Boundless Enterprise

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