A Brief Cynical Look at the Economic Condition After the Election

Remember remember the 5th of November...

Today I will focus on the immediate economic implications of the election.
To the surprise of many Obama supporters, and especially to the media which seemed to ignore the connection, the DOW closed 486.01 lower to rest at 9,139.27. Influenced almost entirely by the election, which is evidenced by the inactivity of the past couple days leading up to the election, the market lost an entire 5.05% of it's value.

Oddly enough, even many Eco-friendly businesses that would benefit from an Obama presidency in the form of subsidies took a dive in stock price:

Evergreen Solar, Inc. NYSE: ESLR 4.39 -.90(-17.01%)

SunPower Corporation NYSE: SPWRA 32.99 -17.51(-34.67%)

Solarfun Power Holdings Co., Ltd. (ADR) NYSE: SOLF 7.36 -1.59(-17.77%)

Based on simple economic principals, it would make sense that the market did not like Obama winning the election.

-Raising Taxes In general,harms the Economy.(As agreed on by at least 95% of Economists)

-Capital Gains Tax (It was shown during the Clinton Administration, when the capital gains tax was lowered, that the Capital gains tax has such an impact on how much people invest that when this tax is raised the government actually takes in LESS money. So in addition to harming the economy, the government takes in less in tax revenues: A lose, lose situation)

-Income Tax (Biggest Increments on the Highest Tax brackets)
-Dividend Tax
-Inheritance Tax (I hope you weren't hoping of leaving anything for your family)

Although some liberal media would like to tell you differently, Obama is in favor of the largest tax increases in history since the birth of the income tax. The capital gains tax, income tax, dividend tax, and the inheritance tax are all on his agenda for large hikes. In addition, he would like to propose a few taxes we never had before:
-Extra taxes on any home over 2400 Sq ft.
-New gasoline taxes (this will make gas more expensive)
-New taxes on other natural resource consumption (Heating, Electricity, ect.)
-New taxes on retirement accounts
-Social Medicare Taxes

Based on this, we can cynically conclude that the stock market is in for hard times.

No comments: