CSMS Magazine staff writer
I’m retired. And, as I look back at personal experiences, I have learned we either stay interested in growing our money or we become dependent on government handouts. I remember growing up on my parent’s farm, their only income was my father’s social security. My mother was told we qualified for government aid, five pounds of cheese. As a teenager, living in a subsistence environment, life looked good, I had no idea how people with money lived. Yet, my mother constantly hounded me, “Get an education, don’t end up like your father and me!”
The education paid off, and at a very early age we dropped out of the workforce. But, I will always remember the five pounds of cheese. It’s a motivator to stay in the investment game.
Your quality of life is dependent on YOUR financial success. If you are short on dollars and don’t have a financial plan, it is never too late to get in the game, taking charge of your future.
Each morning I start the day with Jim Cramer @CNBC.COM, US Videos. Cramer is an experienced stock trader and, unlike CSMS Magazine and myself, he is licensed to recommend individual companies. Many of his shows educate the first time investor, he can get you started. Today’s broadcast covered: the new high list, buy on pull back, trading around a core position, buy in increments, sell in increments, short positions/insider buying, keep some cash back. Cash can unwind a bad investment and allow you to breakeven or cut your loss.
Managing your cash requires you either lead, follow, or become extinct. We live in crazy times, emotions are running high, your neighbors are fearful of what tomorrow brings. But, for those who have their emotions under control, prior to investing, they must do their homework, their investment opportunities are limitless.
Take a moment and view the world through my eyes and remember you need not agree with everything I write. The ‘Global Economy’, what do those words mean? I think they convey special interest lobbied Congress with a fairytale story of open borders, competition, and low priced goods. We were told, our purchase of imports allowed foreigners to buy US exports and ultimately, so the yarn goes, improve the quality of life for everyone. If we operated in a capitalistic environment, without governments intervening, this fairytale might have legs.
Innovation and productivity allowed Americas’ workforce to enjoy years of wage growth. But, that was before the global economy. Employers now access a global labor market where compensation paid American workers exceeds the price of rival labor.
Next, factor in US employer taxes (property, income, retirement, health, utility, insurance, etc.). When deciding where to locate, businesses combined the price of labor and governments’ tax, the result, the US has become the second worst country to invest in.
If you are at the top of the food chain—and America was—other countries have always been envious to get what you take for granted. The global economy has turned into an economic war and countries that increase employer taxes run the risk of higher unemployment and a lower standard of living.
In a hail of Washington rhetoric, thirty million uninsured Americans obtained health insurance. We heard, “Only the rich pay for the uninsured.” I don’t agree. Taxes are included in product price and the end user ultimately pays the piper. It did my heart good to see so many young people embrace the President’s plan. He picked their pockets and burdened their future generations. He stood amongst them, he told jokes, and they applauded. Youth, to be young and naive!
The health care legislation resulted in an immediate one-billion dollar corporate prescription drug tax. The impact of this legislation remains unknown, the final details have yet to be written, and may not be fully understood for three years. Yet, where I grocery shop the price of staples immediately jumped.
Taxes increase the consumers’ cost and may force American employers to seek an alternate location. Factor in (wages, taxes, imports) and the result is higher unemployment. In the first quarter of 2010, five-million Americans filed first time unemployment claims. Continued unemployment claims were 4.65 million and those unemployed workers, receiving extended benefits, 5.7 million. No one has a clue as to the number of workers that exhausted their benefits and are still without work. But, one indicator is the number of family members that have been forced to cohabitate.
Americans are kept out of work by cheap imports. The question is: how do you change the playing field? How do American workers support US employers while altering an environment to embrace competition, employment, and investment growth? To me the options are obvious, eliminate/reduce the employer tax or cut wages.
Wage reduction ultimately results in a reduced standard of living. There is a cause and effect and not everyone is immediately impacted. But, there is a snowball effect, and as it rolls downhill, it consumes all but those who work for a monopoly.
I don’t own a business, but I favor lowering the corporate tax rate and reducing the scope of federal, state and municipal governments.
To grow your money you need economic growth. Economic growth requires business friendly governments (federal, state, and municipal). Governments do not create jobs and large governments steal investment dollars from the private sector.
Neither political party represents the American worker. Historically, voters reelect the same bureaucrats and rehash problems that should have been resolved years ago. This spring and fall workers return to the polls. Is this the year new faces spring forth fresh ideas?
Note: CSMS Magazine and the author are not in the business of providing financial services or advice. Prior to investing, readers must seek professional assistance.
Andrew Robbins is the author of: It Took My Breath Away; One Man’s Experience May Save Your Life. He may be reached by email at: firstname.lastname@example.org