Now that Congress has made a deal that will stop the “fiscal cliff” there will be tax increases on the rich (which are presently defined as those individuals earning over $400,000 individuals, and $450,000 married filing jointly). And of course, there will be little or no spending cuts. But there will will still be a tax increase on EVERY working American because of the expiration of the reduction in social security taxes. So, what have we as a country accomplished? On a best case basis, the US will generate about $600 billion over ten years, or $60 billion a year, which will go nowhere in reducing a $1 trillion plus deficit. This entire exercise was really a waste of time. There appears to be no real hope that Washington will do the right thing, whatever that is.
Many of you have asked why arnold does not have all of those flattering comments about his mother-in-law anymore. The reason is that arnold made a promise (to a reader) that if he could not say anything nice about his mother-in-law, that he should say nothing. Consequently, arnold has said nothing.
Now, with the passage of the “fiscal cliff” legislation, Congress has 2 months to decide what if anything it will do about spending cuts. What are spending cuts? And then there is the debt ceiling which needs to be raised. There will be at least another several months of constant friction in Congress.
The DJIA should rise to nominal new highs or close to it before the end of the first quarter.
Gold should rise to $2000 plus or minus before mid April.
Oil should also rise to about $125 before summer.
The dollar has been falling from the tax deal in Congress but ultimately should rise.
Interest rates are still in a tight trading range.
Real estate pricing is still rising for the time being.
The economy clearly is not doing well. Christmas spending appears to have been flat or up slightly.
Disclaimer: (found at http://www.arnoldsramblings.com/homephp/testpage/).