December’s Economic Crash

Richard Salbato - 6-21-2010

Everyone is looking to the November elections to save America, including me. Many are thinking of how the Republicans took over congress during Clinton’s presidency (Contract with America). It was the Republicans who balanced the budget although Clinton takes credit for it.

But I think of the November elections like the end of World War II, when we were going into a great second depression because hundreds of thousands of men were coming home from the war without jobs, factories that were building war ships, tanks, military trucks, jeeps, guns, bombs, etc. were now closing down. It seemed certain that we would have a 30% unemployment.

However, the people replaced an entire democratic congress with an overwhelming republican congress, which reduced taxes (war time) by 50% and cut government spending by the same amount. As a result we had the biggest expansion of inventions, factory expansion, and GDP in history. No real unemployment in spite of the massive change it took to change the factories.

If, as I suspect, Conservative Constitutionalists (CCs) take over congress in November, I do not expect the same good things right away. In fact, I expect a massive crash in the market in December, and two years of almost no recovery after that.

The reason is two things that are different. One is that we will have a lam-duck congress for almost two months. (The time between the elections and the inaugurations)

The second is that Obama does not have to have any approval from congress to raise taxes by 20% in January, because this is when the Bush tax cuts expire.

Now let us look at the present situation. By cutting back on payrolls and inventory, companies are making a great deal of profit now and are not investing it in future growth, which they do not expect. As a result businesses have 1.7 trillion in cash they are not reinvesting. In the non-business companies (by this I mean those who make money with money and not by making anything – banks and hedge funds) there is 140 trillion in cash on the side lines.

All these businesses know that their tax on profit will go up 20% in January so they are going to take out of their businesses all the profit they can in December (Capital Gains) and even reduce their business because they will save 20% in Capital Gains Tax. Because they will be afraid to hold cash profits after December, they might even cut their business more by laying off more people.

At the same time you will have congressmen and women who have lost their re-elections but will continue to serve in the house and senate for two more months. During this lam-duck congress they will pass everything they were afraid to pass because of the elections, Cap and Trade, Card-Check, Amnesty, Gun Control, and whatever else they can think of.

After December if Conservative Constitutionalists (CCs) take over, there is only one thing they can do for the next two years and that is to refuse to finance all these government programs and therefore reduce the debt, but they will not be able to reduce taxes.

Now regarding the non-productive businesses (the non banks), many of these might even leave the country because they can do what they do anywhere in the world and although I see no useful need for them at all, they can take 140 trillion dollars out of the country and to countries were they will pay less tax.

Now, one of the reasons I am making this warning, is that just like Obama and the left-media blames everything on Bush, even though democrats caused the 2008 crash, now they will blame the new congress on the second crash even before they are sworn into congress.

Once this happens, taxes to states will get worse and many cities, counties and even states will run out of cash and declare bankruptcy.

There is only one solution but it will never happen. Impeach Obama. I can think of 5 legitimate reasons to do this but it will not happen so I will not expand on it.

There is another possible salvation and that is if Obama sees the light like Clinton did, and becomes more conservative. However, Obama is so idealistically a socialist that he does not care what the American people think and in fact he hates America, the rule of law and the Constitution.

To prove this, just read the following:

1. Obama and the American Flag

Sunday morning "Meet The Press -2008.

Dale Lindsborg, Washington Post

General Bill Ginn' USAF (ret.) asked Obama to explain WHY he doesn't follow protocol when the National Anthem is played.

The General stated to Obama that according to the United States Code, Title 36, Chapter 10, Sec. 171...During rendition of the national anthem, when the flag is displayed, all present (except those in uniform) are expected to stand at attention facing the flag with the right hand over the heart. Or, at the very least, "Stand and Face it".

'Senator' Obama replied:

"As I've said about the flag pin, I don't want to be perceived as taking sides". "There are a lot of people in the world to whom the American flag is a symbol of oppression.." "The anthem itself conveys a war-like message. You know, the bombs bursting in air and all that sort of thing."

Obama continued: "The National Anthem should be 'swapped' for something less parochial and less bellicose. I like the song 'I'd Like To Teach the World To Sing'.  If that were our anthem, then, I might salute it.  In my opinion, we should consider reinventing our National Anthem as well as 'redesign' our Flag to better offer our enemies hope and love.

It's my intention, if elected, to disarm America to the level of acceptance to our Middle East Brethren.  If we, as a Nation of warring people, conduct ourselves like the nations of Islam, where peace prevails - - - perhaps a state or period of mutual accord could exist between our governments ."

When I become President, I will seek a pact of agreement to end hostilities between those who have been at war or in a state of enmity, and a freedom from disquieting oppressive thoughts. We as a Nation, have placed upon the nations of Islam, an unfair injustice which is WHY my wife disrespects the Flag and she and I have attended several flag burning ceremonies in the past".

"Of course now, I have found myself about to become the President of the United States and I have put my hatred aside. I will use my power to bring CHANGE to this Nation, and offer the people a new path.. My wife and I look forward to becoming our Country's First black Family.  Indeed,CHANGE is about to overwhelm the United States of America "

2. This year President Obama canceled the  21st annual National Day of Prayer ceremony at the White House under the ruse  Of "not wanting to offend anyone"

3. On September 25, 2009 from 4 am until 7  pm, a National Day of Prayer for the Muslim religion was Held on Capitol Hill,  Beside the White House. There were over 50,000 Muslims that  Day  in  D.C.