Tuesday, March 3, 2009

If Obama announced tomorrow that he was cutting the corporate tax rate from 35% to 15%, and lowering each individual tax bracket by 5%, it is very likely the market would jump at least 2,000 points within a week. Tax cuts mean more jobs and more money to purchase goods and services, all of which serve as the primary engine of our economy. Americans will not spend if they are not confident, and spending will only occur when America has jobs and money. An emotional rollercoaster fueled by emotion carrying stocks are not about to crash, but more dips and spikes are sure to arise unexpected.
With Obama in office, the media promises a turnaround in our country. However, why have stocks plummeted? The reason is a conflict in support for our new president. Investors are currently dumbfounded by the allocation of stimulus money. Money to AIG vanishes in weeks, and the government continues to give more. With all this assistance in the form of money comes inflation, and inflation will kill stocks and America. Whether you agree with Obama's budgeting for stimuls packages and bailouts or not, it is still not too late for you to invest in gold. Choose a gold stock that is directly related to it's actual price like the ticker GLD. Also an excellent buy is AEM which is a well managed mining company is a steal for investors looking to see profits in 6-8 months. It's target price is $56, almost $10 over what has been trading for over the past few days. Wrap yourself up with sturdy blanket made of gold to cover your losses.