First tax hike for the upper income people - Bush is proposing a sweeping change in taxes for health-care insurance – effect on gold, stocks and bond
Peter Oberois
Jan. 22, 2007

The Americans believe health-care cost is the nation’s top economic concern. The escalating costs of insurance, lower quality of service in the middle of ample negligence are big issues.

The first tax hike is on its way for the wealthy. Bush is proposing a sweeping change in taxes for health-care insurance. What is the effect on stocks, gold and bonds.

Higher tax for the wealthy for health care related issues may not be a large factor. As a matter of the wealthy may get the freedom of choice they wanted.

Stocks will have little effect initially. But over a longer period of time is good for stocks if health care costs and quality of service can be controlled. Bond market will rally as it controls stealth inflation. It will be obviously bearish for gold and bullish for dollar.

First tax hike for the upper income people - Bush is proposing a sweeping change in taxes for health-care insurance – effect on gold, stocks and bond
Peter Oberois
But over a longer period of time is good for stocks if health care costs and quality of service can be controlled. Bond market will rally as it controls stealth inflation. It will be obviously bearish for gold and bullish for dollar.
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Richmond Fed. Manufacturing index will jump nicely from –6.0 to +3.0 – bullish for dollar, bearish for bonds and gold
Special Correspondent
The manufacturing is stabilizing and moving higher. Richmond Fed. Manufacturing index will jump nicely from –6.0 to +3.0. It will be real bullish for dollar and bearish for bonds and gold markets.
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Housing and manufacturing will continue to give encouraging signals this week but quantitative and analytic models send warning signals
Special Correspondent
While the data will show apparent soft landing of the economy, the quantitative and analytic models are sending warning signals. It is a sinister calm before the big storm.
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During deflation brokers are hurt most – the dooms day for real estate, stock, bond and futures brokers
Special Correspondent
Real estate, stock, bond and futures brokers will see some worst of their days during 2007-2012. People will demand zero commissions and the brokers may be wiped out. During deflation Internet based zero cost transaction will become popular.
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After oil crash, a fall in Gold prices below $550 an ounce will confirm nasty deflation in the world economies – effects on stocks
Special Correspondent
The oil and commodity crash of 2007 is significant. It is giving early signals of deflation. Commodity deflation always comes last. The wage deflation is already there.
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Restatement of corporate profits (GE), lay offs (Motorola), lower guidance (Intel, IBM) and lack of pricing power are all signs of deflation and lower future prices of stocks, gold and commodities
Special Correspondent
US regulators objected to the way General Electric is showing its profit. The epidemic is wide spread. The corruption and lack of appropriate governance is so wide spread among corporations, you must have the right CPA firm to make it in Wall Street.
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Inflation adjusted Dow never made a new high - Stock market counting time before starting the next leg down in continuation of the bear market that started in Year 2000
Special correspondent
The real bear market started in 2000. Not many will understand that till year 2012. If you adjust the Dow for inflation and plot the same, you will find that Dow did not make a new high.
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