Trump Economy Naysayers Lesson

Reading Instructions: 

• Put Down the iPhones
• Know a 10 Sec. News Sound Byte is not all the Facts
• Read actual Historical Facts on Record
• Learn how to discover the Real Facts for yourself 

Fully understand what President Trump is accomplishing by comparing today's real facts to historial facts from 1843 to 2018 - You be the Judge... Enjoy this article, a real US History lesson!

To Every Thing There Is a Season,                                               But Your Portfolio Shouldn’t Turn                                                   

By: Jason Zweig, Wall Street Journal

Sept. 21, 2018

Every year, as the end of summer approaches, monarch butterflies head for Mexico, birds migrate south for the winter, and financial pundits predict that the stock market is about to crash.

Is the longstanding popular belief that September and October are the worst months for stocks valid?     Yes and no—mostly no.

Yes, some of the worst days in Wall Street’s history have hit during September and October - But that’s no reason to panic.

• On Sept. 24, 1869, the original Black Friday, the price of gold collapsed roughly 20% and took the stock market down with it.

• On Sept. 18, 1873, the investment bank Jay Cooke & Co. suspended payments, setting off a series of bank failures that triggered one of the worst depressions in U.S. history.

•  On Oct. 16, 1907, a busted speculation in copper led to a run on some of New York’s biggest banks, sparking a panic that ended only when J.P. Morgan personally intervened—ultimately leading to the creation of the Federal Reserve.

• On Oct. 28, 1929, “Black Monday,” the Dow Jones Industrial Average lost 12.8% in the crash that set the stage for the Great Depression.

•  On Oct. 19, 1987, the Dow fell 22.6%, the worst daily loss in its history.

• On Sept. 15, 2008, Lehman Brothers failed, ushering in the darkest days of the global financial crisis.

Is this destiny, or just random variation?

According to William Schwert, a finance professor at the University of Rochester who studies the history of asset prices, September does have the lowest average return of any month. From 1834 (the earliest date for broad market data) through 2018, September is the only month whose average return is negative -- at minus 0.4%.

Why Do You Think They Call It 'Fall'? The U.S. stock market has, on average, earned its lowest monthly returns in September. That might be a predictable result of less sunlight and colder weather–or it might just be a random fluctuation. Average returns on U.S. stocks between 1946–2018 by month. Source: G. William Schwert, University of Rochester

But the differences across months have been small, so you shouldn’t read much into September’s relatively poor historical average return, cautions Prof. Schwert.

Over the long run, December has the best average monthly return, at nearly 1.4%, with January close behind at 1.2%. The variations “don’t have much economic significance,” says Prof. Schwert.

As for October, its returns are positive on average, at 0.4% since 1834. Since 2002, October is the third-best month, with an average 1.6% return -- even though the S&P 500 lost nearly a fifth of its value in October 2008.

So investors’ fear of September and October is based less on evidence and more on what psychologists call “availability”—the human tendency to judge how likely an event is by how easily we can recall vivid examples of it. The horrific losses of October 2008 are hard to forget. The milder gains of 7% in October 2015 and 11% in October 2011 are hard to remember.

Investors might be more prone to worry this time of year, though. Researchers have found in numerous independent studies that as summer fades into fall, people’s behavior does turn with the leaves. As the hours of daylight dwindle, brain chemistry can change, reshaping how much risk some people are willing to take.

In his 1903 book, “The ABC of Stock Speculation,” the financial chronicler Samuel Armstrong Nelson wrote: “Speculators are not disposed to trade as freely and confidently in wet and stormy weather as they are during the dry days when the sun is shining, and mankind cheerful and optimistic.” 

Investors trading options are more likely to expect losses in fall than in spring or winter. In the U.S., Canada and Australia, mutual-fund shareholders are all net sellers in their respective fall months, even though Australia’s autumn runs from March through May and it has a different tax year. 

Average returns on U.S. Treasuries appear to be higher in fall than in spring, suggesting that investors seek safety in the darker months. Stock analysts’ earnings forecasts are less optimistic in fall and winter than in spring and summer. 

Across more than 150 years of data, bidders at fine-art auctions paid more, on average, for paintings sold on longer, sunnier days than they did on shorter, darker days. Even players in the National Football League tend to be more aggressive in games played on hot days than on cool days. 

Of course, not all investing decisions are driven by psychology. Nowadays, people might tend to sell stocks in the fall in order to fund tuition payments coming due in September or to pay off credit-card debt they racked up on summer vacations. They might invest more in the first quarter of the year after pocketing year-end bonuses and tax refunds.

Still, “if bad news comes out in the fall, many investors may react more extremely than they might a few months later or earlier, when daylight is more plentiful,” says Lisa Kramer, a finance professor at the University of Toronto who has run several studies on how seasonal mood changes may affect financial behavior.

Although the stock market doesn’t always crash in the fall, you might well be more likely this time of year to treat smaller declines as harbingers of doom. Try, instead, to remember that the darkest months of the year often have the brightest returns.

Write to Jason Zweig at intelligentinvestor@wsj.com 

Obama's Bed & Breakfasts Create Jobs

Currently, in 2015, Obama by Presidential Executive Orders is feverishly granting clemency by commuting "non-violent" prisoner sentences to reduce the incarcerated inmate numbers. On July 13, 2015 it was the largest clemency grant since the 1960's. This is while alien arrests increased exponentially as lax federal laws allow more illegal aliens entry with residency. 

A story below was printed in 2014 by an uber-liberal newspaper, the Los Angeles Times, crying about the need to incarcerate an even larger population of Hispanics; whining about the lack of jail space due to growing illegal aliens, criminals and gang felons populations; wailing about the poor families who cannot easily get out to visit their family members; sniveling about the detainees complaining about their diet and facilities--they are hardly a privileged class or are they?

Typically these illegal aliens all chose to come to the United States to win their "Jackpot of Welfare Gold for Life." President Obama has bequeathed upon these multitudes of uneducated, untrained and unwanted refugees whose own countries don't even want or need them either--frankly, they are a zero asset drain that bankrupts economies worldwide--just look at Europe bearing the African continent's illegal hordes flooding into the European Union with no education or trades taxing their economies, customs and cultures-SAD.

Think hard about all those illegal U.S. aliens, putting aside the obvious humanitarian feelings, they contribute nothing now or in the immediate future or even in the next generation paying with any substantive economic monetary growth to offset their huge social services burdens with billions more in taxes taken away from educated, working American citizens.

To even compete in earnings within a capitalistic society they must read and speak fluent English to get educated or trained to be productive individuals--"No habla in inglés, no hay trabajo!"--Painfully, many of them can't even read what I just wrote in Spanish!

Southern California's largest immigrant detention center to expand

KATE LINTHICUM

July 8, 2014

Immigrant advocacy groups are protesting the expansion of Southern California's largest immigrant detention center, arguing the federal government should instead be directing resources to children seeking asylum.

The sprawling detention complex in the high desert town of Adelanto has the capacity to hold 1,300 men. The construction project underway will add 650 beds, including a women’s housing unit. 

LAPD stops honoring some federal immigration detention requests as the Immigration and Customs Enforcement officials say the expansion is necessary in order to meet demand for more bed space in the Los Angeles area. According to ICE spokeswoman Virgina Kice, the agency seeks whenever possible to house detainees near the area of their arrest. But opponents have raised questions about conditions at the Adelanto facility, saying detainees have reported receiving inadequate healthcare and poor quality food. The center's remote location 40 miles north of San Bernardino also makes it difficult for attorneys and families to visit, they say. 

Immigrant advocates have long opposed a federal quota that requires the government to pay for 34,000 beds in detention centers each night. They say the government should not be spending to expand its detention system for immigrants, especially as the country grapples with how to house a recent influx of asylum-seeking minors from Central America.

“Resources should go to help the children seeking asylum, not to grow private prisons,” said Luis Nolasco, a member of the Justice For Immigrants Coalition, which has been collecting donations for immigrant children who have recently arrived in the Inland Empire. It doesn't end at 18, those kids will grow up to be single parents as well and become entitlement Americans and vote for more Democrat destroying policies and candidates.

                                                                                                                                    

The Adelanto facility houses detainees in ICE custody who are waiting for a decision in their immigration cases or are waiting to be repatriated. Detainees wear prison-style jumpsuits and often stay there for months at a time.

The facility is run by GEO Group, a private company from Florida. GEO is contracted by the city of Adelanto, which signed an intergovernmental service agreement with ICE to house detainees. 

Officials in Adelanto support the expansion, which they say will help the town's struggling economy, which is grappling with an 18% unemployment rate. The city, which also faces a $2.6-million budget deficit, earns 75 cents each day from GEO for every detention bed filled, according to Adelanto City Manager Jim Hart. More beds mean more money for the town. “It takes an existing facility, expands it, and creates more jobs,” Hart said. “That’s a financial benefit for the city.”

Adelanto is home to several other corrections facilities, including a San Bernardino County jail and a state prison facility that is also run by GEO. The city of 31,000 residents recently proposed building a 3,280-bed jail that it hopes to lease to Los Angeles County, which would use it to house inmates when its own jails are full.

On Monday, several immigrant advocacy groups asked U.S. Rep. Judy Chu (D-Monterey Park) to tour the facility at Adelanto, where she spent three hours walking the grounds, sampling the food in the cafeteria and browsing the resources available in the center's law library.

Speaking to immigrant advocates protesting outside, Chu said she did not notice anything especially worrisome about the facility, although she said she spoke to one inmate who complained that detainees were not given enough to eat or enough time to work on their cases in the law library. 

Bail Out U.S. Debt with Your Retirement Funds?

With only two weeks left before the November 4, 2014 midterm elections, the Democrats have evoked a populist riff to bolster the votes to retain majority senate control. Any companies that seek legal ways to invest their previously taxed foreign earnings in the U.S. without penalities, the CEO is branded as a "corporate deserter" by Obama. So let's go after the big bad boogyman, the greedy bloodsucking huge corporate behemoths stealing the milk out of babies' bottles who are left to starve! 

Every year, there are news stories outlining how much multinational corporations are paying in taxes. Many of the more sensational stories lead people to believe that U.S. companies pay little or nothing in taxes on their foreign earnings.

Source: KPMG LLP, U.S. audit, tax and advisory services firm,

Some politicians suggest implementing a “minimum tax” on corporate foreign earnings to prevent tax avoidance. Unfortunately, legislation that would impose these types of taxes on multinational corporations is based on a misunderstanding of how U.S. international tax rules work.

In any discussion of U.S. corporate tax policy and tax reform, it is important to understand how and to what extent multinational firms’ foreign earnings are taxed. Let's look at official U.S. IRS Tax Tables Key Findings: 

• The United States’ worldwide system of corporate taxation requires multinational corporations to pay taxes twice, first to the foreign country in which they do business and then to the IRS after they repatriate their profits.

• Petroleum and coal products manufacturing corporations paid $42.7 billion in foreign taxes on $118.2 billion in taxable income. Remarkably, this industry accounted for a quarter of all foreign earned income and 33 percent of all foreign taxes paid by U.S. multinationals. The average effective tax rate paid by petroleum and coal products manufacturers was 36.1 percent.

• While there are undoubtedly U.S. multinationals that paid low effective rates on their foreign earned income in some countries, a majority of foreign taxable income reported by U.S. corporations was taxed at effective rates between 20 and 30 percent overseas.

Source: IRS Form 1118 (2010).

Note: Includes only repatriated income and income subject to current taxation. Does not include income currently held abroad.

Conclusions

While it is undoubtedly true that U.S. multinational firms use numerous tax planning techniques to minimize the taxes, they pay on their foreign earnings.

IRS data shows that the subsidiaries of U.S. multinationals reported paying more than $128 billion in corporate income taxes to foreign tax authorities on roughly $470 billion in foreign taxable income in 2010.

"Averaged across some ninety countries, U.S. companies paid an effective tax rate of 27.2 percent on that income. While many corporations paid less than that on foreign earned income, a majority of foreign income in 2010 faced effective tax rates of 20 percent or higher in foreign countries. Furthermore, most corporate income was earned, and most corporate income taxes paid overseas were paid, by manufacturers, especially those engaged in petroleum and coal products manufacturing."

NOTE: Reporters and lawmakers who criticize U.S. companies for “avoiding” taxes on their foreign earnings need to be more careful with their language and acknowledge that our U.S. worldwide tax system requires U.S. firms to pay taxes twice on their foreign profits:  

First time to the host country

Second time to the U.S. IRS

A major point is that before U.S. companies can retain earnings to reinvest their profits back home that they pay the applicable foreign country's taxes. Then, the residual income can be repatriated to the shareholders' dividends for income distribution; company operating expenses for payroll. R&D or inventory; and cash reserves.

Have you ever asked yourself what 401K programs, Union profit sharing programs and company retirement programs are about? Hint: It's to grow tax-free investment monies to pay out for your future program benefits; it's not to reduce overall principle earnings power by paying extra income taxes to support government waste or for more debt bailouts. When you withdraw future benefits as income, the IRS then taxes you.

Any discussion about reforming the U.S. corporate tax code must keep these facts in mind. 

California, Here it Comes...Down As It is Done!

I can really empathize about state government regulatory burdens on Californians after living there for over fifty-six years and have since moved to Dallas, Texas. I cannot, however, sympathise with the state residents resolve to keep spending beyond their means. I recently read an Editorial in the Wall Street Journal written by Dr. Bradley Allen who is currently running for Congress in California's 24th District in the Republican race. He had lamented, "We Californians could learn how to grow from the Lone Star State." It called out a list of successes for his former home state of Texas [Houston] while then offering a whole litany of reasons for their failure in California.

The California vs. Texas comparison that Dr. Allen pointed to were: 

• Energy Industry - no fracking and horizontal drilling in gas and oil fields.

• State Business Income Tax - high at 4.1% (av. CA state rate)

• Utility Costs - electricity 50% to 88% higher for renewable-energy mandate.  

• Gasoline - 70 to 80 cents per gallon more due to CA state blending fuel laws.

• Job Growth - Los Angeles added 1 Mil people (1980-2010) & lost 165K jobs.

• Poor People - 42%+ in CA than TX. 17.6% L.A. poverty rate nation's highest.

• Regulatory laws - so overly burdensome they had driven business out of state.

What's truly remarkable about this editorial was it thoroughly covered the glaring differences with solid indisputable facts. It further argued quite forcefully for pro-growth policies that would spur on the California economy. I was absolutely sold on his editorial analysis until I read the last paragraph. It succinctly encapsulated in just a few sentences why California will remain moribund in its own excrement, not capable to escape its inevitable demise:

Dr. Allen stated besides the cited state parallels, he complained about job creation killers like Obamacare which must be addressed; or with respect to the onerous business Federal income tax of 35% with equally high small business S-Corp income tax, they restrict business expansion and affect job growth. He further complained about Federal regulations and energy costs too. His recommendation was, "Washington should follow Texas' lead and pass pro-growth reforms."..."It's not big verses small government. It's government that works for us not against us." [No Bradley, you are wrong. Take off your 'rose-colored' California glasses. It really is BIG government spending that does works against us.] 

The typical 'California dreaming' syndrome promotes government largess as the answer to all social problems and civil matters. If the undocumented illegal aliens need welfare or legal services the state provides them. If special interests need funding for projects the state provides them. If the state needs more monies to meet these budgetary demands the state floats new tax bonds or just passes tax increases.

The 2013 overall California state budget deficit has ballooned to $778 Billion plus unfunded state pension funds for $200 Billion. That's almost a Trillion dollars. Is this state looking at a 'too big to fail' Federal bailout? It's a possibility for a bankruptcy filing with a Washington style bailout as the California legislature's spending spree on the backs of state taxpayers is painfully coming down to a bitter showdown for a default and bond credit rating downgrade to junk.

Why do other states have to suffer to 'Bail Out' California for their free-spending programs?  Let them Go Bankrupt!

A Daydream & Nightmare - Obama Horror Story

This Column really hits home with its facts, interviews and insight into Obama's Presidency as it comes to a close. Why wasn't this written up at the beginning? Easy, because Peggy Noonan in her wildest dreams could never have imagined such a quixotic fool's paradise run in the U.S. Presidential Office!

The Daydream and the Nightmare

Obama isn't doing his job. He's waiting for history to recognize his greatness.

By

Peggy Noonan

Wall Street Journal

 

July 4, 2014 5:37 p.m. ET

I don't know if we sufficiently understand how weird and strange, how historically unparalleled, this presidency has become. We've got a sitting president who was just judged in a major poll to be the worst since World War II. The worst president in 70 years! Quinnipiac University's respondents also said, by 54% to 44%, that the Obama administration is not competent to run the government. A Zogby Analytics survey asked if respondents are proud or ashamed of the president. Those under 50 were proud, while those over 50, who have of course the longest experienced sense of American history, were ashamed.

We all know the reasons behind the numbers. The scandals that suggest poor stewardship and, in the case of the IRS, destructive political mischief. The president's signature legislation, which popularly bears his name and contains within it the heart of his political meaning, continues to wreak havoc in marketplaces and to be unpopular with the public. He is incapable of working with Congress, the worst at this crucial aspect of the job since Jimmy Carter, though Mr. Carter at least could work with the Mideast and produced the Camp David Accords. Mr. Obama has no regard for Republicans and doesn't like to be with Democrats. Internationally, small states that have traditionally been the locus of trouble (the Mideast) are producing more of it, while large states that have been more stable in their actions (Russia, China) are newly, starkly aggressive.

That's a long way of saying nothing's working.

Which I'm sure you've noticed.

 

Martin Kozlowski

But I'm not sure people are noticing the sheer strangeness of how the president is responding to the lack of success around him. He once seemed a serious man. He wrote books, lectured on the Constitution. Now he seems unserious, frivolous, shallow. He hangs with celebrities, plays golf. His references to Congress are merely sarcastic: "So sue me." "They don't do anything except block me. And call me names. It can't be that much fun." 

In a truly stunning piece in early June, Politico's Carrie Budoff Brown and Jennifer Epstein interviewed many around the president and reported a general feeling that events have left him—well, changed. He is "taking fuller advantage of the perquisites of office," such as hosting "star-studded dinners that sometimes go on well pastmidnight." He travels, leaving the White House more in the first half of 2014 than any other time of his presidency except his re-election year. He enjoys talking to athletes and celebrities, not grubby politicians, even members of his own party. He is above it all.

On his state trip to Italy in the spring, he asked to spend time with "interesting Italians." They were wealthy, famous. The dinner went for four hours. The next morning his staff were briefing him for a "60 Minutes" interview about Ukraine and health care. "One aide paraphrased Obama's response: 'Just last night I was talking about life and art, big interesting things, and now we're back to the minuscule things on politics.' ''

Minuscule? Politics is his job.

When the crisis in Ukraine escalated in March, White House aides wondered if Mr. Obama should cancel a planned weekend golf getaway in Florida. He went. At the "lush Ocean Reef Club," he reportedly told his dinner companions: "I needed this. I needed the golf. I needed to laugh. I needed to spend time with friends."

You get the impression his needs are pretty important in his hierarchy of concerns.

***

This is a president with 2½ years to go who shows every sign of running out the clock. Normally in a game you run out the clock when you're winning. He's running it out when he's losing.

All this is weird, unprecedented. The president shows no sign—none—of being overwhelmingly concerned and anxious at his predicaments or challenges. Every president before him would have been. They'd be questioning what they're doing wrong, changing tack. They'd be ordering frantic aides to meet and come up with what to change, how to change it, how to find common ground not only with Congress but with the electorate.

Instead he seems disinterested, disengaged almost to the point of disembodied. He is fatalistic, passive, minimalist. He talks about hitting "singles" and "doubles" in foreign policy.

"The world seems to disappoint him," says the New Yorker's liberal and sympathetic editor, David Remnick.

What kind of illusions do you have to have about the world to be disappointed when it, and its players, act aggressively or foolishly? Presidents aren't supposed to have those illusions, and they're not supposed to check out psychologically when their illusions are shattered.

***

Barack Obama doesn't seem to care about his unpopularity, or the decisions he's made that have not turned out well. He doesn't seem concerned. A guess at the reason: He thinks he is right about his essential policies. He is steering the world toward not relying on America. He is steering America toward greater dependence on and allegiance to government. He is creating a more federally controlled, Washington-centric nation that is run and organized by progressives. He thinks he's done his work, set America on a leftward course, and though his poll numbers are down now, history will look back on him and see him as heroic, realistic, using his phone and pen each day in spite of unprecedented resistance. He is Lincoln, scorned in his time but loved by history.

He thinks he is in line with the arc of history, that America, for all its stops and starts, for all the recent Supreme Court rulings, has embarked in the long term on governmental and cultural progressivism. Thus in time history will have the wisdom to look back and see him for what he really was: the great one who took every sling and arrow, who endured rising unpopularity, the first black president and the only one made to suffer like this.

That's what he's doing by running out the clock: He's waiting for history to get its act together and see his true size.

He's like someone who's constantly running the movie "Lincoln" in his head. It made a great impression on him, that movie. He told Time magazine, and Mr. Remnick, how much it struck him. President Lincoln of course had been badly abused in his time. Now his greatness is universally acknowledged. But if Mr. Obama read more of Lincoln, he might notice Lincoln's modesty, his plain ways, his willingness every day to work and negotiate with all who opposed him, from radical abolitionists who thought him too slow to supporters of a negotiated peace who thought him too martial. Lincoln showed respect for others. Those who loved him and worked for him thought he showed too much. He was witty and comical but not frivolous and never shallow. He didn't say, "So sue me." He never gave up trying to reach agreement and resolution.

It is weird to have a president who has given up. So many young journalists diligently covering this White House, especially those for whom it is their first, think what they're seeing is normal.

It is not. It is unprecedented and deeply strange. And, because the world is watching and calculating, unbelievably dangerous.