Change. That’s been candidate Obama, and now President Obama’s, rallying cry ever since he vaulted into the political limelight. Well, one thing you have to give the president credit for is his willingness to stick to his guns. You see, if “change” is what you voted for last November, you should consider yourself served, because that’s exactly what you’ve been given.
In the first eight months in office, the president has initiated the largest expansion of the federal government since World War II. He’s spent billions of dollars on corporate bailouts, and run up trillions of dollars in U.S. debt, ostensibly to fight the ravages of his “inherited” economic crisis.
In the first 100 days of his presidency, Mr. Obama signed a $787 billion stimulus bill into law and proposed an astonishing $3.6 trillion budget for the next fiscal year. Some political analysts have called these figures “unprecedented.” I prefer another term; dangerous!
Consider the dizzying array of acronyms describing some of the biggest, and in my view most pernicious, government programs. There’s TARP, (Troubled Asset Relief Program), TALF (Term Asset-Backed Securities Loan Facility) and the PPIP (Public-Private Investment Program). These mega-dollar programs don’t even include the $150 billion for funding green energy sources and $634 billion toward the introduction of universal healthcare.
So, is this too much spending, too fast? Well, I guess that depends on what side of the political aisle you sit.
If you’re a Democrat, you may think that the Obama agenda is a good thing. If you’re a Republican, you likely think the president is on the wrong track. But regardless of which side you come down on, there’s no denying the fact that the president’s plans will have a profound effect on the economy, the financial markets and your money for many years to come.
In my humble opinion, the policies and legislation being thrust upon us by the president and a sympathetic Congress are not conducive to the economy, and they will not fundamentally help right our economic ship.
In fact, I think that the unprecedented intrusion in economic affairs proposed by the president will likely do much more harm than good in the years ahead, and that is why you, the well-informed investor, must be prepared for the reverberations in the economy due to this administration’s actions.
But what, precisely, can you do to protect yourself—and to profit—from the decisions made in Washington, D.C.? Well, the first thing you can do is to read and follow the advice you get in the Alert.
You should also remember that no matter what Washington wants you to do, the beauty of being an American is that you don’t have to do it. In fact, your ability to zig when Washington zags is what makes this country so excellent. Of course, the trick is knowing just how and when to make those moves, and what tools are best suited to do the job.
But perhaps the first thing you should do is make sure you are a “survivor.” Surviving tough economic times with your capital intact is the first rule of successful money management. This is a lesson my father taught me more than three decades ago, and it’s a lesson I will be eternally grateful I learned.
You see, to be a winner in the investing game, you’ve got to have the money to sit at the table. If you lose a significant amount of your capital by trying to outsmart the market during tough times, you’ll wind up either broke or with not enough capital on hand to take advantage of the inevitable opportunities that follow the darkest of market downturns.
