Empower Network

Stock market analytics are as follows. Asia and European stocks are up Monday due to an improving outlook that the US will get their fiscal house in order. While many Americans, and the rest of the world, might look at unemployment rates of up to 25%, a poor economy or violent protests in Europe and think that “it’s not going to happen here”, they could be sorely mistaken. While the United States has some distinct advantages over Europe, such as the ability to print dollars and just one government to bring to agreement rather than many, it is unlikely that the U.S. economy can avoid the pain that European-style austerity could bring.

Many Americans have been led to believe during the course of the campaign that by simply raising taxes on the wealthy, our debt issues will be put on the right track or even solved: But this is false. The Simpson-Bowles Debt Commission has looked at the possible solutions and it is clear that only $80 to $90 billion will be raised on an annual basis by raising taxes on the rich. That barely puts a dent in the deficit that is running about $1 trillion per year and a total U.S. debt level of nearly $16 trillion. I believe the average American has been misled by politicians in both parties about the gravity of the U.S. debt load and the level of spending cuts that will be necessary to make the country fiscally sound. It’s not just the rich who will pay more in taxes in the future, but the middle class as well. And this will cause a slow down if not an out right recession, which will lead to much lower stock prices.  Only after the US  Government more closely matches expenditures with revenues, can there be a return to prosperity.  And there will be a lot of pain before there can be any vision of greener pastures.

Stocks to watch: Sales Force Dot Com, (CRM), releases earnings after the bell on Tuesday (23:00 Kiev time).  Look for this stock to be extremely volatile and heavily traded today and tomorrow.

Apple is trading up $7 to $535 in Frankfurt.  Many think Apple put in a bottom and Friday and is poised to rally now, but probably not to record levels as we saw in September.  Apple traded down to $505 mid-day Friday. Certainly a retest of this could be seen on any new major bad news not currently baked into the market.