Research for Online Investors
We are waiting on the Bernank to
testify before congress this morning. The market is up, ready to hang on
his every word for some hint of quantitative easing. Like all good
Pavlov’s dogs, we hope to be rewarded if we wait for our master to recognize our need!
Real world politics is winning out
over ideology. French President Francois Hollande followed through on
his campaign promises to raise taxes on the wealthy to pay for better pensions and a higher minimum wage that has
the effect of raising all wages including those of government workers.
Wealthy families are fleeing France
for neighboring countries with lower tax rates. French citizens will be
taxed at 75% on all earnings over $1.25 million. The previous highest
tax rate of 41% is set to increase to 45%. Sotheby’s Realty reports over
100 French estates sold with values over $2.1 million dollars since the election. Alexander Kraft, head of Sotheby’s France said “The result of the presidential
election has had a real impact on our sales.”
David Cameron, Prime Minister of
England, upset the French government last month when he said he would “roll out the red carpet” to wealthy French
citizens and businesses that moved to Britain to avoid high French taxes. Gilles Martin, a Swiss tax consultant, told the local newspaper “Since the
socialists came to power in France, I have been deluged with inquiries from rich French people who would rather pay
their tax in Switzerland.”
Hollande and his socialist party are
charging ahead with their plans to tax the country into submission.
The Telegraph has the story you can read for more details.
Spanish protesters marched through
Madrid yesterday, yelling “Hands up, this is robbery.” Was a criminal
act occurring? No. The protesters are angry over the latest round of pay
cuts under Spain’s latest fiscal emergency plan. Traditionally, Spanish
employers (and the government) paid employees a Christmas bonus of one additional month’s pay. Now the government bonus is gone.
This is a holdup!
Police, firemen, nurses are feeling
the pain of the latest austerity measures. Their wages were frozen in
2010 and now their bonus is curtailed. The government is also increasing
the Value Added Tax (VAT) from 18% to 21% Miguel Contreras is a nurse
and traveled to the capital for the protest. (Don’t ask how she afforded
it.) AFP reports her saying “It’s intolerable. The problems of the Spanish state don’t stem from civil servants…It’s unfair and
Spain’s two main unions have called
for more demonstrations on Thursday. Spain is set to receive up
to $125 billion to bailout their banks from the European Commission. Many Spaniards are angry the banks are being bailed out, while the government cuts
apply to the population. AFP has the story for further reading.
Secretary of State Hillary Clinton
was in Egypt this weekend. Crowds pelted her motorcade with tomatoes,
shoes and shouts of “Monica! Monica!” She met with the military to
encourage them to hand power over to civilians.
Newly elected Muslim Brotherhood
President Mohamed Morsi is trying to consolidate power. Last week he
called the parliament back into session to write a constitution. This
was after the Supreme Court ruled one-third of the legislators were illegal office holders and disbanded the body
until new elections could be held.
Field Marshal Mohamed Hussein
Tantawi, Egypt’s top military official, attended a military ceremony Sunday afternoon after meeting with
Clinton. He told the crowd “Egypt will not fall. It is for all Egyptians, not for a certain group---the armed forces will not allow
The New York Times reports Christian groups voiced suspicion of Clinton and the
U.S. Youssef Sidhom attended a meeting with Clinton. He said the ‘discomfort was rooted in the timing of American statements on
Egypt, which seemed to “bless democracy” just as Islamists were winning.”
This morning, a Cairo court was in
session to decide if the ‘reconstituted’ parliament could write a constitution. Members of the Muslim Brotherhood were in attendance and shouted “Down, down with
military rule.” They began pushing and elbowing lawyers that were
arguing the case before the court.
The presiding judge told the crowd
the court would not be intimidated, but suspended the session, then moved and reconvened in a different
The market fell into negative
territory on Fed Chairman Bernanke’s prepared remarks before he even started talking. Half way through the morning’s testimony we regained our footing and moved back to
the positive column for the day.
Republics are created by the virtue, public spirit, and intelligence of the citizens. They fall, when the wise are
banished from the public councils, because they dare to be honest, and the profligate are rewarded, because they
flatter the people, in order to betray them.---Justice Joseph
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