Offshore Drilling Ban
Research for Online Investors

by John Dalt

12/03/10

The Obama Administration backpedaled on plans for offshore oil drilling.  Yesterday, the Interior Department placed the Eastern half of the Gulf of Mexico off limits and all of the Eastern Coast for at least seven years.  This will give the bureaucrats time to write new regulations for safety.

It also means future elections can focus on cleaning house of those that would hold our economy and way of life hostage to environmentalists and other world improvers.

Time Online reports the announcement from Interior Secretary Ken Salazar.  He said, “"Energy policy is an area where the Administration and Congress can work together in a bipartisan fashion to support jobs and energy.  But we need a comprehensive approach that just can't be drilling.  If Congress wants to lift the moratorium on the eastern Gulf of Mexico the Administration will listen only if it is part of a balanced energy package...including renewables, electrification of vehicles and clean energy R & D."

The intention is clear.  The administration will not allow offshore drilling (except in the western part of the gulf) unless congress agrees to a cap and trade plan or some other ‘progressive’ environmental initiative.

According to an Opinion article in the Wall Street Journal, congress has to act on tax rates by next week, or tax tables will be sent out to employers with the higher rates that will take effect.  Computers will be programmed, and higher withholding will begin Jan. 1st.

H&R Block estimates that a married couple earning $80,000 per year will have an additional $221.48 taken out of their bi-monthly pay checks, starting in January.

The Alternative Minimum tax will catch as many as 27 million households, according to the Congressional Budget Office.  Everyone believes congress will pass a bill soon to extend the tax breaks.  If they take longer than the next 10 days, the “bus will leave the station.”  Even though the Republicans can retroactively pass a bill in January, the extra withholding will already be collected.  The money will be out of the economy until taxpayers get it back in a refund a year later.

Spain sold $3.24 billion dollars in three-year bonds yesterday.  Interest rates increased 1.2% over their last sale of similar bonds in October.  The bonds were sold at an average 3.717% interest rate.  The government cut the size of the offering because of the higher interest rates.  Spain plans on selling 10 and 15-year bonds on Dec. 16.

The Wall Street Journal reports that Finance Minister Elena Salgado said that the country would only sell $23 billion dollars in new debt next year.  Spain plans on selling $11.5 billion in other assets.

The bulls got a slap in the face this morning.  After two big days up in the market, Non-Farm payrolls showed the economy created 39,000 jobs last month.  Economists expected 145,000 which was still less than October. The unemployment rate climbed to 9.8% from 9.6%

The market is holding onto the hope that the Fed will ride to our rescue and pump more money into the economy.  Next year at this time, will we be talking about QE 3?

The mailbag:
The American people have been defrauded by their own government and just now being told that “it is OK ”-paid up subscriber R.A.

Boy, you find great quotes.---paid up subscriber K.V.

What did Thomas Jefferson mean “private banks” issuing currency?---paid up subscriber M.T.

John’s reply:  Remember, the constitution requires the congress “To coin money, regulate the Value thereof.”  Banks issued paper money that was backed by gold in their vault.  The Fed is an abomination; Congress abrogated their duty to the Fed.  The Fed is supplanting congress and setting the value of our money.

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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