One Good Man
Research for Online Investors

12/23/11

The Senate approved lower Social Security contributions and extended unemployment benefits this morning by Unanimous Consent.  The House of Representatives followed shortly after with a nearly empty chamber.  All we needed was one good man.

Unanimous Consent means one person could have stopped this from passing by raising his hand.  Who could it be?  One person to say “No, we don’t have the money.  Social Security is already in an annual deficit.  We can’t afford to pay people to not work for over a year.  We cannot afford this.”  No one stood up.  No one muttered.  No one said a word.

We needed ONE GOOD MAN

The U.S. now has a national debt of over $15 trillion dollars and unfunded entitlements variously estimated at $60 trillion to $120 trillion.  That means we owe more than our total Gross Domestic Product for one year right now, and have promises of more than our annual production for the next four to eight years.

Even the progressives realize you can’t take it all in one year, so the population just has to be bled slowly.  Keep the patient alive, give them hope with a tax cut and carrot.  Make the government receipts more progressive.  We have spent our children’s total income for the rest of their lives…but by golly we are going to have a Merry Christmas.

It seems populism has won.  Politicians are going to hand out the goodies.  Someday the gnashing of teeth will be painful…but for now, party on!

Watch for news out of the Middle East this weekend.  Navy Commander Rear Admiral Habibollah Sayyari told a news conference the Iranian Navy will start a 10-day maneuver on Saturday in an area including the Strait of Hormuz.

The Tehran Times reports the “war games” will be spread over an area covering about 2,000 square miles.  Sayyari said the war games are to display the prowess of Iran’s armed forces and covey a message of “peace and friendship” to regional countries.

Iran will deploy warships, destroyers, drones and submarines.  When asked if the Iranian Navy would close the Strait of Hormuz, Sayyari replied “No decision has been made in this regard yet.”

The potential for an “accident” is present as the USS John C. Stennis Nimitz-class super carrier is deployed to the Gulf of Oman.  The Stennis is the flagship of the Carrier Strike Group Three (CSG-3) and the Destroyer Squadron 21 (DESCRON 21).  Carrier Strike Group Three is commanded by Rear Adm. Craig S. Faller

One Good Man, Rear Admiral Craig S. Faller,
 may he use all his wisdom in the next ten days.

The Iranian Navy has taunted U.S. ships before with “practice” offensive actions to test the ships defenses.

About 30% of the world’s seaborne crude passes through the Strait of Hormuz.  Makes you temped to buy a few options on the USO (U.S. Crude Oil ETF) doesn’t it?  Others already have.  The USO is trading at $38 and change.  Options have been purchased all the way up to the limit of $70, with expiration in four weeks!  $70 dollars on the USO would put West Texas Intermediate (WTI) crude at over $180 dollars per barrel.

Quote:
I hope this congress has had a very good learning experience…Legislation is the art of compromise.---Harry Reid

Editor's note:  Have a Merry Christmas!  The market will be closed on Monday.  We are going to refresh ourselves with with family and quiet time to reflect on what is important.  It most certainly is not most of the things we are concerned about everyday (eurozone debt problems).

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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