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January 29, 2015

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ONE MORE SLAM to tax payers. Let's limit the contributions to the 401k plans. The way the President seems to see life is that anyone who works and pays taxes is a target to have their retirement and educational benefits taxed. He seems to believe that these instruments designed to inspire people to save for college and retirement expenses are a loophole for the benefit of the wealthy. And, of course, they do not provide a tax benefit to those who do not pay taxes. Therefore as he continues to increase the base of people who go untaxed by the Feds the benefit appears to fall more to the tax payers. And, so he prefers it if the government simply pays for everything from food to shelter to daycare to school to college. All at the expense of not the wealthy but at the expense of all tax payers. If his policies are not clear yet they soon will be as every day he brings forth another of his "snake swallowing it's tail" ideas to level the playing field. His view of the world seems to be that we all retire to the welfare system living in government assistance programs and on social security. I suppose that is a vision of a level playing field. Not a vision of equal opportunity just survive.

JOBs,JOBs,JOBs. Jack Welch, this morning on CNBC, discussed the impact of these falling oil prices on the employment market. If you recall a few months ago I commented "be careful what you wish for". Jack says that in this recent so called surge in employment most of the new jobs were in Texas as employment rose 13% there. Mostly due to the oil boom and it's impact on other industries. If you look at employment rather than unemployment then in this rally employment in Texas increased 13% while the combination of all the other states actually had negative employment growth. It's the old glass half full, glass half empty political view of the world. This link explains it pretty well: http://bit.ly/1DvLy4L (you may have to copy and paste this into your browser.)

Think of the impact of oil revenue loss on state and local taxes. Think of the loss of oil employment growth on the real estate market--taking yet another shot. Think of the lack of capital investment on the banks. It will be tough for lower gas prices to inspire the consumer to carry the load put on the economy by the oil losses and the impact of the strong dollar.

Republicans MUST stay focused on JOBS, the economy and Foreign policy and stay away from being dragged into immigration and social issue arguments of wealth distribution. IT IS THE POLICIES of the Fed and this President that has created a wealth enhancement economy driven by money printing while taxing those who pay taxes and work.

PUTIN rumbles on in the Ukraine. Separatists continue to make gains and now political stability is in question. The US seems unwilling to spend the dollars necessary to give Ukraine a stable economic base to fight from or the weapons they need to counter the Russian tanks and arms. It is amazing how the White House manages to keep ISIS and Ukraine and Syria out of the news. Things are not going well in Yemen either. But, you would think all is well with the President.

TWO CLEAR POINTS emerge every time we go through the President versus Republican show downs:
1. There is no hiding the President's agenda to further tax the people who pay income taxes and award more and more support to the people who don't. His budget speech today was another blatant admission of it. Despite his attempt to hide it in the bone thrown to the Defense Department and his continuous reference to his focus on the welfare of the Middle Class.

2. The Republicans always do something stupid that puts them in the position to be the bad guys. Using the budget for Homeland Defense as their attempt to leverage the President to the table on immigration is idiotic 2 years before a Presidential election. Republicans do not seem to be able to simply stand for what they should be: stewards of the economy. It's the economy stupid. Job's are the only thing that will help the Middle Class and lift up the lower income people of America. And, Republicans need to focus on the anemic recovery in job's, housing and household income.

It is ridiculous that Republicans always allow the Democrats to paint them as the defenders of the rich. Who really cares if we over tax the people who make Millions of dollars? Most of them are DEMOCRATS anyway. What we want is lower taxes for US small businesses and corporations and a better tax rate for families who earn $50,000 to $900,000 so that the nation's working population can progress up the ladder and have incentive to take risks and build new companies. If they want to tax Clint Eastwood and John Kerry at 50% call their bluff and let's see if Warren Buffet, Oprah, Tom Hanks and Bon Jovi pay their bills.

Call the President's bluff: Send him a bill to sign that allows overseas money to come back at a rate of 2% below his proposed rate but make the bill permanent not a one time windfall. See if he veto's it or sign's it. That's a win, win. Apple files another bond offering today --likely to get American money to buy back more stock until they can get their overseas cash over here.

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