Trump Is Right

Trump has been warning that there will be a stock market crash that will dwarf the 2008 financial crisis. Well, many experts agree with him.  Back in February the Congressional Budget Office and the Government Accountability Office told Congress that within the next decade we will have a severe financial crisis.  It was a matter of when.

The reason is the huge spending of the Obama Administration which has doubled the debt of the nation.  One of the principal factors is the enormous health care costs generated by ObamaCare.  Major insurance companies like United Health Care, Blue Cross-Blue Shield and Aetna have all reported losses.  They cannot cover the medical expenses of the people enrolled because the healthy young people have opted to pay the penalty rather than sign up.  This was predicted by the Republicans when the bill was passed without any consultation with Republicans. So many insurance companies have withdrawn from the plan that the Democrats are crying that what is needed is more government subsidies to make up the losses suffered by the insurance companies.  In the meantime, premiums and deductibles are so high that the Affordable Care Act has become the Unaffordable Care Act.

In October a number of prominent economists and investors have issued an independent warning for a stock market crash. Prophetic economist Andrew Smithers warned “U.S. stocks are now 80% overvalued.”

Trump has talked about this on the campaign trail. It is the “Wall Street bubble” that he has repeatedly told audiences about.

Lending considerable emphases to these predictions is James Dale Davidson.  Davidson predicted the 1999 and 2007 collapses. Davidson is telling investors to sell.  If people don’t sell he predicts there is going to be a 50% collapse in the market.

International financial institution experts from CrossBorders and Societe Generale have cited “Liquidity is drying up.” The cash flow which is important for corporate profits is diminishing at a rapid rate.  In short, corporations are caught between high taxes and low consumer spending. This is why so many corporations are leaving the United States. According to the US Department of Labor, we have more government jobs than manufacturing jobs.  The problem with that is that government doesn’t produce wealth.  It takes wealth in the form of taxes.

Whoever becomes president will face this crisis.  Trump wants to stimulate the economy by cutting taxes which worked under Coolidge, Kennedy, Reagan and Clinton (Newt Gingrich actually).  Trump wants to cut taxes also across the board and cut government spending which history has shown to work. Hillary wants to spend more money on social programs and raise taxes for things like “free college education.” Her financial policies will accelerate the Wall Street collapse and prolong the recovery.

Franklin Roosevelt back in the 1930’s promised to cut taxes every year he ran for the Presidency.  He never kept his promise.  Taxes and spending increased during his administration which drove the nation deeper into debt and prolonged the Depression. Hillary and the Democrats have not learned from history.  Their solution over decades has been to throw more money at the problems.    They provide proof that Einstein’s theory of insanity has roots in the Democratic Party.  Einstein said, “Insanity is doing something over and over again and expecting a different result.”

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About camden41

Retired public school administrator Retired history professor: Taught Western Civilization, American Civil War, United States History, Economic History, Ancient & Medieval Foundations, American History Since 1945
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