http://albertpeia.com/2economicdevelopments.htm
‘Last week I outlined the
reason why we are very likely going over the fiscal cliff: there are little if
any political incentives for the GOP or Dems to fix the problem; the best
option politically is to let us go over the cliff and then offer targeted tax breaks
in late 2013 early 2014 as part of their 2014 Congressional campaigns.
With that in mind,
corporations are now rushing out special dividends to shareholders in an effort
to beat the coming tax hikes on dividends.
Between Nov. 1 and Dec. 5, 349
companies moved up their dividends or paid special dividends, according to
Silverblatt. That is higher than the 314 irregular dividends paid last
year in all of November and December. Silverblatt expects the pace of early
dividends to pick up if Washington keeps dawdling.
Many companies go beyond
moving up ordinary payments. They are declaring special, one-time dividends to
take advantage of the lower tax rate while it lasts.
http://www.lasvegassun.com/news/2012/dec/10/us-wall-street-week-ahead/
This is a serious red flag
for the US economy’s future: all of the capital being paid out to shareholders
will not be going into corporate expansions or hiring. This, when taken along
with the recent rush of capital into savings accounts ($150 billion was shifted
into savings accounts following Obama’s re-election), indicates that big money
is either going into hibernation or being paid out to shareholders.
In simple terms: none
of these funds will be used to grow the US economy or create jobs. Which means
the US economy will be taking an even sharper nose-dive than expected in 2013.
On the other side of the
pond, the EU as a whole is in recession. However, recent data coming from
Germany indicates things are going to be getting significantly worse.
Month over month, German
industrial production fell 2.6% in October. It fell 1.3% the month before. This
contraction has resulted in the Bundesbank lowering its 2013 GDP growth projection
to just 0.4%.
The entire EU bailout process
has been based on the notion that Germany will write the check to fund various
bailouts/ interventions. If Germany enters a recession then politically it will
be much harder for German politicians to push for additional aid to the rest of
the EU.
Remember, Chancellor Angela
Merkel is up for re-election next year. So she will be turning her attention
increasingly towards her campaign. And running on the idea of more bailouts
when the German economy is contracting is political suicide.
Thus, we have something of a
capital freeze occurring in the US at the very same time that the primary
pillar of EU stability (Germany) will very likely begin to pull back from
providing additional aid (case in point, Greece is still waiting on receiving
proposed aid from six months ago).
All of these items point
towards what will be a particularly ugly 2013.
If you’re an individual
investor (not a day trader) looking for the means of profiting from all of
this… particularly the US going over the fiscal cliff… then you NEED to check
out my Private
Wealth Advisory newsletter.
Indeed, 74 out of our last 88
trades have made money for Private Wealth Advisory subscribers. That’s an incredible 84%
success rate on our investments.
And we’re not getting
complacent by any means. In fact, I’m about to alert Private
Wealth Advisory subscribers to several trades that will all produce HUGE profits
when the we go over the fiscal cliff in the coming weeks.
You’ll find out what they are
the minute you subscribe to Private Wealth Advisory. You’ll also gain immediate access to my Protect
Your Family, Protect Your Savings, and Protect Your
Portfolio Special Reports outlining how to prepare these areas of
your life for the coming Great Crisis.
These reports outline:
1) how to prepare for bank
holidays
2) which banks to
avoid
3) how much bullion
to own
4) how much cash is
needed to get through systemic crises
5) how much food to
stockpile, what kind to get, and where to get it
And more…
To take out an annual
subscription to Private
Wealth Advisory now… start profiting from the market’s gyrations (again we’ve made
money on 74 out of 88 trades in the last 18 months)… and gain access to all my
Special Reports…’
Best Regards,
Graham Summers