Jul 01, 2012
In a week where the Supreme Court ruled that it is constitutional to tax economic inactivity – both gold and the stock market ended higher by 2%. Here’s the year-to-date picture.
The upward move in stock prices makes absolutely no sense. The free-market was dealt a severe one-two punch by the U.S. Supreme Court this week. Two specific cases on healthcare and immigration are likely to affect the course of the American Market in dramatic fashion for years to come.(—Remember what happened to the financial industry when government made it too easy for 20 million "Americans" to get low cost mortgages. What started in the 1990’s fell into ruin in 2008.)
Why should we believe a different outcome will come from the government’s intrusion into the healthcare industry?
Have you heard how hard it is to get a mortgage these days? Think about the dreaded outcomes possible with a market crash in healthcare – one where consumers are unable or unwilling to pay for health services, health insurers are broke, and hospitals and doctors are not capable of supplying demand (a.k.a. saving anonymous lives.) Think about that disaster.
It’ll take me a little more time to sort out this week’s court rulings. I will deliver that analysis, of course, right here as soon as I get it.
Until then, know that it’s always a good time to reevaluate your financial plan and objectives when things drastically change in Markets. If you are unsure what to do, play defense until you have the situation fully evaluated. If you can’t wait and must move right now, sell your positions and move the proceeds into cash. The dry powder won’t burn a hole in your pocket. Should you have no idea what to do, don’t hesitate to contact me.