Deficit Spending Balloons
Research for Online Investors

by John Dalt

8/25/09

The White House leaked that Ben Bernanke would be re-appointed as Chairman of the Federal Reserve.  This covered up the news that the deficits are exploding.  How can Oh! Bama pass all his big government programs, when the country is broke?  Maybe he can’t!  Lack of money and 2010 congressional elections may be enough to stop some of his agenda.  Congressmen and women looking over their shoulder for who is gaining on them may make voting for the next big spending government take over a little more difficult.  That being said, never underestimate the power of twisting arms, and presidential promises.

The Congressional Budget Office (CBO) and the White House released the deficit projections for the next 10-years.  The White House came up to the $9 trillion deficit number the CBO had embraced previously.  The White House predicts the public national debt will reach $17.5 trillion by 2017, 76.5% of gross domestic product.  The key word is “public” as this does not count the I.O.U.’s to Social Security that the government has written since adopting a unified budget in the 1970’s.  It also does not include the estimated $50 to $70 trillion dollars in unfunded mandates in Medicare, Medicaid and Social Security.

On a different note, consumer confidence is improving, and it appears that home prices may have bottomed.  The second quarter saw home price increases of 1.4%. It is not much, but the first increase in three years.  Today’s prices are roughly equal to those found in 2003.  Las Vegas and Detroit still lag the nation as the only two metro areas to show a decline in housing prices.

You really should check out the economic release calendar you can find at “Investor Resources.”  You can click on the arrow in the bottom corners to move to different days.  If you click on a particular release, it will expand with an explanation.  Neat.

We are working on a new premium service for investors.  Our recommendations will be a little more aggressive than the Long-Term Portfolio with an emphasis on income.  As with all of our services, it will be safe enough for self managed retirement accounts.

We should be ready to roll it out by the first week of September. If you are interested, reserve your spot at
customer-service@galtstock.com  We will offer preferred pricing to the first 100 advance reservations.  I will email you the details as soon as they are ready. You are not committing, just reserving your spot. Of course, it will be 100% guaranteed.

I had a great visit with D.H. about our investor services.  D.H. has not managed his own investment or retirement accounts.  He has concentrated on running his business, and placed money in various mutual funds.  We talked about the mechanics of opening an account.

D.H. is a perfect example of why galtstock.com is so important.  I look forward to helping D.H., and you, if you are in the similar circumstances.  I will post a video on Ask John soon about the mechanics of opening an account, and how to get the most out of galtstock.com  One thing D.H. and I discussed is the importance of discipline.  New investors want it all now.  Many times what they get is not what they expected or desired.

Subscriber B.A. told us of hiking the Appalachian Trail.  Seems like a long way to go, a lot of work, and a hard way to get away from the stresses of banking and investing in the bond market.  But hey, I have tilted a few windmills.

I had to leave the office for a few hours today to help my brother.  Sometimes a family farm requires family help.  His summer help has gone back to school, and fertilizer must be applied quickly as wheat-sowing time is rapidly approaching.  My brother is one of the smartest guys I know, at what he knows.  He has farmed for forty years and concentrates on farming every day.  After graduating from college, he decided he wanted to farm.  He has had some success, growing from a few acres to quite a few acres.  Investing is similar.  To be the best, you have to concentrate on it every day.  That is why I am here to help you.  For a few dollars a year, I help you every day.

I found this quote from a famous Kansan:
Farming looks mighty easy when your plow is a pencil, and you’re a thousand miles from the corn field .---President Dwight D. Eisenhower

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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