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Wall Street Strategies has been providing independent stock market research since 1991 to individual, retail and institutional clients through a balanced approach to investing and trading. Charles Payne, our founder and chief analyst, is routinely sought after for his stock market, political,... More
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  • Look Ma ... Not On Top Of The World ... Not On Top By Charles Payne 0 comments
    Sep 10, 2012 9:24 AM

    If you've got a business -- you didn't build that. Somebody else made that happen. Barack Obama wants a new, modern, successful economy of shared prosperity. Bill Clinton

    The plan to flatten the playing field of life by flattening the wallets of successful people is being driven by this notion that competition isn't a good thing. This plan has been playing out in our schools for years where nobody wins and everyone gets the same trophy. But this is the move that will see everyone getting that same outcome from prosperity created in the country even if they had nothing to do with creating that prosperity.

    It's beyond absurd, but then again, back in 1945 the idea of a split atom flattening an entire city was also ludicrous. There is a war, a declared war, on individual achievement for individual sake. The first phase of the war is taking away credit. It's amazing that anyone would think they could take credit for something earned by others, but this administration has gone an extra step and reassigned credit from people that risk it all, work like dogs, and sweat through sleepless nights to roads and sidewalks.

    This past weekend, I watched a boxing match in which the fighter, who was thoroughly whipped to the point of quitting in the ring, kept saying "I take nothing from him," referring to his superior opponent. He went on to give the other fighter "credit" for winning. While it's true sour grapes to have seen many losers try to take credit from the victor(s), now we are evolving into a world where even those not in the ring or game can take credit and share the purse.

    The real outcome from this new world where success is a four-letter word is that competition becomes unacceptable, and that's exactly what's been happening in America. Last week the World Economic Forum released its global competitive ranking, showing America has slipped once again to an overall ranking of 7 from 5 in the previous year. We used to be number one. We used to want to be number one in the world; it felt great. Now we only rank number 1 in market size. Ironically, America ranks high in areas that we are told are disasters, from infrastructure to labor market efficiency.

    The real shocker is the macro environment, that dark cloud and radioactive fallout that comes from full-throated war on success.

    > Institutions 41
    > Infrastructure 14
    > Macro environment 111
    > Health and primary education 34
    > Higher education and training 8
    > Goods to market efficiency 23
    > Labor market efficiency 6
    > Financial market development 16
    > Technology readiness 11
    > Market size 1
    > Business sophistication 10
    > Innovation 6

    The interesting thing about not wanting competition is how easily government can make that happen. If you don't want success, you create 90,000 jobs a month. If you crush competition by crushing byproducts from wealth to pride, then you get a nation that freefalls from the top of the world.

    The Human Toll

    I've been saying for a long time that the human story about our jobs situation is being overlooked ... eight million people have dropped out of the labor force since inauguration day, which means people have completely given up on the American Dream and on hopes of being self-sufficient. Maybe they've entered into a deal where the government will take care of them, and they will be indentured to such governments. It's not how America became great. Moreover, there is the employment to population ratio, which measures the amount of employment for working age adults, at only 58.3%.

    Considering this is the August number, you would think teenage jobs would be up, but for white teens of working age (16-19) only 28% had a job and for blacks it was 16%. People are giving up.

    That means more welfare, more crime, and more food stamps ... the revised number for June jobs was 45,000 versus 173,000 added on food stamps.

    The government cannot create jobs by raising taxes on the rich, non-rich but successful, businesses, and investments. On the contrary, it's how you destroy jobs. You also destroy jobs with the Sword of Damocles ... the constant campaign that paints successful people and businesses as greedy and valueless. Banks were browbeaten for being "reckless," so it stands to reason they are reluctant to make loans to entrepreneurs and small businesses. And, add in all that cheap money from the Fed and the change in accounting standards back in March 2009 that miraculously took banks from bleeding money to printing profits.

    There is talk about additional gimmicks including special tax breaks for hiring long-term unemployed. I'm not sure about special tax breaks for hiring someone whose skills and work ethic may have eroded after sitting on a sofa for two or three years. If that person has the skills and desire they could make for a very grateful employee, but the fact is we need a nation where job creation is surging and we need to ditch all the election-bait schemes.

    On that note, few people talk about finding people that can do the job. I'm not talking only about those 3.5 million STEM jobs that are going begging but basic math, punctuality and ability to get along with others.

    There is a mood ... a mood where businesses know their taxes will go up, know there will be more rules, know their input cost will move higher, and know President Obama is against profits and understand "shared prosperity" is a euphemism for "shared profits" since the roads are in the public domain so, too, should be profits.

    In a nation with less and less accountability where successful people are beaten up and told they didn't built that, on the other end of the spectrum lazy people or those that otherwise give up also didn't "build" their circumstances and can blame others for failure ... since blaming instead of solving is the message from Washington.

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