NO WINNERS - By Charles Payne

Jun. 26, 2015 9:32 AM ET1 Comment
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Long/Short Equity, Portfolio Strategy

Contributor Since 2009

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, and general opinions by several prestigious news organizations. Currently, Mr. Payne is a contributor to the Fox News Network and Fox Business Network. He also hosts his own radio show on KFIAM 640 every Saturday from 2-4pm PST. Mr. Payne recently released his first book entitled Be Smart Act Fast Get Rich. Our all-star analytical team is called first when the media needs to know. We are regularly featured on several well respected finance-oriented radio and television programs such as Fox, CNBC, BNN, WSJ to name a few and widely recognized in the media as a leaders in the analyst community. In addition, Wall Street Strategies is part of Thomson-Reuters Consensus Estimates. Brian Sozzi is an equity research analyst specializing in the softline/hardline goods sectors of the retail industry for Wall Street Strategies Inc. Mr. Sozzi graduated Summa Cum Laude from Dowling College, receiving his Bachelors of Business Administration with a concentration in Finance and Accounting. Routinely sought after as a trusted point of reference for opinions and insight on the global economy and retail sector stock evaluation, Mr. Sozzi is a frequent on air contributor to CNBC, Fox Business Network, and Bloomberg, and is cited regularly by online/print publications that include Forbes, Bloomberg, The Wall Street Journal, Thestreet.com, CBS Marketwatch, Reuters, Seekingalpha, Associated Press, Crain’s NY Business, Fortune, Barron’s, AOL Finance, and the Financial Times. In 2009, Mr. Sozzi became recognized by Starmine as a top-ranked equity research analyst for stocks under coverage in such categories as EPS Estimate Accuracy and Industry Excess Return. Carlos Guillen is an Equity Research Analyst providing coverage of the technology sector for Wall Street Strategies, Inc. Mr. Guillen has had experience working in both the sell side and the buy side. Prior to working as an analyst, he was a Design Engineer for Lambda Electronics. Mr. Guillen holds an M.B.A. from NYU’s Stern School of Business, and he has a B.S. in Electrical Engineering from Manhattan College. David Urani is a research analyst with concentrations on the homebuilding, staffing, medical devices, and logistical services industries. Along with providing institutional clients with up-to-date reports of individual stocks within his industry coverage, David assists the rest of the Wall Street Strategies research desk with timely analysis of vital economic data. A graduate of the A.B. Freeman School of Business at Tulane University, David earned a Bachelor of Science in Management while majoring in finance. With prior training experience running small businesses, he has an eye for key fundamentals that keep Companies running efficiently. David’s insight has been featured in several outside sources, including the Fox Business Network, MarketWatch, and SeekingAlpha. Carlos Guillen is an Equity Research Analyst providing coverage of the technology sector for Wall Street Strategies, Inc. Mr. Guillen has had experience working in both the sell side and the buy side. Prior to working as an analyst, he was a Design Engineer for Lambda Electronics. Mr. Guillen holds an M.B.A. from NYU’s Stern School of Business, and he has a B.S. in Electrical Engineering from Manhattan College.

By now, you've heard all the views about the Supreme Court decision on Obamacare subsidies. However, what you haven't heard are details of how it could impact you and your family.

The Affordable Care Act (ACA) subsidies are based on a sliding scale, which is set by one's income and the poverty rate, ranging between 100% and 400%. At the lower end, the government will pay 97% of your premium at the higher end of 10.5%.

Poverty & ACA Subsidies

100%

200%

300%

400%

Family of One

$11,770

$23,540

$35,310

$47,080

Family of Four

$24,250

$48,500

$72,750

$97,000

Premium % of Income

3%

6.3%

9.5%

9.5%

Wow, this sounds amazing, right. Well, it comes at a price and the money doesn't appear out of thin air. The health cost curve bends as promised, but not in the direction promised. Moreover, the goal of all Americans having insurance will remain a pipe dream; the ACA subsidies will soar to a grand total of $849 billion over the next ten years.

Cost of "Affordable" Healthcare

2015

2025

Total

ACA Subsidies

$28 billion

$103 billion

$849 billion

Medicaid & CHIP

$49 billion

$106 billion

$847 billion

The number of uninsured nonelderly population will decline from 35 million to 27 million.

So, while 87% of folks on healthcare exchanges get some form of assistance with premiums, there are only 11 million in the system versus 154 million who get health insurance at work and 25 million from other sources. Yet obligations on healthcare insurance providers are forcing a surge in premiums and deductibles, which is a big reason so many Americans have opted against Obamacare.

Economically, the plan means fewer full-time jobs, higher medical care for all, and less service. In addition, there's the government overreach that could impact other parts of society.

Is Fair Housing Act the Next Clean Air Act?

The Supreme Court decision was split by a (5-4) vote on the Fair Housing Act. It essentially says that lenders, builders, and insurers could be liable for discriminatory charges, even if their actions were not intentional and racially biased. It's called the "Disparate impact" and it will be big weapon in the quiver to bring about social justice.

This will leave intact prohibitions in banking and renting, but it could also embolden the push by the administration to create integrated neighborhoods in upper middle-class and wealthy neighborhoods.

By controlling zoning and rental practices, the administration will move swiftly to force developers to include units for families that could never afford them otherwise.

Attorney General Loretta Lynch threw down the gauntlet yesterday:

"Bolstered by this important ruling, the Department of Justice will continue to vigorously enforce the Fair Housing Act with every tool at its disposal -- including challenges based on unfair and unacceptable discriminatory effects."

It was a historic day that will reverberate through the nation for years to come. It will also put major pressure on the economy and individual prosperity while substituting government policy, which is an intervention for individual effort and opportunities.

Today's Session

There's speculation of a Greece deal that kicks the can down the road- a whole five months. It's ridiculous, but underscores how stakes are high and even a short break could cause a sigh of relief.

There are lots of pockets of weakness in the market in key areas of the economy. In many ways, it's interesting to hear takes of a bubble when a fifth of the S&P 500 stocks are down more than 20% and these areas are at multi-month lows:

  • Materials (XLB)
  • Industrial (XLI)
  • Real Estate (IYR)
  • Utilities (XLU)
  • Transportation (DJT)

We've closed a fair amount of positions, so everyone should have cash.

Recommended For You

Comments (1)

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.