Growing government likely to keep bull at bay

I want to make a new friend in Washington. I would like to believe the Environmental Protection Agency can be that friend.
All I need to do is get the folks there to like me, then convince them it’s the economic environment they need to protect
instead of the natural world.

I know I am going to need much more than the EPA in order to get America back on track. Education, Homeland Security, Energy,
you name them. Every department needs to pitch in, and soon.

Taxes are starting to increase around the world. The Bush tax cuts will expire at the end of 2010, and England just raised
its top rate to 50 percent.

Our current administration is calling some of our biggest employers—the ones who do business overseas—tax scammers in an attempt
to increase their tax burden.

The president has said many times recently that government is our only way out of the economic mess we are in. I think you
know how well government would do trying to create the millions of good jobs to replace those we will lose if Intel, Coke,
Procter & Gamble, IBM, Microsoft, Eli Lilly and others pick up and leave due to unfair tax consequences.

This threat is real and the danger is imminent.

The size of our government is increasing at an almost unprecedented rate. President Obama is wrong when he says government
is the only solution. In reality, his thoughts are tragically flawed. Government, as we know it today, is the problem.

So many of the hard issues that folks in Washington, D.C., are trying to deal with today can be solved if they would simply
do less of what they are doing. Bigger government necessitates more government control. Increasing government control will
lead to higher unemployment, less-educated citizens, less-efficient energy use, worsening environmental conditions, and a general
decline in our standard of living.

This absolutely has to stop!

Washington has to create a better environment. Officials need to rebuild the sandbox that existed here from 1776 until 1913.
Those were truly ideal conditions for entrepreneurs to create firms, innovate and improve productivity that led to all the
wealth and quality of life we now enjoy.

The stock market can experience temporary rallies during a steady decline. There were times in the 1930s that saw robust upward
moves in the stock market. But it was not sustainable. The standard of living of the average American did not improve until
World War II broke out. And if not for the war, the stock market and the fortunes of millions of Americans would have kept
floundering for decades.

I have stayed with this rally from the beginning and I still believe in it. We have a few more weeks, and perhaps as much
as a month or two, before the bear market reasserts itself. Continue to exercise a little caution because bear-market rallies
can come to an abrupt end and the multimonth gains can disappear in weeks. Oh, and check out silver. It could see new rally
highs in the next few months.


Hauke is the CEO of Samex Capital Advisors, a locally based money manager. His column appears every other week. Views expressed
here are the writer’s. Hauke can be reached at (317) 203-3365 or at

Please enable JavaScript to view this content.

Story Continues Below

Editor's note: You can comment on IBJ stories by signing in to your IBJ account. If you have not registered, please sign up for a free account now. Please note our updated comment policy that will govern how comments are moderated.

{{ articles_remaining }}
Free {{ article_text }} Remaining
{{ articles_remaining }}
Free {{ article_text }} Remaining Article limit resets on
{{ count_down }}