Empires have come and gone. Some lasted a blink of an eye and some millennia.
The question is, after 9/11, the rise of China and a great financial crisis, where does the U.S. empire stack up to its predecessors?
Well, it seems the one commonality they all have is the point when their might was undermined by sloth and greed. And entitlements: free bread and circuses. For some it took years, others centuries.
Here, in a compelling and unique address, is what Romulus Augustus, the last emperor of the Roman Empire, might say to President Obama now about how to keep America great.
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- DON’T BE SO ARROGANT, MR. PRESIDENT
- The Latest Obama Outrage: the Family's $100 Million Vacation
- Why The Fiscal Cliff "Deal" is Spelled P-O-R-K
- Why Japan's "Lost Decades" Are Headed to America in 2016
- Here's What President Obama's Win Means For Your Money
- Maybe Romney Did Win, It's Shaping Up to Be a Rough Four Years
- How an Obama Win Affects Investments
- If There's No Winner of Election 2012 Tomorrow, the Market Loses
- What to Expect From Gold Prices If Obama Wins Election 2012
- There's More than Election 2012 Moving the Stock Market Today
- Who Will Win Election 2012 and Lead America Over the Next Four Years?
- Election 2012: Is Today's Presidential Election More About Lost Dreams Or a New Promise?
- Hurtling Over Fiscal Cliff Likely Regardless of Election Outcome
- What to Expect from Gold Prices If Romney Wins Election 2012
- Election 2012: Why America Should Fire Congress
- Election 2012 Means the Real Bernanke Bombshells Won't Fall Until December
Empires have come and gone. Some lasted a blink of an eye and some millennia.
How much do you spend on your summer vacation? American households usually spend about $1,200 per person on summer vacations, according to a recent American Express survey.
Presidents spend more on their vacations than you or I. They have to. Air Force One and security does cost more than loading the Honda and heading to the beach.
Here's how much some recent presidents spent our tax dollars on vacation.
Ronald Reagan spent most of his free time at his California ranch. Taxpayers covered the cost of approximately $8 million for presidential travel during Reagan's first six years in office, according to the Los Angeles Times. That amounts to $1.3 million a year.
For George Bush the cost of flying Air Force One to his Texas ranch was approximately $56,800 per trip, for each of the 180 trips according to Media Matters. President Bush spent Christmas during his two terms at the White House so his staff and secret service could spend the holiday with their family, according to Conservative Byte.
Now Obama plans to blow away all previous presidents' leisure travel costs on our dime with a better than Disney World extravaganza trip to Africa.
However Obama had to cancel the safari because of the need to fill the surrounding jungle with snipers to guard the president from wild animals!
Behind the scenes of the Fiscal Cliff debate, there was plenty of f-bombing, poison pilling, and grandstanding leading up to the deal - and that was before the members of Congress and the Senate actually got serious with their usual ultimatums, followed by earnest- looking sound bites and posturing. But what gets me really riled up is the amount of "pork" contained in the bill...
The hope is that Abe's promises of fresh stimulus, unlimited spending and placing a priority on domestic infrastructure will be the elixir that restores Japan's global muscle.
As a veteran global trader who actually lives in Japan part time each year, and who has for the last 20+ years, let me make a counterpoint with particular force - don't fall for it.
I've heard this mantra eight times since Japan's market collapsed in 1990 - each time a new stimulus plan was launched - and six times since 2006 as each of the six former "newly elected" Prime Ministers came to power.
The bottom line: The Nikkei is still down 73.89% from its December 29, 1989 peak. That means it's going to have to rebound a staggering 283% just to break even.
Now here's the thing. What's happening in Japan is not "someone else's" problem. Nor is it something you should gloss over.
In fact, the pain Japan continues to suffer should scare the hell out of you.
And here's why ...
The so-called "Lost Decade" that's now more than 20 years long in Japan is a portrait of precisely what's to come for us here in the United States.
Perhaps not for a few years yet, but it will happen just as we have already followed in Japan's footsteps with a "lost decade" of our own.
The parallels are staggering.
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Evidently, the markets are struggling, too.
As was widely expected leading up to the election, all of the major averages got slammed in early trading on news of President Obama's victory. Just over an hour into yesterday's session, the Dow dropped 262.51, the S&P 500 tumbled 27.58 and the tech- laden Nasdaq fell 59.55. Oil tanked 2.95% and $2.62 per barrel to $86.08 while 10-year bonds saw yields plummet 6.20% to 1.63%.
There is a bright side, though. Now that all the hoopla is over, investors can get down to business.
Here's what I'm expecting:
Romney's destiny of quiet retirement with his automobile elevator and his Cayman Islands investments will seem greatly preferable to the struggle that awaits the re-elected President Barack Obama.
Internationally, four more years leaves plenty of time for things to go wrong.
In terms of monetary policy, U.S. Federal Reserve Chairman Ben Bernanke's "grand experiment" with quantitative easing will continue at least until Bernanke's second term expires in 2014. We can expect the Fed to continue to expand its balance sheet through asset purchases-primarily mortgage backed bonds- and to keep overnight interest rates near zero.
The Fed currently expects GDP growth of 3% in 2013. Unemployment is expected to continue to decline through 2013 but the unemployment rate may move in fits and starts as more discouraged workers move back into the labor force as conditions improve.
Unless there is an unexpected improvement in the employment situation and housing prices, investors can expect quantitative easing and zero interest rates to remain in place through 2013.
Here are the other ways a President Obama win will affect your investments.
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Leading into Election Day, traders are the most bullish they have been in 10 weeks. Eighteen of 27 gold analysts contacted by Bloomberg News were expecting higher gold prices in the short-term, while only five of the analysts were bearish.
Holdings in gold exchange-traded funds (ETFs) reached a record 2,588.4 metric tons on Nov. 1, which was valued at $140 billion. According to Bloomberg data, holdings in gold ETFs in the past three months have enjoyed their best run since August 2011.
Of course, the rise in bullishness regarding gold is not only due to the presidential election, but also to continued loose monetary policy from the U.S. Federal Reserve. Gold did rise 70% as the Fed bought $2.3 trillion of debt during the first two rounds of quantitative easing.
So should gold investors expect anything to change if President Obama wins re-election?
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But there's more than the election that's affecting markets today.
As voters head to the polls, it's only fitting that the one economic report released today is on jobs.
- Job openings continue sluggish trend- How Americans view the job market and what they expect it to be like under each candidate will be one of the deciding factors in this election. The Labor Department reported on Tuesday that job openings in the U.S. hit a five-month low in September, indicating that the recent drop in unemployment is not an accurate portrayal of the labor market. The number of available jobs fell by 100,000 to 3.56 million and it wasn't because more positions were filled - during September fewer people were hired, as well as fired. If you go back to December 2007, the start of the recession, there were about 1.8 people vying for each position and now that number has almost doubled to 3.4 people. "Hiring is the most costly expense for a business," Kurt Rankin, an economist at PNC Financial Services Group Inc. in Pittsburgh, told Bloomberg News. "Until a framework for policy can be determined, which will come with the election and the resolution of the fiscal cliff, businesses are not likely to ramp up hiring."
As well they should. Almost every Election 2012 poll I've seen has the candidates in a neck-and-neck race headed into today's finish line.
As of press time:
- CNN's survey has them in a dead heat at 49% to 49%.
- Pew Research shows Candidate Romney behind President Obama by a 50% to 47% margin.
- The Politico/George Washington University survey reflects a tie at 48%.
- And the latest NBC/Wall Street Journal numbers show President Obama pulling ahead with 48% compared to Candidate Romney at 47%.
Given these mismatches, I can only hope we're not left counting chads or something equally ridiculous tonight when the polls finally close. The markets really wouldn't like that.
As it is, all the major averages are on hold. Not literally mind you, but figuratively. Nearly every trader and institutional manager I know is treading lightly at the moment.
Because they know that by Wednesday morning half of them will be wrong. That means they'll have to adjust both their outlooks and their portfolios.
In the financial scheme of things, though, the election is a sideshow. The far bigger issue when it comes to your money is the fiscal cliff. And I am not alone in my thinking, either.
A recent CNN poll suggests that 60% of market professionals are far more concerned about what's going to happen when spending cuts and tax increases hit January 1 than they are about who's in the White House.
I don't think they're wrong to be worried, either...
Chile's finance minister, Felipe Larrain told Reuters, "If we're not able to resolve the cliff, that could be the tipping point for a much more complicated scenario in the world economy."
The G20 clearly recognizes the risk of the U.S. falling off of the fiscal cliff.
Comparing the relative risks of the U.S. and Europe, Canadian finance minister Jim Flaherty told Bloomberg Businessweek, "In the near-term, clearly the U.S. situation is the higher risk."
Tomorrow's presidential election may complicate the situation regardless of if U.S. President Barack Obama wins a second term or if Mitt Romney is our next president.
Washington insiders have suggested that, unless there is a wider than expected margin of victory for either candidate, legal challenges are likely, which could put the result of the election in doubt.
In fact, each side has hefty legal teams waiting to jump to action if the election is close.
Gold is expected to continue its rise in 2013, reaching up to the $2,000 mark - or higher.
On Oct. 23, Deutsche Bank analysts called for gold to exceed $2,200 an ounce next year. This came in light of the stimulus measures by central banks.
They wrote in a research note via Commodity Online, "While we have targeted gold prices moving above $2,000/oz. since the beginning of 2011, we believe the Fed's open-ended program of QE announced last month increases our confidence that a surge in the gold price above this level is only a matter of time."
Yesterday (Wednesday), December gold futures closed at $1,719.10.
But if we fast-forward to January, even March 2013, if Romney wins Election 2012, would gold prices be able to continue their upward run?
Here's what a Romney win would do for the yellow metal.
The 112th Congress is up for its biennial performance review, and by all accounts -including its own - it has done a terrible job.
A damning record of failure and incompetence makes it clear why America should fire Congress next week.
"Worst ever? In the modern era, there's not even much room for debate," said USAToday in a recent editorial.
"With power split between the Republican-controlled House and Democrat-led Senate, lawmakers made no discernible progress on major national problems such as exploding entitlement costs, immigration and climate change," USAToday continued. "Not only that, they ran from what in prior years would have been routine legislation."
Polls show that Americans have been more dissatisfied than ever with their "do-nothing Congress."
Gallup's approval rating for Congress, measured monthly, fell to an all-time low of 10% in February, rose into the teens over the spring and early summer before hitting 10% again in August.
Each May Rasmussen Reports conducts a poll that specifically asks people whether they would vote "to get rid of the entire Congress and start over again" if such a thing were possible, or to keep the entire Congress.
This year 68% said they would vote to dismiss the entire group of lawmakers, up from 62% in 2011 and 57% in 2009. Just 12% of those polled said they'd keep this Congress, and 20% were undecided.
Election 2012: Do-Nothing Congress Has No ExcusesMany members of Congress admit they have done a poor job, though they tend to blame the opposing party rather than take responsibility.
"We have spent virtually the entire year avoiding doing serious business because the majority doesn't want to take any difficult votes," Senate Minority Leader Mitch McConnell, R-KY, said last month. "It is really quite embarrassing that the Senate is so dysfunctional."
Meanwhile, Senate Democrats blame the Republican House.
"The Senate has produced bipartisan bills on issues from farm policy to postal reform to China currency," Brian Fallon, a spokesman for the Senate Democratic leadership told The New York Times. "But it takes two chambers to pass a law, and the other side of the building considers compromise a dirty word."
Both sides point fingers, but bipartisan cooperation is part of their job description. And their bosses - you and me - expect results, not excuses and fingerpointing.
"Most people just don't understand why Democrats and Republicans can't get together and split at least some of their differences," Larry Sabato of the University of Virginia's Center for Politics told Reuters.