The stock market sits at around 10,000, still down about 3,000 since it's high in 2007. The Obama administration and like minded economists point to the stock market as proof that the economy is turning around. Both seem to ignore important economic data that effects you and I everyday and will definitely effect us in 2010.
1. Don't die in 2010. If you do, your estate will be taxed at pre-2001 levels. All that hard work and sacrifice you made so you can leave your children something after you're gone will be shared with the government. You don't think you could leave this world and not be taxed for doing so did you? This "death" tax could be avoided if Congress extends the deadline indefinitely, but with Pelosi and Reid in charge, that's not likely to happen.
2. Inflation. The US Treasury just printed a bunch of money that wasn't in the economy one year ago. You are already seeing some inflationary prices in gasoline (pegged to the US dollar), groceries, and various other items. How do you control inflation? The Federal Reserve will have to raise interest rates. If you think the credit market is tight right now, just wait and see what happens if they bump up those rates. That's what happens when you try to control the economy using monetary policies instead of using fiscal policies (lower taxes, less spending).
3. Income taxes. First, that tax "cut" that Obama gave us - a whole $13 per week - is in reality a tax rebate, so pay attention when April comes around, because you'll have to pay your money back to the government. Same thing happened tax day 2009 when you had to repay that $600 or $300 you got from the government from the year before. Oh, and don't forget about that Cash For Clunkers rebate and new home rebate. You'll have to pay those back also. Finally, the Bush tax cuts implemented in 2001 are also due to expire in 2010. Again, Congress could stop this but they won't. People, the media, Congress, and President Obama are too busy discussing health care to bother with this tidbit. Most likely, the media, Congress, and President Obama are well aware of this problem but are all in favor of increasing taxes without having to take the political heat by actually voting for tax increases.
4. Health Care Reform. Between taxes on "Cadillac" plans and Pelosi's Value Added Tax, we will all be paying more taxes in 2010, even if Bush's cuts were to be extended. Also, there's the penalties that you will incur if you decide not to buy health insurance. Don't forget that "fat tax" in there also. Weigh too much? Most likely you'll pay a penalty. Smoke? Penalty. Buy a Pepsi or Coke? Pay a tax when you buy it. Like Doritos or cookies? You'll pay a tax on that also.
5. Cap and Tax (Trade). It's amazing and a shame how liberals and Democrats don't believe in the "trickle down" effects of their actions. If you tax businesses on how much they pollute, then that will be passed down to you and I. Inflation from monetary policies aside, prices for goods will go up because of this monstrosity of government environmental regulation. Furthermore, there will also be penalties for you and I if we too pollute too much or we don't switch to those stupid mercury filled, Chinese made curly Q light bulbs or take other steps to "green" our homes. All this without mentioning these regulation will place our businesses at an even further disadvantage against foreign companies.
6. National debt and budget deficit. The budget deficit stands at at record $1.4 TRILLION and our national debt is at an all time high. Congress just keeps spending with no regard to how to pay for everything. Guess who they'll ask to pay the mess off...you and me. Get ready to pay more in taxes, fees, and other ways to fund the Debt Monster. Businesses will also get nailed also, so I guess in one sense your income tax might go down because you won't have a job because of the taxes, fees and other regulation imposed on your employer.
7. The declining US Dollar. Sure, the less the US Dollar is worth, the more attractive our exports are. However, imports are also more expensive! Since most of the junk we like to buy - TVs, iPods, clothes, etc. - are made overseas, wholesalers are paying more for items, which in turn they charge more to those ordering from them, which in turn these stores charge more for the product you want to buy. Notice how the US Dollar dives, oil prices go up. Again, import costs coupled with OPEC influenced "shortages". What happens our international "friends" decide to carry through with their threat of ditching the US Dollar for the Euro or some other "world" currency?
8. Unemployment. Currently, the national unemployment rate sits at almost 10% officially. It's almost at 16% unofficially and 52% unemployment for 16-24 year olds. Less people paying into the system because they don't have jobs. Not too mention, those that have lost their jobs cannot contribute fully in the economy by buying items they normally would. Since businesses seem to be a favorite target of this administration and Congress, I would not expect any jobs to be created anytime soon.
When someone tells you that everything is turning around, just nod your head and walk away. You know better. We know how to truly turn an economy around; it was done in the early 1980s - you know, Ronald Reagan. We know the failed policies of the 1930s doesn't work. It doesn't take a history major or a Nobel winning President or a Nobel winning NY Times economist to figure that out. Unfortunately, those in power are more committed to their egos, pride, and ideology to admit tax cuts, less regulation and less spending is the fastest and the most surest way of getting things off the ground and turned around. The way things are going to take place in 2010, you and I will most likely have to work well into August or later in order to pay our taxes before we can start working for ourselves. That is if we all still have jobs... Quick, grab your wallet before the government gets their grubby hands on it!!!