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Dec. 11, 2004 The American public has spoken, and their choice is George W. Bush. Although there was quite a wave of bitter attacks on the President, particularly from the far left, he prevailed. Hines’ Political Law is that “people will chose the incumbent until their misery level rises above their fear of the unknown.” Obviously the fear of the unknown in the person of Senator Kerry was a factor in this election. Kerry was almost unknowable, with his ever-changing and unstable core representation. At least Bush was knowable, and that served him well. What is unknown is the economic future of America as we sail into the next four years. There are many waves buffeting the ship – the falling dollar, trade deficits, and the federal deficit, which many view as being quite large. President Bush, however, continues to put weight on the supply side approach, which is to use tax cuts as a manner in which to let the economy blossom, which in turn is suppose to take care of many of the other ills. Certainly the approach of cutting taxes (along with the cut in the interest rate) played a big role in the emergence of the American economy from the crash of 2000. With the re-election of George Bush comes the opportunity (and some would say danger) of letting supply side economics really play itself out. Several factors will come into play in the coming few years that provide an interesting speculation of the future. Technology, which was roundly cursed in the media after the dot.com bust, will re-emerge with a vengeance. Consider the adoption of voice-over-Internet- protocol, which in combination with wireless and broadband delivery will make all kinds of new things possible. You and everyone else will soon have a phone/computer/etc with you wherever you go. That will be a big driver in the market. So will Microsoft’s latest schemes, which will include the new system code- named “Long-horn”, and their security moves concerning hardware and the USB port. These factors will cause virtually everyone to convert to new hardware and software – a buying spree potentially as big as the Y2K market. Many people have been sitting on old computers for quite some time, and they will finally upgrade. Ditto that for local and state agencies, a large account by any means, which will also have to upgrade. Toss in the upgrade that everyone will have to make with their television (new standards will make your current set instantly obsolete) and various other related accessories for computer, camera, and television, and we are looking at one of the biggest buying binges on record. Baby boomers are not done spending, according to Harry Dent (see the Next Great Bubble Boom), and the demographics of this group hits maximum purchasing velocity just as the new technology reaches the critical adoption stage. Now, toss in President Bush’s plan to privatize Social Security for the youth and you have even more upward pressure on the market. With all those people entering the stock market en mass, the wave of stock purchasing will be enormous. Add all these factors together, and you have the potential for a volcanic blast in the market never seen before – at least never seen since the mid-20’s, anyway, which Dent likens to this upcoming action. When is the action going to hit? Most indicators point to the time frame of 2006-2008 – which, by the way, is also the final play in the Bush trilogy. ------------ About the author: Dwayne Hines currently has 12 books selling in major bookstores and writes for major magazines such as Physical and FitnessRX. Email Dwayne Hines: dhines@3dinet.com Tell a friend about this site! ------------ All articles are EXCLUSIVE to Useless-Knowledge.com and are not allowed to be posted on other websites. ARTICLE THIEVES WILL BE PROSECUTED! |
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