Tuesday, December 01, 2015
Amsterdam, NY ,



More certainty and opportunity

Tuesday, January 08, 2013 - Updated: 5:51 PM

President Barack Obama's push to increase taxes on upper-income earners unleashed a form of economic stimulus in recent weeks. Some companies increased dividend payments to distribute money to shareholders before rates go up. And investors sold shares to reap gains before the New Year.

The possibility of higher tax rates doesn't fully explain these trends. For companies that had surplus cash, it made sense to return some to shareholders. And even without a looming tax increase, the timing was right for investors to sell some stocks after a strong year on Wall Street.

But it's clear that the political climate -- the probability of higher taxes and the high level of uncertainty about the nation's fiscal path -- has influenced investors.

Viewed from the left, the investors' gains show how the economy is rigged for the wealthy, allowing those with money to cash in even when the economy struggles.

Viewed from the right, the year's performance -- in particular fourth-quarter dividend payouts by companies and sell orders by investors -- shows how tax policy affects economic decisions.

To a degree, both arguments are correct. So the real question is what economic policymakers should do because of these trends. Whatever they do, it's important to remember that the stock market and economy do not necessarily react to political and financial events in the same way.

The year's market gains in part reflect a relatively low starting point and the lack of other attractive investments options. As a result, stocks increased in value across the globe in countries with all types of governments and economies.

Instead of focusing on winners and losers, public officials in Washington should concentrate on addressing problems that undermine the economy.

Investors, whether individuals or companies, need a more certain operating environment.

Those on the lower end of the income scale need more opportunities.

Who knows where the stock market will finish in 2013. But if Congress can provide more certainty and opportunity, it's a good bet that more Americans will have something to toast next New Year's Eve.

-- The Oregonian, Portland


Comments made about this article - 0 Total

Comment on this article

Subscribe to The Recorder


The Recorder Sports Schedule


The Recorder Newscast

Most Popular

    Tonko calls for more support of the MVGO bridge
    Thursday, November 26, 2015

    Stanavich brothers, Derby honored as area's best
    Saturday, November 28, 2015

    Amsterdam to switch on solar array
    Saturday, November 28, 2015

    Donations stolen from holiday lights display on Lyon Street
    Wednesday, November 25, 2015

    Area police agencies increase road patrols for Thanksgiving weekend
    Thursday, November 26, 2015

    Los Angeles Times Movie Guide
    Thursday, November 26, 2015

    Mario J. Greco, Sr.
    Saturday, November 28, 2015

    County legislature tables proposal on revenue sharing agreement
    Wednesday, November 25, 2015

    Gun buyback program returns to Amsterdam
    Saturday, November 28, 2015

    Yo Rocky! Gritty, soulful 'Creed' goes the distance
    Thursday, November 26, 2015


Copyright © McClary Media, Inc.

Privacy Policies: The Recorder

Contact Us