The Election: Good for Advisors or Bad?

I think that the majority view is wrong about Romney being better for the financial advisors. Romney's plan to stimulate growth by lowering taxes is not a good recipe for success. Cutting taxes is a very ineffective method of stimulating the economy, especially when the tax cuts are focused on upper income earners. Tax cuts for wealthy individuals are saved more than they are spent. Furthermore, regulation has proven time and time again to be necessary in the financial industry. Lax regulation has proven to have disastrous consequences for securities markets (Great Depression, Great recession - both partially caused by lax regulations.) I don't think we need more regulations but certainly not less. One of the key reasons for the Great recession was a SEC decision to allow broker dealers to substantially increase leverage. I don't think Obama has great ideas on how to improve the economy but I don't think he will make it worse either.

But I agree while tax cuts aren't necessairly a magic formula for major growth of the economy, keeping them higher or raising them also doesn't seem to be a magic formula for increasing tax revenue.

Charts from the IRS show tax revenues not making any significant difference with changes in tax rates over the years but show substantial differences depending on GDP growth. Taxing the rich is popular for votes; for us advisors, it's disappointing in one sense, but allows for many opportunities to find alternative value to our clients.

Did you see the Huntsman tax plan? I think that is a darn good start. Just raising marginal rates isn't going to do shit to help with our debt problems. It's a bandaid. We need fundemental tax reform. I think lowering the rates and getting rid of all deductions and credits is a great start. I think we need to make sure that hedge funds, tech companies, hollywood, and other companies are not getting special treatment. The problem with our country is all the kick backs are built into the tax code. All of the speical interests are so invested in making sure they get speical treatment within the code and no one wants to talk about it. We cannot just raise taxes on the income earners and expect it to fix anything. I also believe, and because I heard from so many in Hollywood that people need to pay their fair share that we should go after the dishonest hollywood accounting schemes and reinstate the 20% excise tax on movie tickets, dvd/blu ray sales and movie downloads. Hollywood helped us after WW2 and I think it's about itme they help us again.