 |
Home > Publications > Wall Street Strategies > Article
|
|
 |
|
|
 |
 Securities Operations Forum has a special arrangement with Wall Street Strategies to provide access to this daily market commentary for free to SOF users. WSS provides independent investment advice and is not affiliated with any broker or underwriter. To receive a free personal email with the daily commentary, subscribe here.
|
 |
 |
 |
 |
| 2012-01-18 08:03 |
INTERNET GONE BLACK
|
And the sign says "Anybody caught trespassing will be shot on sight"
So I jumped the fence and I yelled at the
house
Hey! What gives you the right!
To put up a fence and keep me out, or to keep Mother Nature in
If God was here, he'd tell it to your
face, man, you're some kind of sinner
- "Signs" Tesla
The Internet has been a marvel of information swirling around and zooming at the
speed of light. It's empowered people and sparked revolts, its created super stars (see Justin Bieber) and it's for the most part been the most
important innovation of this generation (by the way in last week's poll on the best invention/innovation not a single person mentioned the
television). But the super information highway is also seen by many as a lawless road where hijacking other peoples stuff from creative content to
identities makes it the most dangerous place in the world. It's the notion of content that now pits Washington down the middle and has made Hollywood
and Silicon Valley take opposite sides.
Hatfields and McCoys
The Stop Online Piracy Act is designed to let owners of content
target American websites that aren't knowingly hosting pirated content. Of course, the most successful websites in America are those that rely heavily
on user content, which may or may not be pirated from other sources. The law would allow media companies to get a court order to block payments to
offending websites, in effect shutting down those sites.
That means companies like Facebook, Wikipedia, and Twitter could potentially be shut
down by a movie production company. Of course, the movie production company says its stuff illegally makes it on the web and hurts its sales.
Today Wikipedia will be dark in protest of this new potential law that it says is "censorship without due process" and violates freedom of
speech. In response to this action Christopher Dodd, head of the Motion Picture Association of America, said blacking out Wikipedia and other sites
(Reddit, Boing Boing, and Mozilla) is an "abuse of power given the freedoms these companies enjoy in the marketplace today." He went on to call the
protest "dangerous" while setting a precedent for "platforms that serve as gateways to information to intentionally skew the facts."
The SOPA
bill and another seemed destined for passage, but it's highly unlikely now with members of both parties in retreat, although the issue isn't going
away. Hollywood and other content creators want their money and have a lot of juice. But the power of the Internet is on full display and will win the
day for now by pulling the plug.
Yesterday's Poll and Food Stamp Nation
As usual, I got great replies to the question of the
day yesterday, including one that suggested ending all welfare (whatever constitutes free money from the government) to all who receive it at the end
of one year from the time it is announced. This is a hot topic considering Newt Gingrich repeated comments of President Obama being the "Food Stamp"
President. I happen to agree and think it's one of the great tragedies of our time. Moreover, it's even more insulting when the administration
actually boasts of this accomplishment and says it's trying to get even more people on the program. (I think Newt has a very un-artful way of saying
this that blocks those that should be listening from considering the true implications of the statement.)
Nancy Pelosi has talked about it as a
way to boost the economy because of some minute multiplier effect. The fact is we aren't just discussing immediate economic impact from so many people
living from those government checks but also long term human and economic toll. Those that envision some kind of equal utopia that can only be
achieved by bashing the upper end of the economic brackets have to wake up to the realization everyone is getting hurt to the point of no return. I'm
bracing for all the attacks on the rich, and success, and profits that have the affect of clearing the way for formal attempts to confiscate wealth
while at the same time excusing shortcomings of millions of people.
You can't say "hey buddy get off that damn sofa," because it's politically
incorrect. Yet it's morally and economically the right thing to do.
"The Worldly Philosophers" reveals Thorstein Veblen comments that he was
not sure that the forces that bound society together were the interplay of rationally calculated "self interest," and he wasn't convinced that leisure
was in and of itself preferable to work. His reading introduced him to the ways of little known people like American Indians and the Ainus of Japan,
the Todas of the Nilgiri hills, and Bushmen of Australia. These groups of people lacked so-called leisure classes; so everyone had to work in order to
insure survival. Tasks didn't matter as nobody felt demeaned by their job. There was a natural pride of workmanship and a parental feeling of concern
for the future generations.
So, what happens to children born into a home on welfare and food stamps? For years there was still the notion that
desperate circumstances were temporary and so potential earners in those homes hit the road to find a way to make it happen. It goes much deeper of
course. In those pre-industrial societies men strove to outdo each other in the performance of their chores/jobs. If an absence from labor (leisure)
was condoned, it was not respected. Today, every speech from President Obama tells every single person that is chronically unemployed, receiving food
stamps and welfare, that their circumstance is no fault of their own.
A lot of people are unemployed because they simply lack certain skills.
More to the point, people are being lured into a situation where the longer they stay on the sidelines the longer they're going to have to stay on the
sidelines. There is no shame if somehow you really believe Wall Street lost your job but what about those old paternal feelings for future
generations. This is where the epidemic of long term government assistance makes its most nefarious impact on the nation. There comes a point where
people shift from being embarrassed and motivated by food stamps to indifference about stigma or work.
Their future generations grow up with
the same ambivalence and lack of determination to evolve and tap into innate gifts, becoming productive and prideful members of society.
Of
course, Veblen argued against capitalism and the leisure class with an argument that other societies like Polynesians and ancient Icelanders, along
with the Shogunates of Japan, lived in a different pre-industrial society. Their work was predatory, where they seized their riches by force or
cunning and took no part in the actual production of wealth by sweat or skill. This action was taken with the approval and admiration of the general
populace to the point where the leisure rank was looked up to as the strong and able. This led to a change in perception toward work. Pure labor came
to be regarded as honorific and with indignity.
This society lives in modern life, according to Veblen, while the predatory class seizes goods
without work.
Mitt's Tax Problem
It's interesting that close to 50 million Americans are on food stamps and the central issue in
the 2012 race for the White House is how much taxes one candidate is paying. We are talking about someone that's putting money into the kitty - a lot
of money at that. But much is going to be made about Mitt Romney's 15% tax rate that he pays on income from investments. It is such a misguided
gambit, but has been so central to the war on the profit motive from day one that the media and White House are poised to pounce. When Americans
wonder where money will come from to make the kind of investments that bring us great companies large and small, they should understand increasing
taxes on investment income will make it harder.
By the way, according to the Tax Foundation 75% of American tax payers pay less than 15% a year
and only 25% pay more. If those paying less than 15% voted for Romney in a general election for the White House it would be the widest margin of
victory in history. But the current occupant of the White House has already released a statement on Romney paying his "fair share" and they will layer
this thing on thicker and thicker as the year moves along.
The hope is like a dog barking at a squirrel, so transfixed that it misses the house
burning down, Americans will forget four years of failure and put all their energy and anger into hunting down the rich.
Today's
Session
I didn't like the way the market waffled into the second half of trading, and that same blasé feeling permeates the air
this morning. Economic data was okay and Goldman beat, but the market yearns for a real catalyst. S&P 1,300 is one of those round figures that
might need an extra push or several pushes to really clear. We aren't forcing the issue this morning but are watching this IMF scuttlebutt because
it's going to cost you a lot of money, even as BRIC nations chip in more.
| Delivery, and or timely delivery of Internet mail is not guaranteed. Wall Street Strategies therefore recommends that you do not rely on email
as your sole method of communication with us. We recommend using your company email address or one issued to you by your Internet Service Provider.
Free web-based email accounts like Hotmail and Yahoo are not advised as they are subject to quotas, filters and frequent delays.
Disclaimer:
All investment entails inherent risk. Wall Street Strategies' research seeks to assist investors in determining when to buy and when to sell to
attempt to maximize profits or minimize losses. All final investment decisions are yours and as a result you could make or lose money. Wall Street
Strategies, its employees and/or its affiliates and family members may from time to time take positions in the open market or otherwise with respect
to the securities discussed. Wall Street Strategies, its employees and/or affiliates do not have stock ownership equal to or greater than 1% of the
outstanding stock of the covered company nor does any employee of Wall Street Strategies sit on the Board of Directors of any covered company. Wall
Street Strategies is not a broker/dealer, and the firm does not underwrite securities, manage assets or perform investment banking activities. The
statements made herein include information obtained from sources believed to be reliable, but no independent verification has been made and we do not
guarantee its accuracy or completeness. The statements made herein contain general information and do not constitute an offer to buy or sell any
security.
61 BROADWAY SUITE 1425, NEW YORK, NY 10006 Tel: 212-514-9500 Fax: 212-514-9582 | | Manage Your Mail | | This email was sent to
wstreet@soforum.com - 58340 | |
|
 |
Disclaimer: Securities Operations Forum is providing this research to assist investors in determining when to buy and when to sell. All investment decisions are yours and as a result you could make or lose money. Securities Operations Forum, its employees and/or its affiliates and family members may from time to time take positions in the open market or otherwise with respect to the securities discussed, but not have stock ownership equal to or greater than 1% of the outstanding stock of the covered company nor does any employee of Securities Operations Forum sit on the Board of Directors of any covered company. The statements made herein include information obtained from sources believed to be reliable, but no independent verification has been made and we do not guarantee its accuracy or completeness. The statements made herein contain general information and do not constitute an offer to buy or sell any security. |
