Delaying Tax Vote Could Crash Stock Market

[CARLHAYDEN]

Delaying Tax Vote Could Crash Stock Market

By Paul Bedard

Posted: December 2, 2010

Failure by Congress to extend the Bush tax cuts, especially locking in the 15 percent capital gains tax rate, will spark a stock market sell off starting December 15 as investors move to lock in gains at a lower rate than the 20 percent it would jump to next year, warn analysts.

http://politics.usnews.com/news/blogs/washington-whispers/2010/12/2/delaying-tax-vote-could-crash-stock-market.html

[Landslide Lyndon]

[opebo]

Ha ha.  Buying opportunity for Jan 1., CarlHayden.

[WillK]

Ha ha.  Buying opportunity for Jan 1., CarlHayden.

Exactly -- one person's panic sell is another person's buying opportunity.

It makes sense that some investors will want to sell.  But if the price drops too much, they will stop selling.  The point is to account for capital gains within FY 2010.  If the price drops a lot, there wont be much gain so it becomes foolish to sell.    Also, we can expect these same investors to buy back in once the new year starts. 

So in general, my reaction to this story is so what.

[CARLHAYDEN]

Ha ha.  Buying opportunity for Jan 1., CarlHayden.

Er, the markets are closed on New Years.

[opebo]

Ha ha.  Buying opportunity for Jan 1., CarlHayden.

Er, the markets are closed on New Years.

Well I hardly think my thesis is altered by a delay of one day, Coilhardon.

[angus]

Nifty keyboard you got there.  Mine has this thing in that spot:




Interesting article.  The market certainly doesn't like uncertainty, and if they don't act then it'll be uncertain whether there will be reductions in the future.  But that's not really the focus of the article.  They're looking at real hikes in the cap gains and AMT and comparing it to 1987.  It could happen.

If you click on the "who gets money" link in the first paragraph you see that the Finance & Credit industry donates about evenly (per member) to Democrats in the House, but more to Republicans in the Senate.  I wonder why that is.

[Sbane]

I hope it crashes the market. Would be an excellent opportunity to buy.

Seriously, some of these financial prognosticators are so full of sh**t.

[○∙◄☻¥tπ[╪AV┼cVê└]

Fine with me.

[??????????]

Fine with me.

I hope it crashes the market. Would be an excellent opportunity to buy.

Yes and Yes!

[Sbane]

Fine with me.

I hope it crashes the market. Would be an excellent opportunity to buy.

Yes and Yes!

If there is a crash, it's not going to be because capital gains tax rates could go up by 5%.

[??????????]

Ok, what's going to stop the sell off?

[Sbane]

Ok, what's going to stop the sell off?

If there is any sell off due to tax rate changes, it will be modest. Let's get serious here, the market will really move due to things like the European debt crisis, the housing crisis/banks, consumer sentiment/spending etc.