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President Obama addressed a rare joint session of Congress on September 9 when he spoke at length about his desire to substantially reform America’s healthcare system. Whether you are among the apprx. 56% of Americans who now oppose the healthcare reform bill in the House, or you are among the apprx. 43% who support it (latest Rasmussen poll), it is important to know the facts - a number of which the president failed to address or misrepresented in his speech.

While I have refrained from writing at length on the healthcare reform debate, I feel the issue is just too important, and too politically charged, not to speak out. In the pages that follow, we will delve into some of the biggest problems and challenges with the House healthcare bill, H.R. 3200 - America's Affordable Health Choices Act of 2009. Given that there is so much misinformation on healthcare reform out there, on both sides, maybe this will help.

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Last Wednesday, President Obama announced the most sweeping financial industry reforms since the Securities and Exchange Commission was created in 1934. Obama unveiled new proposals that would refashion the federal rules governing almost every corner of finance, and will push the government and the Federal Reserve much more deeply into banks and the private markets. I will discuss these massive changes and tell you why I do not believe they will be good for the markets or investors, for the most part. We will also look at some new polls which indicate that more Americans are worried about President Obama's trillion dollar deficits than they are about the recession. Lastly, we will look at the latest economic numbers and what they mean. Let's jump right in....

The US unemployment rate soared to 9.4% in May, the highest level in 25 years, and is on track to top 10% by the end of the year. Over six million US jobs have been lost since this recession began. With those chilling numbers in mind, I thought this would be a very good time to revisit a topic I have written about in the past, the Johnson O'Connor Research Foundation, which scientifically tests people's natural aptitudes to determine what career paths would be best for them. Everyone in my family has been through the testing, including me. If you or someone you know has lost his or her job, a trip to Johnson O'Connor could prove to be invaluable. Also, if you have kids or grandkids that don't know what to pursue in college, get them tested - you'll be glad you did....

While the global recession and credit crisis are still in full swing, at least we have finally seen a few positive economic reports of late. Specifically, we have seen some good news in the housing sector where new and existing home sales actually increased nicely in February, following months and months of decline. We also saw an unexpected jump in durable goods orders for last month. These reports, along with the nice jump in the stock markets, have led several noted forecasters to suggest that we've seen the bottom in the recession and the worst of the credit crisis. I am not so convinced.

We will also take a close look at Treasury Secretary Geithner's latest bank bailout plan that would partner government and private investors in a scheme to take toxic assets off of the banks' books, but there is no guarantee that this new plan will work. We'll also examine the Fed's latest plans to buy Treasury debt and more toxic assets from banks. Next, we'll examine the latest report from the Congressional Budget Office regarding President Obama's record large budget for 2010, which the CBO says will result in a massive $2.3 trillion deficit. Can I say, I told you so?

It's a lot to cover in one letter, but I trust you will find it interesting....

Since taking office on January 20, President Barack Obama has proposed new government spending of almost $3 trillion dollars. Yes, $3 trillion consisting of his $787 billion "stimulus" package, up to $2 trillion in bank bailouts proposed by Treasury Secretary Geithner earlier this month, and another $275 billion for homeowners and mortgage companies that Obama announced last week. The question is, who is going to buy this gargantuan amount of US Treasury debt over the next few years? With the global recession, the largest foreign buyers of Treasuries, like China, Japan and Europe, may not be in a position to keep buying our debt. It now appears the US Federal Reserve will be called upon as the "lender of last resort," but the Fed will be forced to print these trillions in new money. That could trigger another round of big inflation (hyperinflation, some predict) in the coming years. This week, I will explore the implications of this record spending and borrowing. Be warned that what follows is not pretty, but it is what it is. The latest plunge in the stock markets is indicative of just how precarious the situation is. As investors, we need to understand what is happening and how to react to it. Let's get started....

The Senate finally passed its version of President Obama's near $1 trillion economic "stimulus" package. But as Americans saw that this so-called stimulus package is loaded with pork-barrel spending and does not include nearly enough in tax cuts and direct incentives, public support for it plummeted. The Republicans' alternative plans that proposed more in tax cuts were ignored (of course). I have numerous problems with the giant stimulus program, especially regarding the "protectionism" elements as you will see. Finally, earlier today Treasury Secretary Geithner announced a new plan to spend $2-$3 trillion to bail out banks, buy troubled assets, unfreeze the credit markets, etc., etc. I will have more to say about this as the details become available....

We have recently learned the details of President-elect Obama's massive income tax overhaul, and the plan is much worse than we had anticipated. Obama's liberal tax plan would give annual tax rebates to millions of Americans who already pay NO income taxes whatsoever. Giving government tax rebate checks to those who already pay zero income taxes is nothing short of expanding the welfare state (or socialism as I prefer to call it). Worst of all, if Obama gets his massive tax plan approved, it will mean that a majority of Americans will pay little or no income taxes, while the so-called "wealthy" will foot the rest of the bill. If we reach such a point, there will be little to no chance of true tax reform for the foreseeable future. Read what follows very carefully....

Since I began writing this E-Letter in 2002, I have always maintained that politics and investments are joined at the hip. The political "solutions" coming out of Washington to address the subprime debt crisis and resulting credit crunch should be more than enough to prove this thesis. This week, I'm going to discuss a political issue where the tie to investments may not be as evident, but it's there. The issue is the potential for liberal judicial appointments during the Obama presidency, and how these may change the legal landscape. President-elect Obama is already on record as supporting the "living document" interpretation of the Constitution, and so will likely favor jurists who share this viewpoint. This could mean more "legislating from the bench" and other forms of liberal judicial activism. If so, all I can say is hold onto your pocket books!...