Thank Jobs it's Friday!
We got a good bounce yesterday – let's see if we can keep it going.
In yesterday's post, I listed the bounce levels we were looking for and the markets took off right at the open and held the day's highs into the close with the NYSE (8,311) and the Russell (827) both making it over their strong bounce targets of 8,280 and 826 and the S&P falling just 4 points shy at 1,427.
So our plan to flip bullish was well-timed but we need a third index over that strong bounce line and then we need to see those 50 dmas taken back to confirm a bullish move. They NYSE is leading us there, well above it's 50 dma of 8,042 but we'll want to see the Russell (832) and S&P (1,434) join it – hopefully on some strong jobs numbers but, with the storm, it's very hard to say how the data will play out.
Speaking of data – the GOP has certainly jumped the shark and thrown off the thin facade of legitimacy they used to have by turning into essentially a Roman Inquisition, of the kind that forced Galileo to recant his teachings that the Earth was not the center of the Universe by pulling their own "Nonpartisan Tax Report" after the study failed to find negative correlation between higher tax rates and economic growth. What whipped Conservatives into a frenzy of denial were the reports' conclusions, which clearly stated:
Throughout the late-1940s and 1950s, the top marginal tax rate was typically above 90%; today it is 35%. Additionally, the top capital gains tax rate was 25% in the 1950s and 1960s, 35% in the 1970s; today it is 15%. The real GDP growth rate averaged 4.2% and real per capita GDP increased annually by 2.4% in the 1950s. In the 2000s, the average real GDP growth rate was 1.7% and real per capita GDP increased annually by less than 1%.
There is not conclusive evidence, however, to substantiate a clear relationship between the 65-year steady reduction in the top tax rates and economic growth. Analysis of such data suggests the reduction in the top tax rates have had little association with saving, investment, or productivity growth. However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income
The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.