In his morning note, Gluskin-Sheff’s David Rosenberg makes the case for investing in the Great Up North, Canada:
Folks, look below at the chart of what the U.S. top marginal tax rate did from
1932 to 1940 (25% to 80%). It shows who paid for the New Deal and there can
be little doubt that something similar is going to happen this time around —
especially since Obama is running deficits relative to GDP that are double what
FDR ever ran to “save the system”.
Whenever we get a question regarding whether to invest in Canada, we tell them
that the implications of future tax policy on the U.S. dollar will be a dead-weight
drag. Keep in mind that, on average, the annual equity return gap between the
U.S. and Canada in any given year comes down to how the exchange rate
performs. The Loonie’s wings have rarely spanned this wide before.
Believe it or not, at a town hall meeting the President actually said:
“We don’t begrudge success fairly earned. I do think at a certain point you’ve
earned enough money.”
Sounds to me as though capitalism is going to be taking something more than
just a sabbatical.
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