Sunday, September 4, 2011

Unemployment Question

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There is no doubt that unemployment is one of the most popular topics in the media at the current moment. No wonder, as unemployment remains at high level since the stock market crash in 2008. Whatever the Government does (actually they have done nothing), nothing seems to reduce the number of people without work. If the Government expects that the corporation start opening working places (at least that is their explanation why the corporation should not be taxed) then I could only say THEY ARE WRONG or they think that the people are stupid. A corporation does not need extra expenses, and there is no stimulus for them to open working places in the USA until it is more profitable for them to do it oversea. That is why majority of them moved their customer support to India and China, that is why more and more "made in China" and "made in India" and less and less "made in USA" could be seen on the shelves in our stores. To tell us that if we do not tax the corporation they will have more money (they already have billions) and they will think about expansion and creating work for Americans is keeping us for idiots. We have to tax them and the taxes should be strict.

My proposal - pass it to those who you voted for if you like it:

1. If  more than 20% of corporation's expenses are over-sea's expenses (whatever the expenses are: supplies, customer support, development, etc) than this corporation  has to pay additional 15% tax not from the profit but from the overall over-sea's expenses.

This will make the corporation to think where to expend their business and will make small and medium businesses stronger and more competitive to the big corporations.

2. The exemption from the p.1 are  the companies that has more than 50% of profit coming from export (companies that deal with natural resources, oil, mining and other companies should not be covered by this exemption).

We need to balance import/export and we need t protect those who export.

3. A company that show grows in the number of employees (not over-sea's employees) that worked more than 1 year in this company is entitled for the tax deduction (max 5%)The companies that deal with natural resources, oil, mining and other companies should not be covered by this exemption).

It should definitely attract the companies, small and big to open new working places and make it easier for them to invest the money they have into the company’s expansions.

I could add more points, but I think it is enough for you to start thinking.
Do you think if we would have such policies it would increase the revenue, it would help with trade balance and it would reduce the unemployment?

If your answer is yes, and you like it then 

and Pass it to those who you voted for and those who you are going to vote for

ETFs Analysis

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When it comes to the trading Exchange Traded Funds (ETFs) you have to understand that in most cases ETFs are derived products. They are usually designed / set to track performance of the indexes, groups of stocks or various commodities. As an example QQQ stock is developed to reflect the performance f the Nasdaq 100 index, the SPY stock is set to track the S&P 500 index, IWM tracks the Russell 2000 index, VXX tracks the VIX volatility index, GLD tracks the price of gold USO tracks the price of oil, an so on...

Because of the fact that ETFs are always tracking something they are often called as tracking stocks (they are called stock because these funds are traded exactly like stocks). Because of this tracking ability you have to understand the the price of an ETF is not always driven by the suply and demand in the ETF itself but rather by supply and demand in its benchmark index or benchmark commodity. Respectfully, it is always recommended to analyze benchmark index or commodity in junction with your ETF. So, if for example you trade SPY stock then it is essential to apply technical analysis to the S&P 500 index in the same way you do it with SPY. If you do not do it, then at some moment you may face a situation that despite all signal on SPY it moves in opposite to predicted simply because you did not know about opposite signals on the S&P 500 index.