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Seven reasons the market is not going up any time soon: #7 The government is gasping for air

Yes, Uncle Sam is going to continue buying stuff and stimulizing (a new word for the new economy) with money it prints. And -- getting back to pure Yogisms -- it ain't gonna work.

The net decline in wealth -- including the stock market, housing, private equity, etc. -- plus the withdrawal of credit now totals $415 trillion or more. You think $700 billion for concrete and a fat guy holding a "Go Slow" sign is going to help?

Roosevelt calmed people by spending a fortune in and on the Works Progress Administration (WPA) -- great buildings and better murals, but not a lot of long-term economic impact.

We are a bit too advanced for that kind of naïve reaction. Not to mention the government is going to need many more trillions to fix the financial system.

And that's the rub -- even Uncle Sam cannot help too much, long term, as the world kicks its addiction to excess credit. And with that goes a big drop in fundamental demand, from the United States to China.

Be sure to read all 7 reasons the stock market isn't going up any time soon.

Michael Shulman is a contributor to OptionsZone.com.

Comfort Zone Investing: Government has a limited role in free enterprise

Ted Allrich is the founder of The Online Investor and author of the book: Comfort Zone Investing: Build Wealth and Sleep Well at Night. In this weekly column, he'll offer advice to investors who are just getting started.

There must be something in the Treasury, Federal Reserve, Senate, and Congressional water bottles that's causing brain damage.

While the initial idea of saving the banking industry to avoid a crisis of confidence made sense because capitalism depends on trust in the banking world, there's a new fever going around that's much more dangerous.

Continue reading Comfort Zone Investing: Government has a limited role in free enterprise

Symbol Lookup
IndexesChangePrice
DJIA+20.0310,246.97
NASDAQ-2.982,151.08
S&P 500-0.071,093.01

Last updated: November 10, 2009: 09:19 PM

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