Gold prices reaching record highs.
Value of the dollar dropping against world currencies
US faces paying for huge national debt left by the Bush experience
Here's some advice for you rich folks:
Rich should buy stuff now
By Thomas Kostigen, MarketWatch
SANTA MONICA, Calif. (MarketWatch) -- If you have a lot of money, buy that luxury item you've been eyeing -- now.
Wealthy people have a limited window before they will likely get whacked with additional income taxes, cutting into their spending power. Also, with the economy wobbling, inflation rising and consumer prices increasing there will likely be no time like the present to get the most bang for the buck.
The top three Democrat candidates for the presidency, Sens. Hillary Clinton and Barack Obama as well as John Edwards, are proposing big tax increases on incomes of the rich. That means if a Democrat lands in the White House in November there will be spending drags ahead.
Households that earn more than $1 million have seen their effective tax rates drop almost five percentage points, from 24.2% to 19.6%, from 2000 to 2004, according to a Congressional Budget Office report last year; they gained the most reductions in income taxes, which have been held at their lowest levels since 1979, the report notes.
More than half of the tax cuts pushed through in the current Bush administration favored the wealthy, especially the top 1% of income earners. In 2006, the tax cuts for that top bracket increased average income by 5.4%, the CBO said.
But rising consumer prices have eaten up much of those gains. Moreover, with the U.S. facing a recession, depending on whom you speak to, and inflation continuing to run, prices of luxury goods are sure to weigh heavily on the rich.
Indeed, prices for luxury goods rose twice as quickly as overall consumer prices last year, according to Forbes's Cost of Living Extremely Well Index, which measures the price of a basket of luxury goods. The wealth bonanza has caused demand for luxury goods to soar, pushing prices to previously unheard of levels, the report said.
