If anything, this huge rally in dollars and plunge in treasury yields means we need things that will increase liquidity and risk taking such as more QE and tax cuts . There is so much demand for the safe haven of US dollars that for the fed and politicians to no be taking advantage of this is a wasted opportunity . The US economy, although it’s very strong, isn’t running at its full potential. By ‘full potential’ we don’t mean in the liberal sense of more GDP growth and employment; instead, we mean pro-growth policy in the spirit of supply side economics. Here are some pro-growth ideas:
1. Undoing the 2013 tax hike and lowing income taxes for the highest of income earners
2. Increase deductions. Allow losses from stock and real esate transactions to offset income taxes.
3. Elliminate long-term capital gains taxes and reduce short-term gains to the long-term rate.
4. Increase the mortgage interest deduction.
5. Dividend taxes are a form of double taxation. Elliminate them.
6. Instead of welfare, a basic income for individuals with a college degree in subjects deemed useful (STEM, history, English, economics, finance, accounting) and or a verifiable IQ above a certain threshold.
7. A national genome database. Everyone on welfare or under dissability must have thier genome sequenced; individuals with genes linked to low-IQ, crime and other undeseriable traits are prohibited from reproducing unless their income rises above a certain threshold.
8. To help create the next Tesla or SpaceX, more government subsidies to fund innovative companies.
9. End tapering and replace it with a new QE program.
10. A pledge by the fed to not raise interest rates. All rate hikes off the table.
11. Lower the corperate income tax.
The best thing that can happen for the economy and national defense is to have republicans control all three branches of govt. and these is a strong likelihood of happening in 2016, upon which the libertarian faction will merge with the mainstream and that will bring the neocon resurgence with policy similar to that of Bush and Reagan.The good news is when push comes to shove, congress does get its act together such as in 2001 and 2008.