Editor's note: Dan is in New York attending the Grant's Spring Investment Conference. Expect some updates on Thursday.
You may remember our point yesterday that OBAMA!'s new health care plan violates the U.S. Constitution...
We don't recall reading in the Constitution where Congress was given the right to force citizens to buy health insurance. Of course, we've long since realized there is no true check on the government's power. And we're probably just being naïve dreamers by expecting the spirit of the Constitution to mean anything to our current crop of leaders.
But we look forward to reading future Supreme Court decisions about this law. It will at least be entertaining to see how it can twist the plain and obvious meaning of the 10th Amendment, which clearly states powers not expressly given to Congress are strictly reserved for the states: "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people." So much for a constitutional, limited government...
Well, today, OBAMA! signed the bill into law and his actions spurred some state officials to dust off their copies of the Constitution and speak up. Thirteen state attorneys general are filing lawsuits to block the health care bill. Four state legislatures have already passed laws blocking the bill. And tomorrow, Virginia's governor will sign a bill into the state's law making it illegal for the federal government to force Americans to purchase health insurance.
We applaud these states' efforts, but it's going to be an uphill battle. Good luck.
In his latest update, Doc Eifrig warned readers about the dangers of the overly bureacratic U.S. health care system. He gave his readers some great tips on dealing with hospital staff and doctors, and told readers how vigilance probably saved his mother's life. Here's what he said:
Almost 10 years ago, an Institute of Medicine study uncovered nearly 7,000 people die every year in the U.S. from medication errors. The causes range from physician handwriting to nurses not distinguishing among look-alike packaging.
Please scrutinize the pills you're given... When you go to the hospital or even a doctor visit, bring your own list of meds. List the colors of the pills, shapes, milligrams, and schedule you've been taking them. If you sense any deviation from the plan, ask for clarification. Get a copy of the medications the staff claims you're supposed to get.
And under no circumstances should you back down if you think the staff is wrong. Ask for the head nurse or even the doctor to come and explain what medications you're taking and why. The why is the most important piece – you need to understand the purpose for each and every medication – because otherwise you're dependent on the staff to get it right. And as I've told you, the systems aren't in place to prevent these errors.
Now, with the new health care bill passed into law, knowing what to do and ask is even more critical. In Retirement Millionaire, Doc tells you when to avoid hospitals, how to ensure you're getting the correct treatment, and even ways to get free prescription drugs. To access this information, click here.
Lots of bearish news surrounding China today... On the technical side, The Pragmatic Capitalist, a leading financial blog, points out the Shanghai stock market is forming a bearish "death cross" pattern. As you can see from the chart below, a death cross is formed when a short-term moving average crosses the long-term moving average from top to bottom.
The last time this pattern occurred, in early 2008, the Shanghai market plummeted 60%.
Even China super bull Jim Rogers sees bubbles forming in the country. Due to Chinese currency controls, "right now all that money is trapped in China and they have various bubbles developing. It always happens when money cannot escape an economy and there's a lot of money... sloshing around," Rogers recently told CNBC. In particular, he sees real estate bubbles developing.
And famed short seller Jim Chanos calls China "Dubai times 1,000," or worse. Chanos says 30 billion square feet of commercial space is being constructed in China.
Advanced Income editor Jeff Clark has also weighed in on the China debate, saying the lack of a U.S. consumer will crush China's export economy...
Make no mistake, the Chinese economy – much like the U.S. economy – relies on the U.S. consumer. If Americans aren't buying big-screen TVs, $100 sneakers, or rubber dog poop, then Chinese stocks are ultimately headed for trouble... The American consumer isn't buying. – Jeff Clark, September 2009, Advanced Income
Since September, Jeff has constructed several super-safe trades for his readers to profit from China's decline. His latest short-China trade returned more than 20%. And in his most recent issue, Jeff is doing it again. He's recommended two China trades. One will make money no matter which direction the Chinese market goes. He expects a 20% return over the next three months. The other, more aggressive trade is a surefire way to make 50% over the next three months.
With the U.S. stock market as overbought as it is right now, there aren't many good opportunities on the long side. But we know markets can remain irrational for a long time, so an all-out short is premature. Jeff's latest hedged trades are the safest profit opportunities we've seen. To receive Jeff's latest recommendation, click here...
New highs: Fairholme Fund (FAIRX), Washington REIT (WRE), Powershares Dynamic Biotech Fund (PBE), McDonald's (MCD), Intel (INTC), Sequoia Fund (SEQUX), Prestige Brands (PBH), Philip Morris (PM), Automatic Data Processing (ADP), Portfolio Recovery Associates (PRAA), Dana Holding (DAN), American Axle (AXL), HMS Holdings (HMSY), Molina Healthcare (MOH).
We're still receiving more letters of support for Porter's SEC case. Keep 'em coming... feedback@stansberryresearch.com.
"Whenever I discuss the country's future with friends, I make them an offer: Give me three good reasons why I should be optimistic about what's in store for the country – and I'll give you thirty good reasons why we'll never again see the liberty and prosperity that my generation (I'm 53) grew up with. Notwithstanding the many and varied reasons why our future is bleak, there is one overriding reason: When so many of the voting public has so little idea as to the ideals on which our country was founded (contained in the Declaration, Constitution, Federalist Papers, etc.), how can they be expected to defend it when it is attacked by the likes of the administration in Washington? The answer is, they cannot. They're too busy worrying about sports, and American Idol, and all manner of stupid and irrelevant distractions, to worry about the issues that our Founders knew were critical for the continuance of liberty and of the republic itself. All I can say is: God help the United States." – Paid-up subscriber Ted M.
"Sounds to me like we need to take all SEC decision-makers on a hunting trip." – Paid-up subscriber Fred
Goldsmith comment: Only if we can get Cheney to come along.
Regards,
Sean Goldsmith
Baltimore, Maryland
March 23, 2010