The Biggest Tax Break for US ...........

If you want to look at what can make the US economy get energized you only have to look at the gas pump. We don't have to tell you what a 40% year on year increase in a barrel of oil has had on the economy. Oil impacts us at every level from the plastics we use for cars, computers and toothbrushes to fuel for trucking our products to the retail outlets we all buy from. All this adds up to a non-tax, tax, on the American consumer. The increase in fuel prices directs more of the economy's cash flow in a single direction, petroleum producers both domestic and foreign. Right now we export $800M per day to foreign countries for our fuel appetite. That is almost $300B per year or close to 1/2 of the stimulus package.

If our country would adopt an expansive energy policy that would open up drilling both on and off shore we would enjoy 3 direct benefits:

• Lower prices for fuel impacting consumable goods and the fuel pump. Just reducing the price of gasoline $.50 per gallon would spread $180M per day to other industries when consumers would spend on other items. This could translate to over $300B in growth in GNP which would could add a net 1% increase to GDP.
• Greater employment would result as consumer businesses would again have the traffic flow necessary to create a better hiring environment. We believe that the economy would add an average of 80,000 people to the employment rolls per month alone. 
• An average well needs 50 employees and generates $1.5m to the local economy. Pennsylvania has been enjoying a boom in the shale areas due to the resurgence in gas and oil well development. We do not have the economic impact numbers on off shore drilling but suffice it to say that the impact to local economies which are home base for off shore drillers are even more significant. 

An effective energy policy may do more to lift this economy than any one other change. It would lead to better homeland security, greater disposable income for the consumer and a broader tax base to draw from to help reduce our significant outstanding debt.

Why is it that things that seem so simply are not in Washington DC, even the Prophet has trouble seeing that.

Markets remain less volitile, keep your powder dry and remember you cannot lose by taking a profit.

The Prophet