A part of President Obama's State of the Union (SOTU) address will include taxes that will go well beyond punishing the rich. I think they are part of a wider attempt to right the injustices of yesteryear through saving caps and taxes on inheritance that may not have been available to all fifty years ago.

Using hatred and envy of the rich to unleash a torrent of new taxes is not a new ploy; torchbearers beware... taxes are a beast that can turn when unleashed.

Case in point: In 1966, U.S. Secretary of Treasury Joseph Barr, reported that “155” high-income households had paid zero in federal income taxes. This caused an uproar. By 1969, members of Congress received more letters about the "155" high-income households than the Vietnam War. Therefore, a new tax, the Alternative Minimum Tax (AMT) was created.

The AMT tax has been amended in recent years as it once threatened to hit as many as 33 million people; 4.5 million will have to pay and it will largely affect middle-class earners.

Now, President Obama wants to go after Individual Retirement Arrangements (IRAs) because three hundred or so super wealthy families, such as Mitt Romney's have socked away $25 million plus. To make the program fair, the most you will be able to save is $3.4 million, roughly $200,000 annually to live off of. I suppose with any more than that and you are just greedy.

The irony is, back in 1966, those wealthy families earned $200,000, it put them on top, but it would barely keep a family above water in New York City these days.

Another Reason Not to Own a Home

The estate tax is not just rich people's problem anymore. Soon, it is going to be a killer for the rich and the non-rich alike. Let's say your mom leaves you the house, it is worth $250,000, and later you sell it for $300,000. Today, your tax could be based on a $50,000 gain, but not if President Obama gets his way. If your mom and dad paid $50,000 for the house, your tax would be based on a gain of $250,000. It was a good way to soak in more dough and extract justice four years ago when it was harder for some Americans to buy homes.

True SOTU

As someone who loves the theater of politics, there is nothing better than the pomp and circumstance of the State of the Union address. However, after the backslapping and applause, it will mostly be a selling tool for the standing president. So, we are going to hear a lot of self-congratulations tonight that will sound like a fairy tale of a foreign country because, in your minds, the ‘real State of the Union’ is completely different. In a Fox News poll, 64% of people believe the nation was still in a recession, which is down from 74% a year ago, and 86% in 2010... but not the stuff warranting victory laps.

A Pew Poll is even more dire... as 55% say they are falling behind.

A Wall Street Journal/NBC poll shows only 3% think the nation is strong.

In addition, when Bankrate asked people how they would pay for a $1,000 emergency, only 38% said they could get it from savings.

Tonight is about selling. The fact of the matter is, America has a long way to go.

Today’s Session

The major equity indices indicated higher this morning, ready to reverse the trend of losses experienced since the start of this year. However, closer to the start of the session, the indices trended lower, though still well in the green. Later today, the National Association of Home Builders (NAHB) will release its housing market index. The report is a survey that provides insight on how members of the organization feel about the general economy and housing market conditions.

Below are some of the major companies that reported this morning.

*Open WSS Position