Posted on 08/27/2005 3:14:08 PM PDT by Graybeard58
I kind of get tired of the elderly and the puur,they are kind of like the french, they run their mouths, get themselves into a heap of trouble then bitch that everybody else has to bail them out. Screw"em, if they can't support themselves maybe it is time to give natural selection a chance.
I have some of my savings at ING direct, and am happy with the 3.3%.
I agree: you need to get some basic book on economics.
I am opposed to 'affordable health care' because in the United States, the richest and most advanced nation on earth, every one of our citizens ahs the absolute right to health care. It should not be 'affordable'.
It should be FREE.
Every day I tell my kids that there is no such thing as a free lunch. Then the other day my six year old starts first grade and the first thing they do is try to sign all the kids up for free lunches.
[We've have an unprecedented boom for 25 years, thanks largely to...]
...the steadily increasing productivity of working Americans who are still free to exchange goods and services in an expanding market.
"In the end, Roubini, Walker and others say, disaster is still avoidable, but it's going to require the American people and the country's leaders to clean financial house - to reduce the federal deficit and the trade deficit. Global economics may drive some changes: if Japanese cars cost more, for example, Americans may buy less-expensive GMs."
Good article. There is a rather new book out called Three Billion New Capitalists by Clyde Prestowitz which says a lot of the same things.
Part of the answer is clearly tax reform. We can't afford the luxury of a tax system which puts US producers at a disadvantage in the increasingly global economy any more. The FairTax would help greatly in both the federal budget and the trade deficit areas.
Yeah, whatever. Since it's Republicans engaged in profligate spending it doesn't count! Just like when you eat cake at someone else's house the calories dont' count!
Correct, but that was not the point: the business cycles have been smoothed out to an unprecedented degree, and this was achieved by returning to the historically typical, low levels of inflation not seen in one half of a century.
This would only precipitate a move away from the tax-free to taxable instruments. The only looser would be municipalities and states.
Moreover, the very idea is a socialist misconception. What is equal across investment instruments is a risk-adjusted return on capital. In other words, tax-free and taxable instruments earn the same return. There is no advantage in tax-free instruments for investors: the only beneficiaries are issuers of those bonds.
This talk about "old money"; and "hard-working money" is pure Marxist class envy. And it is also a technical error: once the money is put to use (invested in bonds), it pays the salaries of great many employees --- regardless of whether it was inherited or earned.
This would only precipitate a move away from the tax-free to taxable instruments. The only looser would be municipalities and states.
Moreover, the very idea is a socialist misconception. What is equal across investment instruments is a risk-adjusted return on capital. In other words, tax-free and taxable instruments earn the same return. There is no advantage in tax-free instruments for investors: the only beneficiaries are issuers of those bonds.
This talk about "old money"; and "hard-working money" is pure Marxist class envy. And it is also a technical error: once the money is put to use (invested in bonds), it pays the salaries of great many employees --- regardless of whether it was inherited or earned.
[the business cycles have been smoothed out to an unprecedented degree, and this was achieved by returning to the historically typical, low levels of inflation not seen in one half of a century.]
You are very correct on this.
And the cause of inflation is always allowing the money supply to grow faster than the value of the goods and services it represents.
Unwise government meddling such as printing too much money, imposing price controls, raising the minimum wage, raising marginal tax rates, or increasing the cost of doing business through regulation is nearly always the reason.
There are many tweaks the government can and should do to smooth out the short term bumps in the economy that occur naturally in a free market, but the government always has a hard time resisting the temptation to control all aspects of it by thinking it can legislatively repeal the law of supply and demand. </:^)%
The underlying threat in real estate is all the debt leveraged against its "blue sky" value.
We live in a real estate market of the "greater fool" theory. We believe there will always be a greater fool to pay a lot more for our houses. This allows us to rest our financial anxieties upon a comfortable myth of our personal wealth.
I believe real estate has become a dangerous crutch to justify massive personal debt.
Very true, but isn't this the reason why Fed that deals with the "bumps" is completely independent of those that try to repeal the law of supply and demand?
That independence is symbolized by a true story, which was conveyed to me a few years ago by a colleague, who is an old friend of Greenspan.
While running from one confrence presentation to another and trying to catch an elevator in the conference hotel, he sees Greenspan coming out of that same elevator and says, "Hi Alan, how are you?"
Greenspan's reply: "I am not allowed to say." He was smiling but clearly not joking.
But if I owned 10 rental houses free and clear and owned $1,000,000 in stocks but had no savings account, this study would conclude that I had no savings.
By definition, that's true, but get a historical chart of the CPI and tie it to world events of the time. Such a comparison yields the causes of inflation as war, price controls, government currency manipulation, and government overspending.
As far as business cycles go, business has had very little to do with it for decades. It should be called the government meddling cycle, through either currency policy by the White House, or monetary policy by the Federal Reserve which is usually coordinated with currency policy anyway. If we really wanted to smooth out the bumps in the economy, it could be done by targeting a stable currency value, which is what the Federal Reserve is supposed to do, not micromanage the economy.
You said,
"What is equal across investment instruments is a risk-adjusted return on capital. In other words, tax-free and taxable instruments earn the same return. There is no advantage in tax-free instruments for investors: the only beneficiaries are issuers of those bonds."
That may be "true" for any instant in time. HOWEVER, a tax-rate increase creates an un-taxed capital gain for owners of tax-exempt bonds.
When John Kerry proposed an increase in tax rates for those of us who don't get our income from tax-exempt bonds -- i.e. NOT JfK, I figured that he was pushing for an un-taxed gain (for himself) of more than $500K.
I think it would be useful if ALL Americans (not just working Americans) understood that increasing tax rates is NOT a "good thing".
a tax-rate increase creates an un-taxed capital gain for owners of tax-exempt bonds.
How? If I paid $700 for a bond and get $1000 at maturity, I pay tax on the taxable portion of the difference, and my liability goes up, not down, if taxes increased in the interim. I may have gotten $100 in interest, but that is tax free and I get the same amount even if tax increases.
Moreover, when I tried to reinvest $100 into tax-free bonds I got hurt because their prices increased and I must pay more.
Where are the capital, or any other, gains?
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