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  • February 2nd, 2012, 01:58 PM
    Epidemic
    Quote Originally Posted by MTAtech View Post
    The thing about economics is that there is no moral play. Spending is spending, even if you don't like what was bought.

    The fact is that there was a dot-com bubble, but real people received real paychecks and went out and bought real cars, electronics, etc. There was also a housing bubble, but real people receive real money, paid other real people to remodel their kitchens, bathrooms, etc.
    Actually there is a kinda moral reconing with fake money like the dot com and housing bubble. real money does not have a recall like a bubble caused by faith based growth. At some point someone says "hey why are we paying this much for this crap" it is like a pyramid scheme, good money while it lasts but if you are left carrying the bag you pay dearly.

    When that fake money is pulled out of the economy everything suffers even those guys who got out early to some extent.

    Those real cars are in collections, those real houses are in forclosure lowering the value of my property. Those real kitchen upgrades are now valueless and those real contractors who invested heavily in their business to build houses where there was only speculation are now looking for work with terrible credit rating.


    there may be another short lived bubble but will we see the kinda growth that bailed us out of WWII debt? but that bubble will pop. I wager we will remain more on the popped side than 50 years of growth side.

    Our spending is out of proportion to our likely income. You can't bank on someday another insane speculation bubble will happen again. When and if it does you should not buy based upon it. You should bank it for a rainy day.
  • February 2nd, 2012, 01:33 PM
    brandon184
    Quote Originally Posted by Chuckiechan View Post
    Like Groupon.com? LOL
    No, the Facebook IPO is much more significant. Facebook generated $3.7 billion in profit for 2011.
  • February 2nd, 2012, 01:27 PM
    Chuckiechan
    Like Groupon.com? LOL
  • February 2nd, 2012, 12:53 PM
    brandon184
    Quote Originally Posted by Chuckiechan
    And no that dot com and housing is gone, where is the "new" money going to come from?
    Dot Com Version 2.0!

    Facebook Files for IPO - WSJ.com
  • February 2nd, 2012, 11:54 AM
    Chuckiechan
    And no that dot com and housing is gone, where is the "new" money going to come from?
  • February 2nd, 2012, 11:11 AM
    MTAtech
    Quote Originally Posted by Epidemic View Post
    Both of those periods were False growth don't you think?

    They were based Largely on speculation in the dot com industry and a speculation in a false housing market. both ended poorly.

    Real decades long increase in manufacturing, or technological advancements are not likely. We are no longer have a monopoly on Tech or manufacturing. We have cheap competition and it is growing.
    The thing about economics is that there is no moral play. Spending is spending, even if you don't like what was bought.

    The fact is that there was a dot-com bubble, but real people received real paychecks and went out and bought real cars, electronics, etc. There was also a housing bubble, but real people receive real money, paid other real people to remodel their kitchens, bathrooms, etc.
  • February 2nd, 2012, 09:58 AM
    Epidemic
    Quote Originally Posted by MTAtech View Post
    The economy was growing at several p% each year before the downturn -- and vigorously during the 90s. It's impossible to think that growth will be no more.
    Both of those periods were False growth don't you think?

    They were based Largely on speculation in the dot com industry and a speculation in a false housing market. both ended poorly.

    Real decades long increase in manufacturing, or technological advancements are not likely. We are no longer have a monopoly on Tech or manufacturing. We have cheap competition and it is growing.
  • February 1st, 2012, 08:07 PM
    Chuckiechan
    Allow me to polish my crystal ball....

    I see China heading into trouble, and prices rising as a result.
    I see inflation forcing the value of the dollar lower, making us more competitive.
    I see us eventually coming to terms with our energy needs. A push on nuclear and drilling.
    I think the getting rid of Obama will usher in a new, serious period of bi partisanship due to Romney's character make up and that will lead to bi partisan solutions to our very serious problems.


    We will survive...
  • February 1st, 2012, 07:46 PM
    MTAtech
    Quote Originally Posted by Epidemic View Post
    do you think that we are in a position like after world war 2 with the world rebuilding and us as the only technologically advanced economy of any relevance still intact?

    I don't see the same chain of events taking place that happened during that period. we have competition now
    The economy was growing at several p% each year before the downturn -- and vigorously during the 90s. It's impossible to think that growth will be no more.
  • February 1st, 2012, 06:11 PM
    Epidemic
    Quote Originally Posted by MTAtech View Post
    I thought I was the man?

    The other thing to consider is that current interests are below or at the inflation rate, which makes it a great time to borrow, especially if that borrowing is going to boost GDP, which will then generate more tax revenue.

    What's to keep in mind is that growth is the key. The U.S. never really paid off WWII debts. We just grew so much that the debts became irrelevant.
    do you think that we are in a position like after world war 2 with the world rebuilding and us as the only technologically advanced economy of any relevance still intact?

    I don't see the same chain of events taking place that happened during that period. we have competition now
  • February 1st, 2012, 03:19 PM
    MTAtech
    I thought I was the man?

    The other thing to consider is that current interests are below or at the inflation rate, which makes it a great time to borrow, especially if that borrowing is going to boost GDP, which will then generate more tax revenue.

    What's to keep in mind is that growth is the key. The U.S. never really paid off WWII debts. We just grew so much that the debts became irrelevant.
  • February 1st, 2012, 03:04 PM
    Epidemic
    we are saying the same thing.

    Who cares about 10 years being half a trillion vs 50 billion per year. so we saved half a trillon while incurring 12.5 trillion in debt over the same period. The interest alone over that 10 years will be larger than the total amount collected from the rich.

    If we are going to run government at or around current levels we have to raise taxes between 8 and 14 % just to stay in the black not just stick it to the man with a 5% surcharge.

    1.3 trillion annual deficit and you are offering up as a solution.
    0.05 trillion annual as a solution
  • February 1st, 2012, 02:49 PM
    MTAtech
    Quote Originally Posted by Epidemic View Post
    So how does a 5% increase in their tax produce a meaningful amount of money?

    your claim is the top .1% make .6 to 1 trillion taxible depending on how you run the numbers. Increasing the tax by 5% on that yields a poultry sum of money when compared with deficit spending. Your best calculation puts it at 30.3 to 50 billion to touch the deficit you would need to confiscate it all.
    ...
    I was a bit confused about the difference in the figures, so I asked a Princeton economist of my acquaintance if he knew how I could reconcile this difference. He said it depends upon the years one uses - and he was absolutely correct.

    If one uses 2007 data, before the Great Recession, those earning more than $1 million earned a total of $1,245,321,569,000 (out of $6,063,258,900,000.) However, if one used 2009, those earning $1 million or more earned $626,464,479,000 (out of $5,088,382,848,000.)

    Thus, a 5% increase in taxes on those earning more than a mil., yields an additional $31B or $62B, depending upon the tax-year. Note, that my 5% number is far lower than that of the "Buffett Rule," which raises taxes on this group more.

    Considering that the richest of the rich pay 16.6% on average in taxes, it doesn't sound unreasonable to tax them at 30%, which is still lower than the top ordinary income rate. However, the average tax-rate of the $1M+ group is 25%. That's why I use 30%.

    In any case, just this one tax generates $1/2 trillion over 10 years. I actually favor eliminating the differential rate for capital gains and use the ordinary income rate.

    EDIT: But on the topic of evasion, having a much lower capital gains rate encourages one to make ordinary income 'look like' capital gains. If we got rid of capital gains, addressing the hedge-fund loophole would be unnecessary.
  • February 1st, 2012, 01:45 PM
    Epidemic
    So how does a 5% increase in their tax produce a meaningful amount of money?

    your claim is the top .1% make .6 to 1 trillion taxible depending on how you run the numbers. Increasing the tax by 5% on that yields a poultry sum of money when compared with deficit spending. Your best calculation puts it at 30.3 to 50 billion to touch the deficit you would need to confiscate it all.

    30 billion is not chump change unless it is a payment on the deficit. The only meaningful change you could make to the deficit would be to put a 1% across the board increase in place.

    Using 14.5 trillion GDP alone a little 8% increase on the bottom 99.9% and 14% increase on the top .1% does the job.

    I don't know about you but for the benefits I receive from the government I think they are over spending.

    your own numbers shoot the hell out of your claimed 5% increase on the top .1% by a huge margin.

    14% sounds confiscitory to me
    our GDP is 14.5 trillionish to cover our deficit you need to tax everyone who is paying taxes 9% to break even.
  • February 1st, 2012, 12:22 PM
    MTAtech
    Quote Originally Posted by Epidemic View Post
    is this correct?

    do the top 1% earn an AGI of but 1.3 trillion

    I mean it is good money but the deficit is 1.3 trillion.


    How do your numbers work? suggesting that an even lesser pool 0.1 percent of the income pool can pay for what 1% could not at 100% taxation of AGI?
    First, that's the income of the top 0.1%, not the top 1%.

    Second, and once again, I'm not suggesting that we confiscate all of the income of the top 0.1%* but increasing their taxes can contribute to meaningful deficit reduction.

    According to Barry Ritholtz, the top 400 taxpayers alone...

    The top 400 U.S. individual taxpayers got 1.59% of the nation’s household income in 2007 — 3X the p% they got in the 1990s. • The top 400 paid 2.05% of all individual income taxes in 2007.
    • Only 220 of the top 400 were in the top marginal tax bracket.
    • Average tax rate of the 400 = 16.6% — the lowest since the IRS began tracking the 400 in 1992.
    • Minimum annual income to make the top 400 = $138.8 million.
    • Top 400 reported $137.9 billion in income; they paid $22.9 billion in federal income taxes.
    • 81.3% of income was from capital gains, dividends or interest. Salaries and wages? Just 6.5%.
    * although, when I do the calculation, I get $607,120,800,000 (137,982 tax returns * $4.4 million) (source.) Although, using IRS data before the Great Recession, the top .1% had one trillion in taxable income.
  • February 1st, 2012, 09:08 AM
    Epidemic
    is this correct?
    In 2009, the top 1 percent of all income tax returns with a positive adjusted gross income pulled in a total of $1.3 trillion.
    do the top 1% earn an AGI of but 1.3 trillion

    I mean it is good money but the deficit is 1.3 trillion.


    How do your numbers work? suggesting that an even lesser pool 0.1 percent of the income pool can pay for what 1% could not at 100% taxation of AGI?
  • February 1st, 2012, 08:52 AM
    Epidemic
    MTA how much "income" does the top .1% make annually?
  • February 1st, 2012, 07:54 AM
    mad1
    Quote Originally Posted by MTAtech View Post
    I'd like to see evidence that higher taxes, when those taxes are not confiscatory, crimp economic growth. I never heard of a business person that was offered to be in an investment that earns a profit shy away because they would have to pay taxes.
    Look at the reason companies are leaving Illinois.
    Illinois Downgrade Provides More Evidence that Higher Taxes Make Fiscal Problems Worse, not Better - Forbes
  • January 31st, 2012, 11:26 PM
    MTAtech
    I'd like to see evidence that higher taxes, when those taxes are not confiscatory, crimp economic growth. I never heard of a business person that was offered to be in an investment that earns a profit shy away because they would have to pay taxes.
  • January 31st, 2012, 11:14 PM
    brandon184
    Quote Originally Posted by mad1 View Post
    Did they include the loss of tax revenue from increasing unemployment?
    Sounds like they would have, if they made a specific point of noting it.
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