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That's more due to uncertainty that Trump's policies will last more than anything. There is no confidence that current policies will be around. Uncertainty leads people to sitting on cash.
Except for the fact that companies have been sitting on cash for a decade or more. This isn't limited to the past 18 months.
I started a business in 2008 and folded it in 2013. I worked harder for less than any other time in my life. If I'd started a few years earlier, I might have had a chance. The market was terrible when I started and only got worse. I was fortunate to find a decent job.
I also started a business in 2008 and it's still going strong a decade later. Many businesses fail and some succeed for many different reasons, one of which can be a fair dose of luck. I will say that I had (and have) the advantage of a spouse who works full-time, so I was able to roll with the ebb and flow that characterizes most small businesses, at least in the early years.
Except for the fact that companies have been sitting on cash for a decade or more. This isn't limited to the past 18 months.
Right...they have been hoarding cash for a while. They aren't spending it now, even with Trump's policies due to a lack of confidence that those policies will last longer term.
Increasing corporate or capital gains tax rates would just incentivize more hoarding of cash, particularly outside the US. We need a longer period of economic and fiscal policy stability before that cash is going anywhere. Increased corporate or cap. gains rates will just make the current problem last longer.
Right...they have been hoarding cash for a while. They aren't spending it now, even with Trump's policies due to a lack of confidence that those policies will last longer term.
Increasing corporate or capital gains tax rates would just incentivize more hoarding of cash, particularly outside the US. We need a longer period of economic and fiscal policy stability before that cash is going anywhere. Increased corporate or cap. gains rates will just make the current problem last longer.
This is most likely my last post on this topic. We are wandering a bit from the thread OP.
So, how long is it reasonable for companies to hoard cash in case of instability? A simple search shows that several companies have had tens of billions of dollars, in some cases hundreds of billions of dollars, of cash on hand since 2012. My memory is that it has been much longer. Citing instability is not valid when they have had this cash on hand for the better part of a decade, if not longer.
Will they feel stable enough if they have had $250 billion in cash reserves for two decades? Maybe they need $300 billion for three decades before they start to invest?
Now, we can also change tax laws requiring companies to file tax returns based on domestic revenues. I can think of many ways to do this. File a P&L on direct domestic revenues less expenses. R&D can be allocated globally so that companies don't pile those up as an expense solely based in the US market. If the company is incorporated overseas, that is fine. They still need to pay taxes on domestic business. Let Apple keep its Irish business in Ireland.
We can also give a tax deduction for bona fide investment in the US.
Sure, there will be loopholes and lobbying. Accountants and lawyers on both sides. But it can be done, we simply don't have the political will to do it.
I also don't buy the argument that taxing capital gains creates in incentive to hoard cash. Sorry, that makes no sense. If anything it does the opposite. A capital gain is the growth of equity, so any gain on that cash gets taxed. It actually makes more sense to invest the money in development so that they can avoid taxes.
Lastly, do you really think that google is holding onto $200 billion in cash because they are afraid to invest because of uncertainty? They invest in all sorts of stuff, all the time. They are known for it. The problem is that they have too much money, and cannot find things to invest in.
Work is what you make of it, i retired after working 40 years and never had any drama or problems. I didn’t rock the boat i did what was asked of me because i was the employee and was hired to do a job. Where I worked we didn’t stand for any drama, you have a job to do leave your personal life at home.
It shouldn't have to be that way, but so many of us have awful times at our jobs. Many times, you leave one bad place and the next place is worse. Bad managers and bad coworkers are everywhere. I've heard all sorts of stories from family members and have experienced many nasty people at work myself. Why can't the workplace be somewhere you like going rather than hell on Earth?
For me, it usually goes 1 of 2 ways:
1. All my co-workers are awesome, and the job is bad and/or low pay
2. Everyone hates each other, but the job is good and/or good pay
This is most likely my last post on this topic. We are wandering a bit from the thread OP.
So, how long is it reasonable for companies to hoard cash in case of instability? A simple search shows that several companies have had tens of billions of dollars, in some cases hundreds of billions of dollars, of cash on hand since 2012. My memory is that it has been much longer. Citing instability is not valid when they have had this cash on hand for the better part of a decade, if not longer.
Will they feel stable enough if they have had $250 billion in cash reserves for two decades? Maybe they need $300 billion for three decades before they start to invest?
Now, we can also change tax laws requiring companies to file tax returns based on domestic revenues. I can think of many ways to do this. File a P&L on direct domestic revenues less expenses. R&D can be allocated globally so that companies don't pile those up as an expense solely based in the US market. If the company is incorporated overseas, that is fine. They still need to pay taxes on domestic business. Let Apple keep its Irish business in Ireland.
We can also give a tax deduction for bona fide investment in the US.
Sure, there will be loopholes and lobbying. Accountants and lawyers on both sides. But it can be done, we simply don't have the political will to do it.
I also don't buy the argument that taxing capital gains creates in incentive to hoard cash. Sorry, that makes no sense. If anything it does the opposite. A capital gain is the growth of equity, so any gain on that cash gets taxed. It actually makes more sense to invest the money in development so that they can avoid taxes.
Lastly, do you really think that google is holding onto $200 billion in cash because they are afraid to invest because of uncertainty? They invest in all sorts of stuff, all the time. They are known for it. The problem is that they have too much money, and cannot find things to invest in.
How does it not make sense that capital gains tax increases leads to hoarding cash? You do realize that when we talk about 'cash', we are talking about investments, right? That money isn't sitting in a savings account.
Yes, I absolutely think Google would hold onto $200 billion due to uncertainty in market stability, government policy, and fiscal policy.
Again, if capital gains in the US increases, that pushes that investment overseas, or incentivizes less investing to wait until a time when capital gains tax rates are lower. We also can only do so much to change tax laws. We can't control what other countries do to set their laws.
Power is more absolute when you can call your own shots without running the risk of LOSING everything you have ,. Not have some greedy employer call it for you. If you're slave to the expense you throw into a business that MAY or MAY NOT pay off, thats not power. Now if a family member left you a business and showed you the ins and outs, thats another thing. To start something from scratch though?? Thats another thing..
...
You are conflating POWER with ABSENSE of RISK.
Those two phenomena NEVER exist together absolutely.
You have a great deal to learn, Dorian.
Such lessons are rarely pain-free, especially for those whose judgment is badly distorted by anger.
Why can't the workplace be somewhere you like going rather than hell on Earth?
Because there's people in this world that are horrible people who ruin everything for the rest of us. Only thing you can do is deal with it, it's the lucky few who have jobs where they don't have toxic people working alongside them.
I was in a job like that once, you just have to do your best not to let it get to you. My current job, I work with a lot of people that I feel would be in the running for dumbest person on earth, but they're not out to get me or engage in office politics/backstabbing, and I'll take that over a toxic work environment any day.
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