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Anyone who has ever owned a business understands this business reality. Politicians have never owned a business. They just get elected to pass pork over to their benefactors.
except there are some politicians that have owned a business. irrespective of that...the bottom line is, you'll always hear people whining about whatever tax rate they pay, and they will always cry about paying more. but talk to any person who runs a business and ask them how it impacts whether they make the next sale or if they invest in their business...and you'll hear time and time again - if the demand for the product is there, they'll invest and they'll sell.
so you don't believe that someone will buy the Hostess brand and bring it out of bankruptcy? Inept management isn't a sign that the economy sucks...it's a sign that they need different people running the business.
Someone may, but the stockholders will take a major hit as will the employees. Who knows, they may move the operation to some other location and substitute some junk chemicals for the old recipe. This is an example in the slide in standard of living caused by massive amounts of accumulated debt at all levels of corporations and government. Ultimately someone has to pay for it and usually it is those who had nothing to do with the disaster.
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Look at all the companies sitting on cash and investing in their companies. Look at VZW and ATT building out their LTE networks, and margins are at record highs. Even Apple, which has had some recent missteps, is doing pretty darn good. People are getting more comfortable spending in the U.S., and you still have growth in Latin America and Africa and Asia. Europe hurts the markets right now, but it's not the entire story.
Margins may continue to be good for certain companies for special reasons but overall the economy is in very sad shape as our workforce income declines along with benefits. Family income is at the lowest it has been since the late 1980s, benefits are vanishing as is wealth for the bottom 99%. This is very unhealthy.
Markets no longer reflect the underlying economy, here and elsewhere. It reflects the amount of money that is being transferred from the middle class to the top 1% by Federal Reserve polices. The net result is that the top 1% invest in assets (levitating the markets) while everyone else sees their standard of living decline. This cannot continue much longer. What is being experiences worldwide are the effects of escalating massive debt not growth.
More taxes on everyone and their will be less demand for most products. Have you considered Obamacare into all of this yet? Have you considered the increase on capital gains tax from 15% to 39% that is not insignificant and it incentives NOT investing in business ventures.
That said both Obama and Romney where/are puppets for the international bankers and those who control the money, the difference between them will be negligible.
i won't sell all my stocks if capital gains taxes go up from 15%. where else are you going to put your money?
Someone may, but the stockholders will take a major hit as will the employees. Who knows, they may move the operation to some other location and substitute some junk chemicals for the old recipe. This is an example in the slide in standard of living caused by massive amounts of accumulated debt at all levels of corporations and government. Ultimately someone has to pay for it and usually it is those who had nothing to do with the disaster.
Margins may continue to be good for certain companies for special reasons but overall the economy is in very sad shape as our workforce income declines along with benefits. Family income is at the lowest it has been since the late 1980s, benefits are vanishing as is wealth for the bottom 99%. This is very unhealthy.
Markets no longer reflect the underlying economy, here and elsewhere. It reflects the amount of money that is being transferred from the middle class to the top 1% by Federal Reserve polices. The net result is that the top 1% invest in assets (levitating the markets) while everyone else sees their standard of living decline. This cannot continue much longer. What is being experiences worldwide are the effects of escalating massive debt not growth.
i haven't read the entire thread so i don't know the previous points you've made, but it looks like we agree more or less. I just don't think the economy itself is as bad as people think. I do agree though about the income inequality. It's been eroded over the past 30-40 years. We need to return to the progressive tax policy that we had that created a robust middle class in this country.
i won't sell all my stocks if capital gains taxes go up from 15%. where else are you going to put your money?
The primary issue is not capital gains taxes. It has very minor effect on the overall market pricing. Ditto for dividend treatment, though a change here may cause some reallocation.
The primary factor is Federal deficit spending. Without the $1 trillion a year in Federal Deficit spending the economy would probably collapse causing massive reallocation of capital.
With continued $1 trillion in deficit spending, the market will be happy but the economy will continue its slide as money is transferred from the middle class to the wealthy.
There is always a possibility that the Federal Government and Federal Reserve will actually accelerate the amount of deficit spending. This would be great for the market (since the top 1% will invest a portion of this gift in various asset classes), however it would also accelerate the decline of the overall economy.
So pick your poison. You want a growing market then you are also voting for more deficit spending with the onerous effects on the overall health of the U.S. economy.
BTW, the futures market shot up briefly this morning on a WSJ report that the President is going to present a plan with minor tax increases without limiting the deficit spending. Deeper and deeper in debt we go.
i haven't read the entire thread so i don't know the previous points you've made, but it looks like we agree more or less. I just don't think the economy itself is as bad as people think. I do agree though about the income inequality. It's been eroded over the past 30-40 years. We need to return to the progressive tax policy that we had that created a robust middle class in this country.
Yes, Economics 101 (which Bernanke obviously skipped over) explains that growth in an economy depends upon the velocity of money, i.e. lots of people (the middle class) trading goods and services.
We have replaced Econ 101 with Bernanke 101 which states that an economy grows with increased velocity of the printing press.
Its the fiscal cliff. If Obama and congress can get a deal it will lift the market. I think they will, or at least extend things till the new congress. The new congress will be more sympathetic to Obama than this one. We may have a wild ride on the market for the next few months but when the dust settles I think things will be going up in the market. This time next year we will look back as a time to buy.
Its the fiscal cliff. If Obama and congress can get a deal it will lift the market. I think they will, or at least extend things till the new congress. The new congress will be more sympathetic to Obama than this one. We may have a wild ride on the market for the next few months but when the dust settles I think things will be going up in the market. This time next year we will look back as a time to buy.
If the fiscal cliff is resolved with ever increasing spending while keep revenues neutral then the market will go up. However, the economy will continue to deteriorate at an accelerated clip.
At this point the Federal Government takes in about $1.3 trillion in taxes and $2.4 trillion in overall revenue. However, it is spending more than $3.4 trillion. This excess, since most of it goes to the top 1% helps levitate asset markets. However, by increasing our debt and the cost of servicing the debt (the Federal Reserve is now the largest purchaser of the Government's own debt), it is destroying the economy. So we should all be careful what we hope for. Ultimately, no matter what happens to the fiscal cliff, if the debt continues to climb the market has to collapse because at some point the market has to reflect the reality of the economy.
Really so if income over a million was taxed at 90% for an example, you'd still spend time and effort attempting to make more money when your share of your work is 10%?
The first million is the hardest to make. Once you figure that out, it is easy.
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Originally Posted by bradykp
so you don't believe that someone will buy the Hostess brand and bring it out of bankruptcy? Inept management isn't a sign that the economy sucks...it's a sign that they need different people running the business.
Look at all the companies sitting on cash and investing in their companies. Look at VZW and ATT building out their LTE networks, and margins are at record highs. Even Apple, which has had some recent missteps, is doing pretty darn good. People are getting more comfortable spending in the U.S., and you still have growth in Latin America and Africa and Asia. Europe hurts the markets right now, but it's not the entire story.
Somebody will buy it. It's a valuable brand.
My question; is a Private Equity company involved? They're pretty good at driving countries into the ground... and with their manager turnover would surprise me.
except there are some politicians that have owned a business. irrespective of that...the bottom line is, you'll always hear people whining about whatever tax rate they pay, and they will always cry about paying more. but talk to any person who runs a business and ask them how it impacts whether they make the next sale or if they invest in their business...and you'll hear time and time again - if the demand for the product is there, they'll invest and they'll sell.
Very true! My family and 4 other family members are all business owners. Some are Republicans and some are Democrats, but when it comes to hiring, DEMAND is the only driver. My Republican family members that own businesses argue about fairness. When you count payroll tax, income tax, corporate tax etc, they believe Washington receives enough from them already. It has nothing to do about, them wanting to hire more employees or expanding, but only if taxes remain the same or lowered. It's purely demand driven, the arugment is about fairness.
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