Inflation rate is worst in 17 years

[Capper]

You'll never change government, be it Republican or Democrat, there is far too much bickering between parties, and politicians supporting projects and studies for anything to ever change there.

What we need, is some REAL government regulation when it comes to stuff like banking scandals, retirement funds, credit, etc.......these people pay off politicians, and fleece the rest of us....as Ron said, us middle to lower class folks are going to pay the price.

I know no one will agree with me on this, but I see us really on the edge of a massive depression that will change this country forever......I also see us on the brink of WWIII, but thats another discussion.

[Panda Man]

Originally Posted by Capper

So you cut taxes and cut taxes to give people relief.....where does the country get money from? do we just go further into debt and write it off?

We have so much labor outsourced, so many US companies playing the shell game to avoid taxes and regulation, and credit companies and banks fleecing people at every turn.....its that "We'll be ok...lets just stick our heads back in the sand and put it on credit" philosophy thats put us where we are.....and by the time anyone wakes up, it may be too late for most of us.

Originally Posted by Panda Man

A drop in tax rates gives people more of an incentive to work and also has been proven to actually boost tax revenue as well.

The Reagan Tax Cuts: Lessons for Tax Reform

It's Reaganomics! Granted there is a point that tax cuts prove ineffective, I don't believe we've hit that side of the curve yet. I also believe that tax cuts for businesses may give them more incentive to just pay them rather than look for ways around it, but that's just my hypothesis.

[Capper]

You are focusing on but one small aspect of the overall picture.

[Panda Man]

Originally Posted by Capper

You are focusing on but one small aspect of the overall picture.

How so? People have more of an incentive to work, that boosts their income, it also produces more output, that's good for the business, and gov't benefits as well.

I may be 19 but I know what I'm talking about when it comes to economics ;)

[Capper]

Of course....why would I question your vast experience????!!!!! My bad, everything will be fine, I'll just grab another credit card.

My point being that the tax thing is something people always jump on as a quick fix......put a nice check in someones pocket and they'll forget all their woes for awhile.

My wife is an Assistant VP at a bank, I have friends who are accountants and tax people....and they are all extremely worried about where our economy is headed......you can only push off so much debt, only so many quick fixes.....at some point some hard, and painful decisions must be made...and we are rapidly approaching that point.

[Panda Man]

Originally Posted by Capper

Of course....why would I question your vast experience????!!!!!

Well, I've worked as a CPA/intern at a CPA firm for about 4 years, I've studied macroeconomics for almost 2, micro for half a semester, and half of what I've talked about came from my professors mouth anyways, who's had a doctorate and been teaching economics for about 6 years. So I don't know why either :P

Originally Posted by Capper

My bad, everything will be fine, I'll just grab another credit card

That's about the same thing that started the great depression, buying on margin and credit. Look how well we came out of that one ;)

Oh, and the 80s depression too, that one also only lasted from Oct to Dec :P

Originally Posted by Capper

My wife is an Assistant VP at a bank, I have friends who are accountants and tax people....and they are all extremely worried about where our economy is headed......you can only push off so much debt, only so many quick fixes.....at some point some hard, and painful decisions must be made...and we are rapidly approaching that point.

I'd like to debate with them some time. My dad is a CPA as well, he's had his license for 28 years. Has owned 2 firms, Britain Dean & Barger in Charlotte NC, and William D. Dean CPA PC right here in Elba. He isn't worried at all either.



EDIT65436- Also, I'm not saying we're not headed for difficult times, I'm just with the side of economists that say it won't be as bad as some say. And it won't cause us to collapse, it's take a lot more than people defaulting on C/C's and losing out on sub prime loans

[Hitman]

Originally Posted by Capper

Of course....why would I question your vast experience????!!!!!

LOL, that reminds me of a convoy brief that was given by one of our brand new 2LTs when I was in Germany. "In all my Military Experience I have never seen that happen" Fresh out of OBC, so he hadn't even been in the army for a whole year yet. Not to mention he was talking to a group of NCO's that had all just gotten back from Iraq.

Originally Posted by Panda Man

Well, I've worked as a CPA/intern at a CPA firm for about 4 years,

oooh an Intern that must make you a regular SME.

[PTRMAN]

Hey, c'mon cut the kid some slack. He may not have the experience of some of us (and yeah, kinda silly to say so!) but I think he's on the right track (and not just because he agreed with me).

I've got nearly 20 years (has it really been that long?) of banking / finance and I too am concerned. I think we'll be dealing with this leverage hangover through 2008, possibly into 2009 before things start to really feel better. I don't think it is going to change the landscape, but it will get worse before it gets better. The banks have been (and still are) holding billions of (originally) well-rated leveraged paper, but nobody knows what they're worth anymore. We're likely to see additional write-downs from the likes of Citi and Merrill before we're done. And if the insurers AMBAC or MBIA get into serious trouble (which they may already be in) we could be headed for more. I've seen estimates of some $250BN of potential losses from that and the default swap market on top of the $250BN we're seeing in subprime mortgages. It's likely to be bad, folks, but we will survive. Government and financials institutions are (hopefully) more sophisticated and will better be able to deal with this than they did the Great Depression. For the economy to grow and prosper we have to go through these periodic recessions to weed out the "bad seeds". Firms have to be allowed to fail and homeowners must lose their houses. Otherwise it's just a bailout of inferior firms, something that weakens our whole economy, which is built on risk and reward. Like Icarus, flying too close to the sun will sometimes cause your feathers to melt.

[Tech Geek Deluxe]

Growth ... people ... Growth ... We have been in debt quicksand as a Nation for decades.
Growth and repair during growth is the only hope ... lest we say FU ... to the international bankers and default and say "Zero Balance" and tough luck internationalists ... we are doing our "OWN" economics now.

Yeah ... then WW3 would be here ...

So ... Growth is the only hope of pulling out from the sucking sound ...

there are multitudes of things that stimulate growth ... but we need a bunch at once ... and now.

BTW ... I am in favor of saying FU to the internationalists and stopping the lying agendas to stimulate growth ... its so unlikely that it just isn't gona happen.

[fstroupe]

Considering that we have had nearly zero inflation for the past 17 years, it isn't surprising that it eventually went up. Alan Greenspan kept it low by artificial means for 20 years. If you want to blame George W. Bush for it, go ahead. He's been blamed for pretty much everything that anyone doesn't like in the world.

There is too much in this thread to touch on, but let me mention the "stimulus package". Bush wants tax cuts...Pelosi and Reid wants to cut everyone an 800 buck check. The latter is not intended to be a long term solution, but a "shot in the arm". The former is mainly intended to be a long term solution. We will likely get both.

Regardless of what talking head you happen to listen to, every time in the history of the US that taxes have been lowered, treasury revenues increased, due to taxation of the monies made from the increased investments that always occur.

Since most of you guys don't like republicans, I'll look at JFK's tax cuts. (actually, they were proposed by JFK in Dec 62, but signed into law by LBJ in Feb 64) The stock market had fallen sharply in the summer of 62, unemployment started to rise slightly, and Kennedy's economics guys were afraid that we were entering a recession. Actually, the administration did not really desire to lower taxes, but to try to ease the economy with some social programs, but Kennedy realized it was the right thing to do after being shown the possibilities by his economic experts.

The funny thing is that his experts expected it to produce short-term growth, and didn't realize that it would cause long-term growth. They were mainly afraid that the Kennedy administration would be blamed for a recession.

In 1961, the top marginal rate of individual income tax was 91%, and the top corporate rate was 52%. Kennedy lowered the individual rate to 70%, and the corporate to 48%. This produced economic growth through 1969, enough so that GDP growth rose to 4.2%, as opposed to the 2.1% during the 1950s. During that period, tax revenues went up 67%.

The Regan and Bush tax cuts produced similar results.

The big problem with all three tax cuts was that there was no decreased government spending, which would have produced tax surpluses for investment...which would have further increased treasury revenues. There were no real provisions for it in the JFK cuts, and between Vietnam and "The Great Society" spending greatly increased. Regan's tax cuts did have provisions for cutting spending, but Congress didn't honor them. Bush would have never gotten his cuts passed if there were significant spending cuts in the bill.

I know no one will agree with me on this, but I see us really on the edge of a massive depression that will change this country forever......I also see us on the brink of WWIII, but thats another discussion.

Out of every statement made in this thread, this one is the most true...If Hillary/Barack/Edwards/unknown Dem win, after they restore capital gains taxes, raise the rates on the top two tax brackets (affecting about 90% of all small business owners), and raise the top corporate rate, unemployment will hit double digits for the first time since Regan's tax cuts, investment will drop sharply, the economy will falter, and we will finally see the recession/depression that we have been told that we are about to see for the last 5 years or so.

Actually, we are in WWIII...we just don't realize it yet.