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No rocket science here: Nothing drops to the bottom line of consumer confidence numbers like...
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Tuesday, January 29, 10:16 AM ETNo rocket science here: Nothing drops to the bottom line of consumer confidence numbers like smaller paychecks, and that's what Americans are seeing in 2013 thanks to higher payroll and income taxes. Today's 58.6 read missed expectations by a mile and the outlook for employment fell as well, with those anticipating more jobs declining to 14.3% from 17.9%. The XLY slides 0.8%, the XRT -0.7%.
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That's actually quite funny. You assume the average American actually has a clue when it comes to an obscure detail like this - this isn't Snooki's latest boyfriend we are discussing here.
The Average Joe/Jane just woke up to the fact that we had a tax increase despite the fact that they were told endlessly that the "middle-class" tax cuts have been protected and taxes won't rise on them.
Apparently the "middleclass" now refers to that group of people that don't work for a living :)
I agree they haven't a clue; aided and abeted by the MSM.
At my company a LOT of people look forward to their COL increase annually. They are the people Galt talks about (above). They will be bummed. I know this for a fact.
Comparing governments to corporations like they can be run in the same way is something that politicians, specially republicans, love to make. They are very different entities and being successful at running one doesn’t make anyone successful at running the other. Starting with the fact that governments are not there to make profit but to actually take a cut on any value generated in its jurisdiction.
No. The problem is the spending, not the debt. All taxes have to do is get a little higher and we will be better to stop working and get on the government tit. Once that happens tax revenue will start a downward spiral and then everybody is toast.
So live high on the hog, till the hog dies, then deal with it? That is a real mature attitude!
At the same time, as a sovereign issuer of it's currency and with a few changes to some existing laws, the US Treasury could easily print money to pay off all debt to debt holders foreign and domestic. The world might not like it, but what are they gonna do? For example, what would China do if the US redeemed their Treasury holdings by depositing $2 Trillion into China's bank account digitally.
Respondent: "Well, I'm unhappy that they've raised our payroll taxes, and I'm even more unhappy that Obama was re-elected (if a Republican). I feel very negatively about all of it."
Pollster: "May I also ask you..." (interrupted)
Respondent: "Sorry, Sonny, I don't have time for further questions. I have a lot of shopping to do today."
(1) taxes are a TRANSFER of wealth payment from YOU to the government. we need to swiftly take back control of how, when, why and at what levels those transfers occur, or we're cooked;
(2) and this i cant believe: the notion of the federal government redeeming foreign holdings of treasury securities with currency? are you kidding me? exactly how inflationary do you think THAT will be and how destructive to economy do you think it will be? and then, just keep printing money? go long wheelbarrows and memorize the words "Weimar Republic" and "Argentina".
When you look at the old tax rates do yourself a favor and factor in inflation. A solid middle class family made a salary that didn't put them in a high rate and lived a pretty darn good lifestyle.
Also, state and local taxes were not what they are today.
Don't look at one factor in isolation.
first, your condescending comments fully display your lack of understanding of economics, money & banking.
increasing the stock of anything--including currency--would be enormously in the absence of a like amount of demand. i doubt china would take to kindly to having the treasury holdings--even earning the meager interest that they do--exchanged for non-earning cash. Their first reaction would be to stop funding our deficits (remember those?) thereby driving up our cost of borrowing (it's called competing for capital markets allocation), increasing our deficit further and yes, increasing inflation.
next, china would likely take their unwanted stash of dollars and start buying both commodities and hard assets around the globe, but especially here in the u.s., given the likely impact your idiotic proposal would have on exchange rates. the effect would be the same: scarcer supply of hard assets and commodities and growing inflation which would only reach an equilibrium level when all those dollars you printed are absorbed. a long time from now.
go back to class.
And then sir ( no condescension intended) what happens to their market for their products? Ooops - it vanishes. So who will they sell all their stuff to?
the flip side of destroying the value of our currency through highly inflationary tactics is that we at the same time create a huge trade imbalance, given the rising cost of imports. now, if you want an economy that manifestly favors exports over imports, that's fine. but, be ready for currency wars and trade restriction across the global economy. AND, given the the U.S. is a decidedly greater consumer economy than it is a producing economy, we'll just push up prices here even more.
show me one economy that long thrived by destroying the value of its own money. Sir.