SmartMoney: how the the expiration of the Bush tax cuts affects you

Ahahaha, so if you build it, they will come? Why does all of history indicate that you were wrong?




The blue line is effectively unused capacity (the gap between GDP and potential GDP). The red line is business investment as a % of GDP. You will see that as, unused capacity rises, very logically and very naturally, the amount of investment in new capacity falls.

Jesus, did you really need me to tell you that if you have a plant that makes widgets and nobody is buying widgets, you'd be reluctant to open up a new one? Really, I had to explain that to you?

 

Its the efficient, well-managed businesses that do so. All businesses may not have the prowess, but the successful ones do.

Good businesses are now bringing on workers that are talented and willing to take less, expanding market share through acquisitions and they will be the winners when the economic cycle turns.

Its the few dynamic companies and people that create opportunities for all.

I can't believe the people in here believe with any rationality that taxing business owners more and the government will do better. I thought these experiements failied thorughout the world already.

 

I think businesses will expand operations which is more sustainable growth as opposed to short-term sugar highs of unemployed consumption.

 

Yeah so we're back where we started, a combination of platitudes and magic in the face of an actual reality made of facts. Supply does not create its own demand on the macro level.

THe other problem that's apparent is that while others are discussing macro, you're trying to discuss things you may have heard in a junior achievement afterschool program.

Not the same thing.

 

I think the idea of growing and gaining market share during a recession is simply behond you. Being fearful when others are greedy and greedy when others are fearful is how commerce, business and success happen.

My friend I hope one day you step out to start a business and realize the true picture of what you're saying instead of regurgitating the ideas of those that cannot do.

 

It's not beyond me, it's beyond reality:



because you can't get any higher than 100% market share.

 

Then why is M&A activity so high right now?

Because smart managers are taking advantage of weaker firms.

And please refrain from the Krugman ideology 24/7 and come up
with another source once in a while. Krugman is the guy exonerating
Fannie and Freddie from being the biggest losers in the housing bubble.
He is the 'government' for all guy whos policies seem more about normalizing income and wealth across the world than growing our economy.

 

Is there anything that you are possibly able to not be dead wrong about?

A master class of self-pwnage. I beg you to stop.

 

Energy M&A has increased and the well managed companies are acquiring others. Financial M&A has increased over 100% from the last two years as well.

Take a firm like Goldman which has increased market share as many of their competitors failed.

Activity is starting to heat up from the insides which will result in better firms buying out the weaker ones when they feel comfortable in the financial system's ability to provide cash to them if needed.

Concerns over healthcare, increased taxes etc. is limiting some companies spending as well. Savvy managers will start businesses and buyout others and grow when you people are fearful. Examples of great businesses started during a recession:

Microsoft
General Electric
Hewlett Packard
Federal Express
CNN

If they would listen to you about seizing opportunities and starting new businesses during a weaker economy, these great companies wouldn't be around.

They'd be looking at reactionary data as opposed to chasing the American dream which is to save money and one day leave the 'corporate' world and start one's own company and business.

Having lower taxes allows people to do this, and allows businesses to grow from small ones to large global players.

 

So, it is your opinion against demonstrable facts and hard numbers. I know which I believe.

 

FICA tax cut, please.

 

Global mergers and acquisitions volumes in the first half of 2010 fell to their lowest level since 2004,

 

Savvy businesses expand market share during recessions.

 

Can all businesses simultaneously expand market share? Yes or no?

 

This is truly humorous.

I'm not sure what's funnier though, Rocketman's total inability to provide factual data rebutting Sam Fisher's argument, or Sam Fisher's valiant attempts to argue with someone who obviously is not interested in listening.

 

All are not savvy my friend. That is why larger companies become weak and fail and smaller newer businesses grow to take advantage.

This all boils back to the idea we've lost: lower taxes to business owners allows them the re-invest back in their companies or feel more secure in the financial liquidity to keep employees or hire new ones.

When a business owner/s feel more comfortable in their financial position they hire more or don't lay people off! I can't believe this is such a novel concept around here.

Why do you think the job market fell off a cliff after the financial crisis? When companies feared lack of credit (liquidity) from the financial system they began layoffs to build up cash. Taxes work in the same manner to small business owners. If their tax rates are lower they have more liquidity and may not lay off people or may have a marginal impact on hiring and/or expansion policies.

Wow. People here seriously need to work in a business to learn these basic concepts. I think Charlie Munger said it best:

"On how he'd like business schools to be run: I'd start with how the Harvard Business School used to teach, which is starting with the history of businesses. Show why GM rose to power and how it failed. Teach why the railroads rose, then failed, and why they're now good investments. They don't do this because it's hard to teach history over teaching things that are summarized in formulas."

 

The best line and the idea that i'm fighting here in this discussion. Its like what Bruce Lee said : My form is one that breaks down issues to its simplicity. Conventional patterns and ideas shackle something which was once pure and flowing.

Business is shackled by this mainstream academic thought that is taking away the notions of business that made this country great.

 

Whiskey Tango Foxtrot?

 

It (and basically all basso and Odds On posts) is a perfect example of the findings of this study:

http://politicalwire.com/archives/2010/07/11/no_convincing_them.html

"In a series of studies in 2005 and 2006, researchers at the University of Michigan found that when misinformed people, particularly political partisans, were exposed to corrected facts in news stories, they rarely changed their minds. In fact, they often became even more strongly set in their beliefs. Facts, they found, were not curing misinformation. Like an underpowered antibiotic, facts could actually make misinformation even stronger."